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All Right, as we mentioned, Tim and I are setting the stage at the top a lot coming out investors this week, and I mentioned Julian Emmanuel over at Evercore II calling this a moment of truth for the markets because you've got big tech earning some of those mags seven, You've got the trade negotiations like we just talked with Catherine, You've got the FOMC, the jobs report and earnings report.
It's a lot.
Tim, Let's ask Nancy Lazarrel about it. She's chief economist for Piper Sandler. She joins us from Aspen, which is the biggest element on your radar. This week. We opened our program talking about Okay, yes, the trade deals. Those are obviously very big. We have everything happening when it
comes to tariff deadlines. Later this week, We've got earnings out this week from some of the megacap tech players, and then of course the jobs are coming at us on Friday, not to mention fed share, J Powell coming at us on Wednesday. How are you making sense of it?
Well?
I think really the consumer spending data we're going to see for the month of June from an economic perspective, is going to be really important. Our best guess is that the consumer is going through a soft patch right now. We have already clearly seen that in the retail sales data. Within consumer spending, we're going to get more information on services. We heard last week from some of the service oriented consumer companies airlines, hotels, restaurants that consumer spending in the
service sector also is a little squishy. It's not just goods, it's also the service side. So consumer spending, how week will it be as we go into second quarter into the third quarter? Excuse me?
We are expecting a soft patch.
We think it will be on the softer side, reflecting in part demand was pulled forward in anticipation of these tariffs, and you have already seen price increases and that's also impacting consumer consumer spending.
How do you make sense of that, given what we heard from airlines over the last couple of weeks. Not every airline, of course, but I'm talking mainly of United and Delta, who said, you know, as we got a little clarity about what was happening with tariffs late June early July, we started to see a real big turnaround when it came to consumer spending. How do you gel those two things.
I think it really is a bifurcated consumer. One of these days, I look forward to not using that word anymore. We've talked about that for a couple of years now, but there is really a bifurcation. The higher end business oriented airlines are I'm not an airline analyst, but they
are being supported by the higher end and businesses. Whereas the airlines that reported last week, couple of them anyway, and again today some layoffs, those are more for the lower end consumer, and the lower end consumer is really getting squeezed from these terrafs. It is basically a regressive tax on the consumer. So the bifurcation companies that are geared toward businesses and the higher end consumer can plow through this. Those that are more tied to the lower
end consumer are struggling. The consumer really is looking at price points right now.
I want to get to what our Shawn Donnan wrote about on the Bloomberg Today and at Bloomberg dot Com, and that has to do Nancy with the damage to the global economy from American protectionism. He notes that it's becoming increasingly evident even if financial markets get somewhat excited as we see trade deals being done. He says it all amounts to another step change in the trade barrier that the President has erected around America, which is starting
to reshape trade and investment patterns worldwide. Not his opinion, but his reporting out that Shawn has done here at Bloomberg and Bloomberg Economics, saying the hit to the world economy will reach two trillion by the end of twenty twenty seven relative to its pre trade war path.
It's going to be a different global environment.
Yes, well, for sure, it's going to be a different global environment. But I think we have to look at the economy as three dimensional chess, not just as a flat as a flat board, no question, tearis our attacks. I'm definitely more for free trade, but I'm also for fair trade. Maybe we can shake one little positive out of this and get some fair trade i e. Incrementally sell more to Japan and Europe in particular. But to be sure, right now, our effective tariff rate that we're
calculating is about seventeen. Now it's down dramatically, but seventeen is the highest since since the nineteen thirties, and so to be sure, that is a headwind to global growth. But I think that is just one part of the puzzle. The second thing that's going on in the United States is the capital spending cycle, and the tax legislation or that was just passed actually in the one Big Beautiful bill indeed does very very very significant accelerated depreciation for
capital spending apex appreciation for eighty percent of capex. That is going to be a significant boost to cash flow, corporate cash flow.
We've already heard that.
Last week we had four companies AT and T, Verizon, T Mobile, and United Rental. I'll say this tax legislation is a support for their cash flow. So against I think we can't just look at one level. We have to look at what's going to happen to capital spending and capital spending. I call it the ugly duckling of economic data. It's underappreciated for what it does for growth. It creates productivity, profitability and lists potential GDP growth and
that eventually lists living standards. So quite frankly, I think that article is a little bit way too one sided, and you need to look at the bigger picture and near term again, this economic soft patch for sure, but you're already seeing signs the companies that I mentioned, you're seeing it in data where US capital spending is picking up, and that's going to come back and help not only productivity but the job cycle as we go through twenty
twenty six. So it's important to look at the bigger picture. And I didn't mention deregulation. I'll stop, but that's also another really important support for the US and therefore the global economy.
But is it okay?
And you know, one of the things I want to go back to is you say support for the labor market. We had Rob kaplan On, former president of the Dallas Fed, on Friday and he said, you talked repeatedly over the tight labor market and the impact of immigration perhaps on that and how that could then impact US growth.
So I just want to throw that out there.
But when you talk about capex and what it can do for growth, certainly great for company balance sheets, Does it help workers? Does it actually provide momentum throughout the economy.
Absolutely, Again, it's called a business cycle for a reason, and when businesses invest again, they improve their profitability through productivity. And if companies aren't making more money, if their cash flow is indeed going up, that is incentive to spend not only on capital spending, but eventually on jobs and in wages. And you see it, you see it historically
in in the data. Again, capital spending always grows faster than housing capital spending, accept potentially in recession, capital spending always grows faster than consumer spending. So it's really really underappreciated. Businesses create jobs and pay and pay weaight and pay wages. So near term, absolutely, I would argue we're in a soft patch. The unemployment rate is grinding higher the Although initial claims have come down a little bit, continuing claims
remain elevated. Companies, I'm not sure the labor market is tight. Continuing claims remain very elevated. Companies are reluctant to hire given the trade. Given the trade uncertainty. We think as we go into twenty twenty six, the improvement in corporate profits, which right now are sluggish but they'll improve into twenty twenty six, then leads to a stronger a stronger labor market.
So yes, there's nothing more beneficial for the consumer than stronger productivity growth a low inflationary environment, and that gives you stronger real income growth.
To what extent is that productivity growth, in your view, hampered or not by tariffs.
I don't think it really is hampered by tariffs per se, incrementally maybe from a higher cost of certain certain investments. As a result, we are seeing an increase in the price of certain capital goods. So at the margin that is a little bit of a nick. But this is this is a very significant full capex depreciation, which again
those four companies early on in this earning season. I can't wait to hear what happens over the next couple of weeks that I have seen significant savings in cash in cash flow, So we don't know yet the full quote unquote saving to companies from this a new depreciation schedule, and it could more than offset anything which I think
it does from a tariff from a tear perspective. So tariffs are a one time tax versus capital spending, has a very long tail and will help the economy at least through twenty six, not into twenty sex.
So Nancy, we've got a FED meeting, as you well know, FED decision on Wednesday. So you say we're in a bit of a soft patch right now, but you are looking for improvement in twenty twenty six, and you see profits leading to a stronger labor market. If we've already got stimulus coming as a result of some of the tax measures by the President's big beautiful bill, then does the FED really should they not do anything for maybe the rest of the year.
Because they don't need to.
They're stimulus already coming, and they've got to be careful about inflation.
Just got about forty seconds.
Yes, I would agree that the FED doesn't need the cut rates. Our guests that they probably do, according to my colleague Benson, at least once, but we don't really need more than that. They already cut rates one hundred basis points last fall and that's still working its way through into the economy. So good point. Combination of the incremental I don't want to call it physical stimulus. It's basically tax at tax and implicit tax cut for corporations,
and the regulation are not inflationary. They're actually disinflationary through improving productivity growth. But net no, we really don't need it, but we'll probably will probably to get at least one.
All right, great to get some time with you again, Nancy, Thank you so much. Have a good week, Nancy Lazar. She's chief economist over at Piper Sandler.
You're listening to the Bloomberg Business Weekdaily podcast. Catch us live weekday afternoons from two to five pm Eastern. Listen on Applecarplay and Android Auto with the Bloomberg Business app, or watch us live on YouTube.
The US and Chinese officials finished their first two days of talks aimed at extending their tariff truth beyond a mid August deadline and hashing out ways to maintain trade ties while safeguarding economic security. The agenda includes giving more time for high stakes negotiations to play out on issues ranging from US levies tied to fentanyl trafficking to Chinese purchases of sanctioned Russian and Iranian oil. Andrew Bishop is following this all He's Senior Partner Global Head of Policy
Research at Signam Global Advisors. He joins us from Washington, DC, Andrew, giving your view of what has happened over these first of two days of trade talks. Do you think that this tariff truths will be extended?
Oh, yes, very much so.
I think the tariff truth is absolutely going to be extended. But the main reason for that is not so much because I think there's great progress being made on the substance of these talks. Rather, I think President Trump essentially realized back in April May that high tariffs on China just don't work because the impact on the US economy is too great and China has.
Too much leverage in the form of its control over rare earths.
So as a consequence of that, I think the President is in very much de escalation mode and trying to buy time make sure that the US receives the rare earth that China has promised in Geneva and London. And therefore he's definitely interested in extending that pause.
So if China has, in the in the words of Donald Trump, maybe has the cards in this negotiation, in your words, has too much leverage in this negotiation, then what does the US have Aside from an economy that relies on goods from China.
The US really only has a terror freight, which is why I think the Chinese side is going to be bargaining hard for a reduction in tariffs as well as a reduction or at least a stabilization in export controls, in particular of semiconductors.
What's interesting in the latest recent.
Events of the past couple of weeks is that the Trump detmonstration has reversed some of its earlier export controls on VSH twenty chips, for example.
As I'm sure you're well aware, that was.
A view that we had at Signum that this would be part of the deal that they struck in London. The problem for the Trumpet demonstration is that that move is already getting enormous pushback.
Right So, while China is going to be.
Demanding more of that, more repeal of export controls, it's going to be hard for President Trump to agree to that without facing major backlash domestically. And that's why I think he'll start pivoting the conversation away towards tariff.
Relief, just not as emminently as this week.
I don't think who has more at stake here? We so often, Andrew talk about the relationship and the dependent relationship between the United States and China. But when you look at this relationship, does one of the countries have more at stake here?
So?
I think the answer to that is, and the reason why you get different answers right, is that China definitely has more to lose economically than the US does. The problem is the US has a lower political pain tolerance, and as consequence, though even though the US economy is far more resilient and can absorb these shocks from a political standpoint, you have a president and it would be the case with any other president that essentially faces a Taco situation as soon as they come under pressure.
So then talk to us.
Take us to China in terms of what is happening in their economy right now, and we know that you're right in terms of pain tall tolerance, that many much has been reported. I guess I should say in terms of the Chinese government that they'll do what they need to do right in terms of potentially inflicting pain economic pain on their citizens. But tell us about what is the truth or reality, at least as you know it to be the Chinese economy today.
So what's interesting is you see a lot of vulnerabilities in the Chinese economy. Youth unemployment is a major one, you know, sort of misallocated savings and low consumption is another, and of course problems and the major problems in the real estate market. But what's interesting is that a lot of those problems aren't directly related to President Trump's tariff threats or tariff enactments, if you will.
So there are two ways of looking at that.
You could say, any marginal worsening of the situation due to Trump makes the Chinese position even harder to sustain. But a different interpretation, which I would lean with, is that, you know, because China is aware that these are structural problems that it's on its way to at least, you know,
resolve or at least tackle on its own. President Trump really isn't the major agenda item on the table here, and he can be sort of kept at bay and handled almost like as a single singular issue in its own bucket, if you will.
We've spent a lot of time over the last few weeks and all over the last few months talking about rare earths talking about tariff rates. But one thing that hasn't necessarily come up a lot of late has been the fate of TikTok and how TikTok could or could not be used as a bargaining chip in these negotiations. What's your view?
So my view on that is.
My view on that is that you can have a TikTok deal any day, right as long as the US is willing to accept the situation where China continues to control the algorithm. So that could look at one that could look one of two ways. Either China controls the algorithm and there are essentially two tiktoks, a Chinese TikTok and an American TikTok, and the American TikTok is sort of fully US owned but it just doesn't have that
initial algorithm. Or you have a situation where the TikTok platform in the US still has the underlying algorithm, but there's an existing dependency on China. What I don't see is China agreeing to part ways with that algorithm. So a simpler, a simpler version of that is to say, China is not going to give away the real TikTok. So the question is whether the US wants to continue with the status quo or downgrade TikTok's quality.
If you like, Hey Andrew, something we talked about in the two o'clock hour about all of these trade agreements that.
The devil's in the details, right.
And it just feels like in many ways we're just getting kind of agreements to do something. Something like a US China trade deal is going to be a complicated one and lots and lots of pages and items to discuss. So I guess what my question is is we will probably not know the specific details for a while. So investors trading off of, I mean, what should they trade off of, what do they be looking for in terms of specifics when it comes to a US China trade deal and how long might that take?
And so I think one thing that they can trade on is direction of travel, right, So, very concretely, experts debate whether there's going to be a minor terror for Leaf tomorrow or in November or some time in between. But most experts at this stage agree that there is a floor under the relationship and that it's unlikely we're going to see TEFF increase, right, So one answer is things are probably going to get better, not worse, over the coming six months, different if you look over the two.
To five here horizon. But that's a separate question. So that's one answer.
The second answer would be any deal is likely to involve purchase commitments from China, right, so similar to the Phase one trade agreement that they struck back during President Trump's first term. China will probably promise to buy more American things items, including agricultural goods. Those targets are not likely to be as high as during the first agreement. They were unrealistic back then. But that's a second component. The third is again, oh sorry.
No offurtunately, we've got to wrap it and leave it here, which is a mega te Well.
Honey, back to talk about the third one. Okay, that's what we call a megates.
That was great though. We really appreciate Andrew Bishop.
He's Senior Partner, Global Head of Policy Research at Signum Global Advisors, joining us from DC.
This is the Bloomberg Business Week Daily Podcast. Listen live each weekday starting at two pm Eastern on Applecarplay and Android Auto with the Bloomberg Business app. You can also listen live on Amazon Alexa from our flagship New York station. Just say Alexa play Bloomberg eleven thirty Now to a.
Very serious global issue. We're going to start in the Middle East, where President Donald Trump said the US would work on a new effort to provide food aid to alleviate starvation and gaza, along with other governments and organizations, including the UK and the European Union. His comments from this morning from Scotland in a press conference with the UK Prime Minister Keir Starmer.
The United States will be helping with the food. You know, we have a lot of access to food. We got a lot of food ourselves, and we're going to bring it over there. We're also going to make sure that they don't have barriers stopping people. We're going to be getting some good, strong food. We can save a lot of people. I mean, some of those kids are that's real starvation stuff. I see it, and you can't fake that. So we're going to be even more involved.
That's President Trump earlier today from Scotland. We're going to head to tele Aviv. Now to Bloomberg News Israel Bureau Chief Ethan Bronner. Ethan, we've all seen the pictures by now of starving Palestinians, many of whom are children. You've wrote about this, and you wrote about this last week, and the back and forth, what the Israeli government has said is happening, what many in the worldwide community has said is happening. The World Health Organization said is happening.
In your view, what is going on.
Tim, I mean, you know, I wish I had the wisdom for a genuinely deep answer. I think there can be no question that people are going hungry in Gaza. I think that we are now beyond any discussion of that. The issue begins to get complicated when we're talking about famine or starvation and whose fault it is and how long it's been going on. And I have to tell you that as a reporter here who can't get into Gaza, I mean, the Israeli military and government have barred us
from going in. It's been a source of enormous frustration for the entire two years almost that this war has gone on, that you have international aid organizations talking about starvation and you have the Israeli military saying none of it. So I think that for a while it was exaggerated. It may still be exaggerated. But it is real, and even the Israelis have acknowledge it, and indeed, as you
just noted, so has President Trump. So a very difficult situation is underway where people don't have food to eat, just fifty miles from where I'm sitting Ethan.
So many ways to go here.
But one thing I want to say is you say, for the most part, everyone has agreed that there's no starvation, but Israeli Prime Minister Benjamin not Now who says that there's no starvation in Gaza, So.
Right, I said, I can think we can all agree there is hunger, right, I mean, these are these various technical definitions. He has said there's no starvation. He doesn't seem to be right. I think the next question is is they're famine. I'm not sure I know the different you know how to distinguish among these things, but clearly one as we go down the words, we get to a more difficult situation. There is no question there is hunger. Even the Israeli military, what's held a briefing for us
a few days ago, use the phrase food insecurity. When I pressed, the folks been the colonel at some length about it. So there's no doubt about that. But you know, and we see people, we see what they look like, and we hear people talking about having no food and being afraid of dying from it. So this is not a joke.
How do reports of the hunger happening there coincide with Israel blocking aid supplies for Gaza in early March, so at that.
Point, I mean, I'm not a government spokesman, as you know, but the Israeli argument at that time was that the Hamas was hoarding huge amounts of this food and that there was enough of it for a while, and that they were Israel was going to find a way to keep it out of the hands of Hamas for a bunch of reasons. Their main complaint was that Hamas was taking the food aid, feeding its own militants, keeping it from ordinary people, and then selling it on the market
so as to continue their war against Israel. That has been challenged in various ways. Some version of that seems to be true, and that's why Israel did it and then set up this rather inefficient organization to try to skirt Amas, and that has not gone well.
We have a viewer who has written in and said, well, I'm wondering why President Trump is not pushing for a permanent end to the Gazo war.
I guess if it was easy, it would be done.
You're hoping I can answer that question.
Look, I don't forgive you for giving you such a test, but I think it's been going on.
First look, I mean I think.
Look, I would say the following that for most people abroad, from most people anywhere, the idea that there's.
A war is terrible.
Wars are terrible, okay, but we do have a war underway between two forces. The Israel believes that if Hamas is not eliminated, that it will reconstitute itself and a reconstitute itself as a threat to Israel. I think the President Trump is somewhat sympathetic to that idea. Now, while they're trying to eliminate Hamas, if people are starving, if ordinary people have no food, this is a separate issue. So in theory, and again I'm not the President's spokesman.
In theory, if they could flood the area with food over the next weeks, then they could start their war up again. Because Hamas is, after all, holding fifty Israeli hostages and has said it will not step down from power or give up its arms, which from Israel's perspective, is a danger to Israel. So I think that the President is somewhat sympathetic to that reasoning. Whether that's appropriate reasoning, we can discuss at another time.
And we should point out that this week we have dozens of ministers that are gathering at the United Nations in a conference to really push for a two state solution between Israel and the Palestines. We should also point out, tim that the US and Israel have boycotted this event.
Ethan.
We've spoken to you constantly over the last twenty one months or so after October seventh, and one thing that you've shared with us throughout that time from Israel is the view of the Israeli public support of the war, support of Prime Minister Benjamin NETANYAHUO. You've written in the last couple of weeks about some weakening support within the government, which he still does control after walkouts, But what about
on the ground in Tel Aviv? And based on your reporting, is there still widespread support for this conflict?
I think it is weakening. I would say that the photos and the videos of starving people and especially starving children in recent days has taken a toll on the public support. In addition to a range of other things, dying soldiers, the sense that Israel is increasingly isolated internationally. They're increasing reports of Israelis being attacked on the street in Greece and in Austria and so on. So there is a growing fatigue with all that. And Hamas does
been destroyed. So I think there is We don't have polls yet from this week showing it, but there is. I hear it around dinner tables, I hear it from friends, I hear it from colleagues. There is a growing challenge to the legitimacy and the justice of this if with all these things happening, people are also starving and the hostages are not being freed. So yes, I can't tell you that there is a majority against the war because I don't know that, but my instinct is that it is dropping.
UMAs how powerful are they still?
You know? And I'm just thinking about the attacks and Iran, and we thought the proxies and we thought that.
There was progress on this front. What do we know?
Well, we know that they're able to recruit lots of young people to join their forces, it's not surprising given what's been going on for two years and longer in Gaza for ordinary people. So I think that there is some degree of strength. The problem is strength when you're a gorilla organization basically means survival and being able to poke the bear, which is Israel. So it still has that ability to do it, and nobody is able to
replace Hamas right now in Gaza. Israel's argument is that once it can really break the back of the organization properly, people will emerge who are willing to take up governing the place. We will see whether that's true or not. With reference to what you refer to a better two state solution, The argument there is that non Hamas Palestinians who are associated with the Fatal movement and with the
Palestinian authority could take over. The Israeli government's argument is that they are not sufficiently different from Hamas, They too teach their children to hate Israel. And the second argument they make is they will ultimately lose out to the more radical forces. We can't forward to let that state exist. So we're in a very difficult place.
It's an impossible question to answer, Ethan, but it's a question I think worth pondering if the situation that you laid out is indeed what comes to pass, And I guess I could say, if and when the hostages are released, then what well.
One of the problems with the question, Tim, is that everyone, many people believe that the hostages will never all be released, because it is the only currency that Hamas holds in order to hold Israel over any barrel of any kind. Now, what may happen is this government may decide that it's gotten all the hostages out through any deals it can, and it moves in fully militarily, and the remaining hostages
are either killed or rescued. And then once there are no more hostages than Israel might continue militarily even further, or with President Trump's encouragement and the world's anger, this government might return to negotiating with Hamas indirect negotiations in either Kata or Egypt as that have been happening, and some attempt to cut a deal, at least a partial deal. But you know, though, what is the future is a very legitimate question, and I don't have the answer.
Yeah, it's just amazing and just disturbing from so many different angles.
The situation.
Do you expect any Do you expect anything to come out of this meeting at the UN just real quickly.
No, I don't depends on by anything. There can't be anything definitive out of it. A state of Palestine will not exist as a result of this meeting. It maintains, It insists that the world would like that to be the solution, and at the moment there is not a majority in Israel that embraces that solution.
All right, going to leave it there, Ethan, thank you, Thank you as always. Ethan Brawner, Israel Bureau chief at Bloomberg News, joining us from Tel Aviv is on this Monday.
You're listening to the Bloomberg Business Weekdaily Podcast. Catch us live weekday afternoons from two to five pm Eastern. Listen on Apple CarPlay and Android Auto with the Bloomberg Business app, or watch us live on YouTube.
All right.
From stable coins and treasuries to a crypto treasury firm, that's where we go next.
And Ethereum Treasury Firm has agreed to go public in a blank check company merger backed by more than one and a half billion dollars of crypto and stock financing. It joins the rush of digital assets heading to public markets. We're talking about ether Machine. It's the expected surviving company of the merger, and it's set to be anchored by more than one hundred and sixty nine thousand ether from one of the co founders and a stock financing of
more than eight hundred million dollars. That's, according to a statement just last week, as much as one hundred and seventy million dollars of cash and the trust account of Dynamics Corp. The Spack merging with the Pool would also be included. We've got with us and Raca Bernatova, founder and CEO of Dynamics, joins us here in the Bloomberg
Interactive Brokers studio. I said a lot of words just now that might not be clear to everybody who doesn't follow this space inside and out what is going on with this SPEC.
So thank you for having me, Tim and Carol. Great to be here. We're very excited about the merger with the ether Machine. This is our actually second SPEC transaction in the past eighteen months or so. We're very excited about the transaction number one. Obviously, it's in a space that we see is a very high growth space over the next short, medium and long term in the ethereum space.
But ninety percent of stable coins are in the ethereum universe, and so we see actually the ether machine and being one of the large beneficiaries of the recent genius actors I just pointed out, just talked about number two. The team is an extremely experienced team. They've been running in the ethereum space for five ten years. Actually, they are going to be fully dedicated to the business and really
grow it into a large institutional company. So it is a business that should be public in the first place, which was really truly one of our objectives as a dynamics pack. And a third piece, as you just mentioned, you know, one of the founders is contributing a very large eth steak himself, which shows a high confidence and conviction into building you know, the biggest or if not
the biggest institutional player in the space. So very exciting, you know, we, obviously you mentioned the financing, are very excited about the financing package. This is the biggest financing that has happened in the space since twenty twenty one. Eight our million dollar pipe that's at ten dollars back by very large investors, electriccapital, blockchain, dot com.
You make money the ether machine, Yeah, so ultimately the company all of it.
Yes, So it is a very differentiated company in our view. It is not a treasury company. It's a company that is really using ether for multiple purposes, staking, restaking, and DeFi and so you have multiple ways to actually win and create yield for end investors. So we are energy and infrastructure investors, a dynamics team by training over the
past couple decades. And so the way we think about it, Carol is basically, you can invest in oil or you can invest in oil company it actually utilizes oil and create more value out of oil. So we see the ether machine in a similar manner. You can invest in ether or just the digital asset, or you can actually invest in the ether machine that's using the asset and generating yield on top of it.
How do you think the return of ether machine is connected to the price of ether? It so obviously like if you're an oil if you're going to get invest in an oil oil company or in actual oil, those two things are pretty closely correlated.
There will be probably a certain correlation team in terms of price, you know, going in multiple directions, what we believe just given the demand for ether and stable coins, you know, hopefully that's going to.
Be in a positive direction.
We are excited about the fact that obviously ethereum is one of the big beneficiaries of some of the commercial demand as well. You see large companies like black Rock, JP Morgan, you know, Deutsche Bank and others really starting to embrace the space, and so that should sort of
underpin the demand for this digital currency in particular. But there will be we assume some you know, sort of correlation, but again there will be extra value add benefit that the team is going to create as they actually fully utilize Ether for yield.
So you're crypto play or an energy play.
We our background is energy and infrastructure by training, and we really do see sort of the digital assets space skirl as the next frontier in uh, you know, next generation infrastructure. Obviously you are seeing financial infrastructure or correct correct, and so you know, a lot of the background that we have from traditional energy and infrastructure assets are actually translatable into the digital act economy as well. You know, when you think about.
The concept of.
Investing in energy infrastructure, you're applying it to either correct okay, okay, and so you.
Have a component of you need large scale capital in order to make these companies sustainable, long term businesses, similar to traditional energy infrastructure. You need technical expertise again similar to some of that energy traditional energy infrastructure, and you just need high scalability of the overall market and the industry, which again is a kind of a third underpinning factor in the space.
Over the last few weeks months, we've seen a real rise in treasury companies tied to different cryptocurrencies, mostly Bitcoin, but some Ether. I know that you said there is a distinction between Ether machine and other crypto treasury companies. But if somebody thinks about this in the context of Strategy formerly known as micro strategy and Michael Saylor, the guy who kind of began this all, what are the differences in similarities between the way that ether machine is set up.
I think that's a good comparison. By the way, tam with micro strategy, we are seeing the Ether machine hopefully being the pioneer of ether, similar to what happened with the Bitcoin and micro strategy.
MicroStrategy is not an energy company or an infrastructure company. They're a bitcoin company, that's.
Right, and bitcoin, you know, it's sort of interesting because one of the reasons why we feel that ether is a very interesting asset class it doesn't have the energy
intensity component similar to bitcoin. And if you really take a step back right and think about the energy infrastructure complex over the next five to ten years, there's going to be a high competing demand one from residential customers, second from you know, onshoing manufacturing industrials, third from the bitcoin space, and fourth from the data center and AI space. And Ether doesn't actually necessary phase you know, the same sort of challenges from an energy perspective as bitcoin does.
So there was another sort of a winning you know, or selling factor for us in terms of partnering with the Ether machine versus another cryptocurrency.
You know.
One of the things that we love looking at here at Bloomberg as you'll put in a ticker, and we look at the supply chain and understanding customers versus clients who will ultimately be your biggest clients you think, and really provide some growth going forward.
Yes, so both commercial customers.
So again some of the large institutions, which I think again Carol.
Is fin you're talking large financial.
Institution, Yes, And that's again one of the reasons why the timing from our perspective is is really interesting with the Genius Act coming to play and really energizing the space, and second actually stepping you know, some of the large commercial customers coming in.
But at the end of the day, there is going to.
Be a retail component and you know, when you visualize kind of five to ten years from now, it's going to be a really important piece of our sort of daily you know, sort of life on a personal basis.
Any customers you can share with us. At this point, just got about thirty seconds left.
I would say that, you know, the team again is very experienced. We have some really interesting access to large commercial customers. So I would say stay tuned exciting developments from Dynamics and the Ether Machine.
Pretty soon.
We'll see raybe in the next six months, we'll see okay, okay. Really fascinating and certainly part of our changing world, no doubt doubt about it.
Andrea and Raka Bernadtova, she.
Is founder a CEO of dynam I'm next joining us right here in our Bloomberg Interactive Broker studio.
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