Mnuchin Pitching $916B Relief Plan

dot com. You can also listen to our radio show at two pm Eastern on Bloomberg Radio and be sure to watch us too on YouTube by searching Bloomberg Global News. The two things that bother people they say, well, maybe we did this too quickly. They need to understand the speed is really a reflection of the extraordinary scientific advances that have been made that allowed us to do things in weeks two months that normally would have taken several years.

That was not compromising safety, nor was it compromising scientific integrity. The process that went into deciding the safety and efficacy was both independent and transparent. We need to make sure people on the stand that all right that of course you know that voice, Dry Faucci, Right, it's one of those few voices that everybody knows. Yeah, you don't even

need to everyone knows Vauci at this point exactly. Um, he was talking though at the third annual Bloomberg Health Summit, and of course addressing concerns that are real about people maybe not wanting to take the vaccine concerned about safety. Let's get into a discussion with Dr Seth Letterman back with US, co founder, CEO and chairman of the New York based specialty pharmaceutical company Tonics Pharmaceuticals. Set Back with Us. He is on the phone in New York City. Dr Letterman,

Nice to have you here with Tim and myself. Vaccine and what we've seen a lot of news coming down the UK starting there are still some concerns. How do you see it right now? Well, first, I agree with Dr Faucci that the progress UH on the the two or three leading vaccines has been remarkable. I mean, it is just awesome to be less than a year out from the first time this virus was recognized and have you know clinical trial data on you know, at least four vaccines. But I do think that we have to

temper our expectations. While the data are intriguing so far, there are really four things that haven't been shown. There has not been shown. There are questions about the duration of protection. There are questions about whether these vaccines will protect against death and really severe symptoms. There are questions about whether these vaccines will block forward transmission, and finally,

there are questions about safety. So while I share Dr Facy's enthusiasm, I think that we all have to remain cautiously optimistic and await more data. What are the questions about safety. It's not something that we've heard a lot about. Well, Uh,

safety you have to think of two different groups. Uh. You have to think about the older people in retirement communities, who represent one population at risk, and then think about younger people for example, you know, college studes, healthy young adults, you know, particularly those without presisting medical problems. So for the older people in retirement communities, any vaccine will have some effect on their health. So I think we're gonna have to look at a large number of people to

see how they react to this vaccine. Now, for the younger people, you know, let's call them college students with no pre existing conditions, they're really a pretty low risk of developing serious consequences anyway. So it's a lot of information is going to be needed before we can really recommend that would be beneficial to them, uh in terms

of their own personal health to get any vaccine. But we've got a lot more information, certainly yesterday from the FDA, and I know there's a big review going on tomorrow that will ultimately decide, I guess whether or not there's US approval and we can move ahead. I mean, my understanding is the vaccine that you tend to know the worst of it in terms of any kind of side

effects within the first month. Um. I wish that was the case, but you know, we're talking about you know, using these products potentially in hundreds of millions of Americans, let alone people all over the world, So I think that you need a larger samples. And by the way, you know, the kind of approval that they're getting now

is really you know, emergency use authorization. It's not full FDA approval, and the guidelines for full FDA approval really required that they're going to have to show protection you know, quite a bit longer period out from from vaccination than where they are now. Well, that's sort of that at this point, that's sort of a worry for later because the idea here is to get as many people as possible, especially those vulnerable people inoculated as soon as possible. Right,

That's that's correct. But but the question is will will these acts have to be administered repeatedly? Right? So, so would you take this Dr letterman Um, Well, that's an interesting question. First of all, I'm unlikely to be a candidate because they're being you know, essentially reserved for people at risk groups. And I think that what the pediatricians and other groups have done working with the CDC to work out in equitable and um efficient way to distribute

the first vaccines is great. So it's really a theoretical question. I you know, I wouldn't qualify. Although I'm a doctor, I'm not currently a front healthcare worker. You know, said let me just because we're running out of time. Unfortunately, got about forty five seconds here. You guys that are working on a vaccine right with a live COVID virus, Well, yes, well we're going on a live vaccine, but ours is

based at Tonics. Ours is based on a live viral vector and we're designing it so it provides longer duration of immunity. And you know, Mark is also working into live viral vector vaccine so it's a different approach, right, But I think ultimately COVID is going to become endemic, so we're gonna have to think about vaccinating people for the long term and even people who haven't been born yet. Yeah, it's I think it's definitely an upheaval when it comes

to how we treat this. UM. Dr Seth Letterman, thank you so much, co founder, chief executive officer Tonics Pharmaceuticals with us on the phone from New York City. I mean, you know what we hear, Tim, right, is that we expect we're going to need multiple vaccine. Even if we see with fiser you have to wait three weeks to get the second dose of that, right, So it's gonna take a laugh. Interesting thoughts for perspective. This is Bloomberg

Business Week with Carol Messer from Bloomberg Radio. Let's bring in Naomi Nicks. She is corporate Influence reporter at Bloomberg News. On the phone from Washington, d C. Sonami, we were expecting this, but now that we've got some of the headlines, Um, what jumps out at you? What do you think is

the most significant? What could this mean for Facebook? Well, it's interesting, So the Federal Trade Commission specifically highlighted Facebook's per which just of WhatsApp Instagram in in the lawsuits that it filed just moments ago. UM. And part of what it's calling for UM is a potential unwinding or dibecter of those companies by Facebook. That would be a significant alteration of Facebook's business model um and one of the growing parts of its company. UH. And so that's

really interesting. And what they're saying is, UM, you know that Facebook essentially looked around for for potential competitors rivals, uh and then just instead of competing against them, bought them up. Well, I mean, there's no question that that's what happened to Yeah, that's I mean, that's the way it goes. I guess the question is to what extent does the federal government do these states actually have a case here? It is that that is that is the question.

And one of the defenses that Facebook will likely say is that, for for instance, in the case of Instagram, that Instagram became Intagram because Facebook bought it, and that actually at the time Instagram wasn't as much of a competitor in the market sense, and that Facebook was the one to help it grow and become such a popular

I think I think that's a fair argument. I mean, Instagram was tiny, it had a staff that you could you could count on fingers and toes back then when Facebook brought it in a billion dollars and it was a huge acquisition back then. But I think a lot has changed since then. And I do think Facebook has a case that says, hey, Instagram is what it is because of our investment, right, And I want to just bring it like, is the consumer hurt in all of this? Naomi?

Doesn't that ultimately what um? Those bringing the case? UM, all of these regulators and state attorneys in the FTC, the lawyers for the FTC, don't they have to prove

that consumers were hurt in the process. Yes, And that's one of the tricky parts about some of these tech ant I trust cases because these UM, because these platforms are free UH, lawyers can't rely on the usual measure of harm UH that they would normally use, which is priced to establish that a company hurt competition by hurting consumers.

And so in this case they're going to have to be really specific in their market analysis and defining the market, in defining the consumer and in defining the harm which might use less traditional measures. I'm just gonna remind everybody Microsoft, right when all of this first came down, how many years of lawsuits went on and on and on. I mean, who knows how long this could ultimately tim take. And

and it's a it's a really good point. And I think people look back at what happened with Microsoft as creating this environment for all these startups that we're talking about right now when it comes to anti trust to actually succeed. And in the meantime, you have Microsoft turning into one of the most valuable companies in the world again, right exactly. I mean, Naomi, this is just the beginning of what's going to be probably a very long process. Just got about twenty seconds here. It will be a

very long past. And the key for Facebook will be how does it maintain its competitive rigger in the marketplace while fighting, uh, this this issue on the regulatory front. That is always something that analyst investors right jump on and be like they're distracted. It's not a great thing, right overhang, Yeah, And as Charlie said, Facebook stock down three So it's not like investors are that concerned now exactly, Um, Naomi,

thank you so much. Naomi Nick's corporate influence for Porter at Bloomberg News on the phone from Washington, d C. As a matter of fact, I was going to just take a quick check what is Facebook doing this year? They're up, So I mean, listen, we all understand kind of how this goes. Yeah, so we'll keep a watch on it, but definitely moving lower here a little bit. This is Bloomberg Business Week with Carol Messer from Bloomberg Radio.

They're listening to Bloomberg Business Week Carol Masser along with Tim Stanivic Bloomberg Quick Take, and um, listen, this is gonna be a great story, great conversation because we just got the headlines about the FTC suing Facebook for illegal monopolization, for illegal monopolization. Let's get that out. Um. So they are certainly on the radar. And we love our Boomberg team because they understand companies. They understand nuances to when

they do a deal or potentially what this could mean. Yeah, and this is a perfect time to get Kurt on the show because he writes about what's happen. His most recent Bloomberg Business Week story in Joel Weber also joining us live from Brooklyn right now, Hey Joel, Hello, and yeah, you couldn't have scripted this timing any better, but you know, yeah, had been so patient. He filed this story months ago and then we were like, yeah, well we're gonna do

it soon. No time like the present Kurt um So story. You know, we we often try and have what I considered like a strategic lens on our stories. And you know, at Facebook, um this this behemoth that has you know, basically made a series of acquisitions that is obviously uh capturing, has captured regulators attention, hence the news today. But one of these is What's App? Right, and What's App they've basically added to the report folio. It's huge internationally, far

bigger internationally than than here in the US. But the big question is has always remained sort of like, how could they go about monetizing this? And when they do monitor when Facebook does get around and monetizing things. You look at Instagram and it has just become a cash cow for for Facebook and it really relies on on advertising. But the question is has been sort of, you know, what's app is not Instagram, so how would you go about making money off of it? And that seems to

be the big priority now at Facebook. So so walk us through what their plan seems to be. Curt Yeah, to your point, it is not advertising in the way that we know from the News speed or for from Instagram. And part of the reason of that is because it's hard to get the same level of data in a private messaging app that they are able to get from those other services. So it's harder to do the targeted ads that we're used to. So in this case, what Facebook wants to do is really turn what'sapp into a

commerce and payments platform. And so imagine that you know, you're interacting with the business, perhaps in the way you do today. You might send them an email, you might actually pick up the phone and dial a number. They envisioned a future in which you're doing all of those interactions on WhatsApp, and you're using the service to maybe place in order make a payment, handle a customer service issue.

And if they are sitting at the middle of all of those interactions between businesses and consumers, they see a really big business opportunity there, especially in markets outside the US where people are already kind of doing this behavior. They just don't have the structure in place to actually capitalize on it. So Facebook, but What's App for close to twenty billion dollars just a few years ago back in Kurt, what's the time frame for when we're gonna

start seeing Facebook actually monetize this huge purchase. Well, this is something we've been talking about for years at this point, and when you pay nineteen billion dollars for a company, UH, you you have to answer those questions usually sooner rather than later. Facebook's abilities to continue to grow its ads business has bought it a lot more time, I think than many people thought they would have to make money

from What's App. But what we saw in is that they're really starting to kind of double down on this investment. They made a five point seven billion dollar investment in an Indian technology company called Geo Platforms. The whole idea there is that they're hoping that What's acting kind of partner with Geo on a lot of this commerce and

payment stuff. We saw them making the acquisition of more than a billion dollars just last week of a customer service UH software company, and so the fact that they're making these big strategic investments in these acquisitions right now is a signal to me that we're going to see this idea materialize in a more real way, probably sometime in the next six to twelve prot Kurt, Before this FTC moved, you mentioned that that Customer Service acquisition that

was the last kind of big story from Facebook. Um, that was the purchase of a company called Customer Uh. And as you write in the story, you know, that was met with basically crickets and kind of a shrug from everyone. But how could how could the customer acquisition and this this Nissan strategy, with what's happened, how could

that all sort of start to come together? Well, the idea of being that if you are again using what's up already to communicate with your family and friends, it makes sense that you might want to just kind of bring your business or retailer relationships, if you want to call them those that's kind of an optimistic word for Facebook. You have a relationship with these business businesses, but you might imagine if you bring all those into one app, right,

and let's pretend that you're a large scale retailer. You're fielding, you know, questions or complaints from people on Twitter and Instagram and WhatsApp and Facebook you kind of want to bring all of those into one place so that you

can manage them. That's what customer does. And so if Facebook is buying this with the idea that perhaps that they can make it easier for businesses to you know, message with people on one of their platforms, including WhatsApp, you know that they could make the whole Facebook ecosystem a lot more valuable to businesses around the world and to them, that's that's an incredibly important thing to not only grow you know, their ads business, but build out

that payment stuff that we're talking about. Okay, so these are all kind of nuts, nuts and bolts questions and blocking and tackling and all that stuff. But can we talk about the drama because you do have some some some additional drama about the when WhatsApp was acquired, the drama that unfolded between uh those founders in Zegerberg. That is an ongoing thing that we we love to report about. Sarah Friar's book No Filter about the Instagram saga was

Financial Times Business Book of the Year. Um So I just have endless appetite to learn more about the drama behind the scenes, and you know, basically inability to share power, what is what did you learn in the course of reporting this and what tech drama? Oh my god. I think that the very very simple way to summarize this is to say that, you know, Mark Zuckerberg acquired a company from two guys who had the exact opposite idea

of of what they wanted to build. Whereas Facebook was building this thing that you shared publicly and they counted your data and they showed you targeted ads. What that wanted everything to be incredibly private. It didn't want to read your messages. And most importantly, the founders said, we're never going to show you ads ever, that's a promise. Don't even worry about it. So how did the company that makes that promise then go sell itself to Facebook? Right?

That those two just do not align. And so really once they got in the door, we saw a few years after the acquisition was closed that that tension really start it to build. Where Mark Zuckerberg is saying, hey, we want you to start building an ADS business, that's what we do best, and these guys saying, hey, we promised,

are you We're never going to do that. We're not going to build what you want us to build, And and ultimately we saw both the founders leave in the late seventeen early eighteen UM and and it's just you know, anytime you bring together clashing cultures like that, you're gonna have a lot of a lot of issues. That's right. When there's ever a merger, we think about salesforce and slack like this is a question we asked, like, how is that integration going to work right? Because so often

they don't exactly right. We see it throughout history. Um, for those of you listening to New York d C in San Francisco watching a YouTube Bloomberg Business Week, Tim and I, we're gonna be back. If you're listening to Bloomberg one or six one in Boston, paste tape Business is coming up next or thanks to Kurt Wagner, tech reporter at Bloomberg News and to Jill Webber, editor Bloomberg Business Week. Find more Business Week stories on the Terminal

and at Bloomberg dot com. This is Bloomberg Business Week with Kirol Masser on Bloomberg Radio. So you're listening to Bloomberg rad bu Bloomberg Business Week Carol mass along with Tim Stanivik, a Bloomberg Quicktake and you're on air live on nine and noon nine and Noon, you talked about stimulus. Oh, it was the lead story for both of our both of our shows today. Yeah, I mean it's listen, we keep talking about this that until we find out what's

going to happen if we get it. I mean, this is kind of crucial for so many Americans and really I feel like for the US economy. Yeah, it's true. And you know, up until now, really I think that the story has been this disconnect between Main Street and Wall Street. But it does seem like, at least today, investors are taking a little bit of a pause because lawmakers certainly seem to be taking their time to get this stimulus done. They're taking a pause to So let's

get into it. Let's find out the latest. Eric Watson is all over this busy guy congressional reporter at Bloomberg News. He's with us on the phone from the nation's capital. So, Eric, where are we Because we just looked at Tim just sharing your latest story with me, um that both sides of the aisle are working on a compromise pandemic relief plan. So where are we in this process? Well, there are different paths going on. But one thing we've been keeping an eye on is this gang of know eight to

their coins seals are nine coalition. Uh. There were eight senators um from both parties as well as fifty Republicans of Democrats, and they had come up with an outline for a nine billion dollars stimulus. The details were lacking, and they released them along the way that outline of that but today, but they did not have the two key provisions, the lib liability protections for companies and state and local aid filled out. It just was kind of a placeholder there. So that was kind of a bad sign.

We're talking to Joe Mansion at West Virginia just now and he's saying, you know, by tonight, perhaps we'll have some resolution on this. Now. For professional leaders, they don't really like these side groups to form and sort of take manage into their owned hand. They like to seize back control and we're hearing really from from Republicans they would like just to go be more of a leader to leader discussion. I think that's where we'reheaded. Next week

is the deadline for government funding. A few more days, but I think that's when we'll see a deal come together and it probably won't be this gang which has at least quoted some ideas, but probably won't be able to close the deal. Well, now, it's not just liability protection four companies that's holding up this on Capitol Hill, right, it's also Republicans are sort of unwilling to budge when it comes to what they're saying, our bailouts of state

and local governments. What's the progress there? Yeah, well that was an interesting move from from Secretary Minution of the Treasury. He put forward a nine hundred sixteen billion dollar a plan that has a hundred and sixty billion dollars in state and local eight in it. And that apparently one into our sources had McConnell on board. Kevin McCarthy said he was on board that the top of public commuter in the House. This is really the first time that

they've gone on record supporting this this concept. Now, there were other parts of that proposal that were problematic for Democrats. To eliminate the three dollar per week a plus up for unemployment insurance that have been talked about. Democrats have been seeking six huntre dolls per week and uh and this just would zeal that out instead give a six hundred dollar payment uh to uh most Americans. Eric, I want to pause on that because that's a really big

deal for people who aren't working right now. Yeah, I mean, that's the thing, and it's not really target as Democrats are saying, Look, why are you giving payments to people who are employed? We saw in the spring a lot of people just pocketed that didn't even really spend it necessarily, while you know, short changing by four thousand dollars or so those who are unemployed because there's be four four months of benefits. Is it a clean measure or is

it getting bogged down on a lot of side issues. Well, I mean because of you might clean. I mean they're they're they're the outline of the biparson thing has as many different provisions as a small business aid three hundred billion dollars or so, a child care centers, broadband internet education. It's a grab bag of of measures, you know. But it is also tied to this government funding UH bill, giant one point four chillion dollar billis need to keep

the government open for us the year. Uh. You know, they're gonna extend that deirline for a week in December eighteens and that has been bogged down by a lot of small issues, indeed, but they're more likely to be resolved. If you remember, the President continues to push for a border wall. That's one of the signature issues there, as well as the money for immigration rates. So we're seeing those get worked out definitely on a separate track, but have to come together by the A team. That's what

I was wondering. I was wondering how much you know, kind of horse trading was going on here. Um, cut to the chase, Eric, do you think we're gonna get something before the end of the year, Because I just like Tim said, I mean, Americans who are you know, facing eviction? Um, you know, just have nowhere to go anymore. You know. I actually I am optimistic when I saw the monution offer and the Republicans come into the nine

hundred billion dollar ranged. Uh. You know, this is really within the scope that the by Parson group have been talking about, the level that that the Pelosi and Schumer the Tought Democrats had had endured. So on the numbers, they're really coming together. There there are policy differences, you know,

but I'm I'm more optimistic that I had been. I don't know about you Carol, But it doesn't it feel like there's this more sense of urgency at least with what we're hearing from lawmakers and Eric, is that what you're experiencing on Capitol Hill? Do they do? They seem like there is this sense of urgency to get something done A S A P. Well, I wouldn't say I should be but by next week because cars always operates on the they always say it doesn't operate on the clock,

operates on the calendar. And the fact that they need to go home for Christmas, they need to fund the government. That creates a deadline. And when you're trying to hurt cats, when you're trying to get all these people with very different viewpoints to finally this, you know, copy and do a deal, you need that kind of deadline. That's what's causing the urgency. Hey, just does it come down to also Erica a red blue thing that blue states are hurting a lot more than red and that's why we're

not seeing Republicans play ball as much. I mean, that's certainly part of it. I think, you know, you have a sense that that people can feel like blue states are mismanaged, that they are super generous to their state employees have huge pension unfund unfunda pensioned my abilities, and that the states will just take this money and pocket it. So there's a there's a feeling of resentment on that, on that, but you know, you know that's certainly a

part of the issue there. I mean, I have such a hard time hearing that because you know, I live in New York and I don't believe it. I don't believe it just when I hear lawmakers use that line of argument, I think about the federal tax contribution that large blues California, New York compared to the federal tax contributions that other states make and money that goes all around the country. So the argument rings hollow with me. Yeah, no, I'm you know, you're preaching to the choir. But it

does make go ahead, go ahead, Eric. I mean that even may more important to Illinois or are there are other governments that are more famous to unable to really be physically responsible, But you know, yeah, it's certainly that Democrats make that argument that allow of the blue states contribute more federal text as well. Listen, thank you for keeping us up to date, because we are seeing multiple stories, multiple headlines and watching this process, so hopefully we can

get something done here in crossed Yeah, exactly. Eric Watson, Congressional Report at Bloomberg New on the phone from Washington, d C. We'll see what maybe our our next guest has to say about it. Tom Plum watches the markets, really huns in on specific names. Specifically he is president, chief investment Officer plum Plum Phones, excuse me, and the plumb balanced vun top performer Incent Off of the past five years, returning on average annually. About let's bring Tom in.

He's on the phone in Madison, Wisconsin. Tom, nice to have you here with Tim and myself. How are you? How do you make sense? I don't know. I'm always curious what you think about some of these i PO issues in the IPO market that we've seen this year. Well, obviously it's been the I p O market has been

pretty exciting for the tech area. But you do I always wonder about the evaluations and then eventually you may have some overhead as some of the original families and some of the original investors basically start looking at selling some of their stock over the next few months. But uh, normally what we have been seeing is some real fast

bounce and then a little digestion after that. The valuations, of course, are just like we're seeing in all the tech area where they're they're high compared to historical numbers, but they certainly may not be high compared to what the expectations are. Tom. What what are clients coming to you with right now? People whose money you manage? What are the questions that they have and what are the

answers that you're giving them? Well, I think you know right now, a lot of people are concerned about whether or not the economy is going to advance next year. We hear a lot of people concerned even today. You get bounced around by are there going to be a type of a stimulus program or not? Is it going to be something that's going to affect all people? How

does it affect me? Um. We do expect the economy to recover next year and usually in a recover three time that it's pretty good for the stock market in general. But what we warned people is that you know, there may be a rising tide, but it doesn't rise all boats, because some areas of our economy are boats that have big holes in their holes. Yeah, it's we've definitely seen that play out. Um just you know, we continued to

have conversations over the past nine months. There are definitely winners and losers in this environment, even as we take out records on the major equity averages. So Tom, I'm curious in your fun which has done consistently so well, certainly as I mentioned, just even over the past five years. So where are you committing new money? Where? What do

you like in this environment? Well, we've continue to think that the pandemic really just accelerated some secular trends and that we're going to be in a digital economy for a long long time and it's changed how we do everything. So you know, we look at what if you know, we talk about uh greenhouse gases, and we talk about all the different things we need for energy efficiency, and that's going to be a, um a big important point for the new administration. And we look at who's going

to enable of that. And one of the companies that we look at as a company like Autodesk, which is the software company that provides all the architects and engineers with visualization and all the new digital tools that they need to address the current market Uh, they provide a lot of economies. We know that there's probably ten to thirty percent waste and materials on every new construction project because they over buy different things. With autodesks of virtualization, UM,

you can actually minimize that quite a bit. But there's also going to be an incredible amount of energy put to reducing energy footprint. There's some people to think that the buildings that we have are greater than the automobiles as far as causing greenhouse gases and CEO two emissions. So if they're thirty percent of the world's CEO two emissions, there's going to be a continuous effort to reduce that. And Auto Desk is a company that could do that.

We have seen you talked about secular trends just being accelerated and online payments, purchasing, direct delivery, the idea of using digital wallets. I know you argue that's something that's here to stay. How do you get exposure to that? Well, tim it's not just here to stay, but it's going to continue to grow and accelerate, and we've we definitely think that there's still a long path in front of papal and Ali Baba and Amazon and companies like that.

But but if you look at some real opportunities in Latin America, for example, Brazil as historically shown about an eighteen percent online growth in their UM purchasing and this year and accelerate. And then the leader in that industry, Marcado Libre, had over a seventy revenue growth in last quarter. So we see the company that can combine fintech with managed logistics, so that there basically a lot like an Amazon.

They delivered product in one to three days in a place like Brazil, and you have an incredible amount of underserved young people who are going to continue to use this. That is a seventy six billion dollar market cap company. I'm looking at the a d rs. It looks like the trade here and it's up a hundred and six and Tom, you see more growth here just quickly, Yes,

we do. I think it's a lot like saying Amazon ten years ago or five years ago, where people thought it was all behind them, when there's still an incredible road in front of them. Yeah, that's definitely maybe a CEO we have to reach out to find out with the up to Let's do it. Yeah, let's do it. Absolutely, this is why we love Tom. He just brings these companies. Uh, definitely things like Adobe that we know that's a top holding for them, but also um Orcado Libre. Uh interesting

to see what they're up to. Thanks so much for listening to Bloomberg Business Week. Download the podcast on iTunes, SoundCloud, or at Bloomberg dot com, and be sure to check out our daily radio show at two pm Eastern on Bloomberg Radio, and be sure to watch us to on YouTube by searching Bloomberg Global News