This is Bloomberg Business. Wait 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.
Hi, everyone, Welcome to the Bloomberg Business Wee Weekend Podcast. Another week where there were still YEP earnings more than a dozen retailers, and then Tim, we know the big one and video.
Yeah, people use the term blowout quarter a lot. This was actually a blowout quarter.
For Invidia, absolutely and the stock was moving on the news. All right, we'll kind of get to that a little bit later. On politics also front and center, as former President Donald Trump, Rudy Giuliani and others turned themselves into Georgia authorities as part of the criminal case related to the twenty twenty presidential election. And then of course, the Kansas City Fed's annual gathering and Jackson Hole put monetary policy front and center again.
With the economy in mind, we'll floor the cost of climate change and extreme heat when it comes to American productivity in addition to their deadly toll on our fellow citizens.
Plus more details on the highly anticipated IPO of the British ship designer ARM Holdings, and why the company needed more than thirty five hundred words in its prospectus to explain the risks it faces when it comes to China.
All that to come, we begin with the past week's kickoff to the twenty twenty four presidential election, as eight Republican hopefuls squared off in their first debate in Milwaukee, with each looking to break Donald Trump's grip on the party's voters, and yet only one seems to really be trying, former New Jersey Governor Chris Christy.
We have to dispense with the person who said that we need to suspend the Constitution to put forward his political career. Mike Pence said no, and he deserves credit for it.
That was former Governor Christy going after the former president and praising the and Vice President Mike Pence on the debate stage. Yet here in lies the rub. Long before Christy devoted himself to stopping Trump, he helped annoy him, becoming the first Republican candidate to drop out and endorse Donald Trump back in twenty sixteen.
Head of the debate and writing about Chris Christi. In this week's issue of Bloomberg BusinessWeek is the magazine's national correspondent Josh Green, who offered up some insights into the long shot strategy.
As I was looking at the race, of looking at the field, one guy stood out, and now was Chris Christie. Because Christy is a famously aggressive debater, very effective. He's a big, larger than life character, and this cycle he's the only Republican character who's really going after Donald Trump with both barrels. So it looked like that this could be a kind of inflection point in the race, one
that kind of lent itself to Christie's talents. And so I went and traveled with him around South Carolina and New Hampshire, talked to him about what his plan had been and how he had gone from being an important Trump endorser in twenty sixteen to today running against him as Rum's loudest critic.
Tell us about your time spent with Chris Christy and what you kind of took away from that. And I am curious about how you maybe challenged him about Wait a minute, you were his friend, now you're his critic. Are you going to go back to being his friend?
Talk to us about that.
Yeah, I mean it was fascinating from kind of an anthropological standpoint because I went down to South Carolina with Christy. You know, Trump is very popular with Republicans still, and so I was expecting a lot of kind of Trump maga people to be in there shouting down Christy and all sorts of confrontations, and instead what I found was
just the opposite. It was almost like a group therapy session of you know, Republicans, some of who'd driven for hours and even from other states to kind of come and commune with Christy and kind of find the crowd of people who were Republicans but didn't like Donald Trump. There's sort of fewer and fewer numbers these days, and all of them were sort of worshipful of Chris Christie.
So it's really interesting to see that for all that we see on the news and on social media about how popular Trump continues to be, despite indictments, despite impeachments, there still is a group of Republicans who are never Trumpers and who are hoping that Trump won't be the nominee in twenty twenty four. I think the problem for Christie and the challenge for Christie is that there aren't enough of them to win him the nomination.
That's what I was just going to have a broader appeal. Yeah, I was just going to ask you if there are enough of those to actually help him get a nomination. I mean, in an alternate universe, certainly, you know that could work. So, Josh, what about Chris Christy today? Who is he and sort of how did he recover from what happened at the end of his term with the old you know, time for some traffic problems in Fort Lee.
Thanks, exactly what I mean. Look, let's remember, you know, Christy at one point was the rising star of the
Republican Party before Donald Trump came along. Popular blue state governor could have run for president against Obama in twenty twelve, chose to wait and then wound up in trouble with the George Washington Bridge scale that tarnished the end of his president But he jumped in anyway in twenty sixteen and looked like a viable candidate until Trump came along and kind of stole his shtick as kind of the confrontational outer borrow you know, poke a finger in your
chest guy. He just did it better and So when Christy recognized that he wasn't going to be the nominee, he made a move to become Trump's VP and became the first guy to endorse him. And so that shocked a lot of people because at the time, it's.
Like, can I just say, it's like watching the Bachelorette, and you know, it's that bachelorette that just doesn't have a chance, but like just going for the rose, it was like pain.
And instead it went to Mike Pence, and he wound up kind of getting humiliated. He got fired from Trump's transition, and I think his reputation was really kind of in tatters, you know, as the Trump administration went off the rails, a lot of people, Republicans and Democrats, I think, scorned
Christie for having enabled Trump. And so one of the things that I think is going on, and I get at this and the piece and I talked to Christie about it, is is he really running for the Republican nomination? Does he really think he can be Trump? Or is
he really aiming here for personal redemption? Because if he does manage to stop Trump, even if he himself is not the nominee, I think a lot of people will be very thankful and that he'll in a sense redeem himself in a tone for how he helped Donald Trump seven years ago.
Well, don't you feel like Josh?
And that's where I put a note as I read through your story, you know, is impact if he doesn't get the nomination and you get to it? Is it just the point that this is someone who actually is standing up and kind of poking the bear and saying, wait a minute, you did this, you did that? You know, is this what we want for a president? So you know, is that how he redeems himself Ultimately? Then is that going to be useful politically? Will it change the minds of voters?
Well?
I think what he's trying to do there is essentially bait Trump into attacking him. Like, the challenge for all of these candidates is they need to emerge as the main anti Trump alternative. For a while, it looked like that was going to be De Santis, but De Santus is now in a tailspin. So if Christy, you know, his hope was to get on a debate stage with Trump and kind of go mono amano and beat him up and hope that Republicans recognize that Hey, you know,
there's a new sheriff in town. Christy is also this tough guy. Maybe we should switch our allegiance to him. Well, he doesn't have that option now, and Chris Christy can still stand out from the rest of the pack by going after Trump. I think the question is will Republican voters follow him there? And the early polling evidence is that they won't. And I sat down with Christy and asked him about that, and he said, essentially, listen, I know none of you guys in the media and none
of polsters believe that I'm going to beat Trump. But when I do, when I go out there and beat him up in the debates and his own voters see that, they're going to think to themselves. And this is a quote from Chris Christie to me, Okay, he did that to Trump, what in God's name will we do to Joe Biden? And at that point, you know, Christy is hoping that they'll switch their allegiance. That is the theory.
We don't have a lot of evidence yet to suggest that it's going to pan out that way, but I would point out that there's a new Republican poll out and sure enough, Chris Christi has leap frogs Ron Desantas and now stands in second place behind Donald Trump. So still within the realm of possibility. A lot of it is going to depend on how Christy does.
In the debate.
So it could, it could happen. But let's say it doesn't happen, and let's say that former President Trump is once again for a third time Republican nominee Trump. What happens to Chris Christy then? Does he do what so many other never Trumpers did, and and and gather around and say, well, I guess he is the Republican nominee and we'd rather see him as president than Joe Biden.
You know, it's it's it's a great question, and it's one that Christy ducks by saying he doesn't think that that's going to happen, but it's it's gonna It's really tough to go from being anti Trump to pro Trump, to anti Trump to back to pro trup. You know, at some point, you know, you have to put on
a neck brace from all that whiplash. I think what Christy is really hoping for that no matter how things turned out, that he's redeemed himself in the eyes of the political world to an extent, simply by fighting the good fight that the other Republican candidates don't seem to
be willing to and trying to stop Donald Trump. Now, that might not get him an important political job, but look, hey, maybe in four years if the Trump era passes, you know, maybe if the party sours on Trump and nominate somebody else a Ron de Santas, Tim Scott, you know, Christy will come to look like a like a brave guy, like a prophet, and maybe find a role for himself in politics. Is perhaps an attorney general or maybe you know, four years from now, eight years ago, he's only sixty
years old, which is like adolescents in national politics. He could theoretically run for president in a future cycle where the MAGA vote isn't as powerful and still have a chance. So I think the main thing, what is.
This world you describe, Josh, Well, it's on a far off, on a distant plankay.
You know, people have been predicting for years and years that eventually Trump's hold on the Republican Party would break. But look, if he loses the election in twenty twenty four to Joe Biden. I think that's going to go a long way towards severing the party's connection to Trump. And if he wins, he can only serve one term. So there is the light at the end of the tunnel for non Trump Republicans, just in the sense that, like, eventually Trump can't be the president anymore and somebody else
is going to kind of get that role. So I think Christy is also acting with an eye toward what that future might look like. But of course he's banking on the fact that we'll have to look very, very different than our Republican president does. Today.
That was Bloomberg business Week National correspondent Josh Green. You can hear more from him and his outlook for the Republican presidential field on our podcast feed Coming.
Up, we examined the cost of climate change and why it affects way more businesses.
Than you might think.
Economist Claudia sam helps break down the data when we come back. You're listening to Bloomberg business Week. This is Bloomberg.
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Okay, yes, we focused on Jackson Hole and Jay Powell and all the global central bankers in attendance at the Kansas City Fed's annual gathering. We'll talk of fly fishing as well. You can read all about it though on the Bloomberg and also at Bloomberg dot com. And yet, what we keep thinking a lot about is climate change. The impact, the lives lost, the costs, the productivity hits.
Yeah, another week with extreme weather and incredibly distressing headlines. The aftermath of Tropical Storm Hillary pummeling California and other parts of the Western US. Overall, Carroll the nation is on track to experience its worst year for smoke exposure in decades, this after wildfires in Canada sent toxic plumes drifting across the border to the Midwest and the East
Coast earlier this summer. And then, of course there's Maui, where fires have pushed the official death toll into triple digits, with more than a thousand people still unaccounted for.
And just remember climate change, it's a glo global thing. Fires and floods are tragedies. Of course, one of our next gas rights that we also shouldn't discount the economic damage caused by higher temperatures. Claudia sam is the founder of Some Consulting, a former fed economist, She's also the creator of the Psalm Rule of recession indicator, and she writes for Bloomberg Opinion.
Claudia's latest article on the terminal discusses how heat drags on economic productivity. She and Bloomberg Opinion editor and climate columnists Mark Gonglof joined us with more.
There's a human tragedy absolutely thinking about the economic cost. It really brings it to all of us, right, and the way in which high heats, rising temperatures one channel, an important channel to affect the US economy is through reductions in labor productivity. I mean it's a lot hard when it's high heat. It's a lot harder.
To do the work.
And we have twenty percent of occupations in the United States have heat exposure. It's not just agricultural workers, it's also to construction workers. So there's a wide group of people that are affected by the high heat and it shows up in the economy.
Yeah, it's you know, as we talk about the costs, and first and foremost the loss of human life and the devastation obviously front and center. But yeah, we have to start looking at this increasingly. We talk about it a lot. I feel like have for years and years, but man, I feel like we're paying the piper now, We're really getting some real numbers in terms of all this costs. I want to go to you, Mark because as every day there is news stuff that is related
to our climate, vultile weather patterns and so on. When you hear Claudia speak, how I mean this is just going to continue, correct because at this point we can't really slow the train, if you.
Will, well, we could slow the train, but only by making some drastic choices, by making some different choices about how we produce energy. And you know, her great column reminded me. And it's just it's one piece of a thing that I've kind of been going on about for a while now, which is, you know, we talk a lot about the costs of the clean energy transition. You know, we got to it costs a lot of money to upgrade our infrastructure, to put in charging stations, to build
out solar and wind. Although it's much cheaper than book building a coal plant, it did, you know, But still people complain about the costs and the cost will be high. But to me, I think we need to think of them as investments because the costs of not doing that are so great, And I think Claudia, I was just doing some very rough math. Claudia as the economist, I
am not. But you know, if by twenty fifty we could be losing three hundred billion a year from heat related productivity and losses alone in the US economy, and then you get into other economies and then all the other effects that we're seeing, and again you just you just ran through the game of all the climate disasters we're seeing in like the past couple of months. Uh, those are all extremely costly, and they lead to long term health costs too, and that we haven't even begun
to really tally up. And so the cost of not doing anything or much greater than the cost of doing something about this.
Well, Claudia, talk a little bit about that, because you know, and perhaps the idea that you know, when we talk about costs, we don't associate what Mark is talking about, right, We don't associate the cost that you write about. When people talk about costs. They think about how much a
cost to actually do things rather than you know, subtractive costs. Right, how much how much these disasters remove and take away from from productivity from a behavioral perspective, How do we shift the conversation to actually do this in a way that's you know, really productive.
It's hard.
I mean, the one of the things I talk about in the piece is the human costs, the economic costs.
They all.
Our most for lower income workers, communities that have you know, their housing isn't such that it makes it comfortable when the temperature is high, and so you have to you have to recognize we have a problem now.
Right.
You can disagree about how much happens in the future with climate change impacts, how much we can adapt, and yet right now we are losing productivity because we're not dealing with these high temperatures. And frankly, there are only there are very few attempts to even try to you try to locally mitigate some of the effects on workers, and we're not even doing a good job at that.
What's the turning point?
I guess, like I'm going to be really obnoxious, But is it when the gardener doesn't show up because it's so hot and they can't work in this.
You know, what is it that.
Makes mark people maybe pay more attention. We've had conversations, We've start to have more conversations with you about this.
You know, climate.
Change, the volatility not a new thing, but I keep wondering. I always thought, okay, wait, if you can make money off of this, ultimately people will sit up and take notice. What is it that ultimately makes people think more about the impact, the financial impact and do.
The right thing.
I think they are starting human impact? Yeah, well, the human impact is one thing. And there was a study out that suggested that people are more likely to take action when they're angry. So that's one thing. Maybe seeing people, maybe having your home destroyed and seeing people you love fall ill to this stuff will make you angry. But in terms of you know what we can do right now? There is there are things we can do right now
to protect workers. And we are starting to talk about this more because we are seeing workers dying from extreme heat. And OSHA was supposed to. President Biden told OSHA two years ago to set some federal safety standards for workers, and they still haven't done it, And I do they are they They're getting another push right now because this summer has been so extreme, and so we are starting
to think about it, we are starting to talk about it. Unfortunately, though, it is a case where we just we seem to need to be smacked in the face with it to be somewhat optimistic. I think just this one disaster after another that we're seeing that that will be costly. I mean, we're seeing more billion dollar disasters coming than than ever before. FEMA is about to run out of money and we're not even in the height of hurricane season yet, which
is a scary thing. It's got enough money to cover Maui, but what would and it's going to have to spend a bunch more money to cover the flooding in California, and then we still haven't even started a hurricane season really yet. We could hope for a break there, we could hope for an into these disasters, but we've had three or four months of them steadily, and those are the kind of things that might really start to get attention when the money's run out and disasters are piling up.
Right.
Well, we hope we can continue this conversation with you both, because really smart voices and perspectives on this. Mark Gungloff, editor of Bloomberg Opinion on Zoom in New York City at Clodia some founder of some consulting, Bloomberg Opinion columnist on Zoom from DC. You know it reminds me, you know, there's a story on the Bloomberg bond. Investors can't rely on credit ratings to give them a fair assessment of the climate risks they're exposed to and should brace for trouble ahead.
That's according to.
The Institute for Energy Economics and Financial Analysis.
So it's real, folks.
Still head On Bloomberg BusinessWeek, our magazine team spotlights the prescription benefit managers or PBMs that many of us rely on, and explains why they're increasingly accused of driving drug prices higher rather than helping to keep them down.
You know, what the pbm say is that they lower drug prices by getting these They lower net costs by getting these rebates and other discounts from the farmer companies. They aggregate buying power, they aggregate demand, and they can go to the table with pharma and say, you know, give us, give us money back on these drugs. So the question is you know where does that go and who really benefits from it?
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You're listening to the Bloomberg Business Week podcast. Catch us live weekday afternoons from three to six Easter on Bloomberg Radio, the Bloomberg Business App, and YouTube. You can also listen live on Amazon Alexa from our flagship New York station. Just say Alexa play Bloomberg eleven thirty.
PBMs. You know, pharmacy benefit managers. They negotiate cheaper prices for employers and health plans. That's the goal. But as our Bloomberg BusinessWeek team reports, these same entities are also pocketing drug maker's cash, and they're under fire from all directions right now. Blue Shield of California about one week ago set it or replace some services from CVS Health's care Mark PBM with an amalgam of rival offering, and that sent shares of CBS sliding.
An array of officials, from Federal Trade Commission Chair Lena Kahn to Florida Governor Ron de Santis, they want more transparency from these PBMs. A story in the Business section of the new issue of the magazine details how these PBMs actually grab extra money from the very parties they're supposed to be playing hardball against. For more, let's bring in the author of the story, Bloomberg News healthcare reporter John Tazzi, along with the editor of Bloomberg BusinessWeek, Joel Weber.
Well, I just had no idea how lucrative is to get between you and your prescriptions, And it turns out that we're not alone, and how that feels like a big deal, and that even places like the FTC has also shown an interest. John has been on this for a while and kept me abreast of his interest in it, and so I was really glad to see it. But how does this break down, John, Because the very people who are supposed to be keeping our drug prices affordable maybe don't have my best interests at heart.
Yeah, so this has been an issue in go.
You were just you know, like with somebody that we could, you know, take advantage.
I'm sorry, John, This has been an issue in the industry for a long time. People who followed it know about rebates. So basically what happens is you go to the pharmacy, you fill a prescription, your health plan pays the full dollar amount of that prescription, and then after the fact, at some point, the drug manufacturer, the pharma company, sends a rebate for part of the value of the drug to your pharmacy benefit manager, and the pharmacy benefit manager sends part or all of that rebate back to
your health plan. And this is something that has been debated for years how much of the rebate gets passed through. Employers and other people who pay for healthcare have said we need to have one hundred percent of the rebates passed through. There's been this increasing pressure to kind of get all this money coming from the drug makers back to the people who are ultimately paying for the drug.
Okay, so Tim mentioned that there are some new players around, How is this going down within the industry? Like this does seem like you know that there's an opportunity here to you know, maybe take advantage of consumers.
But there are other approaches that you know are out there as options, right.
So, I mean, one thing to know is that there's been a tremendous amount of consolidation in the market over the years. So there are now three main PBMs that control about eighty percent of the market.
I hadn't realized have been around since the sixties. I don't know why I thought it was a newer thing, but forgive me good.
Yeah, And they're also like those businesses are integrated with much larger companies that also own health insurance companies. You know, you have CVS Health, which owns ATNA, United Health, WHI tones Optimarx PBM signal, which tones Express Scripts PBM, So they have their arms in a lot of different businesses that are all related. There is growing competition in the
PBM market. There are a lot of new entrants, a lot of new tech focused companies, companies that say they're you know, making more transparent offerings, but they're very small, and you know what traction they're getting is still you know, still to be seen because those three big players still dominate the market.
Do you need a PBM?
You know, the industry says that employers are not forced to contract for PBM services and they choose to do so anyway, and you know, that's that's their position. I think realistically, you know, there's there's not a clear alternative right now. If you're providing prescription drug coverage. This is sort of the avenue to do it. But with the blue how do it work?
Before they became so dominant in.
The nineteen sixties or before, like I don't.
Know, like they have PBMs always had a role here.
Well, I mean one thing is, you know, the role that prescription drugs play in healthcare has grown own incredibly in that period.
Right.
There are more new drugs, more expensive drugs every year.
You know.
In the nineteen sixties, I don't have it in front of me, but the prescription to spend was you know, much less than it is now. So part of this is like an evolution to you know, new innovation on the pharmacide that's very expensive here in the United States, where you know, we have a free market for healthcare and the drug makers can set their prices as high as they want, and so this is sort of an
industry that's evolved in response to that. But you know, there are there are increasing questions around, you know, how it actually works and whether they are you know, whether they're clients the employers are fully capturing the value of the discounts that they get.
Okay, So FTC has weighted into this and subpoena affiliates of PBMs called group purchasing organizations YEP. I don't usually think of the FTC. And you know, drugs being in the same place. I think usually more like kind of big tech crackdowns. But what is the FTC's interest here?
So the FTC has subpoenaed the PBMs themselves and then these affiliates, the group purchasing organizations as well, you know. I think as a competition regulator they have and particularly under Lena Khan, they have sort of taken a close look at this industry. They're doing what is essentially a study of competition. So it's not you know, it's not an enforcement action. They're kind of gathering information and will
presumably produce a report at some point, you know. But again, there has been a tremendous amount of consolidation in the industry I think, you know, and these are companies that have a lot of influence over what drugs are available. Well.
And I also feel like rebates is a loaded word.
It just says like.
I'm getting a rebate, like something's got to be good about it.
But when I hear rebate, I think to myself, Okay, this is, you know, a way to get you to buy something with the hope of you not actually cashing in this rebate.
Well, the thing about a rebate is by the time you get it, you've already paid for it, right that you're not. It's not an upfront discount, although there are those two. It's you know so, And then what happens to those dollars when they do flow back to the plan. How much goes to the actual patient who paid maybe the full cost of the drug if they have a high deductible.
That's what I wanted to ask you, executives from the three the three big PBMs, this is in your story, so that they pass almost all the rebates they receive from drug makers back to clients. But we don't really know that, do we well?
Or do they They say they do, and in some programs, like in Medicare, there are regulations around requiring them to do that. But the other thing that we've sort of come to learn is that even as they say they're passing back almost all of the rebates or all the rebates in some cases, there's other money they are getting
from drug makers that is not called a rebate. It's called a manufacturer administrative fee, or an inflation protection fee, or a data fee, or you know five or six other different terms that gow.
My celfone trail?
Is this what this is like like all these crazy little fills.
Anyway, it sounds like it well, right, and so I mean one of the questions employers have is, you know, how much money are these companies making from pharma companies? And it's money that is tied to the prescriptions that you know, you and I are filling, right, and so where does that go? And that's sort of the big unanswered question in all of this.
Where does it go?
Where does it go?
Yeah, there is a bipartisan interest in perhaps regulating this space. Is this one of those areas that everyone in DC actually gets along about.
I think there is a lot of agreement. You know, we've seen bipartisan bills both in the House and in
the Senate from several committees. You know, one thing, just the political context here is you know, last year in the Inflation Reduction Act, that took kind of a big swing at pharma because Medicare will be able to negotiate drug prices for the first time, and PBMs are sort of kind of next up in a way that you know, Congress has been looking at this industry pretty closely, and we'll see if there's action on that in this session.
A great story, Our thanks to Bloomberg News healthcare reporter John Tazzi along with the editor of Bloomberg BusinessWeek, Jill Weber. More on this story available on our podcast feed and of course in the magazine out now, online, on newsstands, and of course always on the Bloomberg terminal.
You're listening to Bloomberg Business Week. Up next, there's a major red flag looming over what's expected to be the biggest IPO of twenty twenty three, and it's the flag of the People's Republic of China.
We break down the thirty five hundred word asterisk Kana ARMS prospectus when we come back is Bloomberg.
You're listening to the Bloomberg Business Week podcast. Catch us live weekday afternoons from three to six Eastern Listen on Bloomberg dot com, the iHeartRadio app, and the Bloomberg Business app, or watch us live on YouTube cod Sprinka.
She's writing all about Arms China challenge because in that three hundred and thirty page IPO prospectus, the company ARM spent more than thirty five hundred words explaining the risks it faces in China.
It's a lot. Alex's technology reporter for Bloomberg News.
She joins us on Zoom from LA I have to say, to be quite honest, when we went it crossed and we were all trying to read the filing and make sense of it, it was a little tricky and we all knew we needed some time.
You spent the time to go through it, and what'd you find out?
I did, and the kind of theme we saw at all the sections and these IPO perspectuses are are hefty documents,
you said, three hundred and thirty pages. It's basically the first look for investors to get a real deep dive on this business since SoftBank took it private years ago and China, China, China kept popping up from that headline that Tom ran through a quarter of this business is in China through its partner in that region, Armed China, but also that there are a lot of risks around this China region if we take a step back a
little bit. We've talked a lot about the geopolitical issues with China, particularly with the tech sector and with semiconductors in particular. The current presidential administration, Joe Biden and his team have taken a really kind of adversarial stance on making sure that the Chinese government their military doesn't get really sophisticated semiconductor chips, well armed designs. A lot of those chips, the chips that run servers AI technology, some
of the most sophisticated stuff out there. They have more than two hundred and sixty customers. So for them, as they look at this market, which is a quarter of their business, they are now kind of dealing with these blockades, these export controls, and a lot of those risk factors were built into the risk section that they to at length.
The other thing I would point out, aside from these kind of geopolitical tensions that are causing some of this risks around the China region, they also pointed out that China's economy is slowing. We've seen the numbers come down. We know that the economic engine over there has slowed
a little bit. So on top of that, this really important market that investors are going to have a lot of questions about to get it to what some folks are saying is a lofty valuation, China seems to be the number one thing that jumped out at me.
So china big customer is the Chinese government. Though, is there any investments in this.
Company absolutely, So Armed China is a different business than ARM. ARM is the company that's listing on the US Stock Exchange, that is the one that filed this perspective. Armed China is basically treated as a regular customer. They do have the same ownership. SoftBank does own a significant steak, a forty eight percent steak in Armed China. But ARM warned and its IPO perspectives that this partner in China, they operate separately. They have no control over their business dealings.
I'll also say there's been some drama with this company. This company's been pretty fraud if you're a semiconductor watcher. They had a CEO, Alan Wu, who in twenty twenty was fired for standing up a company that particular that potentially conflicts with the business he was running in Armed China.
He refused to step down. The legal system in China ruled in favor of Armed China, but that kind of drama is still up for appeal, So there could be governance issues at this all important partner that ARM who's filing to go public in the US, has said they
can't do business there without Armed China. So you have this kind of complex situation that when this company goes on its roadshow, when its soft bank backers, or going on its road show in September, as Bloomberg has reported, I can almost guarantee you that investors in the room are going to want to unpack with these details because this is such a hapty chunk their business.
That was Alex Baranka, technology and social media reporter for Bloomberg News.
That wraps up our first hour of the weekend edition of Bloomberg Business Week from Bloomberg Radio. Ahead, in our next hour, we get into the pre IPO world aka venture capital and the latest trends with the former chairman of Goldman Sachs Asset Management, Sheila Patel. She is now vice chair and general partner of the VC firm B Capital.
We're talking trash and the massive environmental impact it has on climate change with the CEO of publicly traded Republic Services.
We're really talking trash.
That was a good interview, and later we'll get into why containing big tech means defending our civil rights and democracy in the process.
Plus we'll actually lighten the mood for you all. Revisit the Ultra exclusive annual event for any gear head we're talking Monterey Carweek.
You're listening to the Bloomberg Business Week podcast. Catch us live weekday afternoons from three to six Easter on Bloomberg Radio, the Bloomberg Business App, and you you can also listen live on Amazon Alexa from our flagship New York station, Jo Say Alexa play Bloomberg eleven thirty Blenny Ahead.
In our second hour of the weekend edition of Bloomberg Business Week, including talking trash while actually talking about the trash business with the president and CEO of one of the giants in waste management, Republic Services, and safe to say, I think this.
Was one of our favorite interviews of the week.
Yeah, who knew talking trash was so fun?
Carol, you had a lot of fun with this.
Yeah, I'm like, I'm going to read a book about trash.
Actually, Well, I know, as we're dividing things up more and more and more, so where does it go?
That's what we talked about.
In the meantime, AI is still all the rage, including when it comes to VC. We catch up on the venture capital translis Shila Ptel, Vice chairm General Partner of b Capital, and then we'll ask a cybersecurity entrepreneur, which megacap tech firms pose the biggest threat to our data privacy?
Dun dun, duh.
Stick around for that one plus what you may have missed it. Monterey car Week first.
Up this hour. It's a dirty job, but somebody's got to do it, Carol.
Average American throws out some four and a half pounds of waste every day, which comes two hundred and sixty eight million tons of waste nationwide each year. Thirty million tons of this waste is food, twenty seven million tons plastic, eighteen million tons is paper and paperboard, not all of which gets recycled.
To him, we're talking trash, garbage, waste, call it whatever you want. We produce a lot of it. It's got a massive environmental impact. It contributes to climate change. It also raises the question, Carol, what do we do with it? And how can we be better about it?
John vander Ark his president CEO of the forty six billion dollar market cap in publicly traded Republic Services based in Phoenix, stock is up about fourteen percent so far this year. Cascade Investments an investment vehicle and holding company for Bill Gates, of course, the co founder of Microsoft is the top shareholder in the company, with about thirty
five percent of the outstanding stock. Listen, it's great to have you here and talk to us about the business, the bulk of which you know, contributes to what moves the balance sheet.
Tell us give us some perspective.
Well, we're actually an interesting we're kind of a backdoor view of the economy because every but he has something they need to dispose of. So we serve small you know, households, We serve small business, we serve large business, we serve national players, governments, so.
We really get it.
We have a very diversified book of business across our you know, almost fifteen billion dollars of revenue, and so that gives us a really good view of the economy. And we're very you know, spread out, and we're resilient obviously, because even in a down economy, everyone is still going to have something they're going to dispose of.
So what's your view on the economy. Since you have such a good view and vantage.
Point, we're still cautiously optimistic right the recession. We keep reading about it and hearing about it, and it's not really showing up in our p and l yet. Now I would say that it.
Doesn't you say, because you're kind of resilient, but how do you pay?
Yeah, you'd see some decline, right, you think about maybe a three to five percent drop in demand, right if an economy is really going to pull back and be in recession. So construction, for examples, portion of our business less than ten percent, but that's down about three percent year over year. So we saw that commercial residential start slow certainly into last year, and we kind of have a six to nine month lag effect on that. So
that's down little bit. But you know, autos down a little bit in the first half, but then you know, the industrial side of the business is just booming.
When do you need to what do you need to see in order to go from cautiously optimistic to optimistic.
Well, listen, when I see housing starts, you know, kind of predicted to be up next year, I think that's you know, we'll probably slow a little bit on construction into the early part of the first half, but then we'll pick up in the second half. And listen, I don't I don't think all of the indices are fully accounting for some of the government spending that's coming in on infrastructure. Spend and we're certainly a beneficiary of that.
So we're seeing that, you know, hit our business and again very very strong.
So when you say the industrial side of your business is strong, give me a little bit more color on that.
Yeah, two sides of Think about a major petrochemical player, right, you have a lot of things they need to dispose of, certainly some recycling, but special waste, haazardous waste, a lot of environmental services in the middle of that that we take advantage of that. Or think about a brownfield remediation, you know, opportunity where you know, we're in the front of the line there, we're doing that dirt clean up there and we're taking all all those materials and bringing those to the right spot.
Which is the bigger part of your business?
Give us an idea.
Is it that side or is it just the regular trash?
Yeah, it's a funny, funny business. It's about if you measure based on our customer account, which is fourteen million, yeah, it's ninety plus percent B two C.
So you think about the.
Homeowner where we actually service. If you measure where dollars change hands, it's more than ninety percent B to B because in most cities. The municipality contracts with us, and we consider that a business transaction.
Talk to me about these contracts, the most competitors that you have in some markets, What does the competitive landscape look like, because you know, every market is completely different. I don't know if you've spent time in New York City, but the trash collection.
Here is pasy, never problem. Never see it on the sidewalks.
See, it's completely wild.
How much of recycling is part of the business.
It's a growing part of the business, kind of fifteen percent and growing. Yeah, and again we see that as a big growth driver. That solid waste is actually shrinking on a per capital basis.
Okay, so is that a good thing?
Is solid waste?
Mean, that's garbage's industry talk for garbage. So garbage is shrinking on a per capita basis and recycling is growing. And listen, that's our plan. We're trying to drive that diversion. And you know, when I started ten years ago, people used to say, well, we make all our money at landfills because that was our highest margin business. And I'm a customer person. I said, landfills don't pass the time customers pass, and so you need to charge and understand
what the product is worth. And that's what we've done. We've taken recycling pricing on the street to probably eighty percent of solid waste five years ago, it's now one hundred and twenty percent.
What does that mean?
And we've grown it faster?
What does that mean?
So, Matt, think about a small business and having two containers that the truck comes up and picks, you know, once a week or twice a week. Five years ago, the price of that recycling service was eighty percent of the price of the garbage service, and now we've flipped it, it's one hundred and twenty percent because we've priced recycling way faster and we've grown recycling faster.
Does it also mean people want to be recycling people?
We know we do the customer insight where people are passionate about recycling and they want to know it goes to the right spot?
Does it though?
In our case, absolutely right. That's part of our environmental responsibility, which is one of our values. And I would say most of the time, yes, there are always corner cases where some smaller operators not doing the right thing on the back end, but most of the time you can have pretty good insurance that if you're putting it in the bin, it's going to get recited.
The issue over the last few years has been there isn't really those countries left to buy our recycling like China used to do. China is not doing it at the same rate that they used to. So where do these where do these plastics go?
Yeah, when China kind of shut their doors, we went from about thirty five percent of our material going abroad to zero in about three months. And so what's happened is those value chains have really gotten repositioned. So there's a lot of domestic manufacturing that's come online, particularly for fiber and paper. So now our supply is almost entirely to memestic.
What about plastic plastics.
Is interesting, So most plastics today, rigid plastics get down cycled. So think of your water bottle, Think of your detergent bottle that goes into a pipe, park bench, or carpet. Now that's good, it's not going to go in the landfill, so it's going to get a second life. But after that, that's.
Going to go in the landfill.
So we're forward integrating into that. So to try to take that water bottle and get it back into food grete quality, and so it can go right back into a water bottle and then we think we can turn that at individual polymer six, seven or eight times before eventually it gets degradatory.
Is it expensive to do that?
Yeah, we're investing about three hundred million dollars to produce four of these centers across the US. The first one opens up in Vegas here in a few months, and we've contracted with Coca Cola, and listen, we could sell out of that center five times over. We had to limit people's buy on the back end because there's such a short supply for this recycled plastic.
So go back to what Tim said, does it really get recycled? Because we have all gotten really good at dividing up our garbage in multiple ways, and the question is does it all really get recycled? Does the paper get recycled, does the plastic get recycled? What guarantee do we all have that it's being done?
How do we know?
Well, listen, not everything that you put in the recycling container is recyclable. Fair, right, So if you put the clamshell you might get at the grocery store that might be made with some recycled plastic, but it's not recyclable.
And so one of the things that we're pushing on is working now back upstream to say, how do we get more things in the original form of pet or hdpe that's the water bottle, yeah, and the detergent bottle of milk jug so that it can get get recycled and keep getting recycled.
I thought there was a little triangle on that. Yeah.
If it has the triangle, yeah, that's made with post consumer content. It doesn't mean that particular thing is recyclable. So there's a huge opportunity for education here because consumers care and they want to do the right thing.
I have to say, stand over my recycle I'm like this, does this really get recycled? If I clean it, is it gonna like go?
You spend a lot of energy doing this.
I actually do.
I do care, empty, clean, and dry. Those are the simple.
Rules, but not everything that has that thing not. Can we work on that messaging?
Can I feel like I've been lied to for thirty years?
You know?
John?
One thing I wanted to ask you is when we were talking about it off air, your company and waste management top players in this industry, both with ties to Wayne Haiseanga. How do you think about and you've been at your company for a decade or so, how do you think about the evolution of kind of how we collect trash.
Where it was, where it's going the evolution.
Sure, yeah, I can just tell it from my tenure we started. You know, when I started, we talked about ourselves as a garbage company, and then it was a waste company, and then it was a waste and recycling company, and then a recycling waste company, and now I environmental services and a sustainability company. And that's not just market that's just not marketing speak. That's actually where we were
investing in the business. And again, I'm trying to challenge every ton that goes into a landfill, because hey, when I put in a landfill, it's a call to me. But if I can recycle it and reuse it and repurpose it, then I get a second benefit, a second stream from that. And so and by the way, landfills aren't being cited right that they're closing up, and so if I can extend the life of my landfill and I can get a second sale of that material. In addition to collecting. That's a win win.
Many thanks to John vander Ark, President and CEO of Republic Services for joining us in our Bloomberg Interactive Brokers Studio. The full conversation is available on our podcast feed Up.
Next, we talk challenges and opportunities in the venture capital space with b Capital Vice Chair Sheila Patel.
You're listening to Bloomberg BusinessWeek. This is Bloomberg.
You're listening to the Bloomberg Business Week Podcast. Catch us live weekday afternoons from three to six Eastern Listen on Bloomberg dot com, the iHeartRadio app, and the Bloomberg Business app, or watch us live on YouTube.
Tim This week, we saw Nvidia deliver a third straight sales forecast that's sur past Wall Street estimates. I mean, as you said at the top eblowout quarter. The chip maker's results fueled by demand for its AI processors.
In Vidia saying sales will be about sixteen billion dollars in the three months that end in October. Analysts had estimated just twelve point five billion. That's according to data compiled by Bloomberg. In Vidia's results last quarter also blew pass projections, and the company approved an additional twenty five billion dollars in stock buybacks and Vidia.
Shares hitting a record following the quarterly update. Now, the tech ferver hasn't quite reached every corner of the investing world. According to data last month from research firm Pitchbook, venture capital funding globally nearly halved in the first six months of twenty twenty three, highlighting a lack of investor interest in less demand and sharply higher interest rates. That's despite huge interest in AI startups sparked by the success in open AI's chat GBT.
The investors port more than forty billion dollars into AI startups in the past six months. That's according to the data, including the ten billion dollar investment by Microsoft and open Ai and one point three billion dollars in funding for rival Inflection AI.
All right, so let's get to it, because back with that to talk about what's going on when it comes to the VC world, and we're delighted to have her back with us. Sheila Patel. She's vice chair general partner of be Capital. She's former chairman of Goldman Saccesset Management. She's with us on Zoom from Park City, Utah. Shella nice to be talking with you again. Last time I think it was at the Milkin Institute Global Conference in May.
How are you and talk to us about your world and how things have changed.
I'm great, Thank you so much, and it's so great to chat with you again. You know, I think the world since Milkin has had some good news, had some rougher news, But overall, I think it's been a fascinating period to see how investor sentiment hasn't necessarily responded to some of the good news we're seeing on the economy and particularly among public companies on profits and so on.
So there's a lot out there to look to. But as you pointed out in opening this, when it comes to venture, there are definitely some challenges and it'll be fun to chat about them with you.
Well, let's talk about the challenges first, and then I want to talk about the opportunities. So it's been chopped waters certainly, given higher interest rates and pull back on funding, and we've seen some venture backed companies wealth cease to exist, cease to operate. It's a different world than it was in twenty twenty and twenty twenty one. What are the challenges that you're seeing at the capital Well.
I think you know, along with the entire VC community, we certainly see challenges as you mentioned, in terms of investor interest, and I think institutional investors data a survey of about forty four LPs show that almost three quarters would allocate less to VC next year. Now, many of them have been strong allocators and supporters, and I think they'll be back, but I think there's definitely concern overvaluations, and that's where sometimes challenging news can end up being
good news. We've been very fortunate in being able to raise our latest fun Growth Fund three and beat our goals with that, and you have seen several VC firms, particularly some of the largest, have some success raising money because of those other themes that you mentioned, the interest in AI, the focus on areas where tech really can be additive in up and down markets, and that in many cases is enterprise and fintech, which are areas in
which the capital operates. So I think there's some high points, but in particular, investors are looking to really make sure that the people they give money too are focused on these questions of valuations, and that's where the data has really been stark, and is the opportunity, maybe the silver lining to the cloud, so to speak, because valuations have come in and it means there are great opportunities to find good tech companies at much more reasonable and appropriate valuation.
Hey, Sheila, is AI actually helping you guys find better opportunities right now and able to go through maybe a lot more deals and figure out what really makes sense? Yeah.
I think applying AI to deal flow and to analysis goes hand in hand with looking at how our companies are using AI. And certainly I would say it's been an amazing partnership talking about AI with our strategic partner BCG. When you look at the work that BCG is put in at all levels of Corporate America and global corporates and thought about how to apply AI to solving some
of the problems they're facing. It has really helped us take it in house and think about ways to apply it in our own investing and our application of analyzing potential portfolio companies.
But I guess what I'm also wondering too, has something fundamentally It's interesting to hear what you say about, you know, investor interest.
When it comes to VC.
Is there something fundamentally structurally going on? We talk a lot about I know, I think we did it milk, you know, the private credit markets and the amount of money that's out there. I mean, is there something structurally fundamentally going on that's changing the VC world or is it like it was, like it's always been.
Yeah, Look, I actually I guess I'll I'll put my longer term hat on it. To me, is the maturation of a segment of investing, just like we've seen other areas go through. There was a moment when index investing was young and new, and some crazy you know, evaluation, some crazy structures, lots of things went on, and now
it's a typical part of people's investment at portfolios. I think when I look at venture and I compare it to the history my twenty years at Goldman, my thirty years in the industry, and watching various areas come into their own, such as quant even hedge funds and private equity. They go through a maturation process, and I think it's a natural evolution to me, you know, I look at venture and maybe it's because I'm one of the old people in venture.
That's how young an.
Industry it is. It's filled with amazing technology experts, but maybe you haven't seen as many market cycles, and at the end of the day, BC has to perform the same as other areas, and that maturation is part of why you see some funds able to cope with the changing environment, the same as you see some portfolio companies coping better with a more difficult funding environment.
So talk to me about two opportunities in two senses of the word. One geographically, where are you deploying money? And then also what types of companies excite you right now?
Sure, well, maybe I'll start with the last first, because I think it ties into that question of AI. I think that we spend so much time and maybe this is a trend in general on the downside of certain technologies or of things in general, that the upsides sometimes get missed. And when I look at AI, I look at the way a can turbo boost drug discovery and research in areas that will be really important in a
climate changing world, like crop protection. So a company like atom Wise, which is one of our portfolio companies, a small molecule expert partnering with the world's leading pharmaceuticals, biotechs agrochemical companies to discover new ways and new treatments, whether drug treatments or whether crop protection, etc. So I think that's an incredible area for focus for AI is drug discovery. Small molecule work can go beyond medications into other applications,
industrial applications. That's amazing to me. And then you know, when I think about that broader question on opportunity, I think that what we have to look to is the longer term prospect for some of these companies. When you have a lower valuation to start with, and that means from an investor perspective, you want to be sure where the challenging valuations, you're challenging companies on the levels they're looking to raise.
That's Sheila Pttel, former chairman of Goldman's Accesset Management, now vice chair and general partner of B Capital, still.
To come on Bloomberg Business Week. What we're giving up as investors keep uping their bets on Silicon Valley's biggest names are privacy.
We're now in a situation where, especially larger tech companies are really just over collecting so much information about us. And you know, in the past, you know, companies like Standard Oil were powerful, but they didn't know everything about us, and that's that was the really when seeing the hacks and seeing all the status slashing around really made me say, uh uh, something's going on here.
Entrepreneur and investor Tom Camp details his playbook for containing big tech while also protecting our civil rights. This is Bloomberg.
You're listening to the Bloomberg Business Week podcast. Catch us live weekday afternoons from three to six Easter on Bloomberg Radio, the Bloomberg Business app, and YouTube. You can also listen live on Amazon Alexa from our flagship New York station, Just say Alexa play Bloomberg eleven thirty.
Well, Carol, I'm reading a book right now. Actually, Jason Kelly, your former co anchor here on Blueberg Business So he recommended it to me. I got it. He recommended it to me a couple of years ago. I'm a little behind it. I bought it that on my kindle. Recently I'm getting around for reading it. It's called The Averet's
by Dave Aggers. It takes place in a not so distant dystopian future where one single, huge tech company pretty much controls everything from social media to e commerce to search.
Wait aren't we Oh no, sorry.
Well that's a good question. Here's the thing. Almost everyone lives under constant surveillance, their cameras everywhere, people broadcast their entire lives. Everybody's on their best behavior lest they be caught on camera saying the wrong thing or not recycling.
Oh my what?
Yeah?
All right, So, given we're technologies today, it's actually not that hard of a future to imagine, and perhaps our next guest is trying to prevent the world from emerging that specific world.
So we've got with us Tom Keapp.
Yeah.
He's the author of a new book containing big Tech How to protect our civil rights, economy, and democracy. He's also co founder of the cybersecurity firm Centrify. It's now called Delinea. It was bought by Toma Bravo back in twenty nineteen and later by TPG. He's volunteered on the Biden Harris Tech Policy Team. He did that in twenty twenty. He worked with advocacy groups for years on legislation around consumer privacy and data protection. He joins us on Zoom
from Menlo Park, California. I want to know at the specific moment that you realized that you thought that big tech needed to be contained.
Well, my last company was Centrify, and it's cybersecurity, and we saw all these hacks coming in and it really became clear that when a couple couple of these companies got breached, just the incredible amounts of data that was being accessed by the bad guys. It really got me to appreciate that we're now in a situation where especially little, larger tech companies are really just over collecting so much
information about us. And you know, in the past, you know, companies like Standard Oil were powerful, but they didn't know everything about us, and that's that was the Really when seeing the hacks and seeing all this data slashing around really made me say, uh uh, something's going on here.
All right, Tom, I'm going to put it out there. I'm going for a headline here.
But is it like climate change or maybe like climate change, that we might just be too late, that this train has definitely left the station.
You know, I think we actually because it's bits and bytes versus the sky and clouds and the earth rotating and trees and all that stuff, I think we can actually control it. I Mean, the fundamental issue is in the US, we don't have a federal privacy law, right, we don't have rights over our data the right to know what's being collected about us, the right to say no and say please don't sell or share my data,
or the right to correct or right to delete. So I do think that we could really make some significant strides and be able to govern our information. And if we don't, frankly, it is going to get worse with AI because then all of a sudden, our data, and a lot of it's our personal data, kind of becomes part of this big blender of AI utilizing our data to create other things as well. And we worry about copyrights, right, so what about our data?
Well, what about do we follow the lead of what's going on in Europe? And I think about the GDPR, right, the General Data Partition Regulation that's out there that really does push for privacy protections and security of personal data. Is that what we need here in the United States specifically? Is that what you're kind of pushing for.
Well, actually we've done it here in California. So I mean you're referring to Europe's privacy law and people call it the Brussels effect, but California we've historically had the California Effect. It first started with auto emissions and consumer
protection around car safety, et cetera. And then California in nineteen seventy two actually put privacy as an inalienable right into our constitution, and from a privacy and cybersecurity perspective, we were the first state to actually pass a data breach notification law right and we are and have been
the first state with the most comprehensive privacy law. So I think California actually has a better model where it's able to balance innovation with the tech players, but also give consumers some basic rights over their data and how it's used.
Tom, you're also a seed investor in many startups right now. They include companies with names like Sakoovi, Privacy Code, Trusted Twin, Ivy Technology, share Id, Sunday Security, Surf Security, Holistic AI. The list goes on the cynic and perhaps somebody would say, well, wait a second, this guy's has this agenda because he's invested in a lot of companies that want to take on the big guys. He's invested in a lot of companies that would benefit from company from having stricter data
protection laws here in the US. What would you say to that.
Well, I'm back, maybe this is a bad analogy, but al Gore. You mentioned climate change. You know, he was talking about climate change for years and then you know he was having difficulties trying to get things past for from a policy perspective, but so he wanted to have change done. So he started joining boards and he's on the board of Apple, but he's also involved in climate funds.
So everything that I've been talking about as it relates to privacy in the book is things that are written years ago, well before I actually started doing any investing, and so I'm trying to put my time and effort into making changes. And what I'm doing with my investments is actually trying to empower consumers to better secure them
and protect themselves. So my investments tend to be more consumer centric and trying to help stop identity theft or help people get better control over their privacy as well. But I've been completely consistent. I have a blog that's been out there for years. I've talked about these things. I was a full time volunteer on Proposition twenty four in California, and it wasn't only to just relatively recently
that I've been complimenting and supplementing this. But I've been completely consistent in my advocacy of better cybersecurity, better privacy for you, me and other people as well. And so yeah, that's I mean, people can say that, you know, but the record shows that I've consistently been talking about this and proposing this for years.
Well, and on what you said, if we go along with what you kind of said in akin to what we saw with al Gore, he was right in terms of the concerns about climate change. And so if we had all paid a lot more attention, maybe we wouldn't be kind of in the world we are today.
If you are right about.
Your concerns and we ignore them in terms of cybersecurity, where could that what's the dark scenario, the dystopian scenario of all of this data accumulate, accumulation on all of us in the hands of a few big tech companies.
Well, you know, look, historically the large tech companies their business models was advertising. And for us, we made that trade off to say, Okay, I'm going to give you all this data, you're gonna give me these free services. And then what happened was that, you know, we started shopping for a red dress or red basketball shoes, and then all of a sudden, for the next seven weeks, every web page had that red dress or those red basketball shoes. It was creepy.
Try being a journalist and like researching a company that we're gonna have on a guest that does something like men's underwear and then we're getting it.
Sorry anyway, go ahead.
That is it's creepy. But the problem is is that we are now in a post abortion rights America where stuff that we did before is actually illegal in some states, or there's data like you know, there's all these issues about trans and so the information and that type of data is now actually can be used against people because before it was off to advertisers, but it could be offered to people to harass or discriminate against people as well.
And so but even if you just step even further back, I mean, the reality is is that this data is being collected about us as adults. And yeah, maybe we can navigate around some of the rabbit holes or not disregard these ads, but what about our kids. There's no differentiation if our kids are on the keyboard versus us
on the keyboard, and I think that's fundamentally unhealthy. So yes, I think that the actors have figured out how to start weaponizing this data that historically has been used for advertising.
A big thanks to Tom Camp. He's the author of a new book containing big Tech How to Protect our civil rights, economy, and democracy. And check out our podcast feed for more on AI in the corporate world and how Tom Camp says those megacap tech companies, specifically Alphabet and Meta are collecting information that could compromise their users down the road.
Speaking of the road, you're listening to Bloomberg Business Week coming up spending thirty million bucks without really trying.
We go behind the wheel with our own auto guru, Hannah Elliott at Monterey Carweek. This is Bloomberg.
If you're listening to the Bloomberg Business Week podcast, catch us live weekday afternoons from three to six Eastern Listen on Bloomberg dot com, the iHeartRadio app, and the Bloomberg Business app, or watch us live on YouTube.
Speaking about money, if you happen to have a spare at thirty million dollars lying around, there are a few things you could do.
I could take a lot of.
Really nice vacations, a lot of really nice vacation be a lifetime of nice vacations. You could buy some pretty great second, third, and fourth homes. Maybe fill up the five twenty nine for your kids. Sounds like Tim roate this, Yep, I did, and grandkids so they won't have to worry about paying for college. I mean, there's a lot you could do with thirty million dollars.
Or or you could buy just one single Rolls Royce Droptael after all, only four of them will be made. And I use this thirty million dollar price tag. I use that really loosely. Yeah, because we don't actually know how much it's going to cost. But it costs, you know, it's like twenty eight million was one a few years ago. Thirty million, it's like how much it costs to make. So it's going to be around that area, you know, Carol, if you have to ask, you can't afford it.
Oh, I sound like my mother. All right, So let's get to it.
Hannah Elliott's with US autocolumnist for Bloomberg Pursuits. She was at the Monterey Car Week.
She was there.
She writes not just about Rolls Royce's latest in it's coach built series, but also the electric hypercars and hydrogen SUVs that she saw. She's on zoom in La. Let's get to it, Hannah. First of all, this is the car show I feel like to go to tell us about it.
Hi, guys.
Yeah, I have to say Monterey Car Week is definitely the new car show. When I say new, I mean it has taken the place of like the Detroit Auto Show or the New York Auto Show in terms of important sport new car debuts. Like that thirty million dollar Rolls Royce that you described. It's the place to be both for industry and for enthusiasts and collectors. I have
to say. And yet, that droptail is incredible. I think you know, it's well over thirty million according to my source at Rolls Royce, who didn't want to specify, but said, you know, it's definitely more than thirty and kind of a car designed from scratch. Basically that's what thirty million gets. Ye, thirty million plus.
Can you talk about it?
It is gorgeous And of course you know we're on YouTube and Bloomberg Originals, so we'll show some pictures for those folks, but for those on radio, I mean, just tell us about it.
Yeah.
So this is part of Rolls Royce's Coach Built series This is the third vehicle in this series. It started with the Sweptail in twenty seventeen and then the boat Tail in twenty twenty one. You might remember those. This Droptail is the third and what Coach Built means is Rolls Royce selects some of their most enthusiastic buyers and collectors and says to them, basically, we will design whatever
car you want. Now they're going to They use the same V twelve engine that is found in the Rolls Royce Ghost, but aside from that, it's kind of whatever the client wants. The car is mostly shown as a roadster, but it does come with the hard top made out of carbon fiber. So it's a lot of car.
Tell us about one more car that you saw.
Okay, this is the other end of the spectrum and you're going to be surprised. But I want to talk about the Ford Mustang GTP. This was kind of a choker because Ford isn't always at Monterey, but they brought eight hundred power V eight Mustang that costs over three hundred thousand dollars, which is a lot for Mustang. It's
getting a lot of buzz. Of course, Mustang is you know the original American pony car, so there's a lot of enthusiasm behind it, and Musting is Ford has said, we're going straight after Porsch with this car, so we'll see if they can pull it off.
That was Bloomberg Pursuit's Auto column. This Hannah Elliott and for the classic car lovers, do not worry. There were some old school cars driving around in Monterey last weekend, Hannah telling us about a nineteen sixty four Ferrari. It's sold at auction for a cool thirty million bucks. So Carol a little something for everyone, as long as everyone brings big bags of money.
Buckets, buckets and buckets.
Hey.
Check out her story online to some great pictures and the full rundown of some of the highlights that she saw while there. That wraps up the weekend edition of Bloomberg Business Week from Bloomberg Radio. Thank you so much for joining us.
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Find our Bloomberg BusinessWeek podcast at Bloomberg dot com, Apple, or wherever you get your podcasts. The latest edition of the magazine is available on newsstands now, at Bloomberg dot com and always on the Bloomberg terminal. I'm Tim Stenebeck.
Did you buy the thirty million dollars?
I did not, just check it.
I'm Carol Massler. Have a good and safe weekend. Everyone. Stay with us.
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