Why a Wayfair Sales Tax Case Sparked Pandemic Windfall

You can also listen to our radio show at two pm Eastern Time on Bloomberg Radio or watch us on YouTube. Search Bloomberg Global News. Well a lot of virus headlines to catch up off on this Monday afternoon. The big news today, though, the CDC issuing it's long awaited guidance

for what fully vaccinated people can do. They say that fully vaccinated people can visit indoors without masks, but still must wear them in public and avoid large gatherings went around those who aren't immunized or who are at high risk for contracting COVID nineteen. Dr Rochelle Willinsky of the CDC made the announcement earlier today. Fully vaccinated people can visit with other fully vaccinated people in small gatherings indoors,

without wearing masks or physical distancing. Remember here we are talking about private settings where everyone is vaccinated. Private settings where everybody is vaccinated that long awaiting guidance. Again, that's Dr Michelle Willinsky of the CDC with those comments earlier today. Joining us now from Seattle is Dr Joeanne Roberts, chief

Value Officer at Providence St. Joseph Health. Dr Roberts, thanks so much for joining us on this these this guidance from the c d C. What was your reaction as a doctor when you heard this earlier today. It's good to be with you, Tim, and thanks so much. I was really excited and I thought the CDC is recommendation

made a lot of sense. And it's a real, real gift to families, especially because I think uh grandparents have been separated from their rand kids and this will be an opportunity for them to get together for the first time in a year. Some people may be saying to themselves, though, no more avoiding the in laws right. Perhaps so no,

but it's a big step forward. Dr Roberts, um, but again the caveat these are people who have been vaccinated, like, we need to remember that they're still and I think Dr Lensky kind of laid this out to that there are still risks out there because the numbers haven't come down as quickly as everybody had hoped. No, and they have plateaued, Carol, and that that is concerning and we'll see how that plays out in the next few weeks.

But I think her her comments about vaccinated people in small gatherings at private settings with vaccinated people and then also vaccinated folks who are with low risk folks. So and again that's that's the typical grandparent grandchild kind of relationship where the kids might not be vaccinated, but they're not at high risk of getting terribly sick, so they feel that that's a fairly fairly safe environment as well.

You know, Dr, when I heard this from Dr Willnsky earlier today, I thought, this is just a huge win for messaging around the vaccine, because what it does is it shows you that the CDC is finally now saying you can act differently after getting this this this life saving medicine. Yes, I I agree, and I welcome also Dr Willnsky's leadership in this. I think historically the medical community has looked to the CDC as a voice of science and reasonable policy, and I think we're hearing that

from the CBC. Now. Dr Roberts want to ask you. You guys have been really kind to us here at Bloomberg, and we have been talking to you for over a year. UM, as we've all been dealing with the pandemic. You guys were ground zero. You're one of the largest health care systems in the US massive fifty one hospitals, seven states. Uh. Massive, But the first case of COVID was within your hospital system. So here we are a year later. Are are we where you thought we would be? And what gives you hope?

What gives you frustrations or nervousness as we move forward? Oh? What a great question. I you know, I, Carol, We're actually in a better place than I expected. UM. I think, especially with this release of the most recent vaccine, with Johnson and Johnson vaccine, I really think that we will see something close to normalcy six months sooner than I than I would have expected six months ago, for example. So Um, as bad as things have been and we're not out of the woods yet, I think the future

is looking brighter. Um, than I would have thought a few months ago. When you say normal, quote unquote normal, as we like to say, Um, we've heard different things. We've heard October, November, we've heard maybe summer. What's what's your time frame in terms of society feeling a lot more normal? Well, I think you know, I'm not sure we'll ever go back to what we used to call normal. I mean, I think a mask is going to be

part of my wardrobe for the law to future. I mean, I I frankly, I don't think I'll be getting on an airplane even two years from now without a mask. Um. And that's okay. I mean, that's a small price to pay to stay healthy. Um. But I think we'll be seeing slowly larger and larger gatherings my guests, especially with this most recent report in with CDC. My guess is it by fall, schools will be meeting in person most

in most of the country. But I think, um, as the Biden administration has said, if we can get these vaccines out by this summer, which is looking likelier, I think we'll all be able to gather again. By Can I go to a concert anytime soon with thousands of people just got about thirty seconds here. I wouldn't be going this spring, but you know, you might start looking at take up for the ball, maybe wearing a mask, Carol, maybe,

probably always Dr Roberts, I want to ask you. It is International Women's Day, and I just think, here we are still talking about women, you know, having the same opportunities as men. It's gotten better. It's certainly different than it was from my mom or my older sisters. And it was for me and it will be for my daughter who's a teenager. But I do wonder, as a woman coming up in medicine, what was the toughest thing you ever faced? Oh, my gosh, there a list, honestly, Oh,

there's a there is a list. And uh, you know, by the time I came to medicine, Carol, Uh, more than half of my medical school quests were women. So I think, um, women were part of the mainstream of learners, but they still weren't in the mainstream of leaders and in academics. I know that it's still true. Uh, there's

lots of articles written about it. I will say I just heard in our organization this morning of our senior leaders at Providence are women, which makes me very proud to work for an organization that recognizes that women can and should step up to leadership. I'm wondering about we have heard so much about during the pandemic, how this has disproportionately affected women. Um, we've heard of women dropping out of the workforce. Are you seeing that in healthcare

at all right now? I mean we know about burnout when it comes to doctors and healthcare professionals, especially over the last year. They have just worked so hard. What are you seeing? What we're seeing is you're right, burnout is that all time high? We have not seen an exit from the workplace, but we are worried about it because once things come down, I mean, healthcare workers will respond to a crisis like like all public servants. They

will step up in a crisis. Our worry is that folks are so tired and so burned out that once the crisis is a little bit further along and it's past, that we'll see people leaving the healthcare field. Um. And we're working hard to prevent that as things get better. Wow, that's worrisome. It is worksome. Yeah, what has to change to prevent that? We've already seen? I mean, haven't we already seen some big changes to the way doctors and

medical students will spend their early years. The hours have shifted in recent years, right to make it less taxing. Am I correct in thinking that the hours in training have changed, but the hours in practice haven't changed. And uh, and we need to recognize that as tell tell a health becomes more common, that may be a way to reduce the workload on positions in their suits. Um, we're just going to have to continue to experiment and try things out. It comes down to putting our caregivers in

the center of everything we do. What we when we find that we serve our caregivers first and foremost, they will serve their patients first and foremost, and they'll take care of the better. You know. I came across some stats kind of getting ready for our chat with you, and women represented close to the global healthcare workforce in so a few years back, almost half of all doctors

in the O E C D countries where women. So we definitely have seen a lot of progress when it comes to management, like you mentioned your organization, But in general is that the case? In general, that is not the case. It's better across the board. Uh, The area that I'm most concerned about is in the academic world, where where our young people are learning how to become

doctors and nurses. We want the academic world to recollect the greater population, so more than half of when more than half of medical students are women, I would like to see the time when more than half of our senior faculty or women. It is so it is so interesting to be talking about burnout at the same time as seeing the headlines UM that a record number of medicals of students are applying to Meta School Medical School because they've been inspired by what has happened over the

last year. And we only have about twenty seconds left. It's the most honorable thing I could imagine doing. So you're asking the biased observer, Yeah, well, we appreciate it as always. Dr Joey and Roberts, thank you, Chief Value Officer, Providence St. Joseph's Health, massive healthcare system out there on the West Coast and actually throughout seven states UH in the United States, joining us once again on the phone from Seattle. UM. Good to hear perspective though in terms

of one year later. And I also love hearing the optimism right just so optimistic about about where we are now. This is Bloomberg Business Week with Carol Messer and Bloomberg Quick Takes Tim Stinovic Bloomberg Radio. Carol, is strange thing happened in and I talked talked about this quite a bit. Despite the fact that the US economy saw the deepest recession since World War Two, millions of people lost their jobs, state finances in general, we're actually okay, like, what's up

with that? Yeah? So, for example, Texas faced a four point six billion dollar budget shortfall last July, and now it's just a fraction of that. This build on that story we talked about last week, right, why are the States in a tougher place? And this one provides a little bit of another piece to that puzzle. Joining us now from the from the student, well not the studios, but a studio here in the middle around the bend, yea maybe down the staircase Bloomberg Headquarters. Is Danielle Moran

Muni Bond reporter for Bloomberg News. Her story is in the current issue of Bloomberg Business Weekend. It is all about a Supreme Court case a few years ago that arrived just in time for the pandemic. Hey Danielle, Hi, guys, how are you so? Tell I'm good. Tell us a little bit about what happened between Wayfair and one of the Dakotas. Yes. So, for years before the pandemics, state and cities were worried about losing on one of their

major sources of revenue, which is sales taxes. As brick and mortar retail shifted online, people stopped going to malls, stopped going to stores, they started buying stuff through their computers. And that debate really came to a head in with the Supreme Court case that decided Um South Dakota versus Wayfair,

the furniture diet. Um that South Dakota passed the law that allowed them to collect sales taxes on purchases from companies that didn't have a physical presence there um, and the Supreme Court upheld the decision saying that they were permitted to collect these taxes. And that really was a like for two disdecision coming two years before the pandemic

went almost all shopping shifted online. Talk about timing well, listen like as a consumer right for such a long time, so I know when we would shop to you would find a place that didn't ar sales tax, especially on like large items, if they didn't have a store, and you would. I'm guilty of that. I did it in the past, even before that. People in Manhattan would go to New Jersey two years ago to do this right and still do you know? You see that? So listen,

So what a windfall for for UM the states? Tim was talking about some of them, whether it was Texas specifically. I mean, we're talking about real money, Danielle, Yes, we are. And and so for example, California is the world fifth largest economy. They reported that online tactical sales more than tripled in the first half of compared to a year earlier. New York reported a dramatic shift in consumer spending as

people UM started shopping online more during lockdown. And this really bolstered text collection UM and really lead to a UM a happy I guess collection for states that we're going through some really tough times, Danielle. I have to say, reading your story it made me think too that you know, whenever we talk about increases in taxes or tax policy, everybody's like, I don't I don't want to pay more taxes.

But in some ways this was a way of easily increasing revenues, helping out states, providing another revenue stream and kind of shared among the public. Right, So this was a The way that the Texas controller described this to me is for him, this was an issue of fairness. This is saying that you can if you have to walk down the street and you can go to your local store and you have to pay sales taxes there, why don't you have to pay them online? Um? And And that was sort of a core issue for him.

And then as states started implementing these laws allowing them to collect from remote sellers, they also implemented laws allowing to connect from collect from these marketplace aggregators which are UM like etc. And eBay, places where businesses can sell products to consumers. But also liked it. But what I did learn in your story too, was that not every

state has been able to do this. Uh, Florida and Missouri are among the forty five states that levy sales taxes have who have not moved to collect those dollars yet. Does does that mean that they missed out on this completely? They're working on it, though, are they They're working on it,

but they have bills making their way through the state legislature. UM, but experts that I have talked to say that they may have left money on the table for not implementing something a little bit sooner, given this really acceleration in the e commerce space of the pandemic sort of forced

on consumers. But I think it's just such an interesting way when you think about the tax base, right, and we think about federal taxes allocating to different states and so and so forth, I mean, here's a way of really helping out states and municipalities. Danielle, Yes, So this was um the ability to collect these online sales taxes really helped mitigate some of the fiscal fallout that states and cities were feeling the pandemic, and they were um

seeing revenues fall in other areas. So you have hotel taxes. People aren't traveling, they're they're not staying in hote hells. So that was an area in almost all states that saw decline. And this, although not a panathea for states, really helped sort of cushion the blow um in in other revenue areas. Now, I know that states don't break out all the types of tax revenue that they get, so we don't necessarily know in every single case what portion came from online sales and this quote unquote new

tax um. But in general, do we know from the analysts you spoke to, from the reporting that you did, just how much it helped in so um from the experts I spoke with that this Wayfair decision could not have committed better time for states and local governments. If you look at Texas, for example, they gained over one billion dollars in the first twelve months of collections and half a billion since they started collections just for local

local governments. That is a significant number, even for a state as biggest Texas that was going through some pretty difficult financial expectations earlier this year. I guess the days of finding those tax free, don't you remember? Did I totally remember? And I remember when this decision came down. It was a bit. It was a big one. It's a big fight for It was a big fight. And the funny thing is is we're talking about Wayfair here.

But it was a big deal for Amazon too huge, Not as much now because they have they have distribution and like a physical presence in so many places, but it was huge. But I remember having conversations we're buying something at home, like, yeah, but you gotta you know, you gotta pay sales tax. Let's look somewhere else. We can't do that anymore, Danielle, great piece of reporting. I really appreciate it. Danielle Moran, MEETI Bomb reporter at Bloomberg News.

Her story, by the way, in the current issue of Bloomberg Business Week magazine. It is on newsstands, online and on the Bloomberg terminal. You're listening to Bloomberg Business Week with Carol Messer and Bloomberg Quick Takes Tim Stinovik on Bloomberg Radio. So this is Bloomberg Business Week and our next guest. The company that she works for, State Lauder. It's a behemoth when it comes to cosmetics, skincare, Khan, you know who they are, Fragrance, it's one of the

lord just in the world. They own a portfolio brand, some created internally, many others like Lamaire, Bobby Brown, glam Globe, Mac and others they've been acquired. They really have their pulse on the consumer, especially when it comes to this space. Joining us right now is Tracy Travis, Executive Vice President Finance CFO of s day Lauder and she is with us on the phone in New York City, Tracy. Great to have you here with Tim and myself. Do we have her? Okay? Good? Good? Yes, we can uh listen.

Great to have you here. And there's so much to talk about. And we're very interested in your new Equity and Engagement Center for Excellence. And I want to get into the programs you guys have in just a moment. But I'd love to get your thoughts on today's environment. I mean S. D. Lauder is a global brand, so well known, you sell in some hundred and fifty countries. How would you describe today's global market environment right now?

And and how the consumer is doing? Yeah, I mean the consumer um, you know, based on what we've seen globally, you know, is still UM supporting obviously prestige beauty. I mean our our sales, you know, are are recovering UM, you know, every every month, every every quarter. Certainly we just reported our our second quarter results UM and we return to growth UM for uh, you know, a quarter

earlier than what we had expected. UM. But the consumer is uh, you know, is gradually UM you know, coming back to I think spending UM in in the categories that that are important to to her, like beauty. How did consumer spending shift during the pandemic? Consumer UM spending shifted very much UM to online. First of all, so you know, we were one of the companies that um our our distribution was deemed to be non essential globally.

You know, we sell only prestige beauty, so we sell in a lot of department stores and specialty stores UM which closed UM initially during during the pan eMMC UM and then reopened. But you know, traffic has been been

a bit light UM and has gradually been building. So we saw a tremendous shift to online and we were prepared for that, you know, with our own brand dot com sites UM, with our retail partners and UH and their sites as well as some of the platforms in pure play UM sites that that we sell on UM. We saw a tremendous UM you know, UH shift to UM to looking for her favorite skin care products, whether it's Lamaire or Clinique or or Essay Lauder UM or some of the other skincare brands that we UH that

we have. We also saw UM a pick up in fragrance UM and again no surprise, more people working from home people um were Um, we saw our our bath and body category grow as well as our home fragrance category grow. UM. So you know, those are are some of the trends that we have observed during the pandemic.

Makeup has been the most impacted, no surprise given given the fact that you know, many people are working from home, and those that are going out many are wearing masks as uh, you know, as instructed, and so that does have an impact on particularly the largest categories of makeup,

foundation and lips. UM. And those are categories that we expect, certainly as the vaccine rollout um, you know continues to progress, uh and uh, and we start to see people migrating back to work and back to school and resuming some of their social activities. UM, we expect to you know, to have a strong, strong makeup recovery at that point in time. Tracey, I feel like you've described me. I spent so much more on skincare uh in the last year or so. UM then then you know, certainly on

you know, traditional makeup. And it's just very interesting you talked about though, you know, shifting to online and I do wonder we've seen just an increased digitization shin of our world when it comes to retail, not just you guys, but everybody. And you know, folks that had strategies that maybe they were going to roll out over the you know, next three to five years, all of a sudden did

them overnight? What has changed in terms of your digital strategy specifically because of the pandemic and just you know, seeing how this is how an increasing number of consumers want to shop. Well, we had a very strong UM focus on on online for for many years. Actually we started our online sites more than more than twenty years ago UM, and we were focused at was our fastest growing channel heading into the pandemic. What we've seen is

an acceleration of the penetration of of online. Certainly, more consumers, a lot of new consumers that we had not m seen purchase online previously started to purchase online. Obviously when when UM, brick and mortar, UM, you know, became less less attractive to to shop in UM during this pandemic. And so we expect that we're going to continue to

see those those trends coming coming out of the pandemic. Clearly, we expect that consumers will return to brick and mortar, but those that you know have developed the habit of shopping online, we expect will continue. And we have added quite a bit of functionality to our online site that have many of our retail partners. We've added virtual try on in terms of makeup UM, we have a virtual diagnostic for our clinique brand UM. We have live streaming events.

We've added a lot more video content and how too, and we've actually seen which is one of our encouraging signs for makeup, We've seen more consumers actually access those videos and uh UM you know, with an interest in learning more about skincare treatments as well as UH as well as makeup treatments as well. This is this is a business where people like to try before they buy UM, and you know they do that in person in stores. I'm wondering how the person experience is going to change

on the other side of this pandemic. We think that you know, again, uh you know, we have tried to add as much consultation to our online sites as as possible, but we also know that people miss that human interaction UM and that ability to actually buy now, get now, and so that's something that you know, certainly an in store experience provides an addition to as as you mentioned, being able to physically physically try on product. You know, we have sanitary practices at you know, all of our

counters and in our freestanding stores. UM. So you know, as consumers return, you know, we are are making sure that UM, that they can try comfortably. And and you know, in terms of the behavior's post post pandemic, you know, we do expect that. You know, we ended last year with our online business UM. You know at a twenty penetration. You know, we certainly expect grow from from there going forward. UM. And that was quite a step up from you know,

from fiscal fiscal nineteen UM. So again you know, we are prepared prepared for that. At the same time, though, we do expect that people will come back to UM, to brick and mortar to try to be able to try and buy products you know, UM at the same time, UM, and that's some of the benefits of brick and mortar, and and certainly UM the physical interaction that that you know, so many people crazy these days by by by not

having as much as they protect themselves during this pandemic. UM, we think will resume as well, well, and I'm gonna say, you know, I tend to buy more when I'm playing with the product. You know, you just that's the way it is. And I have to say, full disclosure, I had an aunt who was an sty Lotter rep for many many years in Houston. Um, you know that whole face to face and she's what got my family kind of started on all the different Esty Lotter brands, whether

it's prescriptives, whether it was origins, you know, you name it. Um. But I'm just curious just to push the point, you know, increasely a younger generation. I've got a teenager, she goes to Sephora, Like that's where she's going. How do you guys continue to move forward where you're known for your counters um, And that's a big part of the story, but how do you start to embrace you know, increasingly

the Sephora model. Yeah, no, we we actually have a very strong relationship with Sephora globally, so we have, um, you know a number of our brands, I think right now around seventeen or eighteen of our brands currently in Sepphora right now. Um, we have a strong presence as well. Um, you know with with Sephora Online and the same with

with Ultra and Douglass and many other specialty retailers. So we have, you know, throughout the course of the last UM you know, the last five to seven years, really expanded our penetration in in specialty MULTI because the department store channel, our historical channel of distribution, obviously has seen

competition from other channels, including online UM. So it's been important for us to be able to diversify our channel MIXED to be present in those other channels where to your point, younger consumers UM and other consumers as well are increasingly UM shopping at least part of their shopping

experience annually or or all of your shopping experience. So so we feel very good about, you know, how how we have broadened the diversification of our channels UM to be able to reach other consumers and again online obviously being a ubiquitous UM you know too and available to everyone. We we talked about consumer shifts during the pandemic and the different way that you are expecting consumers to behave

post pandemic, what trends will stick. But I'm wondering about about your own employees and what you're seeing from your own employees, specifically when it comes to working from home, how potentially you have to make real estate adjustments at corporate headquarters and other offices throughout the world because of this new normal. What are you doing? Yeah, well we so we do have UM a number of our employees to your points that have been working from home, UM,

at least in the US now almost a year. UM. So we're coming up on the one year anniversary of of of working from home here in the US, and we've already passed that universe of that anniversary in in some of our other markets. So UM, we have many of our offices opened for UM UM for those who

want to come into the office. UM. But most people are are working are working from home, and we are in the process now of determining UM for a whole variety of reasons, UM, you know, a more flexible working model for when when people do start to transition more permanently back back to the office. UM. And we do

expect that, you know. And UH, and we announced that we actually have given up some of our office space that we had committed to here in UM in Manhattan, UM, because you know, we are looking at more of a hybrid model going going forward. That does a couple of things for for us, you know, as we think about the pandemic and the impact that it's had, you know on our you know, our workforce. You know, our workforces

percent female. We have a lot of young mothers in our workforce that have really struggled UM during during this time frame to work from home, UM, take care of the household, take care of kids, elder care, etcetera. UM. The ability to be able to offer more flexible um UM working arrangements UM you know, depending on on the position UM will be you know, will be very important for for us going going forward. And many of our policies in the company are are very much here towards

families and supporting families. Given given the high penetration that we have of female workers. We have you know, twenty weeks of paid you know, parentally, we have another six weeks of back to work flex stability UM. You know, during the pandemic, we did expand childcare and elder care benefits UM. You know, we again are trying to support

more flexible work work environments. We have UM expanded our employee assistance recognizing the amount of stress that that people are are under so UM so we do, you know, certainly are taking some of the lessons from this pandemic and UH and going forward looking at how we can UM you know, UM continue to implement some of some of the policies that we think will be beneficial going forward to our employees learning learning as as we go.

There are a lot of companies experimenting with more flexible ways for their employees to work. And at the same time, we hear stories from Silicon Valley about people relocating to potentially less expensive areas and and perhaps they're pay being cut. Are you thinking about changing compensation at all based on where an employee lives or or if they're coming into

the office. We have not had that conversation yet. Now, you know, we do expect that our office footprint will remain will remain the same, UM, you know, in terms of where our you know, the majority of our footprint is in our various markets. So talk to us a little bit more about the programs that you guys have at s D latter. I think I love the statue teld Us Tracy that you know of your workforce is female. That's just not typical if you go around corporate America.

But it kind of warms my heart to hear that you guys have recently created an equity and engagement center for Excellence and it's you know, equity and representative representations within every aspect of your business. It's very holistic. You know, how are you doing this? Yeah, so we we UM and thank you for the question. We announced this about a week ago. UM. You know, we've always been a company that has been committed to inclusion and UM and diversity.

And as we think about the events of the last year or so, in addition to the pandemic UM, you know again the impact that has had on on women, UM, some of them you know, racial inequities that that certainly have UM you know come to fruition UM and UH enlightened and some of the commitments that we made last

year UM to racial equity commitments. You know it it is it is time, certainly for us to think about how do we evolve you know, some of our very good practices UH and deepen some of the commitments that

were we've made, UM, you know going forward. And so you know, our you know, our our newest center of Excellence is really geared to do that Equity and Engagement really work with you know, our our HR executives, all of our executives across the company to make sure that we are UM providing leadership and development programs UM for all employees, but certainly UM you know some that are specifically geared towards women and their and their special special

needs UM making sure that you know our UM you know, our HR programs are really focused on making sure that we are equitable in providing opportunities equally for all of employees who are you know, UM UM ready for that next chapter in their career. So UM, it's very exciting

from from a company standpoint. We have a wonderful leader of our equity and engagement THEOE Nicole Munson, who who has been with the company for for some time in our legal department and UH and has transitioned over to to leave this effort UM and are very excited about about this being another chapter in our you know, evolution

UM to have a more equitable workplace. We're talking with Tracy Travis, she's executive vice president of Finance and chief financial officer to St. Lauder with us on the phone in New York City. Tracy, UM, we have had a lot of these conversations about inequities, equality. Uh, it's not just any one subject. Do you know that, I know that Tim knows that. UM. How do we really move

the needle? Yeah? I mean I I think I think, UM, some of the things that are happening right now and some of the push that's happening in terms of greater transparency and accountability UM is one way where we move the needle. UM. So companies are you know, UM uh providing UM and being you know, certainly UM asked to provide more transparency on you know, gender pay equity. UM.

We've committed to to reach equity by UM. You know, we have almost gender parity right now on our board of directors UM, and we are committed to achieving and maintaining that by UM. You know we've made Why does it take? So it's not to you guys specifically, but I do feel like when we have people put out projections in general, it feels like everything always takes so long.

Why is that? Well, I would say, right now, if you think about the current business environment, you know, we're not doing a lot of hiring right now, and and also from a board perspective, it's a matter of obviously retirement on on boards to make make room for you know, uh for some of these um uh, some of these strategies to to be able to take hold. So well, you know, one of the things that we are known for as a company is you know, uh, um, when we set a goal for ourselves, we strive to um

to beat that goal. And so I'm you know, fairly comfortable that um, given given some of the goals that we've put in place, we will certainly strive to two more than than achieve them. But I mean, right now, they're you know, there's not a lot of companies that are doing with the exception of probably tech companies you

know that are doing a lot of hiring. So that is taken into consideration when some of these timeframes are are established, and no one, no one wants to miss you know what, no one wants to to miss a goal. But the great thing is, Carol, that you know, you know, we are being held accountable, being accountable by our employees, We're being held accountable by our board, our you know, our CEO, our executive chairman, UM, and our consumers and investors. And so you know that is I think a different

environment um than has you know, existed previously. And as a result of that, I think, you know, we are going to see I'm optimistic that we're going to see more progress in these areas. But it has taken a bit of a reckoning. Yeah right, point, hasn't it? Yeah? Absolutely? But I think what you said accountability. Listen, Tim, and I he s hearded me said a million times. I say it to my teenage daughter. You know, accountability, accountability for actions like we all have to live by that,

and I think that's what ultimately brings about change. Tracy, thank you so much. What a great deep dive, and really appreciate all the time that you gave us today. Tracy Travis, she's executive vice president of finance and chief financial officer at st. Lauer. Am the phone in New York City, Marco Journal. Yeah but you let me drive? No, no, no, all night please, I'll do the riding drivel let me. I want to drive, Just drive baby, question dry this is the drive to the globe. Give me thanks. We'll

drying us on Bloomberg Radio. All right, everybody, just about eleven minutes left in today's trading session. Time for the drive to the close. Back with Us is Hillary Kramer, President and chief investment Officered Angie Capital Research, author of Game Changer Investing Back with us on the phone in New York City. How are you very good, Carol on Women's International Day? Yes, exactly, nice to have you here. Hey, Tim actually brought to my attention, So I'm just gonna

go right there. One of the gets the most read story in the Blomberg in the past hour, and it talks about how the Nazark one and the Dow Jones Industrial average diverging the most since what does that say to you? Does it make sense to me? Part of it makes sense to me that I think allow those tech names as big momentum plays are seeing a little bit of a reflation trade. But how do you see it?

The the higher rates that you as treasury ten year bond absolutely dictates the price and valuation of the nastec stocks. We take it. It's like pure fundamentals, it's like financial theory. We we value these companies based on how they're going to do in the future, and when we look at these big tech names, we're looking all the way out

and it just makes evaluation that much lower today. That's what's happening there also people are people are trading today, and I say people, not just investors, everyone, they're in the market. They're rotating, they're they're like trying to like like their tails, so to speak. So suddenly, you know, check it out. And and the realization has come that there's some really solid companies that people left for dead for how long did I talk about Goldman's Acts or

Valveoline or older Public Insurance. Now these are getting fully valued. So we need to be really careful. Don't think that you can't get hurt, you know. On the other side, and what Charlie said before, it is a tale of two of two uh two tapes, very much so because there's so much, so much selling going on. And uh but I think the electric vehicle space has also been hurt really bad. You know, those hot new areas, that thing you know, kind of crashed and burns very quickly.

But it will come back. It'll have lots of iterations, will be lots of microvisions and discers fsrs to come and neo's But anyone who's trying to do well on those it's not working. And that's why also we've seen this this rotation now also energy stocks. Of course, that's the other reason, right, the price of oil starts to

rise and the value of the dollar has dropped. I don't recommend anyone runs out and gets their X and I'm happy it's that a fifty two weeks day, fifty two high today for all of you have been holding it for you know, the last fifty years. Uh, but it's really it's really a time to be really careful and find the right stocks. You know, something like big Lots, which I loved at ten dollars and seventeen and twenty,

you know, up at seventy dollars. It's sort of like a five and five below with Raymar and Flannigan mixed in with furniture. You know, think about it. This is a stock that schooling not six hundred percent, so um like we're looking we're we're we're rotated to we're looking at companies still like ingredient that really hasn't caught on yet.

That's the old corn products. It was in the original Tao list Um and an ingredient, you know, with that dividend yield and with the fact that the stock really came down with expectations that the institutional food service business, arena's stadiums was dropping ingredient makes all this, all the sugars, starches, corn syrups, it's all the cliff bars and French fries and hug and dust. I never imagine. So we'd like to company like I N g R. We think that

that still has some room to grow. So you're ready to do the post pandemic trade here? Oh yeah, absolutely, even if we retrace. Remember, like we always talk about the insecurity, the unknown. The stock market hates the unknown. Even if we have a variant that comes into play and we see the numbers start to rise and coronavirus, there's a feeling, there's a sentiment nationally, other places much more than others. Certainly New York City is more conservative

and concerned and modest in their approach. But we can handle it. We can handle it. And it's not just a vaccine the drugs coming out. If you do who ked it? You know the masks are working hard and ever you want to pull it. If we're all looking towards the future. Hilary, speaking speaking of that, J and J is a company that's that's on your list. What's a feeling to you about about J and J. They've

come back in. The stock was depressed, had the overhang with the liability, with the lawsuits, the pether powder right exactly, that bave powder that really kept a lot of investors out in the big institutions today, um with all the focus on E, S G and being socially responsible, a lot of those kinds of companies because the way these companies have to be rated, like a Johnson and Johnson when they have a liability and a and a legal

action against them, don't get bought. We're gonna see more and more of this as this regulation comes in with s G, but J and J with the vaccine, people are starting to see it, understand what they do the same way I think is going to happen with Bristol Meyers at six feet now Goldman facts, I'm with them. They see I've seen between d dollars targets that they

have on you know, three point two percentivity yield. And it's because no one's paying attention to Bristol Myers, b M Y what celgene and that hotest louis here about and Revelman and Eloquis, you know, all of those are Bristol Meyer drugs so right, it's a reminder to look at kind of what's going on more broadly and look at companies that are making fundamental decisions or are taking actions that will affect their revenue streams going forward in

their earnings potential. And you know, Jane j like I think about those companies that have come up with a vaccine. I mean, this isn't a one year thing. This is multiple years. Right, We're expecting to have to take this vaccine probably every year. And just got about forty seconds, okay, And that's why a company like Sonofi, also S and YU, the J and G of j and J of France. But they've been doing vaccines all over the world. They have there in the top twenty vaccine vaccines. Those companies

will come into focus. Just everyone should be really careful about jumping into the United Airlines and even the Disney. You know, at this point there's still on the opening up for Kid Team percent capacity in Los Angeles. It's a great story. It's really Disney plus story picture. Everyone be careful, keep your powder dry. You haven't seen anything yet. Yeah, I gotta say, shares a Disney up almost seven percent today,

you know, everybody Mickey Minnie. Everybody's excited about reopening the Kingdom. Hillary be Well, good to check in with you. Hillary Kramer over at A and G Capital Research. I mean, you could just feel people are just like, alright, let's do it. Look on Twitter on Instagram over the weekend, I saw people were doing the movie theater thing here in New York City. They were getting back there. I'm not ready for that. I'm not either, but I'm not

vaccinated yet. Maybe I'll feel differently when i'm vaccinated. You're right. Thanks for listening to Bloomberg Business Week. Download the podcast on iTunes, SoundCloud, or Bloomberg dot com, and you can also listen to our radio show at two p m. Eastern on Bloomberg Radio or watch us on YouTube search Bloomberg Global News h