Bloomberg Businessweek Weekend - February 1st, 2020

were in Miami this week. We're gonna bring you next week a lot of the conversations that we had down there, But this week we had a little bit of a preview from the CEO and chairman of hard Rock International. It's their stadium that the big Game is being played in, and we stayed with sports. We've got a great story from Arah Boudway about Joe Sigh. He is the majority owner of the Brooklyn Nets. Only last year became that

and it happened. Jason, of course, talk about timing just before a controversy that would threaten the NBA's relationship with its most important overseas market. We're talking about China well, and we talk about China and the NBA also with Chris Paul All, He's an NBA star also the president of the Players Association, so he has some thoughts on that as well as building out his own business. Speaking of presidents, there's a lot of mansions down in Palm

Beach just near the president's private club. We're talking about Moral Lago and for some reason they're not selling. And speaking of mar Lago, we know a lot of business gets done. They're including about trade. We're going to bring you another angle on the US trade war with China. Phase one of the US China trade deal. It is done, Jason.

We know that tower still exists on some Chinese good and despite the on again offic intentions between the two countries, a move last year by the US actually gave Chinese solar panels a bit of a gift. It did, and this is one of these unexpected benefits or detriments, depending on your side of the equation to these trade negotiations. Bryan peck House is here with us. He's going to

tell us all about it. So this is a booming business. Obviously, we talk a lot about alternative energy, and yet I'm not sure any but he knew this was really the forefront or a flash point in the trade wars. Yeah. Absolutely. One of the first tariffs that Trump imposed was on solar panels. It was two years ago this month, and it definitely rejiggered the entire industry, and they run up

to him making the decision. The market slowed down considerably because we knew he was gonna imposed tariffs, but how big, how long, and so it really slowed down the development solar farms in the desert, on rooftops, but more than the big products in the desert went around the country, and then he imposed these tariffs and people were like, wait a minute, like we didn't do anything to deserve

this fight between US and China. But going back a little bit further, Uh, the US makes very very few panels. It relies very heavily on Asia. Chinese companies are the big makers. Are these products products not also from China, from China, but also from Malaysia, from Thailand, from Vietnam, And so it's been a years long sort fight between the countries on this. It predated Trump, but then he

put his imprint on it two years ago. Well that's I think some history is important here in terms of the U s trying to develop, right, it's solar industry Brian and then you know allegations or realities of the Chinese undercutting in terms of pricing and really kind of owning this market. Yeah. Absolutely. I mean China has dominated this market because they have the cheapest panels out there for many cases, the cheapest panels, and it's hard to compete with that. It's more expensive in the US to

develop it and to buy it in the US. So if you're you know, solar farm developer, and you're you're competing against wind, natural gas, fire power plants, you know, if you're trying to go and you know inspire boom of solar, you're gonna go probably the cheapest form of solar cost provider. Right. That means China, that means Asia, and they've come to dominate the market. And by the Tom Trump came into impose these tariffs, there was so little manufacturing of solar panels in this country. A lot

of people have to depend on Asia for it. And so take us to this moment. Air folks from the industry, they start literally like calling their member of Congress, They start lobbying, they start doing all the things that an industry does to try and get some action. They win. They think and then they start to realize, wait a second, this wasn't exactly what we thought we were going to get. Yeah, exactly.

So when he Trump and posted harffs two years ago, it was on the entire industry and developers and big farms were like, wait a minute, Like a lot of the US manufacturers focused greatly on rooftops, and we do these farms in the desert elsewhere in the country, and these panels are much bigger ones that they use. They're much heavier. You can have one person I couldn't do it, but one person bringing up the solar panel into a roof the once goes in the desert, you need two

people will do it very very heavy. You're talking about American utilities, right, really needed access to these really really big panels. Well, yeah, they're gonna buy the solar power, yes they do, but it's it's developers these projects that do it on behalf or for these utilities in that case. Um So when this happened, like they these the industry, develops, these big farms said wait a minute, like this is attacking us. I think you have the wrong sort of

culprit here. So they tried to go get an exemption, and they said, you should exempt all solar farms in this country. They got a no go on that. So I thought, how can we go in sort of craft and exemption to this policy that would help us but not hurt the overall policy. So they requested it's very, very complicated. So they requested an exemption on a certain kind of solar panel for big farms in the desert, not rooftop, a certain size, a certain amount of general

electricity generated. And they fall for more than a year for this, and then Juno last year, out of nowhere, the administration says, wait a minute, will give us to you. But they gave a blanket exemption to all two sided solar panels that and which basically newter or like new. The gated a lot of the strength of the efficacy all the actual tariff, So get a little wonky. So it's supposed to be very narrow. Now, No, no, this is important I think, because right, this is what it's

all about. But it was the biggest versions. I think they're called by facials, right, these two sided panels, so that's what they wanted, right, and which are used by utilities and others. And yet it became a much broader plan. Yeah, so you can do my facial on small ending. But like they wanted the exemption for larglarges, large and facial, and the exemption was for everything and doing so you could even use the two sided panels on the roof.

You could do so theoretically, so you can then buy solar panels for any but you know, two sided for anything, and then to get around the tariffs. And that's Brian Eck how's chatting about the business of solar some of those unintended consequences. This is a smart story. Well, unintended consequences. Jason is so right on the money because I think we talk about trade, we use it in these broad macro terms, but it's complicated and there are a lot

of moving parts. And when you go and strive for something, you think X, y Z is going to get done and then something completely outs gets done. You said something in motion, and you're not sure what the ramifications are going to be. The latest issue includes a strategy section, Jason, and it's all about kind of advice for people who are working maybe alone and groups don't have such a lovely part like we do every day to bounce things off of can you imagine we had to skype each

other at the time. That's what folks are doing. They are doing that. Let's bring in someone who was involved in the section demitris um demitro. Good to have you here. So many people are working on their own and they need a little support. Yeah, I mean, we've got so many freelancers out there, right, or people working remotely. Maybe

they work for a company, but they're far away. Um, And so they're handful startups that are catering to to you know, you might even be a PhD student writing your dissertation and you're a bit of a procrastinator, you know. I know you guys don't know too much about procrastination. I mean, because it's also like but um, so we write about these companies. They're kind of like these online work clubs and you log on and you find a work buddy and you can either go the focus mate route.

That's one of the companies we write about, which is like fifty minute increments, quick quick quick, or you can really commit to like three point five hour work sessions with an online buddy so to beat you tell us how it works. I mean, this is literally like you and I would log in from our home offices like hang out. It's it's pretty simple and straightforward. I mean, basically,

that's it. There's an idea behind it that a strong motivator is simply the presence of somebody else observing you while you're working or kind of aware of whether you're working or not. You know, if you're logged on and I'm your buddy on the other side of your computer screen, you know, if you decide to just walk away or stop working on that one, you know, memo, You've got a knock off in the next hour, I'll know it,

and you know that I'll know it. So maybe you won't get up and walk away from your computer in that next hour and you'll actually get it. And maybe even just like showing up to your desk at eight am exactly because that other person is going to be there waiting for you doesn't work. I mean, you know, for the people that our reporter talked to it, they

said that it really worked like beautifully. One guy that she interviewed who works remotely, has a has a part time permanent job but is remote and also runs his own business. This thing really regimented him. He logs on at eight am. You know, he gets a lot done. He's far more productive, and he ends in the afternoon earlier so that he can then, like you know, get to other tasks connected to the running of his business. Too expensive a month, It depends Focus, Yeah, it depends.

I mean there are different price points for the two, you know, so UM cave d is a is a different format and that you can do it in person. They have spaces in Los Angeles and New York where you can actually show up, but there's is also one where you can log on and they're much more bigger commitment, more hours, more intense, maybe projects that you need people to help you sort of you know again find that motivation. So it sounds it sounds kind of like, wait, is

this all it really takes? But in a way, it is all it really takes. I think we're going to see whether how much these work. They're very new outfits, UM a couple of Focus made His definitely attracted some funding that they shared with us um a million dollars so far, and cave Day has not revealed how much they've brought in. But I think that we're at the stage where we're going to start to see more interested

in companies and outfits like that. And you guys do a nice job sort of putting this on a continuum, right in this sense of like we had offices, then we kind of dispersed in many ways, right like hacker spaces. Then we moved to the shared work spaces, right, and that gave rise to we work, and we see what that led to. Now there are a lot of these clubs. Clubs now like the Wing, and there are similar ones where you know you're maybe going to bring together a

group of like minded people. The Wing is geared towards women. It does more than just bring you together to work. It does events and talks and so this is just another sort of evolution in this. We've got so many people out there working on their own who, whether they need support or ideas or people to brainstorm with or whatever it is, you know, can tap into these various resource We'll talk about these peer support groups because that's the other kind of layer that you guys get into.

It's people who are stressed out, and you really get into kind of how you're feeling, how you're dealing with situations exactly, isn't your peers And there are there are companies and groups that are getting together seems to be happening a lot more in Silicon Valley in San Francisco. UM, and these are targeting a higher level executive I would say, so far. You know, there's sort of UM, the Next Generation Young President's Organization, Young Presidents Organization you might have

heard of. It has been around for many, many, many decades, and in the last five or so years, maybe ten years, has really been trying to kind of become a little bit more current and deal with the digital age. But there are startups now in Silicon Valley and in San Francisco that are all about bringing you know, very under intense pressure, you know, founders of companies, CEO s UM

together to really be among peers. So that's why I think, you know, it's attracting that level and to try as best they can to actually open themselves up and unload and talk about how they're really doing, how they're feeling, where they think the pressures are coming from. UM. There's so much that that I think really prevents people in those positions from doing that, sometimes time being a big factor, right, UM.

And so these are organized as like dinners or in ways that also feel like maybe they're doing something else in addition to going and being among a group of peers and sharing their feelings. And one of the things you point out in that story is essentially that they're set up in such a way that if you're at it and you feel like you're just sort of networking,

you're kind of doing it wrong, right. I mean, this is meant to establish relationships, maybe at a deeper level, and you give a nice anecdote about people, essentially saying how are you doing? No, really, how are you doing? You know, and this idea of you know, actually getting to know people. My favorite part I have to say of this section h is the humility quiz. And so you're gonna have to go back and listen to our daily radio show to see Carol and Me take it.

But it has uh some pretty useful questions. Did you take it? Um? I took it. I'm not going to reveal, you know, how humble or not I am, but people should take a look at that humility is, you know,

kind of a buzzy thing right now. I mean, there is real research, academic research research by groups um like Hogan, which we got this quiz from, that does personality assessments, that suggests that humility and being humble is a great quality for a leader, that these are people who don't want the spotlight and who are willing to give credit where credit is due. UM. I don't know how much of that we really have out there. You know, we have evolutions of the types of leaders we've wanted as

the heads of our companies. Right if you think back to the seventies and the eighties and the types of CEOs that we had, and charisma and brash and really things that maybe shareholders or maybe more encouraged by UM, but that led to maybe a lot of promises that couldn't capped and risks. So now it's going the other way and it's saying you can be humble. That's Demitra

Cassands and that's our strategy section this week. And I think it's so pertinent right now because Jason, more and more people are working at home on their own and they're getting a little lonely. So there are companies and apps to help you deal with that well and maybe a little less productive, and so they need someone to keep them on as someone literally on the other end of the basically like to you exactly get back to work.

He became the majority owner of the Brooklyn Nets only last year, just before controversy that would threaten the NBA's relationship with its most important overseas market, China. Jason, We've talked so much about this, We've talked a lot about him, and he's only becoming more prominent. Previously prominent in the world of business, now very prominent in the world of sports. We're talking about Joe Sigh and we're talking with Ira

Budway here in New York City. Phenomenal profile, incredibly timely. Take us back to October when this guy has to come out really for his first public statement as the majority owner of a major team amid a controversy, right, and it starts with, as people probably remember, the Darryl Morey tweet, the general manager of the Houston Rockets tweeting

solidarity with the protesters in Hong Kong, deleting it. But the whole thing gets going, and Joe told me he was in his apartment in Hong Kong, uh and he gets a call from the NBA and they say, you know, this is an issue. There's already a lot of reaction on social media and the mainland China, like we're we're monitoring it, but this could be a thing. And he's in a great position right here. You think about someone who understands China. Great is relative great, It's been a

very interesting position. What was he thinking at the time, And basically like, i am I have to say something. I you know, I'm Chinese, born in Taiwan, do business, live in Hong Kong, mid the protests. You know, own an NBA team, newest NBA owner, big market, do business in China. You know, I'm I'm And he's flying to Shanghai in a couple of days because the Nets are playing the Lakers there. So he basically felt like he

had to come out and say something. And so he says something, and as with just about everything in this case, not everyone's happy with it, but what was ultimately the reaction and what was the effect on him and the team.

So he comes out with this letter that he posted on Facebook that says, basically, everyone needs to understand how Chinese people are going to feel about this, and he basically sort of spoke for all of them, or it said he was speaking for all of them and said, you know, this is really a third rail issue there, we're talking about territorial integrity. And he couched the Hong Kong protests as a separatist movement, and that was the

sort of controversial thing. That's the framing the Chinese government uses, not always the framing the protesters used. But he wanted to say, look, this is why this is so sensitive and delicate, and you've got to be careful. Um. And he says, basically, he got a lot of people saying, thanks, I didn't know this context. There were a lot of people were saying, look, you're just parenting the Chinese Party state line here um. And he, you know, he stuck

by it. When I talked to him, he said, look, I really think it what it is a severatist moment if you look carefully, and so you know, and and it's unclear, you know, there are people who suggest, well, look he has to say that he can't alienate. He has a lot to lose, exactly. And so I put that to him and he said, no, I spoke my mind. That letters what I what I believe. And so remind us why he is as candidly, as powerful and rich

as he is. This is a guy who came to this country, went to Yale, scraps his way onto the lacrosse team, I think, and then meet the guy named Jack Mob. I mean, it's an unbelievable story, a really remarkable story, and there's really you know, and talking to a lot of people. He knows a lot of people in very powerful people in the world, and they say there's really nobody like him in terms of that position

that he occupies. So yeah, he born in Taiwan, comes to the US at age thirteen, goes to a prep school in New Jersey, you know, elite institution, and uh there he starts really quickly assimilating, learns English, loves play sports, plays lacrosse, plays football, goes to Yale, gets on the lacrosse team there. Uh, makes a ton of friends that way. Goes to law school at Yale, where his father had gone was the first Taiwan He's graduate from Yale Law

and then works his way along. He's at a shop called Investor a B looking for private equity deals in Asia based out of Hong Kong. Somebody says, hey, you should look up this guy, Jack Mab. This is right after that they basically started Ali Bab. But he goes to meet him and says, I want to throw in my lot with this guy. And the rest you know its history, but he became the sort of the bridge to the US and the West for Ali Bab well.

And in many ways that's a really important point to emphasize, because Jack mas this larger than life character, you know, so sort of out there being in a lot of ways, Joe seems to be the guy who goes into the boardrooms, talks to the private equity guys, to venture capitalist, to Wall Street, to anybody. He really smoothed the way in many ways for what Ali Baba becomes, right, And that's what Jack Mots told me when I talked to him

about it. He said, you know this, there were times where I'd be in a room with a bunch of finance types and Jack calls himself street guy in the US, and I make them all upset with something I said, and then Joe would smooth it over um. And that that was he relied on him to translate personally the annual letters that he would write to shareholders in the world.

Joe was the one who took Jack's vision and said, this is what I know what you mean, and I'm going to make sure everyone outside knows what you mean too. And that's Ira boot Away. He's got a couple stories in the magazine this week, once about gambling. This one is about a guy who made a pretty good bet

on buying an NBA team. Yeah, he did make a good bet, but talk about his timing because he became the majority owner, as we heard from Ira just before that controversy that really um put to test the NBA's relationship with China. This is a huge market for them, an important market. It is in many ways the future. And Josiah sitting at this great intersection of kind of understanding East and West, well exactly. We often say someone

is uniquely positioned. He really is uniquely positioned in this case, with some two D venues including cafes, hotels, casinos, live music and the rock Shop, and within seventies six countries, Hard Rock International is also Jason going to be on

everyone's radar for the Big game. First, of course, because the Super Bowl is gonna be played in hard rock Stadium, right, and there's gonna be a big ad and it's gonna be one I predict that we're gonna be talking about in part because one of the Stars is j Lo. She's also performing at the Big Game. Jim Allen is here with us, back with us, I should say, great to see you. A big week obviously for the whole enterprise in a lot of ways. Tell us what this

means for the company. Oh amazingly excited about obviously Super Bowl Week and having a commercial you know, as part of the halftime festivities for a Super Bowl the hundred year anniversary of the NFL at hard Rock Stadium. So tell us about why. I mean, you guys have not done right and add at the Super Bowl, So why

why is now the right time? You know? It all kind of came together with the opening of the world's first guitar shaped hotel, the hundred year anniversary of the NFL Hard Rock Stadium, and it just seemed like, if we're going to be involved, you know, let's get involved on a big time basis. But Jamal and tell us about the Super Bowl audience. What is it about that audience that you know, man, this is a place you

want to run an ad. The most watched event in the world, over a hundred million people see this particular event that's just on the TV broadcast itself. When you look at them online. It certainly creates a lot more media impressions, you know, for a global basis for the hard rock brand, and that's something we're very excited about.

So tell us what you can about the ad. Obviously want to leave some for this, everything you can about the ad because because of that audience people, as you know, and I know we know some of them, there are people who tune in just for the ads. They don't even care about the game. So the stakes are high, as they in your business. Well, we didn't want it just to be a spot about the brand, so we

kind of created this storyline. Obviously, hiring a director and producer like Michael Bay speaks for itself that we're committed here long term. So the spot is almost like a mini story that then eventually takes you to our websites, our relationship with j Low and frankly creates, you know, the introduction to the two million dollar sweepstakes, which will be announcing. So Michael Bay, so is it going to have like an Armageddon Transformers kind of feel? We'll have

a Hollywood feel, I promise you that. Did you guys really spend about five point six million to make this commercial. Well, give us an idea. Well, I could say we're north of ten million all in. Wow, was that a hard check to write? Well, frankly, the spots themselves, you know, are approaching that, and you know, Kennily were well north of ten million all in. And so Michael Bay tell us how he gets the nod? He lives in Miami,

I think, and so he's got some connections here. Well, I think we wanted to create something that special, right, and not just because of all the amazing movies that he's directed, but also did a lot of music videos, so he certainly understands the brand. Certainly being in Miami made it a little bit easier as far as proximity, you know, to the guitar shaped hotel. But franularly, we did look at some other candidates and he by far was the one we were hoping for and when he

said yes, we were certainly very excited. Yeah, it's really cool to have him and I can't imagine how which fun it was to work with him. What is this a bet on um, Jim? Is it a bet on the hotel business? Is it on online gaming, which you guys have been moving certainly aggressively into what what is it about for you? What do you hope to get out of it? Well? I think the hard Rock brand, um, we know that, you know, coming up on our fifty year anniversary, is one of the most recognized brands in

the world. But we want to continue to position as a brand of entertainment. And obviously the Super Bowl is much more than a football game. It's about entertainment when you think about people coming together in houses and all the different things they do. So being part of this was something that was very important for me to position hard Rock is not just a brand of hospitality but

a brand of entertainment. But what do you hope that in terms of people say, oh, hard Walk, I didn't know that they I forgot that they're doing this, or they're doing this. Well, we are certainly hopeful that will drive some foot traffic to all the locations on a global basis. But you know, I don't think it's about

quote unquote internet gambling. I think it's more about the brand itself, which obviously has many different sectors that we're looking for additional foot traffic to come to our facilities, both in person and then certainly online through through the online retail, we're Internet gaming, etcetera. All right, so speaking of foot traffic and eyeballs, a lot of people are gonna be walking in and watching a game that's held

in the stadium that you named. You paid, I believe fifty million dollars for the for the naming rights, no small chunk of change. What was the obviously this is going back a little bit, but what was the thinking behind putting your name on that particular stadium? You know, we have been approached about this many times, and um, we looked at it and we said no, probably not for us, because we were concerned in different cities you're talking about, well, frankly in many cities, but specifically in

al Florida. Um. And once we understood that Mr Ross, Steve Ross, who's the owner of the Miami Dolphins and the actual physical structure itself, was committed to really create something that was more than just a football stadium. That piqued my interest. And you know, Steve would say that it was rather interesting, you know, back and forth between him and myself, but we were really excited when we saw he wanted to do things other than just football.

So whether it's the rolling Stones, you know, with their last show there Beyonce, A jay Z, you too, Formula One, you know, the Miami Open moving you know obviously from Biscayne nowt to hard Rock Stadium. It's really an entertainment destination. And once we were convinced that was going to be part of the script, not just the football, very very excited. So tell us a little bit about that back and forth if you can. We know Steven Ross, well, he's

tough businessman. You're a tough businessman. So what were you really sort of haggling over at the end of the day. I don't know if it was haggling, but I think it was more about making sure that we understood what the entertainment commitment was going to be obviously then tying that back to the actual dollars so shade it with the sponsorship, and the most importantly, we did not want to do this on a short term basis. We were

in and we were all in um or. We didn't want to end up in a situation where we've got a five year sponsorship and then hypothetically the name changes a guy. So you know, people are going to know hard Rock Stadium for the next you know, well, actually, We're already three years into the deal for the next seventeen years, and that was very important to us. So what does it mean for the future stadium? I do feel like there's more challenges for people time, new fans,

younger fans, They want a different type of experience. So what does it mean for you guys in terms of what you'll be doing with that stadium going forward? Twenty years commitment, that's a long time, So what's the future. But you know, I think like in any physical building, you know, there's always a conversation about reinvesting in Capex and if we look at Steve's incredible success, you know,

look at the Hudson Yards here. I mean, obviously he and his companies have a long track record at continuing to reinvest to create a world class product. So frankly, that was something that was very important to me um which we believe that the same will continue at hard Rock Stadium as we move forward. Even if you look at what's happened since we actually signed the deal, we

certainly knew that Super Bowls were a strong possibility. Nothing is guaranteed because obviously the NFL has to approve that, but it was very clear in the contract which the NFL was aware of, that if a Super Bowl occurs, then certain financial and economic things may or may not happen. With the relationship between Mr Ross and ourselves, we believe the same will happen as we continue to, you know, grow the partnership on a long term basis. And do

you have any sense of how many super Bowls? I mean, obviously they don't go too far out, but I mean you could get multiple in uh, in that period of time. Well, first of all, there's been more Super Bowls in South Florida than anywhere else in the United States. UM, it's just such the it's such an ideal place for the Super Bowl because obviously Miami is an international gateway city, tremendous amount of hotel rooms. You don't have to bring in cruise ships to try to put people for a

place to stay. UM, the Guitar Hotel, all the amenities that we offer at at hard Rock. We just think it's a natural. So we're very hopeful that many more will come in the future. So what about some of the other proper reason I'm thinking about Atlantic City. I've spent some time down there talking to UM, your team and other folks. Um, you were pretty critical about what's going on in Atlantic City recently in terms of the city itself, the safety. Um, first of all, tell us

how the property is doing. Property is doing very well. You know, first year of first full year of operation actually rose to number two in the marketplace in gross gaming revenue. So that's something that we were very proud of. When you look at the amazing brands like Harrison Caesar's Tropicanical Nugget that have been there. You know, She's been there for over fourty years, so um, huge database. You know, to go up and compete against that in the first

year to get to number two is very important. Jim, Is it a different type of individual who's coming to hard rock down Atlantic City versus in the past. No doubt. We certainly focused on entertainment, you know Live three. I mean that was really about creating and not just music, right, So whether it's comedy with Harry Mendel, whether it's with the need Lander family with all the Broadway shows we're doing,

and frankly really exceeded our expectations. I think it's a real compliment to the hard rock brand, the knee Lander family, but frankly, Atlantic city because the numbers we did with Jersey Boys, we're really really strong. So now we're going to do four Broadway series this upcoming season. As far as the town itself, it's not that we feel it's quote unquote unsafe. We just feel as though that trenton the c r d A. You know, unfortunately, that mayor

was arrested again. You know, we've seen this so many times. Now is the time to come together to say, Look, we've had a company like hard Rock invest over five hundred million dollars. Let's live up to what we said we're going to do to take the next step together. You did tell a p you said, frankly, the town's and we're shaped today than it was when we bought

the building. When you're in a resort environment where safety and security is so important, if the city can't get something fixed as simple as the street lighting, that maybe a change is needed. I mean frustrating. Yeah, So that and and specifically street lights. You would think that the local municipality would be handled that. And if they don't understand that, if you don't keep up with street lights,

then safety can become an issue. But to be fair, we haven't seen crime issues at hard Rock at all to be fair to the city, but frankly, if you don't fix the street lights, you're going to have crime. That's Jim l and the chairman and CEO of hard Rock International. Man. Their organization is huge in terms of hotels, cafes, of course the stadium. They're in seventy six countries. So fun to talk about the big game with him, but

also get his perspective on the global economy. Absolutely. I mean, he really is at the center of so many things in every twist and turn of the global economy, he's got to have a take on and we did catch up with him for quite a bit of time here at headquarters. It's a wide ranging conversation. You can check that out via podcast. It's this Week's Business Week Extra, once the go to destination for Chinese mainland shoppers. The

anti Beijing protests in Hong Kong. While they have definitely dimmed, it's a lord Jason Well. It's been a huge shock to the system in many ways because people aren't showing up to shop and it's starting to really play through the retail scene there. Jim Ellis oversees all the business coverage for the magazine. He's here with us. Tell us

about teal, especially luxury retail in Hong Kong. Well, one of the things that's always marked Hong Kong is that it's been the shopping or it was the shopping mecca of you know, China and of Asia. And but what a lot of people didn't realize was that a big boost for Hong Kong came from the ability of mainland Chinese to sort of go there and do their shopping. It was their mall basically, and that was great for

the last twenty years. The problem is now more and more of the shoppers who need to come to Hong Kong are starting to worry about coming there. I mean, the protests have been very difficult for Hong Kong. Big reason is that a lot of Mainlanders feel that the a that it's dangerous be that you know, people who live in Hong Kong are unpatriotic and are very anti Chinese, and therefore they're like, why should we go and give our money these people who don't even want to be

part of us. Well, it is dangerous, right, there's reports of various mainland Chinese being beaten up. Right, So there have been pressure sports but also the government has been encouraging those press reports and so um, it's all government. Yes, it's all part of a of a of a way to show that you know, right now, Hong Kong is an outlier and China, the rest of China is a

sort of patriotic type. Having said that, though Jim like some of the numbers, I was kind of I kept writing on my notes, Wow statistics in terms of how much retail sales, high end luxury retail sales are down

in the well. One of the reasons is that because Mainlanders account for so much of the tourism to Hong Kong, it's I mean, a lot of people think people from all over the world are coming in there, but eight of the travelers to Hong Kong are from China, and a lot of them are high end, high end shoppers who go there to shop at Gucci, go there to shop at you know, the LBMG. The problem is that they'll come in and spend a lot of money and

then go home. Now two things have happened. One is lots and lots of retails are opening up in cities across China, and now you can shop at luxury retailers in Shanghai, in Beijing and guan Jou, you don't have to make that trip. The second thing is that Hong Kong always benefited from being the air hub that all rich people are business people had to go through to

get in and out of China. That's faded. The government owns three airlines and they have set up three hubs in other cities across China, and so what happens is that nowadays high end shoppers don't have to go through there. So there has to be a reason for them to go to Hong Kong. And it might be because there's more restaurants is or whatever. And now with the trouble from the protests, they're not even doing that. So therefore

you have these huge drops. I mean, so retail sales have dropped in a single month in November, they dropped by and in the high end goods like watches and things like that is over fifty. Now that's started shocking. It's hard to imagine half of your business sort of going away overnight, but that's what's half sing there well, and it's leading to stores shutting down, I mean, and not just one here, one there, but you know, dozens

of locations for certain stores. Yeah, well overall, and this includes high end and low end, and a lot of this is um sort of low end stores. But four hundred stores closed in Hong Kong in the last six months. But then there have been some high end names. You sort of think that, you know that cohort will continue to shop, but um Louis Buitama is closing a store,

products closing a store. Lots of people are saying that this business may not be coming back, simply because even at the protests end, you know the damage has been done reputationally and you can shop closer to home, plus you can shop online. So what are you hearing in terms of, you know, the expectation of Hong Kong is a tourist destination. Does it just go away? I mean, I know the mainland Chinese are very important, but overall, will people start going stop going? It doesn't go away.

It just becomes less of a shopping only destination. It has the advantage of having mountains, it has beaches, it has Disneyland, it has all sorts of other attractions that hadn't been pushed, you know. And so what happens is it becomes as someone in the story says it has become a more holistic travel destination. It can't be just the place that becomes China's mall. Kind of a reminder to that economy, right, that they can't just be about

high end shopping. Yeah, absolutely, really interesting story, a look at something that we all can understand because that shopping element crucial to the economy. Jim, thanks, thank you. And that's Jim Ellis, business editor for Business Week. He has spent a lot of time in Asia. He understands that market really well. And wow, so much going on in Hong Kong well, and you have to wonder these workers that are being hit so hard there at the lower end of you know, the economy in Hong Kong not

making a lot of money. If they leave, will they ultimately come back when things improve? So we'll have to see what happens. The reality, sales have never been better on Palm Beach, apparently, Jason, except for a cluster of home we're talking about the Barrier Island right there off the coast of Florida. The president, his primary resident, President Trump, mar Lago we're talking about, and yet there's a cluster of homes right around mar Largo. There for sale, but

nobody's snapping them up. What's going on? James Tarmy headed down their tough assignment this time of year at the head to Palm Beach. But he's gotta do it, gotta go down there, spend some times. I am willing to take on the hard one for the team. Won't stop. Remind everybody, I mean, we know Palm Beach. It's where a lot of financial types live. Um incredible homes. Well, they don't live there, they have homes where Carol is correct. They now all live there because of the extremely generous

zero percent personal income TAXT. So a lot of people do live in Palm Beach. Um. It's this very surreal place because it's incredibly sin most of the time, there's no more than two or three lots deep between the bay side and the ocean side. It's and everything has hedges in their palm trees, and everything is pristine, and people look like you would imagine that they look and dress like they would imagine in your dress, and it's

and so forth. And it's expensive real estate. It is very expensive, and it has only gotten more expensive this year where it has been white hot um three homes last year sold for approximately a hundred million dollars apiece. Um but yes, a piece, a piece, Oh my god. Yes, So the it's it's really flying off the shelves, empty lots, tear downs, mansions, everything in between. Everyone is buying, is

the answer. People from all over the country are buying, but also people within Palm Beach or trading up and treading down. And it's very much this kind of weird microcosm where real estate is constantly being changed hands, and so within listen to ecosystem. There is around mar Lago, which is this former estate for Marjorie Merry with their post. It's this colossal piece of property and pong beage that cuts bisects the entire island. Um. So around this estate

there are a cluster of unsold houses. Some have been on the market for years, some are just coming onto the market. But it's a crazy anomaly. Things like this don't usually happen, and so the question is why. And you have at least a couple of people saying nothing to see here, move along, is just a coincidence. And yet and yet, so what did you find when you went down there? What are the consistencies among the properties,

What did you take away. So this to give some context, there is something that's called Billionaires Row, which is directly south of mar Lago, and that is where, if you can believe it, there are a lot of billionaires. Directly north of Mara Lago is the estate section. These are all Realist eight fabrications, yes, but they are in whatever way reflective of the fact that homes are oftentimes in and around Moral Lago around five to twenty million dollars right,

not cheaper. This is not a cheap place to live. And what's striking is that there's a tremendous amount of new construction. There's a tremendous amount of recently renovated buildings, and they are all for sale and they are not selling. And so I talked to a variety of brokers. Um,

everyone had different solutions, everyone had different diagnoses. Um. The one thing that everyone agreed on was that it had absolutely nothing to do with Donald Trump, who they all referred to as he as and when he is on the island. No one refers to Trump by Trump's names. It's eight like he his with a capital age and tell us about Moral Argae. You went there, Um, yeah, we see it in pictures. We hear about it all the time. President talks about it quite a bit. What

was the vibe. I would say that the vibe was extremely relaxed, extremely friendly, um and extremely desolate everyone. This is the high season right now, yes, And I sort of assumed that it would be kind of bustling place, especially in December leading up to Christmas, which is when a lot of people are down there. Um, And I didn't see much bustle. To be fair, I was there during breakfast. Maybe it gets hopping in the evenings maybe,

but I was there at eleven. He did sleep one guilty, But it's it's really Everything is kind of very carefully manicured. The staff is super genial. There is a picture of Dollnerald Trump in the men's bathroom. Um, all fun facts, but and and the trash cans even have little kind of golden feet. Everything is as you would imagine it. But it's not this kind of place of outsize that reflects the outside lord of this associated with it. Right. Well, you were surprised to just how easy it was to

get in, right. I think you assumed that there would be a lot of security. There was none. And you know this actually led some level of credence to what all the brokers were saying, which is that you know, many people have talked about in publicly about the inconveniences associated with Trump's presence um and how there's traffic delays and how the Secret Service screw everything up for everyone, but everyone actually there was like, it's really no big

deal and experiencing it in a microcosm. Of course, Donald Trump is not there. When I was there, um, it really wasn't a big deal. And it was actually, I would say, mildly shocking how easy it was to kind of get in and out and how little anyone cared about me. And to be fair, the President wasn't there, so it wasn't sort of locked down as if it

probably would if he was there. One thing I thought was interesting, and I will highly recommend that folks check this out online in the magazine because the properties, Like I had so much fun just kind of reading through the specifics. But some of the homes that because of the proximity to Morrow Lago, they waived the initiation fee right to the club. You don't have to pay annual dues and other things, but that's part of buying some

of these properties. So there is an adjacent road called Woodbridge. And when Trump bought the property in the nineties, he had to convince residents that it was something that they should get behind and not try to block in town councils and so forth. Um to turn this property into a private club. And the way that he sort of greased the wheel was anyone who lives on Woodbridge if their initiation fee, which is now I believe over two dollars,

it's waved. And it's also your grandfather in So anyone who owns a house on Woodbridge gets to be a member at marl Lago. But when you sell the house on Woodbridge, you rescind that membership. So it's it's a really sweet part of the package so long as you're there. And that's James Tarmy. I mean, anytime we sit down with him, we have a blast. He talked about his time down there, looking at the homes, getting into and

walking around more Lago specifically. But it is fascinating that this is a real estate market where there aren't a ton of homes. They're in demand typically, except there are a few that are kind of sitting out there not selling. Yeah, it's a really interesting conversation real estate. It's more complicated

maybe than you think. It's been two years since the Supreme Court ruling that opened up the gambling industry outside of Nevada, and in one of this week's feature stories are Budwei, Well, he actually became a gambler, a degenerate gambler. It feels like depending on who you are, you know, not doing the things he needs to do around the house because he's so focused on the line. He joins this here in New York City. So this is quite

an experiment. Bloomberg funded, Bloomberg approved. We should point out why and how did you do this? Well, we had seen the new handicapping service tout they call it, which is somebody who tells you what to bet uh, and frequently they do that for a feet And there was this new one started by a former Major League pitcher named Michael Swimmer who said, this is going to be legit. Like touts in general don't have a great reputation, a lot of scam artists out there. He said, we're gonna

do this for real. I've got twenty three million backing, I've got Bill Miller, Wall Street money. We're gonna publish our picks. We're gonna give refunds if it doesn't pan out. This is gonna be like the real deal. And I said, well, let's let's see. Let's try it out. So I spent a week in New Jersey, where you can bet legally, bought a week long package of his picks, the company's jambos and uh, and gave it a shot. How does it work? Give us an idea of what it costs

and your experience. Yeah, so I did the smallest package, two fifty dollars for a week. You can spend a lot more, three thousand dollars for seventeen weeks if you want um. And they send picks. They alert you every day about eleven am. That day's picks really depends. Could be five, could be could be forty. Uh. And you try to hustle out and find a bookmaker who will give you the bet there they're saying you should take,

and they've they've checked. They have their sort of bookkeeper of record, their book of record that they say this bets available. But that stuff moves, as I discovered really quickly. So I was, you know, okay, let me get on draftkicks, right, sometimes you don't want to make the bet anymore. Right. So that's the issue for basically every handicapper is the better you are, the faster the market moves, and the

harder is for anyone to use your advice. And that was ultimately what you discovered is that this company was quite literally the victim of its own success. It almost it feels like spoiler alert, almost like put itself out of business. Yeah, I mean there's a couple of ways. I mean that's sort of their version. Events. So they said, as I was doing this experiment, they said, we're gonna stop selling picks at the Super Bowl. And their explanation is lines are moving so quickly after we put out

our pick. In other words, betters and and bookmakers are responding to our picks making right the fluid markets. They're not the same at every bookmaker. Uh, and so this is no longer working customers. And I saw some of that myself. There were a lot of bets I couldn't get, Like I got a hundred and eleven picks I wanted betting like seventy five of them. Um. But there's it's also possible that you know this service what just wasn't just wasn't standing out right that the picks were not

so valuable. They just weren't that valuable, right, So it's hard to say exactly why. But they're saying, look, we're not going to sell anymore, we have different business plans from coming out with new things in the future. Did you make money? I did, but by sheer luck. So those bets that I didn't get to make out of that a hundred and eleven on mostly losers. Just so the company's picks for that hundred eleven period down, and and a better who had been able to get every

bed in would have lost. I was lucky the best I didn't get in losers, so I finished up about sixty dollars. Yeah. So, I mean, you know the businesses sports so well, and you understand so many of the inputs as it were, around how people are consuming sports, you know. But you and I were talking before we came on set about a great story you did last year about John Skipper and the zone into every things

changing around the business of sports. And yet this feels like it's right in the center of all of those things. Two years on is Carroll said at the top, like, what do you make of sort of the legal sports betting scene. I mean it's it's growing fast. I think the money is in there for operators. So we've seen fifteen billion dollars in bets in legal markets since the ruling.

May the draft kings and give us perspective, it's not when you've got to remember that money wagered is not revenue for the book, right, So the revenue for the book is a small fractah, So it's not a huge industry yet, but it's growing fast um, and as more states come in, I think you're going to see an effect of that momentum once you get sort of more than half of the US population, than big national companies are gonna say this is effectively a national market and

get in there well. And also you've had Professional League sort of tiptoe into this a little bit, right, and obviously there there could be a tipping point there where they are more open to the idea that this is happening. They basically have already flipped. They're saying, we're going to

sign deal marketing deals. We're going to try to insist that our data, our official data, is used and that we get paid for it um and really lead the way on that right, Yes, yeah, and so they they've had a lot of success in using data as the wedge to say it's our data, it's our official data. You need to use it, and you've got to pay us for it. So I love in this line that in the story you talk about handicapping and how it has often been a shady business. Still feels like a

shady business. There is a lot and and the Internet, as with everything else, has sort of multiplied it and morphed it in weird ways. So there are a lot of scam artists using Twitter and and that to basically say, I, you know, I'm infallible. Uh, my picks are always right. They're usually somehow shading the truth, if not outright lying about that and then trying to get you to pay a little money over Venmo, you know, for picks. And

that's Ira boot way. He covers so much in the world of sports, and we talked to him earlier about Joe Side. That was a fascinating look at a really important figure. Well, one of the big elements in sports right now is sports betting. It was a huge topic when we were in Miami ahead of the Super Bowl. So, Carol, I want to play part of my conversation that I had with Chris Paul. I should know this was recorded here at Bloomberg headquarters a few weeks ago before the

tragic passing of Kobe Bryant. And yet when I hear this interview, it's a reminder of the strong influence Kobe had on how modern players this generation, players like Chris Paul, really approached the game and their businesses. Here's your conversation. So Chris, let's start just talking business. How do you define your business world? How do you sort of put it all in perspective? And Um, first and foremost, I'm very blessed and fortunate to have an amazing team around me. Uh,

it's never just me. I have an amazing team, Uh, starting with my older brother who's been with me since day want obviously since he's an older brother. But um, through NBA experiences, through business through learning, have tried to learn as much as possible. Obviously being involved with the Union has taught me a lot too, so just trying

to be a sponge. And so when you think about kind of identifying opportunities, is there an overarching theme that you're going for, Because I would imagine people come to you with ideas all the time, come to you with opportunities. What's the screen? You know? It's funny when I was younger and I first came into the league, used to hear about endorsements, Oh this, players endorsing this, and endorsing that.

As I got older, I started to realize that the vetting process for any business deal or anything, it has to be true to who I am and true to what I believe in. And so, um, there's been partnerships. There's no such thing really now as endorsement deals are as partnerships and things that um, I really believe in and products that I use or that you know, I really want to see come into fruition. And how often do you say now a lot? Yes, yes, you know it's it's one of those things where um, I am

a people person. I love to, you know, engage and talk, but you have to learn to say no, or at least have somebody on your team and that can say no. So it feels like you are building a platform as it right. You know, I look across your media activities, your partnerships, your investments. How do you sort of break that up in terms of figuring out you know, you want to focus more media, you want to focus more on more traditional partnerships a state farmer, Nike or or

or what have you. How do you sort of bucket it? You know, it's funny you ask that, because it's almost like being an athlete when you talk about playing basketball. I don't just say that I just shoot. I don't just dribble. I don't just uh, you know, block or dunk. I don't really do that much anymore. But but I try to stay as well around it as possible and try to dip in different avenues, you know, whether it be entertainment, whether it be focusing on nutrition, which is

a big part of my life. And you know, this is my fifteenth year in the NBA, so I focus on on a few different things. And so how much do you think about dare I say, a post NBA career and and how much of what you're doing in business is about setting you up not just financially but but almost mentally for what that career looks like after the league. Yeah, there never be anything I believe that drives me the way basketball is. You know, you never say like I'm ready for it to be over. I

don't think any athlete ever says that. But I'm always just trying to learn and be a sponge and a lot of it is that is, uh, you know, sitting here even having the conversations with you, learning and talking. And I have a few mentors out there that I'm constantly on the phone with just trying to understand the world. You know, a lot of people want to know what is it like when you hit a game winning shot? You know me, I'm like, what was it like when

you close that deal? How did you have these hard conversations? And I think those experiences help you for the business world. I want to talk about a few specific deals and partnerships that you have. One of which we've spent a lot of time over the last year talking about, is Beyond Me. You were early to that, Uh, you were plant based as of last year. I believe clearly this is something you believe in. But tell me about it

from a business perspective. Yeah, so Ethan from Beyond Me who was amazing, and I had an opportunity to get involved in it, and I actually got a chance to executive produce a documentary called Game Change Right. And so as an athlete, you're always trying to figure out different ways to to get an edge to whether that's training, whether that's working out, and once I've seen game changers, and um, you know, I saw what the other athletes were saying. I was like, hold on, I gotta try this. Yeah,

I gotta try this. And obviously beyond meat has has been amazing. Like you said, you had the beyond meat sausages I did I could get last night, you know. And for me, um, it's just it's been life changing for me in the way that my body feels and the way that you know, I can bounce back back to backs, and it's you know, you know a lot of times you hear people talk about diet, diet has to be a lifestyle change, and for me, for me,

I would say it's helped. So from a business perspective, you've also as a player, seen a lot of different cities, a lot of different business cultures in a way, and you know, I think about l A obviously, I think about Houston, I think about Oklahoma City. Now at this point, what have you learned from sort of those different markets from a business perspective. That's a great that's a great question.

And I've had a number of teams that I played for. Obviously, when I was with the Clippers, Steve Balmber, you know, took over as owner of the team, so I got a chance to see how he dealt with different things.

Being in Oklahoma City has been amazing. Also. One of the first things that we did that you don't see a lot of times around the league is the day a few days before training camp, we had a huge cookout, a huge cookout where everybody in the organization brought their families, you know, and in the league where a lot of times it's just ball ball ball, it was nice to you know, see, uh, the guys who handle our tickets with their kids and with their family, and like I said,

it's just learning, learning, because uh, in any business, I think most people want to try to create that family and that culture. And I think that was really nice in Oklahoma City. And so what is it like playing in sort of a smaller market in a lot of ways? I mean much has been written and talked about with Oklahoma City from a basketball perspective, specifically hitting way above its weight. I mean, this is not a new phenomenon, but I do wonder what that experience is like for

you It's been great. And probably I'm a little biased because I actually started my career in Oklahoma after her can train them, right. You know, I spent two years there in that fan base. Nothing like it, nothing like it the way they support you a night in the night out. Um. You know, they may call it a small market, but the fans, they have big hearts and they're behind you night in and night out, and so um, it's nice. I've been able to experience both, and you know,

I love both of them. Well. It's also interesting, I think, even from a player perspective, to think about sort of the legacy of players that you're obviously now I'm part of that have gone through that franchise, that have raised it to a national prominence that that maybe you don't see even another sports And I tell you to be

part of that. Oklahoma city history and culture is special and like I said, uh myself, with David West and the number of guys we got a chance to start out there when they were basically auditioning for a team. And then you know, Katie Russ, Nick Collins and James all those guys come through and that city show what it was capable of, and you know, a team will be there probably forever. Yeah. So you mentioned your role in the union, and I want to talk to you

about that because obviously a very important position. Uh, not one without controversy, not one without some conflicted and conversation. What's the biggest thing you've learned from from holding that role. You've been in that job for a while now, Yeah, right, that sounds about right. I'm like, uh, may feel longer, but I've learned so much, so much. UM. I've always said this, I went to college for two years. No business class could teach me the on job training that

I've learned as president of the union. Um. From the other players on the executive committee. You know, you just learn how to talk and communicate with people. Michelle Robberts, our executive director, She's taught me so much, other people that work within the union, the conversations I've had an opportunity to have with Adam Silver, you know, just constantly

learning and really understanding the business of the game. Because as a kid, when you're in the backyard, you just like, you know, I'm m J I want to play in the n b A. You never think about the business of it. And so to learn that has has truly been. Um, just it's so valuable, right you mentioned Michelle Roberts. I know that some succession planning is going on there. Where are you at that point? But what do we see next? Um, first and foremost is not just Michelle, you know, it's myself,

you know, I Dragon Dollar. We have board members and stuff that have been in this position for for a while. And that's why I say the importance of mentors and businesses and uh, one of my you know, huge mentors and and Eiger is that's one of the first things he said. Yeah, yeah, for those of us who don't call one of one of one of the first things that he sort of you know, told me years ago is that succession planning is real if we want the

union to be a real business. You know, most big businesses have succession plan and so that's all it is, right, So what what's the most important element of succession planning for that particular part of the organization. Just making sure that whoever the next person in the line is no

about the conversations that are being had now. And so that's what I'm doing also with other guys that's on the board and trying to find out who may be interested in being the president after me, right, you know, and just making sure that you know, if there's conversations

being had now, they're involved on them. That way, if they do take over, it's not just brand new And that's NBA star Chris Paul, you know, beyond meat state farm, so many things that he is constantly thinking about, taking care of his family and sort of being there for them, all the things that happen in the modern life of an NBA player. Well, I think, and it's interesting you're seeing athletes that's no longer just here's my name, put

it on merchandise or what have you. They're very, very involved. I feel like in the investments that there and even the terms that he uses. He doesn't do sponsorships, he does partnerships, and it's a much more holistic approach to be sure. Well, that wraps up the weekend edition of Bloomberg Business Week from Bloomberg Radio. Thank you so much for joining us. I'm Jason Kelly and I'm Carol Masser.

Be sure to tune into Bloomberg Business Week Radio Live Monday through Friday starting at two pm Wall Street Time. And you can't catch us live, get our daily podcast wherever you download your podcast. You can also watch the show live on YouTube. Just search for Bloomberg Global News, and you can get this week's edition of the magazine on newsstands now. Will be back next week at the same time. This is Bloomberg