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Speaker 3: Tesla's Sheriff Deny to report that ZAID board members started
Speaker 3: a search forach CEO to succeed you on Musk, saying
Speaker 3: directors are quote highly confident in his abilities.
Speaker 4: All right. At the same time as Elena's promised to
Speaker 4: spend more time at his company, Musk will maintain a
Speaker 4: presence in the White House and the President's inner circle,
Speaker 4: and we'll continue to work on the initiative from his
Speaker 4: microoffice in the West Wing. Both of those stories are
Speaker 4: among the most read on the Bloomberg Let's get to
Speaker 4: It lots to cover. Bloomberg News Senior reporter Jennifer Lowe
Speaker 4: is with us. She is at the White House. Also
Speaker 4: here in studio, Bloomberg Business Week columnist Max Chafkin, co
Speaker 4: host of the Elon podcast, Elon Inc. Podcast and the
Speaker 4: author of the Contrarian Peter Thiel and Silicon Valley's Pursuit
Speaker 4: of Power.
Speaker 3: Max is in our macro office, our macro studio.
Speaker 4: Max is going to come in just a moment.
Speaker 5: Jed, we got to start with you.
Speaker 4: You talked with Elon along with some other reporters, set
Speaker 4: the scene the chat yesterday, what you all asked about
Speaker 4: and what he said.
Speaker 6: Well, I mean, this was really a remarkable opportunity. Remarkable
Speaker 6: because we haven't had many of them to hear directly
Speaker 6: from Elon Musk as he discusses his government role. Of course,
Speaker 6: he's been at you know, cabinet meetings, he's been in
Speaker 6: the Oval Office and spoken to reporters occasionally, but in
Speaker 6: this moment in the Roosevelt Room with other reporters, he
Speaker 6: was really opening up much more about what he's done
Speaker 6: over the last one hundred or so days leading the
Speaker 6: DOGE effort, the Department of Governmentment efficiency program that he's
Speaker 6: been running for President Trump. And you know, he spoke
Speaker 6: quite colorfully about, you know, the experience, not just the
Speaker 6: one hundred and sixty billion dollars in government savings that
Speaker 6: he says he's been able to root out with this
Speaker 6: program and cut. You know, he told us about flying
Speaker 6: on Air Force One, about staying in the Lincoln bedroom
Speaker 6: at at the President's request, and even tucking into, you know,
Speaker 6: ice cream from the White House fridge. So it was
Speaker 6: really remarkable and it told us a lot about I
Speaker 6: think his access to the president, about his status really
Speaker 6: in Trump's orbit even as he is making this retreat
Speaker 6: from the White House.
Speaker 3: Well Jennifer on that retreat. Investors cheered the news last
Speaker 3: week in Tesla that he would be spending more time
Speaker 3: away from Washington, d C. Now we're hearing he'll have
Speaker 3: this micro office. What can you tell us about how
Speaker 3: much time he will be in DC or how much
Speaker 3: time he'll be spending on DOGE Moving forward, right, he's.
Speaker 6: He told us that he anticipates spending about two one
Speaker 6: to two days a week on average and coming into Washington,
Speaker 6: d C. Basically once every other week. So you could
Speaker 6: see a situation where he's in town for three days
Speaker 6: working and then comes back a couple weeks later. This is,
Speaker 6: of course a marked contrast from the beginning of the term,
Speaker 6: when you know it was an all hands on deck situation,
Speaker 6: really intense, as he described it, and he would spend
Speaker 6: you know, seven days a week here sometimes working just
Speaker 6: to get into these agencies and start figuring out a
Speaker 6: plan for accessing data and examining their spending.
Speaker 5: Max, I want to bring you in.
Speaker 4: You're listening to Jen talk about this conversation kind of
Speaker 4: him talking about his time in the White House, and
Speaker 4: I think we were all glued to the cabinet meeting
Speaker 4: where he had the two hats on. Took him off
Speaker 4: and it kind of got he got kind of serious.
Speaker 7: It felt like, yeah, tonally kind of a valedictory tone.
Speaker 5: I don't know, the messaging is a little bit.
Speaker 7: Confusing because on one hand, he's saying, yeah, taking steps back.
Speaker 5: On the other hand, one to two days a week
Speaker 5: is a lot of that's a lot of days.
Speaker 7: This is a guy who is running simultaneously five companies.
Speaker 7: You know, he's got a lot of responsibilities. Even if
Speaker 7: he is, you know, as Jen says, scaling down from
Speaker 7: spending like all his time in Washington, spending a significant
Speaker 7: chunk of time in Washington.
Speaker 3: Yeah, So on that, Jennifer, the timing that he's doing here. Also,
Speaker 3: the figures of one hundred and sixty billion dollars, I
Speaker 3: think getting a lot of attention, especially earlier this year,
Speaker 3: when or maybe even a few months ago, and we
Speaker 3: heard that two trillion dollars was his goal of cutting
Speaker 3: from the government. Have we learned if that goal was
Speaker 3: over a ten year period, over a five year period,
Speaker 3: or how the one hundred and sixty billion dollars sort
Speaker 3: of fits into that goal, or if that goal has changed.
Speaker 6: What we do know is that the ambition is clearly
Speaker 6: being ratcheted downward. And while he is not willing to
Speaker 6: forego reaching, you know, a one trillion dollar target, he
Speaker 6: wouldn't rule that out completely. He did say that doing
Speaker 6: so on any base would require a lot of you know,
Speaker 6: willpower from elected officials, and he's just not sure that
Speaker 6: the willpower is there. He wouldn't roll it out, but
Speaker 6: it did seem very much like a concession that this
Speaker 6: is he's gotten a lot of the easier, lower hanging fruit,
Speaker 6: and that this is hard to do on an enduring basis.
Speaker 6: And by the way, I'll just say, on his time here,
Speaker 6: he is limited as a special government employee to one
Speaker 6: hundred and thirty days of service per calendar year.
Speaker 7: Yeah, I mean, and it was two trillion in fact,
Speaker 7: was his original claim and that that was an annual number,
Speaker 7: that's a budget deficit. When he was at Madison Square
Speaker 7: Garden before the election, you know, Howard Lutnik asked him
Speaker 7: how much he was going to cut the deficit. He
Speaker 7: said easily two trillion or something along those lines. So
Speaker 7: it's a huge difference and really an unusual you know,
Speaker 7: just for Elon Musk. This is somebody who is kind
Speaker 7: of used to projecting dominance, who just tends to go
Speaker 7: from victory to victory to victory.
Speaker 5: This is a come down, I mean, and and he is.
Speaker 7: He's doing his best, and I think that's part of
Speaker 7: why you're seeing these media availabil as effort to, you know,
Speaker 7: to actually have a voice in the story, because it
Speaker 7: is it is. It is a it's a failure at
Speaker 7: least in the terms that he set for what he
Speaker 7: was trying to do.
Speaker 4: Ten before we let you go, I mean to re
Speaker 4: assume that Elon will still have a voice or have
Speaker 4: the president's ear ongoing, even though he maybe isn't physically
Speaker 4: at the White House. There are limitations, right, how many
Speaker 4: days he can serve the government in this capacity that
Speaker 4: he will still pick up the phone, The President will
Speaker 4: still pick up the phone. There will be that constant
Speaker 4: communication or has something changed in that relationship.
Speaker 6: You know, there's all the indications are that he will
Speaker 6: continue to have this status around the president. I mean,
Speaker 6: he's clearly had altercations and disagreements with members of the administration,
Speaker 6: and it is perhaps one of the only folks who
Speaker 6: can do that right now. He's, as we noted at
Speaker 6: the top of this conversation, you know, he's got a
Speaker 6: micro office in the West wing of the White House,
Speaker 6: and he's not giving that up. You know, office space
Speaker 6: in this building is pretty difficult to come by, and
Speaker 6: that alone is an indication of the fact that he
Speaker 6: has he is stature with a president and that seems
Speaker 6: to be enjoyed.
Speaker 4: Did we figure out what a micro office is?
Speaker 3: It's like an office but smaller.
Speaker 4: What is that? I don't know.
Speaker 5: That's just what I'm going Do you have to share desks?
Speaker 4: You know, that's kind of a thing nowadays. I know,
Speaker 4: all right, Jen, incredible reporting, So appreciate Jen Deloewey, a
Speaker 4: senior reporter at Bloomberg News there at the White House.
Speaker 4: We're going to stay with Max though.
Speaker 3: Max I wanted to follow up on one thing that
Speaker 3: you said about the status as a special government employee,
Speaker 3: because you talk about this a lot on the Elon Inc. Podcast.
Speaker 3: How is that defined? If he's planning on spending one
Speaker 3: or two days a week still, I mean, yeah, does
Speaker 3: that violate that status? How does that work?
Speaker 7: It's my guess is the accounting here can be is
Speaker 7: probably a little bit fuzzy. It's one hundred and thirty
Speaker 7: work days. Like I don't know if Elon Musk was.
Speaker 7: He has been staying here, as Jen was saying, weeks
Speaker 7: at a time, essentially in Donald Trump's orbit. Now he's
Speaker 7: also been, of course, attending space X meetings, and he's.
Speaker 3: Played video games from his Westling office. If you're playing
Speaker 3: video games in the office, does it count as work?
Speaker 2: I don't know.
Speaker 3: I don't know if does account as a work day.
Speaker 3: I don't know.
Speaker 4: My suspicion work when you play video games at the air.
Speaker 3: I never play video games at the office.
Speaker 5: My suspicion.
Speaker 7: I mean taking it down from semi full time or
Speaker 7: whatever he was to one to two days of days
Speaker 7: a week.
Speaker 5: What I think that does is two things. One is it.
Speaker 7: Allows him to tell Tesla's shareholders, hey, I'm not distracted
Speaker 7: The second thing is it probably gives them a little
Speaker 7: bit of flexibility as far as like not being not going.
Speaker 5: Over that one hundred and thirty days.
Speaker 7: You know, I have to think that he's going to
Speaker 7: have as much time in the White House with Donald
Speaker 7: Trump as he wants, and the administration will will figure
Speaker 7: out a way to account for his time.
Speaker 5: So that's so it's not bringing.
Speaker 4: Along because the President likes this relationship pretty cool and
Speaker 4: also because of Elon steep Pockets.
Speaker 7: Yeah, I mean he is a really important I mean
Speaker 7: there there's a lot of ink has been spilled about
Speaker 7: the sort of popularity of DOGE and the lack there
Speaker 7: are of the fact that making these has not, in
Speaker 7: addition to falling well short of the claims of deficit reduction,
Speaker 7: this has been very unpopular.
Speaker 5: On the other hand, Trump really needs Elon Musk.
Speaker 7: He is the most important donor on the Republican side
Speaker 7: right now. He's going to be key if the Republicans
Speaker 7: want to do well on the midterms. And you know,
Speaker 7: as Trump looks forward to his legacy, you know twenty
Speaker 7: twenty eight, who the candidate is going to be. That
Speaker 7: person is going to need Elon Musk in their corner.
Speaker 4: Can we ask about you're going there?
Speaker 3: Yeah, go there?
Speaker 4: Does Elon have to be worried about the Tesla board
Speaker 4: replacing him? I mean, the board chair has come out
Speaker 4: and said nope, but we had another bad data point
Speaker 4: for Tesla out of France. So I'm just curious, does
Speaker 4: he really have to be worried?
Speaker 5: So this report you're referring to the Wall Street Journal
Speaker 5: report that the board had contacted executive search forms. Look,
Speaker 5: we're talking about a normal company.
Speaker 7: This will be nothing, right, the fact that the stock's
Speaker 7: been all over the place, He's clearly distracted. Of course
Speaker 7: they'd be talking to other companies. And what makes this
Speaker 7: crazy and what makes the boards denial not that surprising
Speaker 7: is the board has been so behind Elon Musk for years.
Speaker 7: And you know, this is the same board who has
Speaker 7: been fighting in court to pay him like the largest
Speaker 7: bonus you know, in history, despite the fact that Tesla's
Speaker 7: stock price has.
Speaker 3: Been very iffy. So so the board, you know, is.
Speaker 5: Very much still in Elon Musk's corner.
Speaker 7: If you look at the makeup of the board, you're
Speaker 7: looking at his brother of people he has close relationships to.
Speaker 7: So I think you know, a couple of things are
Speaker 7: possible here, assuming that the journal sources are legit, which
Speaker 7: I do, is that you know, there may be some
Speaker 7: opponent on the board who's been talking to search firms,
Speaker 7: or perhaps this is somebody on the board trying to
Speaker 7: send a message to Elon Musk, trying to get through
Speaker 7: to him saying you know, hey, this is real, we
Speaker 7: need you to be involved. But in any case, I
Speaker 7: wouldn't expect him to be leaving.
Speaker 5: A CEO anytime soon.
Speaker 7: If he were to leave, the stock price would would
Speaker 7: be in trouble, be my prediction.
Speaker 3: Some other members of the board. You mentioned Elon's brother
Speaker 3: Kimball Musk on the board. He's been on the board
Speaker 3: for twenty one years. You've got James Murdoch who's been
Speaker 3: on the board for close to eight years, Jeff Straubel
Speaker 3: who's been on the board for two years, and then
Speaker 3: Joe Gebbia, among others including Kathleen Wilson Thompson, as well
Speaker 3: Robin Dnelm, the chair of the board. We should note
Speaker 3: Max before we let you go, why do you think
Speaker 3: is it still is? Are we still at a point
Speaker 3: where Elon is so closely tied to Tesla and Tesla's
Speaker 3: future because couldn't some investors or perhaps even institutional investors
Speaker 3: see this as like, wait a second, this could actually
Speaker 3: be a positive sign for Tesla because it would help
Speaker 3: get it beyond the you know, being inextrictly bound to politics.
Speaker 7: Yeah, if you talk to investors, you do hear that view,
Speaker 7: but it's very much a minority view. And the reason
Speaker 7: it's a minority view I'm saying among Tesla investors, not
Speaker 7: necessarily among outside observers, is because the valuation of Tesla
Speaker 7: right now is very much not about its automotive ambition.
Speaker 7: So if you replaced Elon Musk with a normal CEO,
Speaker 7: what you have as a car company. But many of
Speaker 7: Tesla's investors don't want to have a car company. They
Speaker 7: want to have an AI company. And it's not clear
Speaker 7: who runs that company, who can sell the muscles.
Speaker 3: Musk has got an AI company, a second one, he does.
Speaker 7: He has got Xai absolutely, But but you know, Musk
Speaker 7: has told this story about driverless taxis and the optimist
Speaker 7: robot that's a humanoid robot. And when you look at
Speaker 7: the bullish valuations, if you listen to the bulls, they
Speaker 7: are not counting on the model three or the model.
Speaker 7: Why these the Tesla's kind of normal cars, which are
Speaker 7: very successful in their own terms. They're expecting this entirely
Speaker 7: new AI driven revenue stream, which really mostly just exists
Speaker 7: in Elon Musk's head.
Speaker 5: And if you take Elon Musk out of the equation, how.
Speaker 3: Do you do that model?
Speaker 7: It becomes harder and and people, you know, you're laughing,
Speaker 7: but you know, Elon Musk has achieved impressive things. And
Speaker 7: from the point of the investors, if anyone can do it,
Speaker 7: he can.
Speaker 4: And laughing, but I feel like they're investing in Elon
Speaker 4: right and all all the craziness and all the innovation
Speaker 4: that comes with him.
Speaker 5: Yeah, pretty good, That's how it goes.
Speaker 4: Thank you, Max Chaffkin, Thank you so much, Bloomberg Business.
Speaker 4: We recommnist Max Chafkin, co host of the Elining podcast and,
Speaker 4: as we remind you, author of the contrarian Peter Tiel
Speaker 4: and Silicon Valley's Pursuit of Power.
Speaker 2: You're listening to the Bloomberg Business Weekdaily podcast. Catch us
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Speaker 3: On the sales side, I want to bring on Punham Boyle,
Speaker 3: senior analyst for e commerce at Leisure Off Price Retail
Speaker 3: for Bloomberg Intelligence. She joins U from New York City
Speaker 3: this afternoon. Let's talk about this miss when it comes
Speaker 3: to second quarter operating income. The outlook there is that
Speaker 3: a result of tariffs? In your view, it.
Speaker 8: Has to be, because when I think about the operating
Speaker 8: margin that they just posted with AWS, you know, incredible
Speaker 8: near forty percent the downside that we're seeing going into
Speaker 8: two Q, I can't think of anything else that could
Speaker 8: be driving that and higher costs that they'll have to
Speaker 8: orb due to the tariffs.
Speaker 4: Are you surprised that, like we kind of you know,
Speaker 4: went through that press release, there's really nothing on tariffs.
Speaker 4: There's like that disclosure that kind of dumps everything at
Speaker 4: the very bottom of the page. Not surprising to see
Speaker 4: that they didn't really address it in the release, And
Speaker 4: I guess it's all going to come out on the call.
Speaker 8: Yeah, I think there's going to be a lot of
Speaker 8: questions about tariffs. Keep in mind that, you know, Amazon
Speaker 8: is directly exposed on the one P side, so roughly
Speaker 8: forty percent of its business is where they do have
Speaker 8: to deal with tariffs. The other sixty percent, that's three
Speaker 8: P the sellers have to deal with them, but Amazon
Speaker 8: helps you set the price on its platform to make
Speaker 8: it competitive. So there's just a lot of back and
Speaker 8: forth that's going on, and with some suppliers they are
Speaker 8: working one on one to see where they can help
Speaker 8: offset the price increases. But the biggest delta between one
Speaker 8: Q and two Q is tariffs. So the guidance that
Speaker 8: we see here has to be a result of that
Speaker 8: wide net that they've casted.
Speaker 3: You mentioned the ps, but translate for.
Speaker 8: US sure, third party and first party first party when
Speaker 8: Amazon owns the goods, so basically they take on the
Speaker 8: cost and they directly source it from the supplier. Third
Speaker 8: party is if you and I go on to Amazon
Speaker 8: and we start selling stuff.
Speaker 3: What's the breakdown in terms of actual goods that are
Speaker 3: sold third party versus first party?
Speaker 8: Sure, third party, we estimate is about sixty five percent
Speaker 8: and third and first party is about thirty five to
Speaker 8: forty percent?
Speaker 3: Okay, sixty four And is there more like third party
Speaker 3: is more from China or do we not know than
Speaker 3: first party?
Speaker 8: Well we Amazon doesn't tell you how much they get
Speaker 8: from China. But just by looking at what's on their
Speaker 8: platforms and third party data, irrespective third party or first party,
Speaker 8: it's estimated that over seventy percent of what's sold on
Speaker 8: the Amazon dot Com platform is from China. So it's
Speaker 8: a large, large, large piece of their market place.
Speaker 3: Just to remind everybody, I mean, you you you study
Speaker 3: e commerce at leisha off price retail, this is you know,
Speaker 3: this is your world. This stuff is made overseas, like
Speaker 3: very little of it is made here in the US,
Speaker 3: very little.
Speaker 8: I mean food is the only thing we may procure
Speaker 8: locally that Amazon sells. Really everything else, the bulk of
Speaker 8: what you buy in retail in the US is made
Speaker 8: outside of the US. It doesn't matter who you are.
Speaker 4: What I don't know, Okay, I'll let him have a moment.
Speaker 5: You know what's.
Speaker 4: Interesting put in We kind of just laugh that Normally
Speaker 4: when we're talking Amazon, we're all over Amazon Web Services
Speaker 4: and it's like, oh yeah, that retail business. So what
Speaker 4: an interesting kind of report to go through and what
Speaker 4: we're focusing on. I do want to point out though,
Speaker 4: that AWS reported first quarter sales gain seventeen percent to
Speaker 4: twenty nine point three billion, in line with analyst testaments.
Speaker 4: It was the unit's slowest growth in a year. So
Speaker 4: it does feel like I don't know, like, what do
Speaker 4: we get out of that.
Speaker 8: I think it's okay, I mean, okay, I'm going to
Speaker 8: see businesses pull forward spend, pulled back on spend. There's
Speaker 8: still a lot of momentum here on the AWS side.
Speaker 8: And really, you know, while the sales were just in line,
Speaker 8: the margin was incredible thirty nine percent operating margins thirty
Speaker 8: nine point five percent roughly, that's huge. Consensus is looking
Speaker 8: for about thirty five percent. So we do think, you know,
Speaker 8: this business will abb and flow and you'll have high margins,
Speaker 8: you'll have low margins depending on where they invest. But
Speaker 8: the long term potential of AWS is still pretty sizable
Speaker 8: and there's a long runway here.
Speaker 3: Okay. So if we think about this in the context
Speaker 3: of what we heard from what we've heard from other
Speaker 3: companies thus far, what we heard from Microsoft yesterday, and
Speaker 3: as a reminder, I mean, you cover the e commerce
Speaker 3: at leisure, the off price retail. How do you think
Speaker 3: about this in terms of the retail world, like the
Speaker 3: Walmart's of the world, the targets of the world. How
Speaker 3: does this report sort of inform the way we should
Speaker 3: be thinking about and investor should be thinking about those
Speaker 3: other companies.
Speaker 8: I think if Amazon's facing these tariff headwinds, so is
Speaker 8: everyone else, including Walmart, including smaller companies, medium sized companies,
Speaker 8: And really there is no escape from this unless we
Speaker 8: see things come from here. The one hundred and forty
Speaker 8: five percent here iff that you see on China is sizable.
Speaker 8: If that stays that way, the consumer is going to
Speaker 8: be paying higher prices. We will see some out of
Speaker 8: stocks on shelves in the coming months, as most companies
Speaker 8: have halted shipments from China, and it's not going to
Speaker 8: be an overnight switch to take everything that you make
Speaker 8: in China to somewhere.
Speaker 3: Else, or even impossible for something. Some analysts have said, well,
Speaker 3: you said empty shelves, where are we going to see them?
Speaker 3: What do you think we'll see them?
Speaker 4: Saw empty shelves in like a drugstore, But I don't
Speaker 4: know that's because everybody.
Speaker 3: Stole everything there.
Speaker 7: Terrible.
Speaker 3: I don't you know how this works.
Speaker 5: I know it's always a little war perspective.
Speaker 4: Go ahead, BuNos, Sorry, well, you.
Speaker 8: Won't see empty shelves on Amazon but you will see
Speaker 8: out of stocks. In fact, you know, I was just
Speaker 8: browsing the web randomly and I started to see some
Speaker 8: things that just said out of stock, like we'll let
Speaker 8: you know when it comes back. So I think you'll
Speaker 8: start to see inventory. Actually that that comes out of
Speaker 8: China be put on hold and we don't know when
Speaker 8: it'll come back. Because unless you raise the prices or
Speaker 8: double them, you're not making the same margin.
Speaker 3: On what's the consumer's willingness to pay for this stuff. Because,
Speaker 3: as I was mentioning to Caroline, if we see these
Speaker 3: price increases across the board, if we see them a Target,
Speaker 3: if we see them at Walmart, It's not like this
Speaker 3: is an Amazon specific story. We're going to see this everywhere.
Speaker 3: At what point does the consumer throw in the towel
Speaker 3: and say, I'm not going to do this. I'm not
Speaker 3: going to pay.
Speaker 8: I think the consumer will say I'm not going to
Speaker 8: pay when prices go up thirty forty percent, right, it's
Speaker 8: going to get more expensive. And if they say they
Speaker 8: don't pay, it means before they bought ten things, now
Speaker 8: they'll buy three things. Where are they buying those three things?
Speaker 8: Are they going to trade down from a national brand
Speaker 8: to a private brand. Are they going to buy more
Speaker 8: staples that they can you know, like staple colors that
Speaker 8: they can reuse, recycle reware, and wear less fashion that
Speaker 8: goes out of style quickly. There's going to be trade
Speaker 8: offs if prices rise materially. That said, we you think that,
Speaker 8: you know, people will just switch brands, They'll switch options
Speaker 8: where they can get things cheaper. We're going into the
Speaker 8: back half in just a few months, and that's the
Speaker 8: peak selling season of retail. When you think about toys,
Speaker 8: specifically right for the holidays, when you think of back
Speaker 8: to school. Yeah, I mean, what do you get your
Speaker 8: kids if you're not going to get them the barbie
Speaker 8: and you're not going to pay you know.
Speaker 4: You can only get them two barbies?
Speaker 3: Barbies only two dollars.
Speaker 4: Sorry, uh no, I'm just repeating you know what we've heard. Hey,
Speaker 4: one last question I will say though, with the Amazon cart,
Speaker 4: like when you put them in and like you automatically
Speaker 4: see the value, like if things start to get more expensive,
Speaker 4: like you might pull back thirty seconds. Top question you
Speaker 4: think must be asked on the Amazon call?
Speaker 8: How are we weathering this tariff storm that we're going into,
Speaker 8: especially you know, with three piece sellers, how are they
Speaker 8: going to control that. Amazon is still an attractive place
Speaker 8: where value is seen because they don't have a control
Speaker 8: on prices for everything.
Speaker 4: All right, gonna leave it there, Hey put it. Thank
Speaker 4: you so much, super super good conversation. Puna mcgoyle, Senior
Speaker 4: analyst for e Commerce, ath Leisure, off Price Retail for
Speaker 4: Bloomberg Intelligence.
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Speaker 4: You know ed Ledo still with us too, of course,
Speaker 4: co host of Bloomberg Technology, and we want to bring
Speaker 4: into the fold. Mark German back with us, Managing editor
Speaker 4: for Global Consumer Tech out there in our San Francisco bureau.
Speaker 4: All right, so Apple down about two point seven percent.
Speaker 5: Mark.
Speaker 4: We know you really are interested mostly in the call,
Speaker 4: but the numbers are out. What if anything is of
Speaker 4: interest here or you think is notable.
Speaker 9: I mean, overall revenue is up five percent every year,
Speaker 9: so obviously that's a good thing. You saw iPhone sales
Speaker 9: be slightly expectations from Wall Street, so that's a good thing.
Speaker 9: Show some solid momentum for the iPhone sixteen E. Notice
Speaker 9: that Tim Cook mentioned the sixteen e in particular versus
Speaker 9: the pro models, which generate the most amount of revenue
Speaker 9: for Apple. Obviously, Mac did a little bit better than expected,
Speaker 9: iPad better than expected, but we saw some softness on
Speaker 9: China services as well as wearables, Home and Accessories, Wearable's
Speaker 9: Home and Accessories. The softness there continues. It's been this
Speaker 9: way for several quarters. That's sort of surprising given the
Speaker 9: momentum that we've seen in the past on the Apple
Speaker 9: Watch and the AirPods and some of those peripheral products.
Speaker 9: Services still pretty considerable double digit growth, but not at
Speaker 9: the same level that Wall Street was anticipating. Services in
Speaker 9: particular is quite interesting because that's going to probably be
Speaker 9: a real headwind for Apple in the coming years now
Speaker 9: that they're needing to adjust some of their app store
Speaker 9: policies in relation to commissions. And then, of course we
Speaker 9: have the Google Search deal overhanging all of this stuff.
Speaker 9: That's a double digit billion dollar annual revenue stree for Apple.
Speaker 9: That may also go away depending on where the US
Speaker 9: government goes with this trial against Google.
Speaker 3: A lack of a lack of commentary though, and maybe
Speaker 3: we'll get it on the call. I know you're looking
Speaker 3: for it about supply chains and about tariffs. Do you
Speaker 3: think that's why investors are sending shares down ahead of
Speaker 3: this call?
Speaker 8: No?
Speaker 9: I think it's because of the continued softness in China
Speaker 9: in particular. Obviously, China's Apple's third biggest market. China really
Speaker 9: swings the pendulum here and when it comes to Apple
Speaker 9: shares going up or down on earnings calls, And in
Speaker 9: this case, we're at an annual decline, certainly an able
Speaker 9: decline compared to where Apple was two years ago in
Speaker 9: China this time around, and then missing Wall Street expectations
Speaker 9: by about half a billion dollars. So definitely not a
Speaker 9: good sign for Apple and China. And I think investors,
Speaker 9: or at least those analysts on the call are gonna
Speaker 9: have a lot of questions about that. But I hope
Speaker 9: they do dig into tariffs as much as possible.
Speaker 10: Hey, Mark, I just want to go to the iPhone beat,
Speaker 10: because it all comes back to the iPhone sometimes. Right,
Speaker 10: forty six point eighty four billion. Estimate was forty fur
Speaker 10: five point ninety four. The third party data showed a
Speaker 10: lot of consumer electronics flying around the planet in the
Speaker 10: first three months of this year. Do you see any
Speaker 10: sort of evidence just from the pure number that this
Speaker 10: was people buying handsets front running tariffs in anticipation that
Speaker 10: maybe prices might go up in the future.
Speaker 9: I don't think the front running of purchases to avoid
Speaker 9: price hikes in the future really happened until you know,
Speaker 9: mid late April, when that's already within Apple's third quarter.
Speaker 9: So I don't think that any of the iPhone sales
Speaker 9: numbers that we're seeing here really were influenced by people
Speaker 9: trying to get ahead of tariff price hikes. I mean,
Speaker 9: Trump made his announcement in early April, and this was
Speaker 9: not really in the public consciousness until then, which again
Speaker 9: is the start of the third quarter for Apple. So
Speaker 9: I think the impact there will be in the current quarter,
Speaker 9: and I'm looking forward to hearing any guidance that Apple
Speaker 9: gives on the call which may give us a taste
Speaker 9: of how the iPhone's going to do in this current period.
Speaker 4: Well, go ahead, Carol, what do you think they're going
Speaker 4: to say, in terms of price increases, it's something you
Speaker 4: gave us a heads up on earlier, you know, in
Speaker 4: terms of margins impact, and then price increases, you know,
Speaker 4: in this tariff filled environment. So do you think we'll
Speaker 4: get any kind of clarity or specifics on that.
Speaker 9: So, if I was a betting man, at least one
Speaker 9: analyst is going to ask about the potential of price increases.
Speaker 9: And if I remained a betting man, I would say,
Speaker 9: Tim Cook would say, we'll see nothing to announce today,
Speaker 9: and then maybe if we're lucky. Talk about how they
Speaker 9: think about these types of things.
Speaker 3: Well, how does Apple do price increases?
Speaker 9: Well, they really don't. I mean, the iPhone price has
Speaker 9: been stagnant for the most part. There are some exemptions
Speaker 9: over the past you know, seven, eight, nine years, so
Speaker 9: they really don't do price increases. And so when they
Speaker 9: do make the price increase, they're going to do it
Speaker 9: from a position of strength. They're going to focus on
Speaker 9: installment plans, They're going to focus on carrier deals, and
Speaker 9: they're going to focus about on the technologies that they've
Speaker 9: implemented over last decade to make the iPhone more valuable.
Speaker 9: They're going to talk about how useful the phone is
Speaker 9: how it's equivalent to X number of cups of coffee
Speaker 9: is a year, et cetera. And they're definitely not going
Speaker 9: to mention tariffs as a reason because they saw what
Speaker 9: that did to Amazon the other day.
Speaker 4: Well said, Well said, looking forward to your reporting after
Speaker 4: the call as well. Mark Mark German, Managing editor for
Speaker 4: Global Consumer Tech Bloomberg News out there in our San
Speaker 4: Francisco bureau. So ed just got about thirty seconds here.
Speaker 4: I mean, what are you thinking about? Is it just
Speaker 4: again Terriff's for Apple or Amazon? Like I don't know.
Speaker 10: Yeah, point Like, if it wasn't that front running on
Speaker 10: the iPhone, then what was the beat people still in
Speaker 10: love with the iPhone? Just I think that's a really
Speaker 10: basic question. But again, all we've got to go off
Speaker 10: on the right now is that we noticed that Apple
Speaker 10: added the word trade right, one single word to the
Speaker 10: boiler plate in the forward guidance or financial disclosures disclaimer and.
Speaker 5: Both of them.
Speaker 3: Yeah, surprised Apple didn't have that in there already, given
Speaker 3: what we knew about this administration, and they that those risks.
Speaker 4: Are listened supply chain the idea, you know what.
Speaker 3: Happened in twenty seventeen. Two. Yeah, but hey.
Speaker 4: Ed Lolo, thank you so much for a moment.
Speaker 2: You're listening to the Bloomberg Business Weekdaily podcast. Catch us
Speaker 2: live weekday afternoons from two to five pm Eastern. Listen
Speaker 2: on Apple CarPlay and Android Auto with the Bloomberg Business app,
Speaker 2: or watch us live on YouTube.
Speaker 3: Also out with an update, ELI Lilly shares falling as
Speaker 3: much as twelve percent earlier in the session, the biggest
Speaker 3: intry day drop going back to October. Shares now down
Speaker 3: ten and a half percent. This after CBS announced a
Speaker 3: plan to drop its blockbuster weight loss of drug zet
Speaker 3: Bound from its preferred list making rival wey govi more
Speaker 3: widely available. Madison Mueller is Bloomberg News Health reporter. She
Speaker 3: joins us here in the Bloomberg Interactive Brokers studio. So
Speaker 3: Lily maintained sales guidance. Zet Bound performed in line with
Speaker 3: Wall Street's expectations, but investors who've been hoping for more
Speaker 3: explosive growth were underwhelmed. Are we seeing prices here?
Speaker 1: Yeah, that is what is definitely starting to happen here.
Speaker 1: I mean, coming on the heels of the news that
Speaker 1: we discussed earlier this week, which was that Nova Nordisk
Speaker 1: was partnering or working with some telehealth companies to distribute
Speaker 1: via or to distribute pens of its blockbuster drug would
Speaker 1: go V at a lower cost. And now we're seeing
Speaker 1: Novo partner with CVS retail pharmacies and CVS is Drug
Speaker 1: Benefits Manager Unit to provide more cost savings for patients
Speaker 1: and for health plans that cover weight loss drugs. So
Speaker 1: it's definitely hitting up.
Speaker 4: Is it just negotiating or is it I mean, we've
Speaker 4: talked with you too that there's similar drugs, but they're
Speaker 4: not all exactly the same. So I'm just a little
Speaker 4: curious about fat you.
Speaker 1: Said, yeah, I mean that is part of the interesting thing.
Speaker 1: I mean, Lily has said and they were saying today
Speaker 1: that the price of the medication, they purposefully priced it lower,
Speaker 1: I mean for competitive reasons. It came onto the market
Speaker 1: after Novo Nordisks drug. Lily's drugs Utbound, is a little
Speaker 1: bit more effective, but both drugs work really well for
Speaker 1: weight loss. Lily's drug costs around one thousand dollars a month,
Speaker 1: while Novo's is about thirteen hundred dollars a month, but
Speaker 1: those the higher list prices mean that drug makers, when
Speaker 1: they're negotiating with these PBMs, can provide greater discounts, bigger rebates,
Speaker 1: So in some ways it actually turns out to be
Speaker 1: a benefit when they're at the negotiating table. But those
Speaker 1: that's one of the things, and we were talking about
Speaker 1: this earlier.
Speaker 2: There's not a lot of.
Speaker 1: Clarity about how these negotiations work, what happens behind the scenes,
Speaker 1: and that's not something that we're probably going to get
Speaker 1: anytime soon.
Speaker 3: So was today's stock move all about this CBS news?
Speaker 1: Yeah, I mean, in part, I think it sort of
Speaker 1: compounded the underwhelming results that you mentioned earlier. I mean,
Speaker 1: it was a good quarter for Lily, but their expectations
Speaker 1: for this company are so high now that they just
Speaker 1: can't really afford to have a a you know, inline quarter.
Speaker 1: Investors were looking for more growth and looking for zep
Speaker 1: bound sales that sort of smash past X estimates like
Speaker 1: they did last year, and that's just not what happened.
Speaker 1: So it was just a little bit disappointing, I think.
Speaker 1: And then and then seeing the CVS news, it was
Speaker 1: interesting because CVS and Lily both reported earnings today, so
Speaker 1: we've sort of got to see this happen in real time.
Speaker 4: All right, So I mean I don't know, can can
Speaker 4: this change? I mean, how much of it is about
Speaker 4: the GLP one still for Lily, like we always talk
Speaker 4: about the pipeline and.
Speaker 3: Other things, it's like more than a seven hundred million
Speaker 3: dollar company at this point.
Speaker 1: Yes, so she helps us like put this in perspective,
Speaker 1: and that is really that valuation is really about weight
Speaker 1: loss struggs. But the thing is Lily's, like you just mentioned,
Speaker 1: their pipeline. People are so excited about Lily's pipeline because
Speaker 1: not only do they have zep bound, which is, like
Speaker 1: we said earlier, a little bit more effective, but they
Speaker 1: also have a weight loss pill that's coming pretty soon,
Speaker 1: as early as twenty twenty six, the CEO has said,
Speaker 1: and that is thought to be the next big thing
Speaker 1: in this market. They are far ahead of the competition
Speaker 1: when it comes to that, and they're going to continue
Speaker 1: to sort of dominate this space.
Speaker 4: So can the one follow in terms of the PBMs?
Speaker 4: And you know, negotiating, so you know, if they come
Speaker 4: with a pill, is that a whole separate negotiation because
Speaker 4: it's a different form of delivery versus an injection.
Speaker 1: Yeah, I mean, that is the question. I mean, the
Speaker 1: thought is that the pills will be priced lower to
Speaker 1: begin with, because they're easier to manufacture. Pills are typically
Speaker 1: a little bit cheaper. But Novo has a pill on
Speaker 1: the market right now called Rybelsis that doesn't work as
Speaker 1: well for weight loss, but it's around the same price
Speaker 1: as at Zempics. So it sort of is to be
Speaker 1: determined what will happen with the pricing war, but the
Speaker 1: expectation is that it will be a little bit cheaper
Speaker 1: on pricing.
Speaker 3: You and the team out with a story about a
Speaker 3: price war here, reminding us that Novo reached a deal
Speaker 3: with HIMS and Hers this week along with two other
Speaker 3: telehealth medicine providers, for a month's supply starting at four
Speaker 3: hundred ninety nine dollars. This is a wee gov before
Speaker 3: subscription fees. Leli Lily announcing expanded partnership with weight Watchers
Speaker 3: on April twenty ninth. How low is this price going
Speaker 3: to go?
Speaker 1: That's the question, I mean, and I think that that's
Speaker 1: what investors were worried about.
Speaker 3: Price price worth great for consumers exactly, not good for investors.
Speaker 1: And we've seen these companies get and we say in
Speaker 1: the story publicly lambasted for the prices of their drugs.
Speaker 1: I mean, Bernie Sanders called the CEO of Novo Nordisk
Speaker 1: into a hearing last year and then really railed him
Speaker 1: on the price of these of these medications. And they
Speaker 1: are bringing the prices down, and they are expanding accessibility options,
Speaker 1: affordability options for patients. But I think investors were concerned
Speaker 1: what this means for Lily. Are they going to lose
Speaker 1: out on share because of this?
Speaker 4: Where is it manufactured? Is it he all here?
Speaker 1: So far they do. Their supply chains are sort of
Speaker 1: all over the place. No holl makes some of the
Speaker 1: drug here. They do, they make some in Denmark. Same
Speaker 1: with Lily. The first step happens in Ireland, a lot
Speaker 1: more happens here. So they are also potentially exposed to Tariff's.
Speaker 4: Madison Muller the best health reporter here at Bloomberg News.
Speaker 4: Check her out on the Bloomberg.
Speaker 1: MC.
Speaker 7: No.
Speaker 4: I'll bet you let me drive.
Speaker 5: Oh no, no, no no.
Speaker 7: This is not a toy drug.
Speaker 5: Honey, please gravels wait, I want to try.
Speaker 1: It's a good question, good time.
Speaker 3: This is the drive to the clothes.
Speaker 5: Plums for music.
Speaker 2: Well, Briar Jona don on Bloomberg Radio.
Speaker 4: All right, TikTok, everybody, about eighteen minutes to go until
Speaker 4: we wrap up the trade on this first trading day
Speaker 4: of May May one, twenty twenty five. Charlie just breaking
Speaker 4: down the numbers along with Jordan, and you can see that, Yeah,
Speaker 4: up about one percent on the S and P five hundred,
Speaker 4: all our best levels of the session. And you've got
Speaker 4: really those big tech names continuing to push the nowstak
Speaker 4: one hundred higher, up about one point six percent. In particular,
Speaker 4: Meta and Microsoft. We talked about it earlier after the day,
Speaker 4: after the clothes we get the a's of the mag.
Speaker 3: Seven Airbnb, no Am Jen no.
Speaker 4: Oh no, no funny, how that works?
Speaker 3: Apple and Amazon?
Speaker 4: That's what you're talking about, Okay, exactly.
Speaker 3: Hey, let's see what Max Wasserman has to say about this.
Speaker 3: He's founder and senior portfolio manager at Mirra Mark Capital. Max.
Speaker 3: I don't want to talk about these individual names with you.
Speaker 3: We're going to have plenty on that in just a
Speaker 3: few minutes. I want to hear your thoughts on the
Speaker 3: macro environment right now, given that we've seen such a
Speaker 3: rally over the last few days. Hard to believe that
Speaker 3: April ended the way it did given the selling that
Speaker 3: we saw in the first part of the month. Yeah,
Speaker 3: it's great to be here.
Speaker 11: It's fascinating to see all the turmoil that's taking place
Speaker 11: in the marketplace based on commentary out of the White House.
Speaker 11: But if you look behind that and you look at
Speaker 11: what's happening in the economy, we are seeing signs of
Speaker 11: economy slowing down and you're still seeing embedded inflation. So
Speaker 11: the question becomes, will the Fed take that embedded inflation
Speaker 11: and hold off We'll look at the tariffs as a
Speaker 11: transitory inflation that can be that needs to be dealt with,
Speaker 11: or can just leave it alone. But we see the
Speaker 11: economy slowing down, we see the consumer eventually being hurt
Speaker 11: by that, and if the tariffs again, it's hard to
Speaker 11: handicap that because he keeps making exceptions all the time, right,
Speaker 11: I mean, you just heard the latest thing about Iran
Speaker 11: with oil, So it becomes very challenge. But we think
Speaker 11: this market is slowing down, and we think the consumer
Speaker 11: is going to be hurt by that, and we think
Speaker 11: the market needs to reflect that, and we think it
Speaker 11: is for the most part. But there's areas of pockets
Speaker 11: where technology they're still gravitating to that right now, Hey,
Speaker 11: do you feel.
Speaker 4: Like with confiction max that you can say, Okay, this
Speaker 4: is our market for the rest of twenty twenty five
Speaker 4: or it could change dramatically for the better for the worse.
Speaker 3: Yeah.
Speaker 11: I don't think you can do conviction for an afternoon
Speaker 11: with this White House. I mean, every single time you
Speaker 11: hear about a tariff, you hear an exception, and you're
Speaker 11: going to hear that tonight. It's going to be interesting
Speaker 11: to hear from the two companies this evening. But now
Speaker 11: I mean mentioning names. One of the companies get seventy
Speaker 11: percent of their products they sell to Americas from China,
Speaker 11: so that has to be inflationary unless they get an exemption.
Speaker 11: But the question becomes planning or investing. You have to
Speaker 11: really take a long term look and not trade this
Speaker 11: short term because the information's changing by the hour. But
Speaker 11: we do see good companies out there that have been
Speaker 11: hit hard that you know, over six, twelve, eighteen months
Speaker 11: should be in good investments paying a good dividend.
Speaker 5: So we like that.
Speaker 11: But the short term, you know, fasten your seatbelt and
Speaker 11: they say and put the trays in the upright position,
Speaker 11: because it all depends on what the White House says,
Speaker 11: and then next week, what does the Fed say about this?
Speaker 3: Max, you can name names if you want. You feel
Speaker 3: free too.
Speaker 11: Sure, I mean, I mean, it's interesting to see what
Speaker 11: is amagon Amazon going to say seventy percent of their
Speaker 11: goods are coming from China, basically over two and a
Speaker 11: half times what they sell from here. So what kind
Speaker 11: of inflation is that going to be we all say,
Speaker 11: and how they going to handle it?
Speaker 3: I think it'll be under an extra microscope given what
Speaker 3: we heard earlier this week after that punch Bowl News
Speaker 3: report sort of the back and forth from the White
Speaker 3: House about what ended up happening or or what you know,
Speaker 3: a call between Bezos and the President regarding being transparent
Speaker 3: about those prices and where that's coming from. There was
Speaker 3: a lot of back and forth there, So I think
Speaker 3: there will be a lot of questions about the impact
Speaker 3: on consumers. That's and you know, typically typically Amazon is
Speaker 3: a story that has to do less with retail and
Speaker 3: more with AWS, and we kind of got the preview
Speaker 3: of AWS yesterday with Microsoft. Okay, so that's some views
Speaker 3: on tariffs. What about the inflationary side of things, and
Speaker 3: that's certainly related to tariffs. How are you looking at
Speaker 3: about the inflation path forward?
Speaker 11: I still think it's stubborn, you know, we still think
Speaker 11: it's embedded in there, and we would not be for
Speaker 11: the FED cutting because we think inflation is still built
Speaker 11: into the marketplace.
Speaker 3: Which where specifically because we're seeing a moveway and oil prices,
Speaker 3: we're seeing lower oil prices. Where are you seeing inflation embedded?
Speaker 11: And well, basically you're seeing the consumer spending. You know,
Speaker 11: they're telling you that the prices went up a little bit.
Speaker 3: There.
Speaker 11: You're also seeing in the fact that housing right, well
Speaker 11: people aren't buying housing, but the cost of basically maintaining
Speaker 11: your home, you know, if you want to do repairs
Speaker 11: in your home, the cost of the wood, the cost
Speaker 11: of the products. We're seeing that as an issue. You're
Speaker 11: also seeing the fact that goods that are being bought
Speaker 11: are higher than they were. So the question really becomes
Speaker 11: is if the consumers anticipating higher rates or slow down
Speaker 11: they pull back on the spending. So well, yeah, you
Speaker 11: looked earlier about the cloud, but you look at the
Speaker 11: impact to consumer if they're facing day to day you
Speaker 11: look at companies like Procter and Gamble, it's telling you
Speaker 11: they're facing that issue with the products they're being selling.
Speaker 11: You know, that's the basics of what's them to the home.
Speaker 11: So the inflation still there. Yes, energy has come down
Speaker 11: a little bit, and yes, you know if they say
Speaker 11: food prices. But still when you look at it, the
Speaker 11: consumer is slowing down the spending. But is that is
Speaker 11: that going to be permanent? I don't know, because I
Speaker 11: can't tell you what we look like inflation. I think
Speaker 11: the Fed is too early to act. I think they
Speaker 11: need to be more patient because what you don't want
Speaker 11: them to do is jump the gun cut rates. And
Speaker 11: then you have the White House change of you know,
Speaker 11: the issue on tariffs, and next thing you know, you
Speaker 11: have inflation ticking up again. And I do think stagflation
Speaker 11: is a very big concern here, all right.
Speaker 4: So hmm, net net As you say, things can change,
Speaker 4: you know rapidly, we live it every day, every minute hour.
Speaker 4: Having said that, do you believe that things will settle
Speaker 4: at some point where higher tariffs though they're not the
Speaker 4: tariffs that they were, that there's going to be some
Speaker 4: higher level of tariffs and disruptions as supply chains, some
Speaker 4: maybe are brought indeed back to the United States, and
Speaker 4: things are changing that could ultimately lead to a very
Speaker 4: different investment environment going forward, a different level of profitability
Speaker 4: for companies here in the United States. I mean, what's
Speaker 4: the long term game that you think might be very
Speaker 4: different for the investment environment.
Speaker 11: Well, it's hard to predict the long term game because
Speaker 11: if you see.
Speaker 4: Are you saying it could just go back to the
Speaker 4: way it was before.
Speaker 5: I think it's going to go back the way it was.
Speaker 11: But I think the market's reflecting disruption, right if you
Speaker 11: look at takeout technology, the market's reflecting it. Consumers are reflecting,
Speaker 11: and energy stocks are reflecting it. Healthcare showing disruptions. And
Speaker 11: you have to ask yourself what's actually being and moved
Speaker 11: back here? I mean, what's happening really, not what's being
Speaker 11: talked about, but what's actually being moved here. Semiconductors are
Speaker 11: getting exceptions, but you have to look at what's happening
Speaker 11: with Taiwan. So long term, I am bullish, but I
Speaker 11: think you're going to be choppy from the next two quarters.
Speaker 11: I think the second half of the year as we
Speaker 11: get through this and really settle into what tariffs are
Speaker 11: really going to look like, and the companies have the
Speaker 11: ability to plan for it, and the consumers get used
Speaker 11: to what they have to deal with, and then you'll
Speaker 11: know where the FED is do. I think the Fed's
Speaker 11: going to cut interest rates to the fourth quarter probably.
Speaker 11: I don't want them to cut earlier because that means
Speaker 11: the economy is really slowing down.
Speaker 5: But it's hard to tell.
Speaker 11: I mean, if you look at right now, they said
Speaker 11: GDP was negative, but that was a pull forward from
Speaker 11: all the imports. People were front loading that. So the
Speaker 11: question becomes employment. Employment. A lot of the problems that
Speaker 11: you just had was New York related. Was a big uptick.
Speaker 11: But you have to wait. The economy is still strong,
Speaker 11: but we're seeing really good signs of a slowdown. I
Speaker 11: think the second half of the year, everybody be more
Speaker 11: adjusted to what we're actually dealing with, and I think
Speaker 11: that's going to create an incredible investment opportunity. Yep, you
Speaker 11: can look longer than three to six months, and.
Speaker 4: We do know that you are finding opportunities. Visa waste management,
Speaker 4: there's a couple of companies that you definitely have been buying.
Speaker 4: So any market environment, there are opportunities. Next time, we'll
Speaker 4: talk more about the specifics of that. Max Fasserman, founder,
Speaker 4: senior portfolio manager at mir or More Capital, around five
Speaker 4: hundred million in assets under management, joining us from Northbrook, Illinois.
Speaker 5: Folks.
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