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Speaker 1: Hi, everyone, Welcome to the weekend edition of Bloomberg Business Week. Well,
Speaker 1: we got another round of closely watched US economic reports
Speaker 1: this week on inflation, retail sales, and consumer sentiment to
Speaker 1: name a few. Bottom line tim the data really continuing
Speaker 1: to come in mixed, also showing persisting inflation and a
Speaker 1: miss on retail sales. So with that is our backdrop,
Speaker 1: Julie Van Allen, chief Revenue Officer over at Rakatin, stop
Speaker 1: by with some thoughts on the US consumer.
Speaker 3: Plus Boeing in the news again this week as many
Speaker 3: questions remain and it continues to face a fallout over
Speaker 3: a January accident in which the panel covering on an
Speaker 3: unused door on a Boeing seven thirty seven Max nine
Speaker 3: blew open during a flight. Those Boeing struggles giving Airbus
Speaker 3: a chance at aviation dominance.
Speaker 1: Yeah, headlines right, just continuing to cross. All right. The
Speaker 1: Chip War also on, as you know, as tensions escalate
Speaker 1: between the US and China. Chris Miller, New York Times
Speaker 1: bestselling author of Chip War, The Fight for the World's
Speaker 1: Most Critical Technology, will be with us later this hour.
Speaker 3: All of that to come. We begin with a quick
Speaker 3: check on the US consumer courtesy of the free app
Speaker 3: and a browser that provides coupons and discounts where shoppers
Speaker 3: are in cash back on purchases. More with Julie Van Ollen,
Speaker 3: chief revenue officer at Rakkaton, who we got up with
Speaker 3: just before this week's weaker than expected retail sales report.
Speaker 4: I mean, the trend continues where we got to wake
Speaker 4: up every day and see what's going on. It is
Speaker 4: still our moment is still that of pivoting and understanding
Speaker 4: what is the consumer doing today? And what I can
Speaker 4: say is that inflation continues to increase, as we all know,
Speaker 4: particularly in areas that impact the consumer gas, energy rent prices,
Speaker 4: and that really highlights a potentially negative impact on retailers
Speaker 4: as these consumers effectively look to save money. Now, saving
Speaker 4: money can come in all sorts of different forms. As
Speaker 4: we know, Raqutan offers a really valuable offering to our
Speaker 4: retailers and brands by way of giving value to consumers
Speaker 4: as cash back. Right, so we're very well positioned for
Speaker 4: a moment like this that we're calling cautiously out shopping
Speaker 4: last year is what we're seeing on our platform, largely
Speaker 4: driven by the fact that consumers do still seem to
Speaker 4: be interested in spending and from what we see actually
Speaker 4: out spending last year, but very much associated with categories
Speaker 4: and brands who are offering them the value that they're
Speaker 4: looking for.
Speaker 3: What are some of those categories, What are some of
Speaker 3: those brands if you can dig a little deeper into
Speaker 3: the data.
Speaker 4: Here, So the categories who have really leaned in heavily
Speaker 4: understanding that the consumer of today is looking for value
Speaker 4: and who have increased cash back rates over last year.
Speaker 4: We see the pets category doing extremely well, having grown
Speaker 4: over one hundred percent in trips year over year. We
Speaker 4: also see appliances in hardware, they're seeing an increase of
Speaker 4: twelve percent in average order value. Marketplaces also doing extremely well.
Speaker 4: Home and garden and travel is a real standout because
Speaker 4: typically Q one is a very promotional period for travel,
Speaker 4: and they spend quite a lot to lower consumers their
Speaker 4: way in Q one anyway, and this Q one has
Speaker 4: kind of not been too different, except there's even more
Speaker 4: leaning into those higher cash back rates to achieve the
Speaker 4: high price point purchases that they're looking for. And the
Speaker 4: travel has increased twenty two percent year over year for
Speaker 4: US in terms of trips.
Speaker 1: So when you say they're leaning in more to get
Speaker 1: that spend, I guess in their basket to get the
Speaker 1: cash back. So does that mean the retailer who's ever
Speaker 1: offering up the deal is in the driver's seat or
Speaker 1: is the consumer in the driver's seat because they're pushing
Speaker 1: for a better and better deal because they kind of
Speaker 1: need to.
Speaker 4: Well, it's a great question, and it's two sides of
Speaker 4: the same coin, you know. I think the consumers are
Speaker 4: if you look at this data, they're very clearly saying
Speaker 4: I have the money, and I will buy from retailers
Speaker 4: and brands who are willing to deliver me value. And
Speaker 4: I think the categories and brands who are doing well
Speaker 4: like the data we just reviewed, are the ones who
Speaker 4: are listening to that message and are reacting by offering
Speaker 4: higher cash back rates because it really is within their power,
Speaker 4: the brand and the retailer's power to use Racketin to
Speaker 4: offer more back to their shoppers.
Speaker 3: What typically proceeds a slowdown in consumer spending? Like, what
Speaker 3: are the signals that you could be looking for right
Speaker 3: now in the data that you have that would say, okay, well,
Speaker 3: the economy is indeed slowing down.
Speaker 4: I would say, which is something that we're not seeing today,
Speaker 4: is that if you are in a challenged economic moment
Speaker 4: where inflation continues, and you have a brand like Racketon,
Speaker 4: who has an offering that allows retailers to provide the
Speaker 4: value to the shoppers that they're looking for and that
Speaker 4: isn't working, that would probably be a sign that consumers
Speaker 4: really are pulling back. But we see the exact opposite
Speaker 4: that versus last year, brands are investing and shoppers are
Speaker 4: responding and outspending.
Speaker 3: Julie Van Allen, chief revenue officer at Racketin.
Speaker 1: All right now to a week that was also chuck
Speaker 1: full of news on Boeing. The full rundown, of course,
Speaker 1: can be found at Bloomberg dot com. Of note, though,
Speaker 1: the US Federal Trade Commission Chair Lena Kahan saying in
Speaker 1: a speech that Boeing became too big to fail after
Speaker 1: bought up domestic competitors and became the country's largest commercial
Speaker 1: aerospace maker. Meantime, Bloomberg News reported the Justice Department this
Speaker 1: week convened a grand jury as part of a criminal
Speaker 1: investigation into that mid air blowout.
Speaker 3: The controversy has become an opportunity for the company's loan
Speaker 3: major competitor, air Bus, and this is the topic of
Speaker 3: a story in the current issue with Bloomberg BusinessWeek. BusinessWeek
Speaker 3: Assistant managing editor Jim Ellis joins us with more.
Speaker 5: To change aircraft makers is a big deal for the airline,
Speaker 5: But we've gotten to a moment now where there's so
Speaker 5: much bad news. There's a lot of questioning about the
Speaker 5: quality of Boeing's equipment right now. That it comes at
Speaker 5: a particularly bad time for Boeing simply because a lot
Speaker 5: of people are starting to think of a lot of
Speaker 5: airlines are starting to think about the next generation of aircraft,
Speaker 5: and you know, a lot of people say, well, you
Speaker 5: know things are happening now, everybody's going to jump and
Speaker 5: run to Boeing. It's very run away from Boying. It's
Speaker 5: very difficult to do simply because you know, as you said,
Speaker 5: your crews are trained on that, and you've made these
Speaker 5: multi billion dollar investments. But what's at stake here is
Speaker 5: the next generation of planes. What happens is that because
Speaker 5: in the airline business you can use a piece of
Speaker 5: aircraft for decades, you don't make these decisions to change lightly.
Speaker 5: So instead it's time to think about the next generation.
Speaker 5: And so what Airbus is doing now is they're going
Speaker 5: to have some room to go ahead and say, I'm
Speaker 5: going to come up with a new plane at a
Speaker 5: time when Boeing is so, you know, sort of troubled,
Speaker 5: and so can consumed with thinking about how can it
Speaker 5: deal with its quality problems? How can it also deal
Speaker 5: with its balance sheet problems. I mean, Boeing is in
Speaker 5: the point right now where it doesn't have a lot
Speaker 5: of financial flexibility to build a new plane. And so Airbus, however,
Speaker 5: is probably about a fifty billion dollars advantage over it
Speaker 5: from a dead standpoint, and so they can move ahead
Speaker 5: and start planning for the next generation and sort of
Speaker 5: seal this dominance that they're probably going to have with
Speaker 5: the aircraft business.
Speaker 1: Jim tell us how fortunes can change, and I love
Speaker 1: how the story starts and you guys go back to
Speaker 1: nineteen eighty seven. If we can all remember back then,
Speaker 1: it's a while. It's a while, but talk about what
Speaker 1: happened and how that may be set the stage for
Speaker 1: where Airbus is today.
Speaker 5: Yeah, I mean what happened is a lot of people
Speaker 5: thought when Airbus decided to bring out it's a three
Speaker 5: twenty narrow body airline airliner. The people thought, oh, we're
Speaker 5: gonna do that. I mean, we've got the seven thirty seven.
Speaker 5: The seven thirty seven was rules the skies, and they
Speaker 5: come out with this A three twenty. They have a
Speaker 5: great party, they have, you know, sort of Prince Charles
Speaker 5: at that time with Lady Diana. I mean, it's big,
Speaker 5: big deal, fireworks and everything, and everybody says that's not
Speaker 5: going anywhere. You cannot beat them. They and at that
Speaker 5: time Boeing had ten times as many seven thirty sevens
Speaker 5: popping out than A three twenties. Fast forward to today
Speaker 5: and the A three twenty has become the best selling
Speaker 5: commercial aircraft of all time. I mean, that's that's a
Speaker 5: big deal, given that Bowe had commanded that market for
Speaker 5: so long, and the seven thirty seven has been a
Speaker 5: major player in aircraft for almost a half century.
Speaker 1: How much of that is the mistakes and problems that
Speaker 1: Boeing has had. How much of is it just folks
Speaker 1: started to kind of really like the A three twenty
Speaker 1: and shit their ordering books.
Speaker 5: A lot of it is that the A three twenty
Speaker 5: just sort of came in with a lot of innovations
Speaker 5: that you know, customers connected with what they call fly
Speaker 5: by wire, that sort of joystick, sort of all electronic cockpit,
Speaker 5: the idea that it was a slightly larger plane, which
Speaker 5: then set off this whole thing of continually making these
Speaker 5: planes bigger and bigger and bigger and bigger.
Speaker 1: I'm measure how big my seed is.
Speaker 5: I don't know about you guys that I know it
Speaker 5: turned out that they were in the right place at
Speaker 5: the right time. But they were also extremely you know,
Speaker 5: because they didn't have an older model that they were
Speaker 5: basically just retrofitting, they could think differently. They sort of
Speaker 5: took it and they ran with it, and now they're
Speaker 5: in a position to think about the next generation of
Speaker 5: airplanes that can find on sustainable fuel, that can do
Speaker 5: all sorts of you know, sort of electronic things in
Speaker 5: the cockpit. But also can take structures of airliners in
Speaker 5: a different way. They're planning a plane now for this
Speaker 5: next generation that has a wing that's shaped like a
Speaker 5: bird's wing that can actually change its shape and flight.
Speaker 5: And also because airports weren't built for these new giant
Speaker 5: planes that we're building now, they're going to have aircraft
Speaker 5: with the wing tips that fold up so you can
Speaker 5: still put it in the same place. But you know,
Speaker 5: and then we pulled away from the onto the Tormac
Speaker 5: flip the wings out. It's I mean, they are basically
Speaker 5: taking advantage of what they have right now, wh's a
Speaker 5: lot of money as well as not the look of
Speaker 5: all the stock markets saying, oh my god, you're a
Speaker 5: terrible company, you know, which is what Boeing has to
Speaker 5: deal with right now.
Speaker 3: Well, just like in the late nineteen eighties when Airbus
Speaker 3: was the upstart against Boeing, now there's another upstart out
Speaker 3: there that should have what, for practical purposes is a
Speaker 3: duopoly between Airbus and boone right but may not be forever.
Speaker 3: Enter what China has.
Speaker 5: Komac, China's aircraft company, which a lot of people in
Speaker 5: the West don't know because it has only so far
Speaker 5: built planes for Chinese carriers. But the thing to remember
Speaker 5: is that Chinese carriers have become major purchasers of Western aircraft.
Speaker 5: Most of the aircraft flown by the big three Chinese
Speaker 5: airlines are you know, Boeing or air Bus, and however
Speaker 5: a big percentage of the order books for these American
Speaker 5: and European companies come from Chinese airlines. Now China has
Speaker 5: decided it wants to be a player in the aircraft business.
Speaker 5: It feels like, why are they giving all this money
Speaker 5: to the West. They want to take that doopoly and
Speaker 5: make it into a triopoly, and that has got to
Speaker 5: be a frightening thing for Boeing especially.
Speaker 3: Can they pull that off outside of China in that
Speaker 3: wood regulators in the US and Europe well foreseeably approve.
Speaker 5: That's the question. And part of that is, you know,
Speaker 5: safety issue. Part of that is just engineering issue, and
Speaker 5: part of that is a political issue, you know, in
Speaker 5: the sense that you know, can China build an aircraft
Speaker 5: that flies? I mean they're doing it now, I mean
Speaker 5: the doing it for Chinese airlines, and they finally have
Speaker 5: gotten non Chinese airline though it's to bed air you know.
Speaker 5: That's but then they are also marketing it now to
Speaker 5: Western aircraft and they will find some sales there, but
Speaker 5: the issue becomes one of whether they want to take
Speaker 5: more of their own cares and sort of persuade them
Speaker 5: to buy Chinese and if they do that, that takes
Speaker 5: away a lot of the sort of extra stuff in
Speaker 5: the art books of the Western aircraft makers.
Speaker 3: Are Thanks to Bloomberg businesswek Assistant Managing editor Jim Alis.
Speaker 3: You can read this story and more out on newsstands now,
Speaker 3: on the Bloomberg terminal or at Bloomberg dot com.
Speaker 1: Slash BusinessWeek coming up, how global companies are fighting for
Speaker 1: the world's most critical technology, Navigating the chip boards with
Speaker 1: Chris Miller, author of a book by the same name.
Speaker 3: You're listening to Bloomberg Business Week. This is Bloomberg.
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Speaker 1: All Right news this past week, the Pentagon pulling out
Speaker 1: of a plan to spend as much as two and
Speaker 1: a half billion dollars on a chip grant to Intel.
Speaker 1: This is Chinese Premier Lee Chiong made the rounds of
Speaker 1: China's top AI and chip equipment firms over in China,
Speaker 1: calling for accelerating investments in those areas. The back and
Speaker 1: forth continued. We should point out Intel still gets money
Speaker 1: from the government under the Chips Act. But things are
Speaker 1: changing a little bit.
Speaker 3: Yeah, they certainly are. And then last week the US
Speaker 3: government pressed allies to further titan restrictions on China's access
Speaker 3: to semiconductor technology. Always a lot going on in the
Speaker 3: semiconductor space, you can count on that. And so we
Speaker 3: recently caught up again with Chris Miller, Associate Professor of
Speaker 3: International History at Tufts University.
Speaker 1: Timmy always remind us Chris was way ahead of the
Speaker 1: curve when it comes to the global battle in the
Speaker 1: chip space. He is the author of the New York
Speaker 1: Times bestseller Chip War, The Fight for the World's Most
Speaker 1: Critical Technology. The book came out in twenty twenty two.
Speaker 1: We began our conversation with Chris, like most do these days,
Speaker 1: on the growth of artificial intelligence and why chips semiconductors
Speaker 1: serve such a critical role.
Speaker 6: AI has really transformed the ship industry. It's the key
Speaker 6: demand driver going forward, and the big question hanging over
Speaker 6: AI is when will we start to see large scale modernization,
Speaker 6: How soon will that happen, and at what's scaled? Because ultimately,
Speaker 6: the reason why all the hyperscalers are investing tens of
Speaker 6: billions of dollars and building up AI infrastructure and buying
Speaker 6: lots of video GPUs is because they believe there's money
Speaker 6: that will be made at the end of this process.
Speaker 6: And that's why questions like well, how much does Microsoft
Speaker 6: makeoff copilot or what does open AI's revenue look like?
Speaker 6: These are the key indicators that investors are looking at
Speaker 6: to assess what will be the implication of AI for
Speaker 6: corporate profits.
Speaker 1: Well, Chris, how do you distinguish between the names and
Speaker 1: the space? You've got the once giants or leaders. I'm
Speaker 1: thinking of Intel, Texas Instruments, the new leaders, Nvidia, AMD
Speaker 1: has come so far, the company that seems to stand alone, TSMC,
Speaker 1: the semic and depwork companies, the equipment makers, Like, how
Speaker 1: do you distinguish How should the Bloomberg audience be thinking
Speaker 1: about a space that's got a lot of different names
Speaker 1: in them.
Speaker 6: Well, the good news is that as AI advances you
Speaker 6: actually need more types of chips in larger quantities to
Speaker 6: take advantage. It's not just the AI processors that you
Speaker 6: need that in Vidia produces. It's also more memory, especially
Speaker 6: the high bandwidth memory produced by companies like Skahi x
Speaker 6: or Examsung. And you also end up needing more mixed
Speaker 6: signal and analog chips because these are the chips that
Speaker 6: collect the data that's then being processed by AI systems
Speaker 6: and semi autonomous cars, for example. So that's why the
Speaker 6: boom and AI has benefited most companies in the industry,
Speaker 6: even if they're not directly producing the GPUs that are
Speaker 6: at the center of AI. And it's also why it's
Speaker 6: not just the chip designers themselves, it's also the tool
Speaker 6: makers from ASML to apply materials that are benefiting as
Speaker 6: chip making companies buy even more tools. But ultimately all
Speaker 6: of these do depend on their end customers continuing to
Speaker 6: invest in more and more semi conductors, and that's where
Speaker 6: the capital expenditure decisions of the big tech firms Microsoft, Google,
Speaker 6: Amazon and others will be e to sustaining this level
Speaker 6: of investment going forward.
Speaker 3: Chris, I want to go back to monetization and I'm
Speaker 3: so glad you brought it up, because it's something that
Speaker 3: we talk about a lot. We understand the beneficiaries on
Speaker 3: the chip side of AI, but at the same time,
Speaker 3: we do see company stocks near all time highs for
Speaker 3: companies investing in this type of technology, including meta platforms,
Speaker 3: Microsoft on the private side, Open ai, and others. What
Speaker 3: are the indications to you that we are seeing monetization
Speaker 3: at this point and when, in your opinion, do you
Speaker 3: think we're going to start seeing real efficiencies as the
Speaker 3: result of AI.
Speaker 6: Well, I think the news is that if you look
Speaker 6: across a much broader cross section of companies take the
Speaker 6: four to five hundred in aggregate, most companies on that
Speaker 6: list are at least exploring ways that they can use AI,
Speaker 6: either to refine their products or to drive down costs.
Speaker 6: And so the key it's not going to be I
Speaker 6: don't think any individual company or even any individual sector
Speaker 6: it's going to be and many different sectors learn to
Speaker 6: apply AI for many different use cases and that makes
Speaker 6: it harder to measure, but it also makes AI probably
Speaker 6: more sustainable in the long run if it's not one
Speaker 6: or two killer applications, but rather a lot of uses
Speaker 6: that end up being a creative either to company's profits
Speaker 6: or to driving down their costs. But for investors looking
Speaker 6: at this base trying to understand how real is this
Speaker 6: and how sustainable is the investment, it means you've got
Speaker 6: to look at a much broader cross section of companies
Speaker 6: to ascertain where is AI actually gaining traction and how.
Speaker 1: Do you roll into something like you know, Apple's making tips,
Speaker 1: Microsoft alphabet Google. Right, I think it's just kind of
Speaker 1: getting crowded, you know, more crowded if you will. I mean,
Speaker 1: how do you roll those guys into the already established players.
Speaker 1: Do you see them in the near future or in
Speaker 1: the longer term as being really pretty formidable in this industry?
Speaker 6: Well, I think they are in some ways already competitors
Speaker 6: to companies like AMD or in Vidia and companies that
Speaker 6: are big enough to have scale. The data center business
Speaker 6: like those that you mentioned, have a strong incentive to
Speaker 6: design their own ships, both because they can own their
Speaker 6: design so that they specifically match the workloads that those
Speaker 6: companies are running the data centers, but also because the
Speaker 6: more choice they have both in house design ships and
Speaker 6: externally designed ships, the more pricing power they hope they
Speaker 6: can win Visa be their biggest suppliers companies like in
Speaker 6: Nvidia for example, and so there's a market rationale as
Speaker 6: well as the technical rationale for companies to design their
Speaker 6: own in house ships. And what we've seen that, as
Speaker 6: you said, as a trend where almost every big tech
Speaker 6: company is now designing not just often once for themselves,
Speaker 6: but multiple different types of chips for their own data
Speaker 6: center efforts.
Speaker 1: We want to move on to the actual chip war,
Speaker 1: which is what your book was all about, because we
Speaker 1: feel like it just is picking up tensions. But before
Speaker 1: we do, which among the semiconductor companies that are out
Speaker 1: there do you find most interesting that you think we
Speaker 1: must I think about the investing audience. Bloombrick must always
Speaker 1: keep on your radar.
Speaker 6: We know a lot of people who are only paying
Speaker 6: attention to the space and alongside the rest of the
Speaker 6: tech sector, don't often focus enough on the tool makers,
Speaker 6: the companies that make the tools that make the chips possible.
Speaker 6: But if you look at the extraordinary growth and the
Speaker 6: industry over the past several years, it's not just the
Speaker 6: chip designers like in Video or AMD, it's also the
Speaker 6: companies that produce the tools, ASML or Land research or
Speaker 6: applied materials that are benefiting just as much from a
Speaker 6: lot of the growth in this industry.
Speaker 3: The US China battle for tech supremacy, chips are certainly
Speaker 3: at the top of the list AMD hitting roadblock because
Speaker 3: of US rules. Take a step back and just give
Speaker 3: us your impression about why the US is now pressing
Speaker 3: allies to make sure that China doesn't get its hands
Speaker 3: on certain types of chips, Like big picture, what's worst
Speaker 3: case scenario here? Like why does the US and its
Speaker 3: allies want to keep China from getting this technology?
Speaker 6: The US strategy, I think is pretty straightforward, and the
Speaker 6: dilemma of the US faces is this, by any metric,
Speaker 6: China will quantitatively outproduce the US in terms of military systems,
Speaker 6: whether it's ships or missiles or drones. China already has
Speaker 6: more and it will have even more of a quantitative
Speaker 6: edge in the future. And so the US is hoping
Speaker 6: it can retain its qualitative edge in terms of defense
Speaker 6: and intelligence systems by applying advanced computing and AI to defense,
Speaker 6: and doing so requires having better advanced computing and better
Speaker 6: AI than China. And that's at the core of what
Speaker 6: the US is trying to accomplish here. It's laser focused
Speaker 6: on AI chips and the machines that are capable of
Speaker 6: making cutting AGI chip with the aim of restraining the
Speaker 6: growth of China to AI, something keeping a technological edge
Speaker 6: that the United States have had for the past several decades.
Speaker 1: With that in mind, and I keep thinking about TSMC,
Speaker 1: you know, the ultimate fabricator. I mean, people can design chips,
Speaker 1: but ultimately they go to TSMC to make them and
Speaker 1: spit them out. How critical is it for the United
Speaker 1: States or other countries, you know, to back off of
Speaker 1: their dependency on TSMC.
Speaker 6: Well, I think you see a lot of interest in
Speaker 6: the US and Europe and Japan and elsewhere to have
Speaker 6: a more diversified manufacturing footprint, which is partly why TSMC
Speaker 6: is building new plants in the US, in Japan and
Speaker 6: in Germany. But the reality is that when it comes
Speaker 6: to AI processors in particular, like the GPUs that in
Speaker 6: video makes, almost all of them are manufactured by TSMC
Speaker 6: in Taiwan. So thus far we haven't actually seen much
Speaker 6: diversification at least when it comes to these ultra cutting
Speaker 6: edge chips.
Speaker 1: So how critical is it for the US to reduce
Speaker 1: that dependency.
Speaker 6: Well, I think you see that the United States spending
Speaker 6: a fair amount of money trying that Chips Act is
Speaker 6: going to spend forty billion dollars precisely on incentivizing firms
Speaker 6: to build factories in the United States, and Japan and
Speaker 6: Europe are doing the same thing.
Speaker 3: Does it go far enough here in the US because
Speaker 3: we have seen some prominent players pull back on and
Speaker 3: scale back on some of these plans in the US.
Speaker 6: Well, I think it's never going to be easy to
Speaker 6: see supply chains shift in a big way over a
Speaker 6: short period of time. The chip supply chain and the
Speaker 6: role of SMC was built up over many decades, and
Speaker 6: so it's just implausible to imagine the shift is going
Speaker 6: to happen quickly. And it's not going to happen quickly,
Speaker 6: both because it's hard and slow, but also because the
Speaker 6: reason TSMC has such an entrenched position is because its
Speaker 6: economies of scale have given it a technological edge, and
Speaker 6: so it's not just about any individual type of technology
Speaker 6: or subjody for any individual factory. It's the entire business
Speaker 6: model that gives a TSMC its position, and that's why
Speaker 6: the SMC is going to be very hard for any
Speaker 6: of its competitors to dislide the top of the foundry market.
Speaker 6: And why I really think most of the industry is
Speaker 6: expecting t SEC to remain the dominant player for a
Speaker 6: very long time to come.
Speaker 3: Is it realistic to think that if the US is
Speaker 3: successful in cutting off this technology to China, that China
Speaker 3: will not develop this on its own. I mean, after all,
Speaker 3: last August we got the news that in this Huawei
Speaker 3: phone there was a chip developed that was more than
Speaker 3: a generation ahead of where the US had sought to
Speaker 3: halt China's progress.
Speaker 6: Well, I think China is no doubt going to try
Speaker 6: to keep developing. It's both the microductor and its AI capabilities,
Speaker 6: and there are a very large number of very well trained,
Speaker 6: intelligent people in the country who are going to be
Speaker 6: focused on this effort. I think the question is really
Speaker 6: what's the technological gap between, for example, the tips that
Speaker 6: can be made in Taiwan and the tips that can
Speaker 6: be made in China. And what you find if you
Speaker 6: look closely, is that for certain types of chip that
Speaker 6: gap has closed someone but there still at least four
Speaker 6: year gap, maybe a five year gap between theating edge
Speaker 6: Taiwanese capability than the most advanced capabilities today in China,
Speaker 6: and we'll see if China can close that further. But
Speaker 6: the US is trying to prevent that, both by incentivizing
Speaker 6: it companies to race forward technologically via the tip back
Speaker 6: than other R and D funts, but also by making
Speaker 6: it harder and harder for China access cutting edge chip
Speaker 6: making tools.
Speaker 1: Chris, forgive me if I sound naive. I mean the
Speaker 1: stakes I understand as you lay it out very high.
Speaker 1: We know we've been reporting all the stories for countries,
Speaker 1: for companies right this tech battle for supremacy. Why does
Speaker 1: it have to be a fight? Why is it a fight?
Speaker 6: Well, the first ships that were invented were emerged essentially
Speaker 6: for use in guiding nuclear missiles more accurately, and since then,
Speaker 6: militaries and intelligence apties have seen computing as core to
Speaker 6: their ability to produce next generation systems. And at a
Speaker 6: time when you see every major defense ministry, whether it's
Speaker 6: in Beijing or in Washington or Tokyo, anywhere on the world,
Speaker 6: they're all right now trying to deploy AI to military
Speaker 6: systems to make them more capable, more efficient, more accurate.
Speaker 6: And this means that AI is not only going to
Speaker 6: be powering systems like CHATGPT. It's also to be use
Speaker 6: in military and intelligence cases as well, and that is
Speaker 6: a sphere where there's a really severere competition right now
Speaker 6: between China and the United States.
Speaker 3: You're also a consultant for several different firms or in
Speaker 3: depth several different capacities. I should know what's the number
Speaker 3: one question you get from executives at the companies you
Speaker 3: work with.
Speaker 6: The key question companies are asking is both what's next
Speaker 6: in Beijing and also what's next in Washington in terms
Speaker 6: of the types of regulation that we're going to see
Speaker 6: either from Congress or from the next presidential administration.
Speaker 3: That was Chris Miller, Associate Professor of International history at
Speaker 3: Tufts University. His book Chip War, The Fight for the
Speaker 3: World's most Critical Technology.
Speaker 1: All right, speaking of battles, up next, what one individual
Speaker 1: says is our biggest fight? A former owner of the
Speaker 1: La Dodgers and longtime businessman, Frank McCourt Junior on reclaiming liberty, humanity,
Speaker 1: and dignity in the digital age.
Speaker 3: This is Bloomberg.
Speaker 2: You're listening to the Bloomberg Business Week podcast. Listen live
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Speaker 7: Carol.
Speaker 3: I've been doing this thought experiment lately. It's a very
Speaker 3: informal poll, it's anecdotal. So what I do is I
Speaker 3: ask parents who have teenagers, neighbors, colleagues about a proposed
Speaker 3: TikTok ban, and I've heard the same thing from all
Speaker 3: of them. I hope this thing goes through. My kids
Speaker 3: spends way too much time on TikTok.
Speaker 1: That's amazing, So they're definitely in favor of a band well, Tim.
Speaker 1: The option could be on the table after the US
Speaker 1: House of Representatives pass to bill this past week to
Speaker 1: ban TikTok in the US unless it's Chinese owner sells
Speaker 1: the video sharing app. In response, China called on the
Speaker 1: US to stop unreasonably suppressing TikTok.
Speaker 3: It's not just TikTok that has its critics. People have
Speaker 3: a fraught relationship with all different types of technology. Think
Speaker 3: about it, hardware, software, apps, you name it.
Speaker 1: So how did we get here? While thinking a lot
Speaker 1: about this and on a solution to technologies grip on
Speaker 1: everything we do in the data controls is Frank McCourt, junior,
Speaker 1: Chairman of McCourt Global, a company with interest in real estate, sports, technology,
Speaker 1: media and more. Frank also the founder and executive chairman
Speaker 1: of Project Liberty, which in its own words, is advancing
Speaker 1: the responsible development of the Internet of tomorrow, designed and
Speaker 1: governed for the common good.
Speaker 3: Frank Mcott Junior also the author of the new book
Speaker 3: Our Biggest Fight Reclaiming Liberty, Humanity and Dignity in the
Speaker 3: Digital Age. We began by asking how this former owner
Speaker 3: and chairman of the La Dodgers, owner of a French
Speaker 3: football club, who worked in construction, real estate technology, went
Speaker 3: on to spend so much money and time fighting the
Speaker 3: Internet as we know it.
Speaker 8: So I wrote Our Biggest Fight to really shine light
Speaker 8: on Project Liberty, which is a five hundred million dollar
Speaker 8: initiative to reimagine how the Internet works and you know,
Speaker 8: and really take back control of our data, which I
Speaker 8: would say is really our personhood in this digital era
Speaker 8: from the kind of the machines of big tech.
Speaker 3: Right, Who're the machines?
Speaker 8: We are connected to the Internet by an IP address,
Speaker 8: so let's start right there. Okay, the Internet is not
Speaker 8: you and I connected, it's our device connected. It was
Speaker 8: built to connect devices, machines, and that's how the Internet
Speaker 8: came into being. And then thirty five years ago Tim
Speaker 8: Bernersley created the World Wide Web that was to connect data.
Speaker 8: We have never been connected as people on the Internet.
Speaker 8: So what I put forward in the book is now
Speaker 8: knowing how powerful the Internet is and how dependent we
Speaker 8: are on it, and how everything we do virtually is digitized,
Speaker 8: we need an Internet where we're in charge, or we're owning,
Speaker 8: in control, so to speak, our data, and we reclaim
Speaker 8: that personhood.
Speaker 1: Well safe to say we didn't know we were giving
Speaker 1: it up, right, We just thought, Wow, this is a
Speaker 1: really cool thing, and look at all the things we
Speaker 1: can do. And many would argue right at the same
Speaker 1: time that the Internet and that connectivity has allowed us
Speaker 1: to do so much more and learn so much more
Speaker 1: about the other. But then there's the dark side and
Speaker 1: bad side to it. Can we kind of regain our
Speaker 1: digital identity? Can we go back? Yeah?
Speaker 8: We must, we can, and we must, And I do
Speaker 8: want to focus on something first before I get to
Speaker 8: that solution and so forth, and I do think we
Speaker 8: are learning more and more about the harms, right, We
Speaker 8: hear them every day and.
Speaker 1: We talk about it all the time, and it's.
Speaker 8: Just going to get worse. As a generative AI enters
Speaker 8: the picture, because a broken technology made more powerful will
Speaker 8: just make the problems worse. But I want to just
Speaker 8: highlight one thing you said, you know, there are a
Speaker 8: lot of good things and then some bad things. I
Speaker 8: hear that a lot that we kind of somehow think
Speaker 8: of this tech anology differently than we would think of
Speaker 8: For instance, let's say we were sitting here and some
Speaker 8: municipality had a water system. They're putting water in a
Speaker 8: million homes, and you were reporting that four hundred thousand
Speaker 8: of those homes were getting toxic water, that we're making
Speaker 8: the household sick and killing some kids.
Speaker 1: Okay, would we sit.
Speaker 8: Here and say, well, yeah, but it's putting clean water
Speaker 8: in six hundred thousand homes, So kind of on bound?
Speaker 8: Why are we so tolerant of the harms of technology?
Speaker 8: Look at the Internet is ours, it's our data. We
Speaker 8: should be in charge. Why would we want machines to
Speaker 8: drag us into a future we don't want. Let's just
Speaker 8: take them inute fix it and then make it more powerful.
Speaker 8: And we fix it by putting individuals in control. I'm
Speaker 8: happy to talk about.
Speaker 3: So in this case, in this analogy, what's the toxic water?
Speaker 3: What are the harms being done?
Speaker 9: So?
Speaker 8: Yeah, so where to begin? Right, So let's think of
Speaker 8: about this. Let's think about it this way. Okay, I'm
Speaker 8: the head of the postal service, and I come to
Speaker 8: you and say I have an idea I'm going to
Speaker 8: give you. I'm gonna I'm gonna deliver your mail no
Speaker 8: stamps for free, So no more stamps. So you say, okay,
Speaker 8: I'm gonna listen. Maybe I'd be a little bit suspicious,
Speaker 8: but i'd listen. Then I'd say, okay, here's the deal.
Speaker 8: I'm gonna put cameras in every one of your homes,
Speaker 8: every one of the rooms in your house, in your car,
Speaker 8: in your workplace, and so forth, and I'm just going
Speaker 8: to surveil you twenty four to seven. You kind of
Speaker 8: be creeped out by that, right, and then say, well, yeah,
Speaker 8: but it's free. And then I say one more thing.
Speaker 8: I'm going to open your mail. I'm going to read it,
Speaker 8: and everything I learn is now mine. Okay, your relationships,
Speaker 8: your ideas everything else. And then you say, well that's
Speaker 8: I would never Why would I do that?
Speaker 2: That okay?
Speaker 1: And yeah, okay. Then I say, well we do it.
Speaker 8: Well, one other thing. I'm going to read your thirteen
Speaker 8: year old daughter's diary and now I'm and I'm gonna
Speaker 8: learn she's a little concerned about her weight. She's thirteen,
Speaker 8: she's insecure, a little vulnerable. I've got some stuff I
Speaker 8: want to sell her, and I'm going to profit from
Speaker 8: her insecurities.
Speaker 1: It's sick.
Speaker 8: It's not something we should be putting up with. And
Speaker 8: so my point is that we have a decentralized internet,
Speaker 8: something that Tim Bernersley wrote a letter. He said, I
Speaker 8: created something that was decentralized, that was intended to empower
Speaker 8: human beings, you know, the proverbial tie that lifts all boats,
Speaker 8: and it became something very centralized. And these big apps
Speaker 8: are scraping our data and they're applying algorithms and they're
Speaker 8: doing things with it that are not good for society.
Speaker 3: You're obviously so passionate about this, and I've got to
Speaker 3: ask do you have any sort of dog in the
Speaker 3: fight here? Like, is there do you have any sort
Speaker 3: of financial interest in creating a more open internet.
Speaker 8: I hope that our tech people will eventually build things
Speaker 8: in this new world, like with millions of other people.
Speaker 8: But our focus right now has been to put forward
Speaker 8: a piece of infrastructure, like digital infrastructure. We'll call it
Speaker 8: a protocol level piece called DSNP, which we've gifted to
Speaker 8: the world. It's basically like Tim Bernersley gifted HGTP. No
Speaker 8: one should own the Internet or own our relationships. That's
Speaker 8: the point we're trying to make here, and then we
Speaker 8: can all build on it. I would also add that
Speaker 8: we need to be creating a commercial ecosystem here that
Speaker 8: people will build on or all. This just is a
Speaker 8: nice idea that will never happen because these are huge,
Speaker 8: huge platforms. So I think, you know, we're sitting back
Speaker 8: and I'm seeing and feeling the same things that you
Speaker 8: all are about. Something's wrong. We're seeing the harms to kids,
Speaker 8: We're seeing our information ecosystem is completely contaminated. We're seeing
Speaker 8: democracy struggle. So we need to fix this. And so
Speaker 8: normally you go to these big tech CEOs and say,
Speaker 8: the problems are obvious, We've had hearings, have to hearing
Speaker 8: fix it. They haven't and they're not incentivized to fix
Speaker 8: it in the pre digital world. Then you go to
Speaker 8: your elected officials, you know, you go to Congress and say,
Speaker 8: look at the harms. You need to regulate this or
Speaker 8: have some new policies. We've see now for several years
Speaker 8: it's theater. Right, people show up, there's these big hearings,
Speaker 8: and Zuckerberg and the rest show up, and then nothing happens.
Speaker 8: Why our politics is impacted by this very same technology
Speaker 8: that just polarizes everybody and causes that paralysis.
Speaker 3: Well, that's it feels like that. I mean, it feels
Speaker 3: like every opportunity for a lawmaker to do something outrageous
Speaker 3: is an opportunity of them to create a click and
Speaker 3: raise money.
Speaker 1: Well, the whole thing that's going on with TikTok, I
Speaker 1: keep asking the question is it politics or policy that
Speaker 1: people are concerned about? And it just feels like people
Speaker 1: aren't concerned about politically what they can say and how
Speaker 1: it looks. TikTok ban. Should we ban it?
Speaker 8: Well, TikTok for sure is a problem for two reasons.
Speaker 8: One is again this surveillance aspect of it, where it's
Speaker 8: collecting all of our information and in TikTok's case, exporting it.
Speaker 8: The Chinese Communist Party has all this information on all
Speaker 8: of US American citizens. Of course that shouldn't happen. But
Speaker 8: the other point I want to make is the model
Speaker 8: of this extractive, exploitive, predatory technology where we're being essentially
Speaker 8: surveiled and our information is being scraped, is the same
Speaker 8: model that American apps are using, such as such as
Speaker 8: Facebook and Instagram and Twitter and Google and Amazon and
Speaker 8: so forth. It's all about our social graph, which is
Speaker 8: essentially all of our personal data. And that doesn't just
Speaker 8: mean where we shop or buy shoes, it's everything.
Speaker 3: Mark Zuckerberg has talked about this for years. He's used
Speaker 3: that term publicly, the social graph. I mean, he tried
Speaker 3: to get it sort of an iteration of it to
Speaker 3: take off in the Facebook news feed gosh back in
Speaker 3: like twenty twelve.
Speaker 1: But how do you get away from it even in
Speaker 1: the platform that you are offering up, Because in a
Speaker 1: digital world, doesn't something live somewhere always?
Speaker 8: So yeah, that's a great, a great question. First of all,
Speaker 8: I'm not offering up a platform. I'm offering up a roadmap.
Speaker 8: And the title of the book is not my biggest fight,
Speaker 8: it's our biggest fight. This is not going to happen
Speaker 8: unless we bring really millions of people into this conversation.
Speaker 8: And so what we're suggesting is we have a problem
Speaker 8: with the infrastrucure. Look, I'm a fifth generation builder. We
Speaker 8: build infrastructure.
Speaker 7: We have an.
Speaker 8: Infrastructure or engineering problem that we can fix and then
Speaker 8: build great stuff on it. But if we don't fix
Speaker 8: the tech, we're going to continually be spending all of
Speaker 8: our time and precious tax money and resources and so
Speaker 8: forth on putting out these fires and mitigating damage. Why
Speaker 8: not just fix the problem and then go start solving
Speaker 8: the other problems that the Americans want to see solved.
Speaker 8: So we need now not just to have a tech project,
Speaker 8: and Project Liberty is also a project that brings in
Speaker 8: civil society and brings in social scientists so that the
Speaker 8: next generation of the Internet is not just designed by technologists.
Speaker 3: Do you think this problem can be solved with the
Speaker 3: free market alone or the government needs to get involved?
Speaker 8: Another great question. I think we can definitely solve the
Speaker 8: tech problem with the free market alone, and we can
Speaker 8: build out the new let's call it the improved in channel.
Speaker 3: And that's a David and Goliath story, because you're talking
Speaker 3: about a startup essentially going against the biggest companies in
Speaker 3: the world.
Speaker 8: I like our chances if it's millions of people getting
Speaker 8: involved here. I don't like our chances if it's a
Speaker 8: little if it's an a David against a Goliath story,
Speaker 8: I don't like our chances. If it's a million Davids
Speaker 8: against the Golias. We will change this, and so I
Speaker 8: think this all can be changed eventually, once people see
Speaker 8: that there's an alternative to this, it doesn't have to
Speaker 8: be this way. Then I think the government will step
Speaker 8: in because they'll have to to make sure they facilitate that.
Speaker 1: Tell us what you would like to leave our audience.
Speaker 8: With, socialize this issue. Talk about this issue. I know
Speaker 8: there are millions of people out there seeing and feeling
Speaker 8: the same thing I am and you are, and so
Speaker 8: let's get it to the kitchen table. Let's get it
Speaker 8: to the sideline of the soccer game for the kids
Speaker 8: soccer game. Let's get it to the school board and
Speaker 8: to the parents in school. So let's talk about it
Speaker 8: after church. Let's socialize this issue, because I think we're
Speaker 8: going to find that millions and millions of people once
Speaker 8: they realize how their data is being used and how
Speaker 8: it's being turned to hurt them and harm them and
Speaker 8: harm their kids. They're going to be outraged.
Speaker 3: Our thanks to Frank mccot, junior chairman of McCourt, Global
Speaker 3: founder and executive chairman of Project Liberty, his new book,
Speaker 3: Our Biggest Fight, Reclaiming Liberty, Humanity, and Dignity in the
Speaker 3: Digital Age. Catch the full conversation on our podcast feed
Speaker 3: at Bloomberg dot com.
Speaker 1: And that wraps up our first hour of the weekend
Speaker 1: edition of Bloomberg Business Week from Bloomberg Radio Head. In
Speaker 1: our next hour, we talk luxury from fine lines to
Speaker 1: mighty fine and expensive South Florida real estate.
Speaker 3: Plus speaking of fine flying privately courtesy of the president
Speaker 3: and CEO of Sentient Jet, how it's going, and what
Speaker 3: he makes of some of the blowback against some celebs
Speaker 3: and others flying private jets quite a bit, you know.
Speaker 3: Taylor Swift gets a lot of flak for this.
Speaker 1: Yeah, but she's not alone, not alone, all right.
Speaker 3: This is Bloomberg Business Week. I'm Tim Stenebeck and I'm
Speaker 3: Carol Masser.
Speaker 1: Stay with us, everyone, Today's top stories in global business
Speaker 1: headlines coming up.
Speaker 2: Right now, you're listening to the Bloomberg Business Week podcast.
Speaker 2: Listen live each weekday starting at two pm Eastern on
Speaker 2: Apple car Play and Android Auto with the Bloomberg Business App.
Speaker 2: You can also listen live on Amazon Alexa from our
Speaker 2: flagship New York station, Just say Alexa Play Bloomberg eleven thirty.
Speaker 1: Plenty ahead in our second hour of the weekend edition
Speaker 1: of Bloomberg Business Week, including buying into Florida's luxury real
Speaker 1: estate market. What's hot and who's buying and how much
Speaker 1: they're spending.
Speaker 3: Yeah, and also if you want to get to that
Speaker 3: pricey Florida real estate, Carol, you're gonna need to jump
Speaker 3: on a plane, perhaps if you're not there, maybe even
Speaker 3: a private jet. We're gonna talk private aviation with the
Speaker 3: president and CEO of Sentient Jet, Andrew Collins. We'll hear
Speaker 3: from him in just a moment.
Speaker 1: Plus fun for me, fun for both of us as
Speaker 1: we went deep into the world of wine with Line
Speaker 1: and Spirits magazine editor in chief Josh Green. And guess
Speaker 1: what everyone younger generation drink and wine not so much?
Speaker 3: Yeah. First up this hour, the you surprivate jets skyrocketed
Speaker 3: during the COVID pandemic as wealthy people look to limit
Speaker 3: exposure to public spaces, and airlines curtailed services on many routes. Demand, however,
Speaker 3: slowed in twenty twenty three as economic uncertainty sparked concern
Speaker 3: and carriers began restoring schedules back to pre pandemic levels.
Speaker 1: All right, So for checking how the industry is faring
Speaker 1: the outlook for the year, we checked in again with
Speaker 1: Andrew Collins, president CEO of Sention Jet and co CEO
Speaker 1: of the parent company, Flexjet. You got right to it
Speaker 1: by talking about demand.
Speaker 7: If you look at it from a fractional ownership standpoint,
Speaker 7: there was a lot of selling that happened and a
Speaker 7: lot of pent up hours that happened. So we just
Speaker 7: have the most flying we've ever had in company history
Speaker 7: over President Day weekend.
Speaker 2: Right.
Speaker 7: If you look at it from a jet card standpoint,
Speaker 7: which is Sentient Jet, we did see it kind of
Speaker 7: start to soften, and in the on demand market it's
Speaker 7: really getting back to kind of a it's still growth
Speaker 7: over twenty nineteen, and you're still seeing some of the
Speaker 7: people retain from the pandemic, but it isn't like twenty
Speaker 7: one and twenty two where I think everybody was running
Speaker 7: around with.
Speaker 1: Their hair on dig into that demand over President's Day
Speaker 1: holiday where their deals Like, I don't know how you
Speaker 1: met it was industry, So what was it all about?
Speaker 7: No, it's it's you know, I'll tell you what. In
Speaker 7: twenty one and twenty two, it was long hours, long days,
Speaker 7: and every day felt like what we call a peak day.
Speaker 7: It just felt like everybody wanted to fly persistently. It
Speaker 7: used to be that like a Monday or a Tuesday
Speaker 7: or you know, you get a break. There was not
Speaker 7: a lot of breaks. Now what's happening is you're having
Speaker 7: high concentration days. And so in the fractional world, when
Speaker 7: somebody buys for a five year time horizon into an aircraft,
Speaker 7: they've bought the hours they're going to use that. So
Speaker 7: the owner demand for that spikes on certain days, and
Speaker 7: so collectively we've we've got the most hours under management
Speaker 7: we've ever had at a company. And it unlocked on
Speaker 7: President's station.
Speaker 1: How much as an inventory those hours? Like I'm always curious,
Speaker 1: like do you guys look at that of like, Okay,
Speaker 1: this is stuff that people have paid for, have to
Speaker 1: spend and use.
Speaker 7: Yeah, No, it's actually one of the main major keeps
Speaker 7: in our business. It's called hours under management, and you
Speaker 7: have to look at it by product, by aircraft, and
Speaker 7: you have to think about it. And that's how you
Speaker 7: do your demand, your demand shaping, how you think about
Speaker 7: capacity planning and everything else.
Speaker 1: How much visibility does it give you right now?
Speaker 7: It gives me very good visibility. Like the forward looks really.
Speaker 1: Good, twelve months, still good, twenty four months.
Speaker 7: Depends on how our year goes. From a selling standpoint.
Speaker 3: Interesting pilots having trouble getting pilots.
Speaker 7: No, I think the challenge for us. So we probably
Speaker 7: hired four hundred pilots at the flexjet level in twenty three.
Speaker 7: We'll do the same this year. I think what you
Speaker 7: have to think about is number one, we actually try
Speaker 7: to hire the best of the best pilots. We don't
Speaker 7: look for just any pilot, right.
Speaker 3: So, where are they coming from? Are they coming from
Speaker 3: regional carriers? Are they retiring from No.
Speaker 7: They could be coming from a competitor, They could be
Speaker 7: coming from a regional carrier, they could be coming out
Speaker 7: of the military. Okay, But what we found is you
Speaker 7: want to make sure that if you're hiring somebody, you're
Speaker 7: hiring on a track where they're going to stay through
Speaker 7: three years. They stay through three years, they're in for
Speaker 7: a career. We want it to be a career destination.
Speaker 7: We do find that. Excuse me, we're actually competing more
Speaker 7: with commercial airlines than we are any other competitor because
Speaker 7: the commercial airlines are really putting out large sums of
Speaker 7: money and large capes.
Speaker 3: They're unionized, and they're unionized.
Speaker 7: But what people forget is the history of commercial right
Speaker 7: where there's furloughs and things happen, and so you know,
Speaker 7: and so so it looks very rosy right now. I
Speaker 7: think we've got a pretty methodical plan and a pretty
Speaker 7: good destination for you as a career type. So yeah,
Speaker 7: we've we've put a lot of money into recruiting our pilots.
Speaker 1: It was an ideal pilot in terms of age and
Speaker 1: hours that they've already got.
Speaker 7: So you want somebody that's got the time and type.
Speaker 7: You want somebody that's experienced. You want somebody that has
Speaker 7: at least a minimum of three thousand hours. You know,
Speaker 7: he really has. Like we actually increased it recently as
Speaker 7: opposed to decrease it. Most people are decreasing it. That's
Speaker 7: why I wanted to ask you percent And that's actually
Speaker 7: a good bell weather for us. That just shows you
Speaker 7: the strength of who we are. We're trying not to
Speaker 7: fall into the trap of, you know, recruit at all costs.
Speaker 7: We're trying to get the best of the best.
Speaker 1: Can you remind us on pricing, give us an idea
Speaker 1: of like if somebody wants to take a trip and
Speaker 1: have you up in the last roe so.
Speaker 7: Like my mother, So I let me speak to it
Speaker 7: at the card level, because that's that's where I had
Speaker 7: a lot of experience. At the end of the day
Speaker 7: during the surge, when everybody wanted it, we the market
Speaker 7: would bear anything, right, and for us, we had to
Speaker 7: keep up with the market and keep pace and make
Speaker 7: sure we were living up to the consumer promise. So
Speaker 7: we had to augment pricing. So we augmented pricing probably
Speaker 7: by thirty five percent. It's the biggest jump I've ever
Speaker 7: seen and we've kept it there and the market is
Speaker 7: bearing it. It's it's our cell through is probably about
Speaker 7: ten to fifteen percent less than what we were doing,
Speaker 7: but we're very happy with the clients we bring in.
Speaker 1: Got it.
Speaker 3: Hey, I want to talk sustainability A little bit, because
Speaker 3: sustainable is not something you think of when you think
Speaker 3: about private air traps.
Speaker 1: And I'm going to tell you we're going to get
Speaker 1: a million of emails of people like you're talking private
Speaker 1: jets sustainability.
Speaker 3: Come on, you're burning dead Donalds.
Speaker 7: Come on, I'm happy to do it. It's my favorite topic.
Speaker 1: Are you following Elon's jet or.
Speaker 7: Yeah, I know all about it.
Speaker 1: Seriously, how do you think about it?
Speaker 3: I mean, you guys hit a milestone recently, but it's
Speaker 3: carbon offsets, right.
Speaker 7: No, it's more than carbon offsets. You want to do
Speaker 7: full emissions. So this is the big mistake that people
Speaker 7: make in our industry, and we're trying to actually lead
Speaker 7: the pack. So we do three hundred percent offsetting and
Speaker 7: it's built into the pricing. It is no cost to
Speaker 7: the consumer. This is a choice we made three and
Speaker 7: a half years ago, and even during the time when
Speaker 7: we had to pay operators lots of money during the
Speaker 7: surge and really think about things, we never wavered on this.
Speaker 7: This is really important to us. You do a full
Speaker 7: emissions offset, it's not just doing carbon you know, a
Speaker 7: carbon offset, you're getting water, vapors, aerosols, you know, every
Speaker 7: imprint that you possibly can. You're factoring that in, and
Speaker 7: we work with a partner who's gone through and certified
Speaker 7: a lot of different projects to help us with this,
Speaker 7: plus registering our offsets and everything else. So it's really
Speaker 7: important to us. We've probably offset about one point three
Speaker 7: one point four million metric tons of carbon DIX set
Speaker 7: at this point, and we're going to keep going and
Speaker 7: we've got millions earmarked for it. We need to get
Speaker 7: to a world of sustainable aviation fuel and we need
Speaker 7: to get this electric kind of world to happen, and
Speaker 7: it's going to happen further out than we hoped ten seconds.
Speaker 1: How quickly can we get there?
Speaker 7: Seven years?
Speaker 1: Seven years?
Speaker 7: Yeah, it used to be five. Everybody would say five.
Speaker 7: I think mass consumer, mass passenger. You'll see some hybrids,
Speaker 7: but I think it's about five to seven years minimum.
Speaker 3: That was Sentient Jet president and CEO Andrew Collins, also
Speaker 3: the co CEO of parent company, flex Jet, And that's
Speaker 3: what's going on with the exclusive world of private flying
Speaker 3: and Carol speaking of the luxury world, Yeah, I guess
Speaker 3: you could say we're going to get another check on it,
Speaker 3: specifically South Florida real estate and how well it's doing.
Speaker 9: Yeah.
Speaker 1: Case in point, remember we just we recently talked about
Speaker 1: it was a Wall Street Journal story. It was about
Speaker 1: one hundred and twenty million dollar ocean front penhouse in
Speaker 1: Miami Beach, said to be in contract for north of
Speaker 1: one hundred and twenty million.
Speaker 3: It's so expensive.
Speaker 1: Yeah, if you have to ask, what did we say? Yeah,
Speaker 1: tenaford some that would make it the most expensive condo
Speaker 1: medium ever sold in the Miami area. This according to
Speaker 1: people familiar with the deal. The previous record was half
Speaker 1: that price. This is again according to the journals reporting.
Speaker 3: Okay, the migration down south to Florida, it's not anything new.
Speaker 3: We've reported on all the financial folks heading to Florida.
Speaker 3: Citadel's Ken Griffin and others now calling South Florida home
Speaker 3: and pushing up demand and prices of commercial and residential
Speaker 3: real estate as a result.
Speaker 1: And so with all this in mind, we spoke at
Speaker 1: Dinette Golden Tayer, executive director of sales over at Douglas Element.
Speaker 1: She joined us from Miami and says, well, the season
Speaker 1: definitely busy.
Speaker 10: Our market, as they say, is calliente and there is
Speaker 10: no sign of a slow down for the ten.
Speaker 1: Million plus marketplace this time.
Speaker 10: Last year, we in fact had a much slower high season,
Speaker 10: high season being defined as the months of December, January, February,
Speaker 10: March April, when the snowbirds will want to be here.
Speaker 10: And this year we're having the type of high season
Speaker 10: that we had hopes for last year, which is pending
Speaker 10: sales almost every other day for high quality assets that
Speaker 10: are appropriately priced.
Speaker 3: Who are the buyers right now and how are they buying?
Speaker 3: Are these all cash buyers? Where are they coming from?
Speaker 3: Give us insight there, They're.
Speaker 10: The usual suspects. They are coming from New York, from
Speaker 10: other Northeastern states, They're coming from California and other Western states,
Speaker 10: and they're coming from Canada. The European buyer has slowly
Speaker 10: trickled back into the marketplace post COVID, but they're not
Speaker 10: as strong as they were in prior years.
Speaker 3: What about buyers from Asia and buyers from Russia.
Speaker 10: No, and no, And the buyers that I'm working with
Speaker 10: are not getting mortgages, or at least the deals are
Speaker 10: not finance contingent.
Speaker 1: What's a typical deal on the high end of Miami.
Speaker 1: You used ten million dollars as a price point. Is
Speaker 1: that kind of the median give us an idea, because
Speaker 1: I know that they can go a lot higher, especially
Speaker 1: if you do something like Indian Creek Village, which Bloomberg
Speaker 1: has written about as being a place where millions don't matter.
Speaker 1: It's all about billions and billionaires.
Speaker 10: Ten billion gets you a nice condo, It gets you
Speaker 10: a nice house, a very nice house, not in the water,
Speaker 10: an average house on the water. Twenty million is where
Speaker 10: it's at if you want something better than nice and
Speaker 10: my twenty million plus product. I have the shortest days
Speaker 10: on market than any other sector that I represent. In fact,
Speaker 10: it takes me longer to sell properties five to fifteen
Speaker 10: million than homes that are over twenty million, where I
Speaker 10: average about one hundred and twenty to one hundred and
Speaker 10: fifty days on market.
Speaker 3: Do you know who's selling right now, who doesn't want
Speaker 3: to be there, and who wants to sell for these prices?
Speaker 6: Sure?
Speaker 10: I mean that is a broad question because people selling
Speaker 10: don't necessarily not want to be in Miami. They may
Speaker 10: be expanding their family, or they may be going through
Speaker 10: a divorce. A lot of the people that for whom
Speaker 10: I sell, or they are staying locally, just in a
Speaker 10: different asset class like downsizing or upsizing, or moving from
Speaker 10: a house to a condo or vice versa.
Speaker 1: You know two was asking earlier Diana about who's doing
Speaker 1: the buying, and we've talked. Do you know Bloomberg has
Speaker 1: done a lot of reporting about kind of Wall Street
Speaker 1: South and the amount of financial folks that I've moved
Speaker 1: down there, not only to live or buy a second home,
Speaker 1: but to actually set up shop and do work, and
Speaker 1: that has certainly had an impact on the Eric. Give
Speaker 1: us little bit more color if you can around what
Speaker 1: you were seeing on that front specifically. Is the pace continuing,
Speaker 1: is it picking up? Is it slowing down at all?
Speaker 10: I think if we compare the pace to the COVID times,
Speaker 10: it will always feel like a slowdown. Now Miami and
Speaker 10: Miami Beach, where I specifically focus on, has found a
Speaker 10: new rhythm. We continue to have an influx of the
Speaker 10: Wall Street types and other financiers from around the country.
Speaker 10: They are still taking prime positions at the schools for
Speaker 10: their children and the top reservations in town because we
Speaker 10: have pretty much the same restaurants that New York City does,
Speaker 10: if not better right now, so the pace is healthy,
Speaker 10: It's just not a COVID pace, and to compare it
Speaker 10: to that would always look like we're in the run.
Speaker 3: What about folks with backgrounds in crypto right now, especially
Speaker 3: given the rise in crypto that we've seen last year
Speaker 3: and in recent months.
Speaker 10: I'm glad you bring it up, because crypto certainly had
Speaker 10: a great couple of weeks. But I have not seen
Speaker 10: the complete return of the crypto bros. And in fact,
Speaker 10: when I did work with that fire class, they always
Speaker 10: paid cash.
Speaker 1: Well, yeah, but cash is cash, Yeah, got it, Yeah,
Speaker 1: no problem here, easy close, quick closed.
Speaker 10: But I haven't gotten a few calls lately asking if
Speaker 10: a seller would take crypto, so it is starting to
Speaker 10: come back as a subject point.
Speaker 3: Yeah, and I guess I was more interested in just
Speaker 3: the crypto Bros part of it. But I'm surprised that
Speaker 3: you know, you haven't seen the return of crypto Bros
Speaker 3: Completely that we saw a couple of years ago.
Speaker 10: No, and even you know, they're already down here, they've
Speaker 10: already established residency. So if they're going to be perhaps
Speaker 10: upgrading because they're Crypto's high great, I'm excited to work
Speaker 10: with them again. But they're not the conversation at the
Speaker 10: height of the topics that are being discussed around town.
Speaker 3: That was Dina Golden Tayer, executive director of Sales at
Speaker 3: Douglas Ellman.
Speaker 1: You're listening to Bloomberg BusinessWeek. Coming up, we talked wine,
Speaker 1: We sample wine with the editor in chief of Wine
Speaker 1: in Spirits magazine.
Speaker 3: This is Bloomberg.
Speaker 2: You're listening to the Bloomberg Business Week Podcast. Catch us
Speaker 2: live weekday afternoons from two to five pm. Easter Listen
Speaker 2: on Apple car Play and and Brout Auto with a
Speaker 2: Bloomberg Business app or watch us live on YouTube.
Speaker 1: At the beginning of each year, Wine in Spirits polls
Speaker 1: what it considers the best restaurants all over the US
Speaker 1: to get a better understanding of where the wine industry
Speaker 1: is and where it's going. Things such as the most
Speaker 1: popular wines at that given time and more.
Speaker 3: The results of the poll they're not out yet, but
Speaker 3: we did get a little sneak peek with Wine and
Speaker 3: Spirits magazine editor in chief Josh Green. He joined us
Speaker 3: in the Bloomberg Studio, where he started out by giving
Speaker 3: an overview of challenges facing the wine industry.
Speaker 9: Things are a bit of a struggle in the wine
Speaker 9: industry right now. In fact, I think that the supply
Speaker 9: issues never really balanced out, and that in addition to
Speaker 9: a lot of changing demographic trends, have really hit the
Speaker 9: industry pretty hard this past year. We saw it in
Speaker 9: our poll and we also saw it in some data
Speaker 9: that was just released by SIP Source, which is part
Speaker 9: of WSWA, the Wine Spirits Wholesaler Association, where they look
Speaker 9: at polesalar depletions and in year over year twenty two
Speaker 9: to twenty three, volume was down by eight point one percent.
Speaker 9: And Nielsen, I.
Speaker 1: Think story was taken down because of a lot of how.
Speaker 9: Many it's really people don't really know exactly what. I
Speaker 9: don't think people know exactly what's going on. I think
Speaker 9: that people say that young people are drinking less. Whether
Speaker 9: young people want to be drinking less or just simply
Speaker 9: can't afford to be drinking at the prices that wine
Speaker 9: costs now is another question, and that's something.
Speaker 3: Dollars bottle of wine they're great. Twenty dollars bottles of
Speaker 3: wine they're great, they're grete. Twelve dollars bottles are one.
Speaker 1: Yeah, exactly.
Speaker 3: I think there's no We've talked about this a lot,
Speaker 3: but there's no question that the younger demographic is not
Speaker 3: drinking at the same rate that previous demographics were. Athletic brewing,
Speaker 3: you know, the non alcoholic year Love, which they are
Speaker 3: the top selling beer at Whole Foods right now, including
Speaker 3: all the alcohol inclusive beers too. So I think that
Speaker 3: speaks to sort of a changing shift and how consumers
Speaker 3: are thinking about it. But it's interesting to hear that
Speaker 3: about Whine too well.
Speaker 9: And in our poll, what we did this year was
Speaker 9: quite different from how we've done it in the past,
Speaker 9: because I think polling has really radically changed across the board.
Speaker 9: I mean, I just heard something on the news this
Speaker 9: morning about how respondents used to be like seventy percent
Speaker 9: of polls and now it's one percent if you're lucky,
Speaker 9: So you think it might be some issues with the data,
Speaker 9: not with no what I'm saying is that we did
Speaker 9: it completely differently this year. So what we did was
Speaker 9: we called we literally called an interview to one hundred people,
Speaker 9: and we selected who were going to call, and we
Speaker 9: had twelve people on the team doing it, and we
Speaker 9: asked them all the same questions right down the line,
Speaker 9: and so we gathered the information differently than we have
Speaker 9: in the past, which was having people fill out a
Speaker 9: form in the past, and so it's it's less data
Speaker 9: than we've had in the past, but it's a very
Speaker 9: different We're asking very different questions.
Speaker 1: More nuanced or more do you feel like, more specific
Speaker 1: in terms of the way you guys did.
Speaker 3: It, it's more it's more nuanced. And it's also that
Speaker 3: we were able to do a lot of follow up
Speaker 3: questions with people on the spot, you know, when people
Speaker 3: would tell us that they were that they were moving
Speaker 3: in this direction or that direction, that we could really
Speaker 3: then pin them down to why and what was what
Speaker 3: that was about. And it really what what was fascinating
Speaker 3: to us is that it filled it mirrored exactly what
Speaker 3: you're talking about, Tim with. I mean, we heard so
Speaker 3: much about non alcoholic wine and non alcoholic cocktails, which
Speaker 3: we've never heard about before in our polls. Ever.
Speaker 9: Yeah, a lot of people who are doing tasting menus
Speaker 9: with pairings would traditionally do like they've now turned to
Speaker 9: doing a tasting menu and a vegan tasting menu or
Speaker 9: a or vegetarian tasting menu. Plus they've turned to doing
Speaker 9: alcoholic pairings and non alcoholic pairings. And I'm just trying
Speaker 9: to find that I think it was Stephen Schaeffer at
Speaker 9: MAGO in Oakland. He said that they sold the same
Speaker 9: number of non alcoholic pairings as alcoholic pairings for them all.
Speaker 3: That's so surprising. That was a quick shift completely.
Speaker 1: What does it mean for the wine industry.
Speaker 9: It means it's going to be a lot of soul
Speaker 9: searching and there's going to be a lot of change
Speaker 9: and what to me, what's interesting about the results of
Speaker 9: the poll this year is that we spoke with the
Speaker 9: really creative leaders of you know, the people who are
Speaker 9: trying to find ways to connect with their guests about
Speaker 9: what they want to be drinking. And so we heard
Speaker 9: a lot about what these creative wine directors are doing
Speaker 9: to deal with this trend of people drinking less and
Speaker 9: the volume is down. I haven't seen numbers about the value.
Speaker 9: So the industry may not be hurt as badly on
Speaker 9: value as volume.
Speaker 3: Meaning raising prices in order to compensate for lost volume,
Speaker 3: meaning that the wines that are selling not necessarily raising prices,
Speaker 3: but the wines that are selling are at a higher
Speaker 3: point price point than you know that there was a
Speaker 3: lot of wine being sold in this market at you know,
Speaker 3: there was two buck chuck right, and now now now
Speaker 3: people are looking at twelve dollars wine rather than tubuck chock.
Speaker 1: It's funny, my husband who loves ra there's Josh there
Speaker 1: you go. I think would much rather have a bottle
Speaker 1: of really expensive or a nice, really nice bottle of wine,
Speaker 1: maybe less frequently versus maybe not as expensive and maybe
Speaker 1: not as good. I hate, I hate to do price
Speaker 1: and quality because I do think you can find some
Speaker 1: great inexpensive wines. But you know what I'm saying, like,
Speaker 1: make it an experience and be something.
Speaker 9: I think people find a lot of value in that,
Speaker 9: in that experience, and I think that the industry is
Speaker 9: moving in that direction to provide experiences.
Speaker 3: A lot of Yeah, a lot of younger people appreciate
Speaker 3: buying into an experience rather than just buying alcohol. So
Speaker 3: there's a lot of a lot of what's going on
Speaker 3: in the transitions in the industry are developing these kind
Speaker 3: of experiences for people.
Speaker 1: And Josh and we want to talk a little bit
Speaker 1: more about kind of some of the trends that you're seeing.
Speaker 1: As we do this, we are going to have Stephen
Speaker 1: Schmitz is here with us, who came along with you
Speaker 1: and he's going to open up a bottle of wine
Speaker 1: for us so that we can sample a little bit.
Speaker 1: I think the first wine is a white wine from
Speaker 1: the Azors.
Speaker 3: Okay, nice pronunciation.
Speaker 1: How do you say it so that we all know?
Speaker 9: Well, in the United States we say as but in
Speaker 9: Portugal would say.
Speaker 3: That was not trouble.
Speaker 1: Is that one of the trends that we're seeing in
Speaker 1: terms of wines that people are either asking for or
Speaker 1: restaurants are playing with. What are you saying?
Speaker 7: So?
Speaker 9: What the main trend that we saw in the.
Speaker 3: Poll was that a lot of the leaders in the
Speaker 3: in the wine director industry, you know, the Samia industry,
Speaker 3: they are looking for alternatives to the big name wines
Speaker 3: and the high priced wines, and they're looking for legitimate
Speaker 3: alternatives to them because these are very A lot of
Speaker 3: the restaurants we poll are very high level restaurants with
Speaker 3: a lot of they're not inexpensive.
Speaker 9: But one of the things we asked was what new
Speaker 9: category or region did you add this year that got
Speaker 9: the most traction on your list and the more people
Speaker 9: So thirteen out of one hundred people said Portugal that
Speaker 9: was the most of any region. That people respond, why
Speaker 9: is that well, many people said that it's because people
Speaker 9: are traveling there. Everybody's going to port So my parents
Speaker 9: are going to Portugal in a few weeks. Everybody's going
Speaker 9: to Portora.
Speaker 3: So it used to be that the people would go to
Speaker 3: Tuscany come back and want to drink kiante, and now
Speaker 3: people are going to Portugal and coming back in wanting
Speaker 3: to drink Portuguese wine. And so this is a Portuguese
Speaker 3: wine that we brought, and this is like this killer wine.
Speaker 3: So we actually brought two wines from our top one
Speaker 3: hundred event that we just did two weeks ago. In
Speaker 3: we say, so this is from the Azorsh and it's
Speaker 3: from a Rinto dais Orsh, which is a white grape,
Speaker 3: and the vines are more than one hundred years old,
Speaker 3: so it is very concentrated. Yeah, it's also in a
Speaker 3: place it's very windy, so that deepens the concentration of
Speaker 3: the wine even more because the wind is drying out
Speaker 3: the the grapes a bit. And it also has a
Speaker 3: lot of salinity because you get all of the ocean
Speaker 3: spraying salt into the land there. Yeah, so really it's
Speaker 3: really good.
Speaker 9: I really like this. I love this wine.
Speaker 1: I'm not a huge fan of white wines. This is lovely.
Speaker 3: What's what's the what's the varietal of this wine?
Speaker 9: So the Vrietyl is a Rinto, but it's a Rento
Speaker 9: of the Azores. Okay, so this would be obviously much
Speaker 9: like crisper and finer if it's colder. But we like
Speaker 9: to show the wines at sort of cool room temperature
Speaker 9: so you can actually really taste them. And I think
Speaker 9: length on this wine is extraordinary.
Speaker 6: Ah.
Speaker 1: We also then seeing I'm assuming as people are traveling
Speaker 1: and bringing, you know, what they find overseas or in Portugal,
Speaker 1: that restaurants are responding in terms of expanding what's on
Speaker 1: the wine list a little bit.
Speaker 3: Yes, the offerings.
Speaker 1: So what was fascinating to me, Steve, and you can
Speaker 1: go ahead, and I know he's got another. We're going
Speaker 1: to move from white to red in a moment, So
Speaker 1: Steven's going to open up.
Speaker 3: You've done with your white, We've done. We've pulled these
Speaker 3: restaurants for thirty five years. We've never heard a peep
Speaker 3: about Portugal, not like barely a mention in any description
Speaker 3: of wines that they were selling. And this year Hawksu
Speaker 3: kim at per Se was talking about it. Although some
Speaker 3: at La Berna, Dan was talking about it. Across the country,
Speaker 3: people were talking about it. Yeah, it was really surprising.
Speaker 1: That's recognition. I mean, you're talking about your top restaurants.
Speaker 9: Well, although although was saying that he has a wine
Speaker 9: called Kosh from a producer called Newport in the door
Speaker 9: and there's a wine that is made in a similar
Speaker 9: style to a white Burgundy, but it's obviously very different
Speaker 9: grapes and it's a very different climate, but it gives
Speaker 9: you the same It sort of scratches the same mitch
Speaker 9: as a white pergony would. And he poured it for
Speaker 9: a couple of collectors who had come in that don't
Speaker 9: know about Portugal wine at all.
Speaker 3: They loved it. They wanted to buy a case of it.
Speaker 3: When they left, they were completely enthralled with it. Carol
Speaker 3: just poured the red.
Speaker 1: The red. I just poured the red. We're going to
Speaker 1: pass it around. In terms of pricing, I mean, like
Speaker 1: I said to you, I have expanded my mind a
Speaker 1: bunch over the last.
Speaker 3: Few years ago, but not all the way to tubuc Chuck.
Speaker 1: No, not to two buck check. But in terms of
Speaker 1: talking to folks like you and others and really kind
Speaker 1: of learning in that I'd like to try things. And
Speaker 1: it's amazing the amount of variety that you can get
Speaker 1: in terms of the cost of wines. And just because
Speaker 1: it's less expensive doesn't mean it's a bad wine.
Speaker 9: No, these two wines are not less expensive because they
Speaker 9: are from They are two of the best wines we.
Speaker 3: Tasted last year. Don't spill in other so yes, so
Speaker 3: they do make a less expensive wine from Orientto and
Speaker 3: also from Verdeo that's beautiful as well, but it's not
Speaker 3: as concentrated and rich, and it's lighter and fresher, but
Speaker 3: it's from much younger vines, not one hundred year old one.
Speaker 1: That's the real difference usually typically or.
Speaker 3: What what you get with an older vine. I mean,
Speaker 3: it's interesting. I brought the magazine with me for you
Speaker 3: guys to look at after, and I have an article
Speaker 3: in here about old vines in Austria.
Speaker 9: I talked a lot with people over there about what
Speaker 9: they're getting from old vine fruit that's different from younger
Speaker 9: vine fruit, and how they're sustaining their old vines to
Speaker 9: do that, and you get the concentration that you wouldn't
Speaker 9: otherwise get. You get a different maturation process during the
Speaker 9: growing season. So what Kathy Corson, We're drinking Kathy Corson's cabernet. Now,
Speaker 9: what she's done is she's sustained very old vines in
Speaker 9: Napo Valley. She is probably the oldest cabernet vines in
Speaker 9: one block in Napo Bally seventy two. I think they
Speaker 9: were planted. And this is from her own other grapes
Speaker 9: and from some purchase grapes, but all in that same area.
Speaker 3: That was Wine and Spirits Magazine editor in chief Josh Green.
Speaker 1: All right, mister Stenovick, speaking of fine wine and dining,
Speaker 1: how about a sandwich to go with a nice bottle
Speaker 1: of wine.
Speaker 3: You can pare anything with a bottle of wine, Carol.
Speaker 3: I don't care what people said.
Speaker 1: I thought you're gonna say you could pair anything.
Speaker 3: With You can't pare anything with a good sandwich. That's
Speaker 3: not what I'm worried about. I'm worried about people being like, Okay,
Speaker 3: you know you can't have this wine with this sandwich.
Speaker 3: Just eat the sandwich, Okay. Well, we've got the most
Speaker 3: sumptuous choices in London, along with the Rodeo that's changing
Speaker 3: lives for young black wranglers, Bloomberg Pursuits as straight Ahead
Speaker 3: on Bloomberg BusinessWeek.
Speaker 1: This is Bloomberg.
Speaker 2: You're listening to the Bloomberg Business Week Podcast. Listen live
Speaker 2: each weekday starting at two pm Eastern not Apple Car
Speaker 2: Play and Android Auto with the Bloomberg Business And you
Speaker 2: can also listen live on Amazon Alexa from our flagship
Speaker 2: New York station, Just say Alexa, Play Bloomberg eleven thirty.
Speaker 1: All right, Tim skiing and Scandinavian. I would love to surprise, surprise,
Speaker 1: howbout a wild ride courtesy of the Bill Pikett Invitational Roadie.
Speaker 3: I can ride horses. I could do this.
Speaker 1: Okay, check check, and one thing I know is a
Speaker 1: slam dunk for you for sure.
Speaker 3: Sandwiches say no more, Carol, the Key to My.
Speaker 1: Heart eats one in the four o'clock hour of our show.
Speaker 1: Every day.
Speaker 3: A Sandwich Day keeps the doctor a little live on
Speaker 3: the radio. Yes, I do well.
Speaker 1: During a break, she's got a too quick before we
Speaker 1: get on air. All of this recently being covered by
Speaker 1: our Bloomberg Pursuits team, led by the Editor Pursuits, Chris
Speaker 1: Rouser and Chris Let's start with the Pursuit story on
Speaker 1: the best sandwiches found in and around London, courtesy of
Speaker 1: the top chefs there, and brought to us by none
Speaker 1: other than the food editor Pursuits Kate Creator, who also
Speaker 1: joins us from London. Kate, Hello, Hello, Hi, Hi.
Speaker 11: Which is I hope you're reading a sandwich right now?
Speaker 3: You know it depends on what your definition of a sandwich,
Speaker 3: which is Kate, because there's a lot of debate about this.
Speaker 11: Well, you're speaking from the right place to have that debate,
Speaker 11: because in New York State, the Department of tax Station
Speaker 11: believes that really could have a buttered roll like anything,
Speaker 11: any piece of any kind of bread that has some
Speaker 11: at least some butter on it is a sandwich. And
Speaker 11: Bloomberg Pursuits says no to that.
Speaker 1: By the way, going to guess it regulator, Where was
Speaker 1: a kid? I thought that was a sandwich? Chris, come
Speaker 1: on in on this. Kate does such great stuff? Love this?
Speaker 1: What did you want to know about sandwiches?
Speaker 12: So we do this series periodically where Kate talks to
Speaker 12: top chefs in different locations, different cities, and she asks
Speaker 12: them what their favorite restaurants are, what their favorite pastries are,
Speaker 12: and she pitched doing the best Sandwiches in London a
Speaker 12: while ago, and it has been a long germinating story
Speaker 12: because there's a lot of sandwiches on this list. Agreed,
Speaker 12: and it actually we have to send people to take
Speaker 12: pictures of them, and it kept taking long time and
Speaker 12: kept being like, Kate, this is a high priority. We
Speaker 12: need to know the best sandwiches in London. And I'm
Speaker 12: just thrilled it came out because they look extremely delicious.
Speaker 1: I'm just going to tell you guys that I read
Speaker 1: this going home and it was like after eight I
Speaker 1: was starving and I'm like, oh my god, I just
Speaker 1: want them all. All right, So Kate tell us where we
Speaker 1: should start here.
Speaker 11: Well, the thing that's cool and why you guys should
Speaker 11: come to London and broadcast the show from here is
Speaker 11: that London really is sandwich central. And you know, people
Speaker 11: talk about a sad dust lunch all the time, but
Speaker 11: the sandwiches here at places like Predamanjay and even sort
Speaker 11: of supermarket chains like Mark and Spencer are really good
Speaker 11: and they are i have to say, better than like
Speaker 11: the average sandwich you would get in New York. And
Speaker 11: in fact, top chefs agree and we have we have
Speaker 11: a chef called Tamir Tnisia who picked a Tesco sandwich.
Speaker 11: Tesco is like a really like really supermarket chain, Like
Speaker 11: it's sort of like as all purpose as you can get.
Speaker 11: He picked a Coronation Chicken sandwich and it costs less
Speaker 11: than three three pounds, which is less than four bucks
Speaker 11: as his favorite sandwich, which I think is kind of fantastic.
Speaker 2: DDE.
Speaker 12: I wish you could see Tim's face as you were
Speaker 12: talking about how Tesco sandwich. You stand by this, right.
Speaker 12: You think these sandwiches, these like big chain sandwiches are legit.
Speaker 11: It's super legit, like super legit. Although I will say
Speaker 11: I'm not. I am not going to Tesco to buy
Speaker 11: my sandwiches. I mean I could afford to do. It.
Speaker 3: Is a pret sandwich in the UK different than a
Speaker 3: pret sandwich I get in New York City.
Speaker 11: Yes, I'm going to say yes it is. And it's
Speaker 11: better the bread like they just I think they care
Speaker 11: more about it and the quality of the bread is better.
Speaker 11: There is more filling, the ingredients feel like they're better sourced.
Speaker 11: So if you have a tun A Mao sandwich here,
Speaker 11: I will put it side to side against the one
Speaker 11: that you get in New York and you will know
Speaker 11: you will agree that it's better.
Speaker 1: Can I just go back to Coronation chickens. I didn't
Speaker 1: even know that there was a thing. This goes back
Speaker 1: to Queen.
Speaker 11: Oh yeah, do your Queen Elizabeth the second. If you
Speaker 11: do some research on that, you'll know it would served
Speaker 11: to her like at her coronation. It's a sort of
Speaker 11: creamy chicken curry that has become a favorite sandwich on
Speaker 11: afternoon teas and then also a tesco and believe it
Speaker 11: or not, a couple of people here because it's also
Speaker 11: in everyone's budget, went went and did a taste test.
Speaker 11: Since the story came out, I know three people here
Speaker 11: who have gone to get it and confirm that it's
Speaker 11: a good sandwich eating.
Speaker 3: I was so eating I would eat anything on her.
Speaker 3: But I will say it, I'm a little surprised to
Speaker 3: see some of the picks on here. I mean a
Speaker 3: poor boy, which is you know, traditionally a US like
Speaker 3: New Orleans type of thing. And then something from five
Speaker 3: guys like I agree.
Speaker 11: I was like you guys, I am on here over,
Speaker 11: I am all over that five guys recommendation, because if
Speaker 11: you read about it, if you think about it. What
Speaker 11: they do is they use an inside out bun. So
Speaker 11: they take a bun and they griddle it. They griddle
Speaker 11: it inside out and it's flattered with mayonnaise before it's griddled,
Speaker 11: and then they like melt cheese all over. It's melted
Speaker 11: American cheese, and then you can put all the toppings
Speaker 11: on it. So I know when I first saw when
Speaker 11: I first saw that pick, I was a little I
Speaker 11: thought that was sketchy. Doctors love it exactly, Oh zempic please.
Speaker 12: But you know, the things that were really I thought
Speaker 12: most fun for me on this list were places with
Speaker 12: really funny British names, like the Dusty Knuckle.
Speaker 11: That is an awesome also shown up on these on
Speaker 11: these roundups that we've done. It's also one of London's
Speaker 11: premiere bakeries, so it will be the first stop when
Speaker 11: you guys are here.
Speaker 12: My favorite was the honey truffle and Parmesan pork schabata
Speaker 12: from the Black Pig.
Speaker 1: I had it when I was there. My daughter and
Speaker 1: I shared it, sat on a curb, went over to
Speaker 1: Borough Market. I was it proud, unfreaking believable. It was yay,
Speaker 1: so good, so good, and the line, and they have
Speaker 1: such a system, right, Kate down, like they just you're
Speaker 1: in it, like you're just they just like manufacture it
Speaker 1: really quickly and it's yours, like it's just great.
Speaker 11: There's always a line, but the line does move quickly
Speaker 11: and so so yeah, oh my god, Carol fin Aspic.
Speaker 11: Another thing that's fun on this list I like a
Speaker 11: lot is this Jamaican patty and cocoa bread, which comes
Speaker 11: from this great chef Dom Taylor, who has a very
Speaker 11: hot restaurant in the Langham Hotel. It's called the Good
Speaker 11: Front Room. And so usually people will eat one of
Speaker 11: these Jamaican patties, which is stuff with grummeter chicken just
Speaker 11: by itself. But Dom Taylor, who comes from Jamaica, knows that,
Speaker 11: like the key move is to put it in cocoa
Speaker 11: bread and so and they do it at this place.
Speaker 11: And cocoa bread is a little bit it's got its
Speaker 11: name because it's flavored with coconut milk, so it's like
Speaker 11: puffy and pillowey and a little bit sweet and then
Speaker 11: you bite in two. I actually went to get one,
Speaker 11: and it's so good.
Speaker 12: I'm making Tim's Tesco face.
Speaker 10: Comes surfin Ter precisely.
Speaker 1: Well, icily, we're gonna all go run up to the
Speaker 1: food court after this and be like, where this average is.
Speaker 3: It's going to bring us some when.
Speaker 1: You come in April. We love you, We love you.
Speaker 1: This is such a great real hug. All right, be well,
Speaker 1: food editor pursuits you bet joining us from London? All right?
Speaker 1: I am certainly certainly hungry. But I also know that
Speaker 1: there's one story we really wanted to talk to you, Tim,
Speaker 1: and I've read it. Tell us about this Bill Pickett
Speaker 1: Invitational Rodeo that's been around for a while.
Speaker 12: Yes, it is the only It was founded in nineteen
Speaker 12: eighty four, the world's only touring black rodeo. And it
Speaker 12: was founded by an event promoter, this guy lou Vasson,
Speaker 12: who had gone to a couple of rodeos and saw
Speaker 12: basically that there were no black people in either the
Speaker 12: audience or on the horses, and so he was like,
Speaker 12: I'm going to change that, and he founded this and
Speaker 12: he passed away recently, and his wife, Valeria Howard Cunningham
Speaker 12: is now the president and it's really taking off. It's
Speaker 12: been sold out for the past two years. It's in
Speaker 12: twenty rodeos annually across seven states, and it's just this amazing, wild,
Speaker 12: fun rodeo for family kids all ages, as kids as
Speaker 12: young as six can ride and compete and win prizes,
Speaker 12: and it's just like a real cultural moment.
Speaker 3: What I find so interesting about this, Chris, is that
Speaker 3: as you and the team right and the piece, black
Speaker 3: cowboys were very prominent in the nineteenth century. Up to
Speaker 3: twenty five percent of nineteenth century cowboys were black. Yet
Speaker 3: here we are in this world where they've essentially been
Speaker 3: ignored by pop culture, and by the start of the story,
Speaker 3: people don't understand that part of the story.
Speaker 12: Yeah, it's been I mean it's basically been written out
Speaker 12: of Hollywood films, has been written out of popular literature,
Speaker 12: and some people, including Pharrell, are actually trying to bring
Speaker 12: this back to the forefront. So Pharrell is now the
Speaker 12: creative director at Louis Vuitton, and he went to the
Speaker 12: Bill Pikett Invitational and he saw one of the writers
Speaker 12: and he got him to come to Paris and walk
Speaker 12: in his first show, his first runway show for Louis Vuitton,
Speaker 12: Kamal Miller, who and this kid was like, wait, what
Speaker 12: you want me to do?
Speaker 3: What?
Speaker 12: And Farrell showed him how to walk, and yeah, it
Speaker 12: was just this crazy thing.
Speaker 1: And I like how they're kind of helping out a
Speaker 1: younger black generation too in this. I love the story
Speaker 1: and I agree with you. I feel like as we
Speaker 1: continue to realize the American history that we've known and loved,
Speaker 1: have realized how wrong a lot of it was, and
Speaker 1: so I thought that that fact, if you will, was
Speaker 1: pretty significant. This is our gift to Tim. We've got
Speaker 1: to do a little bit about skiing in Scandinavia.
Speaker 12: Yeah, Tim, have you been skiing in Scandinavia.
Speaker 3: I haven't been skiing in Scandinavia, but my understanding, I
Speaker 3: haven't even actually been skiing in Europe at all. Okay,
Speaker 3: and my understanding, I've been talking about this a lot
Speaker 3: actually with friends. Skiing in Europe is actually on a
Speaker 3: whole a lot cheaper than skiing in the United States.
Speaker 3: One challenge that they're dealing with, though, that we're also
Speaker 3: dealing with, is climate change and shorter ski seasons and
Speaker 3: a lack of snow. And it turns out people are
Speaker 3: going to Scandinavia because well, the snow exists there.
Speaker 12: Yeah, so right now, more than a quarter of ski
Speaker 12: resorts and the Alps are closed because the season's over.
Speaker 12: I can't believe that Austria had its shortest season every
Speaker 12: You remember last year there was like there were green
Speaker 12: slopes until January in Europe, and so more people are
Speaker 12: looking to go to Scandinavia. And because they're guaranteed longer winters,
Speaker 12: more snow, the terrain is not.
Speaker 3: As like craggy and it's surprised. That helps.
Speaker 12: That surprised me too.
Speaker 6: Yeah.
Speaker 3: You think, like you know, you're like near the North Pole,
Speaker 3: it's like super rugged, but it's not really the case.
Speaker 12: Yeah, the resorts actually tend to be more in like
Speaker 12: central North Pole. I mean that's at the top.
Speaker 2: Of the world.
Speaker 1: It also helps if you've got an airport nearby or
Speaker 1: you actually have to get you there, you hold a
Speaker 1: minority stake in that airport to get people there.
Speaker 12: Yeah, So we spoke to the owner of Stoton, which
Speaker 12: is a resort about six hours from Stockholm.
Speaker 3: Their past sales are.
Speaker 12: Up twenty two percent this year and that is in
Speaker 12: part because they recently opened an airport which has connecting
Speaker 12: flights from a lot of European cities, so it's a
Speaker 12: lot easier to get there and people are just considering
Speaker 12: it in a way that they hadn't before.
Speaker 3: I met Arctic Circle when I said, we lost it. Yeah,
Speaker 3: come back, come back, I'm back.
Speaker 1: We talk sandwiches again. Attention here, No, but it's really
Speaker 1: like amazing. I feel like you guys have been covering
Speaker 1: this just the changing because a climate change like it
Speaker 1: creates problems for some areas of the world and opportunities
Speaker 1: for others.
Speaker 11: Chris.
Speaker 12: Yeah, and there's a new resort opening for the twenty
Speaker 12: five slash twenty twenty six ski season, which you know
Speaker 12: they spent two billion corona on and it's part of
Speaker 12: a bigger network. Like people are really investing in this
Speaker 12: area as people in the Alps and other parts of
Speaker 12: Europe are kind of struggling to figure out what to do.
Speaker 3: The reason I said Arctic Circle is because some of
Speaker 3: these some of these series do sit north of the
Speaker 3: Arctic Circle. That's pretty cool. Yes, that's true.
Speaker 12: Yeah, and those ones are more mountainous, the ones that
Speaker 12: are further north with tougher train.
Speaker 1: All right, we got to rap guys. That's gonna do
Speaker 1: it for this edition of Pursuits.
Speaker 3: And that, of course is the editor of Pursuits, Chris
Speaker 3: Rowds are. Also a big thank you to Food editor
Speaker 3: of Pursuits Kate Craator, also joining us there on the
Speaker 3: Best Stand, which is from London.
Speaker 1: Carol, it really was good sandwich. I wanted to go
Speaker 1: back my doors, like now we're gonna go.
Speaker 3: Did you really split one?
Speaker 1: Though? Yeah?
Speaker 3: It was I would have gotten another one.
Speaker 1: You would liked it, You would like it.
Speaker 3: We'll be sure to tune into Bloomberg Business Week Monday
Speaker 3: through Friday starting at two pm all street time, on
Speaker 3: Bloomberg TV, Bloomberg Radio, and on Seris XM Channel one
Speaker 3: twenty one.
Speaker 1: You can also watch our daily broadcast on YouTube. Just
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Speaker 3: Find our Bloomberg BusinessWeek podcast at Bloomberg dot com, Apple,
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Speaker 3: the magazine also available on newstands now at Bloomberg dot
Speaker 3: com and always on the Bloomberg terminal. I'm Tim Steneveek
Speaker 3: and I'm Carol Masser.
Speaker 1: Have a good and safe weekend. Stay with us. Today's
Speaker 1: tap stories in global business headlines coming up right now.
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