Bloomberg Audio Studios, podcasts, radio news.
This is the Bloomberg Surveillance Podcast. Catch us live weekdays at seven am Eastern on Apple car Player, Android Auto with the Bloomberg Business App. Listen on demand wherever you get your podcasts, or watch us live on YouTube.
When you're a young cherub and you go to Colorado College, you study physics, which is what David Malpast joining as the former president of the World Bank iconic at bear Sterns years ago. David malpast darkens the door this morning. Casey has yet to concede. In Pennsylvania. Tuberville, the football coach, dragged.
You into the Senate. He said, we need senate testimony.
From David malpass On. You know, global economics in all that, you're one of the few people I know that's actually been in the trenches in the United States Senate. Do you see with this new administration, David, with your affiliation with the Republicans, do you see a suddenness rapid movement between the executive and the legislative.
Branch or will it be slower and more iterative?
Hi? Tom, And that's a great question and issue. I think it'll be pretty fast because there really is a mandate from the country to bring change.
Then how do you see a mandate.
I've got Vice President Harrison narrow it down to fifty forty it's something like two hundred and thirty eight thousand votes and.
Three swing states.
I got a guy in a San Joaquin Valley right now, Republican winning.
By under three hundred votes.
If the Democrats take west of Fresno, it's one more Democrat in the House.
It's not a mandate, David.
I beg to differ. So it means all seven of the swing states were one. And if you look at all the demographics, in other words, each but if you parse it by age, if you parsh it by by u, by by skills, you get people wanting change. And so that means the Senate is going to come Let's come
to your question. There's a turnover, a very important turnover of the majority leader, and you know, the staff on all the committees turns over, and so there will be people whose lifeblood is not regulating and so that means a big change in how the Senate operates. Of course, it's the deliberative body, and it will take time to
get some stuff done. But I'd imagine there's going to be a tax movement on the tax front very quickly, of course, on energy and on on on trade where the system is broken, so you'll see all of that moving, you know, month by month pretty rapidly.
What do you think of some of the president's cabinet nominations to date? What is it? What have you kind of sensed?
He's well, I think they're great. But what you see is him wanting change, change, change, And so that to me is the signal coming out of each area. Put strong people in that want change. Look at the energy pick so Chris, Chris, Right, Bergham are really strong, Lee's Eldon, and these are the energy side that can make you know, if you think about how do you make America strong again? And this is peace through strength? Where do you get the strength from production?
How do you do that?
You get the energy sector going so that you can build all the other things that go into an economy.
Yeah, but we're like, aren't we like the number one energy power in the world now bigger than Saudi Arabia.
There's an oversupply.
McLoone says a barrel of oil is going to twelve bucks a barrel I'm.
Kidding, be well, stranger.
You know, remember when to ten dollars a barrel in the year two nineteen ninety nine, in two thousand, when the dollar is super strong, overly strong. So I don't know that we want that low, but it would be good if it comes down. And the bigger thing is the US could be doing so much more. You just named parts of the world that are plentifully supplied, but they are huge parts of the world that don't have enough energy. And think of the craziness that we've got
because of the lack of pipelines. We've got the energy. The L and G goes through the Panama Canal. It's such a wasteful use of the water. You know, Panama Canal is driven by free flowing water that comes from rain, and you wash the ships down both sides of the canal. And you're doing it to get LNG to Asia from the unit from the East coast.
Harbor overlooking they're already San Francisco Giants Stadium.
There needs to be some way to get energy onto the west coast of either the US or Canada. They're building one into Mexico, but how does that really help the US? If you have to go down through Mexico to get your energy out of the out of the hymnstry too.
Much geography with David Melb'll save the conversations.
Down in that part of the world. The G twenty is just finishing up down in Rio here. How do you think President elect Trump views the entities organizations like the G twenty and that try to think about things on a global basis. How do you think he anticipates engaging.
I don't know how he thinks about it, but it should be clear to everyone that the globalism isn't working. This is the giant conferences. Think of that ten literally tens of thousands of people. I've had to go to these conferences. We recently saw the one in Baku. Think of the absurdity of having the climate conference in Baku, Azerbaijan, which is the conduit for Russian oil coming under the
sanctions out into the rest of the world. So you've got this and literally it's ten thousand people from that are all trying to get government contracts. So it's a climate industrial complex, just like the military industrial complex that's so expensive. You need to have defense for the US, but you need to have it in a way that's that's competitive in that world.
David Malpass, for the former President of the World Bank, thrilled that he could join us this morning.
We welcome all.
Of you on your commute across the nation and of course on YouTube subscribe to Bloomberg Podcast. I have literally on the desk at home Lightheiser, No Trade is Free. I'm going to read it cover to cover just to get an understanding of Lightheiser economics. You're at Colorado College lecturing EC one O two macroeconomics. David Malpass discussed the efficacy of tariffs.
The system is broken in the world. It was set up at a time before China was the number.
Two world power.
You had a concept in the sixties and seventies that somehow there could be kumbaya that everybody could cover together. Everyone formed a deal and everybody lower.
Vice President Harris would agree with you.
And it's completely broken down because you have this giantly aggressive commercial power that's not playing by the rules on intellectual property, on their overcapacity of manufactured goods.
So it's a it's.
A you know, taking away markets from the rest.
Of Do we need tariffs?
Did are gradual and marginal or do we need the jump condition that the President elect talks about a magnitude of tariffs that haven't seen in generations.
You need to get the world's attention that what they're doing is broken. I don't know if you saw, but President she was in South America last week and he was making the case to all the other world leaders to go gradual. And so China is kind of bidding for time. They're saying, oh, this is gonna you know, we're moving in your direction. And so whether the rest of the world buys that, and you know, China often pays for it with contracts, with with UH gifts, gifts
that can be UH shared in families and UH. And so how do you stop that and really get onto a new wavelength with China and with the rest of the world in fairness.
Should the US approach to chrying to be one of engagement or one of you know, just trying to really step back from China. How do you think the approach should be?
I think there has so for too many years now, China has been getting what it wants. I saw that in the World conferences. They really are winning on the on the soft power. And so you have to take that back because the US has all the all the ability to do this, it just has been choosing not to do it. You know, we've been trying to get peace through weakness, and so if you switch to peace through strength, China is going to change its side of the of the discussion as well. They're not they're not.
I mean, they've followed very closely what's what's going on in the US and will be responding to it. So then you've got to say, Okay, we've got a bunch of problems. Here's our list of problems. You're producing too much steal with too much coal, with and claiming and then pushing climate agenda through the Paris Agreement that you're not complying with.
We don't like that.
Intellectual property you're stealing. You've never let down on stealing the intellectual property.
David, I got one final question, with great respect Tom Nichols the Death of Expertise Profound book. I interviewed him when it came out. We're trying to get mister Nichols on again to talk about it. This is an administration. David Malpass has the best English skills of anyone I've ever known.
On Wall Street.
You and John Writing were prodigious in your economic output for Alan Schwartz at bear Sterns Physics, Colorado Collegey. You're the real deal on a conservative tone. Some of these people have zero expert piece. What would you say to the President elect right now if these people are pushed aside by Senate?
Well, I don't think that'll happen. But what I think what the president can see is that he's clearly on the He's got a powerful path that's taxes, energy, that's making.
Why is he running then from expertise because there are conservatives like you that have their head screwed on.
A problem is expertise often has meant your inside the belt Way with their models, and so if we really have to have an upheaval where you shake it up with people that have views from outside, I got to make.
Some news today.
Have you been called by the president by Susan Are you going to serve within the Trump administration? Come on news, okay, David Malpas, thank you so much. Formerly with the World Bank.
You're listening to the Bloomberg Surveillance podcast. Catch us Live weekday afternoons from seven to ten am. Easter Listen on Apple CarPlay and Android Auto with a Bloomberg Business app, or watch us live on YouTube.
Michael Darta with Roth Campbell and I don't think I've ever seen as political a note Washington. A note out of data is what I've got in front of me in italics. To simply keep current law in place, new revenue sources will be needed, Michael Data, what do you expect in January, February and beyond.
Hi, Tom, thanks for having me on. Look, the Administration and Congress are going to have to work through the confines of budget reconciliation, and that's really just a technical term for saying that they're not going to be able to increase the fiscal deficit outside of a ten year window, and that means they're going to need some revenue in order to either make parts or the entirety of the twenty seventeen ten A law permanent, or if you know, the idea is to to cut new taxes, They're going
to need revenues for that, and I think we know where those revenues are going to come from. The attempt is going to be to generate them from tariffs, potentially a fairly significant across the board tariff increase, and you know, I think the notion that this is just a bluff or a negotiating tactic is simply incorrect.
Yeah.
Greg Valier really emphasizes that from AGF this morning.
He says, this is not a bluff.
What do Trump tariffs do to the stock market?
You know, it's a great question, Tom. You know, I think we have some risks here because the equity market valuations are quite high. On any measure. If you look at forward earnings estimates, which are quite optimistic, we're in
a twenty two plus multiple that's historically high. The so called buffet indicator that just looks at market cap or the stock market itself relative to the nominal GDP or at the highest level since nineteen twenty nine, which, by the way, was the year that smooth Hally passed Congress, cleared the Senate the following year, and was signed into law, and that made it, you know, infamous because that was
the beginning of the Great Depression. So I think we're playing with fire a little bit here if we're going to experiment with potential shocks to the supply side of the economy when equity market valuations are as high as they are, and you know, the FED is so far successfully soft landed the nominal economy. If you look at nominal GDP growth, you know, we've settled into just over a five percent zone and that's happened with productivity rebounding
over the last six quarters. So anything that potentially disturbs the supply side with a relative price shock from tariffs or a slower growth growth shocked to the labor force could end up being a problem for corporate profit margins and these super high equity market valuations that are in place today.
Michael, could you explain the math associate it with tariffs? Is that direct revenue to the US government number number one and number two? Do those increases in cost do they get passed along to consumers and maybe cause of inflation?
Yeah?
Absolutely so, I mean the you know, the tariffs are simply a tax. You know, they would be equivalent to raising sales taxes, but they're not across the board, so you know, it's a it's a narrow tax base relative to the total consumption tax base, so total imports of goods are around three trillion. You know, there's been some discussion on the campaign trail of using tariffs to get rid of the income tax, and that's just not going to be doable because you know, the tax base is
simply not wide en up. So one principle of good tax policy is to have the broadest possible base with the lowest possible rates, and you know, trying to raise a lot of revenue from tariffs does not meet that test, so it will cause distortions. You know, the late great Milton Friedman, I think put it best when he said that the problem with protectionism is that the beneficiaries are concentrated, visible and vocal, but the costs are very diffuse, right,
And that's examply right. So from that perspective, you know, I think this is a risk to the market and the business side.
I like what George Will said in the Washington Post. He said, what are tariffs? They're like putting a blockade around your own harbors. I thought that sort of summed it up in a nice vignette as well. Michael Data, then are you I want to talk to markets when we come back and fed But Michael Darta, are you advocating that people who are measured conservative like John Tucker, they're in there tirement plan. There are days from retiring that they lighten up on equities.
Well, look, Tom, obviously, trying to time the stock market typically does not work out for folks, so I think we have to be really careful with that. A slow and steady approach is the way to go. If John's very close to retirement, then you know, I'm assuming that he's already got it all planned out in terms of
becoming more conservative over time. But what I would say is this, I think these high equity valuations make a very strong case for value investing, which is, you know, kind of gone by the wayside as we've been in the throes of this AI tech frenzy over the last few years, and you could do a Barbell approach. So if there's a small portfolio that you are going to manage, and it shouldn't be the whole portfolio, I would say
defensives on one side. So if we get these rate shocks like we have over the last two months, that's a time to lean into the cases.
Should we continue with Michael dart a rough Capital this morning? Michael, I want to talk about the FED and let's just begin with the beginning idea of a nonlinear move to wherever we're going is the FED restrictive right now?
Boy?
Tom, that's the one hundred million dollar question. You know, fedhare Powell, I think would admit that they don't really know the answer that question. I think they're probably still modestly restrictive, but certainly less so than they were before the first fifty basis point rate cut, followed up by twenty five basis points, and now markets expect you know, one more twenty five basis point cut. I think we
might be close to a potential FED pause. And the reason I say that is when fedhare Powell and company started this cutting effort, what he said was, we don't know where the R star is, we don't know where neutral is, but we're pretty confident that we're above neutral based on all of the mainstream estimates. That is no longer the case with seventy five bases nominal rate cuts in the bag and a modest bump hire in bond market inflation experts.
Oh, Michael, what's so important to me?
And this goes back to your work with jud Waitinsky right out of Wisconsin Whitewater is do you aggregate the nation? And can Powell aggregate our policy?
Or witness the.
Election and all attention. Are there two Americas where the FED has to somehow make policy around those two Americas?
Yeah, well, the FED does have to deal with aggregates, you know, inflation, total spending, nominal growth in the economy, of the labor market. It can't target sectors. That's not the role of the Federal Reserve. If we're talking about, you know, issues in terms of redistribution and taxation and regulation, that really falls on in Congress and elected officials to deal with. And in terms of fiscal policy, you know, the FED has to just operate with what it's given.
And there's a tremendous amount of uncertainty ahead as we move into twenty twenty five. The conventional wisdom is that, you know, we're moving into a more accommodative fiscal environment. But for the reasons that we discussed at the opening, Tom,
I think that may be incorrect. So, you know, if you go back to the strictures of budget reconciliation, the administration is going to have to find revenue to permanently extend any of these tax cuts, and if that means big tariff increases, and the view is that those are not contractionary and don't hurt the US economy. Not my view, but you know, obviously that's the view of the incoming president. You could end up with a substantial fiscal heightening, and
so this is a tricky environment for the FED. If that tightening disrupts the productivity rebound that's underway, that's going to make the Fed's job harder. So you know, there's a substantial amount of uncertainty going forward.
Michael. There are some market observers that as they try to parse through President Electrump's some of his economic policies, whether it be lower taxes, higher tariffs, that they might be inflationary.
Do you share that concern, Well, it's sort of a hodgepodge, Paul. So you know, a big jump in tariffs would be equivalent to a relative price shock, so it would tend to push up inflation on a one time basis and retard real growth. That is not a recurring thing, so it's not a monetary inflation. Typically, central banks would try to look past that and beyond that, you know, could actually lower the neutral interest rate that hurts the supply side.
So it's not just straightforward in terms of oh, this might push inflation up, and so you know, the FED should tighten monetary policy into that kind of a shock. Some of the other proposals may boost the supply side, talking about uh, you know, deregulation, if we're talking about other tax changes or tax reforms that can boost efficiency. So I think we're dealing with a bit of a hodgepodge of potential supply side changes and or shocks, and you know, we're going to have to have more information
and more details to figure out. You know, the over riding trend is going to be whether you know it's more of a headwind or a tailwind.
Michael, the FED feels like it's got inflation generally under control. What's focusing on the labor market what's your view of the US labor market these days?
Well, the US labor market has been hanging in there. Obviously, we've got a very weak report for October, and the pattern has been, you know, one in which we've had a fairly gentle deceleration. But I think we're going to need some more data to really come to a decisive conclusion.
As we moved into the summer, we were getting signals from the unemployment rate that were very consistent with a business cycle that had stalled or even started to enter recession, and now the apoment rate is pulled back a few tenths and essentially stabilized. So there's a big question mark up there.
Michael, thank you so much and said go feed close Kloses. You know klauses vegeance. Klaus is a dog. Michael Darta, thank you so much for Roth Capital.
This is the Bloomberg Surveillance Podcast. Listen live each weekday starting at seven am Eastern on applecar Play and Android Auto with the Bloomberg Business app. You can also listen live on Amazon Alexa from our flagship New York station. Just say Alexa playing Bloomberg eleven thirty Paul, what time.
Are you speaking today at this Ai Men Deep sing Aniragrana Extravagance, are you at four o'clock four thirty Tom?
I'm on the twelve forty three train to the Jersey Shore every single day. I don't stay in New York after twelve o'clock.
But you are too.
But for these two guys on Agrana, Man Deep sing I said yes, because you have to. Because they're the leaders of our technology research of Bloomberg Intelligence. They have this nominal conference today some of the real leaders Tom and his generative AI think which I'm trying to learn about, I'm trying to get smart about. But they've got a lot of the leaders in that industry coming to the Bloomberg egequ today.
Yeah, Wayne Barrow getting it started global ahead of core product like a real job at Bloomberg, unlike what Paulin and I do. This is gonna be a great panel, except at four thirty, everybody's going to turn to.
Their cell phones and ignore Wah or Matt.
Miller because they're gonna be looking at a video in the same room together for the first time since Nixon was president. Man Deep Singh and Anda Abrana, what do you guys see each other?
Like?
What twice a year? Is it that rare?
No?
No, no, we see it far more than that. But we talk at least three to four times a day.
Yeah, what are you talking about right now?
What is the conversation within the madness of technology right now?
Mind and Vidio print? I mean it has to be right. It's reporting tonight and all eyes are on Nvidia and that's what the themo for a conference is, you know, just to connect the dots in terms of what is the flow through when it comes to companies that are buying these GPUs, what are the use cases that are emerging? And is it really living up to the productivity promise. That's the theme of.
The we know, we know that, yet it's too soon, And that's what we've been talking about. Right now the whole buzzes expand the infrastructure, expand the infrastructure.
But today we're going to.
Ask these executives tell us the use cases of these productivity because then the audience can gauge whether some of these use cases are worth the investment or not. Like, does it save you ten minutes to write emails? That's not going to drive the needle. It has to be far more than that for people to invest on the software side, on the application side.
Is there real concern from the clients the investors you talk to that maybe this techn isstry, is going the spending is too much too fast, or is it one of Hey, you guys can spend whatever you want because we think the opportunity is that big.
I mean, everyone agrees on the fact that this is the biggest secular trend that we're seeing, you know, this decade, and clearly it's got ramifications in terms of disrupting certain industries. No one knows exactly when we'll hit the cafex digestion phase, and that's.
What everyone is trying to figure out.
What we are doing in this summit is bringing together both the large company perspective as well as the startup perspective, and we've got some really interesting startups have the summer.
How do you guys, A dainty frances Covid business insider making a splash four or five days ago, Microsoft's co pilots underperformance is the latest red flag for investments in AI.
You guys are grizzled pros. I look at that tremble in a rock.
What do you look at the legitimate worry about is this gonna work out?
I think it's all a matter of how much it's It's not so much that this is not going to work. We are already at a phase that the top tech companies are going to spend close to ninety billion extra in a two year period compared to what they were before. So now the question is what is the output of that, What is the.
What is the okay, okay, right, guys, what is the do you realize the easiest course these two guys took in college was harder.
Than anything we do. Oh of course.
Yeah.
I mean, what's the what's the outcome of this cap bax?
But that's the whole issue. The software and the services companies are saying. Oh, the companies are saying, is it's going to take several years for this to show up in the revenue stream, and all of us are trying to figure out how true it is at this point, because if you don't see that productivity benefit that we are trying to unlock today in our conference, then you will then the companies will say, well, we don't have to spend as much, and that then puts a completely
different multiple or compression to all these stocks. And that's what everybody wants to avoid.
So, Mandy, what are you going to be looking for here from Nvidia? After the close here to you know, Dan Ives was out from what Bus Security is saying. He thinks that they're going to beat the current revenue by a couple of billion, take the guidance up, buy a couple of billion A do you think that could happen? And is that enough for the stock?
Yeah?
I mean, clearly investors have become less sensitive to the valuation that this company trades, that because they are so good in terms of, you know, beating their numbers. And look, when it comes to the future of generative AI, if there's one thing that is for sure is and video is at the heart and center of it. Whether they're going to miss their numbers three quarters from now, that will have, you know, I mean, an implication for their valuation.
But beyond that, I think they just have that lead when it comes to chip makers that is unassailable.
Right now. Tell us about this word ecosystem.
I mean it's identified with the Apple and Services and that is there a I'm speaking with Adobe today. Is there an Adobe ecosystem? Is there a Microsoft ecosystem in ug?
Yeah?
So that is exactly the argument what these companies are saying. Adobe is basically arguing that our ecosystem is that strong that that no matter if there are open source tools out there that can do something.
So old or whatever, Yeah.
That's not going to disrupt our business. And there is a bold and bad argument against it. The same argument you can make for other companies such as Salesforce or Workday or Microsoft. Somebody is saying, well, I can just use open AI and do my work. Why do I need to you know, need this package software industry? And that is the push and pull at this point.
So Man, Man Deep, what's the what's the next thing for AI?
Do you think?
I mean, what are some of these startups that are gonna come to your conference today? What's kind of the next iteration of it?
I guess I'm sure they're gonna give us the message they want some of this profit pool that Nvidia has. And even if you get a small slice of you know, this large addressable market that everyone believes is there in data centers. These companies could you know, have a very successful IPO down the line.
Man from an office upstairs is fancier than mine.
Email's in and says, where's the copyright protection for all the intellectual capital? These animals like aniog Rana and Man Deep singers stealing from us?
How's this gonna work out?
I mean, well, how they gonna pay the New York Times or the Times of London? Man?
And yeah, we have a company called Runway that's in that lineup today, which does you know video rendering based on prompts and they are training their models based on all the content, content that's out there when it comes to you know, Hollywood and stuff like that.
And they're actually using it.
And and we'll discuss exactly what you just mentioned in terms of what are their licensing, what is their own IP versus.
Journalism get paid you know in our cars.
So Adobe is making that argument that come work with us because we are training the models on the data we own or the assets that are part of a company. So you're not going to get sued because you're using AI generated from that trained model.
And that is going to be a page. I cut to the chase. So these two movies out, what are they? Glad Wicked mandeems.
Can see both of them before we do. Okay, there's two movies out. Variety does some stuff. AI steals the.
Content for Variety. How does Variety get paid?
Well in the this case, clearly you know they will have to license some of the content where they're you know, the same actors are being used or the same setup as being used. But beyond that, AI doesn't really replicate your content. And that's what I think these models are showing is you know, the scene that you are generating isn't an exact replica of what has been used in the past.
Do you buy this pot?
I don't know, but I'm gonna hopefully we're gonna get smarter here today. My my panel is raped for cocktails. That's a dangerous place.
That's place to be. My word, Yes, you're brave. My people just know to say no to that.
Exactly.
Are you kidding your nose before?
Okay, So I'm after lunch where they're already asleep when I walk in.
Can you get tickets to the figure as it's sold out?
It's at this point it's virtual only for anybody trying to join in because we don't have capacity now.
But it will be on the terminal.
It will be streamed live on the terminal live.
Got It's like Taylor Swift.
Yeah, exactly.
So let's do this more often, you know, I mean, I know you guys are in speaking terms, but you know, let's do it more often.
This is the Bloomberg Surveillance Podcast. Listen live each weekday starting at seven am Eastern on Apple car Play and Android Auto with the Bloomberg Business app. You can also watch us live every weekday on YouTube and always on the Bloomberg.
Term Tell me look at the front pages. It is Lisa Matteo, our Lisa.
Please, Okay, I.
Got a lot for Paul Today's okay, hear that on her? What's in the New York Post. Just when you thought you haven't heard of Sherry Redstone her name in a while, here it comes. They said that she paid off nearly two hundred million dollars in debt from cash that was mostly fronted by Larry Ellison. Now this was a loan from back in Wait twenty eighteen. She made the full payment. The bounce wasn't doing until May twenty five, so she made the payment. But it was one hundred and eighty
six million dollars last month. It was owed to creditors of National Amusements.
But this is just the latest thing.
So they're saying Larry Elison forked up a big chunk of.
The cash for I think Sherry Redstone and her family made the decision two or three years ago. This business, the Viacom powamount business is not good long term. Let's just get out sell today. She got the deal done to sky Dance, and she had a short term liquidity problem here and Larry Ellison, who's backing his son at sky Dance, says, I'll take care of that problem for you.
Here's the cash, and so that's it. She's just and she'll just ride off to the sunset and take her three hundred and fifty million dollars and do what you.
So the zeitgeist is they bolt off from Comcast, MSNBCCNBC and the rest Oxygen I love E I watch twenty four saying you okay, but they can't merge with Sherry Redstone's CBS.
There's no way.
Washington, the cable actually the cable networks could. The broadcast networks could not, So NBC, CBS because there's only for broadcast networks that they won't let for of them merge. But you can take some of the cable networks from like MSNBC USA, and you can merge that into into the new paramount whatever it is, because those are just smaller networks. Okay, And that's story number two.
Okay, I didn't even realize that. So, yeah, there's MSNBC, CNBC USA.
But not Bravo.
But not Bravo. You got to keep the housewives.
Explain why the Housewives? It's you? Is it because it makes money?
It makes my peacock streaming TV also, that's not part of it, so that'll stay with the parent company.
So I'm not sure as a as a media investor, why would I buy this new code Because I'm getting a lot of second tier cable networks that are facing the you know, the cord cutting challenges that all of traditional linear TV is facing. Where's the growth, what's the story? So this is a bad bank good banks situation. I think Comcast is simply saying, we've got a lot of good assets of Comcasts. Let's keep them in Comcasts. The stuff that is not so good will it off into it.
But Paul, they get thirty eight point eight debt at Comcast, is this where they dump all the debt?
No I the spin off?
Now the third debt is actually fine. They actually have a very good balance eet. Their net debt to EBITDA is fine. That they have a great balance sheet. Actually it's a strategic asset of the company. But they're just simply saying, we think our stock is weighed down by these cable networks, and so let's spin them off into a separate company, get it off of our balance sheet. So maybe our then existing Comcast can trade higher.
The journal thing can produce about seven billion in annual revenue. Do you think that about you?
It is, but it is that revenue growing, and I would argue it's not.
Or very low, it's very low synergy.
This is no. I think it's simply a good bank bad bank thing. I just want to get some of these assets that I know my investors do not like and get them out of my company and put them on as a standalone company.
So next, okay, we're moving on to Elon musk X. Apparently it needs to boost advertising revenue. So it's turning this is from Business Insider to an add tech company called Pubmatic. They're joining Google in moby. They're these third party vendors that allow them to sell their ads. But the thing is it's different for the company. Right, So before Musk had to take over Twitter broker deals with advertisers directly. So now you see this shift as they're turning to these like third party vendors.
To help sell us advertising.
So it really needs to make some money.
When Paul, do you know when like they when he affected this transaction.
Yeah, there was lots of debt.
Wall Street, Morgan Stanley I think was involved transactions.
Right, This is all on his personal personal balance sheet. And so now you know, this is just an opportunity for them to try to say, hey, I got to generate some revenue because I'm not. My advertising revenue is just not grown. We don't know it because it's not public, so we don't know what the revenue. But I suspect that there are a lot of advertisers have backed away from X for a variety of reasons, and this is just away from the track.
I'm looking at the pubmatic website. I can't be on that website. It's too cool for school.
The next one, quick one, okay, quick, Barbenheimer, you remember the success it did well this weekend, we're going Clicked, Gladiator and Wicked. I guess wikiator.
Doesn't quite have ring to it.
What do you think?
I think it's gonna be phenomenal because it's the same thing. You have two completely different audiences. You know, they had the Barbie and the Oppenheimer. Now you have the Wicked and the.
Glad Hollywood cheerleading.
Get the Telegraph in London crushed Wicked just rushed it.
I don't know. I don't have an opinion.
It has the big stars already in a Grande like it has. It has that pull to it Gladiator itself.
Just I mean, I readbot, Who's who's the gladiator this time?
My husband is a gladiator's playing Russell Crow.
I don't know Russell.
Oh there's that's the new guy who's playing that the younger, the son of the ship young this whole other story. Yeah, so's I already bought because it's it's been so long since the Gladiator came.
Out, you know, Paul, Paul, Yes, all right, you're on top of the time.
Already saved me, saved people that I know, this stuff always in my ear. Hey, stupid, you.
Know it works well, hopefully that'll be a big box office hoping so the estimates, Okay, they plan that it'll bring in Wicked at least one hundred million opening weekend.
They're hoping Gladiated too could bring in eighty million. And that's kind of similar to to how Barbie and Oppenheimer open.
Okaye, did we give you enough time today?
We did?
Thank you very much, Lisa Mateo. Thank you for the newspapers.
This is the Bloomberg Surveillance podcast, available on Apple, Spotify, and anywhere else you get your podcasts. Listen live each weekday, seven to ten am Eastern on Bloomberg dot Com, the iHeartRadio app tune In, and the Bloomberg Business app. You can also watch us live every weekday on YouTube and always on the Bloomberg terminal