WEBVTT - FTX Lawyers Accuse SBF of Undermining Bankruptcy 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 Stanovk. 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 --> 0:00:13.640 plus technology, politics, economics, all partnising the power of Business 0:00:13.640 --> 0:00:17.119 Week reporters and editors, not to mention our journalists and 0:00:17.160 --> 0:00:19.600 analyst in more than one and twenty countries. You can 0:00:19.640 --> 0:00:23.200 download Bloomberg Business Week and iTunes, SoundCloud, or Bloomberg dot com. 0:00:23.400 --> 0:00:25.160 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 --> 0:00:31.440 YouTube and now also on Bloomberg Quick Take. Well, a 0:00:31.560 --> 0:00:34.479 most read story today on the Bloomberg in fact, several 0:00:34.520 --> 0:00:36.080 of the most read stores in the Bloomberg Today or 0:00:36.040 --> 0:00:39.440 again about the crumbling empire of Sam Bankman Freed. What 0:00:39.479 --> 0:00:41.880 in particular, though, Tim, is about the lawyers for the 0:00:41.920 --> 0:00:45.800 now bankrupt from f t X and concerns about its founder. 0:00:45.880 --> 0:00:48.200 It's a legal angle to this story, you right, Remember 0:00:48.280 --> 0:00:50.600 yesterday afternoon we've got some headlines on the Bloomberg terminal. 0:00:50.640 --> 0:00:52.760 They said that f t X was coming out and 0:00:52.800 --> 0:00:55.360 saying that Bankman Freed, Sam BigMan Freed has no ongoing 0:00:55.480 --> 0:00:57.800 role at f t X and he does not speak 0:00:57.840 --> 0:00:59.520 on behalf of f t X, f t x U 0:00:59.680 --> 0:01:02.520 s or or Alameda. And I made the comment that 0:01:02.560 --> 0:01:06.080 if you're bankruptcy attorney handling this bankruptcy, you probably don't 0:01:06.080 --> 0:01:08.120 want to see him tweeting the way that he's been tweeting. 0:01:08.120 --> 0:01:10.600 And it turns out, Um, that's actually the case. We 0:01:10.680 --> 0:01:13.440 got Steven Church with us. He's bankruptcy reporter for Bloomberg News. 0:01:13.520 --> 0:01:16.679 He joins us via zoom from our Wilmington, Delaware bureau. Stephen, 0:01:16.680 --> 0:01:19.200 we're getting some insight into what the lawyers for f 0:01:19.319 --> 0:01:22.319 t X um the case that they're making, and what 0:01:22.360 --> 0:01:24.360 they're coming out and saying in terms of the mess 0:01:24.360 --> 0:01:26.200 that they have to clean up. Right now, what do 0:01:26.280 --> 0:01:29.280 we learned this morning? Oh, we learned the main thing 0:01:29.520 --> 0:01:31.800 was that the lawyers believe that there was a huge 0:01:31.920 --> 0:01:35.839 mess that was unprecedented in terms of its corporate controls. 0:01:36.800 --> 0:01:40.200 Hold on, hold on, When you say unprecedented, you mean unprecedented. 0:01:40.240 --> 0:01:44.000 I mean we're talking en Ron world, Colm, Like, what 0:01:44.080 --> 0:01:46.080 are we talking here? Like going all the way? That's like, 0:01:46.760 --> 0:01:48.320 let's look at it this way. Um, and Ron was 0:01:48.360 --> 0:01:51.520 probably one of the worst corporate scandals corporate fraud scandals 0:01:51.640 --> 0:01:54.520 UM in US history, among the worst. The man who 0:01:54.640 --> 0:01:57.880 was charged with cleaning that up is now the CEO 0:01:58.400 --> 0:02:01.160 of f t X, and he says it's the worst 0:02:01.160 --> 0:02:06.080 thing he's ever seen. So, Steve Stephen, is it unprecedented 0:02:06.200 --> 0:02:10.639 in terms of lack of controls or non existent controls? Um? 0:02:10.680 --> 0:02:13.160 I think it'd be unprecedented in terms of the weak 0:02:13.440 --> 0:02:15.960 or and in some cases non existent controls, is what 0:02:16.040 --> 0:02:20.320 he's arguing. UM. The main thing that happened, uh, well 0:02:20.320 --> 0:02:22.520 to two big things happened this morning. They filed two 0:02:22.560 --> 0:02:26.960 important pieces of the two important court documents. One laid 0:02:26.960 --> 0:02:29.920 out the case for why they're in court, what the 0:02:30.000 --> 0:02:32.440 problem is, and how they hope to solve it, although 0:02:32.440 --> 0:02:34.520 they didn't have much detail on how they hope. Uh. 0:02:34.600 --> 0:02:38.120 The other thing they did was unusual. They asked the 0:02:38.240 --> 0:02:43.680 judge in Delaware to prevent the regulators in UM in 0:02:43.800 --> 0:02:46.960 Bahamas from taking control of the case in any way. 0:02:48.040 --> 0:02:50.400 So does that mean that it ensures that it will 0:02:50.440 --> 0:02:53.519 be handled in US bankruptcy court? Uh? No, it'll be 0:02:53.560 --> 0:02:56.480 split they the way these cases typically work because you 0:02:56.480 --> 0:02:59.320 have a giant, UH conglomerate that's you have a giant 0:02:59.360 --> 0:03:02.040 business that touches all corners of the planet. That's the 0:03:02.040 --> 0:03:06.080 way this one is. Usually the different courts work together, 0:03:06.120 --> 0:03:09.080 they get a protocol together, and they agree on how 0:03:09.120 --> 0:03:12.960 to handle creditors, how to handle lawsuits. We're at the 0:03:12.960 --> 0:03:18.440 beginning stages of this. The Bahamas case UH is smaller 0:03:18.480 --> 0:03:21.080 than the US case in terms of the in terms 0:03:21.080 --> 0:03:23.519 of the entities that are covered by it, So we're 0:03:23.560 --> 0:03:25.639 just at the beginning of it. Most likely the US 0:03:25.760 --> 0:03:28.560 will the U S Court here in Delaware will take 0:03:28.840 --> 0:03:31.640 the lead on that the lawyers in charge of that 0:03:31.720 --> 0:03:35.920 case have been complaining about um Uh. The way the 0:03:35.960 --> 0:03:38.520 former CEO has handled himself the last few days. Are 0:03:38.520 --> 0:03:42.800 we going to see him on on the stand? Unlikely? 0:03:42.880 --> 0:03:44.920 I doubt if he. If he will appear in the 0:03:45.160 --> 0:03:49.080 stand in the bankruptcy case, he would obviously be a 0:03:49.160 --> 0:03:51.240 hustile witness at that point because the lawyers are fighting 0:03:51.280 --> 0:03:54.680 with him about some of the things that he's been saying. UH. 0:03:54.960 --> 0:03:57.680 More likely you'll see the current CEO, the man who 0:03:57.760 --> 0:03:59.680 is in charge of of of and RON a few 0:03:59.760 --> 0:04:02.800 years go, take the witness stand if necessary. Over the 0:04:02.880 --> 0:04:07.680 last next few weeks. Steven, what happens to SPF. What 0:04:07.800 --> 0:04:12.800 could happen to SPF? That's the question everybody wants answered. Well, 0:04:13.080 --> 0:04:16.480 we know that in Manhattan, the U. S. Attorney's Office 0:04:16.520 --> 0:04:20.640 there is investigating the company. I got to believe that 0:04:20.720 --> 0:04:23.440 they will look at him specifically, so he may face 0:04:23.520 --> 0:04:27.720 criminal criminal at least a criminal investigation. There's no telling 0:04:27.720 --> 0:04:29.799 whether or not he'll be charged. Obviously it's way too early. 0:04:30.800 --> 0:04:34.720 But there's also an investigation in the Bahamas that's going 0:04:34.760 --> 0:04:38.039 forward as well. So one of the things that in 0:04:38.080 --> 0:04:40.960 the bankruptcy court is very likely to happen is the 0:04:41.040 --> 0:04:45.160 creditors will turn their sights on him and say, what 0:04:45.200 --> 0:04:48.080 money have you got given to us? You caused the problem. 0:04:48.120 --> 0:04:51.160 That's pretty routine in big cases where you have a 0:04:51.200 --> 0:04:58.120 scandal involving the CEO. Yeah, it's so fascinating. Um, you know, 0:04:58.360 --> 0:05:01.320 I think about this, Stephen, because you know, initially, I 0:05:01.320 --> 0:05:03.280 feel like in the earlier days of crypto we talked 0:05:03.279 --> 0:05:07.440 about the ability to avoid regulators and the law enforcement. 0:05:07.480 --> 0:05:10.400 We know subsequent to that that there is ways to 0:05:10.440 --> 0:05:12.920 track it all down despite what we thought was a 0:05:13.000 --> 0:05:15.880 lack of transparency. But will there be some difficulties and 0:05:15.920 --> 0:05:20.800 maybe understanding the relationships um among all the entities under 0:05:20.880 --> 0:05:25.200 f t x UH and in SPFS empire, or do 0:05:25.240 --> 0:05:29.360 you do I guess does law enforcement? The lawyers feel 0:05:29.360 --> 0:05:31.240 like they're going to be able to uncover a lot. 0:05:33.120 --> 0:05:35.679 I would not bet against all of the forces arrayed 0:05:35.720 --> 0:05:40.159 against SPF right now. These are very good lawyers and 0:05:40.720 --> 0:05:45.520 experienced investigators on both the Bahamian side and in the 0:05:45.600 --> 0:05:48.279 U S side. So they will probably be able to 0:05:48.360 --> 0:05:51.840 unravel much of it now, whether or not there are 0:05:51.880 --> 0:05:54.000 certain black boxes they can never get their hands on, 0:05:54.200 --> 0:05:57.440 that's possible, but I would guess that they'll be able to. 0:05:58.040 --> 0:06:00.240 They'll be able to lay blame where they think it 0:06:00.240 --> 0:06:04.120 should be, and they'll bring actions in court. Remember, creditors 0:06:04.160 --> 0:06:06.200 lost a lot of money, and so it's in many 0:06:06.240 --> 0:06:10.480 of those creditors interest to find cash that is hidden 0:06:10.800 --> 0:06:14.960 or UH lies in an asset somewhere. So there's a 0:06:15.000 --> 0:06:17.640 lot of money backing the lawyers who are trying to 0:06:17.680 --> 0:06:20.120 get back much of the money that was lost. When 0:06:20.160 --> 0:06:22.000 you say much just in the last thirty seconds that 0:06:22.040 --> 0:06:24.279 we have with you, what's it's hard to it's hard 0:06:24.320 --> 0:06:26.560 to estimate this and see the future. Of course, Steve 0:06:26.640 --> 0:06:27.800 and I would never ask you to do that, But 0:06:27.880 --> 0:06:32.920 what's a realistic expectation that customers could have. I it's 0:06:32.960 --> 0:06:36.280 way too early for me to to talk about that. Obviously, 0:06:36.400 --> 0:06:40.040 billions are at stake in this case. We don't even 0:06:40.080 --> 0:06:45.520 know how much money the U is actually that regulators 0:06:45.560 --> 0:06:47.680 and the lawyers can get their hands on. We don't 0:06:47.760 --> 0:06:51.080 know how much money will roll into the bankruptcy court 0:06:51.200 --> 0:06:54.719 that the bankruptcy court can then distribute. The lawyers said 0:06:54.720 --> 0:06:57.840 in their court papers they're collecting hundreds of millions of 0:06:57.880 --> 0:07:01.039 dollars or they think they've identified hundreds of billions of dollars. Right, 0:07:01.920 --> 0:07:04.280 all right, Well, we so appreciate your reporting. Stephen Church, 0:07:04.320 --> 0:07:08.000 bankruptcy reporter at Bloomberg News on zoom from our Wilmington, 0:07:08.120 --> 0:07:12.360 Delaware bureau. You're listening and watching Bloomberg. You're listening to 0:07:12.480 --> 0:07:16.440 Bloomberg Business Week with Carol Masser and Bloomberg Quick Takes. 0:07:16.520 --> 0:07:21.240 Tim Stinovic on Bloomberg Radio. The world continues to include COVID, 0:07:21.320 --> 0:07:22.880 which we know in some parts of the roles such 0:07:22.880 --> 0:07:26.480 as Johnic really continue to be a drag on economic 0:07:26.520 --> 0:07:28.440 growth and getting back to a more normal way of life. 0:07:28.520 --> 0:07:30.040 I will say, Tim, it does feel like in New 0:07:30.120 --> 0:07:33.080 York City as I was coming up, uh in the 0:07:33.120 --> 0:07:35.560 World Trade Center. I mean, there are a lot of 0:07:35.600 --> 0:07:37.600 people coming off the trains this morning. He does feel 0:07:37.760 --> 0:07:40.880 more back to normal, Yeah, especially on a Thursday Friday. 0:07:40.960 --> 0:07:42.960 We'll see if that's another story. Does get quiet, does 0:07:43.000 --> 0:07:45.000 get a little quieter. Hey, let's get into it and 0:07:45.040 --> 0:07:47.920 talk all things pandemic and other respiratory viruses as well. 0:07:48.080 --> 0:07:50.800 We've got Dr kosert a Lot joining us, Associate Professor 0:07:50.880 --> 0:07:54.120 of International Health at Johns Hopkins Bloomberg School of Public Health. 0:07:54.280 --> 0:07:56.520 The Johns Hopkins Bloomberg School Public Health is supported by 0:07:56.560 --> 0:08:00.200 Michael R. Bloomberg, founder of Bloomberg LP and Bloomberg Philanthropy US. 0:08:00.240 --> 0:08:01.880 A doctor to Lot joins us on the phone from 0:08:01.880 --> 0:08:04.920 Baltimore this afternoon. Dr Tolot, good to have you back 0:08:05.080 --> 0:08:08.240 with us. I want to start with this idea of um, 0:08:08.880 --> 0:08:10.800 what I talked about just in the tease that right there, 0:08:10.880 --> 0:08:13.120 this idea of a triple demic right now. I don't 0:08:13.160 --> 0:08:17.520 know about you, but I did not hear about rs 0:08:17.600 --> 0:08:22.600 V overwhelming hospitals, especially in pediatric areas, until this year. 0:08:22.640 --> 0:08:26.680 What's different about this year, Well, we haven't heard it 0:08:26.760 --> 0:08:30.200 quite so bad either. What's different about this year. There's 0:08:30.240 --> 0:08:33.240 a couple of things. UM. The first is this RSC 0:08:33.240 --> 0:08:36.719 season it's much earlier than we usually see it. UM. 0:08:36.920 --> 0:08:40.000 Usually RSC is a wintertime virus. We see it filling 0:08:40.080 --> 0:08:43.920 up pediatric hospitals in January and February, not in October 0:08:43.960 --> 0:08:48.560 and November. UM, so it's it's much earlier. And in addition, 0:08:48.679 --> 0:08:53.920 there's many more cases. UM. RSC season has been altered 0:08:54.240 --> 0:08:57.839 because of COVID, So when we were all staying home 0:08:57.920 --> 0:09:00.320 and when we were all wearing masks and kids we're 0:09:00.679 --> 0:09:04.600 not going to school, RSC really disappeared for for the 0:09:04.760 --> 0:09:08.200 better part of two winters. UM. Last year we had 0:09:08.400 --> 0:09:10.280 a big RSP surge in the summer and then it 0:09:10.320 --> 0:09:13.360 went away in the fall, which was really unusual. UM. 0:09:13.520 --> 0:09:16.120 And this year it started in the fall and it's 0:09:16.400 --> 0:09:18.760 much much higher. And part of the reason why it's 0:09:18.800 --> 0:09:22.640 so high is because so many people have not seen 0:09:22.760 --> 0:09:26.120 our as the in several years, our immunity has waned. 0:09:26.160 --> 0:09:29.160 We have cold like large numbers of babies who and 0:09:29.480 --> 0:09:32.720 young children who have never had it, so now everybody 0:09:32.800 --> 0:09:34.920 is getting it all at this tame. Yeah, that's scary stuff. 0:09:34.960 --> 0:09:37.080 My cousin has you know three year old who was 0:09:37.080 --> 0:09:39.760 in the hospital for five days with RSP thankfully is 0:09:39.880 --> 0:09:42.360 okay right now, Um, Dr Tolts, So what are we 0:09:42.400 --> 0:09:44.280 What are we to do as parents? What are we 0:09:44.360 --> 0:09:48.840 to do as we had to the holiday season recommendations. Well, um, 0:09:48.920 --> 0:09:50.959 you know, if you're six, stay home, if your child 0:09:51.080 --> 0:09:53.800 is sick, keep them home from school. Um, if they're 0:09:53.840 --> 0:09:56.240 old enough to be wearing masks, this might be a 0:09:56.240 --> 0:09:59.600 good time to be wearing a mask. Um. Unfortunately, we 0:10:00.080 --> 0:10:03.760 don't have vaccines for RSC yet, but hopefully we'll have 0:10:04.240 --> 0:10:09.200 at least adult ARC vaccines in the next few years. Um. 0:10:09.400 --> 0:10:13.840 We um, wash your hands, you know, all the good 0:10:13.880 --> 0:10:17.000 public health things that we've been told for for many 0:10:17.080 --> 0:10:19.720 years during cold and flu season. Dr tolt just got 0:10:19.760 --> 0:10:21.679 about a couple of minutes left here. So now we've 0:10:21.720 --> 0:10:25.360 got four vaccines COVID nineteen vaccines just switching gears here 0:10:25.720 --> 0:10:27.800 that are available in the US. You've got the Fizer 0:10:27.960 --> 0:10:30.800 bion tech and then the Maderna which are emin R 0:10:31.320 --> 0:10:34.679 messenger RNA vaccines. You've got nervavacs COVID nineteen vaccine is 0:10:34.720 --> 0:10:37.559 a protein subunit vaccine. And then you've got j and 0:10:37.640 --> 0:10:41.600 Jay's Jansen vaccine a viral vector vaccine and can be 0:10:41.640 --> 0:10:45.079 given in some situations. UM of a really nice listener 0:10:45.240 --> 0:10:47.880 is messaging us and his name is Michael, and he's saying, 0:10:48.000 --> 0:10:50.600 I'm wondering if novavax is as effective as the other 0:10:50.679 --> 0:10:56.240 vaccines for covid um. The Novavax vaccine was evaluated and 0:10:56.280 --> 0:10:59.800 seen to be very effective at preventing UM severe disease, 0:10:59.800 --> 0:11:03.400 how realizations and death, just like the other vaccines. Currently, 0:11:03.559 --> 0:11:08.280 the Novovaks booster is just a UM. It's the single 0:11:08.440 --> 0:11:11.920 strain UM, whereas the MR and A vaccines are now 0:11:12.240 --> 0:11:16.080 being given as two strains. The bi valent vaccine UM 0:11:16.440 --> 0:11:20.960 that is targeting the the omicon strains UM. But nova 0:11:21.160 --> 0:11:24.679 vacs does work very well and if you prefer to 0:11:24.720 --> 0:11:29.760 get more traditional vaccine UM, the novavax vaccine could be 0:11:29.760 --> 0:11:31.760 a good fit for you. If you want the bi 0:11:31.880 --> 0:11:35.600 valent vaccine to get the best filmacon protection that UM, 0:11:35.760 --> 0:11:37.400 then the m R and A vaccines might be a 0:11:37.400 --> 0:11:40.200 good place. Well. In just thirty seconds, because I took UM, 0:11:40.200 --> 0:11:42.480 I've been fiser all the way and I took the 0:11:42.520 --> 0:11:45.280 fifth vaccine and felt like I had covid for twenty 0:11:45.320 --> 0:11:48.160 four hours. He's also asking just to follow is there 0:11:48.240 --> 0:11:51.000 less of a chance for side effects or milder side effects? 0:11:51.000 --> 0:11:54.040 And just got about thirty seconds from the novavaxx. Yeah, 0:11:54.200 --> 0:11:57.560 the side effects maybe a little bit milder, yes, because um, 0:11:57.679 --> 0:12:01.079 but but the but the side effects generally are very 0:12:01.080 --> 0:12:05.359 short lived, no matter vaccine you get. Hand are um, 0:12:05.480 --> 0:12:07.880 you know, a small pipe to pay for being protected 0:12:07.880 --> 0:12:10.040 against COVID? Totally agree for me. It was like twenty 0:12:10.040 --> 0:12:12.280 four hours and I kind of bounce back. Um, we 0:12:12.440 --> 0:12:16.079 thank you, Michael, our viewer listener thanks you as well. 0:12:16.200 --> 0:12:19.480 Dr kosar to a Lot, Associate Professor of International Health 0:12:19.480 --> 0:12:21.640 at Johns Hopkins Bloomberg School of Public Health. And as 0:12:21.640 --> 0:12:24.480 we remind you, it is supported by Michael R. Bloomberg, Founder, 0:12:24.480 --> 0:12:27.920 Bloomberg LP and Bloomberg Philanthropies. Uh. She was joining us 0:12:27.960 --> 0:12:31.840 on the phone from Baltimore. This is Bloomberg Business Week 0:12:32.040 --> 0:12:35.960 with Carol Messer and Bloomberg Quick takes Tim Stinovic on 0:12:36.120 --> 0:12:39.440 Bloomberg Radio. As travelers get ready like Tim to to 0:12:39.640 --> 0:12:42.240 to take to the air at the holiday season gets underway, 0:12:42.240 --> 0:12:44.520 are Allan Levin in the new issue of Bloomberg Business 0:12:44.559 --> 0:12:47.439 Week takes a look at the glamorous air charter market 0:12:47.760 --> 0:12:50.160 the dark corners of that market. That is a story, 0:12:50.200 --> 0:12:52.280 by the way, also the Bloomberg Big take. Are you 0:12:52.280 --> 0:12:54.760 applying that I'm going to fly on a private jet 0:12:54.840 --> 0:12:57.880 somewhere for between forty and seventy thousand dollars for a 0:12:57.960 --> 0:12:59.920 round trip between the East Coast and the West coast. 0:13:00.040 --> 0:13:02.800 Ever works for you, I'm not going to be doing that, 0:13:02.920 --> 0:13:05.160 And especially after reading the story, I think it raises 0:13:05.160 --> 0:13:08.319 a lot of questions about what the charter industry looks like. 0:13:08.360 --> 0:13:10.560 We've got Joe Webber, the editor of Bloomberg Business Week 0:13:10.559 --> 0:13:13.000 with us in the Bloomberg Interactive Broker studio, and also 0:13:13.040 --> 0:13:16.400 Alan Levin Aviation Safety and f a reporter for Bloomberg News. 0:13:16.440 --> 0:13:19.320 He joins us on the phone from our Washington, d C. Bureau, Joel, 0:13:19.360 --> 0:13:21.160 I want to kick it over to you and just 0:13:21.400 --> 0:13:24.400 make a distinction at the beginning of the conversation about 0:13:25.160 --> 0:13:29.720 how we define illicit charter flights, because the definition is 0:13:30.280 --> 0:13:34.040 it's it's kind of murky, right, And that's why, um, 0:13:34.080 --> 0:13:38.920 I think the story is scary a right, Like I 0:13:38.960 --> 0:13:42.880 think people are getting on planes that they assume are 0:13:43.840 --> 0:13:49.160 fine and in the worst case scenarios. As Alan's reporting shows, 0:13:49.400 --> 0:13:53.880 UM learning in in disastrous ways that they're that they're 0:13:53.920 --> 0:13:58.439 not UM and it is murky UM. And that's I'll 0:13:58.480 --> 0:14:01.720 let Alan actually think the question in terms of like 0:14:01.760 --> 0:14:04.880 illuminating the very specific question that you have. But the 0:14:04.920 --> 0:14:07.000 bigger thing to me is just I think there are 0:14:07.400 --> 0:14:11.800 private private aviation has become almost sort of the shadow 0:14:12.760 --> 0:14:17.640 world that is very attractive. You can get places far easier, 0:14:18.080 --> 0:14:19.920 and all you need is a little bit more money 0:14:19.960 --> 0:14:24.480 than flying via normal one and it has revealed. Alan's 0:14:24.480 --> 0:14:27.640 reporting here reveals that it comes with a host of 0:14:27.840 --> 0:14:34.040 problems and worries. Alan. Yeah, yeah, that's that's correct, Um. 0:14:34.640 --> 0:14:38.880 And you know, in our world today, we can you 0:14:39.080 --> 0:14:41.120 assume when you get in, if you call an uber 0:14:41.360 --> 0:14:44.200 or you're getting a taxi, that it's sort of been 0:14:44.360 --> 0:14:47.200 vetted by the government. It's not perfect, but at least 0:14:47.240 --> 0:14:49.880 you know they're looking at it, and I think they're 0:14:50.000 --> 0:14:55.600 That assumption carries over into the charter world, not at least, 0:14:55.640 --> 0:14:57.240 you know, at least in part it's due to the 0:14:57.280 --> 0:15:00.560 fact that there are lots of apps you can get 0:15:00.600 --> 0:15:03.840 that will get you a charter flight, and some people 0:15:03.920 --> 0:15:07.640 just assume it's the same thing, but it's but unless 0:15:07.640 --> 0:15:09.360 you know what you're doing, it's really hard to tell 0:15:09.640 --> 0:15:15.640 the legitimate operators from the the ones who are not licensed, 0:15:15.680 --> 0:15:19.280 and you know, in some cases are really cutting corners 0:15:19.320 --> 0:15:22.120 on safety. I'm sorry, I'm just having like FTX flashbacks 0:15:24.200 --> 0:15:28.560 regulators and your accountability. You assume that parent has a 0:15:28.640 --> 0:15:32.280 fancy app that you know, and that it has ads 0:15:32.320 --> 0:15:35.560 that it's going to be okay. So this is really interesting. 0:15:35.600 --> 0:15:37.600 There's this also this this part in the piece, Allan, 0:15:37.840 --> 0:15:40.520 and you have just some you know, really heart wrenching examples. 0:15:40.520 --> 0:15:43.040 Marcy Wilhelm is somebody who spoke to you for the piece, 0:15:43.280 --> 0:15:48.360 tell us about her experience flying privately. Yeah, let me 0:15:48.400 --> 0:15:51.280 just start by saying, I've been covering air crashes for 0:15:51.320 --> 0:15:53.360 a couple of decades now, and this is really one 0:15:53.400 --> 0:15:58.440 of the most heart wrenching ones. Um, Marcy is was amazing, 0:15:58.800 --> 0:16:03.440 had an amazing success story. She had founded uh co, 0:16:03.560 --> 0:16:06.080 founded a healthcare company, and they'd sold it for almost 0:16:06.080 --> 0:16:10.880 two hundred million dollars. Was back in she'd been hired 0:16:11.240 --> 0:16:16.200 to be the CEO of the successor company, and um, 0:16:16.240 --> 0:16:18.760 you know, she had was going away on a long 0:16:18.800 --> 0:16:23.440 weekend to Nantucket with some friends from her house in Florida. 0:16:23.520 --> 0:16:28.640 They stopped in uh, South Carolina to pick up some 0:16:28.640 --> 0:16:34.320 some folks, and the plane essentially did not have breaks. 0:16:35.040 --> 0:16:40.000 And it's a fairly big corporate jet um with high 0:16:40.040 --> 0:16:42.440 speeds compared to some other planes, and it just went 0:16:42.600 --> 0:16:45.160 screaming off the end of the runway down an embankment 0:16:45.160 --> 0:16:49.920 and broke into pieces, killed both pilots and Marsien and 0:16:49.960 --> 0:16:56.560 her husband were both severely injured. And the what investigators 0:16:56.680 --> 0:17:00.240 came to learn very quickly was that the plane never 0:17:00.280 --> 0:17:04.560 should have been in service on many different levels. For 0:17:04.720 --> 0:17:08.440 one thing, uh, Marcy booked the fight on a legitimate 0:17:08.560 --> 0:17:15.240 charter operator, but they're required to um uh have you know, 0:17:15.320 --> 0:17:18.920 put each and every aircraft on their certification. This aircraft 0:17:19.080 --> 0:17:24.359 was not um But beyond that, it had dozens of 0:17:25.040 --> 0:17:29.399 maintenance items that weren't complete, most notably the brakes. And 0:17:29.440 --> 0:17:32.440 the most stunning thing of all is a mechanic had 0:17:32.560 --> 0:17:35.480 noticed that the brakes weren't working had put a bright 0:17:35.680 --> 0:17:39.160 orange placard kind of a sticky note if you will, 0:17:39.480 --> 0:17:42.440 on the brake panel right in front of the pilot's 0:17:42.440 --> 0:17:47.960 faces that said inoperable. Technically it said in op which 0:17:48.000 --> 0:17:51.840 is whatever you know, that's what everyone in aviation, no elemine, 0:17:51.840 --> 0:17:55.040 they should know what that means. And they still landed 0:17:55.080 --> 0:17:58.520 without the brakes and had this accident. How is this 0:17:58.640 --> 0:18:03.320 happening still in the year of our Lord? Like how? How? 0:18:03.359 --> 0:18:06.360 And why? What? What? What are the blind spots here? 0:18:07.560 --> 0:18:11.280 So you know, in the legitimate air charter world, I 0:18:11.280 --> 0:18:16.919 don't want to leave listeners confused. In the legitimate world, 0:18:17.000 --> 0:18:20.080 there is a ton of f a oversight. It's not perfect. 0:18:20.200 --> 0:18:24.720 Occasionally we see flaws, but you know, they're they're required 0:18:24.760 --> 0:18:29.560 to do everything from pilot training to drug testing employees, 0:18:29.640 --> 0:18:34.600 on and on and on. But there's a good, uh 0:18:34.960 --> 0:18:39.760 twenty thousand or so private jets that are privately owned 0:18:39.880 --> 0:18:45.120 in the US, and you know, let's say our business 0:18:45.320 --> 0:18:47.760 and you bought this jet and suddenly the costs of 0:18:47.800 --> 0:18:50.639 maintenance are adding up. You might say, well, geez, why 0:18:50.680 --> 0:18:55.720 don't we just rent it out, you know, to somebody. 0:18:55.920 --> 0:18:59.919 And if you do that, you're not following all those 0:19:00.000 --> 0:19:02.919 safety measures that the legitimate guys do. And from the 0:19:02.960 --> 0:19:05.840 outside of the plane it's almost impossible to tell the difference. 0:19:07.080 --> 0:19:09.640 And I guess I'm just wondering, why does it all 0:19:10.000 --> 0:19:13.320 fall through, you know, the hands of regulators or the 0:19:13.400 --> 0:19:16.320 f a A ultimately, UM, but I can see where 0:19:16.320 --> 0:19:19.840 the cracks are. So what's your advice to folks out 0:19:19.840 --> 0:19:24.359 there who might be interested in chartering. Well, it turns out, UM, 0:19:25.359 --> 0:19:28.919 the f a A partly in a reaction to this 0:19:29.320 --> 0:19:31.840 a few years ago, be in publishing a list of 0:19:31.880 --> 0:19:36.119 all the aircraft that are legitimately licensed to carry people 0:19:36.160 --> 0:19:38.760 for hire. So you can look that up. You have 0:19:38.800 --> 0:19:41.920 to go to if you google f a A Air 0:19:42.040 --> 0:19:45.879 charter Safety, you'll find a link to it. UH. There's 0:19:45.920 --> 0:19:50.159 a trade group that UM has been very involved in 0:19:50.160 --> 0:19:53.320 this as well. And there are also several private companies 0:19:53.359 --> 0:19:59.760 that do auditing of charter companies, UH sort of save 0:20:00.520 --> 0:20:04.280 the customer the hassle of doing that UM. And so 0:20:04.280 --> 0:20:08.119 so there are definitely ways to figure out who's legit 0:20:08.160 --> 0:20:12.720 and who's not. And we teased UM earlier that there's 0:20:12.720 --> 0:20:17.399 a connection between j B. Fox and uh BA Hollywood 0:20:17.480 --> 0:20:22.600 producer Peter Gruber, also the NBA and I think the NHL. 0:20:22.720 --> 0:20:26.399 So UM highly recommend that you check out this story 0:20:26.600 --> 0:20:28.600 in the upcoming issue of Bloomberg Business Week. Also on 0:20:28.600 --> 0:20:31.840 the Bloomberg terminal and at Bloomberg dot com because it's 0:20:31.920 --> 0:20:34.320 a um a really important one and a lot of 0:20:34.320 --> 0:20:36.840 detail there. From Allan Levin, our Aviation Safety and f 0:20:37.000 --> 0:20:40.320 A reporter, Allen, thank you. You're listening to Bloomberg Business 0:20:40.320 --> 0:20:44.160 Week with Carol Messer and Bloomberg Quick Takes. Tim Stinovic 0:20:44.640 --> 0:20:48.800 on Bloomberg Radio. Alex Barenka, technology reporter at Bloomberg News. 0:20:48.880 --> 0:20:51.119 She's got a great story in the new double issue 0:20:51.240 --> 0:20:54.600 of Bloomberg Business Week dealing with metal platforms. Alex is 0:20:54.600 --> 0:20:56.600 with us via zoom in l A. So, Alex, good 0:20:56.600 --> 0:20:59.679 to have you here. Tell us about your story. Yeah. So, 0:21:00.160 --> 0:21:02.560 we've heard a lot of kind of anger at the 0:21:02.600 --> 0:21:05.520 general economic conditions from all of the Internet companies like 0:21:05.600 --> 0:21:09.160 Meta that depend on digital ads, blaming the economy for 0:21:09.240 --> 0:21:11.640 the really bad quarters they've had over the last six 0:21:11.680 --> 0:21:14.880 months or so. This weekend in Business Week, I'm writing 0:21:14.880 --> 0:21:17.040 that there might be kind of a bigger reason that 0:21:17.200 --> 0:21:20.560 Meta in particulars ad business. Um, it has a big 0:21:20.600 --> 0:21:23.480 hole in it, and that pole is shaped like Apple. 0:21:24.119 --> 0:21:27.320 About a year ago, Apple changed its privacy policies for 0:21:27.359 --> 0:21:31.399 the iPhone that made ads on social media both harder 0:21:31.440 --> 0:21:35.400 to target specific people and harder to track the return 0:21:35.480 --> 0:21:37.919 on the spend on those ads, and a year in 0:21:38.280 --> 0:21:40.920 Meta has estimated that that's had a ten billion dollar 0:21:41.040 --> 0:21:43.840 hit on its pad business. And you know, myself and 0:21:43.880 --> 0:21:46.520 a lot of the analysts and insiders I spoke for 0:21:46.600 --> 0:21:50.359 this story would also argue that that's what's dragging Meta 0:21:50.440 --> 0:21:53.399 down to potentially it's there. It's third quite straight quarter 0:21:53.480 --> 0:21:57.359 of revenue declines. It's more Apple than the economy. UM 0:21:57.400 --> 0:22:00.520 and I tried to break that down for folks this week. Well, 0:22:00.640 --> 0:22:05.560 there's a stark chart included in your piece that shows 0:22:05.560 --> 0:22:09.000 how other companies are faring or projected to fair between 0:22:10.560 --> 0:22:15.160 two uh. TikTok, according to e Marketer, has a projected 0:22:15.240 --> 0:22:18.439 change of one fifty versus Meta down at the bottom 0:22:18.440 --> 0:22:21.720 of which protect a change of negative. Why is TikTok 0:22:21.800 --> 0:22:24.080 able to capitalize on something when you know they're using 0:22:24.080 --> 0:22:27.919 the same hardware and the same operating systems to deliver 0:22:27.960 --> 0:22:31.280 those ads. I think there's two key reasons so Meta, 0:22:31.480 --> 0:22:34.439 as you mentioned Facebook, Instagram, those are metas companies have 0:22:34.600 --> 0:22:38.160 historically been based on who you know your friend graph 0:22:38.280 --> 0:22:41.240 is how they derive kind of insights on you. Um 0:22:41.359 --> 0:22:43.960 and plus the information that they were able to glean 0:22:44.040 --> 0:22:46.600 from Apple to make sure that advertisers are reaching the 0:22:46.640 --> 0:22:50.080 people they want to reach. Picktok, on the other hand, 0:22:50.400 --> 0:22:53.720 Um has built out an ai UM kind of focused 0:22:53.720 --> 0:22:58.000