WEBVTT - Car Dealership Cyberattacks and a New AI Research Lab 0:00:01.800 --> 0:00:07.080 From Marhard where Innovation, Money and Power Collie in Silicon Valley, NBN. 0:00:07.400 --> 0:00:11.880 This is Bloomberg Technology with Caroline Hyde and Ed Ludlow. 0:00:25.960 --> 0:00:28.760 I Med Ludlow in San Francisco. Caroline hides off. This 0:00:29.280 --> 0:00:32.640 is Bloomberg technology coming up. Car dealerships across the US 0:00:32.880 --> 0:00:37.400 Wholt services after a cyber attack. Full coverage ahead class 0:00:37.479 --> 0:00:41.520 Open AI co founder Ilia Sutskiva announces a new AI 0:00:41.720 --> 0:00:42.520 research lab. 0:00:42.600 --> 0:00:44.480 We have that exclusive reporting. 0:00:44.680 --> 0:00:47.800 An AI video startup, hey Jen, hits a half billion 0:00:47.840 --> 0:00:51.159 dollar valuation in its latest funding round. We do discuss 0:00:51.520 --> 0:00:54.760 with the CEO a very quick check in on markets. 0:00:54.760 --> 0:00:57.400 The S and P five hundred very briefly hit the 0:00:57.440 --> 0:01:00.320 fifty five hundred historic mark and then pull back with 0:01:00.480 --> 0:01:03.160 flat on the Nasdaq one hundred. Broadly, we're kind of 0:01:03.200 --> 0:01:06.840 treading water after a US holiday. The story, though, is 0:01:06.920 --> 0:01:09.560 individual names in the AI infrastructure play. 0:01:09.600 --> 0:01:10.720 We are talking about. 0:01:10.480 --> 0:01:13.400 Dell, we are talking about super Micro, and of course 0:01:13.400 --> 0:01:15.240 we're talking about in video. Later in the show, we're 0:01:15.240 --> 0:01:18.120 going to bring you details of what played out twenty 0:01:18.160 --> 0:01:21.080 four hours ago on social media, Michael Dell saying that 0:01:21.480 --> 0:01:26.080 Dell is building an AI factory for groc and Xai 0:01:26.080 --> 0:01:28.559 and Elon Musk. Elon Musk coming back on social media 0:01:28.600 --> 0:01:30.760 and saying super Micro's part of the story as well, 0:01:30.800 --> 0:01:32.959 and you can clearly see super Micro the kind of 0:01:32.959 --> 0:01:35.000 biggest beneficiary of. 0:01:34.920 --> 0:01:36.080 That move that's coming up. 0:01:36.400 --> 0:01:38.800 The top story in terms of newsflow is what we 0:01:38.800 --> 0:01:41.319 were talking about a moment ago. Car dealers across the 0:01:41.400 --> 0:01:45.240 United States were affected by a second cyber attack this 0:01:45.360 --> 0:01:50.560 morning after an initial attack yesterday compromised the CDK software 0:01:50.840 --> 0:01:53.920 platform and halted business. These are some of the publicly 0:01:53.960 --> 0:01:58.160 traded dealerships and auto retailers that are impacted in the 0:01:58.240 --> 0:02:00.800 here and now or moving to the downs. Let's get 0:02:00.880 --> 0:02:04.520 to Bloomberg's Jef Stone on our cyber team. Okay, let's 0:02:04.520 --> 0:02:07.120 start with the latest, because it's moving quite quickly. There 0:02:07.160 --> 0:02:09.919 was a second report of an attack this morning. 0:02:10.120 --> 0:02:11.919 What do we know? That's right. 0:02:12.160 --> 0:02:15.440 This is a big, messy cyber attack. You mentioned there's 0:02:15.440 --> 0:02:19.359 a second incident just reported. That happens as this software 0:02:19.360 --> 0:02:22.000 provider that works with more than fifteen thousand dealerships around 0:02:22.040 --> 0:02:25.680 the country is already trying to recover from what looks 0:02:25.720 --> 0:02:27.800 like is going to be a pretty costly outage. The 0:02:27.960 --> 0:02:31.440 nature of the incident isn't quite clear yet. We know 0:02:31.480 --> 0:02:34.000 that dealers are waiting for more information from the company, 0:02:34.760 --> 0:02:36.200 but we know what looks bad. 0:02:36.800 --> 0:02:39.320 Jesse, as I said, you're kind of a key member 0:02:39.360 --> 0:02:43.280 of our cyber security team. What was the vulnerability here, 0:02:43.320 --> 0:02:46.160 What was the security breach and where did it happen? 0:02:46.440 --> 0:02:48.919 The nature of the breach the point of entry is 0:02:49.280 --> 0:02:54.640 certainly still under investigation, but this incident fits with a 0:02:54.680 --> 0:02:58.800 recent string of attacks, certainly in the healthcare sector that 0:02:59.160 --> 0:03:05.160 our targeting kind of customer service software providers and almost 0:03:05.160 --> 0:03:07.880 innocuous companies that a lot of your viewers won't think 0:03:07.880 --> 0:03:11.280 about on a daily basis. These companies sit at a 0:03:11.400 --> 0:03:15.160 key point in various supply chains, and when they are hit, 0:03:16.000 --> 0:03:20.080 there are ripple effects, costly ripple effects that have major 0:03:20.960 --> 0:03:23.679 impact throughout their supply chain. 0:03:24.320 --> 0:03:26.639 Jeff, as you know, I've covered the automotive industry for 0:03:26.720 --> 0:03:28.720 quite a long time, and I've learned so much about 0:03:28.760 --> 0:03:33.720 CDK fifteen thousand customers, front office, back office. But also 0:03:33.800 --> 0:03:36.120 like the names that have been impacted here on the 0:03:36.480 --> 0:03:40.520 name brand side are big ones like Subaru Toyota. What 0:03:40.600 --> 0:03:42.880 have the responses from the company's been and what have 0:03:42.920 --> 0:03:45.440 they actually been telling customers as well. 0:03:46.320 --> 0:03:50.400 Please give us time and some patients. We know that dealerships, 0:03:50.440 --> 0:03:54.280 like I said, are waiting for more instructions from their 0:03:54.320 --> 0:03:58.760 parent companies from CDK as this continues to unfold. For now, 0:03:59.360 --> 0:04:02.880 a lot of dealers are slower to make sales. We 0:04:02.920 --> 0:04:08.680 know that sales representatives are increasingly working with paper transactions 0:04:08.760 --> 0:04:12.680 rather than the quick automatic stuff that we've all become 0:04:12.800 --> 0:04:13.800 used to, so. 0:04:14.160 --> 0:04:15.000 It's very challenging. 0:04:15.000 --> 0:04:16.080 They're waiting for more information. 0:04:17.320 --> 0:04:17.640 Jeff. 0:04:18.200 --> 0:04:22.760 This is one hack in a series of hacks over 0:04:22.920 --> 0:04:24.760 years that you and I have discussed on the show. 0:04:25.360 --> 0:04:27.680 In terms of its scale, where does it sit in 0:04:27.720 --> 0:04:29.760 those that you've covered in recent years? 0:04:29.960 --> 0:04:33.760 Growing the healthcare sector, like I said, has been the 0:04:33.800 --> 0:04:36.520 main focus over the past year eighteen months or so. 0:04:37.520 --> 0:04:41.120 The cost of this, based on the number of dealerships 0:04:41.160 --> 0:04:44.679 certainly affected, seems to be high. 0:04:44.720 --> 0:04:45.599 We're waiting to see. 0:04:45.400 --> 0:04:47.720 If there will be any government action on this, or 0:04:47.800 --> 0:04:51.360 any guidance from the Department of Homeland Security, for instance, 0:04:51.760 --> 0:04:56.279 in terms of understanding the full scope of the incident, 0:04:56.360 --> 0:04:58.919 But for now it's still. 0:04:58.920 --> 0:05:02.560 Calculating blimbergs Jeffstone on a developing story. 0:05:02.640 --> 0:05:03.040 Thank you. 0:05:03.400 --> 0:05:06.720 Another big story we're tracking is over in China, where 0:05:06.720 --> 0:05:10.599 e commerce giants have been slashing prices and using celebrity 0:05:10.720 --> 0:05:15.800 endorsements to boost enthusiasm for the six one eight shopping festival. 0:05:15.839 --> 0:05:18.640 Bloomberg's Henry Wren joins us for more out of London. 0:05:19.400 --> 0:05:20.839 This is a new one for me, Henry. I've been 0:05:20.880 --> 0:05:24.160 reading about six one eight, But if you were to summarize, 0:05:24.160 --> 0:05:28.160 you'd basically say that the consumer in China is getting 0:05:28.800 --> 0:05:32.440 an unprecedented level of incentive this week from the big 0:05:32.440 --> 0:05:33.400 e commerce names. 0:05:34.440 --> 0:05:37.800 Yes, indeed, so we're seeing scenes that we have been expecting. 0:05:37.920 --> 0:05:41.240 For example, the price cuts. You know, PDD, which is 0:05:41.320 --> 0:05:43.880 known for its budget shopping site pindor Door, has been 0:05:43.960 --> 0:05:46.720 keen to let its customers know that it has been 0:05:46.720 --> 0:05:50.600 putting forward the steeper than ever price discounts. But also 0:05:50.640 --> 0:05:54.120 we've been seeing something that's very unexpected. Let's say, for example, 0:05:54.560 --> 0:05:57.520 JD dot COM's funder Richard Devil is appearing on live 0:05:57.560 --> 0:06:01.880 streaming e commerce and it's not humans actually it's a 0:06:01.880 --> 0:06:04.800 digital avatar of him. But also in the meantime, a 0:06:04.880 --> 0:06:08.359 pop star Rihanna, which is who is pretty famous and 0:06:08.480 --> 0:06:12.040 popular in mainland China, as wells since setting a Chinese 0:06:12.080 --> 0:06:15.240 style off pancakes in front of camera. So basically we've 0:06:15.279 --> 0:06:18.160 been seeing everything here with all sorts of promotions. 0:06:20.120 --> 0:06:22.680 We're talking about the names that we always discussed on 0:06:22.680 --> 0:06:27.320 this program, Baba, Pinduoduo, JD. That's the company side of 0:06:27.360 --> 0:06:30.400 the story, but there's also the Chinese consumer side of 0:06:30.440 --> 0:06:33.280 the story that we track so closely here on Bloomberg Technology. 0:06:34.080 --> 0:06:37.279 Is the idea that they're needing to discount so heavily, 0:06:37.400 --> 0:06:41.880 get so creative, I suppose in their incentive a sign 0:06:41.920 --> 0:06:43.880 that the Chinese consumer needs a bit of help. 0:06:45.320 --> 0:06:45.560 Yes. 0:06:45.600 --> 0:06:49.039 Indeed, so the story that we have been reporting what 0:06:49.120 --> 0:06:52.839 over is the Chinese consumers are still quite cautious in 0:06:52.920 --> 0:06:55.559 terms of picking deals, and this has been a trend 0:06:55.560 --> 0:06:58.120 that has been confirmed by this six to one eight 0:06:58.160 --> 0:07:01.440 event as well. The main messa across the merchants has 0:07:01.480 --> 0:07:04.440 been price cuts, which has been seen across those live 0:07:04.480 --> 0:07:08.200 streaming platforms as well as these three big companies. But 0:07:08.240 --> 0:07:10.840 also in the meantime we see local media reporting that 0:07:11.680 --> 0:07:16.080 some categories, for example, women's superos or luxury goods have 0:07:16.160 --> 0:07:19.880 been seen very high return and cancelation rates rates as 0:07:19.960 --> 0:07:22.960 high as seventy five percent to eighty percent, which really 0:07:23.000 --> 0:07:26.880 shows that consumers aren't quite cautious. Yes, they probably are 0:07:26.960 --> 0:07:30.480 spending because of those price cuts, those promotions, but they're 0:07:30.680 --> 0:07:34.040 pretty keen in terms of picking the cheapest deals, not 0:07:34.080 --> 0:07:36.520 necessarily the best in terms of quality. 0:07:37.760 --> 0:07:40.360 Blynd begs Henry Wren, who is all across the China 0:07:40.480 --> 0:07:51.040 tech beat, thank you so much. It's time now for 0:07:51.120 --> 0:07:54.920 talking tech and first up Masayoshi's Sun maybe on the cusps, 0:07:54.960 --> 0:07:58.600 but making a major investment in AI selling shareholders at 0:07:58.600 --> 0:08:01.600 the annual meeting, the SoftBank says they're looking for their 0:08:01.680 --> 0:08:04.760 quote next big move in tech. The comments come after 0:08:04.760 --> 0:08:08.000 the company saw a string of losses through the startup 0:08:08.160 --> 0:08:11.840 bets plus. Open Ai co founder Ilia Sutskova has announced 0:08:11.880 --> 0:08:16.000 a new venture called Safe super Intelligence. The company aims 0:08:16.000 --> 0:08:20.520 to create a secure, powerful AI system with no intentions 0:08:20.520 --> 0:08:24.360 to sell AI products or services like rivals Open Ai 0:08:24.600 --> 0:08:27.840 and Google currently doing. Satskova left open Ai in May, 0:08:28.040 --> 0:08:31.480 just shortly after the return of Sam Autman and the 0:08:31.520 --> 0:08:34.320 ouster he was involved in. And finally, Dell announced that 0:08:34.400 --> 0:08:36.760 it's building out an AI factory with the help of 0:08:36.840 --> 0:08:42.120 Nvidia to power Elon Musk's XAI with super Microcomputer also 0:08:42.200 --> 0:08:45.040 providing servers. The two companies have been adding server capacity 0:08:45.080 --> 0:08:48.160 in recent months in an effort to win more businesses 0:08:48.559 --> 0:08:50.000 making AI expansions. 0:08:50.040 --> 0:08:51.480 Remember that I sat down with. 0:08:51.520 --> 0:08:55.560 Michael Dell last month, who defined an AI factory as 0:08:55.559 --> 0:08:57.360 the following you. 0:08:57.280 --> 0:09:04.600 Get into the ecosystem of all the software and the 0:09:04.679 --> 0:09:07.600 models that you're hearing about, the small and large models, 0:09:07.640 --> 0:09:12.800 the retrieval augmented generation. Of course, it's not just GPUs, 0:09:12.920 --> 0:09:16.920 it's also the networking by storage and the memory that 0:09:17.320 --> 0:09:18.000 come together. 0:09:19.080 --> 0:09:21.400 So let's be honest. That was a lot of buzzwords. 0:09:21.400 --> 0:09:23.000 But we're about to have a conversation where I think 0:09:23.000 --> 0:09:24.960 we can get to the root of what we're talking about, 0:09:25.200 --> 0:09:28.200 and that's with Nancy Tangler of Laffa Tengler Investments. And 0:09:28.240 --> 0:09:31.760 it's interesting, Nantie, because you actually got into Dell following 0:09:31.800 --> 0:09:34.559 earnings May thirtieth, and there was kind of a mixed 0:09:34.600 --> 0:09:38.800 reception to earnings. You know, there's a growth story there 0:09:38.880 --> 0:09:42.040 about AI infrastructure, and there were some near Turk concerns. 0:09:42.040 --> 0:09:45.000 But let's start with why you looked at Dell and thought, Okay, 0:09:45.280 --> 0:09:46.680 this is the move I'm going to make. 0:09:47.440 --> 0:09:50.319 Well, and thank you for having me a couple of reasons. 0:09:50.400 --> 0:09:52.720 I mean, we were late to the party, and that 0:09:52.760 --> 0:09:55.440 will happen from time to time. We've been late to 0:09:55.480 --> 0:09:57.720 other parties. But the point is that you get there. 0:09:57.880 --> 0:10:00.600 And we saw it as an opportunity to step in 0:10:00.920 --> 0:10:04.439 not just on the data center side of the business, 0:10:04.480 --> 0:10:07.679 but the PC upgrade cycle part of the business. And 0:10:07.760 --> 0:10:10.600 so if you look at the hyperscalers they are they 0:10:10.640 --> 0:10:14.360 are spending or spent about two hundred million dollars two 0:10:14.400 --> 0:10:19.200 hundred billion, sorry dollars on AI in their budgets, and 0:10:19.240 --> 0:10:22.360 so we think the use cases are real, the technology 0:10:22.440 --> 0:10:25.280 is real, the monetization is real, and so this was 0:10:25.320 --> 0:10:28.640 an area we were underweight hardware in our tech exposure, 0:10:28.760 --> 0:10:30.920 and this was an area where we could jump in. 0:10:32.280 --> 0:10:36.240 So you do not hold in Nvidia, which is really interesting. 0:10:36.840 --> 0:10:39.320 The big story we're talking about this morning is what 0:10:39.400 --> 0:10:42.760 played out on social media Wednesday that Michael Dell posted 0:10:43.000 --> 0:10:46.680 they're building an AI factory for Xai to power groc 0:10:46.840 --> 0:10:50.320 and Musk responds and says, well, actually super Micro's involved 0:10:50.360 --> 0:10:53.640 as well, So let's do some math, which actually my 0:10:53.640 --> 0:10:56.960 colleagues are Bloomberg Intelligence kindly walked me through this morning. 0:10:57.360 --> 0:11:00.440 If this deal is for Grock three has. 0:11:00.320 --> 0:11:02.360 Said in the past he'll need one hundred thousand, h 0:11:02.360 --> 0:11:05.440 one hundreds for that. And if you assume the average 0:11:05.440 --> 0:11:08.040 price of a rack a server racks about a million dollars, 0:11:08.320 --> 0:11:11.240 there are thirty six in Vida GPUs in each rack. 0:11:11.600 --> 0:11:14.400 You'll need twenty seven hundred racks. That could mean one 0:11:14.400 --> 0:11:17.600 point five billion dollars in bookings for both Dell and 0:11:17.760 --> 0:11:21.360 sm or super Micro. If BI is right about the 0:11:21.360 --> 0:11:24.760 three billion dollar deal value. So you don't hold in Nvidia, 0:11:24.800 --> 0:11:27.600 but you kind of do indirectly through Dell. 0:11:28.160 --> 0:11:28.800 Is that fair? 0:11:29.840 --> 0:11:32.880 Yes, I'm going to take that because you know, it 0:11:33.240 --> 0:11:36.160 seems silly to not be in Nvidia. We have very 0:11:36.160 --> 0:11:39.480 strict valuation metrics, and so I'm waiting for the hedgies 0:11:39.559 --> 0:11:42.240 to go to the Hamptons and then hoping we'll get 0:11:42.280 --> 0:11:45.480 a pullback an Nvidia. But yeah, I think I think 0:11:45.559 --> 0:11:48.600 that is the important thing to be thinking about. That 0:11:48.600 --> 0:11:52.120 that the investment cycle, as the large language models become larger, 0:11:52.760 --> 0:12:00.119 the power needed to generate the metrics around that that 0:12:00.240 --> 0:12:02.400 is going to augur well, not just for in Video, 0:12:02.480 --> 0:12:05.000 but for Dell and for Broadcom, which is we own 0:12:05.040 --> 0:12:07.480 the poor man's in video, which is which is broad Coom, 0:12:08.200 --> 0:12:10.640 and I'm pretty happy with that holding it's up sixty 0:12:10.640 --> 0:12:13.040 five percent year to date or seventy. But you know 0:12:13.080 --> 0:12:15.600 that's that pales in comparison to in Vidia one hundred 0:12:15.600 --> 0:12:17.160 and seventy percent. 0:12:17.600 --> 0:12:20.800 On the valuation question when last I checked. I don't 0:12:20.840 --> 0:12:21.800 have it in front of me now, but I think 0:12:21.800 --> 0:12:24.240 in video trades is something like forty five times, yes, 0:12:24.600 --> 0:12:26.520 twelve month forward earning something like that. And so so 0:12:26.559 --> 0:12:29.800 it's a rules based issue for you. You just called 0:12:29.800 --> 0:12:33.920 Broadcom the poor man's in video because you just extrapolate 0:12:33.920 --> 0:12:34.160 a bit. 0:12:34.440 --> 0:12:35.920 Why you'd say that. 0:12:36.000 --> 0:12:38.400 Well, it's I mean, it's certainly not as much in 0:12:38.440 --> 0:12:41.880 the sweet spot. But Hoktan, who by the way, is 0:12:41.920 --> 0:12:45.400 the highest paid CEO in corporate America. He is a 0:12:45.600 --> 0:12:48.320 master operator of the business. So they've already made you know, 0:12:48.400 --> 0:12:50.800 VMware has been on the books for a quarter. It's 0:12:50.800 --> 0:12:54.559 a creative It smooths out the hardware cycle, and they 0:12:54.600 --> 0:12:58.720 will be facing some competitions, certainly from in Nvidia in 0:12:58.760 --> 0:13:01.640 the networking side of their business. But we just think 0:13:01.760 --> 0:13:04.360 it's a company that it has paid. I mean, we've 0:13:04.400 --> 0:13:06.400 owned it for a long time. It's a member of 0:13:06.400 --> 0:13:09.720 our twelve Best Ideas portfolio, and we continue to like 0:13:09.760 --> 0:13:13.160 it here it's the cheapest of the group. And I 0:13:13.200 --> 0:13:18.840 love these old economy or old technology names like Broadcom, Oracle, Dell, 0:13:19.240 --> 0:13:22.800 who have remade themselves. And that's thanks to strong management 0:13:22.840 --> 0:13:25.440 teams who pivoted when they should have pivoted, just like 0:13:25.520 --> 0:13:29.280 Satya Nadella did at Microsoft, which is another twelve Best 0:13:29.320 --> 0:13:30.280 Ideas named for us. 0:13:31.240 --> 0:13:34.680 One of the other top top stories on Bloomberg today 0:13:34.800 --> 0:13:38.280 is this research note from City and they argue that 0:13:38.679 --> 0:13:43.000 AI is going to displace more jobs in the banking 0:13:43.120 --> 0:13:46.400 sector than any other sector. And I was looking across 0:13:46.480 --> 0:13:50.920 your portfolio, and you have this twelve Best Ideas portfolio. 0:13:50.160 --> 0:13:51.760 Which includes Goldman Sachs. 0:13:52.040 --> 0:13:54.440 So if we stick with the AI theme, what do 0:13:54.480 --> 0:13:57.080 you make of that City call that it's going to 0:13:57.080 --> 0:14:00.600 be in banking where an impact of the world forces 0:14:00.679 --> 0:14:01.720 most felt from AI. 0:14:02.160 --> 0:14:04.240 Yeah, I don't think it's going to be the Goldman 0:14:04.360 --> 0:14:06.920 side of banking. You know, I've been in this business 0:14:06.960 --> 0:14:09.400 for forty years at and I've heard all sorts of 0:14:09.480 --> 0:14:12.920 prognostications about what will happen that never happens. 0:14:13.320 --> 0:14:13.920 I think. 0:14:15.280 --> 0:14:20.640 Artificial intelligence will augment workers, and particularly the kind of workers, 0:14:20.760 --> 0:14:24.560 professional workers that Goldman employs. So I don't think it's 0:14:24.600 --> 0:14:28.120 a bank teller, robo call, you know, side of the 0:14:28.160 --> 0:14:32.120 business that that will be potentially impacted. But that's not Goldman, 0:14:32.200 --> 0:14:35.040 at least not anymore. When sin Save exited retail banking, 0:14:35.360 --> 0:14:37.560 and we think the M and A activity is certainly 0:14:37.600 --> 0:14:38.920 going to accelerate, So. 0:14:39.520 --> 0:14:40.680 We still like it here. 0:14:40.720 --> 0:14:44.360 It's still very cheap based on our work, and so 0:14:44.840 --> 0:14:46.520 you know, I'm not worried about that. 0:14:48.920 --> 0:14:51.280 Henry Wren, who covers China tech for US, was just 0:14:51.320 --> 0:14:55.520 on talking about the Chinese consumer and how many of 0:14:55.560 --> 0:14:58.960 the big Chinese technology names are doing heavy incentive this 0:14:59.080 --> 0:15:02.760 weight week. If there's one thing that keeps Nancy Tangler 0:15:02.840 --> 0:15:04.640 up at night, I think I'm right in saying that 0:15:04.680 --> 0:15:08.760 it's the consumer broadly. But I guess principally in this country. 0:15:09.120 --> 0:15:11.560 Why is it such a concern to you the state 0:15:11.600 --> 0:15:12.320 of the consumer. 0:15:12.560 --> 0:15:15.760 Well, so I think there's two consumers. There's the baby 0:15:15.760 --> 0:15:19.000 boom consumer, which I'm a member of, who has half 0:15:19.080 --> 0:15:22.360 of the country's net worth, and so they're spending. They're 0:15:22.400 --> 0:15:26.080 retired generally speaking, and they're not being impacted by this. 0:15:26.160 --> 0:15:29.120 They have big stock portfolios, but it's the low end 0:15:29.120 --> 0:15:33.600 consumer that's just getting crushed by you know, sticky inflation, 0:15:33.680 --> 0:15:35.440 which is still with us. You know, only on Wall 0:15:35.440 --> 0:15:37.960 Street do we say, oh, inflation is declining because the 0:15:38.040 --> 0:15:41.120 rate of rate of change is going up less fast 0:15:41.240 --> 0:15:44.560 than it was previously. So I think it's wearing on them. 0:15:45.160 --> 0:15:48.280 The interest expense, the access to credit, all of this 0:15:48.360 --> 0:15:50.840 is declined. And then we know that, you know, full 0:15:50.880 --> 0:15:53.360 time jobs declined in March year over year by two 0:15:53.400 --> 0:15:58.280 hundred and seventy five thousand hours work declined, wages in 0:15:58.360 --> 0:16:02.520 terms of our average hour, the earnings declined. So this 0:16:02.600 --> 0:16:05.520 is a problem spot for the economy. And the low 0:16:05.600 --> 0:16:08.840 end of the consumer is end mass much greater in 0:16:08.920 --> 0:16:11.640 numbers than the baby boomers. So I think we have 0:16:11.720 --> 0:16:13.600 to watch this. And the retail sales numbers that they're 0:16:13.640 --> 0:16:18.240 not comprehensive, we're disappointing, and the revisions down we're also disappointing. 0:16:19.600 --> 0:16:23.000 Earning season is once again around the corner. It's silly 0:16:23.040 --> 0:16:27.359 to say, take that concern and give me your expectations 0:16:27.360 --> 0:16:29.200 to technology earnings in particular. 0:16:29.480 --> 0:16:31.480 Oh, I think tech's going to continue to shine and 0:16:31.600 --> 0:16:35.080 Just for the record, we've been advocating overweighting tech since 0:16:35.120 --> 0:16:37.400 the fall of twenty twenty two, when everyone rode it 0:16:37.440 --> 0:16:41.240 off once again as not the place you wanted to be, 0:16:41.320 --> 0:16:43.880 that the tech trade was over, that higher interest rates 0:16:43.880 --> 0:16:46.800 were going to hurt technology companies, because that was an old, 0:16:47.440 --> 0:16:50.280 old school view of the world. But in fact, most 0:16:50.280 --> 0:16:53.600 of the megacap tech names have benefited from higher interest rates. 0:16:53.760 --> 0:16:55.560 So we think earnings is going to continue to be 0:16:55.600 --> 0:16:58.400 a bright spot through this year and into next. And 0:16:58.840 --> 0:17:02.320 so we want to own, you know, the hyperscalers, We 0:17:02.360 --> 0:17:04.960 want to own the hardware companies. And you know they 0:17:04.960 --> 0:17:08.000 wrote off software a few weeks ago, but just wait 0:17:08.040 --> 0:17:09.840 a few weeks and I think the hedge fund guys 0:17:09.840 --> 0:17:13.760 will be back in buying software. So there's my cynical 0:17:13.840 --> 0:17:15.879 view of the way this world works. 0:17:17.119 --> 0:17:17.600 Cynical. 0:17:17.720 --> 0:17:20.199 Maybe I appreciate the omission that you elate to the 0:17:20.240 --> 0:17:22.840 party on Dell, but in the end, you made it 0:17:22.840 --> 0:17:25.800 to the party, and that is what matters. Nancy Tengler 0:17:25.920 --> 0:17:29.080 of Lappetengler Investments, thank you so much. Stick with us, 0:17:29.080 --> 0:17:48.160 We'll be right back. This is Blimberg Technology. Eight former 0:17:48.200 --> 0:17:51.680 employees of SpaceX who were fired in twenty twenty two 0:17:51.800 --> 0:17:56.200 after writing an open letter criticizing Elon Musk. Have now 0:17:56.240 --> 0:18:01.040 filed a lawsuit against SpaceX and CEO mask edging sexual 0:18:01.080 --> 0:18:04.520 harassment and retaliation. We spoke with one of the plaintiffs 0:18:04.560 --> 0:18:06.560 in the suit, Paige Holland Feelin. 0:18:07.359 --> 0:18:11.679 SpaceX employees are encouraged to follow SpaceX and to follow 0:18:11.680 --> 0:18:15.800 Elon Musk on Twitter, and in my orientation, we were 0:18:15.920 --> 0:18:18.320 encouraged to follow him on Twitter. In the employee handbook, 0:18:18.400 --> 0:18:21.359 it mentions that his Twitter feed is a source of 0:18:21.359 --> 0:18:24.920 official company news that's allowed to be shared with the public. 0:18:25.560 --> 0:18:27.240 So if you if you're not following him on Twitter, 0:18:27.240 --> 0:18:32.160 then you're missing things, and actual delivery dates and deadlines 0:18:32.200 --> 0:18:36.959 and functions of entire teams and departments are impacted day 0:18:37.000 --> 0:18:38.639 to day by what he decides to tweet. In the 0:18:38.640 --> 0:18:42.800 middle of the night, he decided to, you know, put 0:18:42.800 --> 0:18:46.560 out a return to office order and talk about it 0:18:46.600 --> 0:18:52.560 on his Twitter, and that became the law. And you know, 0:18:52.600 --> 0:18:55.800 a friend of mine had a Starship delivery date changed 0:18:55.840 --> 0:18:59.200 overnight because it was on Twitter. So now it's now 0:18:59.200 --> 0:19:02.480 it's law. So it's not just the nonsense, but the 0:19:02.520 --> 0:19:06.680 stuff that impacts people's actual day to day work functionality 0:19:06.840 --> 0:19:10.840 is tweeted about, and then since he's already said it 0:19:10.840 --> 0:19:14.680 and it's public, it's now written into the official plan. 0:19:15.560 --> 0:19:18.840 It was interesting that you said you felt like an 0:19:18.840 --> 0:19:23.480 outside another because that you're female. But many would say, look, 0:19:23.520 --> 0:19:27.360 the person actually running the show, the CEO, Gwyn shotwell, 0:19:27.840 --> 0:19:31.720 female too. How is her voice not allowing your voice. 0:19:31.520 --> 0:19:32.360 To be heard? 0:19:33.600 --> 0:19:35.760 She is very much part of the problem. I think 0:19:35.800 --> 0:19:40.679 that she comes from a generation of just a different 0:19:41.760 --> 0:19:45.600 perspective maybe, but she's so ingrained in the culture there 0:19:45.800 --> 0:19:49.880 and the lifestyle that she's not willing to. 0:19:51.320 --> 0:19:52.760 Rock the boat at all at this point. 0:19:53.920 --> 0:19:56.120 She's very much not the adult in the room that 0:19:56.320 --> 0:19:58.200 the rest of the world kind of makes her out 0:19:58.200 --> 0:20:01.240 to be. She is a huge part of the problem. 0:20:01.359 --> 0:20:04.760 I think it's this brand of kind of I want 0:20:04.760 --> 0:20:08.560 to say, like girl boss feminism that doesn't really uplift 0:20:08.600 --> 0:20:14.120 those around you. Doesn't feel the need to open your 0:20:14.119 --> 0:20:17.159 eyes to the very real concerns of people around you. 0:20:18.640 --> 0:20:21.080 She likes when people have conversations you pay. She will 0:20:21.119 --> 0:20:25.120 focus on a one counterpoint to a valid argument as 0:20:25.119 --> 0:20:29.560 a means of dismissing the entire argument, which is disingenuous 0:20:29.720 --> 0:20:31.200 and really in bad face. 0:20:32.359 --> 0:20:36.000 You have that full suit, and I'm interested to know 0:20:36.080 --> 0:20:39.160 what you hope to get out of this page. 0:20:39.840 --> 0:20:44.840 Accountability most of all. But I think I think accountability 0:20:44.920 --> 0:20:50.520 because the leadership forms the culture so much, and because 0:20:50.560 --> 0:20:55.160 it's such a painful place to work, and having being 0:20:55.200 --> 0:20:57.320 working at SpaceX and open doors for you elsewhere, and 0:20:57.359 --> 0:20:59.399 so it's really amazing opportunity, and I don't think that 0:20:59.400 --> 0:21:04.520 that opportunity should be constrained to the people who are, 0:21:05.880 --> 0:21:12.600 you know, the typical engineering demographic. There are voices and 0:21:13.600 --> 0:21:15.959 perspectives to be heard that can contribute in a meaningful 0:21:15.960 --> 0:21:18.320 way that don't you know, look like the status quo. 0:21:18.400 --> 0:21:23.440 But aside from that, I think speaking up and telling 0:21:23.520 --> 0:21:26.720 my story hopefully will help other people who you know, 0:21:26.800 --> 0:21:28.760 look around them and don't see anyone else that looks 0:21:28.760 --> 0:21:31.920 like them and don't know that their experiences aren't isolated 0:21:31.960 --> 0:21:35.560 to their own experiences, can speak up and share the 0:21:35.600 --> 0:21:37.520 stories around them. I'm hoping to kind of open up 0:21:37.520 --> 0:21:41.760 the platform to let people of all marginalized groups have 0:21:41.800 --> 0:21:44.800 these conversations and feel safe, because I think it's fundamentally 0:21:44.840 --> 0:21:46.280 it should be a human right to feel safe in 0:21:46.280 --> 0:21:46.760 the workplace. 0:21:48.359 --> 0:21:51.639 Bloomberg Technology reached out to SpaceX and Elon Musk for 0:21:51.720 --> 0:21:54.760 comment on the suit and the allegations made by Holland Feelen, 0:21:54.840 --> 0:21:58.400 but they did not respond. SpaceX has previously denied any 0:21:58.400 --> 0:22:01.679 wrongdoing and said that the fired employees involved in the 0:22:01.760 --> 0:22:05.240 case violated policy. It also said Musk himself was not 0:22:05.320 --> 0:22:09.560 involved in those terminations. Gwinshortwell also didn't comment. We continue 0:22:09.600 --> 0:22:11.879 to track the story and if SpaceX want to talk, 0:22:12.160 --> 0:22:24.560 they're always welcome on the show. This is Bloomberg. Welcome 0:22:24.560 --> 0:22:27.679 back to Boomberg Technology. Ed Ludlow in San Francisco. A 0:22:27.720 --> 0:22:29.199 quick check in on the market, So I always go 0:22:29.280 --> 0:22:32.160 to the NAZE one hundred. It's kind of this tech 0:22:32.240 --> 0:22:36.080 heavy index, a lot of higher multiple names AI as 0:22:36.080 --> 0:22:38.479 a story plays out, but we are essentially flat as 0:22:38.480 --> 0:22:40.960