Speaker 1: This is Bloomberg Business Week inside from the reporters and
Speaker 1: editors who bring you America's most trusted business magazine, plus
Speaker 1: global business finance and tech news As it happened. Bloomberg
Speaker 1: Business Week with Carol Messier and Bloomberg Quick Takes Tim
Speaker 1: Stinovic on Bloomberg Radio. Hi, everyone, welcome to the weekend
Speaker 1: edition of Bloomberg Business Week, the weekend holiday edition as
Speaker 1: the summer officially kicks off here in the US. That
Speaker 1: was quick, Yeah, thank god? All right, Tim. It's also
Speaker 1: a double issue of the magazine coming up. But look
Speaker 1: at the promise of bitcoin with the CEO of digital
Speaker 1: wallet company Ballet. Also an important and solemn week is
Speaker 1: we marked the one year anniversary of the death of
Speaker 1: George Floyd, the president and CEO of the National Urban League.
Speaker 1: On where we are today a really thoughtful conversation, plus
Speaker 1: Lords of London on billions of dollars of claims during
Speaker 1: the pandemic. All of that to come. We begin with
Speaker 1: this week's cover story, someone who is well known to
Speaker 1: our Bloomberg audience for her investment bets and her per formans.
Speaker 1: It's all about Kathy Would, who has become a star
Speaker 1: both in and outside of the world of e t s.
Speaker 1: They call her money Tree in South Korea and the
Speaker 1: Godmother in Hong Kong. Joining us now is Joel Weber,
Speaker 1: editor at Bloomberg business Week, and Ben Steveerman, personal Finance
Speaker 1: editor at Bloomberg News. Joel Uh. People may know about
Speaker 1: Kathy Would over the last year because she has become
Speaker 1: this celebrity inside and outside of finance, but she got
Speaker 1: started at ARC relatively late in her career and she's
Speaker 1: been at this for years. Yeah, And what we really
Speaker 1: tried to do, I think we talked about Kathy Would
Speaker 1: almost every day in general at Bloomberg News because it's
Speaker 1: become just one of the most remarkable stories of the
Speaker 1: past year. Um. But we what we tried to do
Speaker 1: and what Ben in Um, Claire Valentine and any Massa
Speaker 1: did with this cover story was really tried to tell
Speaker 1: a bigger story about who Kathy Wood is, where she
Speaker 1: can came from, how she's up ended investing and and
Speaker 1: maybe pull you know, pull some things that out that
Speaker 1: nobody you had ever really known about her, and they
Speaker 1: did that, and you know, it's really rooted in her
Speaker 1: I think having a really deep understanding of the financial industry.
Speaker 1: Before she started arc Um, she she had an active
Speaker 1: the idea of doing an actively managed g T F
Speaker 1: at um Alliance Bernstein, which basically said, we don't want
Speaker 1: you to do that, and she went out and did
Speaker 1: it anyway, and that's made her basically one of the
Speaker 1: biggest names in in finance at the moment um And Ben,
Speaker 1: as you just started to you know, working on this story,
Speaker 1: what what stuck out to you? What makes Cathy different
Speaker 1: and special? So I think that you know, in the
Speaker 1: last year, the pandemic has created um a lot of frenzies.
Speaker 1: Like we've seen a lot of frenzies in the stock market,
Speaker 1: and we've seen a lot of people promoting themselves and
Speaker 1: promoting their SPACs, and we've seen a lot of that
Speaker 1: phenomenon of almost celebrity culture coming into finance and investing.
Speaker 1: And so I approach Cathy would as maybe part of that.
Speaker 1: But now, you know, the more I looked at her,
Speaker 1: the more I realized that she's actually been this same
Speaker 1: person for for for decades, Like she is obsessed with
Speaker 1: innovation and the future and and what she was saying,
Speaker 1: you know, five years before the pandemic is the same
Speaker 1: thing she's saying now more or less, maybe the timeline
Speaker 1: has accelerated a bit in terms of the the changes
Speaker 1: she sees in the economy and the stock market. But um,
Speaker 1: I really think that um investing in these these future
Speaker 1: technologies is more is almost more about her her like
Speaker 1: philosophy of life than it is about making money. I mean,
Speaker 1: of course she's in it to make money, but I
Speaker 1: think she has broader goals in mind. Well then to
Speaker 1: that point, and among the many, many new things that
Speaker 1: I learned about Cathy would in this cover story about
Speaker 1: you and Claire and Annie has has been that she
Speaker 1: talked about that She had this rarely prescient comment back
Speaker 1: in February of twenty nineteen when she told a podcast,
Speaker 1: it's the the best thing that can happen for us.
Speaker 1: And this is going to sound odd. Is a crisis,
Speaker 1: It's usually when innovation takes root and gains traction. So so,
Speaker 1: how did that play out during the pandemic? How did
Speaker 1: this five year time arise and that she talks about
Speaker 1: so much, Trunk had accelerate, Yeah, I mean, she it's
Speaker 1: incredible if you look at the numbers on her flagship
Speaker 1: et F. I mean we're talking about a hundred fifty return.
Speaker 1: She was right on she she she she captured the
Speaker 1: mood of the market in that moment, and then it
Speaker 1: continued to go up all the way into February. Now
Speaker 1: since then, um, she's lost about a third of the
Speaker 1: value in in her fund because you know, as the
Speaker 1: economy has reopened, the market has been shifting towards a
Speaker 1: little bit more boring stocks of the broader the rally
Speaker 1: is broadened out. And she says that's actually good for
Speaker 1: her because it means that means that this is actually
Speaker 1: a sustainable bull market. And she's keeps selling her investors
Speaker 1: who's mostly stuck with their that um that she has
Speaker 1: a five year time horizon and she still expects her
Speaker 1: portfolio to triple over those five years. Funny if people
Speaker 1: don't believe that, I gotta say um. And so we
Speaker 1: try to reflect the debate in the story about you know,
Speaker 1: is she right, is she wrong? Um? You know, is
Speaker 1: this a real grounded opinion or or is she just
Speaker 1: really hoping against hope? But um, but she's she seems
Speaker 1: pretty unruffled by what's happened recently. That was Bloomberg News
Speaker 1: reporter Ben Steve Berman and Business Week editor Joel Weber
Speaker 1: Coming up. It's been just over a years since George
Speaker 1: Floyd's murder sparked outrage across the globe and became a
Speaker 1: turning point in the movement to end racially motivated police violence.
Speaker 1: National or Been League President and CEO Mark Morial on
Speaker 1: the progress we've made sense and how far there's still
Speaker 1: to go. You're listening to Bloomberg Business Week. This is Bloomberg.
Speaker 1: This is Bloomberg Business Week with Carol Massier and Bloomberg
Speaker 1: Quick Takes Tim Stinovik from Bloomberg Radio. Nine minutes, twenty
Speaker 1: nine seconds. That's how long it took for George Floyd
Speaker 1: to lose his life one year ago this week, at
Speaker 1: the hands of a white Minneapolis police officer, Derek Chauvin.
Speaker 1: Now the revelation of that loss of life seen by
Speaker 1: the world, so many of us stuck at home because
Speaker 1: of the pandemic. It ignited rage, set off protests and
Speaker 1: soul searching not seen in years. The problems not new,
Speaker 1: change and solutions still a work in progress. For more
Speaker 1: on where we are, what we've learned one year later,
Speaker 1: and how much more we have to go. Carol, you
Speaker 1: caught up with National Urban League President CEO Mark Morial,
Speaker 1: along with Bloomberg News New York Deputy Bureau Chief Shartilla Brantley,
Speaker 1: on the one year anniversary of the death of George Floyd.
Speaker 1: It's all about action now. Last year, you know, there
Speaker 1: was a lot of talk, a lot of pledges, a
Speaker 1: lot of commitments, and that's a good thing. But I
Speaker 1: think as we've seen work from home advance by leaps
Speaker 1: and bounds, people want to see equity and equality advanced
Speaker 1: by leaps and bounds. And I think people are done
Speaker 1: with the incremental, you know, progress, the glacial pace of progress.
Speaker 1: And you know, I'll give it to our gen z,
Speaker 1: the Zoomers. They're over it. They want it yesterday, right
Speaker 1: tomorrow exactly and safe to say after, you know, when
Speaker 1: after George Floyd, like we just talked about, We've had
Speaker 1: so many conversations. Let's see the action. Mark. The problem
Speaker 1: is not new. Where are we today, what have we learned?
Speaker 1: And how much more do we have to go? In
Speaker 1: your view, I think we should keep in mind that
Speaker 1: the courage of Darnella Frasier, a teenage girl who had
Speaker 1: the presence of mind to pull out our iPhone and tape.
Speaker 1: What was happening to George Floyd is the reason we
Speaker 1: are here today. UH. If but for what she did,
Speaker 1: this would have been subject to what so many of
Speaker 1: these police UH incidents UH involved in. That is UH
Speaker 1: fictitious stories, misrepresentations, and lying about what has happened. We
Speaker 1: see it in the Ronald Green case in Louisiana, where
Speaker 1: the officers said that Ronald Green died from a quote
Speaker 1: automobile accident, Yet when the tape comes out, it's clear
Speaker 1: that they beat him to death for no reason. So
Speaker 1: I want everyone to remember that it was the wake
Speaker 1: of the presence of mind, and that we need people
Speaker 1: and citizens to have the presence of mind to capture
Speaker 1: incidents of injustice. Having said that, I think that the
Speaker 1: George Floyd moment is a moment that accelerated this new
Speaker 1: movement for social justice, for black lives, mattering, for civil
Speaker 1: rights and economic opportunity in this country in a very
Speaker 1: special way. We're at the beginning of the beginning of
Speaker 1: of of a movement, and it is my my hope
Speaker 1: and it's my prayer that this moment of injustice has
Speaker 1: spurred a movement that will last until the work of
Speaker 1: the movement is done because of the way in which
Speaker 1: this movement affected people. The George Ford incident captured the
Speaker 1: imagination because of the outrage of people not only here
Speaker 1: in the United States from all walks of life and backgrounds,
Speaker 1: but also from people all over the world. Having said
Speaker 1: that the test is going to be whether commitments and
Speaker 1: whether this movement, this protest movement, is going to turn
Speaker 1: into meaningful action. One thing that is so critical is
Speaker 1: the passage of the George Ford Justice and Policing Act,
Speaker 1: which right now is the subject subject of sensitive negotiations.
Speaker 1: But those negotiations are simply because there's were councilors in
Speaker 1: the United States Senate by some to pass a meaningful,
Speaker 1: substantial police reimagination and reform bill, which is what the
Speaker 1: George Floyd Bill is. Mark, are you confident the George
Speaker 1: Floyd Justice and Policing Act will be passed by Congress.
Speaker 1: I'm I'm going to remain optimistic, but I'm realistic. I
Speaker 1: understand the nature of the opposition. And then what is
Speaker 1: the nature of the opposition. You have certain elements on
Speaker 1: the Republican side, certain elements who do not want to
Speaker 1: look at the bill on its merit, who simply want
Speaker 1: to see it as just another battle in the partisan
Speaker 1: wars that were involved in would suggest, well, we can't
Speaker 1: give Joe Biden the Democrats of victory. Notwithstanding the fact
Speaker 1: that the George Floyd Bill and it's enumerated provisions, whether
Speaker 1: it's banning show calls, whether it's giving people access to
Speaker 1: the courts in a meaningful way by dialing back qualified immunity,
Speaker 1: whether it's creating a stronger if you will excess, if
Speaker 1: you supporce criminal statute, and and I could continue to
Speaker 1: talk about provisions. Those provisions are supported by the American people.
Speaker 1: Poll after poll demonstrates that. And notwithstanding that this bill,
Speaker 1: now passed by the Congress of the United States, the
Speaker 1: House of Representatives twice, this bill, now with the full
Speaker 1: support of the President and the Vice President, is still
Speaker 1: subject to difficult negotiations because of this antiquated old school
Speaker 1: rule called the Senate filibuster. Are you disappointed in them
Speaker 1: for not taking a firmer stance. There's a lot of
Speaker 1: I feel like doctrines put out a lot of words said,
Speaker 1: But do you feel like the corporate community has really
Speaker 1: stood up uh and really come out like they should have?
Speaker 1: UM After George Floyd. So the corporate community is not
Speaker 1: a monolith. It's not a unified group. Uh. There are
Speaker 1: many who UH spoke out forcefully, who have made meaningful
Speaker 1: and substantial commitments. There are some which put out perfunctory statements,
Speaker 1: and there's some that have done nothing. I believe that
Speaker 1: those that have, and I would point to, uh the
Speaker 1: actions of the Business Roundtable as being you know, fairly
Speaker 1: significant to the extent that these commitments are lived up
Speaker 1: to and follow through on. It's gonna take three to
Speaker 1: five years to make those kinds of determinations. But let's
Speaker 1: look at the corporate community and not look at it
Speaker 1: as a monolitht because I don't think it is a
Speaker 1: monolist and I think there's a great deal of conviction
Speaker 1: and sincerity among many. But the question is always whether
Speaker 1: it's a moment of response, whether it's a complete shift.
Speaker 1: I can tell you that many of the discussions I've
Speaker 1: had even in this week have been about how to
Speaker 1: increase pipelines and talent coming in from the black community,
Speaker 1: how to create a corporate atmosphere which is fairer and
Speaker 1: more equitable and free of racism. Those discussions, and I
Speaker 1: sense in many of those discussions, a degree of since
Speaker 1: therety a degree of commitment, but the pressure, the movement
Speaker 1: in the community, uh, the conversation that has taken place,
Speaker 1: the attention of people like you and the media has
Speaker 1: to continue. Don't let this die, don't let this go away.
Speaker 1: That was Mark Morial, the president of the National Urban
Speaker 1: League and Bloomberg's deputy New York Bureau Chief Shartilla Brantley,
Speaker 1: incredible with the last year has brought us and not
Speaker 1: even thinking about the pandemic, Carolin, look hard to believe
Speaker 1: it's been a year, no exactly. And what's interesting and
Speaker 1: I'm hearing this over and over and this certainly came
Speaker 1: out in our conversation. It's all about we have to
Speaker 1: now stop only talking about it, but actually doing something
Speaker 1: about need to see the data from these organizations, from
Speaker 1: these businesses, show us that you're making a difference. Exactly.
Speaker 1: Let's see the change all right still ahead on Bloomberg
Speaker 1: Business Week, businesses are rethinking the way they protect themselves
Speaker 1: from unforeseen disasters, and the insurance industry taking notice and
Speaker 1: inside look at one of the biggest claims handlers in
Speaker 1: the world and the hundreds of billions of dollars at stake.
Speaker 1: This is Bloomberg Broadcasting from the financial capital of the world,
Speaker 1: Bloomberg eleven in Rio in New York to Washington, d C.
Speaker 1: Bloomberg to Boston, Bloomberg one oh six one does San Francisco,
Speaker 1: Bloomberg nine sixty to the country Sirius XM Chado one
Speaker 1: nine team and around the globe the Bloomberg Business app
Speaker 1: and Bloomberg Radio dot Com. This is Bloomberg Business Week. Well,
Speaker 1: the health pandemic was one of those unforeseen events that
Speaker 1: impacted us in ways we couldn't have imagined him. We
Speaker 1: all know that, and yet there we were, the global
Speaker 1: economy shut down and businesses tapping their insurers as a result.
Speaker 1: Lloyd's of London is the largest market for insurance and reinsurance,
Speaker 1: with a bulk of their business in the insuring of events.
Speaker 1: Hank Watkins is president of the America's Region of Lloyd's
Speaker 1: of London and joined us to talk about the impact.
Speaker 1: You know, it's certainly been a tragedy globally in in
Speaker 1: many countries were far from seeing a conclusion to this,
Speaker 1: this pandemic. But you know, for the insurance industry, which
Speaker 1: is I think the focus of the conversation today. We've
Speaker 1: gotten through it pretty well. We were initially looking at
Speaker 1: at well over a hundred billion dollars in claims globally,
Speaker 1: as well as a similar diminution of asset values. The
Speaker 1: asset values were not hit as hard, but but there
Speaker 1: still will when this is all said and done, be
Speaker 1: more than a hundred billion dollars in claims paid by
Speaker 1: the global insurance and reinsurance industry. You think of the
Speaker 1: events that were canceled or postponed, Wimbledon, the Olympics, all
Speaker 1: around the world, just as major events there so, but
Speaker 1: but you know, not to say there was a positive
Speaker 1: outcome of this, but it forced our industry, which has
Speaker 1: historically been fairly slow to digitize, to use the benefit
Speaker 1: of electronic UH distribution, to really get on board with
Speaker 1: that across the industry flowing jump. No, no, no, forgive me.
Speaker 1: But you know what is digitization in your industry? Like,
Speaker 1: we get it when it comes to retail, right, everybody
Speaker 1: going on platforms and and shopping. I get that. So
Speaker 1: what is exactly digitization or the digital component that you
Speaker 1: guys had to ramp up as a result of the pandemic. Well,
Speaker 1: you look at it from the banking perspective. You know,
Speaker 1: it's clearly it's it's converting um data into numerical figures
Speaker 1: that you can more readily use across an entire platform.
Speaker 1: In the insurance industry, there is a certain element, the
Speaker 1: insured text side that has done a great job out
Speaker 1: over the past several years, mostly in the personalized and
Speaker 1: small commercial space, but at a large more complex risk
Speaker 1: space which Lloyd's plays in. We still, prior to the
Speaker 1: pandemic did a lot of our business face to face.
Speaker 1: There was a fair amount of paper involved between submissions
Speaker 1: and policies and all that. But as of April, we
Speaker 1: and a lot of our competitors pivoted very quickly towards
Speaker 1: electronic transactions. You know, everything was done via via email,
Speaker 1: policies issued issue digitally, etcetera. So we we've come a
Speaker 1: long way, but we might have gotten there absent a
Speaker 1: pandemic in five years. But again, like I said, one
Speaker 1: of the outcomes that has been through the industry and
Speaker 1: Lloyds is that we've moved a lot more quickly. You
Speaker 1: mentioned that when all of a sudden done, it will
Speaker 1: be about a hundred billion dollars in claims paid out. Um.
Speaker 1: You talked about the US Open, something that we typically
Speaker 1: go to, and of course that was shut down. It's
Speaker 1: a huge event, Wimbledon, so many different sporting events. What
Speaker 1: was the biggest claim component if there's a pie in
Speaker 1: terms of claims being paid out, was it sports and events?
Speaker 1: What was it the biggest component that was ultimately paid
Speaker 1: out because of the pandemic? Carol, I'll speak from from
Speaker 1: Lloyd's perspective only, since we do ensure a lot of
Speaker 1: events globally. Event cancelation was probably globally of our The
Speaker 1: impact on us, oh absolutely yes. Well has it then
Speaker 1: changed as hanked? As it change your thinking in terms
Speaker 1: of policies going forward? I mean, who would have thunk
Speaker 1: right a pandemic? It's like one of those black Swan events,
Speaker 1: it feels like. But does it change you're thinking about
Speaker 1: policy coverage or clients? Are they changing their thinking about
Speaker 1: what kind of insurance I have? God forbid we get
Speaker 1: another pandemic? There were there were actually UH products available
Speaker 1: UM for several years, So I mean Lloyd's issued a
Speaker 1: paper about ten years ago UH exploring the risk of
Speaker 1: a major pandemic, and it was issued and read by
Speaker 1: some people. I suppose. But then ultimately there were some
Speaker 1: policies put out there in the marketplace by a few
Speaker 1: major firms, and and there was no take up because people,
Speaker 1: especially you know, post financial crisis, people are struggling to
Speaker 1: get back in their feet. Businesses aren't thinking about every
Speaker 1: possible systemic issue out there. They need to cover what
Speaker 1: it takes to to run their business. So that's the
Speaker 1: way human nature is, though, right We've we spend money
Speaker 1: on ensuring our cell phones, yet we don't necessarily take
Speaker 1: care of our lives or other things as we might. So, Hank,
Speaker 1: you mentioned that you guys, you ensure a lot of events.
Speaker 1: What's your expectation for the next year or so, because
Speaker 1: the world is definitely reopening. But I am curious if
Speaker 1: a lot of events or those who put on the
Speaker 1: events are either upping their insurance coverage. I'm just curious
Speaker 1: what was the impact as a result of the pandemic, Carol.
Speaker 1: The impact has been buying a bridge significant limits of
Speaker 1: liability for a major event that could be impacted by
Speaker 1: another way or by a new pandemic, for example, is
Speaker 1: very difficult. But we have found a number of new
Speaker 1: insurance providers coming on scene. They don't have any legacy losses.
Speaker 1: They didn't pay for the losses last year, so they
Speaker 1: have an opportunity now with new capital to go out there.
Speaker 1: We underwrite the exposure and potentially provide solutions to some
Speaker 1: of these major event organizers around the world. That's Hank Watkins.
Speaker 1: He is president of the America's Region of Lloyd's of London.
Speaker 1: You know, a really insightful conversation in an area of
Speaker 1: the business world we sometimes overlook, kind of just take
Speaker 1: for granted, tim but it's a critical piece of the
Speaker 1: financial support for so many and really of our financial industry.
Speaker 1: You're listening to Bloomberg Business Week. Up next, movie theater
Speaker 1: operators are stepping up efforts to draw people back into
Speaker 1: their buildings as the pandemic eases here in the US,
Speaker 1: and recent box office returns in Asia are providing reasons
Speaker 1: for optimism. Yep, we're watching Asia for cues of what
Speaker 1: happens in the rest of the world. I'm actually a
Speaker 1: Rich Galfon on why the pandemic can't crush people's love
Speaker 1: of the silver screen experience. This is Woomberg. You're listening
Speaker 1: to Bloomberg Business Week with Carol Messer and Bloomberg Quick
Speaker 1: takes Tim Stinovik from Bloomberg Radio. The ninth installment of
Speaker 1: the widely popular, successful Fast and Furious movie franchise, It
Speaker 1: is rolling out. You might recall last week at the
Speaker 1: Bloomberg Live virtual event the Bloomberg Business Week, we caught
Speaker 1: up with Jason Lynn. He Tim is the director behind
Speaker 1: it all. Fast nine. F nine is really the first
Speaker 1: film of the final chapter, so it was actually it's
Speaker 1: actually been very liberating. It's a very different process. So
Speaker 1: ten is not necessarily the last one. It sounds like
Speaker 1: it most definitely is not the last one. I would
Speaker 1: say the last chapter. I think, you know, we have
Speaker 1: so many characters that my problem is actually real estate,
Speaker 1: you know, and so to know that, hey, you know,
Speaker 1: we have F nine, but I also now have real
Speaker 1: estate for two more movies. To be able to tell
Speaker 1: this last chapter hasn't like really again, it's very kind
Speaker 1: of for me. It's a very fresh way of of,
Speaker 1: you know, really kind of crafting what we're gonna do.
Speaker 1: It opened internationally, with most of the ticket sales happening
Speaker 1: in the biggest movie market in the world, China. Richard
Speaker 1: Gelfond is CEO of the movie theater company Imax, and
Speaker 1: had more on the reopening of the big screen. You know,
Speaker 1: it's it's been a long cold winter, as you guys
Speaker 1: are quite aware, and it's nice to have the good
Speaker 1: old fashioned Hollywood blockbuster back. And I think F nine
Speaker 1: really opened up like a Hollywood blockbuster. It did hundred
Speaker 1: sixty five million dollars globally, hundred thirty five million dollars
Speaker 1: in China. IMAX's market share was very healthy. It's our
Speaker 1: biggest opening um and you know since before the pandemic started,
Speaker 1: so feeling a lot better than it was a few
Speaker 1: weeks ago. Carol, Well, that's a big change. Yeah, how
Speaker 1: I mean, how were you feeling a few weeks ago?
Speaker 1: And what changed that? Was it? This opening weekend? Especially globally,
Speaker 1: you know, probably be more us than I should be.
Speaker 1: This has been one of the most frustrating periods of
Speaker 1: the pandemic for me, and that's because I think the
Speaker 1: world is really ready to go back to the movies,
Speaker 1: and I think there are a lot of movies that
Speaker 1: are ready to go, but I think not every territory
Speaker 1: in the world is ready at the same time and
Speaker 1: the same pace, and the traditional distribution model would say,
Speaker 1: you open up globally at one time all over the world,
Speaker 1: but you know, guess what, this just isn't the time
Speaker 1: without works, so that this time is called for different
Speaker 1: kinds of models. And as a result, um, the studios
Speaker 1: who mostly wire located in Hollywood, we're looking out their
Speaker 1: windows and saying, the pandemic is really not doing well here,
Speaker 1: ignoring the fact that you know, they've been blockbusters in
Speaker 1: Japan and China and Korea and Taiwan for months. So
Speaker 1: I think kind of we've been ready in a lot
Speaker 1: of places, but the movies just haven't been there. And
Speaker 1: one of the things that was really unique about the
Speaker 1: release of F nine was it was released in China
Speaker 1: about five weeks before it's being released in the rest
Speaker 1: of the world, which is a different model. And I
Speaker 1: think most of the studios have played it really conservative
Speaker 1: and said we're not opening anywhere until we could open everywhere. Um.
Speaker 1: But fortunately Universal, you know, took the risk in doing
Speaker 1: this and it opens in the US in late June.
Speaker 1: But it really worked. And I think you need to
Speaker 1: demonstrate that people want to go back to the movies,
Speaker 1: and you need the kind of numbers that we had
Speaker 1: in order to get people a studio is comfortable opening
Speaker 1: in their movies, So I think this was a pretty
Speaker 1: big deal. Yeah. Well, what's interesting is I remember you
Speaker 1: saying to when you and I talked at that Bloomberg
Speaker 1: Live event. I think it was back in April. You
Speaker 1: know how you guys went into COVID earlier because of
Speaker 1: China and then came out of it earlier too because
Speaker 1: of China, and how China in many ways has been
Speaker 1: a guiding light about kind of where we're going and
Speaker 1: how the world is reopening. Not apples to apples, I
Speaker 1: understand that, but it has helped us give us a
Speaker 1: little bit of kind of the way forward in terms
Speaker 1: of how the world maybe reopens. Yeah, I think that's
Speaker 1: definitely the case. I think the big distinguished thing thing
Speaker 1: between China and other places though, is China didn't vaccinate
Speaker 1: at the level that other places did and mostly achieved
Speaker 1: it's kind of feeling of safety and low results through
Speaker 1: social contact tracing and other means that we're not used
Speaker 1: here in the West. So in a way, as good
Speaker 1: as China has been, um places like North America could
Speaker 1: be even better once it really opens up. Because I
Speaker 1: imagine you guys noticed that the Nick Game the other night,
Speaker 1: there were fifteen thousand people, um, you know, having a
Speaker 1: great time. And I really feel that it's going to
Speaker 1: be like the Roaring twenties and people but once they
Speaker 1: get out of the house and you know, they can
Speaker 1: go back to what their lives were like before. I
Speaker 1: think that's going to happen very quickly. And I think
Speaker 1: you know it. As I said, it's happening in Asia,
Speaker 1: and there's no reason I think that that won't happen here. Well,
Speaker 1: I'm wondering about that specifically here in the US, because
Speaker 1: we have seen companies like Disney and Warner Media as
Speaker 1: it has is still called release theatrical releases direct to
Speaker 1: streaming direct consumer And I'm wondering if you think that
Speaker 1: consumers have been conditioned to enjoy this stuff at home
Speaker 1: rather than in a theater, and that might not provide
Speaker 1: the incentive for them to get back to what they
Speaker 1: were doing before the pandemic, because now they've been able
Speaker 1: to do it from their couch and not get a babysitter. Yeah.
Speaker 1: I mean, that's a narrative that I think a lot
Speaker 1: of the streaming services are promoting. But I don't really
Speaker 1: think it's going to play out that way. I mean,
Speaker 1: people are locked in their living rooms, were locked in
Speaker 1: their kitchens. So when you're locked in your living room,
Speaker 1: you watch movies on your television set. When you locked
Speaker 1: in your kitchen, you don't go to restaurants. You eat
Speaker 1: in your kitchen when you're allowed to go out. I
Speaker 1: mean you look at almost every behavior. Look at what's
Speaker 1: gone on with the restaurants in New York and London
Speaker 1: and Los Angeles. I mean people were in condition the
Speaker 1: only bringing in food. They were limited by the circumstances
Speaker 1: to doing that. And you even look at um um
Speaker 1: one of the recent films, got Zilla Versus Kang that
Speaker 1: was released simultaneously by Warner Media um in imax. We
Speaker 1: sold out about a thousand shows around the United States
Speaker 1: when people could get it for free if they were
Speaker 1: subscribers on their TV sets. So I just don't think
Speaker 1: that's the way it is. I mean, people go to
Speaker 1: the movies partly for escapism, partly for social reasons, partly
Speaker 1: for social activity, probably to get away from their kids,
Speaker 1: probably to get away from their parents. You know, everyone
Speaker 1: has a different reason. But I don't think they're gonna say, oh,
Speaker 1: i'd much rather watch this in my living room with
Speaker 1: my family, which is what I've been doing for the
Speaker 1: last fifteen months. It was an interim solution designed for pandemic.
Speaker 1: And I don't blame anybody. I mean, if you're Disney,
Speaker 1: your warner, you know, the movie theaters are closed, You've
Speaker 1: got this content you paid for, You've got to do
Speaker 1: something with it. And by the way, streaming happens to
Speaker 1: be something that the stock market likes an awful lot.
Speaker 1: So you say, oh, I'll stream, but they know that
Speaker 1: that's that's made for a time and a place. And again,
Speaker 1: I don't want to make too much of it. But
Speaker 1: if you look at the recent results and the and
Speaker 1: the projections from the streaming services during the last quarter,
Speaker 1: as the pandemic has started to fade, you know, the
Speaker 1: numbers for streaming of you know, not kept pace with
Speaker 1: where they were in the pandemic. And again that's logical.
Speaker 1: And people are still going to stream certain things, but
Speaker 1: for big blockbuster movies like IMAX does no one's going
Speaker 1: to look forward to spending Saturday night on the couch
Speaker 1: with my parents rich To be fair, just like you're saying,
Speaker 1: the narrative of the streaming guys, they're kind of talking
Speaker 1: their book to some extent, I think it's safe to
Speaker 1: say that you're talking your book about people coming back.
Speaker 1: But I mean, what do you then make of all
Speaker 1: the streaming deals that are happening right now. Where you've
Speaker 1: worked in mergers and acquisitions, you're an investment, but you
Speaker 1: understand this world. Do you think this is just a
Speaker 1: cycle that runs out of steam or do you think
Speaker 1: there's real momentum Because there's some things that changes, but
Speaker 1: as a result of the pandemic that will stay with us.
Speaker 1: And I think there's a lot that would say that
Speaker 1: streaming is part of that. I think streaming is part
Speaker 1: of it, but I think in a different way than
Speaker 1: it was during the pandemic. I think for niche movies
Speaker 1: and movies that you know, cost less in a budget
Speaker 1: and have to find a specific audience, releasing them direct
Speaker 1: to streaming will make sense because the marketing costs are
Speaker 1: extremely high to do that reaching your consumer and a
Speaker 1: niche market is difficult to find. And I think those
Speaker 1: things will continue to stream. Also, almost every studio has
Speaker 1: come up now with a forty five day window where
Speaker 1: they'll they'll stream forty five days after opening and I think,
Speaker 1: if anything, that's going to make the content more valuable
Speaker 1: and the theatrical run more valuable to the studio. Because remember,
Speaker 1: how did HBO get started? How did um, um, how
Speaker 1: did Netflix get started? They streamed Hollywood movies and those
Speaker 1: movies got a lot of exposure, got a brand, got
Speaker 1: good word of mouth. I've got brand recognition, built sequels,
Speaker 1: and then people paid a lot to go stream them. Um.
Speaker 1: You know. As I'll ask you a question, nay, five
Speaker 1: stream movies from Netflix last year? Um you know. And
Speaker 1: by the way, it is a trick question because I
Speaker 1: was just in l A and I asked ten people
Speaker 1: that and nobody can name five stream movies during And
Speaker 1: that's streaming. When I was growing up, there were TV
Speaker 1: movies and then there were real movies. I think now
Speaker 1: there's gonna be real movies and streaming movies. That's I'm
Speaker 1: x CEO Rich Galfon. And to be fair, Tim, you know,
Speaker 1: he's kind of talking his book a little bit. He's
Speaker 1: all about the big screen and big blockbuster movies, but
Speaker 1: he does say that there's going to be movies that
Speaker 1: you're gonna want to see on the big screen, and
Speaker 1: then there stuff you'll be like, Okay, I can watch
Speaker 1: that at home, right, Look, you can't exactly replicate the
Speaker 1: IMAX experience at home, at least, you know, most people
Speaker 1: don't have an IMAX screen at their house now, I
Speaker 1: don't yet. Uh, And I kind of like the popcorn
Speaker 1: in the theater too. That raps up the first hour
Speaker 1: of the weekend edition of Bloomberg Business Week from Bloomberg Radio.
Speaker 1: I'm Carol Masse and I'm Tim Stanavak. Ahead in our
Speaker 1: next hour, a trio of executives on the frontiers of
Speaker 1: their respective industries. App Harvest CEO Jonathan Webb on artificial
Speaker 1: intelligence and Agriculture Bonnie CEO Peter McGinnis on his company's
Speaker 1: latest innovations. And Ballet CEO Bobby Lee on the promise
Speaker 1: of bitcoin. I see what he did there. It's a
Speaker 1: little bit of innovation, right, people kind of disrupting the world.
Speaker 1: Coming up next, though, if you've been searching for the
Speaker 1: fountain of youth, who is not doing that? Everybody is? Well?
Speaker 1: Silicon Valley may have founded and it might be in
Speaker 1: your dog Man's best friend. Why canine life extension research
Speaker 1: could lead to breakthroughs for the rest of us? I'm
Speaker 1: hoping my scout's going to help me out here. All
Speaker 1: this is Bloomberg. This is Bloomberg Business Week inside from
Speaker 1: the reporters and editors who bring you America's most trusted
Speaker 1: business magazine, plus global business finance and tech news As
Speaker 1: it happened, Sloomberg Business Week with Carol Messer and Bloomberg
Speaker 1: Quick Takes Tim Stinovic on Bloomberg Radio. Hi, I'm Carol
Speaker 1: Masser and I'm Tim Stinovic. Plenty ahead in our second
Speaker 1: hour of the weekend edition of Bloomberg Business Week, including
Speaker 1: Tim Dogs in the Fountain of Youth, Crypto also from
Speaker 1: a veteran and another yogurt I p O Chobani anyone,
Speaker 1: and Farming with Ai with the founder and CEO of
Speaker 1: app Harvest. Looking forward to all of that. First up, though,
Speaker 1: this our story we both loved. We were talking about
Speaker 1: it throughout the day. We thought it was about one
Speaker 1: thing initially, and once we started reading through it realized
Speaker 1: it was about something else. Cut to the chase him,
Speaker 1: It's about man's best friend and how our pups may
Speaker 1: help us stay forever young. By way of Silicon Valley.
Speaker 1: We got the details from Bloomberg Business Week feature writer
Speaker 1: and New York Times bestselling author Ashley Vance, who's also
Speaker 1: the host of Hello World and author of Elon Musk, Tesla, SpaceX,
Speaker 1: and The Quest for a Fantastic Feature. He was joined
Speaker 1: by Bloomberg Business Week editor Joel Weber so UM in
Speaker 1: Silicon Valley UM life extending technologies are of great interests,
Speaker 1: and there's been a lot of of interest in what
Speaker 1: can be done on a cellular level to basically eke
Speaker 1: out a few more dozen years. The problem is, like
Speaker 1: testing on humans is actually really difficult because it takes
Speaker 1: a long time to get there. UM. And that kind
Speaker 1: of brings us to this story that actually got which was,
Speaker 1: you know, there's a buddy in some of our lives
Speaker 1: that we could maybe do some testing on. So so, Ashley,
Speaker 1: what did you what did you find? As UM as
Speaker 1: you dug into this a little bit, Yeah, well, so
Speaker 1: there's this company called Loyal and they're they're based in
Speaker 1: San Francisco, And you've got it exactly right. You know,
Speaker 1: there's there's at least five or six or seven promising
Speaker 1: compounds that are out there, things that the doctors and
Speaker 1: scientists have known about for years that we see seems
Speaker 1: to extend life and mice and to get rid of
Speaker 1: inflammation and things like that. But nobody's been willing to
Speaker 1: fund a human trial because you've basically got to do
Speaker 1: it for forty for fifty years. And so this company,
Speaker 1: Loyal is now going to test these compounds on dogs,
Speaker 1: and you know, they think they can run these studies
Speaker 1: in two, three, four years and see if it works
Speaker 1: and and then you know, the goal is is if
Speaker 1: this seems like I's working on dogs, maybe people will
Speaker 1: be more willing to do some of these tests on
Speaker 1: humans are just to go ahead and green like the drugs.
Speaker 1: So how likely is this? Because as I kidded in
Speaker 1: the top, you know, we've been on this pursuit of
Speaker 1: the Fountain of youth forever. So how likely is there
Speaker 1: something out there that you know helps out my dog Scout?
Speaker 1: I'd love to have her forever, but also I'd like
Speaker 1: to live a little bit longer. Well, it's funny because
Speaker 1: when I went into this, I was skeptical, and you
Speaker 1: would imagine, but um, you know, I interviewed a member
Speaker 1: of scientists and and uh, there are these these drugs
Speaker 1: like metaphor mean and Rappa mic in um, which are
Speaker 1: used in humans for different things like helping with organ
Speaker 1: transplants and other conditions that people are are reasonably certain
Speaker 1: will have positive effects on dogs and humans. It's just
Speaker 1: people have been reluctant to try this stuff, and so, um,
Speaker 1: you know, in my interviews, they're talking about for large
Speaker 1: breed dogs who live on average about seven years, they
Speaker 1: think they could live not only kind of two years longer,
Speaker 1: but have you know, much better lifestyle in their latter years,
Speaker 1: and so you know, it's not living forever or anything
Speaker 1: like that. It's kind of like a quality of life
Speaker 1: improvement that people are pretty sure we will see. So
Speaker 1: if that ends up up happening, and if it works
Speaker 1: for dogs to help us connected to humans and to
Speaker 1: what extent, perhaps humans could live just a few years
Speaker 1: longer and what those years would be like? Yeah, I mean,
Speaker 1: so the thesis of this company is that, um, the
Speaker 1: FDA has been reluctant to to even think about drugs
Speaker 1: that are as general. For something as general as aging,
Speaker 1: you know, you have to have a medicine that's targeting
Speaker 1: a specific illness. But if this worked in the dogs,
Speaker 1: then this this could pave UM, this could pave the
Speaker 1: way for maybe easing some of these restrictions. And the
Speaker 1: scientists I talked to you, they don't recommend it for everyone,
Speaker 1: but they're already taking these compounds and and they're curing
Speaker 1: their their sore shoulder that you know, you're in your
Speaker 1: fifties and you've got this sore shoulder for months. And
Speaker 1: this one guy I talked to it went away in
Speaker 1: about a week after after taking one of these drugs. So, um,
Speaker 1: so you know, I mean, you know, I think if you,
Speaker 1: if you make this more mainstream and acceptable by through dogs,
Speaker 1: it really could change our perspective on this field. It's
Speaker 1: also a little bit of the kind of a perfect cell,
Speaker 1: you know, like six months extra and something's life for
Speaker 1: I mean even two your two years more meaningful with
Speaker 1: maybe a dog, but six months it's like who knew,
Speaker 1: who knew if it worked out? Uh so legit question though, Um,
Speaker 1: there's a lot of money slashing around in this space,
Speaker 1: and so talk to us about what the funding is like,
Speaker 1: not only for for this company the startup, but in
Speaker 1: the rest of the space. Yeah, I mean, you know,
Speaker 1: a lot of this stuff has seemed kind of fringe
Speaker 1: in the past, and so you never know, um, what
Speaker 1: to take seriously and whatnot. I mean, I think in
Speaker 1: this case, the company is backed by the Longevity Fund
Speaker 1: is one of its investors, and they're kind of the
Speaker 1: the top investor in this whole field. They've they've done
Speaker 1: a bunch of uh different startups in this area. But
Speaker 1: you know, I think the you can imagine that people
Speaker 1: would pay almost anything to to have their dogs live
Speaker 1: a bit longer. And and so the business case on
Speaker 1: this one seems seems clear to me that if if
Speaker 1: you really could give this to work, um, you know,
Speaker 1: the founders of loyal so they want to try to
Speaker 1: keep the price low um low enough that everyone can
Speaker 1: use this, but I imagine it will start out quite high.
Speaker 1: That's Bloomberg's actually vans in business. We got to r
Speaker 1: Droel Webber. I thought we spent a lot of money
Speaker 1: Carol on pets before, but this is actually taking it
Speaker 1: up a notch. I think it's clear that people will
Speaker 1: pay anything to live longer. Just look at my men
Speaker 1: some cabinet and all my like Cream's annointments. So that
Speaker 1: is so true. Listen, I love it though research dogs
Speaker 1: the life cycle, like you kind of get it and
Speaker 1: why this might make a difference for all of us
Speaker 1: going forward. I'm ready to live a little bit longer,
Speaker 1: so long as I'm healthy. And who doesn't want their
Speaker 1: dog to live longer? I want my dog to live forever.
Speaker 1: All right, you're listening to Bloomberg Business Week coming up.
Speaker 1: The cryptocurrency market, especially Bitcoin, has been defined by volatility
Speaker 1: and big swings throughout its short history, but our next
Speaker 1: guest says it's with good reason and that it won't
Speaker 1: stay that way forever. The CEO of the multi currency
Speaker 1: non electronic crypto wallet Ballet, Bobby Lee, is our next guest.
Speaker 1: This is Bloomberg. This is Bloomberg Business Week with Carol
Speaker 1: Messer and Bloomberg Quick Takes Tim Spinovik from Bloomberg Radio.
Speaker 1: So the wild booling cryptocurrencies, Yeah, it continues, and we
Speaker 1: recently caught up with Bobby Lee. Tim. He's an entrepreneur
Speaker 1: in the crypto space, recently founded Ballet, where he's CEO
Speaker 1: as well. Ballet is a multi currency, non electronic crypto wallet.
Speaker 1: Bobby is also the author of the Promise of Bitcoin,
Speaker 1: The Future of Money and how it can work for
Speaker 1: you Having a crypto walle It is important. You don't
Speaker 1: want to lose do you want to lose it all right, Well,
Speaker 1: he joined us from what you might say was an
Speaker 1: appropriate place considering the volatility and kind of gambling feel
Speaker 1: of the crypto market thus far. He joined us from
Speaker 1: Las Vegas. The way I explained is bitcoin is really
Speaker 1: a global reserve asset class. It started out as a
Speaker 1: very small sort of digital currency invented by a social commoto,
Speaker 1: sort of very very nerdy, kind of punk kind of creation.
Speaker 1: But what we've come to see over the last twelve
Speaker 1: years is that coom really has a role in society
Speaker 1: in the sense that it truly is an independent into
Speaker 1: asset class that has a strict limit on the issuance.
Speaker 1: So people may know biquin has opened the camp of
Speaker 1: twenty one million units, and it was these two factors,
Speaker 1: the strict limit of twenty one million and also its
Speaker 1: own sort of independence, you decentralized nature. It's really a
Speaker 1: beast that cannot be controlled by by the government of
Speaker 1: the world, so it doesn't sec come itself to the
Speaker 1: inflation that we see with the US dollar and other
Speaker 1: currencies that's controlled by central pain printing. So now you
Speaker 1: know the coin has already reached one trillion dollars in
Speaker 1: total value. It's come back down a bit in the
Speaker 1: reasonable back, but I think it didn't go much much
Speaker 1: higher than that. You know, we are still, though, Bobby,
Speaker 1: trying to figure out is it a currency, is it
Speaker 1: a commodity? Is it a collectible? I mean we're still
Speaker 1: having these conversations. You do know, to that the U. S. Treasury,
Speaker 1: the Federal Reserve are you know, increasing their curiosity and
Speaker 1: wanting to know more about it and trying to figure
Speaker 1: out what needs to be there in terms of oversight.
Speaker 1: Could that drastically change the dynamic of cryptocurrency as we
Speaker 1: see it today. Well, so the number one miss no
Speaker 1: more is people misunderstand currency has to be something that
Speaker 1: you can spend with, you know what, to be valuable.
Speaker 1: I take a more traditional of your currencies, really money
Speaker 1: and money even if it's sitting in my pocket, even
Speaker 1: if it's sitting in my bank account, it's useful to
Speaker 1: me even if it's not spent. So this is the
Speaker 1: the important piece the currency. Like bitcoin, it doesn't have
Speaker 1: to be useful only for spending. It can be useful
Speaker 1: as an investment, as a head against installation, as a
Speaker 1: store of value, and in that sense, I think the
Speaker 1: bigpoint will be very successful. And with regards to regulation, yes,
Speaker 1: they are very concerned about it because of the dig
Speaker 1: inner nature of its so called awesomeness, where it's gonna
Speaker 1: be sent across the wire and contaneously all around the world.
Speaker 1: So it really is different from the traditional money in
Speaker 1: that sense. So that's why you have regulatory agencies all
Speaker 1: of the world trying to stand down on bitcoin. But
Speaker 1: fundamentally bitcoin as as its own sort of digital currency,
Speaker 1: it hasn't changed even even with the basically no one
Speaker 1: can force to change it. Well, the regulatory and you
Speaker 1: can do is force people's behavior to change it rather
Speaker 1: than the bitcoin itself. Bobby, what do you do. I
Speaker 1: work with a lot of smart people. I run into
Speaker 1: a lot of smart people who are still like I
Speaker 1: don't quite understand cryptocurrency. I don't understand it other than
Speaker 1: it's maybe you know a place, a risky asset that
Speaker 1: you can just make some money or lose a lot
Speaker 1: of money as well. What do you say to them
Speaker 1: that ultimately will be You say, it's going to transform
Speaker 1: the global economy. How so, so a lot of smart
Speaker 1: people in the world, a lot of successful investors. However,
Speaker 1: even today, the vast majority of them don't understand it,
Speaker 1: don't get bitcoin. And this is the reason why I
Speaker 1: wrote the book. Give an example, ten years ago, when
Speaker 1: I first gone in touch with bitcoin. This is my
Speaker 1: university being involved. I was decently smart person to have
Speaker 1: a college degree computer science and all that, but I
Speaker 1: was an enormous, very newbie, if you will, in terms
Speaker 1: of understanding bitcoin that fundamentals philosophy, the economics, and also
Speaker 1: the technology. So today bitcoin is already told and half
Speaker 1: years old. There's still a lot of smart people in
Speaker 1: the world, educated people who are very successful that when
Speaker 1: they see bitquin for the first time, to them, it's
Speaker 1: strange and it's just not It doesn't it doesn't rock,
Speaker 1: It doesn't really like in terms of what makes this
Speaker 1: so special. So that's fine, It's just that bitcoin is very,
Speaker 1: very complicated. Uh. You know, it took me a decade
Speaker 1: to really understand it to the level that I have
Speaker 1: so far, and I expect myself to really even learn
Speaker 1: more about it in the coming next decade. Uh. In
Speaker 1: terms of how is going to change the world. What's
Speaker 1: amazing is that now, for the first time in the world,
Speaker 1: we have a unique asset class that is digital in
Speaker 1: nature that people can stand around anywhere in the world,
Speaker 1: from person to person without any third party's intervention, without
Speaker 1: any third party oversight. Now, from the regular perspective, and
Speaker 1: something has no oversight and no intermention ability, they worry naturally.
Speaker 1: So they worried because they used to control things. They're
Speaker 1: used to controlling and seeing all the bank wire transfers,
Speaker 1: they're used to controlling which among the people can withdraw
Speaker 1: from their accounts. They're used to having a limit and
Speaker 1: all that stuff, including trading hours or stock markets. They're
Speaker 1: used to all that kind of control. But bitcoin is
Speaker 1: so new and radically different, there's no way to control it.
Speaker 1: And that's how it was invented. It was invented to
Speaker 1: be this wild sort of animal that is not domesticated.
Speaker 1: So that's why it's so hard to the people. So
Speaker 1: how does it become a bigger part of the mainstream
Speaker 1: financial global economy if it's expected to be this wild animal,
Speaker 1: which is fine, but you've got to know that going in.
Speaker 1: But how that sounds to me a bit problematic to
Speaker 1: fitting into kind of a stable system, especially if people
Speaker 1: are counting all yeah, absolutely, you're right. First of all,
Speaker 1: I'm not saying, Nor are people saying that everyone has
Speaker 1: to use me. Remember this not enforced sort of thing,
Speaker 1: in the sense that we are not forcing the world
Speaker 1: to is big point is to get involved in big
Speaker 1: poin what it is is big point is a choice.
Speaker 1: So prior to two thousand nine, prior to the invention
Speaker 1: of bigcoin, people have no choice. If you want to
Speaker 1: send money to someone abroad, you have to go through
Speaker 1: the banking system, which is a swift international wire transfer,
Speaker 1: and there's all sorts of limits, all sorts of delays,
Speaker 1: all sorts of just critical stuff that's very complicated. With
Speaker 1: the surf wire address. For now, do you have no choice?
Speaker 1: Whereas today do you have a choice. People who want
Speaker 1: to get involved with different they can choose to send
Speaker 1: the money in bigcoin. They can also choose to receive
Speaker 1: the money in bigcoins. And don't forget spending money. Traditionally
Speaker 1: we talk about the world is four dimensional, right when
Speaker 1: we talk about sending money, we think of it in
Speaker 1: the three dimensions and in the physicality sending from one
Speaker 1: they need to ad medicine in another country. But the
Speaker 1: fourth dominion, which is dimension with client, is very very important.
Speaker 1: But that's why we save money. The reason we have
Speaker 1: money in a bank account is because we chose to
Speaker 1: not spend it all on the team learned it. That's
Speaker 1: the cumination of what money north the individual Bankts County.
Speaker 1: That's Bobby Lee, the CEO of crypto wallet firm Ballet.
Speaker 1: We heard Ray Dalio say earlier this week, Carol that
Speaker 1: he prefers bitcoin over bonds, and there is the growing
Speaker 1: consensus from investment heavyweights that the market could be a
Speaker 1: good bet over time. Yeah, time will tell obviously. All right.
Speaker 1: Still to come on Bloomberg Business Week, Yogurt and produce,
Speaker 1: we explore two very different corners of the food market.
Speaker 1: We'll hear from app Harvest CEO and founder Jonathan Webb
Speaker 1: on the latest developments in ag tech. Here's a hint
Speaker 1: they're using AI and up. Next, Rabani CEO Peter McGinnis
Speaker 1: gives us a sneak peek into his company's plans for
Speaker 1: growth and commitment to its workers. They're thinking beyond yogurt, Carol, Yeah, absolutely.
Speaker 1: All I know is I'm thinking about food. I'm hungry.
Speaker 1: This is Bloomberg broadcasting from the financial capital of the world,
Speaker 1: Bloomberg Eleve in Frio in New York to Washington, d C.
Speaker 1: Bloomberg to Boston, Bloomberg one oh six one to San Francisco,
Speaker 1: Bloomberg nine sixty to the country Sirius xm chedel one
Speaker 1: nine team, and around the globe the Bloomberg Business app
Speaker 1: and Bloomberg Radio dot com. This is Bloomberg Business Week,
Speaker 1: all right, Jovanni. You know it for it's Greek yogurt
Speaker 1: and for reports of the possible I p O. Later
Speaker 1: on this year, at least according to Bloomberg sources, Jovanni
Speaker 1: posted one point five billion dollars in revenues and recently
Speaker 1: announced that it became the first in the US dairy
Speaker 1: industry to be certified with the Fair Trade Seal of Approval,
Speaker 1: noting how the company has been working with US farms
Speaker 1: and cooperatives to improve working conditions. And Tim, you cut
Speaker 1: up with Chabanni President and CEO Peter mcguinnis you talked
Speaker 1: about operating during the pandemic and also on new product innovations.
Speaker 1: Check it out. The pandemic has been tough for everybody
Speaker 1: in all businesses, but I'm proud of how we performed. UM.
Speaker 1: We set out very early, Tim, very very early on
Speaker 1: UM to take care of our employees, keep them safe
Speaker 1: and supported. UH. Safe was the first thing. And supported
Speaker 1: really was parallel and concurrent, and supported was childcare subsidies
Speaker 1: and special bonuses UH and time off to get vaccinated.
Speaker 1: And it really created a healthy, happy, productive workforce. And
Speaker 1: so we didn't close a single day. We operated twenty
Speaker 1: four hours a day, seven days a week throughout the
Speaker 1: entire pandemic because the demand was there. So the plants,
Speaker 1: the factories ran really well, long and hard and UH
Speaker 1: and it was an investment. Wasn't an expense to take
Speaker 1: care of her employees like that because they're healthier and happier,
Speaker 1: more productive and wanted to come to work. It's really
Speaker 1: remarkable to hear because over the last year we've heard
Speaker 1: some just some devastating stories from food processing plants throughout
Speaker 1: the United States where coronavirus outbreaks took the lives of
Speaker 1: so many employees. But you put measures in place early
Speaker 1: at the company, and as a result, there were no
Speaker 1: coronavirus outbreaks in your plant here in New York and
Speaker 1: South Edmonston, and UH, neither in the one in Twin Falls,
Speaker 1: Idaho as well. Correct. Correct, there was community spread, right,
Speaker 1: but there was no plant outbreak or spread and and
Speaker 1: that was critical. And we jumped on this in mid March,
Speaker 1: tim when it was unpopular to be honest, I mean,
Speaker 1: let's have a frank conversation here. Um. It was considered
Speaker 1: a downstate issue if you go way back a year
Speaker 1: ago March, and there was no cases upstate New York.
Speaker 1: There were no cases in Idaho. And we jumped on
Speaker 1: masks when it was still confusing. Our mask good, bad
Speaker 1: and different. Remember all that confusion, um, And we mandated masks,
Speaker 1: and we were able to get equipment, ton of ppe
Speaker 1: equipment and we cleaned every every two hours in the
Speaker 1: factories because remember back then they thought it was really
Speaker 1: spread uble on surfaces. And we're able to get temperature
Speaker 1: equipment when you couldn't find it. And this is all
Speaker 1: done second week of March. And it was interesting because um,
Speaker 1: was it wildly popular initially? No. But our job as
Speaker 1: a company, your primary job, whether I'm president or CEO
Speaker 1: or the executive leadership team or as a company is
Speaker 1: to keep your employees safe and also keep the company operate. Well,
Speaker 1: let's talk about even that there were surge demand. Well,
Speaker 1: want to talk about that surgeon demand because you mentioned
Speaker 1: that you continued operating because the demand was there. Even
Speaker 1: thinking back to last March, last April, when so many
Speaker 1: companies were struggling with supply chain issues, UM, how did
Speaker 1: you How were you able to keep things going? Again,
Speaker 1: Very proud of the team or sourcing team leaned in
Speaker 1: on preordering milk cultures, fruit cups, foils all up and
Speaker 1: down the supply chain UM and we have great partnerships
Speaker 1: UM throughout our supply chain, and we were able to
Speaker 1: secure and procure what we needed UM and so we
Speaker 1: had no interruption on the supply chain side of things.
Speaker 1: So in terms of the plants running seven and us
Speaker 1: having enough raw material, we powered through it and even
Speaker 1: powered through the height of the pantry loading, which was
Speaker 1: third week of March, you know, year ago March and
Speaker 1: fourth week of March, and so proud of that. Not
Speaker 1: only did we do that, him we launched three new categories.
Speaker 1: We launched oat milk, creamers and and cough R T
Speaker 1: D coffee in the pandemic, so three new platforms, and
Speaker 1: we launched fifty new line extensions throughout all of this,
Speaker 1: so we were able to innovate on top of just
Speaker 1: operating the base business effectively. How are those platforms doing
Speaker 1: those the how is the oat milk doing, how are
Speaker 1: the new products doing. It's it's great. I mean within
Speaker 1: a year we became number to oat Milk and US
Speaker 1: food um close to it, you know, over twenty share,
Speaker 1: which is just phenomenal. We're really happy, and that's really
Speaker 1: the strength of the brand. It's branded Chobanni. Chobani stands
Speaker 1: for trust and quality, and so we have a master brand,
Speaker 1: not a house of brands. A lot of CpG companies
Speaker 1: have all these sub brands. We're Tavanni, so it's Vanni
Speaker 1: Great Urban oat milk, coffee creamer. That's Jobanni President and
Speaker 1: CEO Peter McGuinness. Carol does seem like an I p
Speaker 1: O is only a matter of time for the company.
Speaker 1: We did see toatly go public. That one a long
Speaker 1: time in the making, but Shobanni has had many different
Speaker 1: ownership structures in recent years and has come back from
Speaker 1: some some pretty tough times. Yeah, it's another thing we
Speaker 1: often say this about, you know, a good Harvard Business
Speaker 1: School case study, but it really has had its ups
Speaker 1: and down. So it'll be interesting to watch the trajectory
Speaker 1: going forward. You're listening to Bloomberg Business Week Coming up,
Speaker 1: we round out our broadcast with Jonathan Webb from app Harvest,
Speaker 1: the CEO of discussing the company's first quarterly earnings reports
Speaker 1: since going public and its plans to make robotics a
Speaker 1: stable of indoor farming. This is Bloomberg. You're listening to
Speaker 1: Bloomberg Business Week with Carol Messer and Bloomberg Quick Takes
Speaker 1: Tim Stinovic Bloomberg Radio. Bloomberg recently reported that Hedge Funds
Speaker 1: added more shares of app Harvest than any other investment
Speaker 1: in the consumer stable sector during the first quarter. Well,
Speaker 1: if you're not familiar with the company, app Harvest is
Speaker 1: the ag tech company that recently reported its first quarter
Speaker 1: as a publicly traded company after going public with a
Speaker 1: spack in February. First quarter net sales matched guidance as
Speaker 1: the company reiterated its revenue outlook for the year. They
Speaker 1: are looking to upend agriculture and we've been talking with
Speaker 1: the company and at c suite throughout the pandemic and
Speaker 1: talked with the app Harvest CEO and founder Jonathan Webb
Speaker 1: this week for an update on the certified B Corp
Speaker 1: business that is working to change the way we farm
Speaker 1: and feed the world. Couldn't be more proud of our
Speaker 1: team here in Kentucky where our first facility is two
Speaker 1: point eight Williams square feet. Uh. We built that facility
Speaker 1: on time, on budget and in the middle of in
Speaker 1: the middle of a global pandemic, and we hired five
Speaker 1: people to stand up our first operation. UH and just
Speaker 1: really proud of our team and our our first quarter
Speaker 1: is a public company. UH, it was it was about,
Speaker 1: you know, letting investors know that that we're here to
Speaker 1: deliver on our promises and uh, and we're showing that
Speaker 1: we're hitting the targets that we're putting out in front
Speaker 1: of in front of investors. So tell us about the
Speaker 1: business and what you're seeing in terms of the kind
Speaker 1: of growth that's out there, and uh, you know what
Speaker 1: you are doing to meet all the demand that's out there. Yeah.
Speaker 1: So we're at at harvest. We're building some of the
Speaker 1: world's largest controlled environment agriculture facilities. UH, and we're focused
Speaker 1: on on fruit and vegetable production. First crops were growing
Speaker 1: or tomatoes by Q four. Next year two will be
Speaker 1: growing berries, leafy greens UH and vine crops. But the
Speaker 1: thesis is we we have to bring outdoor open field
Speaker 1: production into controlled environments. And and we're targeting bringing a
Speaker 1: lot of the production that's been pushed down to Mexico,
Speaker 1: bringing that production back to the US, so using less water,
Speaker 1: getting thirty times yield per acre, and and and getting
Speaker 1: the harsh chemical pesticides out on on the demand side,
Speaker 1: and we really cannot build and grow fast enough to
Speaker 1: meet that demand. The grocers know it, Uh, the consumers
Speaker 1: are demanding it. And and we're we're really proud to
Speaker 1: be at some of the largest retail outlets just in
Speaker 1: our first few months of growing where you can find
Speaker 1: us a Kroger, we're now Windy's uh and and publics
Speaker 1: and many of the top twenty five grocers are are
Speaker 1: taking ore, are taking our products. You guys really play
Speaker 1: into this whole concept of kind of you know, locally
Speaker 1: farming and then serving the community. That's a big part
Speaker 1: of what you're doing. Yeah, we're one of four public
Speaker 1: benefit corporations that's a be corp UM and what that
Speaker 1: means is we have high environmental social government standards and uh,
Speaker 1: you know, part of what we're doing is using technology
Speaker 1: to grow fruits and vegetables. Uh that that use far
Speaker 1: less resources. But the way we're doing it and who
Speaker 1: we're doing it with is something I'm incredible proud of.
Speaker 1: Every every employeed app Harvest makes a living wage. Every
Speaker 1: employeed app Harvest has full health care and benefits for
Speaker 1: their family. Uh. And and you know, if we want
Speaker 1: to come out of COVID and say, you know, essential
Speaker 1: workers are important, well, then every person in food and
Speaker 1: agriculture should should make a living wage and and and
Speaker 1: get full benefits. Also, every employeed app Harvest has ownership
Speaker 1: in the company. Uh. And you know, I was told
Speaker 1: that this was a pretty radical idea and food and
Speaker 1: agriculture and uh, it's the r o I and that
Speaker 1: investment has been has been what's radical and the the
Speaker 1: the We've had nearly ten thousand people apply to work
Speaker 1: at our company in the middle of COVID. Uh and
Speaker 1: when you see the labor shortages around the country where
Speaker 1: the polar opposite, we we we can't get you know,
Speaker 1: we can't go through the applications fast enough. People want
Speaker 1: to work here. And part of that is showing yes,
Speaker 1: we spend a little money on on investing in our employees,
Speaker 1: but be treating our employees with dignity and respect has
Speaker 1: been an incredible r o I on on production and
Speaker 1: productivity here inside the company. So tell me, you say
Speaker 1: you you provide a living wage. So what are your workers?
Speaker 1: I guess on average, I don't know what that always
Speaker 1: means on average? But what are they making? Yeah? So
Speaker 1: we we have a really wide range of skill sets
Speaker 1: here at the company. So we have engineers and computer
Speaker 1: scientists working on the robotics and AI UH, and we
Speaker 1: have planned scientists all the way down to you know,
Speaker 1: our our our cleaning folks and Janet oriole staff and
Speaker 1: all the way up to crop care specialists. But you know,
Speaker 1: there's a standard living wage in the US and for
Speaker 1: US entry level, even off the street, thirteen dollars an
Speaker 1: hour full benefits. UH. Hitting production targets gets people up
Speaker 1: to eighteen or twenty dollars an hour, you know. So
Speaker 1: we're and where we're at is really cold country where
Speaker 1: if you look at most of the coal mines in
Speaker 1: the US that's shut down, majority of those were in
Speaker 1: eastern Kentucky and West Virginia, you know. So so here
Speaker 1: we're far above the current wage that that's out and
Speaker 1: above h well, what's already out on the street around us.
Speaker 1: So you know, we're we're trying to tell people if
Speaker 1: they come to work and show up every day, you
Speaker 1: know we'll we'll do our best to take care of them.
Speaker 1: If if they're coming to to work and take care
Speaker 1: of of what we're doing here day to day. How
Speaker 1: difficult though, is it to get to profitability? When do
Speaker 1: you expect to get to profitability? So each facility we've
Speaker 1: islanded where um we were. We we've got a pn
Speaker 1: L for each facility, and as we ranch each each
Speaker 1: facility up about uh year and a half, two years
Speaker 1: in uh it gets to about steady state, and then
Speaker 1: each asset is about a twenty five year twenty to
Speaker 1: twenty five year life of that asset. So each facility
Speaker 1: we build, we'll be operating twenty to twenty five years.
Speaker 1: This is under a current environment where prices and agriculture
Speaker 1: and food generally are pretty suppressed because of where we're
Speaker 1: currently at. I mean, you look at our competition in Mexico.
Speaker 1: Is this gonna last? Are we gonna? Are we gonna
Speaker 1: continue to allow food sold in the US where people
Speaker 1: in Mexico are getting paid five dollars a day and
Speaker 1: where in some cases, you you know, you can find
Speaker 1: a legal chemical pesticides UH on that product. I mean,
Speaker 1: agriculture has such a long way to go to catch
Speaker 1: up where consumers are demanding and where regulators are pushing. Um.
Speaker 1: That that again, you can make an argument that the
Speaker 1: prices today are artificially suppressed, and we'll see those prices rise.
Speaker 1: And that's where you know, app harvest today and under
Speaker 1: current environment UH can exceed and do do very well.
Speaker 1: But as those prices rise, and what we'll do even
Speaker 1: better because we can compete under the conditions today and it
Speaker 1: it won't change for us. The other factor on top
Speaker 1: of all of this too is climate disruption. Uh. You
Speaker 1: look at an open field farmer that has to deal
Speaker 1: with drought or wildfires or not enough water or water scarcity.
Speaker 1: Nine of a fruit and vegetable is water. Uh. And
Speaker 1: and we run completely on recycled rainwater, which ultimately keeps
Speaker 1: our costs lower. So um again, it's it's competing today
Speaker 1: and today's playing field. But then also have building a
Speaker 1: resilient you know, resilient UH company that that can be
Speaker 1: not only competitive today, but but really stand out five
Speaker 1: ten years from now. Hey, listen, this is something I've
Speaker 1: talked about David Lee, you know, formally impossible foods, but
Speaker 1: also at your company, president of the company. You know,
Speaker 1: we've talked about lighting in the electricity costs. You guys
Speaker 1: do hybrid lighting. I know you you you know are
Speaker 1: using the sun, You're using l E. Ed s um
Speaker 1: tell us about that component of the equation and how
Speaker 1: that is going in terms of cost and impact on
Speaker 1: the environment. Well, if you look at impact on the
Speaker 1: environment with agriculture today, you have hard chemicals that are
Speaker 1: degrading our waters. Were the un is predicted we have
Speaker 1: sixty years left of fertile top soil. I mean, you
Speaker 1: talk about a statistic that we don't talk about that's
Speaker 1: completely jarring, is sixty years left. And I mean, so
Speaker 1: I'm sitting again in coal country and think of agriculture.
Speaker 1: We're mining nutrients out of the ground and they're not replenishing.
Speaker 1: We're in a glass facility that allows us to use
Speaker 1: sunlight first and only add micro mole light from the
Speaker 1: led that we need to add that the sun is
Speaker 1: not adding. Running completely on recycled rainwater, also being closer
Speaker 1: to market reducing that diesel consumption. So if you're looking
Speaker 1: at a fruit and vegetable coming two thousand miles from
Speaker 1: California or Mexico to the East coast. You know, we
Speaker 1: get that down to a day drive by where we're
Speaker 1: at and and lighting is one one piece where we
Speaker 1: have energy and using the L E d S gets
Speaker 1: gets our lighting energy consumption down. But it's really and
Speaker 1: we're still working on this. We're working on them with
Speaker 1: a lot of universe these and outside stakeholders. Is what
Speaker 1: is that life cycle analysis and agriculture there's no one
Speaker 1: you can really look to to get good answers on
Speaker 1: what what are the push points? Energy was very easy, uh,
Speaker 1: to to be able to judge on. Uh. Here's an
Speaker 1: example solar and wind versus fossil fuels. That's very binary.
Speaker 1: It's you know, one verse the other. Agriculture is incredibly complex.
Speaker 1: The US has our our food is wasted and goes
Speaker 1: to a landfill. So not only is it the inputs, uh,
Speaker 1: the energy you consume, there's the food waste because of
Speaker 1: how far we're trucking the food itself. Um that that
Speaker 1: again there there's and we're working on this with the
Speaker 1: universities to try to come up with an overall life
Speaker 1: cycle analysis. But there's nowhere to look U s d A.
Speaker 1: No one has done a really good job on saying,
Speaker 1: you're the environmental benefits of controlled environment agg are the
Speaker 1: drawbacks to open field here that played opportunities to get better? Uh,
Speaker 1: there's no world one organization to look to, whether that's
Speaker 1: the U N or the U s d A or
Speaker 1: any other non governmental organization. What's incredible to see is
Speaker 1: just in a short period of years, Carol, the decline
Speaker 1: in the number of people here in the US who
Speaker 1: are actually farming. I know it and changed. It is
Speaker 1: totally changing. It's a really tough business. I think the
Speaker 1: challenge moving forward, I mean this is easy to say,
Speaker 1: is that how do we feed the world in an
Speaker 1: efficient way, right, make it more productive, but also protect
Speaker 1: the climate. Uh. And so this is one of those
Speaker 1: companies that's playing into it. That was of course a
Speaker 1: harvest CEO Jonathan Webb. And that wraps up the weekend
Speaker 1: edition at Bloomberg Business Week from Bloomberg Radio. Thanks so
Speaker 1: much for joining us. I'm Carol Masser and I'm Tim Stanovak.
Speaker 1: Be sure to tune into our Bloomberg Business Week Daily
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Speaker 1: Time on Bloomberg Radio. You can also watch our daily
Speaker 1: broadcast on YouTube. Just search Bloomberg Global News and check
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Speaker 1: a great weekend, enjoy the holiday. This is Bloomberg