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Speaker 1: Six investment bankers walk into an arts studio. No, that's

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Speaker 1: not the start of the joke. Turns out they needed

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Speaker 1: to feel safe and be left alone to do what Well,

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Speaker 1: feel safe and be left alone with their thoughts or

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Speaker 1: waste of time? Hardly who knew these folks were also needy?

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Speaker 1: Aren't they? The masters of the universe? Amy Whittaker of

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Speaker 1: New York University tells us why Amy's written about and

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Speaker 1: taught the intersection between finance, economics, and art. Welcome to

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Speaker 1: Bloomberg Benchmark, a show about the global economy. I'm Daniel

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Speaker 1: moss I write and edit global economics for Bloomberg View,

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Speaker 1: and I'm Scott Landman and economics editor with Bloomberg News

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Speaker 1: in Washington. Amy, it's so great to have you with us.

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Speaker 1: Thanks so much for having me on. Great to be here.

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Speaker 1: You're the author of art thinking how to carve out

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Speaker 1: creative spice in a world of schedules, budgets and bosses.

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Speaker 1: Well we'll get to those last three qualifies in just

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Speaker 1: a second, but I want to come to this phrase

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Speaker 1: that you use that's originally attributed to Daniel Pink m

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Speaker 1: f I is the new MBI explain. I think It's

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Speaker 1: one of these things that relates to the stereotypes that

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Speaker 1: we all have of art business, and even the sexy

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Speaker 1: overlap of art and business. When Daniel Pink wrote that

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Speaker 1: in the Harvard Business Review in two thousand four, I

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Speaker 1: already had an m b A and I was studying

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Speaker 1: for an m f A and painting in London. I

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Speaker 1: would show up at the studio and my colleague painter

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Speaker 1: would be in three piece pen stripe tails, painting at

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Speaker 1: nine in the morning, having been out all night. And

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Speaker 1: that is not something that ever happened when I was

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Speaker 1: in business school. I think the idea is that creativity

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Speaker 1: is really important in business. So that's an idea we've

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Speaker 1: had at least since Shupiter. But the question is really

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Speaker 1: how culturally we make space for that. Now. Does the

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Speaker 1: m f A is a new m b A paradigm

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Speaker 1: survive the post two thousand a night world. The post

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Speaker 1: two thousand and eight world is a great example of

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Speaker 1: art as a really really broad process. This idea that

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Speaker 1: we live in a point a world and then something happens,

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Speaker 1: whether we do it ourselves or it happens outside of

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Speaker 1: our control, that completely turns the world upside down and

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Speaker 1: changes all of our assumptions the idea of the m

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Speaker 1: f A as the new m b A. On the

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Speaker 1: one hand, it survives in perpetuity because all of us

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Speaker 1: have a creative and a practical self and need more

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Speaker 1: space to own both. And on the other hand, you

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Speaker 1: could easily say that two thousight was the result of

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Speaker 1: overly creative thinking and markets and about risk. Now let's

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Speaker 1: let's go back to what Dan talked about at the top,

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Speaker 1: which was the six investment bankers who walk into an

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Speaker 1: art studio. How does your training in art square with

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Speaker 1: that picture that we're painting? That picture with words that

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Speaker 1: Dn just painted, and you invoted six, how many showed up?

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Speaker 1: I yielded six. I invited about thirty five. Now I

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Speaker 1: probably invited ten. The first year I was in art school,

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Speaker 1: we had a show at the end of the year,

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Speaker 1: and for some reason, honestly, probably dealing with my own

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Speaker 1: vulnerability getting back to making art after having an MBA,

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Speaker 1: I decided that there was this question of who's an

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Speaker 1: artist and what kind of work gets made. So think

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Speaker 1: of the kind of art you've seen that makes you

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Speaker 1: most skeptical about modern and contemporary art, Like a hundred

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Speaker 1: bicycle pump sealed in a can of large Joseph boys,

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Speaker 1: or something that's an event or a you know, a

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Speaker 1: broom and a bucket with an extensive wall label. I

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Speaker 1: was kind of thinking about the frame of art, and

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Speaker 1: I thought, everyone is an artist. Everyone's neatly creative. So

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Speaker 1: I invited some friends. None of them were actually investment bankers,

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Speaker 1: because the art studio building closed at ten pm and

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Speaker 1: none of the investment bankers are off work at that time.

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Speaker 1: It was investment managers and attorneys. And there are six

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Speaker 1: of them who came, and I have to say, you know,

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Speaker 1: the most important thing was to leave them alone and

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Speaker 1: let them do their own thing. And they were hilarious

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Speaker 1: and brave. There's a guy called Guy who was an

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Speaker 1: economist through and through, who came and made an abstract

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Speaker 1: artwork and then came back the second week and completely

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Speaker 1: changed the artwork in a way that requires all the

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Speaker 1: moral courage you'll ever bring to a painting. My own

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Speaker 1: tutor and art school stop by to tell me he

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Speaker 1: really liked the direction my work was taking, and uh,

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Speaker 1: I think it just reminded me that everyone has this

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Speaker 1: capacity to be an artist. And I mean that in

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Speaker 1: the sense of the exact moment you have a paint

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Speaker 1: brush in your hand and you have to put it

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Speaker 1: on a canvas. All of us have that moment in

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Speaker 1: our daily lives, in our time in the art studio,

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Speaker 1: figuratively speaking, and so it was really fun fun to

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Speaker 1: watch that. Now some of our listeners might and I'm

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Speaker 1: wrestling with this myself. It can sometimes seem a little

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Speaker 1: frivolous to link art to the serious, hard decisions that

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Speaker 1: take place in a safe suite. It's trilled down a

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Speaker 1: little bit. What is the link? I think we actually

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Speaker 1: live in a time when the art world is a

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Speaker 1: bit insulated from its own civic, economic, and political importance

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Speaker 1: outside of itself. When I talk about art, I don't

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Speaker 1: mean paintings and museums. I mean the human capacity for creativity,

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Speaker 1: the thing that will become increasingly important as work gets automated,

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Speaker 1: the thing that only people can do. So the way

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Speaker 1: I think about it is kind of folkasy, but it's

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Speaker 1: in terms of my parents and some thing that my

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Speaker 1: father once said he was a neurologist and our mother

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Speaker 1: is a medievalist. And he was once asked how they

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Speaker 1: got along being in such different fields, and he said,

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Speaker 1: He was in the business of saving lives, but she

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Speaker 1: was in the business of making lives where it's saving,

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Speaker 1: And I always loved that because they did the opposite.

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Speaker 1: He helped people with quality of life issues like headaches

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Speaker 1: and the inability to walk, and she helped people with

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Speaker 1: basic survival skills like writing and complete sentences. So I

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Speaker 1: think the reason art matters in the c suite is

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Speaker 1: because it represents a spaciousness of curiosity and skepticism. And

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Speaker 1: it doesn't matter a hundred percent. It matters in a

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Speaker 1: portfolio since that you just need some space for it.

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Speaker 1: You can think of it as the alternatives allocation in

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Speaker 1: your investment portfolio. You'd never want to be a hundred

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Speaker 1: percent in bitcoin, but you might want to own a

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Speaker 1: little bit of it. So what does that have to

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Speaker 1: do with the term creative destruction? You did mention Jupiter earlier.

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Speaker 1: He's credited with coining that phrase. Why is he so

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Speaker 1: important in your work? What does that have to do

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Speaker 1: with art? The idea of creative destruction, I think is

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Speaker 1: the original way that economics as a field grappled with

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Speaker 1: creativity because economics traditionally is based on the idea of competition.

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Speaker 1: So Sjupiter is making a case for creative destruction that

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Speaker 1: you have to think imaginatively or you will be competed away.

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Speaker 1: And I think all of us can relate to this

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Speaker 1: idea that ultimately there's no such thing as stasis. There's

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Speaker 1: a constancy of change. You know, if you had an

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Speaker 1: amazing haircut in night four, it's probably not still an

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Speaker 1: amazing haircut. If you had a great business model in

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Speaker 1: the industry you're in is evolved beyond that. So for me,

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Speaker 1: I'm less interested in the destruction part of it, which

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Speaker 1: is fear based, right, you better be creative or you're

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Speaker 1: going to be in trouble, and more about it as

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Speaker 1: a form of expansiveness and the root of being able

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Speaker 1: to bring your whole person or your actual sense of

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Speaker 1: self and judgment into the workplace. Now, one of the

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Speaker 1: words in the title of your book is budgets, And

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Speaker 1: the reason I'm raising that word specifically is most companies

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Speaker 1: like to talk about words like creativity and certainly give

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Speaker 1: voice to its importance. They also don't like to be

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Speaker 1: too dependent on one particular product. Yet number crunches can

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Speaker 1: kill an idea before it's even born. Now, with art,

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Speaker 1: you don't necessarily know what you're creating. So like, that's

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Speaker 1: even worse for a number crunch er, isn't it. It is,

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Speaker 1: It's terrible, it's the worst. It's it just is. But

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Speaker 1: it's the It's the kind of risk that's worth taking.

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Speaker 1: I think the worst thing that can happen in the

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Speaker 1: workplace is to get a perfect answer to a question

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Speaker 1: and then realize that you're asking the wrong question. In

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Speaker 1: the first place, a number cruncher can get a perfect

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Speaker 1: answer to the wrong question. I think the reason art

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Speaker 1: matters is that art is part of the compass. It's

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Speaker 1: part of the orientation for how you move forward when

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Speaker 1: you don't have a template, when the past patterns are

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Speaker 1: the only thing that will help you in the future.

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Speaker 1: And I don't think this idea is unrooted from expertise

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Speaker 1: in finance already Oslaft to motor in who teaches valuation,

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Speaker 1: and y U has a new book on narrative versus

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Speaker 1: numbers and the necessity of both. I'm in no way

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Speaker 1: of suggesting that you shelve your analytic self. I'm suggesting

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Speaker 1: that your analytic self is brought to life by the

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Speaker 1: other parts of yourself that are creative and imaginative amy.

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Speaker 1: One way maybe we can bring this discussion more into

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Speaker 1: global economics is to talk about a subject that we've

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Speaker 1: covered on this program before um, which is the you know,

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Speaker 1: why productivity has been so low in recent years, why

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Speaker 1: growth has been low in this recovery. We've had Robert

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Speaker 1: Gordon and Eric Brynjolfson on on the podcast before. Gordon,

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Speaker 1: as you probably know, talks about how technological advances haven't

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Speaker 1: compared in recent years to the ones that were you know,

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Speaker 1: say a hundred years ago, like the invention, invention of electricity, plumbing,

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Speaker 1: and so forth, you know, things that probably required some

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Speaker 1: of the art thinking that you mentioned. Do you feel

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Speaker 1: or have you seen that in a historic sense there

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Speaker 1: is less of this art thinking today that can drive

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Speaker 1: the economy or the economies of the world. I think

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Speaker 1: one of the challenges is that we live in an

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Speaker 1: era of short term measures of success quarterly earnings. Electricity

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Speaker 1: is a great example. Electricity. The original charity experiments were

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Speaker 1: not done with an outcome in mind. They were done

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Speaker 1: as a side project out of curiosity. No one really

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Speaker 1: understood how they would work and how important they would become.

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Speaker 1: There's a very beautiful essay called the usefulness of useless knowledge.

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Speaker 1: About this if you want to check it out. So

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Speaker 1: I think we lack the capacity right now for what

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Speaker 1: I would call a cathedral business. Not a business that

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Speaker 1: returned some money to venture capitalists in eighteen months to

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Speaker 1: four years, but businesses that are important and have the

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Speaker 1: kind of nobility of creating, you know, shar Tra or

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Speaker 1: Notre Dame. But we lack the ability to embrace that

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Speaker 1: time horizon. We lack the ability to be essentially value

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Speaker 1: investors in that particular sense. Now you've talked about companies here,

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Speaker 1: what about the people who populate the companies? What about

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Speaker 1: executives who are just stuck. They've had a great track record,

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Speaker 1: but they know they need to get to another place

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Speaker 1: to adapt to avoid their own destruction. How does art

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Speaker 1: help them? I think this is such a great question

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Speaker 1: because I think one of the difficulties in that scenario

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Speaker 1: is what you do once you've already been successful. And

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Speaker 1: this happens in anything. It definitely happens if you're making

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Speaker 1: a painting. But you develop a set of skills, they

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Speaker 1: serve you the new world it or requires a different

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Speaker 1: set of skills, or this is the creative instruction moment

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Speaker 1: where you have to edge out a little bit of

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Speaker 1: your past success to make room for a new experiment.

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Speaker 1: And I think the thing that we need the most

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Speaker 1: in that situation is culturally what I would call a

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Speaker 1: holding environment, a space in which it's okay to take

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Speaker 1: risks and to share vulnerability about moving forward. And most

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Speaker 1: workplaces don't have space for that. And has that gone

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Speaker 1: down in recent years? I mean, would you say, based

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Speaker 1: on your research, there's less of that happening today than

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Speaker 1: there wasn't the past, or or you know, how would

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Speaker 1: you characterize it? I think there's a delicate cocktail of

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Speaker 1: distractions of technology and enhance stabilities to measure outputs that

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Speaker 1: makes it really hard to have those conversations, because those

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Speaker 1: conversations sometimes feel like wasting time. New projects just feel

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Speaker 1: unfamiliar and slightly ridiculous, And at least for me, if

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Speaker 1: I if I come up with a good idea, there

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Speaker 1: like just bad. And to be able to have colleagues

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Speaker 1: identifying the questions and values that are driving you from

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Speaker 1: the outset, so that once you get to those ridiculously

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Speaker 1: bad ideas, you can discuss them without it feeling serious

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Speaker 1: know why you're having the conversation, and if that's established,

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Speaker 1: then there's a lot more space for kind of working

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Speaker 1: To get back to the executive for a second, how

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Speaker 1: many seasoned executives who have spent decades at the same

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Speaker 1: art to take a leap to destination known? Aren't they

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Speaker 1: trying to have some sense of what the destination is?

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Speaker 1: But you seem to be saying forget all that. The

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Speaker 1: premise of art thinking is that if you're making a

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Speaker 1: work of art in any field, you're not going from

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Speaker 1: a known point A to a known point B. You're

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Speaker 1: inventing point B. And a manager, seasoned manager in a

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Speaker 1: large corporation has a portfolio of projects. You can picture

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Speaker 1: BCG growth share matrix. They're all the different boxes of

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Speaker 1: things that you know, the cow and the dog and

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Speaker 1: the star and the question mark, and what we're talking

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Speaker 1: about here is a part of the whole. We're talking

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Speaker 1: about the question mark. We're talking about the things that

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Speaker 1: have high potential but are not yet demonstrated. And I

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Speaker 1: think that the biggest thing I would say to that

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Speaker 1: executive is that we have archetypes right now of what

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Speaker 1: little bit outdated. We picture someone who's a guru, and

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Speaker 1: Steve Jobs is an amazing human being in an incredible

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Speaker 1: visionary But I think what we actually need, or what

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Speaker 1: I would call good enough managers, managers who can hold

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Speaker 1: the space for their teams to rise up and solve problems.

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Speaker 1: I think most of the challenges that corporations and even

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Speaker 1: society space are so large they're not solved by individual people.

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Speaker 1: So this idea of the kind of mythic artist or

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Speaker 1: the gallant, imaginative CEO are are really doing us a

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Speaker 1: disservice in terms of harnessing the collective intelligence of the team.

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Speaker 1: And are these the kinds of things that can you know,

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Speaker 1: boost the size of a company, boost profits, boost jobs,

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Speaker 1: and help the economy in general. Well, I think that

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Speaker 1: we're really talking about value. When I think of art,

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Speaker 1: I think about the creation of value. So there are

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Speaker 1: many different things that boost jobs and profits that are

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Speaker 1: not about the creation of value. They can be about,

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Speaker 1: you know, making bad investments that don't get over your

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Speaker 1: hurdle rate, but that grow the size of your kind

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Speaker 1: of net income. Or they can be about uh, you know,

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Speaker 1: risk taking or extraction of value or short term profiting.

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Speaker 1: I think what we're really talking about are things that

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Speaker 1: create long term value across many different categories of what

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Speaker 1: value is. And I can imagine that that sounds naively

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Speaker 1: idealistic to someone who has been running a division of

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Speaker 1: a company or a company for a long time, But

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Speaker 1: I actually think that there's room in the portfolio of

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Speaker 1: the managerial skill set for kind of willful impracticality and

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Speaker 1: idealism that if managers aren't making space for that, then

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Speaker 1: who is. There's room for that, but will they actually

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Speaker 1: make space for it. It's the question that's why there's

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Speaker 1: a portfolio of view to this. This is why, and

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Speaker 1: I'm working on this now, but why we need to

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Speaker 1: create r o I dashboards or return on asset dashboards

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Speaker 1: internally that include a wedge of the pie that serves

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Speaker 1: creative work and that can be measured in a number

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Speaker 1: of different ways. There's a company called to sixty one

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Speaker 1: that embeds artists incorporations and they measure the output in

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Speaker 1: terms of reduced cycle time on R and D. So

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Speaker 1: there are lots of ways to quantify and measure, but

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Speaker 1: they're often process based measures or their value measures that

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Speaker 1: are not pure short term profit. I mean, this is

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Speaker 1: a this is a real challenge in the economy, and

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Speaker 1: I think the reason I think it's important to name

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Speaker 1: is not just kind of idealistically to name it, but

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Speaker 1: to say, you know, these are the questions we need

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Speaker 1: to answer. These may not be the questions we have

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Speaker 1: perfect data for, but they're the questions we actually need

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Speaker 1: to grapple it now. In your book, you also bring

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Speaker 1: cinema into this. You talk about Dallas, Bias Club and

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Speaker 1: Inside Out, two movies which don't seem to have a

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Speaker 1: lot in common. What's the lesson there? Well, I have

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Speaker 1: to say it's a It's a book with a lot

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Speaker 1: of different topics in it, and everyone who writes a

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Speaker 1: book should have the privilege of having their book translated

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Speaker 1: into Chinese by this lovely man and Yon fang. You will,

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Speaker 1: you will, You're about to tell us that you have

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Speaker 1: right I have. Well, it's the most humbling thing that's

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Speaker 1: happened to me in many years. And editing a book

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Speaker 1: is humbling for anyone who's telling you the truth. But

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Speaker 1: having your book translated by Jan Fayg, you're like, yeah,

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Speaker 1: these are pretty disparate examples. I do need to do

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Speaker 1: a little bit across cultural explaining. So Dallas Buyer's Club

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Speaker 1: and Inside Out come from really different parts of art

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Speaker 1: thinking framework. Dallas Buyer's Club encapsulates the idea of the producer,

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Speaker 1: and we know what movie producers are, but the idea

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Speaker 1: of the producer is broader than that. And it's anyone

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Speaker 1: in a corporate environment who's taking on the secondary creative

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Speaker 1: work of commercializing an idea or making it economically viable.

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Speaker 1: So you have this brainstorming moment you come up with

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Speaker 1: something amazing. The producers the person who actually brings it

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Speaker 1: into reality, and their job is incredibly resourceful, involves ingenuity

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Speaker 1: instant and these two instances. The producers of Dallas Buyer's

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Speaker 1: Club had a roughly four million dollar budget. Matthew McConaughey,

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Speaker 1: the lead in the movie had lost thirty eight of

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Speaker 1: forty pounds, getting ready to play an emaciated person ravage

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Speaker 1: by the HIV virus. They had to call him right

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Speaker 1: before they were set to shoot to say that their

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Speaker 1: funding had fallen through and that they have to postpone,

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Speaker 1: and in the most relatively angry moment I've heard of,

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Speaker 1: he said, polately, you'll have to figure that out, kind

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Speaker 1: of hung up the phone, and they did. And the

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Speaker 1: way they figured it out is that they cut the

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Speaker 1: entire lighting budget of the film, which saved them about

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Speaker 1: a million dollars. If you watch that movie, it's naturally lit,

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Speaker 1: which I think gives it a gritty authenticity that is

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Speaker 1: part of its effectiveness. The head and a code to me,

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Speaker 1: I'll have to watch it again very quickly. Inside Out.

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Speaker 1: Inside Out is an example of Pixar's brain trust process

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Speaker 1: idea of radical candor and warmth of feedback. Uh The

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Speaker 1: a director of the film, was three years into the

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Speaker 1: development process, couldn't figure out the central question, was afraid

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Speaker 1: he'd lose his job, thought about how that would affect

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Speaker 1: his life, and made a huge pivot to be able

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Speaker 1: to move forward in what was really important about it.

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Speaker 1: So it's an example of being able to identify the

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Speaker 1: question and the value system and the the warmth of

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Speaker 1: the interaction around creative work. Amy last question, is there

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Speaker 1: a hope for corporate America without this kind of art

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Speaker 1: thinking that you've been that you've been talking about. I

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Speaker 1: would like to think that there's a hope for corporate

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Speaker 1: America no matter what, because corporate America is really a

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Speaker 1: collection of people who happen to work inside companies. Economics

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Speaker 1: is based on the theory of the firm, and I

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Speaker 1: think the firm is like a cow, and corporations are

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Speaker 1: like a bunch of people inside a cal costume trying

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Speaker 1: to behave like a cow. So I have tremendous faith

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Speaker 1: in people ultimately and in the capacity of people collectively

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Speaker 1: to build the world that we are want to live in.

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Speaker 1: So we end on a hopeful note. Amy, thank you

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Speaker 1: so much for joining us. Thanks so much for having me.

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Speaker 1: Benchmark will be back next week. Until then, you can

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Speaker 1: find us in so many places the Bloomberg terminal, Bloomberg

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Speaker 1: dot Com, our Bloomberg app, as well as iTunes, pocket casts,

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Speaker 1: and Stitcher. While you're there, take a minute rate and

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Speaker 1: review the show so more listeners can find us and

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Speaker 1: do let us know what you've thought. You can follow

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Speaker 1: me on Twitter at Moss Underscore, Echo, Scott at at

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Speaker 1: Scott Laman, and Amy at the Amy Wit That's Easy.

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Speaker 1: Benchmark is produced by Sarah Pattison. The head of Bloomberg

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Speaker 1: Podcast is Alec McCay. Thanks for listening, See you next time.

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Speaker 1: Four