Tesla Poised for Expansion

dot com. If 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. You've got to say, well, I was incredibly happy to bring in a new year. It was hard not to be. As we sit at the top of the show, Tim kind of put on edge by the NonStop and I feel like dark virus headlines that we've been seeing over and over again, even though I think

so many Americans are numb to these numbers. Um, I think for a lot of us this holiday season they really head home. Yeah, I really, there was something, you know, you just I think being being beyond just tired about

the situation. You're right that we all either know someone and we're really just kind of feeling this personally I do want to put out there that global coronavirus infections climbed above eighty five million after daily cases in the US are to a record of nearly three hundred thousand following the New Year holiday. So just some numbers to

set the tone. Let's get our daily check on COVID nineteen doctors of our Chowdry, Senior VP in chief Information officer at Seattle Children's Hospital, joining us on the phone in Seattle. Dr Chowdery, nice to have you here with Tim and myself. It does feel like once again COVID is again out of control. How do you see it the afternoon? And thank you for having me on the show. Yeah,

I mean it. Certainly we've seen an uptake in COVID spikes, but certainly in the state of Washington we have had a good handle on the actions that we've been taking in terms of a healthcare system, in terms of protecting the public. So I think we're coping well in Washington. Stay with it. I mean, you were so early to the pandemic, the earliest cases were in Washington, and absolutely and so it taught us a lot, you know, setting up emergency operations centers, me in our health care system

and keeping track of this on a daily basis. Shutting down elective surgeries has all helped to bring us back on track. Certainly for pediatrics, we've seen less hospitalization. Where do you think we are now as a country versus where we were back in February, March, April, May are we are? We were in a worse place now. I think we've learned a lot, but I think we have

a long way to go. I think there's a lot of logistical things that we need to do in terms of vaccine dissemination and tracking people and continuing to follow the steps that we need to do in terms of social distancing, masking, etcetera. I don't think we're through the worst of it. I think we're It's sort of that curve of we're reaching that peak and at some point we'll see that better situation. But I think we still have more work to do. Yeah, it certainly feels that way.

Dr Charry. Technology Man, we've seen kind of the healthcare world um embrace telemedicine and really the use of technology increasingly. I just was kind of kidding with somebody this morning. I have more medical apps on my phone than I've ever had before, and that's what I'm using to check in and do things. Uh, it's really moved forward in a big way. First of all, what I want to ask you is, how could we use technology right now in a better way to get the vaccine out to

more people? Maybe to help in the distribution of this vaccine. I think there's going to have to be more centralization of how you track the vaccine. I mean, at present, we're still handing out, you know, little pieces of paper to say you've been vaccinated. I think at the state level that needs to be more coordination in terms of is there going to be a standardized app. Certainly in our health system, we're trying to track that with our

own electronic health record systems. But you know, that's another national sort of situation. Why do you think we've seen so many hiccups in the last couple of weeks when it comes to vaccine distribution? So many people have so many questions, When am I going to be able to get this vaccine? Who do I even call to get this vaccine? There's no clarity, and I know that varies by state, but in general in the United States, why

has it been such a bumpy road? I just think it's it's something that we haven't prepared well for, right, I mean, it's it's that logistical nightmare of how do you get everybody vaccinated in the hundreds of millions of people we had time to compare. That's what's frustrating, I think to a lot of Americans. Yeah, and I think it's not been It's been disjointed, hasn't it in terms of every state has had a different strategy in a different plan, and information technology was probably going to be

the way to pull all of this together. But then what you don't want is the situation you're describing. You know, I now have to log into fire applications to find out what's happening. And then there's also the equity issue in the country, right, because not everybody has access to the internet or a smartphone or a laptop, So how would we cater for those patients that don't have those

those things available? Is there a conversation that you think we need to be having with the Trump administration and the folks in Washington so that we can all of a sudden make this work better and and work out the logistical and distribution problems that we're not having that we need to well, I think my hope is at a state level we are having those conversations. Certainly, that

would be my hope. If that's actually happening practically, in practical terms, I wouldn't be aware of that, but I think that's what you need to do, is you need to have a standardized approach, and then that approach is

then passed down from the government to the various states. Certainly, you know, I'm I'm from the UK originally, and the UK health system has had a top down, centralized government approach to how a vaccine would be disseminated, and then different health systems have been told this is what's going to happen, and maybe we need more of that. Dr Chawdrey, Carol and I were talking about children and the vaccine.

When it comes to children. What is the latest research that you're seeing about when we can expect a definitive answer as to when children can or cannot actually get vaccinated. Well, at present, as you know, it's not a proof for anybody in the sixteen Certainly people are working on when that will happen. But you know, I'm in technology, not specifically on the clinical side, so I don't have a current timeline as to when a vaccine will be approved for the kids, but it is. You know, it's just

a reminder that we're still learning. There's still things that we have to learn about, uh, the COVID nineteen vaccines that are that are out there currently. It's just a reminder that we we still don't know everything, and especially when it comes to a younger population, which I think everyone would say, you know, it's so key to getting those schools back open. I mean, I wonder how you look at that situation. Um, you know, you obviously focus

on technology when it plays into the medical world. Technology has been crucial, certainly for schooling this time around, but there's nothing like kids being back in classrooms. Yeah, I think kids do need that personal interaction that helps develop them for the future. And certainly even even at adult level, we're seeing that disjoint between virtual working versus face to face communications. So I think there's definitely an impact, but

there's still a lot to learn. And you were also assuming that of the population will actually take this vaccine. Do you think do you think that there's going to be a significant I mean, I'm even hearing this among healthcare workers who are not comfortable, doctors who are not comfortable taking it. How do you see it? What are you hearing among your community? Well, if you if you look at the data for the state of Washington for flu vaccination, only about fifty of the people every season

take the flu vaccination. So we were applying that same statistic to it, which is an unknown vaccine that people don't necessarily trust. And I don't even think we're going to reach Yeah, I mean I I hope we don't

see that that type those numbers. I think the other side of that is that we could see you know, I think people are more concerned and a lot of people are more concerned about the effects of COVID than they are about the effects of the flu, despite what we heard from the President verily very early on in

this pandemic. Um Dr Chargery, I want to talk a little bit about technology in the way that you've used technology to transform the patient experience at the hospital, especially with with kids, because when kids are in the hospital, and when anyone's in the hospital, they need to be around people who love them and people who support them. Um, what changes have you had to make to visitation in the hospital and how have you used technology to help

bridge some of those divides. So, certainly there's been an acceleration to digital transformation throughout healthcare. Because of the pandemic, we've we've had to restrict the number of visitors by bedside to one parent, and we've deployed iPads at the bedside so that children can talk to their caregivers remotely. So there's been a massive influx of We weren't doing a lot of telehealth, but we really have spiked in

that telehealth space. And at the same time, we've we've made sure that the employees, not all employees, need to come in to work. So we've gone from almost zero people working from home to over four thousand people working from home now and we've done that on a hyper converged infrastructure with new Tanics with what I'm sorry say

that again. So the technology we've used as new Tanics hyper converged infrastructure to allow all of this remote working and then enable telehealth and telemedicine with the hardware at the bedside of these iPads available to kids. That's really access. Yeah, that's pretty that's pretty significant. Um. Yeah, it's just you know, interesting to se see how you know, as they say, stress and strain often leads to disruption, and we certainly were seeing it playing out here. Doctors a far chowdery.

Thank you so much, appreciate it. Senior VP, Chief Information Officer at Seattle Children's Hospital on the phone from Seattle. This is Bloomberg Business Week with Carol Messer from Bloomberg Radio. Well, it's a New Year's tradition when we check in with Hindsight Capital. That is the mythical hedge fund is only John Author, senior editor for Bloomberg Markets and Bloomberg Opinion calumnists can do. John is also author of The Fearful

Rise of Markets, amongst some other books. He joins us on the phone in New York City along with Bloomberg Business Week editor Joel Weber with us as well on the phone in Brooklyn. Hindsight Capital. I love this. It's the hedge fund that just gets it right. All my money. Oh that it were true, Joel, you brought this, You brought the store our attention. We love this story. Yeah, it's a It's an annual occurrence of John's and one that you know, we're just doing a modest adaptation for

this forthcoming issue. Of the magazine. But but John, I wanted to ask you, like, where did you originally get the idea for the Conceit? Okay, the original idea was way back in two thousand and eight, the you know, the Great Crisis year, and I started getting really obnoxious emails come December from people claiming that they'd actually seen this coming and that they were making huge amounts of money. Uh So I then, um, so a lot of which

I considered to be you know, blatant tin site. So then just tried tried with the next size, just with a Bloomberg terminal, seeing how you could have made money in two thousand and eight, almost all of which involved, you know, betting shorts on stuff. In two thousand and eight, there were there were very few things that actually made you any significant amount of money. Uh And yes, people

loved it, three or four people. I was working for the Financial Times then, but even Financial Times readers were in several cases dumb enough to write me letters asking for fran Hindsight capital address, complaining bitterly that they weren't in the Bloomberg term and also was I sure these guys were legits? Um this is one of the few years I haven't had anything like that, so I've generally felt the need to spoil the joke by mentioning up

top that it was imaginary. Now that I've grasped that people didn't realize that there was such a thing as a fund that could foresee the future and would make nothing but trades that more than double their money every year. So there we go, your own h G Wells, I thinking, were the world hinds capital? Well, so John, we're let's start in Rio where you decided to base Hindsight capital this year. Why Rio Rio is because the Brazilian rail was by far the weakest currency of the year, and

money illusion is a wonderful thing. If you're the weak of the currency in which you're investing, the better it will appear you have done. So the dollar actually had quite a poor year. The dollar flatter's quite a lot of returns, but the real dropped by more than twenty percent against the against the dollars, so you could automatically juice up your returns by more than twenty percents just

by doing that. Um So a number of if you if you invested in the Fang stocks, which we're going to come to later, the big Internet platform stocks like Netflix and Google. You almost exactly doubled your money last year in dollars, and you made sending a hundred and forty percent in Yale's first of all go to Rio. Also because a great idea to shelter last year in

in Rio. He moved the office to somewhere above with a view over eper deeper, name of beach and totally double all these trades that are going to double or triple your money and enjoy yourself for a year. Totally, dobously, quite sensible thing to do. Well, speaking about lockdown lifestyle, hindsight was all in on that one. Yes, I mean again, was it that difficult to see if you knew that a pandemic was coming? You know it really wasn't. So there are a number of ways to bet on it.

One of the one of the best ones was to invest in the internet retailers, not just Amazon. There were things like It actually did better than Amazon in sensic terms, and shorts the really good ones to bet against because a lot of a lot of the traditional retailers were already in bankruptcy. You're very weak at the beginning of the year, but you could bet on real estate investment trusts holding retail regional malls, the the guys who hold the real estate for these stores once they go bust.

And if you put those two trades together, you shorted, um, you shorted retail malls and stashed all your money into internet retailers. You tripled your money, Which isn't bad in one year or all the other one. Yes, So, John, I just wanted to ask about, you know, the other phenomenon which I do feel perhaps a lot of investors did take advantage of. Was this ability to know that, you know, when in crisis, central banks are going to print a lot of money, slash rates for money. What

was the best way to take advantage of that? There were well, there were many, Um. I think one of the easiest ones was too bet on a housing market boom based on the the the cheaper mortgages that would come through. So you bet on lumber futures, which is where a housing rebuilding boom will show up first. Uh. And you bet against mortgage rates, which which finance mortgages, which obviously make very little money. Indeed, when rates go down, to go down to zilch and that again roughly tripled

your money. Or you could just go for whatever there is the most duration, like people would uh invest in whatever was most interest rate sensitive, which means the longest duration possible, the longest into the future possible. So Austria issued three years ago a century bond. You don't get your money back until the seventeen and if you put money into that, you lent to Austria, not the strongest governments in Europe. Uh, and you've made something like seventy

We don't have a ton of time left. And I just wanted to ask, you've been doing this for a dozen years at this point, Um, what are the lessons we can glean from from doing this at the end of every year? Like, what is the big takeaway for readers and listeners? You just people just don't know what's going to work. People don't know what's going to work.

I think two things. One is when you see what things like what was it is possible, you should just bear in mind that, uh, these are what these are what would have worked, and often by definition they surprised people. So always cover your backside, never expect to actually do as well as hindsight capital. The other one I would say is that it's not a fair benchmark for anybody. We all of us have to cover the risk that

we might just be wrong. The other thing is, though all in all seriousness, have to have some confidence in your convictions. It will take it sometimes, it takes a while, but if you just really think through the macro logic, there's a there's a yeah, there's a pandemic coming. Asia will deal with it better, Europe won't. H and central banks or Princess a response most of these things, roughly speaking,

you could have got. You actually didn't need a ton of hindsight this year, like you could figure it out kind of how this was going to play out. So so score for this one. But listen, who knows about one will bring. But we'll look forward to what hindsight capital will be up too in the new year. John Authors, Senior editor at Bloomberg Markets Bloomberg Opinion columnists, took him out on Twitter at John Author's also at Bloomberg dot com.

Jill Webber, Editor Bloomberg Business Week on the remote access from Brooklyn, This is Bloomberg Business Week with Carol Messer from Bloomberg Radio. Once again, shares of Tesla bucking the overall market sell off stock was up as much as five and a half percent today On news at Tesla, Uh, coming close to meeting it's five hundred thousand vehicle deliveries goal for twenties. So let's get to the person who knows all things Tesla and Elon Musk. Bloomberg Technology reporter

Dana Hall are joining us on the phone from San Francisco. Danna, thanks for your patients as we were dealing with some live breaking news. So Tesla, man it is up again, starting off the new year on a strong note. Tell us about the vehicle deliveries goal um and what it really meant for the company. Sure, so, Elon Musk had set a goal of delivering a five hundred thousand cars, and then when the pandemic hit, people really questioned whether that was doable. Uh, then it seems like they would.

They were going to meet it, and on Saturday Tesla released the numbers. They were just a hair short, like fifty cars. So basically the market is saying they met it. I mean, you can quibble with whether they really met it or not, but you know, this is pretty extraordinary for giving the pandemic and given the fact that many consumers are kind of holding onto whatever shavings they have, and it just sort of bodes well for the new year.

It kind of sets them up. Now everyone is wondering what kind of guidance they're going to give for total deliveries, and we should learn more about that when Tesla reports earnings later this month, right, So now it's all about the guidance, right then, I mean, what are what are people looking for in terms of numbers? Do you think I mean on the last on a Q three or you call elan sort of hedge, but someone said do you think you could deliver eight hundred thousand? And Ellen said, well,

you're not far off. So people are thinking like at least seven fifty, maybe eight fifty. You know, all of depends on China um and in the model. Why but you remember, you know, this is also the year that Tesla is building new factories in Berlin and Austin, so they will have more capacity. And I think, you know, one of the things that you're seeing some of the bears on Twitter I mentioned is well, of course they're

delivering more cars now they have more factories. So you know, how is you know, are they really still growing or is it just that they now have more capacity. But um, you know, it's just been an extraordinary year for the company and they're heading into one and a very strong position. Yeah, totally. So what are your expectations that you know, what might be some of the main stories for Tesla, Because I do wonder, Dana, and you know this company, you know

better than most. I do feel like Elon Musk is someone who can juggle a lot. But you are building, you know, some massive facilities here in the US or more massive facilities also in Berlin, and at the same time, you've got to make sure that output is kept up, and at the same time you're facing you know, greater competition in the Chinese market, which is so important to your future. Like how do you juggle all that? So I just wonder what you're thinking might be kind of

some of the big themes for Tesla this year. Yeah, I mean, I think the big theme for the year is just sort of scaling operations globally and relying more on the kind of bench of talent that he has a Tesla and other executives. It will be interesting to

see where Ellen spends his time. I mean, he told Wall Street Journal right before the holidays that he has moved to Texas, where he's focusing both on the Giga factory in Austin, but also, you know, SpaceX has huge projects underway in terms of building another rocket called Starship UM, and so he's going to be spending a lot of

his time in Texas. Uh. You know, I think in terms of products, the next big things for Tesla are the rollout of UM, the technology that they call full stuff driving at that regulators haven't fully approved yet UM and the cyber truck. I mean, you know, this cyber truck is apparently coming later this year and the fanboys are very eager for any details on that UM. And then I think it'll be interesting to see what other

markets Tesla enters. I mean, obviously, China is the world's largest auto market, and that's going to be critically important. But you know, we've heard a lot of noise about Tesla entering India and Israel and potentially South America, and so if you look at the global map, there are a lot of markets where Tesla doesn't have any operations. So how are they going to grow in terms of

just entering new countries? Yeah, And I want I wonder too, just about in terms of keeping up this momentum here, because for so many years DNA it was just this, it was this supply problem. Right. The interest was there, the demand was there, but the supply wasn't necessarily there. So how do they keep growing that? How do they keep growing these numbers to satisfy investors who have sent the stock higher by what? As you note in your article, Yeah,

it's pretty it's pretty unbelievable. I mean, so that's so that's the fundamental question, right, Like for so for years, you know, Musk said that the problem was production. We're in production. How you know we're having all these issues. They struggled to ramp up them on all three then they but then basically they figured it out. And now they've introduced the model why and as far as I could tell, the model why, you know, the production ramp

has been okay. I mean every you know, there's a lot of stuff on Twitter about you know, rubes falling off and these panel gaps and what. You know, you don't want to hear that when you're getting a car. But but fundamentally like it, you know, it's they seem to have gotten the production strained out. So then the question was like well, what really is the demand for this car? And in a pandemic, are people really going

to be buying new cars? And it sounds like the truth is that actually, in a pandemic, people are more inclined to buy five cars because they're worried about taking public transportation. And you know, I just can't hammer enough. Climate change is so real to so many people now.

I mean, the entire West Coast was on fire all summer, and so you have people that are saying, you know, my next car is going to be an electric and um, you know, Tesla will Tesla continues to try to drop the price as they you know, improve their manufacturing and drive down the back praised that the car will become more affordable to more people. Um, you know, people always ask me why don't I drive a Tesla And the truth is that I don't drive very much because I

usually take transportation. But I'll feel like I've been working from home since March, so don't I'm not in the market to buy a new car. But um, you know, you're seeing more and more people buy Tesla's outside of their home state of California. You saw a lot of people take delivery in the last quarters of the year. And then remember too that there's this army of retail investors who have gotten grown wealth by investing in the stock and now they can afford the car where maybe previous.

It's a good point. Yeah, listen, we as a family, we think the next car, we want it to be an evy or you know something that isn't you know, an alternative vehicle. But I guess evs are all the only traice. You don't can do hydrogen cells yet that's not there. All right, Danna always um a great catch up with you, Danna Hall. She's technology put at Bloomberg News on the phone from San Francisco. As we mentioned, uh Tesla shares up about three and a half percent

as we speak. Journal. Yeah, but you let me drive. No, no, no no, honey, please, I'll do the right drivel. I want to drive. Just drive. It's good question trying. This is the drive to the globe. Give me thanks, we'll try us down on Bloomberg Radio. All right, first trading day one. We're just a few minutes away, about ten minutes away from that closing bell. Time for the drive to the close and back with us. As Aaron Kennon, co founder and chief executive officer, Clear Harbor Asset Management

about nine million dollars in assets under management. Errands on the phone from Stanford, Connecticut, Aaron, Happy New Year. How are you just fine? Carol? Happy New Year to you. Into Tim? Well, thank you, thank you. Well we're doing okay. I think like the rest of us is kind of watching some of those virus headlines, trying to make sense of it and what it means kind of for the next couple of months in terms of everybody getting safe

and vaccinated and then kind of our world reopening. How do you see it, how do you factor it in? What kind of visibility do you feel like you really have right now? Well, I think you know, as we approached today, UM, some new news over the weekend and and some sort of evolving news, and COVID vaccine rollout is certainly um one of them. It's it's of concern that is the speed at which we are rolling it

up both here and frankly around the world. And we have the Georgia runoff, which is another significant variable which only a few weeks ago seemed to be tilting towards the GOP and now seems to be tilting the other way, which has huge consequences for stimulus and the overall balance of power and um and I think the third variable that's going on markets is probably been an evolution over the last week or so, is this notion that the transition of power may may in fact be a bit

more rocky between now and inauguration day. So quite disconcerting. Wow, Well, let's talk about Georgia because that's happening tomorrow. If Democrats win, What do markets do? Well? I think that different underlying components of the market will do different things, right, so the FED is going to keep their foot on the gas pedals. So this sort of idea that we see massive fiscal stimulus or that we see a massive infrastructure program tim, I don't think it necessarily means that we

see higher rates, so um um. With that said, I think there'd be some concern around on the regulatory side of the docket, so you would probably see a different sort of shift in the paradigm around sort of sector rotation um and uh and And frankly, I think we have to also keep an objective eye on what what does a a A A move in Georgia by the Democrats of victory by those two uh, and Georgia mean, Um,

the Senate will still be very much balanced. It will just be things slightly and there are some you know, conservative or moderately conservative Democrats that can still certainly keep things towards the center. Well, that's you know, I think worth exploring a little bit deeper airing, because I think we do need to understand what the outcomes mean really when it comes to maybe new legislation or new regulations.

I mean safe to say at least the first six months, if not longer, of a Biden administration is going to be focused on doing everything in anything to get the labor market back to as close to normal as possible and the economy. Isn't it safe to say that we can make that assumption? I think so absolutely, and in fact that those are the trends that we've seen over the last few weeks and a few months. We've gone

from negative growth towards two positive growth. And I think two thousand and twenty will probably end up being a minus called three and a percent GDP growth here, and if all goes as planned, I think most estimates are calling for something like four percent growth. So uh, some things will of course be out of the control of Congress, which is, you know, will will another strain of covid um prove less efficacious on the vaccine front. It doesn't

seem like that's the case. There was concerned this morning that a strain out of South Africa was in fact potentially not uh covered by the vaccine. But I've read some expert opinions that that's not in fact the case. But we will see many speed bumps along the road here. Yeah, I want to go back to what you said about the time between now an inauguration day and uncertainty between now and then. I mean, we are literally sixteen days away from that, just over two weeks. What can happen

between now and then? That's going to speak investors well, Tam, I I I hesitate on that because, um, it's only speculation, but it would it would most likely emanate from UM Pennsylvania have UM and it would probably uh not involve the eleven Senators unfortunately that are not going to vote in an affirmative way on the sixth or the hundred odd House Republicans who are not going to vote an affirmative way on the sixth UM. And I I don't

think that's likely that they vote no on the sixth. Oh, well, they've already claimed, they already stated that they would, so I think we have to take them for their word. But I think the reality is that the outcome is cooked in the in the books when we look at the numbers, president president like Biden will be our next president. Um.

But it's a sad commentary. I watched all one two minutes of the telephone call between the Georgia Secretary State and the President on Saturday night, and I was, even as an American, but frankly as a Republican, appalled by what I heard, um coming out of the mouth of our commander in chief. Just very disheartening. Well, and you know, just got a few minutes or a few seconds left here erin. I do wonder, you know, more republic kinds maybe not coming out and saying, well, wait a minute.

You know, we're talking about our democracy in our system that has been in place for you know, a few hundred years here, and I do wonder what that might be foreshadowing in terms of how the Democrats and Republicans ultimately work on the other side of you know, in a Biden White House, are you a little nervous about how that might work or not work, and just got

about forty seconds here. Yeah, I mean, I'm an idealist in so many ways, and I believe that when good intention people come together, they try to find compromise to move the proverbial ball down the field. And I do fear that the water has been poisoned and that may be less likely to happen now going forward. But if you look at Biden's history as a senator dating back many decades, he is someone who wants to work with the other side. Hopefully he'll he'll he'll strive to do that. Yeah,

figures crossed on that, no doubt about it. Um. Aaron, thank you so much, always thoughtful. Aaron Kennon, co founder, chief executive officer, Clear Harbor Asset Management about nine redmillion in assets under management, on the phone from Stanford, Connecticut.

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 too on YouTube by searching Bloomberg Global News