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