WEBVTT - Winning the Information War 0:00:01.800 --> 0:00:04.440 This is Bloomberg Business Week. I'm Carole Masser and I'm 0:00:04.440 --> 0:00:07.280 Bloomberg Quick Takes Tim Stanibek. We're here every day bringing 0:00:07.280 --> 0:00:09.799 you the latest news from the world of business and finance, 0:00:09.840 --> 0:00:13.600 plus technology, politics, economics, all harnessing the power of Business 0:00:13.640 --> 0:00:17.119 Week reporters and editors, not to mention our journalists and 0:00:17.120 --> 0:00:20.000 analyst in more than one twenty countries. You can download 0:00:20.000 --> 0:00:23.200 Bloomberg Business Week on iTunes, SoundCloud, or Bloomberg dot Com. 0:00:23.400 --> 0:00:25.120 You can also listen to our radio show at two 0:00:25.160 --> 0:00:27.840 pm Eastern Time on Bloomberg Radio or watch us on 0:00:27.880 --> 0:00:31.240 YouTube search Bloomberg Global News. I want to get to 0:00:31.240 --> 0:00:35.720 our next guest. He's written about um, the US reaction 0:00:36.000 --> 0:00:38.560 and watching what's going on in Russia and Ukraine. Specifically, 0:00:38.560 --> 0:00:41.000 he's written about why the US cannot allow Russia to 0:00:41.000 --> 0:00:44.960 create a sphere of influence. He's also talking about really basically, 0:00:45.520 --> 0:00:48.920 you know, managing to some extent the information that's going 0:00:48.920 --> 0:00:50.640 out there, and how the US is learning to win 0:00:50.720 --> 0:00:54.400 the information war. How brands is Bloomberg opinion columnist Henry 0:00:54.400 --> 0:00:58.000 As entered Distinguished Professor at Johns Hopkins University School of 0:00:58.040 --> 0:01:01.000 Advanced International Studies. He's a sky all or two at 0:01:01.040 --> 0:01:04.560 the American Enterprise Institute, author of The Twilight Struggle What 0:01:04.600 --> 0:01:07.440 the Cold War teaches us about great power rivalry? Today 0:01:07.440 --> 0:01:10.160 he is on the phone in Baltimore, Maryland. How it 0:01:10.280 --> 0:01:13.640 is great to have you here with Katie and myself, 0:01:13.800 --> 0:01:18.080 So initially as you continue to see this situation in 0:01:18.200 --> 0:01:23.280 full present buying just making some comments about um, some sanctions, Um, 0:01:23.319 --> 0:01:27.160 what's your initial thoughts here? So? I think that the 0:01:27.200 --> 0:01:30.839 Biden administration has tried to strike a balance between being 0:01:30.880 --> 0:01:33.320 strong and its response to what we've seen from Russia 0:01:33.480 --> 0:01:37.240 so far, while also holding and reserve more severe sanctions 0:01:37.240 --> 0:01:39.520 that might be put in place if there's further Russian 0:01:39.520 --> 0:01:42.680 aggression in Ukraine. And so the first tranch has been 0:01:42.680 --> 0:01:46.200 fairly impressive. I think the central measure is basically putting 0:01:46.200 --> 0:01:48.040 the nord Stream two on hold, and we'll see what 0:01:48.120 --> 0:01:51.320 happens if putin goes further. And how I want to 0:01:51.320 --> 0:01:54.040 wrap this into this column that you had out on Friday, 0:01:54.080 --> 0:01:57.800 that the US can't let Russia get a sphere of influence. 0:01:57.840 --> 0:02:00.640 I mean, just listening to President Biden speak, some of 0:02:00.640 --> 0:02:03.160 the headlines coming out saying that you know, Biden still 0:02:03.280 --> 0:02:06.640 believes Russia's poised to go much further, that this is 0:02:06.680 --> 0:02:09.720 the beginning of a Russia invasion. I mean, if you could, 0:02:09.760 --> 0:02:12.080 you know, look inside the President's mind right now, would 0:02:12.080 --> 0:02:14.880 you say that this is the fear, that that's what 0:02:14.960 --> 0:02:18.560 Russia wants to create a sphere of influence. I think 0:02:18.600 --> 0:02:22.240 that's certainly what the Biden administration fears, in part because 0:02:22.240 --> 0:02:25.200 Putin has mobilized a force that is far bigger than 0:02:25.240 --> 0:02:29.000 he need simply send some so called peacekeepers into the 0:02:29.040 --> 0:02:32.960 done boss. If you'll take Putin's rhetoric seriously, He's talked 0:02:33.000 --> 0:02:37.360 about rebuilding the influence of the Soviet Union used to have. 0:02:37.480 --> 0:02:39.600 He's called the collapse of the Soviet Union the great 0:02:39.600 --> 0:02:42.880 geopolitical tragedy of the twentieth century. And so I think 0:02:42.880 --> 0:02:45.679 at this point it's only prudent to expect that his 0:02:45.760 --> 0:02:48.800 objectives are not limited to Eastern Ukraine. Isn't it kind 0:02:48.800 --> 0:02:50.720 of ironic? Though? The U s is okay about it 0:02:50.840 --> 0:02:54.079 being involved in spheres of influence and being the great influencer, 0:02:54.160 --> 0:02:59.120 and yet it's very uncomfortable with others. There is a 0:02:59.120 --> 0:03:01.280 certain irony to the out of of course, there's critics 0:03:01.360 --> 0:03:04.160 might call it hypocrisy. But of course the big difference 0:03:04.280 --> 0:03:07.680 is that most countries want to be part of America's 0:03:07.720 --> 0:03:11.360 sphere of influence with the dynamic that's obviously absent from 0:03:11.360 --> 0:03:14.560 the Russian case. And so there are a very few 0:03:14.560 --> 0:03:18.800 countries that are trying to leave America's system of alliances today. 0:03:18.880 --> 0:03:20.560 There are many many more that would prefer to be 0:03:20.639 --> 0:03:22.919 part of that system. It's the opposite when you look 0:03:22.960 --> 0:03:27.200 at the countries around Russia's periphery. So just to follow then, 0:03:27.360 --> 0:03:31.280 So what's really at stake here? And if Russia is 0:03:31.320 --> 0:03:34.240 allowed to have too much of its way and sway, 0:03:34.280 --> 0:03:37.400 if you will, in the region, what are the implications 0:03:37.400 --> 0:03:41.680 the longer term implications, Well, there would be a sustained 0:03:41.760 --> 0:03:46.960 crisis of security along NATO's eastern frontier as Russia gather 0:03:47.120 --> 0:03:51.600 strength and postures its forces more menacingly in Ukraine and Belarus, 0:03:51.600 --> 0:03:54.160 in addition to on its own territory. And I think 0:03:54.160 --> 0:03:56.839 one of the concerns and American policymakers have always had 0:03:57.040 --> 0:04:00.920 is that when aggressive authoritarian regimes are able to carve 0:04:00.920 --> 0:04:03.240 out a fear of influence, they don't necessarily stop there. 0:04:03.280 --> 0:04:06.480 They might simply use it as a platform to push further. 0:04:06.560 --> 0:04:07.840 And so I think the fear in the in the 0:04:07.920 --> 0:04:10.800 United States and in many European capitals would be that 0:04:10.840 --> 0:04:13.640 Putin would use a strengthened position in Eastern Europe to 0:04:13.680 --> 0:04:17.320 apply greater pressure to the Baltic States or Poland, for instance. 0:04:18.000 --> 0:04:19.880 And how I want to turn to another piece you 0:04:19.920 --> 0:04:22.680 had out for Bloomberg opinion that the US is learning 0:04:22.720 --> 0:04:25.840 to win the information more and you highlight that the 0:04:25.839 --> 0:04:30.880 Biden administration they've been willing to publicly release sensitive intelligence 0:04:30.960 --> 0:04:32.960 on Russia. I was telling Carroll earlier that I was 0:04:33.000 --> 0:04:35.560 listening to Biden speak on Friday, and I was kind 0:04:35.560 --> 0:04:38.159 of shocked to hear him say that he expects invasion 0:04:38.200 --> 0:04:41.080 within the next few days, within the next week, you know, 0:04:41.160 --> 0:04:44.559 to hear that from the President, it's not not something 0:04:44.600 --> 0:04:47.159 we've gotten used to. And I'm curious what you think 0:04:47.240 --> 0:04:51.760 is behind that strategy shift. Well, part of it is 0:04:51.800 --> 0:04:54.799 about forcing Putin to pay as higher price as possible 0:04:54.880 --> 0:04:58.360 for what he's doing in Ukraine, and part by depriving 0:04:58.440 --> 0:05:00.839 him of the ambiguity and s rise in which he 0:05:00.880 --> 0:05:03.760 likes to cloak his actions. And so the United States 0:05:03.760 --> 0:05:05.840 is trying to get out ahead of Russian moves is 0:05:05.880 --> 0:05:09.680 a way of rallying the broadest possible coalition to to 0:05:09.760 --> 0:05:12.480 punish those moves when they occur. I think the other 0:05:12.520 --> 0:05:14.560 thing that's happening those United States has learned that it 0:05:14.600 --> 0:05:17.160 simply has to be faster when it comes to responding 0:05:17.200 --> 0:05:21.000 to disinformation, whether in this or other context. That we've 0:05:21.000 --> 0:05:23.839 seen that the Russians are certainly going to try to 0:05:23.880 --> 0:05:26.480 create a variety of of lies and this truth around 0:05:26.839 --> 0:05:30.240 their role in Ukraine, perhaps inventing Ukrainian provocations. And the 0:05:30.240 --> 0:05:32.159 only way the United States is going to be able 0:05:32.200 --> 0:05:35.240 to push back against that disinformation is by getting its 0:05:35.240 --> 0:05:38.560 own story out more quickly, right. And it also is 0:05:38.640 --> 0:05:41.600 kind of uh, I guess how you could say is hey, guys, 0:05:41.839 --> 0:05:45.040 we know what you're doing even before it is publicly known, 0:05:45.120 --> 0:05:49.080 like we're on it. That's right. I mean, there's certainly 0:05:49.120 --> 0:05:51.839 some messaging going on here that the U. S Intelligence 0:05:51.880 --> 0:05:55.520 has very good information not simply on Russian troop movements 0:05:55.520 --> 0:05:59.280 and military preparations, but on the innermost decision making of 0:05:59.320 --> 0:06:01.120 the regime. And I would imagine that some of these 0:06:01.120 --> 0:06:04.559 releases are meant to create a certain sense of doubt 0:06:04.640 --> 0:06:07.839 or even dissension within the regime by advertising the fact 0:06:07.880 --> 0:06:11.960 that it's intermost communications are presumably compromised. What's the risk 0:06:12.000 --> 0:06:14.200 of doing this though on the part of present vine, 0:06:14.279 --> 0:06:17.800 especially if you get something wrong, well, you you could 0:06:17.839 --> 0:06:20.560 look foolish. If you get something wrong, you could promote 0:06:20.720 --> 0:06:24.200 crisis fatigue. If you're constantly warning about an imminent invasion, 0:06:24.320 --> 0:06:26.920 you can also blow sources and methods, and so of 0:06:26.960 --> 0:06:31.000 the United States too aggressively publicized information that it has 0:06:31.000 --> 0:06:33.640 obtained through sensitive sources, it could make it easier for 0:06:33.680 --> 0:06:36.640 the Kremlin to figure out what the conduit for that 0:06:36.720 --> 0:06:39.400 information is in the first place. And so there's certainly 0:06:39.400 --> 0:06:41.320 a balancing of risks that that that has to be 0:06:41.320 --> 0:06:44.159 involved here. All right, we're gonna leave it on that note. Listen, 0:06:44.200 --> 0:06:47.640 we really appreciate your insight, uh and taking some time 0:06:47.960 --> 0:06:50.360 to chat with us. How brands Henry A. Kiss Into 0:06:50.360 --> 0:06:53.200 a distinguished professor at Johns Hopkins University School of Advanced 0:06:53.200 --> 0:06:56.680 International Studies. He is a Bloomberg opinion columnist, and as 0:06:56.680 --> 0:06:59.039 we mentioned, he's got a book that's very timely right now. 0:06:59.160 --> 0:07:02.120 It is entitled The Twilight Struggle. What the Cold War 0:07:02.200 --> 0:07:04.960 teaches us about great power rivalry today? Joining us on 0:07:05.000 --> 0:07:07.960 the phone from Baltimore. The pandemic really taught us big 0:07:08.000 --> 0:07:10.480 time the importance of connectivity, and for many of us, 0:07:10.920 --> 0:07:12.440 I think Katie, it's saved to say, were kind of 0:07:12.480 --> 0:07:15.480 shocked at how well it worked thanks to advancements and technology, Like, 0:07:15.520 --> 0:07:18.640 it's amazing what everybody was able to get done. Yeah. Absolutely, 0:07:18.680 --> 0:07:21.800 I mean it felt like life as we know. It 0:07:21.920 --> 0:07:26.120 moved online for everyone, for workers, for students, for everyone. 0:07:26.200 --> 0:07:29.960 We did okay, we did okay, We're doing okay, not perfect, 0:07:30.040 --> 0:07:32.880 not equal, but still impressive. Back with us and working 0:07:32.880 --> 0:07:36.640 on creating the connected campus is Transact Campus ces Nancy Linger. 0:07:36.920 --> 0:07:39.680 She joins us once again on the phone in Phoenix, Arizona. Nancy, 0:07:39.920 --> 0:07:41.440 nice to have you here with Katie and myself. How 0:07:41.480 --> 0:07:45.360 are you. I'm good, How are you kill doing okay? 0:07:45.400 --> 0:07:48.520 Doing okay? Managing through and just trying to, you know, 0:07:48.840 --> 0:07:52.640 take take in everything that keeps continually being continuously being 0:07:52.640 --> 0:07:55.920 thrown at us. So remind our audience about what you 0:07:55.960 --> 0:08:00.160 are up to and specifically how you're doing it. Yeah. So, 0:08:00.360 --> 0:08:03.960 Transit Campus, we're we're really in two different business lines. 0:08:04.320 --> 0:08:08.120 One is payments, both tuition payments as well as non 0:08:08.160 --> 0:08:12.480 tuition payments on higher ED generally higher ED campuses. So 0:08:13.080 --> 0:08:17.400 we have the software that UH handles really parents are 0:08:17.440 --> 0:08:20.000 students going into to make all of their tuition, room 0:08:20.000 --> 0:08:23.320 and board type payments integrated deeply into the to the 0:08:23.440 --> 0:08:27.280 university systems. And then we have on campus things like 0:08:27.360 --> 0:08:32.360 point of sales software, mobile ordering KIOSK especially important right 0:08:32.440 --> 0:08:35.080 with kind of where the world's gone with contact lists. 0:08:35.080 --> 0:08:37.640 And then we have UM what we call campus i 0:08:37.760 --> 0:08:41.679 D so those ideas that students used to navigate in 0:08:42.040 --> 0:08:46.120 buildings but also contains UH stored value where they can 0:08:46.160 --> 0:08:49.760 load funds to actually transact on campus and also to 0:08:49.800 --> 0:08:53.040 some extent off campus leveraging those funds. And most of 0:08:53.080 --> 0:08:56.840 that we've really moved to a mobile credentials. So we've 0:08:56.840 --> 0:09:02.679 got about we've got about the universities twelve million plus 0:09:02.720 --> 0:09:06.080 students that we service in some capacity in those in 0:09:06.120 --> 0:09:09.680 those solutions. So twelve million students that you have some 0:09:09.840 --> 0:09:13.160 insight onto. I'm curious, you know this stop and start 0:09:13.360 --> 0:09:17.120 emerging from the pandemic. I mean, one of my in 0:09:17.280 --> 0:09:20.000 laws is still in college and it feels like, I 0:09:20.000 --> 0:09:21.960 don't know, trying to come back from winter break was 0:09:21.960 --> 0:09:26.120 definitely a difficult thing. To do as we as colleges 0:09:26.280 --> 0:09:29.360 try to emerge from the pandemic. What have you noticed 0:09:29.400 --> 0:09:35.000 in how that's affected students spending habits? Yeah, I mean 0:09:35.040 --> 0:09:37.120 I think in you tracked the spending habits, you know, 0:09:37.200 --> 0:09:41.040 tuition is always the largest obviously it's about forty thousand 0:09:41.080 --> 0:09:43.200 over four years, and then comes renting room and board, 0:09:43.240 --> 0:09:45.080 which is about seventeen thousand, and you get into the 0:09:45.120 --> 0:09:48.559 personal spending and I can't tell we have a a 0:09:50.280 --> 0:09:52.640 you know, deep deep knowledge, but I would say we've 0:09:52.679 --> 0:09:56.200 seen most of that trending pretty typical, you know, in 0:09:56.280 --> 0:09:59.679 terms of dining, you know, food being next probably for 0:09:59.800 --> 0:10:01.760 an dollars a month or so that they spend either 0:10:01.840 --> 0:10:04.400 on a meal plan. But you do see definitely an 0:10:04.440 --> 0:10:07.959 up to take no surprise in you know the grub 0:10:08.040 --> 0:10:11.720 hub or eats, you know, kind of restaurant delivery, meal, 0:10:11.960 --> 0:10:17.000 field delivery, kind of expenses that have kind of uh, 0:10:17.080 --> 0:10:22.079 you know, eclipsed what generally students have been been spending on. So, Nancy, 0:10:22.080 --> 0:10:24.360 I always wonder about, like, in terms of college spending, 0:10:24.360 --> 0:10:26.200 what kids are spending on. What does it tell you, 0:10:26.240 --> 0:10:29.440 if anything, about what's going on more broadly in terms 0:10:29.480 --> 0:10:32.319 of consumer spending or the you know kind of economic 0:10:32.360 --> 0:10:35.320 outlook or or sometimes I feel like colleges are just 0:10:35.640 --> 0:10:40.000 some extent insulated maybe from what's more broadly going on economy, 0:10:40.040 --> 0:10:43.120 but but maybe not so. So I'm curious how you 0:10:43.160 --> 0:10:46.640 see it. Yeah, I mean I would say, like I said, 0:10:46.679 --> 0:10:49.280 I think you see the trend in really convenience space 0:10:49.640 --> 0:10:53.200 spending right where where you know, they're spending a little 0:10:53.240 --> 0:10:57.640 more to have kind of contact lists, uh, kind of 0:10:57.880 --> 0:11:03.240 um delivery, whether it's it's food or other items. UM. 0:11:03.280 --> 0:11:09.000 I think that you know that they clearly are spending 0:11:09.080 --> 0:11:12.480 less on you know, kind of academic curriculum stuff, mostly 0:11:12.480 --> 0:11:14.280 because that's fun digital light that used to be a 0:11:14.280 --> 0:11:16.920 fairly high item for them, but that's lower. But they 0:11:16.920 --> 0:11:20.839 are spending more on you know, kind of personal expenses, 0:11:20.880 --> 0:11:23.520 and I think a lot of that goes to convenience 0:11:23.640 --> 0:11:25.480 based and some of that just kind of a trend 0:11:25.559 --> 0:11:27.760 with millennial but some of that I think is tied 0:11:27.800 --> 0:11:29.920 to kind of COVID and just what's gone on with 0:11:30.040 --> 0:11:32.080 you know, how we want to engage and make purchases 0:11:32.640 --> 0:11:34.120 and it's I want to talk a little bit about 0:11:34.200 --> 0:11:37.120 transact campus and uh, some of the deals that you've 0:11:37.120 --> 0:11:41.080 made recently because you've announced some new partnerships with Apple, Google, 0:11:41.240 --> 0:11:45.559 grub Hub. Really the list goes on. Yeah. So so 0:11:45.640 --> 0:11:49.199 when you think about our mobile credential, which today again 0:11:49.320 --> 0:11:52.040 it it holds the stored value that a student would 0:11:52.120 --> 0:11:54.080 use to make purchases, but it's also what they used 0:11:54.080 --> 0:11:57.680 to kind of navigate securely through campus, and it was 0:11:57.720 --> 0:12:01.360 critical that we embedded that and integrated that first into 0:12:01.400 --> 0:12:04.679 both the Apple and Google wallet. So that's that's, that's 0:12:04.720 --> 0:12:07.880 you know, just um kind of table stakes in terms 0:12:07.920 --> 0:12:10.880 of having those kind of partners with you know, with 0:12:11.040 --> 0:12:14.560 the population that that we serve. And then you look 0:12:14.559 --> 0:12:16.680 at you know, we have point of sales software on 0:12:16.760 --> 0:12:20.200 campus and we have mobile ordering, you know, which which 0:12:20.240 --> 0:12:23.040 is in kind of a closed campus environment, but wanting 0:12:23.080 --> 0:12:25.800 to extend that out to where they can leverage that 0:12:26.640 --> 0:12:30.840 outside of campus um at at merchants, but also through 0:12:31.000 --> 0:12:34.120 a grub hub or we're speaking with Uber eat store Dash, 0:12:34.360 --> 0:12:37.920 all of those, Uh, just makes sense in terms of 0:12:37.960 --> 0:12:42.400 how students really want to make perstances and transact right 0:12:42.440 --> 0:12:44.280 a broad array of offerings and the more you can 0:12:44.320 --> 0:12:47.040 kind of load it becomes kind of a full service. Hey, Nancy, 0:12:47.040 --> 0:12:49.559 thanks for the update. Nancy Langer, she's CEO a TRANSAC 0:12:49.640 --> 0:12:53.240 campus on the phone from Phoenix, Arizona. So one of 0:12:53.240 --> 0:12:56.800 the stories that definitely is a must read today. It's 0:12:56.800 --> 0:12:59.200 also among our most righte on the Bloomberg Today. It 0:12:59.240 --> 0:13:01.559 has a line. It's starts with US business is getting 0:13:01.559 --> 0:13:04.319 ready for long inflation. So let's get to it. Sean 0:13:04.400 --> 0:13:07.720 donnin Is Bloomberg New Senior writer for Economics on the 0:13:07.760 --> 0:13:12.000 phone in Maryland. Inflation. Inflation, inflation, Sean, your story is 0:13:12.040 --> 0:13:15.040 so relevant, especially when it comes to our discussions about 0:13:15.080 --> 0:13:16.640 what's going on in the economy and what we might 0:13:16.679 --> 0:13:19.160 get from the Fed. Next. What are you guys hearing? 0:13:19.320 --> 0:13:22.360 What were you reporting on? Yeah? Look, I mean we've 0:13:22.400 --> 0:13:25.880 all been hearing about higher inflation for some time now, 0:13:25.960 --> 0:13:29.280 and I guess when you start calling around to US 0:13:29.320 --> 0:13:32.319 businesses and asking what they're expecting, their answer is you 0:13:32.360 --> 0:13:35.120 should expect to hear about it for a little bit longer. 0:13:35.480 --> 0:13:39.760 Uh maybe longer than a lot of people expect right now. 0:13:39.840 --> 0:13:42.679 And that's you know, this is a big question confronting 0:13:42.679 --> 0:13:46.080 the Federal Reserve at its meeting in March. It's going 0:13:46.080 --> 0:13:48.320 to get to work, and we're expecting it to raise 0:13:48.400 --> 0:13:51.800 interest rates. They really telegraphed that that's the beginning of 0:13:51.800 --> 0:13:54.360 a fight against the inflation. But that's going to take 0:13:54.400 --> 0:13:59.000 some time, economists say, And businesses are still looking at 0:13:59.040 --> 0:14:01.800 this year and think they're gonna have to deal with 0:14:01.960 --> 0:14:07.880 elevated inflation for some time. And sean, where do wage increases, 0:14:07.920 --> 0:14:10.720 you know, the cost of labor factor into this, because 0:14:10.720 --> 0:14:15.360 that's where inflation ticket really sticky, right exactly. And look, 0:14:15.440 --> 0:14:17.760 so already we've seen, uh, you know, a lot of 0:14:17.800 --> 0:14:20.760 people calling last year the you know, the return of 0:14:20.840 --> 0:14:23.400 the power of labor. We saw those strikes of places 0:14:23.440 --> 0:14:28.240 like John Deere that yielded some big wage increases for 0:14:28.240 --> 0:14:31.600 for workers there. But that's not over, if anything, that's 0:14:31.600 --> 0:14:34.560 building speed. And that's a big worry for the FED 0:14:34.600 --> 0:14:38.240 who worry about the kind of wage price spiral in 0:14:38.240 --> 0:14:41.240 other words, that as higher prices cause workers to add 0:14:41.640 --> 0:14:45.440 ask for higher wages, that leads to higher prices as 0:14:45.480 --> 0:14:49.080 companies try to pass on the cost of those higher 0:14:49.080 --> 0:14:53.040 wages and and so on. M you talked to, you know, 0:14:53.080 --> 0:14:55.240 I was talking to a guy called Brian Nelson who 0:14:55.440 --> 0:15:00.000 is works for an agricultural equipment parts maker called hcc UH. 0:15:00.040 --> 0:15:04.200 They're based in Illinois. Uh. They are a big supplier 0:15:04.240 --> 0:15:07.200 to John Deere. Uh, and you know what it's going 0:15:07.240 --> 0:15:10.080 to hurt him this year, he says, is he's going 0:15:10.080 --> 0:15:13.960 into wage negotiations with the U a W who just 0:15:14.080 --> 0:15:16.720 negotiated a new contract with John Deere, and he's expecting 0:15:16.760 --> 0:15:19.240 a lot of the same there. You talked to other folks, 0:15:20.160 --> 0:15:23.560 a lot of small manufacturers, and they're expecting UH to 0:15:23.680 --> 0:15:26.800 have to raise wages again pretty aggressively, just to keep 0:15:26.880 --> 0:15:29.960 up with the competition and to get out ahead of inflation. 0:15:31.000 --> 0:15:33.520 You know, Sean, I can't help but feel, especially coming 0:15:33.520 --> 0:15:35.800 off the financial crisis, we were in such a period 0:15:35.800 --> 0:15:38.800 of low inflation for so long that we were all 0:15:38.880 --> 0:15:41.640 kind of shocked by it, right, And then I wonder 0:15:41.720 --> 0:15:44.080 would we still be in that period of low inflation 0:15:44.760 --> 0:15:46.920 had we not gone through the pandemic, or were we 0:15:47.120 --> 0:15:51.160 starting to see signs that something was changing in our 0:15:51.200 --> 0:15:56.840 inflationary environment that was just different fundamentally. Well, look, I 0:15:56.880 --> 0:16:00.160 mean the big irony is that before the pandemic, the 0:16:00.240 --> 0:16:02.200 FED was really hoping to get a little bit more 0:16:02.240 --> 0:16:05.920 inflation in the economy, right. Uh. We we there was 0:16:05.960 --> 0:16:08.320 a hope that you get running the economy that they 0:16:08.360 --> 0:16:10.240 wanted to run the economy a little bit hotter. And 0:16:10.400 --> 0:16:13.480 President Trump certainly made that point over and over again. 0:16:13.520 --> 0:16:16.320 He wasn't necessarily after higher prices, but he wanted faster growth. 0:16:16.320 --> 0:16:20.040 And we've seen that this time around with the response 0:16:20.160 --> 0:16:23.400 to the to the pandemic, the economic crisis side of 0:16:23.440 --> 0:16:26.960 the pandemic, that everyone has has done their work to 0:16:27.000 --> 0:16:30.920 get the faster growth and it's gotten this higher inflation 0:16:31.560 --> 0:16:34.360 that's there, and the big question now is how long 0:16:34.400 --> 0:16:37.280 that sticks around. One of the really interesting things right 0:16:37.320 --> 0:16:39.960 now is a really interesting note doubt from JP Morgan's 0:16:40.200 --> 0:16:44.400 chief economist UH last week making a point that we 0:16:44.920 --> 0:16:47.960 all of the models that we have now for inflation 0:16:48.600 --> 0:16:52.600 don't really explain what's going on now with inflation. And 0:16:52.640 --> 0:16:55.640 that raises a big question, and that is are we 0:16:55.880 --> 0:16:59.960 entering a new era of higher inflation or are we 0:17:00.040 --> 0:17:02.080 going to go back to what we saw pre pandemic? 0:17:02.120 --> 0:17:04.200 And a lot of economists are are betting that we're 0:17:04.200 --> 0:17:07.040 going to have higher inflation for longer and that's gonna 0:17:07.040 --> 0:17:10.600 have consequences for businesses and consumers and the economy as 0:17:10.600 --> 0:17:12.879 a whole for some time. And if we are heading 0:17:12.880 --> 0:17:15.160 into that environment, I mean you highlight in the piece 0:17:15.240 --> 0:17:19.119 that for some companies actually persistently high inflation, it's not 0:17:19.200 --> 0:17:23.440 so bad, right. I mean, if you're a Walmart and 0:17:23.920 --> 0:17:27.879 competitors are charging higher prices, there's an argument that and 0:17:28.080 --> 0:17:31.200 an argument that executives there make that that's actually good 0:17:31.200 --> 0:17:34.240 for business. It draws more customers uh their way. We 0:17:34.320 --> 0:17:38.760 also talked to the CEO of the price comparison site Trivago. 0:17:38.920 --> 0:17:42.639 He said, look, if people are are spooped by higher 0:17:42.640 --> 0:17:44.600 prices out there, they're going to spend more time on 0:17:44.680 --> 0:17:49.640 price comparison shot fights looking for for bargains. So there's 0:17:49.640 --> 0:17:52.280 always a little bit of an outside, but you know, 0:17:53.240 --> 0:17:56.879 it becomes a grind for for for a lot of families, 0:17:56.880 --> 0:17:59.000 and and that's something that we're going to have to 0:17:59.040 --> 0:18:00.879 get used to thinking to a little bit more about 0:18:00.880 --> 0:18:03.240 the purchases. I think we felt a lot of people 0:18:03.320 --> 0:18:07.440 felt flush through the pandemic. They weren't spending as much 0:18:07.480 --> 0:18:10.639 on commuting. They weren't they were getting the government stimulus 0:18:10.720 --> 0:18:12.359 checks and so on, and they were spending that on 0:18:12.520 --> 0:18:15.879 goods or home renovations, right, and so on. We may 0:18:15.960 --> 0:18:17.480 be entering a period where we have to think a 0:18:17.480 --> 0:18:20.080 little bit more about what we buy. Yeah, gosh, that's 0:18:20.119 --> 0:18:22.199 no no joke. Hey. I do also love in your 0:18:22.240 --> 0:18:25.000 story where you talk about this h c C president 0:18:25.040 --> 0:18:28.719 Brian Nelson and how because of higher inflation he had 0:18:28.760 --> 0:18:30.760 to put off his retirement because the board wanted this 0:18:30.880 --> 0:18:33.680 seven years seventy year old to stay on. Somebody who 0:18:33.760 --> 0:18:38.080 understood an inflationary environment just got twenty seconds. I mean, 0:18:38.080 --> 0:18:40.720 we're seeing this right. We want executives will understand this 0:18:40.760 --> 0:18:43.840 cycle just quickly. Absolutely, And Brian makes the point, Look, 0:18:43.880 --> 0:18:45.639 I went through this in the nineties, and I'm not 0:18:45.640 --> 0:18:47.960 freaking out this time because that's been through it before. 0:18:48.200 --> 0:18:50.199 He also does business in Brazil, and you know what 0:18:50.240 --> 0:18:52.520 he's doing. He's getting his people in Brazil to treating 0:18:52.520 --> 0:18:54.720 these people in the US and how to deal with inflation, 0:18:55.240 --> 0:18:58.000 how to ask customers for higher prices. Alright, good stuff. 0:18:58.000 --> 0:19:00.479 Shawn Donna and senior economics writer up bloom News on 0:19:00.520 --> 0:19:02.920 the phone in Maryland. You're listening to Bloomberg Business Weeek 0:19:02.960 --> 0:19:08.120 Carl Master, Katie Greifeld, and this is Bloomberg Radio. Well, 0:19:08.200 --> 0:19:10.840 the future is schmir so, says our next guest website, 0:19:10.880 --> 0:19:13.520 who founded Better Brand. It's a company that's attracted investments 0:19:13.560 --> 0:19:17.520 from Reddit co founder Alexis o'hanian, also the grandson of 0:19:17.600 --> 0:19:22.480 Wendy's founder excuse me, Dave Thomas, also actress Emmy Rossum 0:19:22.480 --> 0:19:24.600 and more. Here with what she is doing to create 0:19:24.680 --> 0:19:27.480 the Better Bagel is Amy Yang. She's founder of the 0:19:27.520 --> 0:19:29.639 Better Brand and she's on the phone in l A. Amy. 0:19:30.000 --> 0:19:31.840 Nice to have you here with Katie and myself here 0:19:31.840 --> 0:19:34.600 on Bloomberg Radio. So tell us about your company and 0:19:34.600 --> 0:19:37.640 what you're up to. Hey guys, thanks so much for 0:19:37.800 --> 0:19:40.600 having me and thrilled to be here. Um so yeah, 0:19:40.680 --> 0:19:43.400 to share a little bit more about Better Brand. We are, 0:19:43.600 --> 0:19:46.560 you know, a food tech company and leading innovation in 0:19:46.600 --> 0:19:50.119 the refined carb space. Right. So our mission is really 0:19:50.280 --> 0:19:53.560 creates a world where you know, we can eat freely 0:19:53.640 --> 0:19:57.720 without worrying about and weight gain or negative health consequences 0:19:57.760 --> 0:20:01.199 and and without having to compromise is on you know 0:20:01.280 --> 0:20:05.680 what in paste, text, or flavor or basically in any way. 0:20:05.880 --> 0:20:09.879 And you know what better way to showcase that innovation 0:20:09.960 --> 0:20:13.919 and start them by turning the most car heavy food, um, 0:20:13.960 --> 0:20:16.879 you know, a bagel into the carb equivalent of let's say, 0:20:16.920 --> 0:20:22.320 two slices of banana. Sounds sounds really good. Sounds really good. Yeah, 0:20:22.359 --> 0:20:25.879 how exactly do you do that? Walk us through that process, because, 0:20:26.080 --> 0:20:28.960 like you said, to the same net carbs as two 0:20:29.119 --> 0:20:32.600 banana slices seem amount of protein as four eggs. That's 0:20:32.600 --> 0:20:36.280 what really caught my eye. Yeah. Yeah, you know, it 0:20:36.359 --> 0:20:38.919 was a long innovation journey and um, you know a 0:20:38.920 --> 0:20:42.119 lot of people referred to better brand as you know, 0:20:42.160 --> 0:20:44.600 the beyond need of cards, right, And I think that's 0:20:44.640 --> 0:20:47.360 a really great way of thinking about it and understanding 0:20:47.680 --> 0:20:49.840 you know exactly, you know, what we had to do 0:20:49.960 --> 0:20:52.360 to get where we are in terms of you know, 0:20:52.640 --> 0:20:55.920 on the focus on R and D there and so, 0:20:56.000 --> 0:20:58.439 but you know, to dive a little bit deeper, it 0:20:58.520 --> 0:21:02.840 really comes down to you know, um, preparatory ingredient formulation 0:21:03.040 --> 0:21:05.880 and in process. Okay, so I'm going to jump in 0:21:06.160 --> 0:21:09.440 when you say a proprietary ingredient formulation. It's a little 0:21:09.480 --> 0:21:11.000 bit of a red flag for me because I like 0:21:11.119 --> 0:21:13.720 to know what I'm eating and increasingly we're in a 0:21:13.760 --> 0:21:16.920 consumer space. We want to know how are the things 0:21:16.960 --> 0:21:20.040 we wear, who produces it, where it's made, who's manufactured, 0:21:20.119 --> 0:21:23.000 is it fair labor, is it sustainable? When it comes 0:21:23.000 --> 0:21:26.400 to food, we're equally increasingly looking at that. So tell 0:21:26.440 --> 0:21:31.399 me what you can tell us about Yeah, I agree, 0:21:31.400 --> 0:21:34.000 and I would actually think that with food it's even 0:21:34.040 --> 0:21:37.280 more important to be transparent, right because it's something that 0:21:37.280 --> 0:21:40.480