Speaker 1: Yeah, Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene
Speaker 1: Jay Leye. We bring you insight from the best in economics, finance, investment,
Speaker 1: and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud,
Speaker 1: Bloomberg dot Com, and of course on the Bloomberg What
Speaker 1: a week Ahead, then a Federal reserved decision and the
Speaker 1: payrolls report they will come to you Wednesday Friday, respectively.
Speaker 1: And Secretary Minution heading to China with a big delegation
Speaker 1: to talk trade at a time when the Commist Department
Speaker 1: is wrestling with request with allies for tariff exemptions and
Speaker 1: really pleased to say that this morning, this Monday, We're
Speaker 1: joined by Peter Henry is ny U Stern School of
Speaker 1: Business Dean emeritus and economists as well. Peter, fantastic to
Speaker 1: have you with us on the program kickoff things this week.
Speaker 1: Good morning, good morning, delight to be with you. Let's
Speaker 1: begin with a Secretary Monution going to China show. We're
Speaker 1: heading to Beijing with a big trade delegation, Allies trying
Speaker 1: to work out whether the tariffs on aluminium still applied
Speaker 1: to them and whether they'll get tariff exemptions. Extended. Do
Speaker 1: you have any clarity on on the direction to travel
Speaker 1: of this specific issue, Pisa, Well, I'm not being on
Speaker 1: the forecast how this how this negotiation is going to
Speaker 1: turn out. I think that's probably a fool's errand but
Speaker 1: I think the big picture to remember here is that
Speaker 1: the global economy is deeply depending on the United States
Speaker 1: and China having good relations, and that's got to be
Speaker 1: the center sort of negotiating stance of both both parties, because,
Speaker 1: you know, forgetting that, we lose sight of the fact
Speaker 1: that the United States has been benefiting enormously from lower
Speaker 1: consumer goods prices from from trade with China for years,
Speaker 1: and so trying to get a better deal in some
Speaker 1: sense for US corporations, it's imperative to remember that the
Speaker 1: US economy, the world economy is a lot better off
Speaker 1: as a result of having more not less trade. We're
Speaker 1: sort of low and side of the fact as well,
Speaker 1: that much of what is on the table is just
Speaker 1: a proposal on the table and not a real change
Speaker 1: in policy. Um, are you surprised that we're a year
Speaker 1: and change into this administration and actually haven't seen a
Speaker 1: substantial change in policy. Had a lot of proposals, a
Speaker 1: lot of retrick, but no real change in policy as
Speaker 1: far as I could see. Yeah, I think you know,
Speaker 1: you've seen a lot of volatility in terms of what
Speaker 1: sort of come out of in terms of proposals from
Speaker 1: this administration. I mean, you saw it about a week
Speaker 1: ago now when President Trump uh indicated he wanted to
Speaker 1: be back in as part of tp TPP and then
Speaker 1: not part of TPP. I mean, I think that's the
Speaker 1: sort of thing you're alluding to. A bigger vision around trade,
Speaker 1: which says, look, the United States is only five percent
Speaker 1: of the world's population, but we're twenty percent of global GDP,
Speaker 1: and that would never happen without a world of free trade,
Speaker 1: and in fact, we should be pushing for more of
Speaker 1: that and creating more of a positive some outcome which
Speaker 1: will be good not only for the United States, but
Speaker 1: be good for the world, but in particularly would be
Speaker 1: good for the U. S consumers and the US workers.
Speaker 1: And now we haven't seen that. We had a day
Speaker 1: of hope on Friday between North and South Korea and
Speaker 1: the President actually congratulating President She some warm words for
Speaker 1: President She for the amount of pressure that he's put
Speaker 1: on North Korea and I guess the big question mark
Speaker 1: at this point is whether we can blend continue to
Speaker 1: blend the foreign policy effort of this administration with the
Speaker 1: international trade story as well, because the President himself has
Speaker 1: done that, and you just wonder whether there's an open
Speaker 1: door to walk back some of this retric on trade
Speaker 1: now that some improvement has been made on the North
Speaker 1: Korea side of things. I think it's an important point.
Speaker 1: I think that anything which, if you will, sort of
Speaker 1: de escalates the rhetoric around trade wars or retaliation and
Speaker 1: recognizes the positive some nature of global trade, I think
Speaker 1: would be would be useful, would be useful from the
Speaker 1: from the point of view of not um not backing
Speaker 1: people into corners. But also I think I think markets
Speaker 1: would welcome that as well, and I think that would
Speaker 1: reduce some of the volatively we've seen it recently. Just
Speaker 1: in terms of what Marcus are looking at this morning,
Speaker 1: deal flow really picking up another one crossing the Bloomberg
Speaker 1: Married vacations to acquire I l G in a cash
Speaker 1: and stock deal, and Tom King you add that on
Speaker 1: to Sprint t Mobile this morning, a deal with Marathon
Speaker 1: in the in the oil space, the energy space, and
Speaker 1: over in the UK. Of course, Walmart is selling that
Speaker 1: steak in in Asta to Saintsbury's two. So a lot
Speaker 1: of deal flow this Monday morning. I wonder higher rates,
Speaker 1: like money was cheap, let's get it done now, maybe
Speaker 1: I really wonder about that. A lot of stock deal
Speaker 1: in this, and you just look at the equity as
Speaker 1: a currency, and I think some companies are trying to
Speaker 1: spend it while they can. Yeah, well let's go, let's go.
Speaker 1: We got Dean Henry with us, which is a good
Speaker 1: reason too. I should excuse me, John Dean Emeritus Henry
Speaker 1: with us as well. I just called him Peter long before,
Speaker 1: long before you darken the door, n y you. It
Speaker 1: was one of my original sponsors, and we always thanks
Speaker 1: during School of Business for their support of bloombergun the economy,
Speaker 1: in Bloomberg Surveillance. Thank you. We've had a lot of
Speaker 1: your students over the years. They've done very well. Really,
Speaker 1: yes they have. Yeah, I mean Tanya I think pulled
Speaker 1: a quality c you know, can we can we just
Speaker 1: can we just think of Tanya for a little while
Speaker 1: that she's been called it was a miracle she got
Speaker 1: through Stern students to listen to this. They do it's
Speaker 1: a forced podcast for the first time. I will have
Speaker 1: two books of the summer. That's how good the book
Speaker 1: flow is. Ben Garrett Grafts The Threat Matrix is on
Speaker 1: the Federal Bureau of Investigation and on the Robert Mueller
Speaker 1: that we Don't Know And the other book took at
Speaker 1: least three seconds to decide to feature is a book
Speaker 1: of the summer. Robert call Plan Agree or Disagree has
Speaker 1: driven the debate on realist foreign policy in America for decades.
Speaker 1: His new book, The Return of Marco Polo's World, is
Speaker 1: a set of articles and new observations which is definitive.
Speaker 1: Robert Kaplan joins us in Washington in FM Studios. He
Speaker 1: is with your Asia group, Ian Bremer Shop, among other abilities.
Speaker 1: What's your number one message to Mr Manutian going to China,
Speaker 1: Robert Kaplan. I think the number one message Tom is
Speaker 1: to preserve the relationship that um you know, that trade
Speaker 1: has the ability if you have a really you know,
Speaker 1: tumultuous trading relationship that's not well defined, that's not on board.
Speaker 1: This affects the military situation in the South and East
Speaker 1: China Sea. It affects politics throughout the Indo Pacific in
Speaker 1: Central Asia. In other words, trade is not isolated. It's
Speaker 1: all part of a geopol clitical mix within the synthesis.
Speaker 1: And this is the heart of your book as the
Speaker 1: complexities that need to be thought through the reality as
Speaker 1: we have a president who is bilateral, he says, and
Speaker 1: many would say, my deal or the highway is the theory.
Speaker 1: How do you drag this president into a more complex discussion? Um?
Speaker 1: I think what you do is um. You well, first
Speaker 1: of all, you have advisors, and the advisors, as extreme
Speaker 1: as some of them may be, maybe are still far
Speaker 1: more nuanced than the president is. And you, you know,
Speaker 1: you just tell him that, you know, if you do this,
Speaker 1: here are all the consequences. Here are all the second
Speaker 1: and third and fourth order effects. And China is developing
Speaker 1: a society and a system that is going to be
Speaker 1: uh you know, that is going to be not only
Speaker 1: a great competitor of the United States it already is,
Speaker 1: but is on track to overtake the United States in
Speaker 1: the decades to come unless we're very careful and can
Speaker 1: compete with them throughout Eurasia and the rest of the
Speaker 1: world in a very sly fashion. So Robert at the
Speaker 1: moment and Jonathan by the way, speaking, and great to
Speaker 1: have you with us on the program. Thank you for
Speaker 1: joining us. Robert Um the guest. The question for me
Speaker 1: is China sort of establishes the Silk Road strategy for
Speaker 1: the whole region. What is the geo strategic sort of
Speaker 1: aim of the United States and this administration for Asia
Speaker 1: right now? Well, I think, Um, we've had seventy five
Speaker 1: years of new of liberal world order building, and the
Speaker 1: mistake that many of us have made is to think
Speaker 1: that that's normal. But in the long span of history,
Speaker 1: the period between nineteen and the coming to power of
Speaker 1: Donald Trump has been an historical aberration. Most of history
Speaker 1: is geopolitical jockeying, positioning, wars, competition, rivalry, and trade can
Speaker 1: be just an adjunct to geopolitical rivalry, whereas free trade
Speaker 1: is an adjunct to liberal world order building. So what
Speaker 1: Trump really signifies is a return in you know, is
Speaker 1: you know is counterintuitive? Is this sounds Trump actually signifies
Speaker 1: a return to a more traditional form of world history.
Speaker 1: Expand on that a little bit, what were the the
Speaker 1: implications the consequence of that approach being? Robert, Well, the
Speaker 1: consequences of this The twentieth century was about ideological warfare,
Speaker 1: and that led to the deaths of tens of million,
Speaker 1: a hundred and fifty million people in two world wars, etcetera.
Speaker 1: Geopolitical conflict is less bloody, um but it but, but
Speaker 1: it's equally tumultuous. If you look at the eighteenth century,
Speaker 1: the nineteenth century, the problems you know, you know, British
Speaker 1: Foreign Minister Castle Reay during the Napoleonic Wars. This is
Speaker 1: the period we're back to um where you have the
Speaker 1: United States, China, and Russia UH competing with each other
Speaker 1: with lesser powers like Iran, India, et cetera. Where where
Speaker 1: where a bipolar world during the Cold War was very stable. Um,
Speaker 1: but we're entering a world where it's not even multipolarity.
Speaker 1: It's more fractured than that. Robert kapp in one final question,
Speaker 1: and these are people that have actually read your books,
Speaker 1: and no doubt we'll give a serious skim and full
Speaker 1: read of the return of Marco Polo's World. How should
Speaker 1: Republican state department types respond to this president? Many are
Speaker 1: saying they won't serve this president. I think of Nick
Speaker 1: Burns with his public service, Richard hass with his public service,
Speaker 1: and others should they stay away from this president or
Speaker 1: with a new secretary of State, should they choose to
Speaker 1: serve as a public duty? Uh? Tom. The way it
Speaker 1: works in Washington is we have of such a vast
Speaker 1: imperial system of under secretaries, assistant secretaries, deputy under secretaries,
Speaker 1: and on and on that you decide to serve based
Speaker 1: on whether you trust the person who's hired you. So
Speaker 1: if they trust Mike Pompeo as State, they should go
Speaker 1: to work for him. If they trust Jim Maddis at
Speaker 1: the Defense Department, they should go to work for him.
Speaker 1: If they do not trust John Bolton at National Security,
Speaker 1: they should not go to work for him. It's a
Speaker 1: very diversified system so that it you know, of course
Speaker 1: it matters who's the president, but what matters particularly is
Speaker 1: who their boss is and if they can trust their
Speaker 1: boss both morally and philosophically. Robert Capa, thank you so
Speaker 1: much for visiting us today. His book my book of
Speaker 1: the summer, The Return of Marco Polis World. I'll feature
Speaker 1: that out on social We like to do interviews after
Speaker 1: interview where there's a theme and there is a good conversation.
Speaker 1: We did that with Ian Bremer Thursday, Friday last week,
Speaker 1: Robert Kaplan joining us with this wonderful the Return of
Speaker 1: Marco Polos World, one of my books of the summer,
Speaker 1: and now joining us James Travitz, who had my book
Speaker 1: of the Summer a year or two ago, is leaders bookshelf,
Speaker 1: just absolutely superb. He is, of course at Fletcher School.
Speaker 1: Admirals Tavidez, good morning. In Robert Kaplan's book, chapter after
Speaker 1: chapter he circles back to where he was with the
Speaker 1: Asia Cauldron and five years ago, which is a South
Speaker 1: China sea and submarines. Does your US Navy need a
Speaker 1: new Himan rick Over to drive forward submarine development. We've
Speaker 1: actually got a terrific Chief of Naval Operations who is
Speaker 1: a submariner, Tom Admiral John Richardson, and he's just superb.
Speaker 1: He focuses on the connections between our submarine force, cyber technology,
Speaker 1: unmanned vehicles, and our ability to use our strategic deterrence
Speaker 1: at sea, so that that Rickover is walking the streets
Speaker 1: today and we're lucky to have them. Do we need
Speaker 1: a larger navy? Robert Keppelan says no, we need a
Speaker 1: more intelligently deployed navy. But if we're gonna have a
Speaker 1: return of Marco Polo. The span from at least the
Speaker 1: Persian Gulf across the Indian Ocean, through the Straits of
Speaker 1: Malacca up through South China Sea up to Korea. With
Speaker 1: all the news last week that screams to be navy, Navy, Navy,
Speaker 1: it does indeed. And my latest book tom is Seapower,
Speaker 1: The History and Geopolitics of the World's Ocean, and it
Speaker 1: talks about this. What we are recognized is that Marco
Speaker 1: Polo went from east to west. What's happening now from
Speaker 1: west to east one belt, one road. China is reversing
Speaker 1: the voyages of Marco Polo and moving across that area.
Speaker 1: And so we need a bigger navy. I don't think
Speaker 1: it has to be thousands of ships, but we're only
Speaker 1: at about two hundred and seventy. We need to be
Speaker 1: up around three twenty three d and thirty ships will
Speaker 1: get there, but we also need to deploy it more
Speaker 1: intelligently and focus. As you said, and as Robert Captain
Speaker 1: would agree, on the South China see Admirals Travitas. Has
Speaker 1: China ever initiated a conflict with a Western power? No,
Speaker 1: they have never done so, and they have always held
Speaker 1: themselves and here's really the point, held themselves above the
Speaker 1: rest of the world. They think of themselves as that
Speaker 1: middle kingdom between heaven and Earth, and they've always felt
Speaker 1: we don't need to do that. That resulted a course
Speaker 1: in invasions of China from Western powers. Now, what we
Speaker 1: should remember is that China has attacked other Asian nations
Speaker 1: in the past and will continue to do that as
Speaker 1: they consolidate power in the region. And if we don't
Speaker 1: want the South China Sea in the Western Pacific to
Speaker 1: turn into a Chinese lake, we're going to have to
Speaker 1: remain engaged. Having said that, would we want the Gulf
Speaker 1: of Mexico to turn into a non US lake? You know,
Speaker 1: in the nineteenth century, of course, we had the Monroe Doctrine,
Speaker 1: which was designed for that not to happen. But I
Speaker 1: think we've matured in our geopolitics, and the idea that
Speaker 1: the United States has a desire or a need to
Speaker 1: simply declare the Gulf of Mexico territorial sea and build
Speaker 1: a nine dash line around it is preposterous, and I
Speaker 1: don't think that we should allow China to do the
Speaker 1: equivalent around the South China Sea. Having said that, are
Speaker 1: we misinformed in terms of what we believe to be
Speaker 1: the threat from China. I think that there is a
Speaker 1: little bit of China hysteria out there to the degree
Speaker 1: that we believe China wants to dominate the world. I
Speaker 1: don't think they do. But here's what they want. They
Speaker 1: want control of the South China see because it represents hydrocarbons,
Speaker 1: which is the missing card in their strategic suite. They
Speaker 1: want the ability to dominate East Asia and move their
Speaker 1: goods in the way they want to. And they want
Speaker 1: to get into the Indian Ocean. So they're not reaching
Speaker 1: for global hegemony, but really regional control. It would not
Speaker 1: be a good thing for the United States to see
Speaker 1: that to China at this point. Does the President understand
Speaker 1: that dialogue? I haven't seen, and I'm talking more from
Speaker 1: a military standpoint. ADDM mean, we've got the trade discussion
Speaker 1: in a bilateral slash my way or the highway dialogue.
Speaker 1: But does the President understand astra Vita's kaplan world. I
Speaker 1: don't think he does, And of course he famously is
Speaker 1: not a great reader of books. But a lot of
Speaker 1: your listeners are Tom and on this one, I'd recommend
Speaker 1: Graham Allison. He's a brilliant his new his new book,
Speaker 1: Destined for War China in the US and the Century.
Speaker 1: And as you know, Tom, there's no question mark at
Speaker 1: the end of that title. So Graham takes a pretty
Speaker 1: aggressive view towards China. I think if you read that book,
Speaker 1: you get a pretty good understanding. Perhaps someone should summarize
Speaker 1: it for the president. Do you believe that there will
Speaker 1: be a war between the United States and China? I
Speaker 1: do not. I believe over the long term, throughout the century,
Speaker 1: our interests converge more than they diverge. But if we
Speaker 1: are foolish about it and are either too aggressive that
Speaker 1: would lead to war, or if we're too passive that
Speaker 1: would lead to war. We have to kind of dial
Speaker 1: this one in. I'm gonna put out on Twitter, folks,
Speaker 1: Bloomberg Radio. We'll see at first see Power, James Travids.
Speaker 1: It is just read it for the first time. The
Speaker 1: admiral went to see you don't have to read it
Speaker 1: for anything else. He's like in the smallest boat in
Speaker 1: the Davy. He's got his float, he's on his arms.
Speaker 1: He's like eighteen or nineteen years old and he's going
Speaker 1: out of San Diego Harbor, and you know it's just
Speaker 1: that alone is worth reading. Right now, Sarah Sanator joins
Speaker 1: us with Bernstein, and we love having her on to
Speaker 1: talk about I guess our national diet and our national
Speaker 1: food and Sarah, I want to ask a basic McDonald's
Speaker 1: one oh one question, which is a butch cassidy. Who
Speaker 1: are these guys? And I do that Looking at the
Speaker 1: two thousand seventeen annual report quote, we have committed to
Speaker 1: getting more of our restaurants in the hands of our
Speaker 1: franchise ease and developmental licensee strategic partners. There's enough ease
Speaker 1: in there for me to know that's a bunch of
Speaker 1: hot air. What does mc Who is McDonald's. Do they
Speaker 1: really own the restaurants that we're eating out of. I
Speaker 1: don't know if I would characterize that is hot air
Speaker 1: because they answer your question, Um, McDonald's is a brand owner.
Speaker 1: So their job, frankly is to do things that for
Speaker 1: the brand. So think about marketing and menu innovation and
Speaker 1: essentially how they want their global footprint to look, and
Speaker 1: then they leave it in the hands of their partners,
Speaker 1: the franchise ease, the licensese to execute against that plan. So, yes,
Speaker 1: there are a lot of ease in there, but I
Speaker 1: don't think that that diminishes the fact that the strategy
Speaker 1: is working for them. The strategy has been brilliant with
Speaker 1: lower revenue growth. Explain how you go from twenty seven
Speaker 1: billion of revenue down to two ish billion and that's
Speaker 1: a good thing. What does it mean that they're five
Speaker 1: billion short on revenue from where they were a couple
Speaker 1: of years ago. Yeah, in this case, one of the
Speaker 1: rare cases, we're shrinking the top line is a good
Speaker 1: thing because it reflects the fact that instead of running restaurants,
Speaker 1: they're just collecting the royalty from them. So right, so
Speaker 1: instead of reporting acent of sales for a restaurant, they're
Speaker 1: only reporting called fifteen percent of sales. But those are
Speaker 1: very high margin. They basically have minimal costs associated with them,
Speaker 1: just the cost of owning the real estate as McDonald's
Speaker 1: tends to do um and not much else. Beautifully explained,
Speaker 1: they take cents or so down to eb Yeah. Well, Sarah,
Speaker 1: I want to go through the menu. I want you
Speaker 1: to go through the menu if you can, because many
Speaker 1: people may not be familiar with things like turtle drinks
Speaker 1: or even being able to use your mobile app to
Speaker 1: pay for things at McDonald's. Go through the menu, force
Speaker 1: tell us what's working for them, and don't leave out
Speaker 1: the garlic. I'll try not to. I think the working
Speaker 1: for them is but we think of as the bar
Speaker 1: bill strategy, which is on the one end you have
Speaker 1: you know, more premium products. Last year there was a
Speaker 1: real focus on these signature crafted hamburgers, which had three
Speaker 1: different builds that you could choose from, and you could
Speaker 1: choose either uh hamburger or a chicken sandwich, and you
Speaker 1: could choose different kinds of buns. So it's sort of
Speaker 1: what I would call mask customization. And they were frankly
Speaker 1: very well received because they're pretty delicious. So you had,
Speaker 1: you know, things like a Pico de Gaio which also
Speaker 1: had guercomole which tasted like real guacamole um, and other builds,
Speaker 1: the two other builds, both of which had bacon, because
Speaker 1: because everything tastes better with bacon. So on the one
Speaker 1: end you had that the premium, and then on the
Speaker 1: other end you had them really emphasizing being competitive in value,
Speaker 1: as cvster Brick would say, so um not necessarily being
Speaker 1: the lowest price point and every item at every time,
Speaker 1: but having an offering like the Mick Pick two for
Speaker 1: two or the dollar soda two dollar coffee that was
Speaker 1: very compelling UM to two restaurant goers. And we're seeing
Speaker 1: that again this year with them one to three dollar
Speaker 1: value menu on the on the low end, but then
Speaker 1: also this fresh beef quarter pounder, which again UM is
Speaker 1: now available in New York area and it's it's a
Speaker 1: very good sandwich. So McDonald's is really trying to stay
Speaker 1: true to this UM for honestly being a progressive burger
Speaker 1: company UM, such that they have good food that tastes
Speaker 1: good as well sourced, but also a value price point
Speaker 1: that can appeal broadly. Sarah, How are they able to
Speaker 1: do this so quickly? You know, I think, UM. You know,
Speaker 1: what we saw with the leadership turnover in was was
Speaker 1: really a cultural shift and that was very much the focus,
Speaker 1: which is, you know, be fast, be nimble, fail fast,
Speaker 1: as they say, UM, but make sure that that if
Speaker 1: there's a demand for a product in the market, that
Speaker 1: McDonald is going to meet it. So you know, All
Speaker 1: day Breakfast is a good example of this. You know,
Speaker 1: that's probably the most requested and new item or menu edition,
Speaker 1: probably since they added breakfast in the seventies. And yet
Speaker 1: for a very long time the system was hesitant because
Speaker 1: the operational challenges. And I think you know, the focus
Speaker 1: this time with this management team is to make sure
Speaker 1: that things like operational challenges didn't stand in the way.
Speaker 1: Same with fresh beef quarter pounders. It's a good sandwich.
Speaker 1: They know it tested well, people liked it, and they
Speaker 1: were going to figure out a way to bring it
Speaker 1: to market. All right. For Tom that doesn't necessarily get
Speaker 1: the mic cafe that has been so popular. He can
Speaker 1: now get it into mic Cafe in a bottle. Tell
Speaker 1: us about those kinds of ventures, because it's not only
Speaker 1: Mick Cafe in a bottle. There's Mick Cafe bags, cake cups,
Speaker 1: and canisters. That's right. I mean, this is still a
Speaker 1: very very small piece of their business. You know, it's
Speaker 1: it's and it's always it's always going to be hard
Speaker 1: to to move the needle um. You know, in the US,
Speaker 1: when you have fourteen thousand restaurants doing you know, two
Speaker 1: and a half million dollars UH per box, you know
Speaker 1: any anything, you know, thirty five billion dollar system, it's
Speaker 1: very hard for anyone product, and yeah, but it's going
Speaker 1: to allow me to segue into Starbucks. So that's why
Speaker 1: I did it. We're talking about it, okay, So then
Speaker 1: there's value to you. I think there's value there too
Speaker 1: to McDonald's. Mean, look, it's a testament to the fact
Speaker 1: that the brand is strong enough to be sold outside
Speaker 1: of the McDonald's restaurants, whether ever, will be hugely meaningful.
Speaker 1: Probably not, but you know, but people like the costs.
Speaker 1: So tell Tom about Starbucks and what their challenges are,
Speaker 1: you know, I think, look, Starbucks is a very good
Speaker 1: global brand. Um. You know, our view is that increasingly
Speaker 1: it may just be more mature than uh than it's
Speaker 1: you know, the company is willing to acknowledge or let up. Um.
Speaker 1: You know, there's there's long been that joke about Starbucks
Speaker 1: and every corner um, and and that is increasingly I
Speaker 1: think part of the issue for them, there's just you know, growth,
Speaker 1: there's only so much, so many units you can add
Speaker 1: before they are to impact the existing business. Sir. Before
Speaker 1: I let you go Chipotle seven hundred down to three,
Speaker 1: I guess with an enthusiastic bounce, where are you on
Speaker 1: CMG right now? I mean, I like this stock. I
Speaker 1: have to say, uh, you know, it's been been sort
Speaker 1: of a long suffering bowl. We saw all these opportunities
Speaker 1: for the business, and the last management team just wasn't
Speaker 1: executing against them. And I think the reason you've seen
Speaker 1: this big move is because the opportunities are very much
Speaker 1: there in terms of driving top line through basic things
Speaker 1: like marketing, you know, more effective advertising, some digital issues
Speaker 1: and also a lot of costs. And we finally have
Speaker 1: a CEO and now a Chief Marketing Officer UM and
Speaker 1: chief restaurant officer, and I t that are that are
Speaker 1: there and capable of executing. What can they learn from
Speaker 1: Stephen j Esterbrook? I think, you know, look, I think
Speaker 1: being nimble, being flexible that and and listening to what
Speaker 1: your customers without doing, you know, going too far straight
Speaker 1: from your core value propositions. I think everybody can learn that. Sir,
Speaker 1: just terrific. Thank you, Sarah Snatory short notice on Bernstein McDonald.
Speaker 1: There was the L word pim listen. It's just stunning.
Speaker 1: Thanks for listening to the Bloomberg Surveillance podcast. Subscribe and
Speaker 1: listen to interviews on Apple Podcasts, SoundCloud, or whichever podcast
Speaker 1: platform you prefer. I'm on Twitter at Tom Keane. Before
Speaker 1: the podcast, you can always catch us worldwide. I'm Bloomberg Radio.