Speaker 1: Bloomberg Audio Studios, Podcasts, radio news.
Speaker 2: This is Bloomberg Business Week Inside from the reporters and
Speaker 2: editors who bring you America's most trusted business magazine, plus
Speaker 2: global business, finance and tech news. The Bloomberg Business Week
Speaker 2: Podcast with Carol Messer and Tim Stenebeck from Bloomberg Radio.
Speaker 3: Har Everyone, Welcome to the Bloomberg Business Wee Weekend Podcast.
Speaker 3: This week, a key US price gauge top forecast for
Speaker 3: our third straight month on gains and rents and transportation costs.
Speaker 3: Banning fears it will stick and delay FED interest rate cuts,
Speaker 3: We've really rolled back our expectations when it comes to
Speaker 3: FED moves this year. This hour, though, on transportation, we've
Speaker 3: got David Neilman. He's the founder of five commercial airlines,
Speaker 3: including Jeff Blue and Breeze. He stops by to talk
Speaker 3: pricing and more. We also take a look at Delta's
Speaker 3: results and the revival of business travel.
Speaker 1: Also ahead, speaking of the sky, the eclipse. Did you
Speaker 1: see it, Carol?
Speaker 3: I did, courtesy of the NASA livestream.
Speaker 1: Okay, well, live stream was pretty cool. I actually got
Speaker 1: to venture outside, as did millions of Americans. Some thirty
Speaker 1: million people live in the path of totality. That's according
Speaker 1: to NASA, and lots more got to check it out.
Speaker 1: We had people traveling from all over to the path
Speaker 1: of totality to check out the eclipse. Maybe you'll be
Speaker 1: able to view the next eclipse though from way up
Speaker 1: in the sky. Very cool on a space balloon. How
Speaker 1: does that sound even cooler? Okay, we're gonna explain how
Speaker 1: you can do that with the co founder and co
Speaker 1: CEO of Space Perspective Gene Pointers.
Speaker 3: Sign me up, plus the top ten global stocks to watch,
Speaker 3: and a double dose of golf the putter used by
Speaker 3: Tiger Woods and others that's turned a brand into an
Speaker 3: asset class and the on again, off again, on again
Speaker 3: trauma of the PGA Tour and live golf.
Speaker 1: All of that to come. We begin with Boeing, though
Speaker 1: some news this week. The company facing a deepening crisis
Speaker 1: of confidence after deliveries in the first quarter dipped the
Speaker 1: lowest since mid twenty twenty one. Also, a longtime Boeing
Speaker 1: engineer alleged that the company took me manufacturing shortcuts on
Speaker 1: its seven eighty seven Dreamliner aircraft.
Speaker 3: Yeah, the woes continue for Boeing, and this also as
Speaker 3: a reminder of how far the plane maker has to
Speaker 3: go on its road to recovery from a near catastrophic
Speaker 3: accident early in January. No doubt major airlines are watching
Speaker 3: for what comes next from Boeing, which brings us to
Speaker 3: an individual well known in the commercial aviation industry, David Nilman.
Speaker 1: David is the founder and CEO of Breeze Airways. He's
Speaker 1: also a disruptor in the space, having founded five airlines,
Speaker 1: including Jet Blue, WestJet, and now Breeze Airways. We got
Speaker 1: his take on Boeing, how summer demand is shaping up,
Speaker 1: and the growth of his newest company.
Speaker 4: We actually made our first profit. We've made a profit
Speaker 4: in March and we expect to be profitable for the year.
Speaker 4: And you know, this is in a year where you know,
Speaker 4: some of the ulccs are really struggling, and you know,
Speaker 4: I'm just really proud of our team. We've really carved
Speaker 4: out at really great niche where people love flying on Breeze,
Speaker 4: They love the airplanes, the service. We have almost two
Speaker 4: hundred routes and ninety percent of them we have no
Speaker 4: NonStop competition, but there are routes of people really love
Speaker 4: to fly, and so that's really, you know, the most
Speaker 4: important thing for us is profitability and continue to grow
Speaker 4: and continuing to find great new markets and maturing the
Speaker 4: markets that we have today.
Speaker 3: So talk to us a little bit about fares holding
Speaker 3: up in this class. I mean, it feels like there
Speaker 3: are a lot of budget seats in the market. I mean,
Speaker 3: talk to us a little bit about fares and pricing
Speaker 3: and summer demand. How you're starting to see that shape up.
Speaker 4: Well, it's good. I mean we had a good first quarter.
Speaker 4: You know, it was interesting. We did more revenue in
Speaker 4: March than we did the whole first quarter of last year.
Speaker 4: Kind of shows you our growth. April looks good. You know,
Speaker 4: May is May. It's a bit of a transition month
Speaker 4: where we move a lot of our north south flying
Speaker 4: to east west. So you know, May looks pretty good,
Speaker 4: and then June summer looks strong and you know, holding
Speaker 4: our projections for a profitable years. So you know, it's
Speaker 4: interesting because we have kind of a base fair that's
Speaker 4: you know, kind of like a basic economy that everybody
Speaker 4: else has, and then the jump ups where you go
Speaker 4: from the nice nicer to nicest where you get into
Speaker 4: a first class seat.
Speaker 2: Isn't that bad?
Speaker 5: And people love it.
Speaker 1: May David, I'm interested in the fleet airbus A two
Speaker 1: twenties Embraer, one nineties and one ninety fives. How are
Speaker 1: you able to survive with such a small airplane when
Speaker 1: it seems like everybody else is increasing the size of
Speaker 1: the planes that they're using to offset those higher pilot salaries.
Speaker 4: That's a great question, It's a really great question. So
Speaker 4: the Embryers we use primarily for charters. We do have
Speaker 4: a little bit of schedule service with them, and they're
Speaker 4: going away by the end of this year, and it'll
Speaker 4: be all two twenties the one nineties. In the month
Speaker 4: of March, we did almost six hundred charters that we flew,
Speaker 4: you know, for NCAA, March Madness.
Speaker 5: And all of that.
Speaker 4: So we use those planes primarily for that operation, and
Speaker 4: our pilots and flight crews do a great job. Now
Speaker 4: the two twenty you're right, I mean, pilot salaries have
Speaker 4: gone up, and fortunately the pilot shortage situation in the
Speaker 4: US has really gotten better, much much better, you know,
Speaker 4: with with pilots getting ready to be laid off at
Speaker 4: some airlines and a lot of airlines not hiring and
Speaker 4: a lot of that's because of buoying deliveries, but because
Speaker 4: the two twenties so efficient on fuel burn and maintenance costs.
Speaker 4: You know, we only have one hundred and thirty seven seats,
Speaker 4: and our trip cost, we believe is about twenty percent lower,
Speaker 4: fifteen to twenty percent lower than a three twenty and
Speaker 4: a lot of our competitors fly a three twenties, you know,
Speaker 4: be it Spirit or Frontier or Allegiant or Jeff Blue.
Speaker 4: So we can fly for twenty percent lower, and that
Speaker 4: just opens up an exponential amount of routes that we
Speaker 4: can fly because we have lower trip costs, because the
Speaker 4: plane is new and it's efficient, and you know, has
Speaker 4: these long ranges, so we can do these long, thin
Speaker 4: routes as well. So you know, yeah, I mean what
Speaker 4: Spirits I think is really struggling trying to figure out
Speaker 4: what do I do with a two hundred and forty
Speaker 4: seed airplane. I got a fly where everybody else is
Speaker 4: and you know the other everybody else is not, you know,
Speaker 4: being kind of late to them where eighty percent of
Speaker 4: their routes they have NonStop competition. Ninety percent of our
Speaker 4: routes we have known on sub competition.
Speaker 3: You know, David, You've used Airbus planes a lot in
Speaker 3: your timeline and creation of five different carriers, if you will,
Speaker 3: And you had the Airbus three twenties, right, a big
Speaker 3: part of Jet Blue back then. I'm just curious what
Speaker 3: you make of what's going on with Boeing in trouble again,
Speaker 3: if you will. And you know it's a duopoly, right,
Speaker 3: it's either Airbus or Bowing at this point. But I'm
Speaker 3: just curious how you were thinking about Boeing in its
Speaker 3: future here, and why don't you choose more Boeings.
Speaker 4: My first airline more Sarah had Boyings and I love Boying,
Speaker 4: and I went up to Boying and was fully intent
Speaker 4: on buying seven thirty seven's for Jet Blue. We couldn't
Speaker 4: come to an agreement, so we went and met with Airbus.
Speaker 4: Airbus just sold me that they had a better product,
Speaker 4: a better airplane now, better, our customers would love it more,
Speaker 4: you know, fly by wire or just so many other advantages,
Speaker 4: better fuel burn, and it was just a newer technology.
Speaker 4: It was a newer technology airplane. So I picked Airbus
Speaker 4: at that time. Now, the reason I picked it wasn't
Speaker 4: because of safety. It was just because it was a
Speaker 4: better airplane for US, and it was a better airplane
Speaker 4: for our customers.
Speaker 5: I find seven thirty seven's.
Speaker 6: On a weekly basis.
Speaker 4: They just got off a United seven thirty seven last week.
Speaker 4: I feel one percent safe. I have total confidence in Boeing.
Speaker 4: Obviously they're going through a rough patch here, you know,
Speaker 4: but there's the safety record in the United States for
Speaker 4: all commercial carriers is unbelievable. I mean, if you look back,
Speaker 4: it's hard to find the last major accident by a
Speaker 4: Boying airplane, you know, in the United States, and it's
Speaker 4: really difficult. So my heart goes out to Boying. I
Speaker 4: know they're going through it. I know that this will
Speaker 4: make them a better company, and I expect them to
Speaker 4: come out of it stronger than ever.
Speaker 1: That was the founder and CEO of Breeze Airways, David Neilman.
Speaker 3: While we're talking about airlines Delta this week, even earnings
Speaker 3: outlook that top to Wall Street estimates thanks to a
Speaker 3: step up in corporate travel and steady leisure demand heading
Speaker 3: into summer. The stock came under though some pressure following
Speaker 3: those results, as did the overall airlines group. Following us
Speaker 3: it's inflation data that showed airfares dropped seven point one
Speaker 3: percent in March from the prior year. That tim was
Speaker 3: the biggest decrease since November bottom line.
Speaker 1: We wanted to hear more about Delta, and so we
Speaker 1: checked in with Bloomberg News US airlines reporter Mary Schlangenstein.
Speaker 7: What Delta talked about primarily was one that their operations,
Speaker 7: their flight operations have really improved this year, and they're
Speaker 7: not alone in doing that. There hasn't been a lot
Speaker 7: of bad weather, and a lot of the airlines were
Speaker 7: performing better operationally. But they're also talking about a big
Speaker 7: factor being the return of some of the corporate travel
Speaker 7: accounts that were lagging. The areas that were lagging like
Speaker 7: tech and financial services, they're finally seeing those companies come back,
Speaker 7: so that managed corporate travel revenue is back to twenty
Speaker 7: nineteen levels. Volumes are still lagging, but the revenue is
Speaker 7: returned to twenty nineteen.
Speaker 1: Remind us Mary about where Delta gets its revenue mix
Speaker 1: in terms of domestic versus international.
Speaker 7: Here, Yeah, they're still more heavily domestic. But the differentiator
Speaker 7: for Delta is so much of their revenue comes from
Speaker 7: premium products. So in the first quarter, their premium product
Speaker 7: revenue rows ten percent, main cabin only rows four percent,
Speaker 7: and that's been a pretty consistent thing for them. They
Speaker 7: really focus on that premium customer and their cells have
Speaker 7: been leaning more toward that area for some time.
Speaker 1: But since they're more heavily domestic, how much were they
Speaker 1: affected by a slowdown into potential slow down in domestic
Speaker 1: travel and an increase of late in international travel.
Speaker 7: So international travel has been really strong since last year,
Speaker 7: and Delta saying it continues to be really strong, even
Speaker 7: across the Atlantic, where there were concerns early on that
Speaker 7: there was too much capacity in that market this year,
Speaker 7: but Delta says there's plenty of demand. They see demand
Speaker 7: strong to the Pacific and Latin America. Domestically, they're saying
Speaker 7: demands picked up too. They're picking up some travel, they
Speaker 7: think from the domestic focus carriers that are having to
Speaker 7: rejuggle their schedules and redo their operating scheduled because of
Speaker 7: some conditions specific to the domestic market.
Speaker 1: You're talking about Boeing or Spirit.
Speaker 7: We're talking about domestic focus carriers like Spirit, Allegiant, even
Speaker 7: Jet Blue to some expensis.
Speaker 3: Okay, Hey, Mary, one thing I wanted to ask you.
Speaker 3: The CEO at Baston saying in your story that you
Speaker 3: noted is that while revenue acceleration has brought the carrier
Speaker 3: back fully to twenty nineteen levels, you just said that
Speaker 3: earlier volume remains eighty five to ninety percent of pre
Speaker 3: pandemic levels. Does that mean so Yay Delta has more
Speaker 3: of a runway to kind of grow that and grow
Speaker 3: the revenue line or is it? How are I don't know.
Speaker 3: How is the industry rethinking about the levels that were
Speaker 3: pre pandemic and where we are do we go back
Speaker 3: to those levels at some point?
Speaker 7: Well, on business travel in particular, I think that they
Speaker 7: believe that there's some segment of that volume that's just
Speaker 7: not going to come back because they're still seeing, you know,
Speaker 7: a permanency to some of the change travel patterns where
Speaker 7: people are taking you know, to blend leisure travel andsiness travel.
Speaker 7: So their business trip may be longer, they maybe aren't
Speaker 7: traveling as frequently as they did before. So I think
Speaker 7: part of the volume is always going to be gone.
Speaker 7: I think the revenue even on non business travel has
Speaker 7: exceeded twenty nineteen levels already, and so as the volume
Speaker 7: for leisure travel.
Speaker 1: Mary my head is on the equipment providers Airbus, Bowing
Speaker 1: and Braier Bambardier, all of which provide aircraft to Delta.
Speaker 1: I'm wondering, since it does have a mixed fleet, was
Speaker 1: was there any commentary about Boeing on the call?
Speaker 7: Not a lot. You know, Delta does primarily fly Boeing aircraft.
Speaker 7: They don't currently fly the Max. They have the Max
Speaker 7: ten on order, but they don't expect to receive that
Speaker 7: for about three years yet. But what CEO ed Baston
Speaker 7: did say was that you know, safety is a top
Speaker 7: priority across the industry and that every day, you know,
Speaker 7: that's the top priority for every airline. So he didn't
Speaker 7: comment specifically on Boeing, and he didn't comment specifically on
Speaker 7: the safety incidents that have been currying cross the industry recently,
Speaker 7: but just said that's a top priority.
Speaker 5: He did say in an.
Speaker 7: Interview I had with him yesterday that he knows the
Speaker 7: new chairman at Boeing is familiar with him, and he
Speaker 7: expects that at some point he will talk to him
Speaker 7: about any concerns about Boeing itself.
Speaker 1: Has there been any chatter about them changing their order
Speaker 1: of those new Max planes that have not yet been
Speaker 1: delivered to Airbus if that isn't even a possibility given
Speaker 1: the airbus supply constraints.
Speaker 7: They just placed that order recently, they haven't had it
Speaker 7: for very long, and I don't think there's any consideration
Speaker 7: at this point. The deliveries are due farther out. That
Speaker 7: gives plenty of time for the Max ten to be
Speaker 7: certified before their deliveries come up, and even for Delta
Speaker 7: for Boeing to catch up on some production. So I
Speaker 7: don't think that's being considered right now.
Speaker 1: That's Bloomberg News US Airlines reporter Mary Schlangenstein coming up.
Speaker 3: Sure, you could get on a plane, but how about
Speaker 3: floating up into Earth's upper atmosphere at a cool twelve
Speaker 3: miles per hour via a ship launched balloon.
Speaker 1: What do you think? Maybe a nice little glass of
Speaker 1: champagne to go along with it? Well, the co founder
Speaker 1: and co CEO Space PERSPECTI coming up next. You're listening
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Speaker 1: Bloomberg Business Week podcast. Catch us live weekday afternoons from
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Speaker 1: and and Brout Auto with a Bloomberg Business act or
Speaker 1: watched us live on.
Speaker 3: YouTube this past Monday, millions across North America took a
Speaker 3: break from whatever they were doing to stare up at
Speaker 3: the sky and take in in person, possibly a once
Speaker 3: in a lifetime cosmic wonder, a total solar eclipse. And Tim,
Speaker 3: you even left the studio to give us a live
Speaker 3: report while it was happening. I mean, I got to
Speaker 3: say you were giddy kind of leading up into it.
Speaker 1: Yeah, it was pretty excited. I mean I have memories
Speaker 1: from when I was a little kid, probably five or
Speaker 1: six years old, checking out the eclipse at summer camp
Speaker 1: with those boxes.
Speaker 3: Yeah, like we used to make right with the holes
Speaker 3: and like.
Speaker 1: I don't know, yeah, the whole projectors right. Unfortunately, New
Speaker 1: York City was overcome by a massive cloud during most
Speaker 1: of the eclipse. However, it's still was pretty cool all right.
Speaker 3: Even rarer but hoping to become more common, is floating
Speaker 3: up into Earth's upper atmosphere at a cool twelve miles
Speaker 3: per hour. It all happens on a ship launched balloon
Speaker 3: in a sixteen foot spherical capsule up to one hundred
Speaker 3: thousand feet. I mean, Tim, forget about watching, Like we said,
Speaker 3: the next eclipse from New York. How about taking a
Speaker 3: tour to space itself.
Speaker 1: Yeah, okay, it could potentially become a reality. It's going
Speaker 1: to cost you though, one hundred and twenty five thousand dollars.
Speaker 1: After three hours, though, you'll be able to look out
Speaker 1: the windows and see something very few people have been
Speaker 1: able to see, large portions of land and sea, the
Speaker 1: rimmed curvature of the Earth, and of course millions of stars.
Speaker 1: That's all part of the experienced Space Perspective is looking
Speaker 1: to provide. So for more on this, we checked in
Speaker 1: with the co founder and co CEO Space Perspective, Jane Pointer.
Speaker 8: We are wanting to take as many people as possible
Speaker 8: to space. Only six hundred and fifty people have ever
Speaker 8: been to space and the entire history of humanity, which
Speaker 8: is kind of crazy to think about.
Speaker 1: And that that includes people like Jeff Bezos who've gone
Speaker 1: via Blue Origin.
Speaker 3: Or Neil Armstrong or Neil Yeah, yeah, yeah.
Speaker 8: That includes everybody, Yeah, everybody.
Speaker 1: Would you do you can number of people do you
Speaker 1: consider one hundred thousand feet above earth space?
Speaker 7: Oh?
Speaker 8: Yeah, actually so, I mean, look, it's an interesting question.
Speaker 5: There really is no universal definition of space.
Speaker 8: Actually, and we, as you said, we are above ninety
Speaker 8: nine percent of the atmosphere. That last one percent stretches
Speaker 8: way past the International Space Station.
Speaker 5: So in as it is a.
Speaker 8: Space environment, it's a vacuum outside the enormous windows we
Speaker 8: fly to space, and then we're also regulated by the
Speaker 8: FAA's Office of Commercial Space Transportation as a spacecraft. So yeah,
Speaker 8: we're we're definitely in space. You could say we're at
Speaker 8: the edge of space.
Speaker 1: But what would you say to critics? You say, Okay,
Speaker 1: we actually think and like, again, there's no universal definition
Speaker 1: of it. But critics might say, Okay, we think it's
Speaker 1: one hundred kilometers above Earth, we think it's three hundred arbitrary.
Speaker 8: Yeah, no, I mean, look, it's a little arbitrary. And
Speaker 8: the most important thing is that what our customers are
Speaker 8: getting is access to that quintessential astronaut experience of seeing
Speaker 8: us from space. I mean, that is what's important, and
Speaker 8: that's what we're offering, and we're offering it in a
Speaker 8: way that is really accessible, right. I Mean, when most
Speaker 8: people think about spaceflight, they think about rockets, they think
Speaker 8: about the high g forces that some describers like having
Speaker 8: an elephant sitting on your chest, or the you know,
Speaker 8: the constricting spacesuits, the training, the uncomfortable capsule. I mean,
Speaker 8: let's face it, it may be thrilling for those who
Speaker 8: want that kind of thing, but it is not very comfortable.
Speaker 8: You're not going to take your family or your grandma
Speaker 8: on a rocket to space. For the most part. However,
Speaker 8: what we are doing as Space Perspective is a very
Speaker 8: different kind of experience, whereby it truly is something that
Speaker 8: you can take your family on. It's a family friendly
Speaker 8: version of going to space because it's so gentle. And
Speaker 8: then you get that outrageous view seeing our help.
Speaker 3: Me out your work looking at your website. So tell me,
Speaker 3: I'm seeing this white looks like a balloon, I mean,
Speaker 3: tell me how it all works. And are these actually
Speaker 3: up in space yet and tested or give you an idea?
Speaker 8: Yeah, so, yes, what you're seeing there is a space
Speaker 8: balloon at the top, and underneath it is as a
Speaker 8: pressurized capsule. So if you can get on a commercial airplane,
Speaker 8: then you can get on spaceship Neptune. That that is
Speaker 8: the idea of the design. And indeed, many of these
Speaker 8: space balloons have been flown before.
Speaker 5: You know, most people have never heard of them.
Speaker 8: But they've actually been flown over a thousand times by NASA,
Speaker 8: European Space Agency by some of our team members as well,
Speaker 8: and in the last twenty years there have been no
Speaker 8: incident in space. So it's this legacy technology that what's
Speaker 8: technically called a zero pressure balloon that we're using, and
Speaker 8: actually my co founder and I have taken people higher
Speaker 8: than we're going. We've carried capsules larger and heavier than
Speaker 8: in spaceship Neptune, So we've really done every aspect of
Speaker 8: this before. And we did an initial test flight a
Speaker 8: couple of years ago, and now we're getting into a
Speaker 8: full on series of uncrewed test flights with our test
Speaker 8: capsule Excelsior, that is exactly the same as the one
Speaker 8: that we're all going to be flying to space on.
Speaker 3: How does it get into space? What's the proposal?
Speaker 8: So it's buoyancy control, So there's a gas inside the
Speaker 8: balloon that is lighter than the air around it, and
Speaker 8: it literally lifts it up off You mentioned earlier that
Speaker 8: we do laugemanship, so it lifts it up and then
Speaker 8: wants your in space, and you know we've hung out
Speaker 8: and hung at our bar and had your.
Speaker 2: Your meal or whatever it is.
Speaker 8: You're going to do in space, your wedding, your played
Speaker 8: your music. We let out a little bit of gas
Speaker 8: which then brings it very gently back down to the
Speaker 8: ocean for a splash down. So it's exactly the same
Speaker 8: as like For example, some people ask me, doesn't he
Speaker 8: just keep on? Why doesn't he keep on going out
Speaker 8: to space? Think of it like an ice cube floating
Speaker 8: on top of water. The space balloon is literally floating
Speaker 8: on top of the atmosphere.
Speaker 1: So, Jane, one interesting thing about this is that you
Speaker 1: launch from a ship. Why choose to launch from a
Speaker 1: ship in the ocean rather than from dry land.
Speaker 8: Yeah, it was a game changing decision for the company actually,
Speaker 8: So you would think, surely it's easier, less complicated to
Speaker 8: launch from the land. Well, I mean, yes, I suppose,
Speaker 8: But the issue is, just like a rocket launch, there
Speaker 8: are weather sensitivities. So what the ship does for us,
Speaker 8: it does many things. We can move the ship with
Speaker 8: the wind and the direction of the wind, so we
Speaker 8: can create almost perfect launch conditions over the ship in
Speaker 8: really broad operating envelope. We can then move the ship
Speaker 8: to areas of good weather throughout the year. So now
Speaker 8: we've got reliable weather windows all year long, and we
Speaker 8: have this incredibly scalable operation because we can move it
Speaker 8: all over the world. We can also duplicate it very readily,
Speaker 8: and then we can do these spaceflight operations. We're going
Speaker 8: to initially start operating from the Florida region all the
Speaker 8: way around the peninsula in the Caribbean, and then we're
Speaker 8: going to have these same kinds of operations all over
Speaker 8: the world. So it is just completely enabling for the company.
Speaker 3: And you're up actually in I don't know, do I
Speaker 3: say orbit or you're up for about six hours or so.
Speaker 3: That's kind of your your eye.
Speaker 8: So it's just think of it as a suborbital flight.
Speaker 8: And so our initial flights are six hours, so it
Speaker 8: takes about two hours to go up. You're up there
Speaker 8: roughly two hours, and then two hours to come back down.
Speaker 8: And of course we do have thoughts of wouldn't it
Speaker 8: be awesome to do an overnight in space or even
Speaker 8: a couple of nights in space, and we can do
Speaker 8: that with the current technology without without really pushing the
Speaker 8: tech much at all.
Speaker 3: I have a question, though, everything that's on the website,
Speaker 3: is that actual things that have happened, or is that visualizations.
Speaker 5: So there's a bit of both.
Speaker 3: Okay, so there are there's.
Speaker 8: A bunch of renders, right, So the way we visualize
Speaker 8: it for people is to show the renderings of the
Speaker 8: entire of the entire flight. However, last week we did
Speaker 8: actually unveil the completed capsule, and it looks so like
Speaker 8: the render that I actually have to tell people it
Speaker 8: is not rendering, it is the real thing, and we're
Speaker 8: going to be sorry.
Speaker 1: Go ahead, Well, we have a minute left, then we're
Speaker 1: going to do some news. Then we're going to come
Speaker 1: back for some more, but just give us an update
Speaker 1: on the timeline when you actually expect to fly people
Speaker 1: for the first time.
Speaker 8: Right, So we're going to be getting into uncrewed test
Speaker 8: flights just in a few weeks. We're going to do
Speaker 8: roughly ten of those, assuming we get through all the
Speaker 8: safety gates, and then we'll be getting into human test flights,
Speaker 8: crewed test flights around Q three four this year, and
Speaker 8: then getting into commercial flights around the end of the
Speaker 8: year early next.
Speaker 3: Well, it's kind of fascinating to hear this. I want
Speaker 3: to ask you a little bit about your history. You've
Speaker 3: been in this world and doing interesting things for some time.
Speaker 3: But I want to take you back to you were
Speaker 3: actually involved with Worldview, right, a former CEO, so, another
Speaker 3: company in the space that is using balloons to shoot
Speaker 3: people high above the atmosphere, if you will. In December
Speaker 3: of twenty seventeen, they actually had a hydrogen filled balloon
Speaker 3: that exploded at one of their facilities. And so I'm
Speaker 3: just curious, and I know things have been looked into
Speaker 3: and so on and so forth, but I guess the
Speaker 3: use of hydrogen which you guys are using correct today,
Speaker 3: what are the risks in what you are doing? Nothing
Speaker 3: is ever risk free.
Speaker 8: So let me say several things. That accident, or I
Speaker 8: guess the incident, let's call it that that occurred with
Speaker 8: that balloon was it was being used in a way
Speaker 8: that would not normally being used. And I don't want
Speaker 8: to take the time to go into all the technical details,
Speaker 8: but there was a lot of work down to really
Speaker 8: understand what happened there. And it's not anything that would
Speaker 8: be able to happen in the future because we're just
Speaker 8: not using the balloon in that way in the future.
Speaker 8: And of course everybody thinks of the Hindenburg. I mean,
Speaker 8: let's just talk about the real tragedy in the Elephant
Speaker 8: in the room right, While the Hindenburg was eighty five
Speaker 8: years ago, and it was an airship that was designed
Speaker 8: for helium, not for hydrogen, and that is really important
Speaker 8: because hydrogen is only flammable if it is in the
Speaker 8: presence of oxygen. And the way that particular airship was designed,
Speaker 8: the way all the airships are are typically designed, is
Speaker 8: you have a balonet in the center of the airship
Speaker 8: that's filled with the gas. In this case, it was hydrogen,
Speaker 8: and then you have an air gap, and then you
Speaker 8: have the outer skin. While the air gap, everything tends
Speaker 8: to leak, particularly then because it wasn't designed for hydrogen,
Speaker 8: leaked hydrogen into that air gap. So now you've got
Speaker 8: this incredibly flammable mixture of hydrogen and air trapped inside
Speaker 8: this airship. Then the skin of the airship was painted
Speaker 8: in a daub that frankly was a fire starta so
Speaker 8: when it was ignited by a spark from the pole
Speaker 8: that it was sitting on, that ignited the skin, which
Speaker 8: then ignited the flammable gas. Okay, So that obviously would
Speaker 8: never happen if it was actually designed for hydrogen. So
Speaker 8: now let's talk about how they are designed. So since
Speaker 8: the seventeen hundreds balloons have been used. Thousands of balloons
Speaker 8: have been used since the seventeen hundreds all over the world,
Speaker 8: and there isn't a single recorded incident of an accident
Speaker 8: attributed to the hydrogen. And that simply because the hydrogen
Speaker 8: is inside the balloon and if there is any leakage,
Speaker 8: it just goes out the top and goes straight up.
Speaker 8: There's nowhere effort to go that can get trapped. And
Speaker 8: so you know, for us, it's a very if you
Speaker 8: know how to handle it, and people all over the
Speaker 8: world use it. It's a very safe way to go.
Speaker 8: It's actually a better lift gas than helium, which is
Speaker 8: in such the other the other lift gas, and that
Speaker 8: is in such short supply now that Noah uses hydrogen
Speaker 8: in all of their weather balloons.
Speaker 1: Now that was Gene Pointer, the co founder and co
Speaker 1: CEO of Space Perspective.
Speaker 3: All right back down to Earth we go, and the
Speaker 3: reality is for a bit or for worse, are the
Speaker 3: Thames tucks to watch? It's all coming up. This is Bloomberg.
Speaker 2: You're listening to the Bloomberg Business Week podcast. Listen live
Speaker 2: each weekday starting at two pm Easter on Applecar Play
Speaker 2: and Android Auto with the bloom Where Business app. You
Speaker 2: can also listen live on Amazon Alexa from our flagship
Speaker 2: New York station, Jo Say Alexa Play Bloomberg eleven thirty.
Speaker 3: All right, Tim, So what happens when our Bloomberg Intelligence
Speaker 3: analysts sort through the barrel to find the good apples
Speaker 3: across sectors and regions a group of companies that come
Speaker 3: from a larger group of high confidence focus ideas that
Speaker 3: BI identifies on an ongoing basis. Do you know what happens?
Speaker 1: I know what happens, because well I prepared for the
Speaker 1: segment you did. But what they do is they come
Speaker 1: up with, at least this time around the ten companies
Speaker 1: to watch in the second quarter. This story featured in
Speaker 1: the new issue of BusinessWeek magazines, available on news stands,
Speaker 1: on the Bloomberg terminal and at Bloomberg dot com slash business.
Speaker 3: All right, so let's get more on those ten companies.
Speaker 3: Back with us, Bloomberg Intelligence Senior European strategist and Director
Speaker 3: of Research Content, Tim craig Head. He is joining us
Speaker 3: from London.
Speaker 5: Tim.
Speaker 3: We always love going through these lists with you, so
Speaker 3: take it away. We kind of set it up. Is
Speaker 3: there anything we need, anything else we need to know?
Speaker 3: Is how you guys curated this list.
Speaker 5: Thanks for having me on. And yeah, I would say
Speaker 5: that one of the things that happens when we come
Speaker 5: up and do these sort of things is that the
Speaker 5: Business Week folks come up with some really cool graphics
Speaker 5: in the in the magazine and in particular if you
Speaker 5: look at it on the online version. But the device
Speaker 5: to say, from Bloomberg Intelligences perspective, this list of ten
Speaker 5: you refer to, it is part of a broader list
Speaker 5: of what we call focus ideas, and the focus ideas
Speaker 5: are companies where we've got a very strong fundamental view,
Speaker 5: a high conviction view that we think is differentiated from
Speaker 5: the market and what the market seems to be discounting,
Speaker 5: you know, as it relates to the stocks and whatnot.
Speaker 5: And importantly, there's a catalyst ahead that we think can
Speaker 5: change the market's point of view assuming we're correct. And importantly,
Speaker 5: with these ten companies that we focused on here, they
Speaker 5: all have really key catalysts coming up for the second quarter,
Speaker 5: and that's why we pick these. There's two of them
Speaker 5: that are cautious views. There's eight of them that are
Speaker 5: positive views, they span sectors, they span regions, and yeah,
Speaker 5: that's the setup.
Speaker 1: Okay, So let's talk about some of those sectors. I
Speaker 1: want to start with tech in innovation because a couple
Speaker 1: and these are not. I would argue that not every
Speaker 1: one of these companies on here is a household name,
Speaker 1: and certainly some of them are on the smaller side.
Speaker 1: So talk about what you found in tech and innovation
Speaker 1: with the team found there.
Speaker 5: Yeah. Absolutely. So you know, there's an awful lot going
Speaker 5: on in the world of technology these days about AI.
Speaker 5: You can't not talk about it. And there's two companies
Speaker 5: here that we've got on the list that are related
Speaker 5: to artificial intelligence. One is Salesforce, which is the world's
Speaker 5: largest infrastructure software company. And notwithstanding how big this company is,
Speaker 5: it still actually may not be a household name given
Speaker 5: the nature of the beast. Importantly, any company that is
Speaker 5: looking at all the information they get from their customers
Speaker 5: probably relies on Salesforce and their software programs, and they're
Speaker 5: going through two things right now. One is a big
Speaker 5: tech infrastructure software spending cycle that we think is gaining momentum,
Speaker 5: and then secondly, it's the need for information to feed
Speaker 5: AI programs and initiatives and salesforce is right smack in
Speaker 5: the middle of all of this. The other one is
Speaker 5: a company called ten Cent, and if you're in China,
Speaker 5: you definitely know about ten Cent. It has a lot
Speaker 5: of things going on within the world of online gaming. Importantly,
Speaker 5: from our perspective, they've gotten into short videos and AI
Speaker 5: is enhancing the way that they're generating revenue from advertising.
Speaker 5: Both of those are feeding ten Cents business that we
Speaker 5: think is underappreciated by the market. The last one I
Speaker 5: would mention is a company not in the world of
Speaker 5: classic tech, but technology in the world of medicine. A
Speaker 5: company called Penumbra.
Speaker 1: That's when I was thinking of when I say, not
Speaker 1: a household man exactly.
Speaker 5: So, these guys make computer assisted vacuum technology products, and
Speaker 5: you say, what is that. Think blood plots and usually
Speaker 5: the way you treat blood clots is with anti coagulate drugs,
Speaker 5: and they've got all sorts of other ramifications. Penumbra's computer
Speaker 5: assisted vacuum technology can go in and actually suck blood
Speaker 5: plots out of auteries and veins, even really small wins,
Speaker 5: and you don't have to take the drugs. It's great
Speaker 5: and again all three of these we think could generate
Speaker 5: better than anticipated revenue, margins, earnings.
Speaker 3: And I just want to mention when you talked about Salesforce,
Speaker 3: we actually spoke with Alie stein Glass, executive EP Gentlemen
Speaker 3: manager over at Salesforce, and they talked about the role
Speaker 3: of jen Ai and the role of data and making
Speaker 3: it ready for their customers. So she kind of got
Speaker 3: into some of the growth initiatives that you that you
Speaker 3: referred to. Another theme we want to touch on, and
Speaker 3: that has to do with actually two Chinese companies walk
Speaker 3: us through that.
Speaker 5: Yeah, so China is certainly having its challenges. I think
Speaker 5: you still are clearly very well aware of what's going
Speaker 5: on in the world of Chinese property. It's definitely under
Speaker 5: pressure on all sorts of different fronts, and there's also
Speaker 5: other issues. The stock market has fallen and whatnot. There's
Speaker 5: regulatory measures that are being put in place to try
Speaker 5: to curtail some of these problems and change the course.
Speaker 5: Part of those are actually putting a damper on what's
Speaker 5: going on in the world of initial public offerings and
Speaker 5: secondary market offerings in the stock market. And CSC Financial
Speaker 5: is one of China's biggest brokerage firms, and we think
Speaker 5: that they are due to disappoint through the first half
Speaker 5: of the year because of this. Another one is a
Speaker 5: company called chow Tai Fook. It's based in Hong Kong.
Speaker 5: It's the biggest Hong Kong based China jeweler retail company.
Speaker 5: If you're in Hong Kong, yeah, definitely no Chata Fook.
Speaker 5: And it's interesting because not only is there a negative
Speaker 5: effect because of what's going on with property and consumer
Speaker 5: sentiment on jewelry purchases, but Hong konger specifically are going
Speaker 5: to find things cheaper on the mainland, They're going across
Speaker 5: the border, and all of this we think is driving
Speaker 5: a disappointing trend for Hong Kong retail sales. In Childtai
Speaker 5: book is a poster child for this. So both of
Speaker 5: those are concerns.
Speaker 3: As you said, great illustrations by the Bloomberg Business Week team.
Speaker 3: It's all about apples, and these apples are a little
Speaker 3: bit bruised, so kind of fun to see that go along.
Speaker 3: We've got another sector.
Speaker 1: Yeah, I want to talk construction. Here some interesting names
Speaker 1: from the Blueger Intelligence team talking about potential beneficiaries of
Speaker 1: a construction boom. What do if you find.
Speaker 5: Tim Well, So, Taylor Morrison is a home builder and
Speaker 5: they're ones that focus on larger communities. They've got more
Speaker 5: and more growth coming from Arizona and Florida, and we
Speaker 5: think that there's an opportunity to see better margin improvement
Speaker 5: given the way that they're driving their business pure and simple.
Speaker 5: Oshkosh is more on the bigger commercial side, and it's
Speaker 5: not only instruction, but they also do other commercial vehicles
Speaker 5: like fire trucks or ambulances or the new postal service
Speaker 5: electric vehicle, so all sorts of projects there. But generally
Speaker 5: there's concern that on that commercial side that there's a downcycle.
Speaker 5: Actually that's that's developing, and we think Oshkosh is going
Speaker 5: to be able to actually surprise on the positive because
Speaker 5: that's such a big backlog and some of these new
Speaker 5: initiatives that are playing through to the revenue stream.
Speaker 3: All Right, finally, sector we love to talk about in
Speaker 3: travel and you got two names in that walk us
Speaker 3: through those two. A Core is one of them.
Speaker 5: Yes, so there's one that's absolutely classic travel and the
Speaker 5: other I'm stretching things a little bit by suggesting travel.
Speaker 1: So the mission was created for a reason.
Speaker 3: There you go, we're helping you out.
Speaker 5: Yeah. So, Acor is a hotel company, and I think
Speaker 5: a lot of the listeners here are probably stayed at
Speaker 5: one of their hotels. They go from the very high
Speaker 5: end to more modest economy brands. The thing that anybody
Speaker 5: who stayed in an hotel recently is probably found is
Speaker 5: how expensive it is. You know, it's pretty shocking sometimes
Speaker 5: what the rates are that you have to pay. That's
Speaker 5: feeding Acor's revenue. There is a global travel cycle that
Speaker 5: we think is stronger and longer, and Acor is in
Speaker 5: the front of that, both from a europe and an
Speaker 5: Asian travel base. Interesting they are French, their home is
Speaker 5: in France, and you know, it's only a small part
Speaker 5: of their overall portfolio. But the Paris Olympics this summer
Speaker 5: are the catalyst we're looking for because pretty soon we're
Speaker 5: going to start to see the early bookings that they
Speaker 5: release in terms of the Paris Olympics, and it should
Speaker 5: be quite robust.
Speaker 3: The other one twenty seconds though, Yeah, go ahead.
Speaker 5: Yes, Parelli, it's a tire company, and yes you have
Speaker 5: to travel if you get in your car and you
Speaker 5: spend those tires. They are moving in a production basis
Speaker 5: to Mexico and Romania. It's cheaper and they're curtailing the
Speaker 5: low end of their tires to high end, and so
Speaker 5: there's an upgrade cycle. We think both of those can
Speaker 5: create positive surprise.
Speaker 1: This is not the F one tire that we're talking
Speaker 1: about specific.
Speaker 5: It is the F one partly tire.
Speaker 3: Yes, okay, always love these lists. Names that we know,
Speaker 3: names that we don't, but definitely you give us the
Speaker 3: reasons to keep mona radar. So appreciate it. Tim Tank,
Speaker 3: thank you so much. Bloomberg Intelligence, Senior European Strategist, Director
Speaker 3: of Research Content. Our own Tim Craighead joining us there
Speaker 3: from London.
Speaker 2: You're listening to the Bloomberg Business Week podcast. Catch us
Speaker 2: live weekday afternoons from two to five pm Eastern Listen
Speaker 2: on Apple car Play and and Brout Auto with a
Speaker 2: Bloomberg Business app, or watch us live on YouTube.
Speaker 3: Plenty ahead in our second hour of the weekend edition
Speaker 3: of Bloomberg Business Week. Well, the Master's at Augusta currently underway,
Speaker 3: and so we look at the on again, off again
Speaker 3: drama between the PGA Tour and Live Golf involving lots
Speaker 3: and lots of money, geopolitics, courtroom battles, and even some
Speaker 3: high profile trash talking up on Capitol Hill.
Speaker 1: Trash talking on Capitol Hill, it can happen. It can happen. Also,
Speaker 1: from the world of golf, the importance of what golfers
Speaker 1: called the flat stick and the pursuit of the right
Speaker 1: putter at almost any price. We've got the brand that
Speaker 1: is turning a piece of golfing equipment into a two
Speaker 1: hundred thousand dollars asset class.
Speaker 3: Plus Michelin's top hotels in France, how decaf became the
Speaker 3: hottest thing in coffee and tim some great news for
Speaker 3: US New Yorkers. Our local airports are no longer the
Speaker 3: worst in the nation. Come on, have you walked through
Speaker 3: some of them?
Speaker 5: They're yeah, cool.
Speaker 1: It's actually one of my favorite things when people come
Speaker 1: to visit us and they say, Loogrdia is so nice.
Speaker 3: It's pretty amazing.
Speaker 1: It's pretty amaze.
Speaker 3: It's a little long walk to get to places, but
Speaker 3: it's kind of a lovely nice walk.
Speaker 7: Yeah.
Speaker 1: You get to look at planes the whole time.
Speaker 3: And I got to say Newark, which has been, i mean,
Speaker 3: the target of so much, you know, it's not just
Speaker 3: about the turnbike, but Newark Airport everybody makes fun of,
Speaker 3: but you come off. The first time I came off
Speaker 3: in Terminal A after it was redone, it was like
Speaker 3: where am I Okay?
Speaker 1: Well it depends on the terminal it does, and this
Speaker 1: is they're still Aroundovan.
Speaker 3: Well, this is what the story kind of gets into,
Speaker 3: is this process that it's not all done yet?
Speaker 1: Can they do the subways next?
Speaker 3: Don't hold your breath first up this hour. Though she's
Speaker 3: an Australian cattle dog, she's become a two billion dollar
Speaker 3: smash hit and now she is facing an existential crossroad. Tim,
Speaker 3: we're talking about one of your favorite shows. I'm guessing
Speaker 3: you watch it a lot at home, specifically maybe your
Speaker 3: kid's favorite show, although I think you probably like it
Speaker 3: a lot. We're talking about Blue Yeah.
Speaker 1: I think the thing that people love about Bluie is
Speaker 1: it's as good for parents as it is for kids.
Speaker 1: The episodes are so short, so you can tell your
Speaker 1: kid that they can watch two episodes and it's like
Speaker 1: over in fifteen minutes. I mean, what's not to love
Speaker 1: about Bluie.
Speaker 3: I gotta say I missed it with my daughter, and
Speaker 3: I think it's like this generation of kids, this is
Speaker 3: who they're really watching.
Speaker 1: You know what, when she gets back from college, you
Speaker 1: guys can watch a few episodes together.
Speaker 3: All right, I'm gonna put it on our to do list.
Speaker 1: Well, if you're a parent of kids of a certain age,
Speaker 1: then the TV show blue He needs no introduction. Like Tim,
Speaker 1: You've probably seen it, you probably love it, and you're
Speaker 1: more than happy to pay Disney plus each month to
Speaker 1: keep those episodes streaming. As Devin Leonard writes for Bloomberg BusinessWeek,
Speaker 1: it's quote a show that's both hilarious and deeply moving,
Speaker 1: and its portrayal of how children come to terms with
Speaker 1: the world by playing games, and how parents can foster
Speaker 1: this by joining the fun, no matter how wacky it becomes.
Speaker 1: Devin Leonard is a Bloomberg Business Week Senior Global Business Writer.
Speaker 1: His story the cover of the new issue of Bloomberg
Speaker 1: BusinessWeek magazine. It's available on newstands, on the Bloomberg and
Speaker 1: at Bloomberg dot com slash BusinessWeek. Devin, I can't tell
Speaker 1: you how to let it. I was to see that
Speaker 1: Bluey got the cover treatment. He was like off the
Speaker 1: chair I heard this was happening. I was like, I
Speaker 1: cannot wait to do this, but give us an idea
Speaker 1: of how this story came together, you know.
Speaker 9: Something Hermant who's one of the editors, she asked me
Speaker 9: to do it while I was in the midst of
Speaker 9: some piece about Sean Diddy Combs and his demise, and
Speaker 9: you know, it's kind of like, you know, I was
Speaker 9: just like, yeah, sure, because I like to take assignments.
Speaker 9: I had never heard of this show. I'd never watched
Speaker 9: the show, and and frankly, all I knew was that
Speaker 9: it was I thought it was a Disney show, which
Speaker 9: it isn't even a Disney show. It's just it's just
Speaker 9: a show they license. But I started watching for them. Yeah,
Speaker 9: well I not sound likely for them, but no, I
Speaker 9: just you know, I started watching it and really really
Speaker 9: got into it. And then I realized actually the people
Speaker 9: who were who were you know, were really sort of
Speaker 9: handling the licensing and the merchandising, well you know, it
Speaker 9: was actually BBC Studios, the commercial arm of the BBC.
Speaker 9: So I started talking to them, and you know, I
Speaker 9: was going to go to London. Was I going to
Speaker 9: go to Brisbane, Australia? Why I wanted up going into Brisbane, Australia,
Speaker 9: where I also met along with you know, some of
Speaker 9: the top people from BBC Studios, Joe brom the show's creator,
Speaker 9: and also the founders of Luda Studio, who produced it.
Speaker 9: So it's a whole you know, kind of kind of
Speaker 9: a you know, amazing thing culminating the trip you know,
Speaker 9: last month.
Speaker 3: So all right, because you know how popular it is,
Speaker 3: because you watch it a lot, and I think if
Speaker 3: my daughter was much younger, we would be watching it.
Speaker 9: I'm taking my kids to watch them. Hey, hey, hey,
Speaker 9: you got to check this out.
Speaker 3: Well, the funny thing is it's not just appealing to kids,
Speaker 3: but talk to us about how popular it is.
Speaker 9: Well, I mean it's it's not just the most streamed
Speaker 9: kids show in the US last year, it's the second
Speaker 9: most stream show period after Suits Amazing and Suits as
Speaker 9: nine seasons of episodes that are about you know, almost
Speaker 9: like forty two minutes long. I mean, that's the whole thing.
Speaker 9: You know, lots you get lots of streaming numbers for
Speaker 9: you know, if you have lots of episodes. Blue has
Speaker 9: one hundred and fifty episodes. They're only seven minutes long,
Speaker 9: and it's just just three seasons and yet you know,
Speaker 9: you know, people are watching more Blue than you know,
Speaker 9: than Friends, than gilmore Girls than you know n cis
Speaker 9: so so you know, you know, I mean, I mean
Speaker 9: that you know, there's there's something going on. You're you know,
Speaker 9: you know, something really crazy with you know, with the
Speaker 9: It's not just kids watching it, you know, it's it's
Speaker 9: a lot of other people too.
Speaker 1: You know what's interesting in your piece that I had
Speaker 1: no there was. I learned so much in the piece.
Speaker 1: I encourage everybody to read it, even if you've never
Speaker 1: heard of this show. What I found fascinating was this
Speaker 1: wasn't something that was set to be a hit from
Speaker 1: the pilot. I mean, this is not following the formula
Speaker 1: of the typic cool kids show by any means. This
Speaker 1: is not cookie cutter, right.
Speaker 9: Well, no, that's the crazy, that's the crazy thing. You
Speaker 9: have this guy, you know, Joe Brown, he's forty six
Speaker 9: years old. You know, he lives in Brisbane and you
Speaker 9: know that's where he went to high school. He spent
Speaker 9: some time in London as an animator, you know, worked
Speaker 9: on some shows on the BBC. He came back to
Speaker 9: you know, Australia had a sort of a little animation
Speaker 9: company that he was running for a while out of
Speaker 9: his house, and he kind of missed, you know, being
Speaker 9: around a big crew. So he was sort of like, well,
Speaker 9: if I'm going to have that again, I need to
Speaker 9: create a show, my own show, because that's probably the
Speaker 9: only way it's going to happen. So it's like, well,
Speaker 9: what's that show going to be? And he liked Peppa Pig,
Speaker 9: but he was like, you know, I couldn't he could
Speaker 9: you know, he couldn't rip off Peppa Pig, you know,
Speaker 9: you know, and do you know that's like Peppa Pig's
Speaker 9: family or pigs and all the other families or other species.
Speaker 9: So he's like, okay, so I'll make a show about dogs,
Speaker 9: you know, my you know, you know, you know, my
Speaker 9: family will be Australian blue heelers and their families, we
Speaker 9: docs AND's and Bassett hounds and all stuff. So then
Speaker 9: so then he's he's he's home. He's two kids who
Speaker 9: turns out of the same age as as Blue and
Speaker 9: Bingo were about the same age as Blue and Binger
Speaker 9: are now they've actually got an older on the show.
Speaker 9: Blue's seven and Bingo's five. They started out of six
Speaker 9: and four but but so he was able to draw
Speaker 9: on his own experiences because he's home with them, you know,
Speaker 9: he's trying to work and he's running up and down
Speaker 9: the stairs, and anybody's watched the show, that's what's going on,
Speaker 9: you know, with Bandit. The show's father and be banned It,
Speaker 9: by the way, is an archaeologist, you know, sort of
Speaker 9: a not a state home but almost a stay at
Speaker 9: home archaeologist, which is kind of interesting. But but but
Speaker 9: but in any case, he put together a pilot. The pilot,
Speaker 9: you know, you know, it had Bandit taken Bluie to
Speaker 9: the to the playground. Bandits playing you know, fruit and
Speaker 9: Ninch on his phone. He pushes Blue around the swing set,
Speaker 9: Blue goes roun the swim set, clunks him. He shows
Speaker 9: it to these guys at Ludo Studio who he does
Speaker 9: some work for, and they liked it, and it was
Speaker 9: supposed to being the fun the start. He wanted to
Speaker 9: do a show is kind of both for growing ups
Speaker 9: and for kids, so it's sort of, you know, with
Speaker 9: two levels of kind of humor. Even though but anyway,
Speaker 9: the Golubles guys liked that. They tried to shop around
Speaker 9: and people said to them Hey, is this family guy
Speaker 9: or is this Pepa pig? And they were kind of
Speaker 9: like both and and you know, and you know, people
Speaker 9: just didn't get it, except for one guy, Michael Carrington,
Speaker 9: who was head of Children's at the ABC in this
Speaker 9: case the Australian Broadcasting Corporation.
Speaker 6: But it's just.
Speaker 9: I mean, just just the genesis of the show is
Speaker 9: you know, it is so strange because because really it
Speaker 9: was just Joe Bram, you know, you know, missing being
Speaker 9: around a lot of other animators.
Speaker 3: First of all, I've always adored you and I love
Speaker 3: your reporting of respective, but to hear you talk about
Speaker 3: Luian in such detail, it's just takes it to a
Speaker 3: whole other.
Speaker 1: Level difference from talking about Diddy.
Speaker 3: Yeah, I'm like trying to think, we'll wait the last
Speaker 3: time we talked with you, which is what makes you
Speaker 3: so wonderful, Devin Leonard.
Speaker 9: But it's it's just such this material. It's just as rich.
Speaker 9: It's crazy.
Speaker 3: Well speaking of rich, right, it's made a lot of
Speaker 3: money for some people.
Speaker 9: Yeah, I mean, I mean, it's it's are you well,
Speaker 9: it's well, it turns out the A b C. Basically
Speaker 9: you might you might say that they really sort of
Speaker 9: discovered the show, and and and Michael Carrington was able
Speaker 9: to get the ABC to put some money into a pilot.
Speaker 9: They he said, he said, I would have greenlited, you know,
Speaker 9: you know, on the spot, but they didn't have no money.
Speaker 9: So but they did give uh, you know, Joe Browman,
Speaker 9: you know, Ludo's enough money to actually you know, make
Speaker 9: a five minute pilot, which BBC Studios loved. But as
Speaker 9: part of the deal, BBC Studios wound up with the
Speaker 9: international distribution and licensing rights, and you know, and and
Speaker 9: the you know, the ABC guys like, well, we don't
Speaker 9: have those kind of resources, so they might as well,
Speaker 9: they might as well, you know, you know, you know,
Speaker 9: take that. But so then they're the guys that have
Speaker 9: been making making you know, you know, all the money.
Speaker 9: I mean, you know, Ludo Studios controls it, so obviously
Speaker 9: they're making money. Joe gets, uh gets a percentage of
Speaker 9: the revenues. But but they're the people doing all the
Speaker 9: toy deals, okay and all that.
Speaker 1: Yeah, Well, what about Disney, Well we'll watch it in most.
Speaker 5: Of the world.
Speaker 3: Yeah.
Speaker 9: No, I mean I think I said before I came
Speaker 9: into this whole thing, this is a Disney show. You know,
Speaker 9: oh no, it's just to show their license. And in
Speaker 9: twenty nineteen they outbid a whole lot of other including Nickelodeon,
Speaker 9: to uh, you know, you know, for the rights rights
Speaker 9: to distribute the show, i e. You know, on their
Speaker 9: platforms on Disney Junior, Disney Channel and on Disney Plus.
Speaker 9: But what they passed up at the time they also
Speaker 9: had had had the chance to license the merchandising and
Speaker 9: the theme park rights.
Speaker 5: Which they understand.
Speaker 9: Yeah yeah, but but but but but but so that's
Speaker 9: you know, that's something they really regret now because anyway, yeah, good, okay,
Speaker 9: well get about a minute left.
Speaker 1: Season four? Is there going to be a Season four?
Speaker 3: Is asking first kids, Well.
Speaker 9: You know, there hasn't. There hasn't. It hasn't been announced,
Speaker 9: and uh, you know, season three is about the calm
Speaker 9: eight with this with a special episode. The sign is
Speaker 9: twenty eight minutes long, and you know, people are sort
Speaker 9: of saying, oh, you know, there's going to be a
Speaker 9: season four, but well I will actually nobody can say
Speaker 9: for sure, and we're trying to act as if there's
Speaker 9: going to be one. But season three with greenlit in
Speaker 9: twenty twenty, I mean, that's been running in Australia since
Speaker 9: twenty twenty months so so so basically they wrapped, you know,
Speaker 9: they wrapped season three, you know, you know in like
Speaker 9: around in twenty you know, sometime in like twenty twenty two,
Speaker 9: maybe late twenty twenty's. There's nothing else out there. And
Speaker 9: this is when when you know, the excitement about the show,
Speaker 9: it's just you know, it just keeps getting higher and higher,
Speaker 9: you know, you know, people are really excited about the sign.
Speaker 9: But then what and also what's Blue worth? You know,
Speaker 9: I didn't mention it mentioned before, but but you know
Speaker 9: Bluesman valued. You know, it's you know, said to be
Speaker 9: worth as much as two billion dollars. It could be
Speaker 9: worth it, you know, going forward, it could be worth
Speaker 9: as much as Peppa Pig was and it was sold
Speaker 9: to Hasbro. Yeah, you know, if it's for four billion dollars,
Speaker 9: but with three seasons, you know, I don't know. And
Speaker 9: it's this unclear Joe Brum, who's really a creative geetius
Speaker 9: whether or not you know, he wants to keep going.
Speaker 1: Our thanks to Devin Leonard, Bloomberg BusinessWeek Senior Global Business writer,
Speaker 1: his story once again the cover of the new issue
Speaker 1: of BusinessWeek magazine, which is available on newsstands, on the
Speaker 1: Bloomberg terminal and at Bloomberg dot com slash BusinessWeek. I
Speaker 1: took four copies of the magazine and gave it to
Speaker 1: my son's teacher and they're going to do a project
Speaker 1: with them.
Speaker 3: Oh that is so great. Oh my god. See business Week.
Speaker 3: It appeals to everybody.
Speaker 1: Yeah, pre k kids like business Week. Absolutely, I get
Speaker 1: them started. Toy.
Speaker 3: I agree, you're listening to Bloomberg business Week coming up.
Speaker 3: The right putter on the golf course and the big
Speaker 3: drama off the course have a mounting tension between the
Speaker 3: PGA Tour and live golf is leaving everyone rich but
Speaker 3: no one happy.
Speaker 1: And later on something in the golf world that's made
Speaker 1: in small matches and sells for many times what the
Speaker 1: off the rack models do circle tas.
Speaker 10: Originally these were clubs that only went out to players
Speaker 10: on the PGA Tour, players that were playing professionally, and
Speaker 10: so they really were, you know, custom clubs that are
Speaker 10: only made for the best players in the world. Now,
Speaker 10: obviously Scottie Cameron and his employees are making plutters for pros,
Speaker 10: but they have a stock that is released to the
Speaker 10: public that you know is very similar to the things
Speaker 10: the pros are kind of.
Speaker 1: It's all ahead.
Speaker 2: This is Bloomberg. You're listening to the Bloomberg Business Week podcast.
Speaker 2: Listen live each weekday. He's starting at two pm Eastern
Speaker 2: on applecar Play and ANDROYD Auto with the Bloomberg Business Ad.
Speaker 2: You can also listen live on Amazon Alexa from our
Speaker 2: flagship New York station, Just say Alexa play Bloomberg eleven thirty.
Speaker 3: All right, Tim. Last week we talked about this a lot.
Speaker 3: It was one of the most right stories on the Bloomberg.
Speaker 3: It was about billionaire in New York Mets owner Steve
Speaker 3: Cohen saying he expects that more businesses will move to
Speaker 3: a four day work week once AI artificial intelligence takes over,
Speaker 3: and that is one of the reasons he's been pouring
Speaker 3: millions into golf.
Speaker 1: Yes, I was gonna say Frisbee golf.
Speaker 3: Don't know wrong, golf real would be wrong.
Speaker 1: The international game has recently attracted a lot of headlines,
Speaker 1: with billions being spent on the sport, a battle for supremacy,
Speaker 1: with big names switching from the PGA Tour to upstart
Speaker 1: live golf, a potential link up between the two and
Speaker 1: a framework agreement that has yet to be consummated.
Speaker 3: We talk about this a lot of relationships. It's complicated,
Speaker 3: well throwing, geopolitics, courtroom battles, trash talking on Capitol Hill,
Speaker 3: and we have a combustible mix that can go sideways
Speaker 3: real quick. Mulligan anyone.
Speaker 1: And also with the Masters underway and Augusta, Georgia this
Speaker 1: week and the spotlight is back on the two major
Speaker 1: rivals turned frenemies with implications that can shake up the
Speaker 1: future of the sport. This story by Bloomberg BusinessWeek freelance
Speaker 1: writer Alan Shipknock was also at Bloomberg Big Take. He's
Speaker 1: got more on the pro golf drama where everyone is
Speaker 1: rich but no one is.
Speaker 6: There's been elements of this throughout in my reporting.
Speaker 11: I mean there's cloak and dagger stuff with sources reading
Speaker 11: me documents and letters over the phone, and everyone's been
Speaker 11: super uptight all the way through because the Department of
Speaker 11: Justice has been sniffing around. There was his and her
Speaker 11: lawsuits where the tour and live where they were suing
Speaker 11: each other, now dismissed. But it's been an incredibly messy,
Speaker 11: chaotic period for the sport. I've said this before it's
Speaker 11: a gift from the content gods. I mean, golf, as
Speaker 11: we know, is this boring, traditional boutique sport. But this
Speaker 11: battle has gone from the sports page to the business
Speaker 11: page to the front page because there's so much money
Speaker 11: at state.
Speaker 6: There's so many brand name protagonists.
Speaker 11: And whether you're talking about his excellency you see your
Speaker 11: Al Rumaine who runs the PIFF, or Donald Trump, who's
Speaker 11: become part of the story, every golfing grate of the
Speaker 11: last thirty years has been sucked into it. It's really
Speaker 11: a sprawling and riveting story to cover.
Speaker 3: Right, the PIF being, of course, the Saudi Arabian government's
Speaker 3: public Investment Fund. All right, take us back, take us
Speaker 3: back to when Live first launched and we were all like, wait,
Speaker 3: what is this about. So take us back to kind
Speaker 3: of the origins and the beginning of this very troubled
Speaker 3: relationship between the two platforms.
Speaker 11: Yeah, I mean, what it's about is money, power, greed, vengeance,
Speaker 11: you know, legacy. There's this big, huge Shakespearean themes that
Speaker 11: run through this entire story. On a macro level, I mean,
Speaker 11: it really comes down to you know, golf was one
Speaker 11: of the first sports to go to Saudi Arabia. In
Speaker 11: twenty nineteen, the European Tour played an event there and
Speaker 11: it was conducted just a few months after Jamal Kashogi
Speaker 11: had been murdered, and of course, the Crown Prince of
Speaker 11: Saudi Arabia has always been implicated in his death, and
Speaker 11: so the fact that the European Tour stuck by their
Speaker 11: host didn't cancel this tournament, even when Western businesses and
Speaker 11: thought leaders and financial leaders were abandoning the Kingdom of
Speaker 11: Saudi Arabia. That meant a heck of a lot to
Speaker 11: those in power there. And golf's a global game, it
Speaker 11: obviously caters to the financial elite. We all know a
Speaker 11: lot of deals get done on a golf course, and
Speaker 11: so it served veryous strategic goals for Saudi Arabia. And
Speaker 11: Al Rumayan, who runs a public vestment fund, is a
Speaker 11: golf tragic. He loves the game as much as anybody,
Speaker 11: and so the Saudis went all in on golf as
Speaker 11: a way to sports watch the reputation, as a way
Speaker 11: to expand their influence, to get into the halls of power,
Speaker 11: to get a seat at the proverbial table. There was
Speaker 11: a lot going on here and they tried to partner
Speaker 11: with the European Tour.
Speaker 6: That didn't work out.
Speaker 11: They at one point they were aligned with the Premier
Speaker 11: Golf League, which was this would be competitor upstart league
Speaker 11: that never quite launched, but helped germinate the idea and
Speaker 11: ultimately the powers that be Saddi Raby decided to go
Speaker 11: on and do it on their own. They had the money,
Speaker 11: they recruited the intellectual capital, a lot of it from
Speaker 11: the Premier Golf League, and they launched Live Golf as
Speaker 11: this incredibly disruptive force, not only in the golf world
Speaker 11: but really the entire sports world. And so what and
Speaker 11: that's that's that was two years ago, and the verberations
Speaker 11: are still being felt.
Speaker 3: Well, Alan and I feel like I'm a daughter or
Speaker 3: a daughter of someone who was My dad was an
Speaker 3: avid golfer, my four brothers. It was a passage, uh
Speaker 3: you know, right of passage if you will, in terms
Speaker 3: of learning golf growing up, and you know, I grew
Speaker 3: up kind of watching it. There's a gentility around the sport,
Speaker 3: to be quite fair, I think, and I think.
Speaker 1: That's why they won't let me play.
Speaker 12: Yeah, you're not supposed to throw your clubs I'm just
Speaker 12: going to say, but but it's interesting then to see
Speaker 12: that the animosity between players, well well known players in
Speaker 12: the sport, certainly American players, that started to arise of
Speaker 12: people who you thought were kind of friendly, you know,
Speaker 12: rivals if you will, but they really kind of were
Speaker 12: fighting each other. And there was a lot of money
Speaker 12: at stake because some players, all of a sudden, some
Speaker 12: well known American players, some well known global players, were
Speaker 12: all of a sudden getting being paid in lord away
Speaker 12: by Live Golf.
Speaker 11: Yeah, the animosity has been delicious, and you know, it
Speaker 11: exists in other sports, right like if you follow NBA
Speaker 11: Twitter or you know, players are always talking trash and
Speaker 11: there's always beef and it's part of the narrative of
Speaker 11: the sport. It's kind of a new arrival for golf,
Speaker 11: but it's been It's made it more lively, for sure.
Speaker 11: But the PGA Tour enjoyed a monopoly on big time
Speaker 11: professional golf this whole century and even going a little
Speaker 11: further back than that, and like any business with no competition,
Speaker 11: it had gotten stale, It had gotten a little bloated.
Speaker 11: The product was unimaginative, and it was ripe for disruption
Speaker 11: and we know this in any industry, when you have
Speaker 11: a competitor come in, especially one that's very, very, very
Speaker 11: well capitalized, it's going to get messy. And the PGA
Speaker 11: Tour players, it wasn't an existential threat, like their livelihood
Speaker 11: was being threatened, because top players immediately defected for live.
Speaker 6: And that week in the PGA Tour.
Speaker 11: And if you have a bad product, you're not going
Speaker 11: to attract a TV audience, you're not going to attract sponsors,
Speaker 11: and your sport is going to wither. So the tour players,
Speaker 11: the PGA Tour players rightfully took it very personally that
Speaker 11: they were being abandoned and betrayed by their colleagues. Now,
Speaker 11: basically it was just free agency came to golf, which
Speaker 11: exists in every other sport and a guy goes from
Speaker 11: the Red Sox to the Yankees, and there's some hard feelings,
Speaker 11: but people understand that it's part of the game. But
Speaker 11: this was a new invention in professional golf, and so yeah,
Speaker 11: it became very personal. Then you layer on top top
Speaker 11: of that the fact that this is all being underwritten
Speaker 11: by the Kingdom of Saudi Arabia, and you know, if
Speaker 11: the money had come from Europe or had come from
Speaker 11: American investors, it would have the debate would have had
Speaker 11: a different tenor. But clearly, in the wake of the
Speaker 11: killing of Jamalka Shogi, who was a US resident and
Speaker 11: who was a columnist for the Washington Post, undeniably the
Speaker 11: fact that fifteen to the nineteen hijackers of nine to
Speaker 11: eleven were Saudi nationals, it's an emotional issue for a
Speaker 11: lot of American sports fans and a lot of American citizens,
Speaker 11: and so to feel like there was this force from
Speaker 11: the other side of the world that with this shadowy
Speaker 11: leader in MBS and you know, not un fully understanding
Speaker 11: the intentions behind it. There's just been a level of
Speaker 11: discomfort that it's not just that the whole sport has
Speaker 11: been shaken up, but by who's underwriting it. And that's
Speaker 11: why you've seen congressional hearings, that's why you've seen a
Speaker 11: lot of blowbocks.
Speaker 1: Yeah, So, Alan, how do we get to the point
Speaker 1: where live in the PGI are at loggerheads and they're
Speaker 1: fighting for talent, lots of money, hundreds of millions of dollars,
Speaker 1: billions of dollars is flying. How do you get to
Speaker 1: that point where suddenly they reached this framework, this agreement.
Speaker 6: Because they had put them.
Speaker 11: Both tours were kind of on this path to mutually
Speaker 11: assured destruction. You know, the PGA tour product was badly devalued.
Speaker 11: They lost a bunch of their stars and Hall of
Speaker 11: famers and biggest personalities, and yet to fight live. The
Speaker 11: tour leadership was going to all their corporate sponsors saying,
Speaker 11: we need a lot more money. We got to pay
Speaker 11: the players more, and the sponsors were rebelling and saying,
Speaker 11: you're asking for more money for a diminished product, Like
Speaker 11: that's a tough sell. Simultaneously, these lawsuits were the legal
Speaker 11: fees are running in the tens of millions of dollars,
Speaker 11: and so for the tour, they were running out of
Speaker 11: money for live golf. They'd made all this noise and
Speaker 11: they'd burst onto the scene, but they had antagonized huge
Speaker 11: swaths of the golf golfing fans and the golfing public,
Speaker 11: and they were struggling to attract an audience, and so
Speaker 11: both I think there was this moment of inflection, like
Speaker 11: both organizations had to change course. And so the framework agreement,
Speaker 11: you know, it was oversold. People called it a merger.
Speaker 11: It was never that. It was basically an agreement to
Speaker 11: drop the lawsuits, which obviously helped both sides financially, and
Speaker 11: then they were going to figure out everything else later.
Speaker 11: But because it was such a stunner, I mean, this
Speaker 11: was an all time thunderbolt in the history of sports
Speaker 11: business when these two warring factions came together with no warning,
Speaker 11: all of it done in secret. The impact was so
Speaker 11: great that by that announcement people expected things to change rapidly.
Speaker 11: But really both sides there was a tremendous amount of
Speaker 11: distance in their vision of.
Speaker 6: What was going to happen.
Speaker 11: And so they'd been at this stalemate for nine months
Speaker 11: trying to negotiate this. As it became clear the framework
Speaker 11: agreement had no teeth, there was no penalty with either
Speaker 11: side walked away, you know, the sharks began to circle
Speaker 11: from Wall Street, from Silicon Valley, and from Hollywood, and
Speaker 11: the PGA tour began getting other offers, you know, whether
Speaker 11: it's private equity money or other origins. People said, hey, listen,
Speaker 11: you want money, We have money too. You don't have
Speaker 11: to take the Saudi money. And so the pieces began
Speaker 11: to move on the chess board. The tour announced in January,
Speaker 11: had taken one point five billion dollars and they have
Speaker 11: access to another one point five billion from this Strategic
Speaker 11: Sports Group, which is a consortium of American sports team
Speaker 11: owners and private equity guys and gals, and then Live
Speaker 11: you know, as a preampter strike, they signed John Rahm,
Speaker 11: the reigning Masters Champion, as kind of a warning shot like, Okay,
Speaker 11: if you're not going to negotiate with us, if you
Speaker 11: can take.
Speaker 6: Some other money, we're going to keep stealing your players.
Speaker 11: So it went, this cold war is heated up, and
Speaker 11: now it's increased the pressure on both sides around this negotiation,
Speaker 11: and there's a lot at stake, money, ego and legacy.
Speaker 6: And no one knows where it's going to go.
Speaker 11: They're still at loggerheads, and there's a lot of momentum
Speaker 11: to get it done, and there's a lot of reasons
Speaker 11: why it could fall apart, and so it remains a cliffhanger.
Speaker 1: That was Bloomberg BusinessWeek freelance writer Alan Schipknock. If his
Speaker 1: name sounds familiar, it's because he's written a lot of
Speaker 1: books about the sport of golf. Check out some of those.
Speaker 1: In addition to this great story. You can catch that
Speaker 1: story in the forthcoming issue of Bloomberg BusinessWeek magazine. It's
Speaker 1: out next week. It's already online though, and of course
Speaker 1: on the Bloomberg terminal.
Speaker 3: And staying with golf for a moment, Tiger Woods heard
Speaker 3: of him, Yeah is and other golf grades, Putter choice,
Speaker 3: who knew how that turned a brand into a lofty
Speaker 3: asset class?
Speaker 1: Plus the French hotels getting the big time. Michelin, Nod
Speaker 1: and Deecaff long been the subject of derision and jokes
Speaker 1: within the coffee industry.
Speaker 3: A last number of.
Speaker 13: These new innovations and their methods. For a long time
Speaker 13: it was using Benzene Swiss in their facilities in British Columbia.
Speaker 13: They use water. They actually use like a green coffee extract,
Speaker 13: soak the beans and then the caffeine molecules bind to
Speaker 13: the extract and then it's flush.
Speaker 1: So it's safe to drink.
Speaker 3: Tech Now it's all head in pursuits. This is Bloomberg.
Speaker 2: You're listening to the Bloomberg Business Week podcast. Listen live
Speaker 2: each weekday starting at two pm Eastern on applecar Play
Speaker 2: and Android Auto with the Bloomberg Business ad. You can
Speaker 2: also listen live on Amazon Alexa from our flagship New
Speaker 2: York station, Just say Alexa play Bloomberg eleven thirty.
Speaker 1: Well, Carol. The new issue of BusinessWeek is out and
Speaker 1: in it a story about Scottie Cameron's custom golf clubs
Speaker 1: that are solid investments objects dart. You might even say
Speaker 1: that attract a whole other level of devote.
Speaker 3: Just ask Tiger Woods, Brooks, Koepka, others. Are they worth
Speaker 3: the love? Writing about it is freelance contributor Chris Almeida
Speaker 3: who joins us now about the putter choice that's turned
Speaker 3: around into an asset class. Chris, who is and what
Speaker 3: is Scottie Cameron?
Speaker 7: So?
Speaker 10: Scotti Cameron is a putter maker based in southern California
Speaker 10: who has been making putters since he was a kid.
Speaker 10: You know, he started tooling around in his garage with
Speaker 10: his dad before he was a pre teen, and he
Speaker 10: was a competitive golfer as a junior, but you know,
Speaker 10: pretty quickly realized that he wasn't going to make it
Speaker 10: as a pro, and so he decided to go all
Speaker 10: in on making putters. And when he was in his twenties,
Speaker 10: an old instructor of his brought in a twelve year
Speaker 10: old Tiger Woods to see the clubs that he'd made,
Speaker 10: and Tiger, as a little kid, loved them and has
Speaker 10: more or less played them ever since, which has been
Speaker 10: part of what has made Scottie Cameron's business so successful.
Speaker 10: In the mid nine he signed a contract to be
Speaker 10: exclusive with Titleist, and then in ninety seven Tiger Woods
Speaker 10: obviously won the Masters with this very distinctive Scottie Cameron putter.
Speaker 10: It was a black putter with a bunch of white
Speaker 10: dots in the back and a copper insert in the front,
Speaker 10: and ever since then the brand has exploded, and now
Speaker 10: his custom putters, which are differentiated from the ones the
Speaker 10: Titleist sells, you know, that are mass manufactured, are extremely
Speaker 10: expensive and very hard to get, and everyone, every golfer
Speaker 10: wants one, but even if you can afford it, you
Speaker 10: can't often get your hands.
Speaker 1: Almost okay, So talk about the supply and demand part
Speaker 1: of this here, because this is a company that does
Speaker 1: essentially drops a limited edition, limited supply of these putters
Speaker 1: in time increments and people line up for him, and
Speaker 1: very few people actually get them.
Speaker 10: They've definitely embraced some of the drop culture that has
Speaker 10: been made very popular by brands like Supreme. They release
Speaker 10: these four or five custom putters to the public every
Speaker 10: week via email newsletter, and these will vary in design
Speaker 10: until Wednesday, when this email goes out. You don't know
Speaker 10: what any of these are going to look like. They
Speaker 10: could be different colors, have different weird stampings on them.
Speaker 10: They could have, you know, a different kind of neck
Speaker 10: or a different kind of putter blade or whatever, and
Speaker 10: they'll be priced accordingly. And I think around four years ago,
Speaker 10: demand for these roads so high that they would sell
Speaker 10: out basically within seconds of the email going out, and
Speaker 10: so they had to institute a lottery system where now
Speaker 10: when the email goes out, you have to say I'm
Speaker 10: interested in buying this putter and click a button and
Speaker 10: enter to buy it. And if you get an email
Speaker 10: back saying you've been chosen to buy it, you get
Speaker 10: the privilege of spending four thousand dollars on one of
Speaker 10: these clubs.
Speaker 14: These are the circle T's right Yes, which is it's
Speaker 14: a logo kind of inspired by a branding iron that
Speaker 14: is meant to denote, you know, somewhat misleadingly that these
Speaker 14: clubs are for tour use only.
Speaker 10: So originally these were clubs that only went out to
Speaker 10: players on the PGA Tour, players that were playing professionally,
Speaker 10: and so they really were you know, custom clubs that
Speaker 10: are only made for the best players in the world. Now,
Speaker 10: obviously Scottie Cameron and his employees are making putters for pros,
Speaker 10: but they have a stock that is released to the
Speaker 10: public that you know, is very similar to the things
Speaker 10: the pros are.
Speaker 3: Kind of speaking of stock or stocks, you get into
Speaker 3: in the story, you know, goods and items that sell
Speaker 3: on the secondary market. So the story gets into how
Speaker 3: this has become an asset class. Talk a little bit
Speaker 3: more about that.
Speaker 10: Yeah, so I said how much they cost when you
Speaker 10: buy them directly from the company. When you buy them
Speaker 10: not directly from the company, they are going to be
Speaker 10: at least twice as expensive. So you'll see these, you know,
Speaker 10: particular putters, depending on what they are, can go for
Speaker 10: tens of thousands of dollars and then often basically the
Speaker 10: putters that look just like Tiger Woods's putter can sell
Speaker 10: for hundreds of thousands of dollars. So there, I talked
Speaker 10: to Ryan Carey who runs Golden Age Auctions, which is
Speaker 10: an auction house that basically sells golf collectibles, and he
Speaker 10: managed to get his hands on a Tiger Woods backup putter,
Speaker 10: which is something that Scotti made for Tiger just in
Speaker 10: case something happened to Tiger's main putter, and this eventually
Speaker 10: got sold, and then when it was auctioned by Golden
Speaker 10: Age Auctions, it sold for four hundred thousand dollars. So
Speaker 10: that is, you know, that's kind of the top end.
Speaker 10: I'm not going to pretend like that's regular, but even
Speaker 10: the ones that are released every week, if something goes
Speaker 10: for four thousand, you can instantly flip it for eight
Speaker 10: thousand and the demand will be there, no question.
Speaker 1: So I guess the big question that I have is
Speaker 1: does the putter really change your game?
Speaker 5: Probably not that much.
Speaker 6: It's hard to say.
Speaker 10: And this is I think part of the mystique or
Speaker 10: the you know, romanticism of putters in general, is that,
Speaker 10: you know, putting is a hard part of the game
Speaker 10: to measure. Golf clubs in almost every other part of
Speaker 10: the game, drivers, irons, wedges, you know, the things that
Speaker 10: those clubs are doing can be measured, The spin rates
Speaker 10: can be measured, the club path that you know, particular
Speaker 10: golfer has can be measured and then you can design
Speaker 10: a club to really fit that well. Hutting is the
Speaker 10: least scientific part of the game, and so a lot
Speaker 10: of what has to do with being a good putter
Speaker 10: is confidence and repeatability, and so people get a little
Speaker 10: religious about their putters. But there's just enough of a
Speaker 10: question for people to maybe believe.
Speaker 1: That's freelance contributor Chris Almeida.
Speaker 3: All right, everybody, it's time for Bloomberg Pursuits. Everything from
Speaker 3: top top top hotels in France to the coffee that
Speaker 3: gets no love until now. And speaking of not getting
Speaker 3: love until now, go figure Tim. New York City airports.
Speaker 1: Yeah, they were the butt of jokes, but now they're
Speaker 1: actually looking pretty good. This is all from our Pursuits team.
Speaker 1: Joining us as the deputy editor of Bloomberg Pursuits, James Gaddie. James,
Speaker 1: I was telling Carol one of my favorite things you
Speaker 1: know that pastimes, I guess is when people come to
Speaker 1: visit in New York, they say Lagardia is really nice. Now,
Speaker 1: so true, people sweet about it all the time. It's
Speaker 1: because it's like such a different I was in LaGuardia
Speaker 1: once and there were buckets all over collecting rainwater.
Speaker 3: It what's terrible.
Speaker 5: You know.
Speaker 13: We have a quote from Rick Cotton, the executive director
Speaker 13: for the Port Authority, who is like, people are telling
Speaker 13: me they are actually going to LaGuardia early just so
Speaker 13: they can hang out. That's me, Like, JFK is so
Speaker 13: much closer to me. I'm actually buying tickets to fly out.
Speaker 3: Of Lagordia because you want to bring right, it's so
Speaker 3: nice water features.
Speaker 6: Yeah, it's always crowded. I can't get a seat next
Speaker 6: to it.
Speaker 1: It's love it. You walk past the life sized Lego
Speaker 1: person to get to it.
Speaker 3: You're posting pictures on Instagram.
Speaker 1: Okay, okay, So how do we get here though? How
Speaker 1: do we get here?
Speaker 13: A lot of billions of dollars public private partnerships. Yeah,
Speaker 13: Lagordia got eight billion, to be exact. Honestly, if you
Speaker 13: want to go back a little bit, it starts with
Speaker 13: our president Joe Biden. I remember this, who in twenty
Speaker 13: sixteen when he was vice president, landed in LaGuardia and
Speaker 13: said it reminded him of a third world country. And
Speaker 13: you know it was sort of like I mean, it
Speaker 13: was a little tackless, of course, but you know, I
Speaker 13: don't know how much that sort of like kickstarted everything,
Speaker 13: but yes, nine billion dollars later. Last month, it was
Speaker 13: named best airport in the United States. Five years ago
Speaker 13: it was the literally the last one on the list,
Speaker 13: the worst.
Speaker 3: As a New Jersey person when bred proud of it
Speaker 3: Jersey Girl Newark. The first time I came off terminal
Speaker 3: A after its renovation, I was like, where am I when?
Speaker 3: And when did this happen?
Speaker 13: If that one took a little bit longer it was
Speaker 13: five years in the making, two point seven billion dollars
Speaker 13: goes a little bit further in New Jersey.
Speaker 3: I guess you might expense it's amazing when you cross
Speaker 3: the river.
Speaker 13: But I have to say I'm really excited about JFK.
Speaker 13: It's nineteen billion.
Speaker 1: Yeah, why are you so excited about JFK.
Speaker 13: It's huge, It's terrible, and you know it's just they're
Speaker 13: just old. They've been kind of taking their their hits
Speaker 13: and you know, one of the interesting things that we
Speaker 13: talked to the design firm Gensler, who is doing JFK,
Speaker 13: they said, everything we made, every decision we're making is
Speaker 13: for the customer in mind, and that extends to accessibility.
Speaker 13: First airport, he said, he's ever worked on, where accessibility
Speaker 13: has been first and foremost in their mind.
Speaker 1: I asked, Carol, can they do the subways next?
Speaker 13: Yes, I just got off the subway and I was
Speaker 13: thinking that exactly.
Speaker 3: Please help speaking my language. But I like the way
Speaker 3: they're rethinking this space. I have to say. I'm one
Speaker 3: of those people who really likes a good airport. I
Speaker 3: just do I wander. I like it's like shopping. It's
Speaker 3: like just it's an experiences, right, And that's how they're
Speaker 3: thinking about it.
Speaker 13: Not speaking my language.
Speaker 1: Okay, I know what does speak your language, Carol.
Speaker 3: Well, we're going to coffee. We're going from something that
Speaker 3: wasn't loved the New York City airports too. Also something
Speaker 3: that wasn't loved decaf coffee, because I'm a big dcaff
Speaker 3: coffee drinker. And well, I know, please don't judge Baber.
Speaker 1: Well she's part of the that's exactly what's happening with
Speaker 1: why more people are drinking decaf now.
Speaker 13: Yeah, so tell me what's going on artisanal coffee. I mean,
Speaker 13: you know, you think of like the blue bottle coffees
Speaker 13: of the world, and they take their coffee seriously. And
Speaker 13: you could argue if they take the caffeine version of
Speaker 13: their coffee seriously, they're going to take the decaff version seriously.
Speaker 13: So that's one of it. On one part of it.
Speaker 13: The other part is, you know these new innovations and
Speaker 13: their methods. For a long time it was using benzene.
Speaker 3: Yeah, what's up with that?
Speaker 1: Tim and I are book like, I read no idea.
Speaker 3: We like read the story. We're like benzene.
Speaker 1: Your synogens were used for years to remove the caffeine
Speaker 1: from coffee beans.
Speaker 13: Yeah, so I think that might have been part of
Speaker 13: the problem with the tastes.
Speaker 1: Can we confirm that these methods are no longer used?
Speaker 1: Just using water?
Speaker 13: Now Swiss water in their facilities in British Columbia they
Speaker 13: use water. They actually use like a green coffee extract,
Speaker 13: soak the beans and then the caffeine molecules bind to
Speaker 13: the extract and then it's flushed.
Speaker 1: So it's safe to drink.
Speaker 7: Now.
Speaker 1: Yes, I think what was such a big deal about
Speaker 1: this story is that from a taste perspective, there was
Speaker 1: a recent competition and for the first time in years,
Speaker 1: first time ever, a decaf coffee won the taste test.
Speaker 13: Yeah, the Brewer's Cup. Last month's a big deal. Yeah,
Speaker 13: you know that that being in particular uses a little
Speaker 13: bit of a different method than what Swiss water uses.
Speaker 13: They use ethyl acetate. I don't want to get too
Speaker 13: far in the weeds, but you basically for molasses and
Speaker 13: you convert it into all this other stuff. Then they
Speaker 13: re like kind of like blend it with the muselage
Speaker 13: or the pulp, which gives it actually more flavor back
Speaker 13: into the being.
Speaker 3: No Benzen though, No Benzi. All right, we run out
Speaker 3: of time, but there's a great thing. We highly recommend
Speaker 3: everybody go online or check out the magazine because Michelin
Speaker 3: now right doing its first ever ranking of top hotels
Speaker 3: and they start with Powis.
Speaker 13: Yeah, you know, three star Michelin restaurant. Now you've got
Speaker 13: three key Michelin hotels. They started in Paris. There's one
Speaker 13: hundred and eighty nine of them. The whole list is
Speaker 13: on our website.
Speaker 3: This is why we love you, guys, all the things
Speaker 3: to do. Thank you for bringing back.
Speaker 1: Decap and a big thank you to Deputy editor of
Speaker 1: Bloomberg Pursuits James Gaddy.
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