Speaker 1: From the heart of We're Innovation, Money and Power Collie
Speaker 1: in Silicon Valley, NBR. This is Bloomberg Technology with Caroline
Speaker 1: Hide and Ed Ludlow. I'm Caroline Hide and Bloomberg's world
Speaker 1: headquarters in New York, and I'med Lovelow in San Francisco.
Speaker 1: This is Bloomberg Technology, back together and coming up. Full
Speaker 1: market coverage ahead. We're going to kick off the second
Speaker 1: quarter then USA one hundred. Is it a bill market?
Speaker 1: But will it stay Morgan Stanley, well, it thinks maybe
Speaker 1: you should be warning about this tech valley last Tesla.
Speaker 1: One name weighing on the market is Deliveries full short
Speaker 1: of Elon Musk's own expectations. Will bring you the details.
Speaker 1: And speaking of Mask, we'll get their latest on its
Speaker 1: spat with The New York Times as the newspaper loses
Speaker 1: it's verified badge on Twitter. That so much more coming up,
Speaker 1: But first, I mean we got to delve into the
Speaker 1: market moves. When it comes to the NASTAC one hundred.
Speaker 1: Of course, we're just saying soaring into a bullmark in
Speaker 1: the first quarter. But Morgan Stanley's Mike Wilson, he's been
Speaker 1: warning that the rally maybe is overdone. Let's bring in
Speaker 1: Isabel Lee just to talk about the technicals at play.
Speaker 1: Some of the reasoning behind Isabel the movement into big tech.
Speaker 1: It was almost like a search of safety right now,
Speaker 1: people particularly Morgan Stanley and also JP Morgan saying that
Speaker 1: might be time to pull back from that trade exactly.
Speaker 1: So Morgan Stanley said it's overdone. So last week the
Speaker 1: tech sector hit the bull market, which means it was
Speaker 1: up twenty percent from US in December lows. But for
Speaker 1: Mike Wilson that was just a bit too much, and
Speaker 1: he said it's just because people were treating it as
Speaker 1: a traditional defensive place amidst all the banking turmoil. But
Speaker 1: he still recommends safer areas like utilities like a zoomer
Speaker 1: sector because he also said that when something hits its trufugh,
Speaker 1: the likelihood is it'll just rally back up. So he
Speaker 1: said he would prefer to see more durable lows before
Speaker 1: investors piling aggressively, but for now it's kind of an
Speaker 1: over for him. Hey is about There's one thing, Karen,
Speaker 1: I've learned in recent weeks around the tech sector. It's
Speaker 1: one session a market does not make. But we're kind
Speaker 1: of looking at economic data again. Right, we're still going
Speaker 1: back to the same discussion around inflation and the FED.
Speaker 1: That's exactly right, which is why people are probably thinking that, Okay,
Speaker 1: you know, that's that's a risk. Assets are rallying because
Speaker 1: they're like, inflation is over. We'd probably not over, but
Speaker 1: we've hit the peak FED. We'll start cutting sometimes this year.
Speaker 1: People have various estimates, but it's kind of bullish overall,
Speaker 1: which is a risk. Assets are rallying now. Bitcoin is up,
Speaker 1: It's enjoyed its best quarter seventy two percent or seventy
Speaker 1: four percent in the past two years. All risk assets
Speaker 1: are really up and they're just really enjoying the bounce.
Speaker 1: And here's some good news for the bitcoin lovers. April
Speaker 1: is usually a good month for bitcoin, actually even for stocks,
Speaker 1: and by some measures, bitcoin was up in six out
Speaker 1: of the last ten years. Isabelle dig in here because
Speaker 1: you've been writing great stories together with Aldanna about well,
Speaker 1: the lack of liquidity and bitcoin, even though we see
Speaker 1: it's run up in price, Yes, and because there's lack
Speaker 1: of liquidity, then the prices are more pronto volatility because
Speaker 1: one big whale or one big move can just pull
Speaker 1: the price lower or higher, and that's kind of been
Speaker 1: the danger in this sector. But for now, especially with
Speaker 1: the banking termoil, people are celebrating it because this is
Speaker 1: why bitcoin was made. It's to circumvent all the intermediaries
Speaker 1: to just put their trust into the thing that they
Speaker 1: trust and not trust Wall Street. Bitcoin was born right
Speaker 1: after the GFC, when people were mad at banks, when
Speaker 1: people didn't trust anyone. So now it's kind of their
Speaker 1: victory lab but it still remains to be seen whether
Speaker 1: the banking turmoil actually push bitcoin higher. It's that's why
Speaker 1: I love carving the space. You'll never just know why.
Speaker 1: In particular, I'm gonna be delving into who else is
Speaker 1: winning amid the bank tim all and wow, we've got
Speaker 1: a VC name on talking that it's fintech in fact
Speaker 1: as well as welly, great to have you on all
Speaker 1: things risk assets. Let's stick with the markets though, because
Speaker 1: actually one risk asset monkey player in the technology space, Tesla,
Speaker 1: well it actually didn't perform particularly well in March. Today
Speaker 1: it's weighing on the broader indices once again, Led you
Speaker 1: are the first and foremost person I think of when
Speaker 1: I think of Tesla. Just dig in a little bit
Speaker 1: about why we're seeing Musk full shorten his delivery issues
Speaker 1: even though we see the price cuts coming. Yeah. Yeah,
Speaker 1: record deliveries in the first quarter of twenty twenty three,
Speaker 1: four hundred and twenty three thousand evs in the first
Speaker 1: three months of the year. It's a modest growth, right.
Speaker 1: You look at the end of twenty twenty two, four
Speaker 1: hundred and five thousand, it's about four percent sequentially quarter
Speaker 1: on quarter, above street expectations. But the bigger picture is
Speaker 1: that it does not put Tester on track for that
Speaker 1: fifty percent annual average growth rate that Elon Musk has
Speaker 1: talked about. It's not enough to show that demand is
Speaker 1: still there. There are still demand concerns for the street, right,
Speaker 1: And one point here is that Elon must talked in
Speaker 1: the first two weeks of January about demands running at
Speaker 1: twice the rate of production. You dig into the data
Speaker 1: kind of seems like demand might have tapered off towards
Speaker 1: the end of the quarter, even though the prices have
Speaker 1: been pulled back, even though we've got well then firing
Speaker 1: on all cylinders, which actually making the autos. What does
Speaker 1: a backlog of potential of cars sitting around me. Yeah,
Speaker 1: it's a profitability that's certainly the right days point. Look
Speaker 1: at the three orange bars four inche bars here, four
Speaker 1: straight quarter where production is greater than the number of
Speaker 1: vehicles that Tessa's delivered. One explanation from Tesla is they're
Speaker 1: still trying to get the mix of where these vehicles
Speaker 1: are produced more even which results in particularly the model
Speaker 1: Essent Model X being in transit at the end of
Speaker 1: the quarter. You can't consider those delivered vehicles because they're
Speaker 1: on the back of a truck. Essentially, it was the
Speaker 1: lowest delivery level for S and X in that quarter
Speaker 1: just gone going back to the third quarter of twenty
Speaker 1: twenty one, So something's not quite working there. What analysts
Speaker 1: are saying is we're worried that actually there is still
Speaker 1: demand issue here. Remember Elon Musk has pledged that if
Speaker 1: there is a deep recession this year, Tessa's happy to
Speaker 1: sacrifice profit margin because they've got that strong balance sheet
Speaker 1: and they want to keep up that steady rate of growth.
Speaker 1: It's just that we're not seeing that steady rate of growth,
Speaker 1: and many still worry maybe in some part that he's distracted, right,
Speaker 1: he's distracted with the other key company that's under his
Speaker 1: overview is Twitter, and we know that at the moment
Speaker 1: he's in particular spot with New York Times resulted in
Speaker 1: the paper losing its verified badge over its refusal to
Speaker 1: pay for that one important checkmark, joining us now Bloomberg's
Speaker 1: Asia accounts. Just how important is that checkmark for something
Speaker 1: like New York Times the yellow badge. It's critical for
Speaker 1: an organization like The New York Times to have that
Speaker 1: badge because it verifies that they are, in fact a
Speaker 1: news institution. You can imagine the challenges that could arise
Speaker 1: if another account were to impersonate the New York Times
Speaker 1: and start spreading false news or misinformation. So it's really
Speaker 1: critical that they have that checkmark. I think we point
Speaker 1: out Caroline right that Bloomberg News has said that it
Speaker 1: won't reimburse staff to get their own Twitter Blue method
Speaker 1: of verification. Bloomberg News and its various newsroom accounts does
Speaker 1: have verification. What's really difficult understand is if you go
Speaker 1: on someone's profile and hover over the blue check mark,
Speaker 1: it's either a Twitter Blue account or it's a legacy
Speaker 1: verified account that may or may not be notable. They
Speaker 1: haven't taken the action that they said they would no,
Speaker 1: and that's actually a change. Right if you were to
Speaker 1: look a week ago, when you would hover over the badge,
Speaker 1: you could see very clearly this person paid for Twitter
Speaker 1: Blue or this person was a legacy verified institution or individual.
Speaker 1: So it's actually created more confusion and we really don't know.
Speaker 1: And they haven't taken away some of those like checkmarks
Speaker 1: that they said they were Unapril first. They've taken away some,
Speaker 1: but some are still out there, Kara. One thing we
Speaker 1: discussed with Elisha on Friday was the idea that also
Speaker 1: advertisers are kind of not very convinced by Musk. They've
Speaker 1: kind of fled the platform. Where does this platform stand
Speaker 1: in terms of its health because you have Elon Musk
Speaker 1: on the other hand saying we're at record levels of
Speaker 1: use right in terms of using numbers, Yeah, that's what's
Speaker 1: been really interesting. They do have more daily users since
Speaker 1: according to Musk's numbers, since the last time he released them,
Speaker 1: but you're losing advertisers and that was about eighty nine
Speaker 1: percent of revenue, and so Twitter Blue is seen as
Speaker 1: a way to make back some of that revenue. But
Speaker 1: their subscriber numbers are also really low. It's less than
Speaker 1: one percent I think according to the last numbers. So
Speaker 1: it's Twitter is in a really challenging position right now
Speaker 1: and they have to either convince people to subscribe or
Speaker 1: they're going to have to woo back those advertisers, and
Speaker 1: neither one of those has really been going well. Do
Speaker 1: we know any updated numbers on subscribers. I mean, this
Speaker 1: is the joy of it being a privately held business,
Speaker 1: But do we know if eventually people will be pushed
Speaker 1: to make that payment. You know, analysts I've talked to
Speaker 1: you and people in industry don't think that it will
Speaker 1: really push the needle. We don't really know the latest numbers. Again,
Speaker 1: it is a private company, so it's hard to tell.
Speaker 1: There's some independent researchers that are tracking it, but from
Speaker 1: what we know, it's less than three hundred thousand people.
Speaker 1: We want to thank you staying on top of all
Speaker 1: things social and I accounts. Great to have you one
Speaker 1: once again. Meanwhile, let's talk about another form of social communication.
Speaker 1: Former President Donald Trump said on truth Social a post
Speaker 1: that he plans to leave mar Alago at noon today
Speaker 1: to fly to New York ahead of his historic arraignment Inhattan. Courtroom.
Speaker 1: That's tomorrow. Make Simone, Foxman is outside of the court house,
Speaker 1: and Simone, do we know if in that fact he
Speaker 1: is on route. As of yet, we haven't seen any
Speaker 1: reports from the pool that he has actually moved out
Speaker 1: of Marrow Lago, but we do expect him to fly
Speaker 1: to New York later today and then come here to
Speaker 1: Trump Tower behind me, and this is really where some
Speaker 1: of the political theatrics could kick off. You may be
Speaker 1: able to see there are some banners behind me. We've
Speaker 1: seen in the last couple of minutes some Trump supporters
Speaker 1: walking with banners and kind of lining up over there,
Speaker 1: but there are barricades all around us. Then, of course,
Speaker 1: the big event is when he goes south to the
Speaker 1: DA's office to the courthouse to be arraigned, expected tomorrow afternoon. Simone,
Speaker 1: as you say, now, moved across to Trump Tower and
Speaker 1: looks busy. It looks like people embracing themselves. And this
Speaker 1: is something that you've continued to report on throughout the show.
Speaker 1: It does become a technology story in many ways, just
Speaker 1: the in which news is consume nowadays, well very much
Speaker 1: because you look at the stock reaction in those sort
Speaker 1: of conservative social media platforms. They will rose Friday. I
Speaker 1: think some of the games being given up. Now, what
Speaker 1: we were discussing is that Trump is using true socials
Speaker 1: communicate in real time. The rest of the world is
Speaker 1: discussing this Simon on Twitter. Go back to the basis
Speaker 1: for what's to come. His lawyer was pretty clear he
Speaker 1: will hand himself in essentially, and what process happens after that. Yeah,
Speaker 1: so essentially we're expecting him to go to the Supreme
Speaker 1: Court House downtown. There. We don't know actually whether or
Speaker 1: not he will walk in the front door, whether he's
Speaker 1: going to try and stage some sort of perp walk
Speaker 1: that he could use again for those fundraising efforts to
Speaker 1: try and paint himself as a victim. But he will
Speaker 1: go in there, we'll get fingerprinted, He'll likely have to
Speaker 1: take some sort of mugshot photo, and then he'll go
Speaker 1: upstairs where this arrangement will take place. After that, he
Speaker 1: intends to leave New York City pretty quickly though, fly
Speaker 1: back tomorrow lago, and then there will be a press
Speaker 1: conference tomorrow evening, and of course at that time we'll
Speaker 1: actually know what these charges are. They remain under seal,
Speaker 1: and surely thereafter we will get Donald Trump's response, we
Speaker 1: will cover every development here on Bloomberg Television, Bloomberg's own Foxman,
Speaker 1: thank you. Out in the field reporting M and A
Speaker 1: Monday shares a WWE sliding after Endeavor agreed to buy
Speaker 1: the company from nine point three billion dollars if that's
Speaker 1: including debt. WWE will combine with Endeava's Ultimate Fighting Championship
Speaker 1: to form a new company that's going to be listed
Speaker 1: on the New York Stock Exchange, joining US. Now for
Speaker 1: more Spoomberg's Lucas Shaw, who, unfortunately for him, had a
Speaker 1: busy weekend. I'm sure Lucas for the scoopman Ari Emmanuel
Speaker 1: of Endeavor saying they will create a global life sports
Speaker 1: and entertainment peel Play built where the industry is headed.
Speaker 1: Where's it's headed? Well, look, they have the biggest mixed
Speaker 1: martial arts league in the world in the Ultimate Fighting Championship,
Speaker 1: and they now have WWE, which, while not technically a sport,
Speaker 1: you know, it's scripted entertainment. It performs much in the
Speaker 1: same way from a media perspective because people do show
Speaker 1: up to watch it live, and then the ways it
Speaker 1: makes money are very similar to UFC. You know, you
Speaker 1: think about it. In UFC makes money from media deals,
Speaker 1: it makes money from ticket sales, and it makes money
Speaker 1: from sponsorships. WWE is the exact same way, and I
Speaker 1: think they see an opportunity to sort of leverage that
Speaker 1: combine scale in negotiations with sponsorships, certainly, and then to
Speaker 1: find efficiencies and things like staging the events. I think
Speaker 1: when you think about the media landscape, Lucas, you know,
Speaker 1: many of the broadcast networks fight over being able to
Speaker 1: show WWE. Do we have any sense of how things
Speaker 1: now change, how they expand the offering, how they make
Speaker 1: it more digital. You know, it's too soon to know that,
Speaker 1: But if you look back in time, there was a
Speaker 1: point where the WWE created its own streaming service and
Speaker 1: then after a couple of years, decided that that wasn't
Speaker 1: the best idea and was better to just distribute it
Speaker 1: via the major players. So it has deals on linear
Speaker 1: TV with the USA Network and Fox, and then it
Speaker 1: has a streaming deal with Peacock. The TV deals are
Speaker 1: coming up, the negotiations or we're actually supposed to start
Speaker 1: kind of this past weekend with WrestleMania. I imagine that
Speaker 1: now the endeavor folks will have a lot of thoughts
Speaker 1: on what that should do. But if you look in
Speaker 1: kind of Ri Emmanuel's track record and Mark Shapiro, who's
Speaker 1: the president of Endeavor, you know, one of the ways
Speaker 1: they built USC into a huge business because there were
Speaker 1: doubts people thought that maybe they had overpaid for UFC.
Speaker 1: Was they struct these huge deals with ESPN, And I
Speaker 1: think they'll be able to do something similar with WWE,
Speaker 1: depending on who the partner is. When I talk about
Speaker 1: the owner of ESPN, because it's an all important annual
Speaker 1: general meeting about to be upon us Lucas. Yeah. You know, look,
Speaker 1: Disney is going through a very strange moment right now,
Speaker 1: or perhaps an unsettling moment for investors and for employees.
Speaker 1: You know, they're in the midst of laying off about
Speaker 1: seven thousand employees. They did sort of one round of
Speaker 1: that in the past couple of weeks, with much bigger
Speaker 1: rounds to come. And then you know, current CEO Bob
Speaker 1: Iger is both trying to restructure the company and restore
Speaker 1: faith in it after some of the damage done by
Speaker 1: his predecessor, Bob Chapeck, while simultaneously thinking about who his
Speaker 1: successor should be. All Right, Bloomberg's Lucas Shure, who leads
Speaker 1: our streaming screen time coverage. Thank you. Now, coming up
Speaker 1: from byte Dance to Micron, Apple and beyond, we'll bring
Speaker 1: you the headlines that you need to know in talking tech.
Speaker 1: Speaking of take a look at shares of Micron. What
Speaker 1: we've seen Caro in the last four sessions or so
Speaker 1: is retaliation from China in terms of pushing back on
Speaker 1: technology restrictions, a sort of tip attack. What the United
Speaker 1: States is doing. Micron lower by one and a half percent.
Speaker 1: This is Bloomberg time for talking tech, Starting with Apple
Speaker 1: basing a billion dollar trial over its Apple Watch secrets
Speaker 1: medical devices make a Massimo is taking the case before
Speaker 1: a federal jury in California this week after claiming Apple
Speaker 1: used confidential information from two former executives it hired in
Speaker 1: certain functions and designs of its flagship Apple Watch. We
Speaker 1: will track that trial. Revenue of TikTok's parent company, Bite
Speaker 1: Dance surge more than thirty percent to surpass eighty billion
Speaker 1: US dollars in twenty twenty two. That matches the tally
Speaker 1: at arch rival ten Cent and surpasses many internet firms.
Speaker 1: That pace of expansion underscores the resilience of Bite Dance
Speaker 1: this business, even at a time when Washington's threatened to
Speaker 1: join India in banning TikTok and Beijing launching a probe
Speaker 1: into Micron, opening a new front in Beijing's chip war
Speaker 1: with the US and Chinese chip related stocks really advancing
Speaker 1: amid optimism that they will benefit from the nation's growing
Speaker 1: self reliance and it's push after Beijing launched that probe
Speaker 1: into Micron technology, Caroline well from China to the Bay
Speaker 1: Area because we want to dig in a little bit
Speaker 1: more and where you are currently well residing in because
Speaker 1: it's been hit hard. We know San Francisco by the pandemic.
Speaker 1: It's had a half time coming back as tech workers
Speaker 1: just kept working from home. They left many of the
Speaker 1: downtown perhaps emptier than many would have liked. And now
Speaker 1: that old school bang run that turned the tech hub
Speaker 1: into the center of the financial termil has just of
Speaker 1: course still hit a city when it's down. Bloomberg San
Speaker 1: Francisco Bureau chief Karen Breslau is with us for more
Speaker 1: on what does this mean for San Francisco's future. You've
Speaker 1: got a beautifully written, really thought provoking peace on the
Speaker 1: terminal today. Thank you, Caroline. I think the storms that
Speaker 1: have pounded the city NonStop since January really are a
Speaker 1: metaphor for the storm of bad news that just has
Speaker 1: hit this city over and over. I mean talked about
Speaker 1: the you know, the bus hitting the city. Obviously, the
Speaker 1: tech downturn was one thing, but then we had SVB
Speaker 1: and the shakiness and the banking sector. We have the
Speaker 1: affordability crisis, a public safety crisis and it is and
Speaker 1: the fact that this is a city where, you know,
Speaker 1: return to office rates are the lowest in the United States.
Speaker 1: So it's just all hit the city at once. It's
Speaker 1: a triple whammy. We're looking at live pictures facing down
Speaker 1: the embarked arrow towards downtown. Two key data points, occupancy
Speaker 1: and unemployment. What have you learned in our report take, Well,
Speaker 1: there's a paradox there. Occupancy is a is a really
Speaker 1: shocking twenty nine point seven percent, the highest anywhere, right,
Speaker 1: twenty nine point seven percent of those buildings, nearly a
Speaker 1: third are empty, and yet the unemployment rate in the
Speaker 1: city is two point eight percent. So that is the
Speaker 1: paradox of San Francisco. That you have so much innovation
Speaker 1: self employment startups, and those typically are not company in
Speaker 1: those early stages that need these giant officers. I've called
Speaker 1: this city home for five years now, Caroline has lived
Speaker 1: in this city. We ask ourselves the same questions, one
Speaker 1: crisis at a different time. You spoke to the mayor,
Speaker 1: what's her proposal to fix all of this in the
Speaker 1: long term health? Well, her proposal, I mean she heard
Speaker 1: her job is to be the cheerleader, and I thought
Speaker 1: she she she gave a you know, a noble effort.
Speaker 1: What she has talked about relentlessly is diversification. She has
Speaker 1: always argued that this overreliance on the tech sector is
Speaker 1: dangerous for San Francisco's economy. Of course she's right, She's
Speaker 1: not the first person to have that observation, But she
Speaker 1: wants to attract bioscience, life science. Tourism converts some of
Speaker 1: these empty towers into housing, which would you know, basically
Speaker 1: deal with two crises at once, yet is incredibly expensive
Speaker 1: and doesn't always pencil out, so um, you know in
Speaker 1: lord tourists. So all of that is going to take
Speaker 1: a clean up and a perception that this is a
Speaker 1: safe and beautiful city, and it certainly is beautiful can't
Speaker 1: argue with that. It is it's going to take a
Speaker 1: big marketing campaign to remind everyone of that. And the
Speaker 1: tourists are back, ye coming, and it feels like and
Speaker 1: that's what's sort of Also the juxtaposition here is that
Speaker 1: when you're in some of the areas that tourists are busy,
Speaker 1: it feels thriving, the restaurants are busy and humming. But
Speaker 1: then you go to downtown and does feel emptier? Will
Speaker 1: somehow the neighborhoods are hopping, well, will they feel even
Speaker 1: emptier if you're getting meta againting some of the key
Speaker 1: tech companies doing layoffs as well. I think it is
Speaker 1: so empty right now, it's hard to imagine, you know,
Speaker 1: another few thousand missing from downtown. And those employees are
Speaker 1: also distributed, some of them in San Francisco, some of
Speaker 1: them are at the company's headquarters south of here in
Speaker 1: San Mateo County. But I think what has to happen is,
Speaker 1: you know, pretty soon as the prices plummet right for
Speaker 1: this commercial will estate, there will be a value proposition
Speaker 1: and somebody, you know, some companies will move in the
Speaker 1: neighborhoods are hopping. We talk about that in the story,
Speaker 1: particularly around Hayes Valley, which is now AI Valley or
Speaker 1: Cerebral Valley pick the brain part. Yeah, but there is action,
Speaker 1: as Karen Bresler, who leads our coverage to California, thank
Speaker 1: you know, coming up all things AI experts calling for
Speaker 1: a whole to next gen development. Europe growing more cautious.
Speaker 1: We're gonna have all the details. Were quite a big
Speaker 1: name in the sector, Caroline, this is Bloomberg. I really
Speaker 1: care about access and also a reinforcement of bias. But
Speaker 1: the thing to do is to address these concerns in
Speaker 1: like a open and transparent way, not to call for
Speaker 1: a hall to development. Welcome back to Boomberg Technology. I'm Caroline,
Speaker 1: had a Niel and I made Ludlow in San Francisco.
Speaker 1: That was Fiction founder Sarah Gaw. They're saying it's important
Speaker 1: to keep experimentation open and going in generative AI. Her
Speaker 1: comment comes after more than a thousand AI experts industry
Speaker 1: participants signed a petition calling for a temporary halt to
Speaker 1: developing the next generation of AI tools. One of them
Speaker 1: Kevin Barragoner, founder of the artificial intelligence text to image
Speaker 1: generator deep AI, who joins me on set in San Francisco.
Speaker 1: Why did you sign the petition? So the petition calls
Speaker 1: for a halt to the development of extremely large generative
Speaker 1: models like the GPD five that's in development, and this
Speaker 1: is an incredibly disruptive technology. We don't even really know
Speaker 1: what it will be capable of, but what we do
Speaker 1: know is most likely advanced reasoning capabilities similar to the
Speaker 1: human brain. So in a sense, this is just too disruptive.
Speaker 1: I think for the current moment, there's no reason we
Speaker 1: should really be building it right now. What's being proposed
Speaker 1: is a six month halt in order to established a
Speaker 1: shared set of safety protocols. There are names from all
Speaker 1: at around the world. How do you make a six
Speaker 1: month holt happen where all the stakeholders comply. It's an
Speaker 1: uphill battle, certainly. I don't think even the creators of
Speaker 1: the letter are overly optimistic. It's a big coordination problem.
Speaker 1: But we're hopeful that all the parties around the world
Speaker 1: will see the benefit of this type of pause, which
Speaker 1: I don't think holds back technology more broadly. You know,
Speaker 1: Caroline Kevin is a participant in this industry. Last week
Speaker 1: we had VCS academics who all basically said the same,
Speaker 1: This is really hard to pull off six months get
Speaker 1: everyone to participate. Can I be Kevin? Therefore, just digging
Speaker 1: a little bit as to why you, a founder of DPAI,
Speaker 1: are saying this because could I be led to believe
Speaker 1: that in some way open ar is a competitive threat
Speaker 1: to you? Well, certainly they are a competitor, We have
Speaker 1: many competitors. I don't think it's because they're a competitive threat.
Speaker 1: And I think that this technology is so powerful it's
Speaker 1: not going to matter who owns it or even which
Speaker 1: country it's built in. What matters most is that it's
Speaker 1: built at all. This is such an incredibly powerful technology
Speaker 1: that I've started calling it the nuclear weapons of software. Okay, Kevin,
Speaker 1: I'm going to dive back from that a little bit
Speaker 1: because we've had academics like Emily Bender of University of
Speaker 1: Washington on saying, look, when you are using even the
Speaker 1: turn of phrase artificial intelligence, it just keeps doubling down
Speaker 1: on the hype. It keeps reinforcing of you that this
Speaker 1: is in some way a competitive to human thought. And
Speaker 1: then actually, look, this is a worry about disinformation, yes,
Speaker 1: but the overall power of large language models, it's Basically,
Speaker 1: it makes sense to usk because we make it intelligent.
Speaker 1: What do you say to that, to the stochastic power argument,
Speaker 1: for example, I think they're rather hollow. I think these
Speaker 1: models are absolutely intelligent. They're very general, they have advanced
Speaker 1: reasoning capabilities in many ways that are already superhuman, and
Speaker 1: it won't be long before they're superhuman and almost everything,
Speaker 1: just predicting the next word, we might use, hm, that's correct,
Speaker 1: How is that superhuman? Well, these models they know more
Speaker 1: than any single human, and they can recall the information
Speaker 1: much quicker, and then they have very similar reasoning capabilities
Speaker 1: to a human. Kevin, you're a signature to Petitian. We
Speaker 1: thank you for coming on answering our questions. Many of
Speaker 1: those signatories did not. There is an argument I'm going
Speaker 1: back to this Is this, sour great? Is this you
Speaker 1: collectively recognizing open ai is so far ahead that you
Speaker 1: need a six month period to catch up? Oh? Absolutely not.
Speaker 1: We're super impressed with what they've built. We're actually huge
Speaker 1: fans of them. We don't like view them as a threat. Particularly,
Speaker 1: we just think that this technology is way too disruptive
Speaker 1: for its own good in the present moment. Well, quickly,
Speaker 1: I want to ask you what good has come out
Speaker 1: of this in the last five days. I think it's
Speaker 1: a great conversation starter. It's getting the world thinking in
Speaker 1: the right terms because this is this is not just
Speaker 1: like creating a new social network. This is a incredibly
Speaker 1: disruptive new technology. I would almost like in the global issue,
Speaker 1: almost like climate change, and that we have like a
Speaker 1: tragedy of the comments where all of the leading AI
Speaker 1: labs know they're creating something dangerous, but none of them
Speaker 1: really want to stop it. Really thoughtful and thought provoking.
Speaker 1: Thank you Kevin Barragona, his Deep ai founder core signatory
Speaker 1: to that key piece to worry about. So the collapse
Speaker 1: of Silicon Valley Bank has sent shock ways throughout the
Speaker 1: banking ecosystem, and it also prompted many startups to seek
Speaker 1: refuge in fintech solutions for support. Let's bringing Andrea Lamari
Speaker 1: from Manhattan Ventures Partners for more on this. Now, and Andrew,
Speaker 1: how much has fintech benefited or have we had to
Speaker 1: raise questions about its foundations and well overall ability to
Speaker 1: handle some of the inbound Yeah. So overall the world
Speaker 1: of fintech and startups has really evolved quite frankly a
Speaker 1: lot in the last few weeks. I would say generally,
Speaker 1: which is so interesting is that we're facing what many
Speaker 1: of us VC call the opposite of the sellery effect.
Speaker 1: So prior to the SVB collapse, liquidity was running rampant, right,
Speaker 1: startups were getting funding all over the place. Nowadays, startups
Speaker 1: are being a lot more cautious around what credit and
Speaker 1: debit looks like for them going forward, and that readily
Speaker 1: available capital just doesn't look as liquid right going forward.
Speaker 1: So jet generally it's a very hard time to be
Speaker 1: a fintech, but there's a lot of solutions coming to
Speaker 1: market that are really exciting. You of course have Clowner
Speaker 1: on your portfolio, you'll have some other as a fintech,
Speaker 1: which will you'll win out Because we've seen the inflows
Speaker 1: to the likes of Brecks and to some of the
Speaker 1: other Mercury banks, are they the ones that are going
Speaker 1: to be winning Yeah, So I would say startups generally
Speaker 1: have an amazing trend of trusting other startups, right. They
Speaker 1: all know that they're in the trenches together. The solutions
Speaker 1: like Klarna Mercury Brecks are offering really good low interest
Speaker 1: rate products for artups to consider to support their banking
Speaker 1: and charter that they need. So I think cash deposits
Speaker 1: are key as well as offering just a really simple
Speaker 1: solution to those end consumers. A lot of this, though,
Speaker 1: of course, said it's about confidence, not only confidence in
Speaker 1: the founders, confidence from the people putting money into these
Speaker 1: fintech's founders, confidence from the VC's writing the checks. Yeah,
Speaker 1: and there is a spectrum of confidence we've had on
Speaker 1: this program, Andrea, across the bench capital community, many actually
Speaker 1: saying no, I'm plowing on, I'm writing checks. Areas like
Speaker 1: artificial intelligence fintech activity. It won't be at twenty twenty
Speaker 1: one levels, but it's still there, is that what you're saying? Yeah, So,
Speaker 1: as the job of a venture capitalist, right, if we
Speaker 1: want to distill it down to its simplest form, our
Speaker 1: job is to write money checks and deploy that capital
Speaker 1: into startups. We can't just sit on it for too long.
Speaker 1: Though the dry powder is still there, the cautious nature
Speaker 1: of running a due diligence process has grown ever more present.
Speaker 1: And I would say just generally the startup. If the
Speaker 1: startups are getting the funding, I would say generally too,
Speaker 1: though it's that they can't just rely on those depth
Speaker 1: facilities anymore as a backstop relative to what they were
Speaker 1: getting in venture equity dollars. So, yeah, the vcs are deploying,
Speaker 1: they just aren't deploying as quickly as you said. Ed
Speaker 1: later in the program, we're going to be talking about
Speaker 1: man's return to the Moon around the moon, at least
Speaker 1: with artemists too. You were quite early, relatively speaking into SpaceX.
Speaker 1: Lots of reports at the moment about the saudis looking
Speaker 1: at investing in SpaceX. What's your read on the valuation
Speaker 1: of that company and why it's still attractive to you.
Speaker 1: So SpaceX overall is one of the strongest companies we
Speaker 1: see in deploying what is going to be some really
Speaker 1: Michigan critical launches, and I think generally where the big
Speaker 1: belief we have in seeing a massive upside potential, though
Speaker 1: obviously it's still a private company and we have to
Speaker 1: see where it goes, is their ability to deploy launches
Speaker 1: successfully at a very high velocity in the coming years.
Speaker 1: I think there's a lot of preeminent positivity around Elon's
Speaker 1: ability to do so, and so far their success rate
Speaker 1: relative to other companies building mission launches has been much
Speaker 1: higher and much more repeatable than others. So overall that
Speaker 1: overhead is still high. They're going to need to keep
Speaker 1: raising money. We definitely imagine several more rounds of venture
Speaker 1: funding to go there. But in terms of success and
Speaker 1: conversion rate to successful launches, it's been elon and we
Speaker 1: continue to believe. So when you are at the moment
Speaker 1: seeing companies having to raise money, a lot of them
Speaker 1: are doing it either at flat valuations, some of them
Speaker 1: doing down rounds. We are hearing those of some companies
Speaker 1: that have cut their valuations from a fourign nine a
Speaker 1: perspective and then maybe trying to raise them again. I
Speaker 1: know instacots in your portfolio. What do you make of well,
Speaker 1: companies that are having to realign the benchmark of how
Speaker 1: you value them. Yeah, so I would say generally, right,
Speaker 1: that concept of the foreign nina or that internal valuation
Speaker 1: that start upset is something that they utilize to create
Speaker 1: a price to issue stock options to new incoming employees. Now, initially,
Speaker 1: when startups start doing that value they do it typically
Speaker 1: about once a year. Then, as a company grows and
Speaker 1: it gets closer to a formal exit event, that valuation
Speaker 1: and that four ownA is typically done typically more often
Speaker 1: than once a year, two or three times a year.
Speaker 1: So what that means is a company like instacart might
Speaker 1: be doing their valuation reporting based on obviously the reports,
Speaker 1: we're seeing a lot more than once a year in
Speaker 1: that level of frequency. So with that said, we definitely
Speaker 1: expect companies who experience high growth in quarterly increments or
Speaker 1: even in half year increments to see that fluctuation in
Speaker 1: their internal four and A valuations as material things and
Speaker 1: milestones happen within a company, So I would definitely expect
Speaker 1: that we see that kind of gyration happen across many
Speaker 1: of the later stage startups that are doing more frequent
Speaker 1: four ownin as how close for instacot is an exit? Therefore,
Speaker 1: do you think? Well, generally, you know, as I said,
Speaker 1: the closer you do get to an exit, the more
Speaker 1: frequent these foreigner evaluations do occur internally. So I would
Speaker 1: say typically companies that are on the cusp of a
Speaker 1: one year out to give or take duration do make
Speaker 1: sense to be doing those valuations at this level of frequency,
Speaker 1: So that seems likely. I think a company like Instacart,
Speaker 1: like many others in the late stage, have really stacked
Speaker 1: their executive team and their product suite to be ready
Speaker 1: to face the public market and provide a really compelling
Speaker 1: narrative going into their IPO. So I think generally everyone's
Speaker 1: just rooting for them, and if it's not them, then
Speaker 1: one of the other large late stage companies to come
Speaker 1: in and be a strong catalyst for the IPO growth
Speaker 1: this year Manhattan, ben Ja Parton as Andrew Lamar, grateful
Speaker 1: for your time coming rust from Frederico. Thank you now.
Speaker 1: A bipartisan group of US lawmakers is taking their concerns
Speaker 1: about China to California this week, where they plan to
Speaker 1: meet with top tech and entertainment executives as well as
Speaker 1: with Taiwan President sighing when. The group is being led
Speaker 1: by Representative Mike Gallagher of Wisconsin, who chairs a new
Speaker 1: House panel focused on China, and it will meet on
Speaker 1: Thursday with some prominent vcs including Mark Andreeson and theod COOSLA,
Speaker 1: as well as executives from Google, Microsoft and Palenter and
Speaker 1: Apple Zone CEO Tim Kirk joining us with more. Bloomberg's
Speaker 1: Dan Flatley out of Washington, folks, out of your neck
Speaker 1: of the words, gone on the road to my neck
Speaker 1: of the Woods. What will they talk about. Yeah, that's right.
Speaker 1: I mean I think one of the ways to sort
Speaker 1: of think about this is kind of like a soft
Speaker 1: power tour. So Congress is in recess over the next
Speaker 1: couple of weeks here in DC. Lawmakers are looking for
Speaker 1: something to do, and they have kind of a natural
Speaker 1: reason to be in California this week because the President
Speaker 1: of Thailand excuse me, President of Taiwan and her visit
Speaker 1: to California this week. So they are there in part
Speaker 1: to meet with her, but also to sort of do
Speaker 1: it a bit of, as I said, a soft power
Speaker 1: tour and meet with some folks in Hollywood, eat with
Speaker 1: some folks in Silicon Valley, and sort of make the
Speaker 1: case to them that China represents a real threat in
Speaker 1: their view, but also to listen to what they have
Speaker 1: to say and sort of understand a bit more about
Speaker 1: their market concerns and why they want to be certainly
Speaker 1: in business in China, and how they're thinking about and
Speaker 1: approaching their you know, their upcoming projects and things of
Speaker 1: that nature. And don do we expect them to mainbe
Speaker 1: be preaching to the converted. We know that Venokosla has
Speaker 1: been in Washington for example, with Peter Teal flagging the
Speaker 1: concerns that they share around China. Yeah, I think there's
Speaker 1: definitely going to be an element of that. On Thursday,
Speaker 1: they're going to be having lunch at Stanford University with
Speaker 1: some folks that you know may have a more hawkish
Speaker 1: view on China, but you know, when they're going to
Speaker 1: be meeting with folks like Tim Cook or Bob Iger
Speaker 1: at Disney and Tim Cook at Apple, they're going to
Speaker 1: be talking to people who have really serious vested interests
Speaker 1: in the Chinese marketplace, who may have a bit of
Speaker 1: a different view and have the influence to talk to
Speaker 1: lawmakers in a way that they may not be used
Speaker 1: to being talked to, quite frankly, in a lot of respects,
Speaker 1: because they're going to be hearing from folks who want
Speaker 1: to continue those business lines into China and are going
Speaker 1: to be talking to them in a way that you
Speaker 1: know is going to be sort of informal. So it's
Speaker 1: not going to be a congressional hearing, but it's going
Speaker 1: to be i would say, probably a pretty strong exchange
Speaker 1: of views down how bipartisan does this run? At this point,
Speaker 1: I think concerns about China are about as bipartisan an
Speaker 1: issue as you can find on Capitol Hill. Republicans and
Speaker 1: Democrats don't agree on a lot these days, but they
Speaker 1: certainly agree on that. I think that there are some
Speaker 1: variations though, when you get down to how aggressive some
Speaker 1: folks want to be. There are certainly no shortage of
Speaker 1: hawks on the issue on either side of the aisle.
Speaker 1: But the Republicans tend to be a little bit more
Speaker 1: aggressive in terms of what they want to do, the
Speaker 1: Democrats a little bit more circumspect. But as we saw
Speaker 1: with TikTok recently, there was a hearing on that on
Speaker 1: the Hills. I'm sure you remember a couple of weeks ago.
Speaker 1: It goes pretty deep, and it goes across both parties,
Speaker 1: Blue based down flatly. Thank you, Caroline. Speaking of Tim
Speaker 1: kirk sly had caught my eye this Monday morning. The
Speaker 1: front cover of GQ magazine Silicon Valley's quiet visionary Tim
Speaker 1: Cook GQ Magazine, not known for his style, perhaps as
Speaker 1: Steve Jobs, was really interesting. Read a guy starting his
Speaker 1: day at five am, going through emails from customers the gym,
Speaker 1: and then running the biggest tech company in the world.
Speaker 1: What do you make of that? Do tell me, you're
Speaker 1: only halfway through the article because it's quite a long,
Speaker 1: it's endlessly long. But the point of it is he's
Speaker 1: so understated. Yeah, you know, we know very little about
Speaker 1: the man. He's not a big social media user ala
Speaker 1: Elon Musk or something like that, and someone who was
Speaker 1: always very upfront the saying doesn't feel normal. He's often
Speaker 1: been feeling like an outsider. But I think what was
Speaker 1: interesting was the way in which he was totally surprised
Speaker 1: by the journalist perspective that people might scatter when he
Speaker 1: walks into a room. He clearly still has that approachable nature,
Speaker 1: people wanting to sit near him, not being intimidated in
Speaker 1: some way. Well, there was an anecdote from Eddie Q,
Speaker 1: who leads the services, saying that he has four faces.
Speaker 1: He'd be brilliant at poker if he played, And I
Speaker 1: think that says everything. You never quite know, even to
Speaker 1: his closest allies in that company, what he's thinking. Maybe
Speaker 1: we should ask for a game. I'm quite into poker
Speaker 1: at the moment. Meanwhile, coming up, we'll bring you the
Speaker 1: details on the first of NASA's new mission to the Moon,
Speaker 1: with the astronauts just being named this morning. We're on
Speaker 1: that next and now earlier we are discussing AI. So
Speaker 1: let's just take a quick look at Baidu China. The
Speaker 1: skepticism we're just talking about, of course going to Capitol Hill,
Speaker 1: Capitol Hill lawmakers coming to California to talk China. But
Speaker 1: there's also skepticism around the power Baidu and it's chat
Speaker 1: GPT competition of course, the only bot will it really
Speaker 1: be able to substantiate some of the run up in
Speaker 1: the shares that we've seen of late down percent of
Speaker 1: the day. The Agremberg NASA's name, the group of astronauts
Speaker 1: it's sending to venture around the Moon on Artemus too.
Speaker 1: It's the first crewed mission on NASA's path to establishing
Speaker 1: a long term presence on the Moon, and we'll launch
Speaker 1: in November of twenty twenty four at the earliest spoon bags.
Speaker 1: Lauren grush is out in Houston. Was the announcement. Who's
Speaker 1: heading to the Moon? Lauren right, So it's actually a
Speaker 1: really star stutted crew that announced a name. Today. We
Speaker 1: have two mission specialists, Christina Cook and Jeremy Hanson of Canada,
Speaker 1: and Christina's with a NASA astra and then we have
Speaker 1: pilot Victor Glover and Commander Red Wiseman, and just some
Speaker 1: notable things to point out about this crew. Christina Cook
Speaker 1: will be the first woman to go to deep space,
Speaker 1: Victor Glover the first person of color to go to
Speaker 1: deep space, and Jeremy will be the first non American
Speaker 1: astronaut to go to beeB space. So it's going to
Speaker 1: be a very historical mission for sure, historical performing on
Speaker 1: a Luna fly by. We understand schedule for next year.
Speaker 1: Just tell us where we are in the process of
Speaker 1: well getting back there, right. So last year I was
Speaker 1: at the Artemis one launch, So that was the very
Speaker 1: first mission, the main big mission in the Artemis program,
Speaker 1: which is to get back to the Moon, and that
Speaker 1: one tested out the main flight hardware that will be
Speaker 1: sending humans into these days. And now it's time to
Speaker 1: put people on that hardware. So now that that mission
Speaker 1: went well, we're going on to Artemis two and these
Speaker 1: four astronauts will ride inside NASA's O'Ryan capsule on top
Speaker 1: of the massive SLS rocket and that will take them
Speaker 1: around the Moon and back to test it out ahead
Speaker 1: of the historical landing that will hopefully happen sometime this decade.
Speaker 1: Right now, it's scheduled for twenty twenty five. We'll see
Speaker 1: if that happens. But eventually that will be the landing
Speaker 1: on the Moon. So unfortunately these astronauts won't be howd
Speaker 1: you now in the service book, they'll still be paving
Speaker 1: a really important road with the ash shot ahead. Lauren
Speaker 1: great speaking with you. Try and call down tern of course, Texas,
Speaker 1: Lauren Grush. We thank her, and I mean not the
Speaker 1: only bit of aerospace news upon us. It feels as
Speaker 1: though we're talking SpaceX earlier with Manhattan Ventures. And also
Speaker 1: that looks like there's a competitor on the scene right
Speaker 1: end when it comes to SpaceX. Hanwa am I saying
Speaker 1: it right? Hanwa Aerospace bringing the South Korean's first commercial
Speaker 1: rocket and it's a pretty ambitious target. Yeah, so they
Speaker 1: want to match SpaceX in price, getting payload to orbit
Speaker 1: at the same price. But this is really fascinating because
Speaker 1: they are borne out of arms sales. This is an
Speaker 1: aerospace conglomerate essentially that's making money selling arms to Ukraine
Speaker 1: in that conflict and putting the proceeds back into space exploration. Ambitious,
Speaker 1: but this is a sector Carr that we're going to
Speaker 1: cover increasingly because it's not just the money that's going
Speaker 1: into it, global interest taking off. Knew you'd get a
Speaker 1: pun in there somehow, And what a joy to be
Speaker 1: reconnected once again back on the show that this edition
Speaker 1: of Bloomberg Technology. Yeah, and there is a lot to recap.
Speaker 1: Don't forget the podcast wherever you get your podcast, Apple, Spotify.
Speaker 1: I heart Bloomberg so much to discuss this week in
Speaker 1: the world of tech. This is Bloomberg