Bloomberg Businessweek Weekend-October 17, 2020

and new thought. Former Mayor of Kansas City Slide James on the impact of the virus on education and getting out the vote. Plus, there will be a lot of changes as we move forward, bringing back Broadway with the president of the Broadway League. We begin, though, first with the presidential election now just a little more than two weeks out. Florida has become a battleground when it comes to the November elections, and as Josh greenwrights, Florida seniors

could seal President Trump's fate. On election night, bloombergs Paul Sweeney and I caught up with John National correspondent at Bloomberg Business Week, along with Bloomberg Business Week editor Jille Webber, as Josh writes, Uh, in this dispatch, Um, we're really looking at an outcome here that for Trump to have any real certainty of getting back and retaining the Oval office, he really needs Florida, and so the Democrat strategy is obviously to try and take Florida out of his hands.

But what Josh actually gets into here is the there are some early numbers that we're seeing from Florida, and the swing among seniors UM, which is a demographic that Trump had had locked down last election, is just one eight and is already in early numbers, is veering towards Biden. Josh, what does that mean in the grand scheme of things, Well, basically, what it means that the current trends continue, Uh, Trump isn't gonna win Florida, and Crump doesn't win Florida, He's

not going to win the election. But what's really interesting about this is we've all been reading about these nightmare scenarios where states don't count their vote and from the weeks and the election is consisted. What's great about Florida is that it counts its votes early as they come in. So about of the votes early votes already cast in the twenty general elections have been cast Florida and have

already been counted, and Florida updates those numbers. So what we did was we took a look at who was voting early, and the thing that really jumped out was that seniors, voters age sixty five and vote or older, we're voting at the ten then later clip in than they were at this point four years ago. If you

look at the poll numbers. We wrote about this in our election issue in Business Week in September, a group that I called swinging seniors senior supported Trump, not necessarily what you think it might mean, So I better explained senior supported Trump at a seventy point in origin. Uh. The latest polls in Florida have Biden win seniors by

fifteen points. So if you add those two things together, a huge swing to Biding among seniors and a huge outpouring of support, it isn't surprising that this is good news for Biding. And if it keeps up at this pace, what I say is we will know on election night whether or not Biding his one Florida, and if he has, I think he's a very good chance that he's going to be president. So, Josh, what has the president quote unquote done wrong? It's certainly not for lack of effort

down there. He was just down there again campaigning. What's really been the change? Well, there have been two things. I mean, number one in the easy answer is COVID. He was down there to a gigantic, maskless rally in Orlando. Um, which you might imagine, Uh, spooks it awful lot of seniors. If you look at the main drive or the senior vote. It's been Trump's handling of the COVID pandemic. Uh, doesn't seem to have a lot of inspired a lot of

commerce among older voters. Not necessarily surprising, but you know, as I saying, the piece of the big question about early voting is are these new voters? Is this is this genuine enthusiasm or have older voters simply moved up when they cast their ballot? Are these just people who vote anywhere on election day deciding to vote early through the mail because it seems safer. Um, that's certainly some

of it. But the other interesting factor here is that it appears to be much broader than that, and much broader than COVID, because if you go back and look at the results of mid term elections, there was once again a huge spike in senior voters, and of course

that predated COVID. So what we can conclude from that is its seniors are much more eager to vote and seem to be much more willing to vote for Democrats now than they were in And if those trends continuous Florida, where they're especially pronounced because there are so many old people there, uh, it really spells bad news with them. Well, and what's interesting is you have to think Josh at the Trump camp is a little bit worried because you think about the video and he did you know, after

coming out of the hospital. It was aimed directly at seniors. Yeah, so when Trump was was cooped up in the White House, when he was still contagious with coronavirus, he shot a kind of an awkward cheerleading video on the on the lawn of the West Wing. Um there was aimed at reassuring seniors, you know, I love you, I care about you, you know, so on and so forth. I think that was a clear reflection that his campaign staff was looking

at the same numbers I am and seeing themselves. Oh, you know, unless we change the mind to the senior voters pouring out to the polls and into the post office to mail their ballot, we're gonna be in real big trouble. Let's try and turn this around now. I think the problem is, you know, it's really hard to change public impression of how you handle the pandemic if you come out of the hospital, stick with COVID and then turn ondis letter and have a maskless rally like

Trump in Florida. That's Bloomberg business Week national correspondent Josh Green, who's also author of Devil's Bargain, Steve Bannon, Donald Trump, and then Nationalist Uprising, along with Bloomberg business Week editor Joel Weber. We know it was a busy week when it came to politics. The presidents certainly out there on

the campaign trail, so too was the Biden campaign. And an interesting development because we heard that Democratic vice presidential nominee Kamala Harris she canceled her travel until Monday after her communications director and a member of her flight crew tested positive for COVID nineteen. So some developments along the campaign trail. Speaking of the election, he's been working on getting out the vote and also writing the world when it comes to injustices. We're gonna check in with former

Kansas City mayor Sly James. That's coming up next. This is Bloomberg. This is Bloomberg Business Week with GARYL. Masser from Bloomberg Radio. So common themes through many of our interviews throughout the week on our daily show had to do with the two pandemics facing our country. We're talking

about the virus and racial injustice. Bloomberg Paul Sweeney and I got into that with our next guest, known for his bow ties when he was mayor of Kansas City, Slide James is now focusing on building cities for our children, prioritizing education. You had a book that came out over the summer, the Opportunity Agenda, a bold democratic plan to grow the middle class. We talked to education, we talked

the pandemic, and of course getting out the vote. This pandemic and the economic upheaval that's caused along with the social upheaval. It's kind of like the perfect storm. Every fissure and crack in our society is being opened and laid there. People are able to see it. And one thing about these, uh, these disruptive times is disruption is

an opportunity for innovation and new thoughts. And if we look at it like that and recognize that we've got problems and work on them, we may be able to bring some new ideas to the forefront solve some of these problems. Sly, how about in terms of education kids around the country or back at school, some virtually, some physically,

some hybrid model. But what we've seen from last spring and now in the fall here is minority students are really at risk here of I guess falling through the cracks, are certainly at a disadvantage in this new virtual learning environment. What are your thoughts there, Um, Well, first of all, I agree with you wholeheartedly. I think minority students, but I'm going to broaden it out to say children who live in poverty are are all at an extreme disadvantage.

They do not have access to the resources. They do not have access to broadband, they do not have access to the hardware, they do not have access to the innovative ideas that money and higher resource levels are able to bring that their more world heeled counterparts to do. Um, the problem that we have, of course, is that it would be one thing if we were at the top of the heat that we were talking about an incremental fall that puts us someplace in the middle of the pack.

But we're not at the top of the heap. As a society and education we're falling faster and fast or behind other countries. So every kid in this country is falling behind our competitors around the world, and our kids at the bottom of the ladder are about to slip off and fall into the abyss. These problems have been there, uh they are now just being laid there and open because of this pandemic has forced us to look at

them in a different way. It's not The good news is is that people are looking at them in a different way and maybe some incremental change that's going to happen, But without a systemic approach to it, without an intentional approach to it, we're going to continue to have the same education gaps that we've always had. They may shrink a little, but it's now time to look at it for what it really is, a disaster for the long term economy of this country and fix it. Well, what

you just said, a systemic approach. It's a systemic problem, so it needs a systemic approach. So if if you could list I don't know a couple of things that we need to do already, because I'm so tired of the convert state. I'm not tired of the conversation. I'm tired of people talking about it but not doing something. What would you say we need to slide? Well, first of all, I think we need to find political leadership

that's not afraid to lose um. And by that I mean we can't have leaders who will do anything to stay in office, even if it means giving up ideas and ideals that they know are valuable. We've got to have people that are willing to say I'm going to fight for this, and if I lose, I lose, but

I'm going to fight for it. We need sustained leadership to focus on this and this and and it can't be subject to the normal O uh democratic republican rebound philosophy that we see so often, where one party gets in does some droubles the ball for a bit, the other ball comes in and steals. Other team comes in and steals the ball and dribbles in the opposite direction. So that at the end of the day, neither side is doing much of anything you said, dribbling away from

each other. We need people who are in charge who recognizes number two. We have to recognize that people. People need to find a way. We need to find a way to bring people together in such a way that they actually influence an impact the leadership. Not talking about lobbyists, not talking about business. I'm talking about people who say this is important to us. And frankly, I wish I

had a magic wand for it, but I don't. But I do think that we have to start educating, little by little the importance of early childhood education as a precursor and a foundation eliminating the thirty million word gap. We need to focus. We need to force more resources into the zero to five states, which is going to help on the long term solution and on the short term solution. We really need to tackle the third grade reading deficits that we have because up the third grade

you're learning to read. The third grade on you're reading to learn, So obviously, if you haven't learned to read very well, you're not gonna learn very well. But all of this starts with conversations like this Carol and Paul and and mobilizing people to understand how valuable what we're

talking about really is. So I'm just thinking, um, sly, all the things that we've talked about, and you know, the children who are living in poverty and the disadvantages, and the importance of making sure that everybody gets a good education, because it really makes a difference, you know, in your lives or in their lives. And I do wonder how you think about the vote in November and the outcome of that vote, and how that could possibly

change those things. Well, I think that there is a lot of sentiment that the vote is being driven by whether or not you like Donald Trump. Um And frankly, whether or not you like Donald Trump may be good for the vote in this particular instance, may affect change, but at the end of the day, that's gonna wear off pretty quick and people are gonna have to stand on their own merits. So the question then becomes, what

are you doing for me? Okay? Uh? Winston Fisher and I when we wrote the agenda, we deliberately wanted to point out that people should add that people in leadership should say, here's what we are doing for you. Uh, and maybe if they can internalize that, they will stop doing so much for themselves and do more for you. But at the end of the day, Uh, what we need is a new approach to leadership. We need a better and different coalition between business and government. We need

more P three's. Here's an example of a P three possibility. One P three possibility to address the childcare situation would probably be more on the local level, but with businesses, where government and local businesses would enter into a P three arrangement with businesses so that those businesses engaged would have access to high quality pre K with some government helps, subsidies, tax credits, whatever the case may be, so that then

there could be some quality control. Another opportunity for P three's would be to have something like what Anthony Fox did with his transportation grant lenge grant. It was about access to broadband and transportation, et cetera. But have challenge brands so that you could have some incubators of some ideas incubators. For example, on the issue of early childhood education, how's business and government combined their efforts and resources to

improve our quality pre case system. That's former Kansas City Mayor Slide James his book The Opportunity Agenda, Bold Democratic plan to grow the middle class. Do you want to point out he's graduate of the Bloomberg Harvard City Leadership Initiative education program sponsored by Bloomberg Philanthropies. You're listening to Bloomberg Business Week. Still to come. She's got an agenda too, and that's to get Broadway reopened in New York City safely.

Charlotte St. Martin, president of the Broadway League, is coming up next. This is Bloomberg. This is Bloomberg Business Week with Garrol Masser from Bloomberg Radio. We're bringing you some of the highlights of our daily radio broadcast and podcast, and that included someone we've checked in with several times during the shutdown in New York City. This time around, Bloomberg's Paul Sweeney and I caught up with her on the heels of news that there would be no Broadway

theater until at least June. Here's Charlotte St. Martin. She's President of the Broadway League. Many things to bring everyone back when it comes to the theater industry, and to do it safely, and that included figuring out testing the fact that there hasn't been uh, a verified rapid test that is secure, which we have to have for the cast and crew until the virus is gone. And that doesn't even address the audience, which we also have to

give the right products for the audience. And with no news about that now, we just felt that we had to be as open and transparent as possible with the people that worked for Broadway, work on Broadway and our theater goers. So many of those nine thousand employees that depend on Broadway to work need to have as much advanced notice now as possible so that they can try to find other work. Since the extension is so far out, Charlotte, what do we know about the economic impact to date

on those employees on the theater owners? I think about these beautiful theaters in Midtown Manhattan on the West Side, just sitting idle. Talk to us about some of the economic impacts you're hearing about. Well, for our last full season, the loss in ticket sales was almost two billion dollars and the loss to the City of New York was

almost fifteen billion dollars. It's uh, everyone loses with this, and it's hard when you're talking billions to put a face to it, but in fact, you know, the face has ninety seven thousand faces that are unable to collect a paycheck. And you know, most of the organizations I know have reduced their half as much as they can so that they can reopen when we have the opportunity to reopen. So it's it's not good news anyway you

look at it. I know I was thinking about and I guess I was reading something to you know, just I mean, if you think about people who go to theater, I mean, they're all ages, but there's a lot of older theater goers, you know, lack of tours that are coming into the country now, and then you've got old theaters where the idea of trying to do social distancing it's just you can't do it, you guys have It's just really difficult on so many different angles. That's absolutely right.

And while you know the average age of our audience is forty two point three, I think there's still certainly a large percentage over that age and a large percentage under that age. And these are hundred year old grandams in many cases our theaters. And you know, as someone said to me, have you ever watched a one minute costume change with three people making that change in the in the space the size of a phone booth. So

you know that social distancing justice at work, Charlotte. Are there any parts of the world where live theater has come back. I'm thinking about you know, London or other Paris or other major markets where it's come back. Or is this kind of a universal thing? Now? This is universal? You have Korea is the only location that I'm aware of that has reopened without social distancing. And it's a brand new theater with giant lobbies and giant stages and

big spaces. And uh, they have a culture of wearing masks and and behave much better than a lot of our lovely Americans who can't seem to put those masks on. So um, for the most part, you have a few venues that are trying social distancing, and it's just you can't financially make it work. In New York City, we have seventeen union contracts that UM require our theaters to be over full just to return on investment for the people who make theater. And if we don't return, we

don't get theater. So uh, it's it's still we have not found a solution to socially distanced in a safe way. Did you say they have to be nine full No, I said ninety. Okay, yeah, no, because I remember us talking in the past and it was this whole idea of you know, could you do something virtual or could you do something partial? But it's just the mathematics just don't exist, Charlotte, They don't, and we wish it did.

But you know, everybody, the besides the people working, I mean the creatives, the theater owners, the producers, everything, the model would have to change, and I think we're not ready to do that just yet, because we certainly haven't. And when you talk to you know, when you talk to theatergoers, part of what the joy of going to theater is the shared emotion that people have. There will be a lot of changes as we move forward. That's Charlotte St. Martin, who is president of the Broadway League.

And yet lots of change, is no doubt about it. And listen, the way back is not going to be easy. And of course she's not going to be able to get all of the shows that were on Broadway back up really quickly. It's going to take a little bit of time. But listen, employees who depend on work in Broadway. We know this is an important industry, certainly to New York City. All right, still to come. Theater is still shut,

but retail shopping certainly not up next Amazon's domination. I see lots of opportunity for Amazon, certainly to grow in this country. Everything they've done in this country with regards to shopping, they're replicating all over the world. We'll hear from a former Amazon insider. This is Bloomberg. This is Bloomberg Business Week with Garrol Massier from Bloomberg Radio. We'll not sure if you know ist or more likely you did and probably actually did some shopping on Amazon Prime Day,

which was two days this week. The event expected to give the world's largest e commerce company an early advantage of our brick and mortar rivals ahead of Black Friday. James Thompson, he's partnered by Box Experts as a managed services agency supporting brands selling online. He's also former business head of Amazon Services. He shared some thoughts with Bloomberg's Paul Sweene and me and Amazon's growing dominant. But we

started with a question, are we already holiday shopping? I'm fascinated with this whole preconceived notion that somehow this is the beginning of the holiday shopping season. And the reason, the reason a little confounded by this is typically when people buy things on Amazon, if they're going to buy them for gifts, they send it directly to whoever they're

gifting it too. And so I ask you, would you be buying Christmas presents right now in the middle of October and sending it to people two and a half months early. No, you know, the the application here is people are spending money on themselves. They're not spending money on other people. At least that's my hypothesis. And it'll be interesting to see what happens when we get to end in November, when the normal start of the holiday season kicks in. But right now we're seeing people buying

stuff that they're they're they're enjoying themselves. So I guess there's a lot of disposal income out there because the sales are absolutely through the roof, even more than we expected for Prime Day. So, James, as we think about this pandemic, it's impact is so many facets of so many people's lives, daily lives, and one of that is retail. One of those is retail give us your sense of to kind of how this this move towards e commerce is accelerating here during this pandemic. If so, and then

how permanent you think that might be. So. Obviously, when everyone started quarantining at home, that there were a few few other options for buying other than going online. And one of the interesting aspects of what happened in March and a prill is that a lot of people not only moved more dollars online, but they started buying products that they had never before gone searching for online. So many of us were buying grocery products that you know, we were used to win the grocery store and now

we're stuck having to look online. And if you if you did a curbside pickup or you had groceries delivered to you, you know, for some people that was a very good, good experience, and they're saying, gosh, I didn't realize my life could be so easy. I should have

been doing this a long time ago. Likewise, there are companies that obviously we're well positioned to sell online, and there were lots of retailers that were not well positioned at all, and so trying to play catch up and build yourself a website, figure out how to get logistics

in place to deliver packages. That's really hard. And as I think about what's going to happen here later in Q four, some of the retailers who still won't have enough stores open to generate meaningful foot traffic, they're gonna have to rely on their their websites as to drive traffic.

And quite frankly, it's one thing to sell your volume through an online site, but what if your volume now has to go online and you don't have good inventory software, and customers are saying, do you or don't you have this product? Can you get me this product quickly? One of the things that we're gonna see I suspect in the next six or seven weeks as we move into mid December, everybody except for Amazon is relying on UPS and FedEx and the postal service to get packages delivered.

Amazon owns last mile delivery for two thirds of its own packages, so their ability to say to customers, we're comfortable that these products are actually gonna arrive on time when you order them on December twenty, You're gonna get them by nine o'clock at night on decem What about everybody else who relies on you ups and FedEx. It's gonna be interesting to see how the big carriers are able to support this crushing level of demand for online

order fulfillment. So it's interesting one of the things that James is just talking about, You know, can people coming onto the Amazon platform or every it's so crowded, there's so much availability, there's so many different brands competing against in effect Amazon, some of some of their brands. How do you talk how do you consultant and explain to

your clients what's the best way to compete there? At the end of the day that there are some formulaic things that every company selling on Amazon needs to do. You need to have the very best listings, meaning you've got to have the right images, you've got to have video, you've got to have high quality content that helps answer customers questions. But that's basic black walking and tackling. Unfortunately, lots of companies selling on Amazon don't do a particularly

good job there. There are questions around how do you make sure you stay in stock? Amazon penalizes products that are in stock out of stock, in stock out of stock, so you've got to remain in stock and be in a position where customers can consistently find your product. And then the big catch all here is Amazon says, if your products are Prime eligible, we're gonna reward you with better visibility for customers. And so, uh, you know Amazon Prime.

Some people know that as FBA, some people know that as buying your Prime membership. But those are the products that are presented to consumers first and foremost on Amazon when you go looking for products. If I go searching for men's running shoes, I'm going to see all the Prime eligible products first because I'm a Prime customer and I'm playing in and Amazon says I want to show you Prime eligible offers. There are too many companies on Amazon today who have said, let me dip my toe

into selling on Amazon. I'm just gonna fulfill a few orders as they come in. Well, it's a self fulfilling prophecy. You're irrelevant unless you're Prime ilig. It's like unbelievable. I've done it myself. I think I've even paid a little bit more because I know it's Prime and I'm going to get it quickly and it's gonna be easy. It's just pretty fascinating. I gotta tell you, I'm listening to you James talk and I'm just thinking, where does Amazon

go from here? You know, where's Amazon in your view? You know, you know this company so well, you see their domination. And I think that's a fair word to say when it comes to retail, where do they go in the next two years, in the next five years? The reality is Amazon starts by saying, how do we do more for customers? How do we focus on what customers want? And for twenty years they've been looking at how do we deliver as much selection as quickly as

possible at low prices. And the reality is, as you grow your business and it becomes five times bigger, fifty times bigger, five hundred times bigger, it gets harder and harder for Amazon to do that. And yet they continue to step up and do that. And this year they've demonstrated that they're not just a marketplace, they're a massive logistics powerhouse. I mean they hired a hundred seventy five people in order to do last mile delivery of your packages.

That they are now at a place where they are competing with FedEx and ups day to day for all the most profitable routes. And that's that's pretty staring when you think of Amazon as being a shopping destination, but yet they support all these other things behind the scenes that consumers don't necessarily see, but are critical to keeping the core business of a shopping site to keep that running. So it's expensive to do that. It's really expensive to

do that. It's expensive to do that, but it's actually cheaper to do it yourself if you do it at a scalable level than it is to wait around for UPS and FedEx to figure out how to grow fast enough to keep up with Amazon. And that's exactly what we saw when Covid kicked in in March is the UPS is and FedEx is they can't keep up with the increase in demand that Amazon's experiencing. And quite frankly, Amazon doesn't have to make any money with their fulfillment capabilities.

They just have to be able to make sure the pipe is there and they can push packages through the pipe. And that's one of the beautiful things about Amazon. You know, the same thing happened when they built out their AWS capability. That wasn't meant to be a profitable business. It was meant to be back end services that would support huge numbers of customers flow flocking to the site. You know,

on Black Friday, we to have essentially infinite capacity. Amazon said, we'll build it ourselves, and then he discovered, oh, we can now sell excess capacity to someone else. They're gonna do the same thing with logistics. Eventually they're gonna be in a place here in the next year or two to start offering more shipping services to retailers who sell packages to people, not just on the Amazon site. That

that's a nice tidy business. We know Amazon has gotten into the healthcare business starting with how do you build out better, better options for Amazon employees. But the reality is if Amazon gets this figured out, that's another trillion dollar business where Amazon would say I'd like a slice of the bi please. So I see lots of opportunity for Amazon, certainly to grow in this country. But everything they've done in this country with regards to shopping, they're

replicating all over the world. They've got over fifteen marketplaces now different countries they're moving into where they're saying, we can do the same thing and help local consumers in these other countries get huge, huge amounts of election at low prices, delivered quickly. I did say, don't say domination, and the legal scholars, you know, the anti wrestlers gears

perked up. So it's interesting you want to think, and you point out that it's expensive, but I'll also point out they've got seventy billion dollars of cash on the balance sheet, forty billion dollars of free cash flow, so I guess they can afford it, um James. One business where they haven't been so successful is the grocery business. Is that just a sideshow for them? Or do you think that they want to get bigger, better, stronger in that retail space. They need to get better. And I'll

tell you why. If you look at your wallet, the share of your wallet that goes towards grocery is a sizeable chunk of your spend. And it's also one of those purchases you make at least once or twice a week. You're having to think about where do I go to buy my groceries. Amazon wants to be in a position where consumers say, I need to buy something, let me pick Amazon first is my channel, and let's see what they have. If Amazon can get enough grocery selection in

place available for fast delivery. Then Amazon will be able to get consumers to spend that part of their wallet on Amazon. And that's too, maybe two or three times a week, the consumers again are reminded, hey, Amazon is the place I need to go to buy everything else as well. So at the end of the day, grocery may not be a very profitable business for Amazon in and of itself, but it's a constant reminder, and there's a constant ad for consumers to come back to buy

everything else that may make Amazon more money. And we certainly are heading to Amazon for just about everything else certainly feels that way. Or that's James Thompson, partner at Buy Box Experts and former business head of Amazon Services. That wraps up our first hour of the weekend edition of Bloomberg Business Week from Bloomberg Radio. I'm Carol Masser morehead in our next hour, including the one billion dollar

idea behind this year's Nobel Prize in Economics. Plus we'll wrap up with some lighter fair millennials shaping the beverage industry and a professional poker player on making better choices. This is Bloomberg. This is Bloomberg Business week with Garrol Masser from Bloomberg Radio. Hi, i am Carol Masser. Along with Bloomberg's Paul Sweeney, plenty ahead for you in this

hour of the weekend edition of Bloomberg Business Week. Our second hour here and we talked a lot about working from home, working remotely this week on our daily radio show, including catching out with Stoke Talent CEO Shahar Rez. We talked about shadow hr and properly managing freelancers working remotely. We also talked a lot about the growth in the gig economy. Plus pro poker player Annie duke Man Poker

is definitely in the family there. She's got a new book out, How to Decide Simple Tools for making Better Choices. We begin this hour, though, with a walk around the block with our own Peter Coy and a trifecta of his stories, as only Bloomberg Business Week Economics editor Peter Koy can do. We talked about the President and economics, We talked about the said, and we also talked about

the Nobel Prize in Economics. Bloomberg's Paul Sweeney and I got more from Peter and Bloomberg Business Week editor Joe Weber. The story that he just had a quick take on was actually Trump speaking to the country's economic club for that I thought was actually kind of interesting. And Peter, what what was your takeaway from from getting to watch that. Well,

it's not his typical audience. It's a bunch of rich people, some of them richer than he is, um generally prosperous business people who belonged to the economic clubs in Washington, New York, Chicago, Pittsburgh, Florida, and so on. And he didn't seem as comfortable with that audience as one might expect since they're mostly one per centers who generally agree with the Republican agenda of tax cuts and the regulation. There were times when he sounded even a bit defensive

and worried that he didn't have their support. He called out internationalists, lobbyists, a drug company executives, all of them we presume were part of his audience. Peter, what do we know about the president's current standing um with big business, with Wall Street, with folks who benefit from the Trump

tax cut. Well, we they liked the tax cut, Like we've we've seen some critical, pretty critical comes coming up from organizations like the Business Roundtable, which represents CEOs of some of America's biggest companies, and very often CEOs don't want to be on the line themselves criticizing any administration, Republican or Democratic. They will sometimes hide behind the voice of a round table like that so they can't be

sort of safety and numbers kind of thing. And some of the statements from the business round table have been fairly critical of the president and things like why can't we get another round of stimulus done? So this was this was interesting. It continued that thing, and like one of the things he said was, Hey, I know some of you out there Democrats, and I don't understand what you're thinking. You know, some really bad things are going

to happen if Joe Biden gets elected. So, Peter, the other story that you have in the current issue of the magazine is is not about the president at all, but sort of another elephant in the room, which is the FED. And and I thought you had a sort of a big idea. You spent some time thinking about it, and it's ultimately about the FED being basically the most dovish Fed in the history of the Fed. Can you can you tell us more about how why why that matters?

So much right now. Just reminder, dovish means that you're soft on inflation and more worried about unemployment, or the hawk would be the opposite, And the FED traditionally was hawkish.

It was probably more hawkish than the President whoever was in office of the time, or Congress, and it was almost designed to be that way because you wanted to have the central banker be the tough guy, you know, the enforcer, the cop who would try to make sure that the economy did not overheat and causing UH runaway inflation.

But now we're in the opposite circumstance where we're actually worried about inflation being too low and the economy being chronically weak, and the FED has moved around to being UH. And it's not just because J. Powell is the chair of the FED now. It was starting to happen under

Bernankey and yelling as well. But I think with the actions of this past spring and response to the pandemic, and then now with J. Paul jaw boning Congress to do new stimulus and the interspace being at zero and the new dovish language coming out of the FED in August, it does seem as though it's the most dobbish FED in a century, namely forever for the Fed. Well, and it could work out, right you you kind of play

out the dream scenario, Peter. You know, if all this messaging from the FED works, I mean, right, the economy improves, workers get more money, consumers open up their wallets, um, you know, and we all live happy life if it all works out. Obviously, the optimistic scenario that the stimulus works and inflation moves up to two which is the Fed's goal, and maybe even goes a little above it. That's the new thing that the FED is doing now.

It's saying you can actually even welcome inflation overshooting the two percent target to make up for periods of undershooting. And that's going to be very interesting to see, assuming inflation does eventually get over above two percent, whether the FED will be so willing to tolerate that after all? Well, you do wonder, Peter, Right, is that potentially than the

Fed being irresponsible? Because right, thinkable is a funny word here, because Paul Kirkman said that, you know, the FED almost has to or any center bank almost has to commit to being irresponsible, And by irresponsible he means, you know, more willing to target inflation than a traditional center banker would have been. Okay, Peter, We're gonna change gears yet again because um Sunday night, we have some new economics

professors win the Nobel Prize. And you also, uh, I thought scared up an interesting angle about that and and sort of the work around auctions. How central uh of a contribution have they made to sort of what has unfolded in in auctions that we some we see in our daily lives and others that we we may not get to see as much. We don't necessarily see the auctions that are happening for for example, radio spectrum, but

they affect our data lives in a big way. Some interesting thoughts about the Nobel Prize winner in economics, That of course was Bloomberg Business Week Economics editor Peter Coy along with Bloomberg Business we editor Joel Weber. Check out Peter's full stories. You can find them on the Bloomberg

terminal and of course at Bloomberg dot com. You're listening to Bloomberg Business Week while on the subject of economics that may increasingly include a world where workers are not at the office and keeping track of them more on that with the CEO of Stoke Talent. That's coming up next. This is Bloomberg. This is Bloomberg Business Week with Carol Masser from Bloomberg Radio. Well. Bloomberg City Lab recently reported the pandemic has been a grand global experiment and the

costs and benefits of a remote workforce. But long before the coronavirus hit, many people worked from outside offices. We're talking a lot about remote working and remote workers because of COVID nine team. Shahara Rez is co founder and CEO of Stoke Talent and on demand management platform for companies to manage their on demand and non payroll workforce.

Do you joined Bloomberg's Paul Sweeney and me from Israel about the workforce trend that was truth be told already here wait before the panemic, were started saying this way towards for no work even in already there in the US without offices, which which sounds like a big number, and we saw the grand heading that way, um, and we're starting this is heading towards a place where most company will have remote workforce and a significant portion of

the workers as independent contractors within six to ten years. In fact, you're a labor statistics forecast by of U S workforce will be free lancers in independent contact UM. And then came the pandemic and kind of accelerated that what we talked to take five years into five months. And because everyone's now every more employee, everyone's working from home. Doesn't matter if you're sitting in an office in California, are sitting you know, in your home in Iowa. You

can do the same work. And so it opened a world of opportunities and we're seeing now an acceleration of what was bound to happen. We will turn an employment arrangement. Alright, So Shahar, with more and more company's employees working remotely, whether their employees or freelancers, my guess is that's kind

of creating new management challenges. From an HR perspective, What are some of the issues that you your giants are seeing and what are some of your solutions, UM, So I'll kind of distinguish between remote work, which is, you know, an employee that just doesn't come every day to the office.

I think the biggest challenge that we're saying is really with this the transition that organizations are having too a flexible employment arrangement where you have the workforce that's not really formal company employees, independent contractors, freelancers, gig workers, service providers. In fact, that is becoming the norm within organization and

again remote work has accelerated. The biggest challenge that we're seeing there is what we now call UM shadow way job UM, and we took the term shadowy jar kind of borrowed it from the term that was created in the mid two thousand in the world of what was called shadow I T and shadow I was calling during that time UM as a result of departments, teams and individuals with incorporates bypassed in formal I ke uh processes and policies and instructions if you will, and start buying

services and application outside I because they wanted to move faster. No results. It significant challenges as data leakage, performance issues, UM overspending inefficiencies in the organization, and we're saying something very similar happening now with what we call the shadowing jaw. Shadowy jar means that there are people that are doing work for the company but are not governed by any

process in the company. Most AGR organizations are UM governing if you will, M w two employees formal company employees, but with twenty of the workforce not really company employees, not really on the payroll. These freelancers, independent contractors, they like the government, these non employees, they don't have a single owner in the company. It's kind of falls between the HR team, the prosurement team, the finance team, the

legal team. There's a lot of different people that need to come into play, and none of them really own it, and so a lot of things are going wrong or potentially going wrong when when that is the case. But this is where you guys come in, right, because this is I mean, this is essentially what you do right. You're able to kind of track these remote workers correct.

So what we've built its stoke is really the ability for companies to have a single source of truth to extremeline the entire process from on boarding UM freelancers, independent contract or service providers, making sure they're signed the right legal docs, making sure that the right budgets are allocated, making sure payments are done correctly, and then off boarding

them when the time is right. We'll keeping all the back office UM breaks and balances, checks and balancers in place, because if that's not the case, what we're seeing happening more and more in companies. Why the way when we talk to companies, talk to the CFO or CEO is the most common responses. We don't really have contractors or freelancers.

And the reality is there's three U five X what do they think they have because it's not managed anywhere and the results are um A either over spin budget overspin um or which is a much more severe case, plenty of compliance issues. There's really three levels of compliance with independent contractors. One is legal compliance and they signed the right legal docs ind A no compete IP ownership.

We are seeing cases when no one signing the papers and then guess what he catches up to you later on when the company goes to a financing ground or an i P O, all of a sudden a freelancer stand up until they I never signed over I P should and you know I have a part in the in this company. UM. Data protection is a big one. UM. Sorry. One thing I wanted to ask you. I mean, you've held steen your positions at vm Ware, Hewlett Packard, You've been in the software in I related space for a

long time. What do you make of what we're hearing about Silicon Valley and you know you are hearing a lot of those big tech companies say you want to work from home for the rest of you know, your life. That's fine, you can do it forever. UM. It's a trend that you you know, what are you hearing from your colleagues in Silicon Valley about that this will really ultimately stick. UM. So, as I mentioned, I don't think this is new. I just think we're seeing an acceleration.

This trend started. I don't know if it's started in Silicon valid, but obviously it was popular in Silicon Value where people are working once or twice a week from home. UM. And we started seeing more and more super successful companies that are were built in the distributed manner. Companies like Hashi Corp, Elastic, WordPress and again weren't built that way, and over time more companies moved to that that operating

mall UM. I don't think it's going back to the way it plus, I think that companies need to realize this is the new normal full we disputed organizations and to put in the right processes to support that organization because it isn't the mental change. UM. A lot of us we're used to seeing people in the office, white boarding, brainstorming in person. A lot of that is not going to come back. It's gonna be once a quarter, once

a month. Maybe this means won't be together, but most of the time it is going to be a fully distributed organization. And I think it has dramatic implications, not on the workforce. I think the work will still get done. I think there's two areas that's going to be can change A how do companies for the first time in a while, we'll start measuring output. You know, in the software industry for years, companies that we're trying to measure

how do you measure engineering output? And there's no real answers for that, and so right now and people or you know what, how do you measure their productivity? That's a horror Rest co founder and CEO of Stoke Talent, he's talking about productivity. We've heard a lot about that from various leaders, including JP Morgan's Jamie Diamond. Some say it's taking a hit, others say it's doing just fine

as workers work from home. Well coming up. One trend we've noticed with all of us working from home, started drinking more. Some trends from millennials who are out to change the beverage world. That's next. This is Bloomberg. This is Bloomberg Business Week with GARYL. Masser from Bloomberg Radio. Well, it's the weekend. Time to kick back, maybe with a tall, cool one, and maybe even a cool game. We've got

two interviews on this in the next thirty minutes. First up, a collection of millennials thinking about the next generation of drinkers and the brands that will be in demand. Bloomberg's Paul Sweeney and I checked in with Amy Steadman, founder and CEO at future Proof Beatbox Beverages and heard about their strategy. But first up, we had to know how this relatively new brand got through the pandemic. When all

this started, we were nervous, just as everybody was. That our primary distribution is in channels such as grocery, liquor store and convenience stores. And what you did toe was all of the dollars being spends on alcohol shifting from restaurants and bars into those channels. And so we've actually been experience anything record sales months every month of the pandemic, and that's been able to, you know, fortunately turn it around and raise money for Small Business Relief Fund and

a c l U and other groups as well. So it's been the silver lining of all that so amy. When I walk into a liquor store these days, I'm just overwhelmed by the number of products, you know, really competing for shelf space. It's just so many new products. It's not just beer, wine and spirits. There's everything hard seltzer, and I guess that's kind of the u some of the newer products. How do you get mind share market share in such a crowded market. What's your marketing strategy?

Absolutely so, I mean, what you're seeing is the results of huge trans and consumer drinking. Right, Millennials are shifting away from traditional beer to wine and flavored items like Beatbox, and the bigger brands are scrambling trying to find things that are gonna work. But what they're missing is that key authenticity that millennials and gen z are also looking for. You know, the big brands will try and slap a new label on an outdated idea, trying to make it

cool to these demographics. But you know, with our brand, we sought to create the most authentic experience possible with you know, we use social media, brand ambassadors and other listening tools to stay extremely connected to our consumers, and I think that's really what's made us stand out and on all of those different new entrants like you've mentioned. Okay, one thing I want to ask you because your background

is really fascinating to me. Um. First of all, it's a woman who's got two male business partners and you know, creating a company, and I'm curious about that experience. I'm also experienced. You're a first generation US citizen that you know, you moved here from Syria when you were about ten years old, So I'm just curious about, you know, being an immigrant in this country creating a company and what

the experience has been for you. Yeah. So my parents had corporate jobs when we lived in the Middle Eave. My dad's from the UK and my mom's from Syria, and they actually quit their jobs when I was ten years old to pursue entrepreneurship in this country. And so we came over and I watched them grow their businesses

through high school and college. It was a vending machine business with those you know, bubbles and stuffed animals and things like that, So that was their business and then when it came time for me to go to business school and start my company, I was incredibly flattered that, you know, my business partners decided they were not going to start a next generation alcohol beverage company without including

a female founder and having diversity on their ownership. So I really appreciated them recruiting to me to join the team. And um, you know, certainly being a female founder in that alcohol beverage industry is had its rocky moments. I mean I'm often mistaken for, you know, a promotional model when I'm saying no, I'm actually the owner of the company. Um,

people you know have a reaction. But my reaction to that is, you know, the more that I can be on things like this and show up the panels and be mentors to other female entrepreneurs that you know, we could make a change in our generation and you know, the next group of female founders. And there have been many many new women's founders of alcohol beverages and alcohol

beverage companies recently. Um, you know, if I see that as a great change, and I hope that we can continue to be the change that we want to see in this industry and encourage more diversity of ownership as well. Well, it's super grateful to be an American citizen. Is a wonderful place to be. I know, we have our issues, but this isn't an incredible country. Beatbox Beverages is a product that we launched the first time back in two

thousand thirteen. We really found that it was resonating with millennials in terms of the eco friendly, portable, great flavors, and so we've been really growing with that brand. Uh this past year, our company is actually transitioned from Beatbox Beverages to future Proof brands, and we're piloting to new brands and fast growing categories and alcohol as well, corkless and alternative packaging, wines and brizzy in the Seltzer space. All Right, wait, bait, Okay, we're going way too fast.

You gotta go back to Shark Tank because I mean, we all know that brand. We well, I you know, every once in a while, I go down a rabbit hole and I watched a ball out, you know, one after another, because it's just fascinating to see to me, entrepreneurs you know, pitching their business to you know, this panel of individuals who've got money to spend and who

understand what it takes to make a good business. What was that experience like because you actually got Mark Cuban two I think pitching about a million dollars or so, absolutely, which was one of the biggest deals on the show of all time back then. But um, you know, we we started the company very bare bones. You know, we made it ourselves, distributed ourselves. We were doing you know, probably six to nine hours of in store samplings a weekend, and we would always get that common is you should

be on Shark Tank. You should be on Shark Think when people saw the product, Yes, Shark Tank definitely a good idea. That's Amy Steadman, founder in chief operating officer at future Proof Beatbox Beverages, with some advice for entrepreneurs, And I gotta say not too shabby too to have Mark Cuban backing you, all right, Still to come safe to say, Amy and her team had lots of decisions to make while building their business. Coming up former pro poker player Annie Duke on how to stack the deck

and make better choices. That's straight ahead on Bloomberg Business Week. This is Bloomberg. This is Bloomberg Business Week with Garrol Masser from Bloomberg Radio. So let's wrap up this week with Annie Duke. She holds a World Series of poker gold bracelet. She played the game for years, retired into after making over four million in tournament winnings. She's down inspirational speaker, author and putting her efforts to good causes,

including the Alliance for Decision Education. She's got a new book out this week, How to Decide, Simple Tools for making Better Choices. Bloombergs Paul Sweeney and I talked with her about making decisions, education and of course, of course the game. I was a graduate student at the University of Pennsylvania doing my page d work actually in cognitive science, and UM I was full. I was like contending a professor.

And right at the end of my five years there, as I was about to finish um and actually as I was going out for job interviews, I it got sick and I needed to take some time off, and I didn't I didn't quite know what to do with my as I was taking a year off and I really needed money. Um And and my brother Howard Letter had had already been playing poker for about ten years before then and was the one who actually suggested to

me that maybe I play. It wasn't totally out of the blue, because when I was in graduate school he would a chase and would bring me out to like Las Vegas on a vacation um and give me money to go play poker in some pointers. So I did know something about the game. But he's the one who got me into playing professionally. So all right, so you have that experience as a poker player, uh, success as a poker player. When you retired from the poker game, What did you do next? Why did you retire and

what were you looking to do? Yeah? So, actually it's not quite what did I do next, because it was what was I doing in parallel of myer? So I retired in two thousand twelve. Yeah to um uh it. The founder asked me to come speaks traders about how

poker might inform their decision making. And that was about eight years into my poker career, and it was the first time that I started thinking pretty explicitly about how my work in cognitive psychology could inform um poker thinking and vice versa, that that might help to really understand both the things that frustrate human decision making and the

things that might get might make it better. So that was in two thousands two really thinking about that conversation, and for the next ten years and I was doing talks and out um consulting and starting to help people think through how to become better decision makers, to improve their strategy around decision making. In two thousand and twelve, I retired from poker to do this full time and now I consult full time, I speak full time, and

I write full time. So let me just tell you this book is like the perfect timing because we could need some help. I think a lot of people could use some help in terms of making better decisions. Talk to us a little bit about the work you doing for the Alliance for Decision Education. Tell us about it and what it's it's setting out to. We just had a really smart conversation with Sly James, the former mayor of Kansas City, about what we need to do in

terms of education. But I love your your thoughts on it. Oh gosh, yeah, thank you so much for highlighting the alliance. So essentially, what what our mission is that the Alliance is to bring decision education into case of twelve education. So the way that we think about it is that you know, better decisions lead to better lives, which ultimately

lead to a better society. And as you were asking, you know, in terms of what's going on with decision making recently, I think that we can see that we lack decision education in K through twelve UM in our case through twelve system. So so I think sort of the way that I would put it is, we have this requirement for kids to learn trigonometry, which, like, if you're going to become an engineer, I suppose might be important,

and but you could take that in college. And yet we're not teaching people to simple things like statistics and probability or what's a habit or what would a good decision process look like, all things which we think would have a much deeper impact on their decisions they make. So, you know, we'd like to get more condom in there, you know, and less trigonometry in there. I would be thinking back to my high school days. That would be

a welcome change. I love trick, I really did h any So I'm thinking about your book again, how to decide simple tools from making better choices when I'm faced with the decision. UM, I think my probably my fallback positions. Just go with your gut, Like I don't even take out a piece of paper new pros and cons. I'm guessing that's not the optimal strategy. Um what should I

be thinking about? Yeah, so I think that this is exactly why we need decision education because this idea of going with your gut seems the whole kind of a special place like people think gut decision makers or somehow uh special decision makers, but it's actually much more that

they're random decision makers. So um, so that the issue is I'm not saying that your gut can't get you to a good place, it's that the requirements of a good decision process or that you actually think about what's the information that I need to know in order to inform this decision? What can I find out? What are

the different options I'm thinking about? And then you need to do some food future predicting that's somewhat explicit, which is you know, what are the ways I think this could turn out and how likely are those things to occur? And having gone through that, particularly if you can keep a record of it, it's really helpful because then after you sort of get the results of the decision that you make, you can actually look back and say, you know, did I have the right information? Was I thinking about

the future in the right way? And that allows you then to become a better decision maker going forward. You get to learn. But when your gut, you can't do that because it's essentially a black box by definition. It's

not something I can look at. The other probelem with that decision making is I can't teach it to somebody else, And particularly if you're in a business with a team, it's not very helpful as leadership to say I go with my gut, because that doesn't improve the quality of your team's decision making since they don't have your gut. You'd rather have a really good decision process that's going to improve the quality of the decisions throughout your organization.

So is it like a pro and calm list on steroids? Basically, well, it's got a little bit of an element of a pro and calm list, But I actually wish that people would kind of throw their pros and consists away because we're all very aware now of the influence of cognitive bias, right, I mean, Thinking Fast and Slow is not a bestseller

for nothing. Um And the problem with the pros and cons list is it's actually a decision tool that would amplify the cognitive bias because you're just kind of making this list of like what do I like about the decision? What don't I like about the decision? And there's there's no explicit sense of like how bad or the pros or the cons or which cons am I supposed to put on there, or which pros am I supposed to put on there? Or how likely are any of those

things to occur? And all of those things are things that you need in order to make a good decision. So basically what happens with pros and cons list is that you sort of already got an inkling of whether you'd like to make the decision or not, and then the pros and cons list just is a way for

you to express that preference that you have. So instead of doing pros and conslists, it would be better if you actually thought about what are the different outcomes that I think could occur, like the reasonable set of possibilities, and yet some of those will be good and some of those will be bad, But then you can think about how good are those things? How bad are those

things and how likely are those to occur? And that's information that doesn't exist in a pros and cons list, And then you can just compare the upside and the downside. And the other thing is that you can start to see the risk because with the pros and conslist, like what, I don't know if they've got more cons? Am I supposed to just say yes to it? What if the cons are like a hangnail, you know? But the pros?

You know, I don't know, Like I don't know how to compare that stuff unless I actually think about magnitude and probability. Hey, any how about the variable of time? Sometimes I have to make a snap decision and sometimes I can take your time, and sometimes you can maybe even make a decision in advance. How do you account

for that? Uh? Yeah? So time is actually really important, and it's a very important piece because when we think about gut decision making, often we're using our gut for decisions that we should actually be taking quite a bit of time on, and we'll use like a big analytic process for decisions that we should be taking no time on, like what should we order up the menu? We've all been around those people, right, you might be one that takes like fifteen minutes order off the menu. So um.

So there's a couple of things that tell us how much time we should take on a decision. One is that sometimes we just have a deadline. Right if you don't decide within the next week, the option is going to go away and you're not gonna have the opportunity anymore. And then obviously you just need to you need to make the decision with a time period. But the other way that we can think about like how much time we should take is just with two frameworks. One is

how quitable is the decision? That would be like the two way door type of decision that Jeff Bezos would talk about, Um can we reverse it? Um? And we really care about that because the more that you can reverse the decision if you don't like the outcome, the faster you can go because then you can just mitigate the downside. Um. The other thing is just what's the

impact of the decision. So if I'm thinking about what to order off a menu, and I'm sitting with someone who's taking fifteen minutes to do so, I can just say to them, hey, let's just say your meal was really terrible. Are you going to care in a month and their answer is going to be no, And I'm gonna be able to Can you just pick that and that will actually speed the decisions. So think about impact reality and that will get you to the right amount

of time. That's professional poker player, Annie. Do check out our book How to Decide Simple Tools for making better choices. And that wraps up the weekend edition of Bloomberg Business Week from Bloomberg Radio. Thanks so much for joining us. I'm Carol Master along with Bloomberg's Paul Sweeney. Be sure to tune into our daily radio show Monday through Friday, starting at two pm Wall Street Time. You can also check out our conversations. They're on our daily podcast feed.

Find that wherever you get your podcasts, and don't forget to The show is on YouTube. Just search Bloomberg Global News and be sure to check out our Bloomberg Business Week Extra podcast. This week. Someone who understands a fast food space. It's Cliff Hudson, former chairman and CEO of Oklahoma Basonic Drive In. He spent several decades at the company.

He's got a new book out, Master of None, how a jack of All trades can still reach the top Bloomberg Business Week of course, available on news stands now, on the Bloomberg Terminal, and online at bloomberg dot com. Stay safe, everyone, have a great weekend, and we'll see you next week. This is Bloomberg.