Speaker 1: This is Bloomberg Business Week. I'm Carol Masser and I'm
Speaker 1: Bloomberg Quick Takes Tim Stanovik. We're here every day bringing
Speaker 1: you the latest news from the world to business and finance,
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Speaker 1: at two pm Eastern Time on the Bloomberg Radio or
Speaker 1: watch us on YouTube. Searched Bloomberg clovel News well handful
Speaker 1: of headlines when it comes to the fight against COVID
Speaker 1: nineteen in the United States and around the world. Pretty
Speaker 1: we mentioned that there is a panel of scientists from
Speaker 1: around the world who've been cautioning that most people won't
Speaker 1: actually need a booster shop because vaccines are performing so well.
Speaker 1: In the meantime, we do see on the Bloomberg Vaccine
Speaker 1: Track or more than five point seven one billion doses
Speaker 1: have been administered cases those are passing two four point
Speaker 1: seven million deaths exceeding four point six three million let's
Speaker 1: get into it with Dr lager Day Williams, chief of
Speaker 1: Staff of Neurology at Columbia University, also the founder of
Speaker 1: Hip Hop Public Health. The organization works to deliver positive
Speaker 1: health behavior change through the transformative power of music, art
Speaker 1: and science. Dr Williams, it's great to have you back
Speaker 1: on the show. I should know Bloomberg Philanthropies has provided
Speaker 1: a grant to Hip Hop Public Health. Uh, what I
Speaker 1: want to start with the booster news? Dr Williams, Where
Speaker 1: do you fall when it comes to whether or not
Speaker 1: we need boosters? Well, I I think that we the
Speaker 1: general population. I don't think that's compelling evidence to support
Speaker 1: UM the fact that the general population needs booster shots. However, UM,
Speaker 1: I do support UM booster shots for certain populations, especially
Speaker 1: those who are immuno compromise UM and and more. What
Speaker 1: about age? Does does age? Where does general population fall
Speaker 1: when it comes to age? Should people over the age
Speaker 1: of sixty or sixty five? Yeah? I think yeah, yeah,
Speaker 1: I there's not enough compelling evidence outside of those who
Speaker 1: have really weak immune systems UM to you know, to
Speaker 1: receive the booster And even those situations, I think the
Speaker 1: booster is not really looked at as a booster shot,
Speaker 1: but a third dose UM as opposed to a true
Speaker 1: booster where we we really don't have sufficient effortency. You know,
Speaker 1: what we're seeing is that there is UH, you know,
Speaker 1: there is a difference between falling antibody levels and vaccine efficacy.
Speaker 1: And we we know you know from immunology that UM,
Speaker 1: you know, mild disease is more dependent on you know,
Speaker 1: protection from these neutralizing antibodies. However, more severe disease UM
Speaker 1: you know, involves not just your humor le or humoral
Speaker 1: immune system, which is in the neutralizing antibodies that people
Speaker 1: are also concerned about that are falling to vie a
Speaker 1: disease also involved memory responses in another type of immunity
Speaker 1: called cell mediated immunity UH and the cell mediated community
Speaker 1: and these many memory responses have generally have a longer,
Speaker 1: longer lived lifespan. And so we are going to see
Speaker 1: breakthrough cases that we are going to see some mild disease,
Speaker 1: but the vaccines are still pretty good at keeping people
Speaker 1: out of the hospital and preventing to VIA disease. Dr
Speaker 1: Williams to be a great point about that. Essentially, this
Speaker 1: idea that when you do take the vaccine, your your
Speaker 1: symptoms become a lot less severe, But does that also
Speaker 1: lead to potentially a more like a larger likelihood of
Speaker 1: contracting the virus simply because you do have your guard down.
Speaker 1: I believe there was a study coming out of I
Speaker 1: want to say Scotland or the UK really really where
Speaker 1: they started to see a lot of the new new
Speaker 1: virus cases coming or happening in people that were actually vaccinated.
Speaker 1: How do you how do you kind of think about that? Well,
Speaker 1: my my biggest con earn is remains the unvaccinated. Uh
Speaker 1: that that is my biggest concern, the unvaccinated and also um,
Speaker 1: the you know countries around the world where they don't
Speaker 1: even have um, they don't even have vaccines available for
Speaker 1: their populations. I'm concerned about those two situate situations for
Speaker 1: the same reason. One, I think the focus on on
Speaker 1: you know, getting booster shots, you know, has kind of
Speaker 1: clouded um, it kind of begins to slowly eclipse the
Speaker 1: more serious issue, which is getting the unvaccinated vaccinated, because
Speaker 1: that is where the real threat lies. You know, we
Speaker 1: know that the vaccine because it's sufficient to prevent severities
Speaker 1: even now. But what we also know is that the
Speaker 1: cases we're seeing in our hospital. As of today, we
Speaker 1: have two d and twenty cases of COVID in our
Speaker 1: in our hospital where I am. I'm at New York
Speaker 1: Vegetarian Columbia. Thankfully, our cases seem to be PLATEAUNG. But
Speaker 1: one of the things that's completely unequivocal is that ninety
Speaker 1: nine percent of our cases are among the unvaccinated um
Speaker 1: you know, break the breakthroughs that we see a type
Speaker 1: typically in the outpatient setting, people coming to the officers,
Speaker 1: they have a little mild infective breakthrough and they go
Speaker 1: they go home, and they quarantine, etcetera, etcetera. But the
Speaker 1: real threat is that, yes, you know, with the delta variant,
Speaker 1: we can be carriers of this of the virus even
Speaker 1: if we're asymptomatic or exhibiting mild disease. But if we
Speaker 1: come across the unvaccinated individuals, they can be severely get
Speaker 1: severely sick from this disease to and potentially die. And
Speaker 1: that is what we're seeing today. And so our emphasis,
Speaker 1: in my opinion, needs to really focus on those unvaccinated
Speaker 1: people because they're the ones that are most vulnerable to
Speaker 1: getting sick and dying in the hospital and on the
Speaker 1: same note, we also need to pay attention to some
Speaker 1: to some of some of our low middle income countries
Speaker 1: because you know, if that's where we're more likely to
Speaker 1: get a new variant, another new area appearing um and
Speaker 1: and potentially causing havoc around the world. R. Williams, you
Speaker 1: make a great point about simply there's the divergence that
Speaker 1: you're seeing between those emerging markets and developed markets. I
Speaker 1: want to very quickly ask you if what you're seeing
Speaker 1: in kind of the emerging market space where they are
Speaker 1: really trying to kind of accelerate their vaccinations, what does
Speaker 1: the time frame look like to really do that well.
Speaker 1: I think a lot of a lot of these low
Speaker 1: middle income countries they have they're really crippled by poor
Speaker 1: infrastructure UM and you know, poor testing capabilities for infrastructure,
Speaker 1: poor backing distribution capability. That is a real challenge. And
Speaker 1: and but a lot of these governments are really trying
Speaker 1: uh to kind of ramp up their infrastructure, and they're
Speaker 1: getting some support from from the international community now and
Speaker 1: we're seeing, uh, you know, more vaccines arrived in some
Speaker 1: of these countries. I want to get right back to
Speaker 1: Dr lager Day Williams, Chief of staff of Neurology at
Speaker 1: Columbia University. Also the founder of Hip Hop Public Health.
Speaker 1: Bloomberg Filancer has provided a grant to hip Hop Public Health.
Speaker 1: The organization works to deliver positive health behavior changed the
Speaker 1: transformative power of music, art and science. Dr Williams, I
Speaker 1: want to get an update from you about what has
Speaker 1: worked and what has not been working when it comes
Speaker 1: to getting communities of color vaccinated. If I look at
Speaker 1: New York City statistics, I can see that uh, black
Speaker 1: and Hispanic or black UM demographically, blacks only here of
Speaker 1: all ages who are eligible to be vaccinated in the
Speaker 1: city have gotten vaccinated. That compares to eighty percent of Asians,
Speaker 1: fifty seven percent of Hispanic and Latinos, and fifty of whites.
Speaker 1: Give us an update from your end. Yeah, Well, the
Speaker 1: good news is that the numbers are going up. Um.
Speaker 1: We we've seen these numbers go up, especially over the
Speaker 1: last a few months. Um and um. And I expect
Speaker 1: that these numbers to continue to rise. And and I
Speaker 1: think it's a it's it's a combination of up with
Speaker 1: the factors that are driving these these rising vaccination rates.
Speaker 1: I think one of them is dis continued you know,
Speaker 1: ground ground. Uh, you know, grassroots, you know, one on
Speaker 1: one counseling just just completely overwhelming. Uh. You know the media,
Speaker 1: you know, community organizations, getting our churches on board, working
Speaker 1: one on one with individuals just to the message has
Speaker 1: become almost ubiquitous now in that and these conversations have
Speaker 1: been you know, have been really supported by some of
Speaker 1: the mandates, you know, the sticks that are coming into
Speaker 1: play across New York City where employers, including where I
Speaker 1: am right now, are now mandating the vaccine. Dr Williams,
Speaker 1: just in the last minute that we have with you,
Speaker 1: can you talk a little bit about the success of
Speaker 1: Community Immunity and the follow up that you're working on
Speaker 1: in just a couple of weeks. Sure. Yeah, we're so
Speaker 1: excited by Community Immunity UM. It's been received across the country.
Speaker 1: Multiple organizations are are sharing this resource, community organizations, community
Speaker 1: health workers. Uh. And what we're seeing is this really
Speaker 1: sparkling a lot of conversations. Uh. And it's really we believe,
Speaker 1: helping to move the needle that we're seeing not only
Speaker 1: in New York City but across this country. We recently
Speaker 1: added a new video on the variant um and which
Speaker 1: we released recently and our most recent project is the
Speaker 1: big launch of our Spanish community Immunity series and we're
Speaker 1: very very excited about that. And when does that one launch?
Speaker 1: That will be launching within the next next few weeks,
Speaker 1: so please um stay tuned, UM and UM, we will
Speaker 1: be making some announcements very soon UM. And we're very
Speaker 1: very excited by this because we think it not only
Speaker 1: has direct uh, it's not only important for this country,
Speaker 1: but I think it could also help with some of
Speaker 1: our Latin South American countries in our lands, that Spanish
Speaker 1: speaking countries surrounding us. Dr large Day Williams, it is
Speaker 1: always great when you join us. Thank you so much
Speaker 1: for taking the time. Dr Williams, Chief of Staff of
Speaker 1: Neurology at Columbia University, also the founder of Hip Hop
Speaker 1: Public Health. Bloomberg Philanthropies has provided a grant to hip
Speaker 1: Hop Public Health is an organization that works to deliver
Speaker 1: positive health behavior change through the transformative power of music,
Speaker 1: art and science. This is Bloomberg Business Week with Carol
Speaker 1: Masser and Bloomberg Quick Takes Tim Stinovic on Bloomberg Radio.
Speaker 1: So you might remember just a few months ago after
Speaker 1: Elon England that lost to Italy in July and the
Speaker 1: final UEFA European Championship, black players for the British side
Speaker 1: faced an onslaught of bananas. It wasn't physical fruit, they
Speaker 1: were emoji slung at their social media profiles, along with
Speaker 1: other racist imagery, including images of monkeys. With us now
Speaker 1: is Joel Weber, editor at Bloomberg Business weekis with us
Speaker 1: in the Bloomberg Interactive Broker studio. Also joining us Ivan Levingston,
Speaker 1: European tech and advertising reporter at Bloomberg News. He joins
Speaker 1: us on the phone from London. Joel, Whenever I read
Speaker 1: a story like this, I think to myself, I thought,
Speaker 1: we had the best and brightest working for these companies.
Speaker 1: How can they not get these get this type of
Speaker 1: content moderation under control. Well, it's one thing when it's words,
Speaker 1: which I think is a struggle in and of itself,
Speaker 1: and something that the tech companies have done a reasonable
Speaker 1: job of at least attempting to address. But emojis bring
Speaker 1: up a whole other challenge, and I thought that that
Speaker 1: was interesting, especially just because of the One of the
Speaker 1: interesting things about this article I found was even just
Speaker 1: a history of of bananas and once upon a time.
Speaker 1: Thirty years ago, there was there was an episode that
Speaker 1: the story goes into where physical bananas were used, and
Speaker 1: now obviously we're talking digital ones. So I then talk
Speaker 1: to us about emojis and why they are such a
Speaker 1: challenge for tech companies, sure saying, and you know, thanks
Speaker 1: for the interest. Um. You know, tech companies have grappled
Speaker 1: for years with abusive speech on their platform, and in
Speaker 1: some ways, emojis are just an extension of that. You know,
Speaker 1: people adapting new forms of communication into harassment. Unfortunately, it
Speaker 1: happens um and and you know, as speech and and
Speaker 1: you know, abuse adapts. Opposes a new challenge for social
Speaker 1: media companies and content moderating algorithms because these algorithms will
Speaker 1: be trained oftentimes on older texts, and so when they
Speaker 1: encounter a newer character like in emoji, they have to
Speaker 1: have to start from scratch essentially and figuring out what
Speaker 1: it means. So I've even heard emoji's described as a
Speaker 1: sort of a loophole because the algorithms are a little
Speaker 1: bit behind on analyzing them. That's really interesting. How do
Speaker 1: you really tackle something like this in a world where
Speaker 1: pictures are always evolving, when their messages are constantly evolving,
Speaker 1: especially in this climate. How does a tech company actually
Speaker 1: manage this? Is it just about the algorithms or do
Speaker 1: you actually have to have kind of the human component
Speaker 1: in it a little bit? Yeah, I mean that's that's
Speaker 1: something I explored in the story. I think. On the
Speaker 1: one hand, you know, defenders of the tech company will
Speaker 1: say that that emojis are very complex. Understand, you know,
Speaker 1: pictures work a thousand words. Uh you know, is a
Speaker 1: winky face a flirtation or suggesting a joke? Um. On
Speaker 1: the on the other hand, um, perhaps is the place
Speaker 1: where human moderators and and some kind of basic uh
Speaker 1: you know, ground rules I guess can can play a part.
Speaker 1: You know, maybe an algorithm that might take millions of
Speaker 1: examples to understand if an emoji is being used appropriately
Speaker 1: or not. The human moderator might be able to very
Speaker 1: quickly make that doesn't call and help train the algorithm,
Speaker 1: or you know. I interviewed a startup called Respondology that
Speaker 1: works with a lot of sports organizations, and they offer
Speaker 1: a very simple screening tool where you can say, okay,
Speaker 1: these are some emojis that we just don't want on
Speaker 1: our athletes profiles, and just we're not going to worry
Speaker 1: about what do they mean in this context of that
Speaker 1: we're just gonna kind of blanket hide these comments. So
Speaker 1: where specifically do the tech platforms will come into this?
Speaker 1: What did what did Facebook the company that Instagram tell you?
Speaker 1: And what about Twitter? Um? You know, they they stressed that,
Speaker 1: you know, they're worried about all abusive speech, including emojis, UM,
Speaker 1: and that they were you know, active in the hours
Speaker 1: um after the Euro's football match. UM. But it's it's
Speaker 1: hard to really know what's going on inside the black
Speaker 1: box in terms of, uh, you know, how they're tweaking
Speaker 1: the algorithms to tackle emojis and and are there you know,
Speaker 1: you mentioned a couple in the story and obviously we've
Speaker 1: mentioned a couple already that that um our emojis that
Speaker 1: can be you know, used for for hate and and
Speaker 1: is that is there sort of like is anyone keeping
Speaker 1: score about like what the ones that are are the
Speaker 1: worst are? And is one of the solutions simply to
Speaker 1: like in a moment where something is trending, just to
Speaker 1: make it not available anymore. Yeah, I think, um, I
Speaker 1: think you know, Facebook, that's one of the things that
Speaker 1: they're doing, is they've added a few classic strings of
Speaker 1: emojis that are used almost always in in uh an
Speaker 1: abusive way. UM, but sounds like a no fly list. UM.
Speaker 1: I haven't seen any kind of score, but unfortunately UM
Speaker 1: that that we would even need one. But UM, you know,
Speaker 1: I think like the monkey emoji, the banana emoji, these
Speaker 1: are um, you know, classic used in racist ways. And
Speaker 1: I also mentioned the piece, um you know, the money
Speaker 1: bag emoji. I think I saw the yellow star emoji
Speaker 1: had been linked to you know, anti Semitic incidents. What's
Speaker 1: and what's crazy here is also that professional athletes end
Speaker 1: up being the ones that are are targeted the most,
Speaker 1: and obviously they're high profile and have huge social following,
Speaker 1: so it's sort of some extent it makes sense there.
Speaker 1: But has there been noteworthy sort of hate UM directed
Speaker 1: at anybody else that has caught UM attention of the
Speaker 1: network of the social social media companies and tech companies. UM.
Speaker 1: To be honest, when I was searching, UM, you know,
Speaker 1: in terms of very recent the soccer players actually found
Speaker 1: to be kind of the of the sphere on this
Speaker 1: UM you know, it's been going on for a couple
Speaker 1: of years, but there seems to be a real issue, um,
Speaker 1: in terms of soccer players getting an abusive emojis on
Speaker 1: social media, and I thought it was really interesting. I mean,
Speaker 1: it's not only limited to the soccer. Again, this startup
Speaker 1: respondology that works with sports teams, uh, you know, their
Speaker 1: president was telling me that when they go and they
Speaker 1: work with the Detroit Pistons, the NASCAR, and their president
Speaker 1: was telling me, you know, when we sit down with
Speaker 1: sports executives, emojis almost always, you know, come up pretty quickly.
Speaker 1: It's it's a widespread issue for athletes. I and let's
Speaker 1: take this international here, because we're talking about a European championship.
Speaker 1: Things mean different, Different pictures mean different things in various countries,
Speaker 1: in various part of the world. Did you come across
Speaker 1: your reporting basically how some of these international tech companies
Speaker 1: or are translating, for example, these international messages, like you said,
Speaker 1: a banana emoji, for example, might mean something different in
Speaker 1: the UK might mean something completely different. And let's say
Speaker 1: Southern Asia for example. UM yeah, I mean I was
Speaker 1: actually discussing with someone today an example of um, you know,
Speaker 1: a player, a player whose nickname is the gorilla. Apparently
Speaker 1: I wasn't aware of this example, but his nickname is
Speaker 1: the Gorilla, and I guess, um, you know, there were
Speaker 1: issues with people kind of cheering him on posting gorillas
Speaker 1: on his page, and uh, you know these comments, I
Speaker 1: guess for being deleted because they were being taken at
Speaker 1: the time of abuse when they really weren't. So it's
Speaker 1: it's certainly a nuanced issue. UM And again asking I
Speaker 1: mentioned the piece, Uh, you know a few other kind
Speaker 1: of examples in the past, like you know Apple about
Speaker 1: five years ago. I think there was encouragement, uh you know,
Speaker 1: allow for you have different skin tones emojis and UM,
Speaker 1: and then they ended up being some criticism that actually
Speaker 1: allowing different tone emojis created, you know, enabled new kinds
Speaker 1: of um abuse and and the Indonesian government. Yeah, it's
Speaker 1: we're gonna have to leave it there. But this is
Speaker 1: a story that everybody should check out. It's available at
Speaker 1: Bloomberg dot com. Ivan Lemmingston European tech and advertising reporter.
Speaker 1: His story will be featured in the upcoming issue of
Speaker 1: Business Week magazine. Read it now on the Bloomberg and
Speaker 1: at Bloomberg Duck hom Slash business Week. Also joining us
Speaker 1: Joel Webber, editor of Bloomberg business Week. This is Bloomberg.
Speaker 1: You're listening to Bloomberg Business Week with Carol Masser and
Speaker 1: Bloomberg Quick Takes Tim Stenovy on Bloomberg Radio. It's Bloomberg
Speaker 1: Business Week, Tim stane A and Credy Gupta live in
Speaker 1: the Bloomberg Interactive Broker's studio. These stories continue to come
Speaker 1: out of China. We are fortunately joined by Andy Brown,
Speaker 1: editorial director at Bloomberg New Economy. He joins us on
Speaker 1: the prone from New Hampshire. Andy, your your Saturday Bloomberg
Speaker 1: New Economy newsletter, you write about After President Hi Jan
Speaker 1: Pain came to power in twelve, he made it known
Speaker 1: that he wanted to turn China into a soccer superpower,
Speaker 1: host the World Cup and win it. Responding to that challenge,
Speaker 1: some of China's richest tycoons developed a passion for the
Speaker 1: quote beautiful game, and they splashed out on soccer clubs
Speaker 1: and star players. But today the fortunes of the tycoons
Speaker 1: who sought to cry favor with she they are sinking fast.
Speaker 1: What's going on? Yeah, So this is a sort of
Speaker 1: a little morality tale if you like. As you just note,
Speaker 1: he comes to power and and he wants to turn
Speaker 1: around Um Chinese soccer, and the Billy and some of
Speaker 1: the richest tycoons in China decide that they want to
Speaker 1: ingratiate themselves with him by investing massively in soccer the game,
Speaker 1: both in China and overseas, and they set up clubs
Speaker 1: that you know, attract players from the top clubs in
Speaker 1: Europe and Latin America. UH. And the best example is
Speaker 1: a prime example is Guangzo ever grand Um, which was
Speaker 1: set up by Shijayen the term of of Evergranded massive
Speaker 1: real estate conglomerate conglomerate and Ali Bapa's Jack Ma. So
Speaker 1: this whole effort has basically blown up UM. The Chinese
Speaker 1: men's soccer team is about as pitiable today as it
Speaker 1: was when Shi Jimping took power. It ranked something like
Speaker 1: seventy in the world versus seventies seventh twenty when he
Speaker 1: took over. UM. It's just about to crash out of
Speaker 1: the World Cup qualifiers, lost one nail to Japan. Meanwhile,
Speaker 1: billionaires as a class out of favor UH in China
Speaker 1: and in particular Jack mar is in trouble. So what
Speaker 1: is the international reaction to this? I mean, you talked
Speaker 1: about one in your in your commer should say one
Speaker 1: foreign signing such as Colombian Stricord Jackson Martinez. So, I mean,
Speaker 1: people know this is happening. What has the international fallout
Speaker 1: been like? This is this is really apart from the
Speaker 1: fact that China is not the global soccer superpower that
Speaker 1: Chi Jim being hoped it would be. Um, this is
Speaker 1: really a domestic story where um Si jimping is now
Speaker 1: uh decided that he's seen enough of the of seeing
Speaker 1: wealth being generated by a relatively small number of billionaires
Speaker 1: and although a number that is increasing very rapidly um
Speaker 1: and he wants them to give back and they're being
Speaker 1: shaken down for billions of dollars to promote what equals
Speaker 1: common prosperity or a more equipible society. So Andy, connect
Speaker 1: this to what's happening with the Evergrand Crisis. As it
Speaker 1: escalates this protests breakout across China. The group is facing
Speaker 1: mountain protests by homebuyers, retail investors, and even its own employees,
Speaker 1: raising the stakes for authorities in Beijing as they try
Speaker 1: to prevent the property giants debt crisis sparking social unrest. Yeah,
Speaker 1: this is a this is a different aspect of the crisis.
Speaker 1: This is the government deciding that it wants to reign
Speaker 1: in the debt of China's biggest property companies um and
Speaker 1: it is it's taking out a swath of billionaire profits
Speaker 1: and wealth. The latest, the latest billionaire couple actually to
Speaker 1: run into trouble the husband and wife power couple John
Speaker 1: Keen and Panther, the co founders of the Soho China,
Speaker 1: which is one of China's primary office and retail property developers.
Speaker 1: They had tried to sell the comp their company to
Speaker 1: black Stone Stephen Schwartzman's Black Stones for three billion dollars,
Speaker 1: and that deal then got stuck in an anti monopoly review,
Speaker 1: and for reasons that are still unclear but probably not
Speaker 1: unconnected to that review, which was going nowhere fast, blacks
Speaker 1: own and so Hope hold the plug. On Friday today
Speaker 1: you saw Soho China shares in Hong Kong plugs something like.
Speaker 1: I want to ask you about why the American investor
Speaker 1: should really paying attention to the story going on thousands
Speaker 1: and thousands miles away connected to us, for for for
Speaker 1: those of us who are unfamiliar, well, for two reasons.
Speaker 1: For firstly, because China is now a major investment destination
Speaker 1: for Wall Street firms. They're rushing in the China to
Speaker 1: take advantage of the country's massive pools of savings, and
Speaker 1: they want to mediate those savings create wealth management products.
Speaker 1: One day, they hope that they'll be able to to
Speaker 1: help some of that money invest overseas. But second of all,
Speaker 1: that there are a lot of two trillion dollars worth
Speaker 1: of Chinese shares which are traded in the US, and
Speaker 1: so American funds, including pension funds, pretty heavily exposed to
Speaker 1: what's happening over there. And what's happening right now is
Speaker 1: there's crackdown on the tech sector, which appears to be
Speaker 1: broadening now too much of the private entrepreneurial class in China.
Speaker 1: Is any sector safe from the crackdown? Well, you hear
Speaker 1: people like Cathy Wood of saying, you know, you've got
Speaker 1: to invest in those sectors that the government favors, and
Speaker 1: so that might be heart so called hard tech versus
Speaker 1: soft tech or consumer consumer tech. UM, it's really hard
Speaker 1: to say. I mean, you know, the crackdown has been
Speaker 1: so broad, it's covered so many sectors, from fintech to
Speaker 1: add tag to real estate. UM it's really difficult to
Speaker 1: know what exactly the government's intention is and if it
Speaker 1: really is a generally attempt to eventually soaked the rich
Speaker 1: to pay the poor. The government says it's not, but
Speaker 1: it does certainly seem to be that way. UM. Pretty
Speaker 1: much any company now that you know, has wealthy private
Speaker 1: billionaire owners is going to find itself in some way
Speaker 1: or another. UM a target. That's certainly a large number
Speaker 1: of companies and relatively large number of people as well.
Speaker 1: Andy Brown, editorial director of Bloomberg New Economy form Andy,
Speaker 1: thank you as always for taking the time. We really
Speaker 1: appreciate it, he joins us on the phone from New
Speaker 1: Hampshire Brock the Journal. Yeah but you let me drive?
Speaker 1: Oh no, no, no no, no, honey, please, I'll do the
Speaker 1: right revel exst me, I don't want to drive to drive, baby,
Speaker 1: it's the questions kept drying Greeken. This drive to the
Speaker 1: close give me things well, dry n on Blueberg Radio.
Speaker 1: It is the Drive to the close. And we're just
Speaker 1: over ten minutes away from the market close on this Monday,
Speaker 1: September another choppy session. Market really looking for direction. We
Speaker 1: do see the SMP five hundred higher, but just barely
Speaker 1: right now, not even a point. The Dow higher by
Speaker 1: close to six tenths of one percent, the Nastact though
Speaker 1: in the red, down close to three tenths of one percent.
Speaker 1: Let's get all into it with Ross Gerber, president and
Speaker 1: CEO at Gerber Kawasaki Wealth and Investment Management. He joins
Speaker 1: us on the phone from beautiful Santa Monica, California. Ross
Speaker 1: Howard things by the beach. It actually is beautiful, interesting,
Speaker 1: like it always is there. Yeah, that's a California and
Speaker 1: I know that it's always nice. Um. Hey, I want
Speaker 1: to talk a little bit about what you think has
Speaker 1: been happening in the markets, because if we do see
Speaker 1: the SMP five closed lower today, and it could it's
Speaker 1: fluctuating between positive and negative territory, it'll be a six
Speaker 1: day in a row of declines thing that we haven't
Speaker 1: stu for for months. Um, what do you make of it?
Speaker 1: I think it's great. I mean, you can't have a
Speaker 1: stock market only goes up every day. That concerns me
Speaker 1: a lot more, you know, So a healthy pullback in stocks,
Speaker 1: you know it's good because this isn't even two percent yet. Yeah,
Speaker 1: it's not really a healthy pullback. I was gonna say
Speaker 1: it's supercent pullback is not even really a pullback, most
Speaker 1: mostly a statistical anomally right. But let's say the market
Speaker 1: goes down five or ten percent, I think we get
Speaker 1: down to a value that makes sense. So we we
Speaker 1: think the SMP is worth about four thousands trading a
Speaker 1: good ten percent higher than it should. But that's mostly
Speaker 1: because of the tremendous liquidity that we have in markets
Speaker 1: in our economy right now, and and enormous levels of
Speaker 1: spending and economic activity that we're seeing across the board.
Speaker 1: So so you know, the markets can warrant a higher
Speaker 1: valuation at this time because we have an abnormal government
Speaker 1: policy at this time. So having a little bit more volatility,
Speaker 1: I think it's an advantage for investors who know what
Speaker 1: they're doing. I want to ask you, Ross, how does
Speaker 1: someone know when to actually buy this dip, because that
Speaker 1: was something that we saw year to date. We saw
Speaker 1: plenty of pullbacks less than three percent, not huge pullbacks,
Speaker 1: but pullbacks nonetheless, and people immediately bought the dip. So
Speaker 1: is this one of those times when you have kind
Speaker 1: of the seasonality of September kind of in your back pocket? Yeah? Absolutely,
Speaker 1: And so you know, I I do a lot. You know,
Speaker 1: I'm I'm kind of old now, so I do a
Speaker 1: lot of research about my you know, twenty eight years
Speaker 1: that I've been doing this as professional and many years
Speaker 1: before that as as a kid. But like when you
Speaker 1: think about what really hurts markets, So you have corrections, Okay,
Speaker 1: that's normal, you get one a year, a temper cent correction,
Speaker 1: but then you have bear markets, and you have very
Speaker 1: very difficult markets, and most of the time that's predicated
Speaker 1: by the FETE. So almost every real market declient we've
Speaker 1: had is because of the federal reserve or a banking crisis.
Speaker 1: So I don't see a banking crisis on the horizon
Speaker 1: in any way, So it's really the federal reserve. So
Speaker 1: the only thing that's gonna make stocks go down is
Speaker 1: when you take liquidity away, and so that process is
Speaker 1: going to begin with the tapering soon. But that's not
Speaker 1: even really taking liquidity away, you know what I mean,
Speaker 1: that's just like taking a ridiculous bond buying away. And
Speaker 1: so rates themselves don't even look like they're going to
Speaker 1: go up for another year. So for investors, you want
Speaker 1: to buy the depths and and keep playing the game
Speaker 1: until the FED takes the punch bowl away. What does
Speaker 1: it look like the what does the FED look like
Speaker 1: when it takes the punch bowl away? What does that
Speaker 1: look like to you? If it's not tapering, is it
Speaker 1: just raising rates? Yeah, that's raising rates. And it's usually
Speaker 1: like what do they say, it's after the third increases
Speaker 1: when it all goes downhill. And and you really can
Speaker 1: look at this historically. You can go back to the nineties.
Speaker 1: What killed the bullmark of the nineties was Alan grease Band.
Speaker 1: He killed it. And then we had September eleven, so
Speaker 1: it extended the bear market to one of the worst
Speaker 1: three year bear markets, probably one of the worst bear
Speaker 1: markets we had, and then followed by the financial cry
Speaker 1: as which was really a self created event from green
Speaker 1: and stuff, also created because of low rates and a
Speaker 1: lack of you know, oversight and such and and so
Speaker 1: when you go back to it was raising rates again
Speaker 1: and a banking crisis. So you know, like when you
Speaker 1: think about COVID, you know, when Margot was down and
Speaker 1: next thing you know, they're buying everything in sight to
Speaker 1: protect the market. I would argue that investors have a
Speaker 1: level of safety they've never had before. In the history
Speaker 1: of markets when the Federal Reserve is also out as
Speaker 1: one of their mandates to protect the stock market. So
Speaker 1: they don't say it, but that's what they're doing. So
Speaker 1: how bad of a bearer market are we really going
Speaker 1: to get before the Fed comes in and starts buying
Speaker 1: stocks or whatever? You know, Ross, It sounds like you're
Speaker 1: completely discounting, and maybe for a good reason, whether or
Speaker 1: not we even have a taper tantrum at all, what
Speaker 1: do you think? Yeah, I mean, like, once again, I
Speaker 1: I've been doing this so long in you know, their
Speaker 1: value as are elevated to a ten percent correction is
Speaker 1: warranted and I don't know when or if that's going
Speaker 1: to happen, but I don't play the game of waiting
Speaker 1: for the correction and then when there is one, I
Speaker 1: buy it, you know what I mean. But like, you
Speaker 1: just have to look at liquidity. There's so much liquidity
Speaker 1: because they just keep printing money and and and hence
Speaker 1: why cryptocurrencies are doing so well and why so many
Speaker 1: investors are moving money out of the traditional financial system
Speaker 1: into the cryptosystem. Rosse. Let's transition from the macro picture
Speaker 1: to the micro picture, because I have a really interesting
Speaker 1: piece in my notes here say like, you want not
Speaker 1: only own shares of Tesla, but you have a Model three.
Speaker 1: I'm curious and I've been dying to ask this question
Speaker 1: to someone who looks at individual stocks. How do you
Speaker 1: value how do you price a stock like Tesla, or,
Speaker 1: for that matter, any electric vehicle maker. Well, a full disclosure.
Speaker 1: I got the Model as plaid recently in June and
Speaker 1: sold the Model three for Yeah, I sold it for
Speaker 1: five thousand dollars less than I bought it for after
Speaker 1: driving it for three years. So was the best return
Speaker 1: I've ever had on a car. I was like, built
Speaker 1: equity in my car. Like, that's how cool this ev
Speaker 1: businesses or electric vehicle business that Tesla is built. But
Speaker 1: I think so many investors are caught up with what
Speaker 1: I call twentieth century mentality towards valuations. Okay, we're in
Speaker 1: the twenty one century now, fift p s aren't a reality.
Speaker 1: This country is the most competitive country in the world.
Speaker 1: You literally cannot invest in any other country in the
Speaker 1: world with the same level of confidence that you do
Speaker 1: in US equities. Not only that the companies are good,
Speaker 1: but also run with accounting standards and ethics and corporate
Speaker 1: standards that are higher than anywhere else in the world.
Speaker 1: So when you think about, if I'm a global investor,
Speaker 1: where do I put my money, Well, you know it's
Speaker 1: got to be the U S. And then you think
Speaker 1: about companies that are innovating and creating amazing products and
Speaker 1: services that are going to change the world, and there's
Speaker 1: only a handful of those. And then you think about
Speaker 1: one of the two biggest industries that are being disrupted
Speaker 1: right now, and you have transportation and you have energy,
Speaker 1: and Tesla is the one doing it. So to look
Speaker 1: at a traditional pe ratio would be a mistake when
Speaker 1: you're trying to value Tesla when you're talking about a
Speaker 1: company that is really cornered the market in battery production
Speaker 1: and technology as well as EV production and technology, AI robotics.
Speaker 1: I mean, it's it's endless. Tesla is trading. I think
Speaker 1: for what it's worth right now, I think that's I
Speaker 1: think it's worth about seven fifty and and I think
Speaker 1: it's upside is to about a thousand when they complete
Speaker 1: their two factories and get those up and running, which
Speaker 1: could be by the end of the year. So you know,
Speaker 1: when they get the two more factories they'll be able
Speaker 1: to double production. And so if they have the production
Speaker 1: capability to double production in the time most car companies
Speaker 1: are cutting production because they simply can't make cars. It's
Speaker 1: a huge opportunity not to mention the enormous demand for
Speaker 1: vehicles irrelevant of Tesla. Unfortunately, have to leave it there.
Speaker 1: We always love chat with you. Thank you so much
Speaker 1: for taking the time. Ross's president and CEO of Gerber
Speaker 1: Kawasaki Wealth and Investment Management. He joins us on the
Speaker 1: phone from Santa Monica, California. Thanks for listening to Bloomberg
Speaker 1: Business Week. Download the podcast on iTunes, SoundCloud, or Bloomberg
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