From the heart of where innovation, money and power collide in Silicon Valley and beyond. This is Bloomberg Technology with Caroline Hyde and.
Ed Lovelung.
Live from New York and San Francisco. This is Bromberg Technology. We continue to cover the aftermath of President Donald Trump's sweeping touse, with stocks rebounding on hopes of trade deals following the biggest route in five years. I focus in on a Nazda one hundred that is up three and a half percent. Only three stocks are generally in the red on the entirety of the benchmark, as there.
Are hopes on South Korea deals, Japanese deals.
Ed.
What's from the micro perspective.
Yeah, two of the biggest technology names that are in the headlines, and that's Tesla and Micron. Tesla is based around a feud between Elon Musk and Peter Navarro. Navarro commenting on television that Tesla is not a car manufacturer, it's a car assembler, which prompted e'd On Musk to call him a moron quote and explain that actually most of Tesla's components in the car itself are filled with
items originating from the US. The stock at session highs whether that's direct who knows Micron Reuter's reporting that Micron's passing on the cost of tariffs to customers at its supply base. The market cheered that no comment or official word from Micro, and yet they have an answer, Mike call. But interesting in the market's context.
From a micro perspective to the macro mold broadly aired trade headlines. They're continuing to drive the markets, of course, with optimism building for trade deals with South Korea, with Japan, but China not backing down.
On President Trump's Pwerff threats.
Vowing to quote fight to the end as speak it all down. Blombergs, Mike Shepherd is with us very different tactics. Talk through the latest in terms of South Korea.
Well, with South Korea, they seem to be following in the steps of Japan and trying to open up very quickly negotiations with Washington on some kind of deal that would ameliorate or eliminate altogether the reciprocal tariffs that are about to take effect at midnight tonight, and those tariffs, of course, would be damaging to economies around the world and especially to the trade relationships between these two tech centers Japan and South Korea that are so important as well to Silicon Valley.
Now the mood.
Music is leading some to think what would happen with China? Is China ready to also somehow approach President Donald Trump? And the President indicated in his truth social post that he was waiting for a call from Beijing. But the move music, as you indicated, is a little bit different.
In China, They're sending mixed signals. On the one hand, they are pointing to a willingness to talk to actually have this conversation about trade, but at the same time they say that they are willing to fight to the end.
And this is in response to.
President Donald Trump's threat to impose even more teriffs on China if Beijing follows through with its pledge to keep its retaliatory teriffs in place.
Mike, I'm trying to keep this deeply focused on the technology sector, right, and it's hard to piece it together. Why are the career headlines important? One reason Career sends ten billion dollars worth of chips to the US every year. Eighty percent of the memory saw the Micron headlines from Reuter's. That's one part. The other is that China's not moving right, and that was the speculation of the last twenty four hours. How do they react? What happened overnight was really really severe.
Just recap the wording that the Chinese issued.
Well, when we think about the Chinese, they were talking about how they would fight to the end, and that really sent a signal to the markets and to investors in even to companies that we could be in this for the long haul.
And if your Apple with.
So much production, for example, eighty percent of iPhones are still made in China. Even as Apple has tried to diversify its production lines, it has been much tougher.
So the signs of a far perhaps.
With Saul and with Tokyo, do lend some optimism, especially for producers of products. You think of Sony, you think of sk Heinex, you think of Tokyo Electron and some of the more sophisticated chip making equipment that they produce. All of these things are in play, but China is really the big target here just because of the size of the economy and the amount of trade that the US does with China.
Bloombo's Mike Shepherd, it's Apple exactly where we want to go. Next shares of Apple rebounding in the session after what was basically three day biggest three day drop since the two thousands. President Trump's tariff frets sending customers to the stores. There's panic buying of iPhones ahead of speculated but potential price increases. Joining us, Bloomberg Intelligences and arag Rana. Your job is to take data, your own data, third party data,
look at the case best, worst case scenario. What do you do with data or reporting that there's panic buying of iPhones, particularly in this country.
Yeah, but the thing is that may help, you know, let's say, minor earnings in this upcoming quarter, but it doesn't take away the big risk Apple has on procuring more phones for down the road when the next iPhone cycle comes in, when the December quarter comes in. I mean, there is a lot at stake right now, especially when it comes to the size of the tariffs that may hit China.
That's so important that ultimately may first when we get their fiscal second quarter earnings unlikely to show this.
It's not going to show up until their fiscal third quarter.
And meanwhile, they try to navigate not current inventory but future supply side, maybe coming more from India.
Where is that going to help them on the margin front? How much can they rely on that?
An arat see, they can bring some phones from India, but you know there are a large portion of the pro models. India is getting a hit with tariffs. Also, we don't know if somebody finds out that, okay, they are circumventing and trying to get phones from India, we won't have an additional tariffs on that. So there is a there's a lot going on right now and then almost on a daily basis, we hear about some new tariffs being slapped and but we can remember at the
end of the day it's beIN brought. The whole target of that is to try to open more factories in the US unless there is some negotiation between the two countries. So I don't think Apple escapes this anytime in the near term.
Andra Agrana putting it plainly, we thank you from Bloomberg Intelligence for more on tech markets be brought out from just Apple to across the board.
Dip buy is emerging.
Jay Jacobs is with us black Rock US head of Thematic and active ETF. Boy, have we seen some inflows and outflows? Jay, break it down what today looks like versus the last couple of trading days.
We're seeing a bit of a relief rally here in very strong volumes and corners of the market where I think people have been looking for buying opportunities. If you look at areas like artificial intelligence, look at areas like small caps, a lot of investors have been hunting for deals in these areas, and now that they're off you know, ten, fifteen, twenty percent, it represents a really attractive entry point for
long term investors. So we're seeing people get very granular about finding targeted opportunities for these lower evaluations here.
And they therefore think that the valuation erosion that we've seen in some of these AI names, some of the chip socks in particular, that they're at the right buying price right now.
Jay, Well, there's certainly at contracted valuations here. And what we've been hearing from clients for a while is, you know, they love the AI. They see the structural disruption, they see the massive total addressable market of artificial intelligence. It was really just a question of valuations. Was a scenario that was a little too hype, to little too inflated by the markets. Now that you're seeing this price is basically twenty percent off since the beginning of the year.
Those concerns are gone.
And yes, maybe the landscape looks a little bit different, but if you still zoom out and look ten years ahead, there's a ton of conviction and artificial intelligent GIN center these valuations.
It's hard to pass over.
Jay, if the trade conflict goes on indefinitely. Is there a corner specific area of the technology industry where you do want to boost your exposure?
There is you know, we actually brought out a strategy a couple of years ago very focused on this, which is i et c's or US Tech focused ETF, and it's specifically looking to remove geopolitics from technology stocks. The tech sector has over sixty percent of its revenue coming from overseas, very globally integrated supply chains, and if you can really isolate companies that hire, build and sell in the United States, you can still get that tech exposure, that tech growth.
But try to limit.
And so and limits on the impact of supply chains.
Jay, what's in it? What names are we talking about? What specific technologies, specific supply chains do you want to go into.
Well, if you look at the portfolio today, it's actually underweighting several of the mag seven stocks that make up such a top heavy amount of the tech sector as well the communications sector. You know, a lot of those stocks are still very globally integrated, have a lot of
sales overseas. It's looking more domestically sometimes at e commerce companies that do a lot of buying and selling within the United States, some AI related companies that are doing a lot of buying and selling in the United States. But it's really kind of rewaiting the tech sector, and that top ten looks very different in a fund like ITTC than just kind of the broad tech sector.
Jay, how are you currently discussing with those of that allocating towards your funds the long term versus short term? How many are wanting to commit at this moment if they are worried about what the next headline seems to be bringing.
It's really about getting granular and taking that long term view. You know, we have seen a lot of investors again are really kind of looking for what's the targeted exposure.
That they have the highest conviction in over the next five.
To ten years, and look, you get compensated for taking equity risk, and we're seeing equity risk play out in the markets today. So if you could take that long term view, get granular on the themes artificial intelligence that people believe in over the long term, we believe they should be rewarded over over time. So you know, in many ways it's opportunity hunting, but it's also you know, behavior and behavior of touching around being invested and staying invested during turbulent times.
It's important to remind oneself that all of the things we've been spending the last two years talking about haven't ended or gone away. The AI infrastructure build out, all of the forecasts a multi year I guess fit for you when you think about construction and you think about clients, it's your conviction on whether the trajectory we were on in twenty twenty four, particularly around AI infrastructure data center continues. Do you feel that way.
I don't think there's a major shift here.
You know, tech companies are very good at planning for the long term around these very very you know, capital intensive buildouts, and so if you're building a data center today, it's because you believe.
In AI three to five years from now.
And I think What's different about this time around is you have tech companies that are flush with cash. They continue to bring in new cash through free cash flow, and they see a huge potential market in artificial intelligence. So they're excited to invest in this space. They're excited to put their capital work, and they're planning for the future. You said the word cash three times though, interesting data center,
memory chips. You guys interested in that market. We are, So we look at the entire AI technology stack for opportunities, and you know, you could kind of look at the bottom of that tech stack, starting with what is the real estate that is really hosting the digital.
Infrastructure required for artificial intelligence.
On top of that are a lot of the semiconductor companies, not just GPUs, but memory rievers. We really like that digital infrastructure area right now because that's where a lot of revenue is being channeled in artificial intelligence for the next couple of years as we see a build.
Out of AI.
Right, J Jacobs of black Rock, Really great to have you back on the program. Thank you very much. Now coming up, former US Treasury Secretary Larry Summers joins us to talk if and why he expects more turbut it's a key conversation coming up here. This is Bloomberg Technology.
Our Bloomberg audience is worldwide. I'm David Weston and I'm joined now by the former US treasure Sectory Larry Summers of Harvard. Larry, thank you for being back with us. When we talked just a week ago on Wednesday, the day of the announced of the tariffs, there was a lot yet to be determined. The markets have been through an amazing amount of volatility since then. Three down days, they're sharply up today. You've been quite explicitly critical of
what President Trump has announced here. Do you feel better today because the markets are coming back?
Sure?
I feel better anytime instability seems to be calming.
But be not confused.
There is only one reason why instability is being reduced, and that is there's a growing hope in markets that a larger part of these policies are going to prove transitory and reversible. This does not reflect any kind of
market endorsement of the approach that the President has followed. Rather, it reflects a judgment that the president might recognize the reality that markets are telling him about, that many of his advisors are telling him about that corporate CEOs across the country are articulating that this kind of wholesale tariff of policy is simply bad for economic performance. We're seeing some signs that the administration may recognize that.
We're seeing signs. But do we have a better sense of the goals in the process today than we got from the Rose Garden last Wednesday.
I don't think so. I think this is fundamentally a improvisational effort. You could tell that when you knew that there was a policy based on tariff reciprocity that didn't use any data on the tariffs of other countries in figuring out how to reciprocate. You could tell that from the blatant contradictions between what presidential Advisor Navarro was saying
and Presidential advisor Treasury Secretary Scott Bessen was saying. You could tell that from the degree of division between close outside advisor Elon Musk and many members of the president's economic team. This is a policy, it's a hugely consequential policy, but by all aheerances, it's being improvised on a daily basis,
and that's creating huge uncertainty. But it's only uncertain There's only uncertainty if things go in both directions, and today happened to be a day when things moved in a positive direction.
I hope that the moves to.
Back off these policies can continue, but we'll have to see. I suspect we're going to have volatile markets for some time to come, and no one can know, but my judgment is that I'd be surprised if the bottom is yet in with respect to this phase and markets.
How bad could it get?
Oh, I think the.
Likelihood.
I think it's more likely than not that we're going to have a recession. And in the context of a recession, we'll see an extra two million people be unemployed. We'll see losses in household income that are five thousand dollars a family or more. We are very likely, in the context of a recession, to see markets reach levels significantly below their current levels. So I think we could be
looking for fairly serious economic problems. And I think it will cash the shadow forward, because if we have a recession, the budget deficit will go up, the accumulated debt that we have to deal with will go up. They'll be financial distress that will affect higher risk companies, so higher risk countries in the global economy. But David, there's a central thing to understand about this moment of economic and financial difficulty.
To borrow a.
Word from the doctors, it is our first iatrogenic recession, our first diatrogenic financial crisis. Iatrogenic illness is when you go into the hospital and you catch an infection there. It's when the people whose job it is to make things better are the active agents of making things worse. And iatrogenic illness, staff, infections and alike in hospitals is a major preoccupation for doctors. This is an iatrogenic economic challenge. Is nothing in the outside world that is causing this challenge.
It is induced by the words and deeds of President Trump and his administration. The good news about that is it could be resolved with words and deeds of President Trump if they backed off these policy errors. I think
there would be a substantial resumption of normality. But as long as a hospital maintains unsanitary conditions, its patients get infections when they enter, and as long as these policies are being pursued, we're going to see substantial volatility and markets, substantial recession risk, substantial damage to middle class families.
So, just to follow up on that, is there any remedy for the patient other than for the chief doctor that is President Trump to back off what you just described as policy errors? Is there anybody else who can save us?
Look, depending on what happens with other countries and how they handle their diplomacy, it may be easier or harder for him to back off these policies. Depending upon how the business community responds. There may be more or less ability to create an environment where there's a backing off of these policies. But there's nothing complicated about this. You impose huge tax increases on households in an uncertainty creating way that's also damaging to established business patterns, and the
economy turns downwards. There's nothing subtle or sophisticated about this. This is introductory economics. It's the kind of question that could have been on an introductory economics exam for decades. Suppose the president of the United States decides suddenly to impose a massive tariff tax increase on products from all
over the world. What will happen to the economy? And any b student will know that the answer to that is that it's a supply shock that raises prices and raises unemployment as well and makes the economy less efficient and substantially to uncertainty. This isn't some sophisticated, complicated thing to analyze.
Larry, thank you so much for being back on I really appreciate that is former US Treasury Secretary Larry Summers of Harvard back to you.
We thank you, David weston technology shares literally just touching session lows in the last couple of seconds, and now's that one hundred down up now sorry two and a half percent. We're also seeing some current downward pressure. Bitcoins being around seventy eight thousand US dollars per token over the last three or four days. Remember it traded over the weekend. There is more buoyancy. We are rebounding, but there are many, many more tariff and trade related headlines
to digest. Don't go anywhere, We'll be right back. This is Bloomberg Technology.
Welcome back to Bluemberg Technology and Caroine hide in New York and.
I met Ladlow in San Francisco. Some markets character, yeah, let's.
Check in on them because we're coming off of our highs then as at one hundred, though still clinging to two and a half percentage point gain. We're seeing very few stocks in the red today as people start to buy this dip and hope that more trade deals might come South Korea, Japan and the mix.
Move on and have a look at a little chip stocks that I want to shine a light on because deals are actually getting done.
Marvelle's selling is auto related part of the business to Infini in the German company. We're up six point eight percent on a two and a half billion dollar deal. Broadcom buying back its shares steep discount after the recent sell off six point seven percent high as they say they're going to be purchasing some ten billion dollars a Micron interestingly reports coming that it is looking to pass on some of those.
Tariff costs to customers.
It's up too and a half percent, but let's dwell on another chip company. It also makes phones and plenty of other things. Samsung shares climbed over in London trading after South Korean tech giant reported better than expect to.
Pull in results for the fiscal first quarter.
It also comes, of course, as President Trump, so the prospects for a trade deal with Saul were looking good. Let's dig into it. Peter Elstrom is here with us still in New York. Let's go to the earnings first. The fundamentals looking good for memory in particular.
Yeah, that's right.
So Samsung reports its preliminary earnings right after the quarter closes. We'll get more detail later on, but at least the preliminary numbers were very good. Revenue was up ten percent, their operating profit was four point four billion dollars, well ahead of what analysts had anticipated. There were a couple things playing into the results here. First of all, d RAM, the legacy d RAM business is taking off quite a bit, and they have a new Galaxy smartphone out there that's
doing quite well at this point. So Samsung, at least at this point, is showing some progress. We know that they are well behind in terms of AI memory chips. They're trying to play ketchup with s k Heinex. They didn't give any detail on that today, but we may get it later on in the month.
The memory market's very interesting in how some Sung plays it right, particularly when it relates to China, because they are that they are able to currently serve customers in China until the US titans export restrictions.
Just go with that with US, Peter right, Well, the US administrations first to buy. The administration now that Trump administration has been quite concerned about some of these chips that are going into China being sold into China. In Vidia chips of course is sort of the top of the list there, but also the high end memory chips are a concern for them. So es Kehinix makes the high bandwidth memory chips, the HBM chips that are going
into China. They have been affected by this. Samsung could also get affected by this in the future.
And the goal the administration.
Is trying to cut off some of these AI capabilities that China is trying to build. In the meantime, of course, those domestic players are competing and they're trying to gain some groundback China. Samsung in particular has been struggling because they do have customers in China they want to be able to sell to. But most importantly for them, they want to get verified by Invidia so that they can sell the HBM chips that Nvidia needs for their AI capabilities.
Bloombogs Peter Elstrom, thank you very much. Let's get more on how technology investors are reacting to all of the market turbulance. Beth Kindig, lead tech analyst that Io Fund, joins us now and BEV really grateful to have you on the show. I enjoy the kind of breadth of your commentary on x Actually some of it tariff and markets focused. A lot of it actually the underlying technology.
But given the markets that we find ourselves in right now, what's your latest thinking on the technology sector and how you're going to play the uncertainty of a trade war.
Yeah, Look, nobody holding stocks right now is comfortable, especially tech investors. Tech will overweight impact from tariffs. Who whether's the electronics, the data center equipment. We're talking hundreds of billions and imports every year that could be impacted. Ultimately, though, the market can top on good news and it can
bottom on bad news. Meaning we're seeing SMH Semiconductor at ETF up five percent despite the threat of up to one hundred percent or higher tariffs in China not confirmed, but we've seen some activity over the weekend in that regard. What that means is we are positioned for a bounce. We think that we're in.
Extreme over sold conditions.
If you look at the sentiment reading retail has almost never been so bearished. It's retail is more bearished than COVID and more barrished in two thousand and nine. What that means is the market is over sold. We are positioned for a bounce, and that bounce may or.
May not.
Continue onward.
Meeting, we still remain cautious even with position for a bounce.
So forgive me, Beth, Have we or have we not hit the bottom in tech?
We have unlikely, It is not likely we've hit the bottom through all of the damage that was done last week and the damage that we could see this year.
So, Beth, we tend to you when iofund has performed most benchmarks for the last couple of years, and indeed a lot of the other tech focused funds, do you make the most of these valuations, just go very focused on individual names and just withstand the volatility, or do you wait for a better outcome?
Do you wait for more clarity from president?
It's a little bit of both. We layered in on Friday and Monday.
The reason is we it's clear to us probability favors that bounce. That bounce is very important for a tech investor because of the damage that was done. You have to capture that bounce if you're going to compete on an annual basis like my firm, and therefore capturing that balance is key.
De Risking on a bounce rather.
Than during capitulation is everything to a tech investor being very strategic, So de risking on that bounce is key to the performance this year.
It's interesting Besson close Treasure Sectory has time and time again said this isn't a MAGA problem, this is a MAG seven problem. Then, as that peaked back in February, this is actually about deep seek and to that point, we've seen pressure on chip stocks running into this tariff crisis. We were worried about an AI infrastructure bubble. How much have you been paying credence to that or was the market getting that wrong too?
It is a MAG seven problem.
We hold very few MAG seven stocks because of the outside.
Spending on cap X.
You have to think about is the schedules for depreciation on servers is that even accurate? Is it really going to be a five to six year depreciation schedule?
That matters because if it's not, and it's it's.
More brief due to these blackwall systems coming out, and then Blackwell Ultra and then Reuben. You know, we can see more effects on the bottom line, meaning they're the customers. That is not typically the way the Mag seven was constructed, and that piece is important to understand. There's a shift in how big tech was the producer, but now it's the customer.
I saw you say on X the other day that Ai needs compute and when it comes to compute and video is the gold standard. So if you don't hold many Mag seven names, do you hold in Vidia? How do you see Nvidia's ability to continue its trajectory in this environment?
In Vidia is the exception.
Video is the beneficiary from all of this CAPEX very low China exposure. There's a seventy conductor exemption to the tariffs.
Of course there would still be there would still.
Be some impact, but by far the safest stock in the market today is in Vidia.
Currently trading more than five percent higher. Beth Kinnig, great to have you on the show, lead tech analyst and the Iofund.
We thank you.
We have some breaking news for you at the moment, and this time it's not on tariffs, but we understand that hackers have indeed been spying on one hundred bank regulators emails for over a year.
Ed, we're going to be delving into the details.
I know you've got the story in front of you at the moment, But hackers spying on one hundred bank regulators' emails for over a year, just showing the extent to which technology has been lapsing key overseers here.
Yeah.
The Bloomberg reports that site sources basically says that the hackers had access to the deliberations of regulators who are deliberating information about the banks they oversee. Clearly, it's a deep report. One hundred and fifty thousand emails from June twenty twenty three until they were discovered earlier this year. We'll get with the team that broke that story. It seems like a big one that's sarting to have repercussions from Bloomberg Tech Newsroom. There's a lot more happening in
the world as well. Elon Musk took to x to criticize President Trump's top trade advisor Pete Navarro, calling him quote a moron. This was in response to Navara's comment that Musk is a car assembler rather than a car manufacturer. That also comes after Elon Musk's younger brother, Kimball Musk, criticized President Trump's tariff strategy, calling them a quote structural permanent acts on the American consumer. Bloomberg's Curra Coulson is in Austin, Texas and has the fortunate job of untangling
all of that. I think we should start with the feud between Navarro and Musk. And actually, if you look at the data third Party or Tessa Zone, there is support for what Elon Musk is saying that vehicles built in the United States source components from the United States, are assembled and manufactured in the United States sort of knows the tail.
Yeah, definitely.
You know, this is something that Tesla's been promoting for a while. They say promotions frequently in the last few months that are you know, Tesla's are American made. They know this is something and simmers they are looking for as they get concerned about Tariff's.
Something they've been touting.
And you know, Elon Musk hasn't directly said anything on Trump's policies, but he has been speaking out against tariffs. He's been saying the tariffs, Trump's tariffs as well will impact Tesla you know, they're not completely insulated, even as he acknowledges that Tesla is, in his opinion, more American made than other cars.
Carl What we're trying to pass here is what is happening in an administration, in a White House level, and who has the air of President Trump, and on tariffs, it feels as though Elon has not. In fact, he goes as far as to not just call Peter Navarro a moron, but calling him dumber than a sack of bricks. I mean, it feels as though he's pushing against the flow the trajectory here.
Yeah, over the.
Weekend, you know, Elon Musk did push back on just the concept of tariffs alone.
He was saying, you know, he boughts.
More of a free open trade between Europe and the US. He's he is definitely more pro free market, and it's something he has said.
Before in the past.
And while Tesla was initially seen as kind of an initial winner in the tariffs where it'd be less affected, you know, executives have said there is expected impact from tariff's aunt Tesla.
Kyral Carlson breaking it down, We thank you. Meanwhile, let's just think about President Trump's tariff uncertainty changing the minds to some of the biggest bills on Wall Street. Dan Ives webbush slashing his Apple and Tesla price targets, writing, these tariffs are so absurd, scary, uncertain to anyone that has a basic understanding of the global supply chain and the way US tech companies operate and US consumers live
their daily lives, dan Ives joins us. Now, you also wrote in your Tesla piece that Elon must needed to step up.
If he needed to lead. Is this him leading?
Is this him stepping up, pushing back against Peter Nevara.
Look, I mean it's our view. Musk basically needs to leave the government. I mean because if you look at the brand damage, you just cannot deny it. I mean, I think there's twenty percent actually permanent brand damage in Europe, ten percent of the least in the US. And he's pushing back because look, Musk, he's getting calls from Fremont, from Arsten, from what he's hearing in China and in Jeremy. No one's probably more plugged in along with you, Nadella,
and along with Jensen obviously Cook than Musk. So he knows tariffs it's a disaster across the board, and it's our view it sends the tech industry back a decade if these tariffs actually hit.
And on the other hand, Tesla's more insulated than the others on tariffs, right. So what I tried to distinguish in your note is those forecasts you gave on demand loss. You said ten percent globally, but more severe in China in the EU. That's not really a tariff's issue, right, It's a reputational issue of Musk's association with Trump. Just explain your modeling.
Yeah, I mean ed, Unfortunately, Tasso has become a political symbol around the world, but in a bad way, right. I mean, if any frustration toward Trump douge tariffs globally, there's one symbol, it's Tesla, and your Musk obviously went into the government, you know, in terms of Doge and everything we've seen and we've talked about, it's a leaks
one hundred hour overhanging the stock. And I think when you look at trying to model it, there's brand damage, there's tariff issues, and you're just trying to take stabs at it. I mean, they just came off of a disaster one queue delivery number and you know, somebody, it's been such a long term bull and remember we didn't lower our rating, still maintain our bullshes on an autonomous
on rebox in the future of Tesla. In my view, it's been it's been a sad few months to watch it because it's brand destruction by the hour, by the day.
Can't deny it, Dan, can't deny it.
But as you say, you're still overweight and you still see maybe twenty eight percent upside from here.
So what is the recovery process here?
Because it takes a long time to build brand and very quick to destroy it.
There's three things. One, he has to leave government. So when you look at what's happened in Navar, like you know, investors will wonder like it's just the first step in terms of stage left, and we've talked about it's a key sixty ninety days ahead. Two. If that happens, you have brand damage. Some of that's permanent, but it's a scar, it's a black eye. It stitches, but it doesn't change the long term view of Tesla in terms of autonomous robotics in the broader future. The third thing is it's
investors understanding like what the game plan is here? You have bid that's rising as a competitor global and you can in Rosecar Glass to say it, they're not you need a CEO Musk in that seat as CEO of Tesla. You can't be spending five percent, three percent, two percent of your time there and the rest of the government. That's been the frustration because Musk is Tesla.
Tesla is Musk, But what does he bring out to compete against BYD when he doesn't want to erode from a price point, Everyone feeling that it would be cannibalizedation if you brought back a much lower price competitor to a Model three for example, where does he go the cyber truck isn't selling.
Yeah, but our view is that ninety percent of the value of Tesla going forward is autonomous robot It's about unservised FSD in Austin. It's about launching everything robotech. When you when you look into the next year of cybercaps that they could do a core scale production. And I think that's why, like when you look at these tariffs, Tesla, Apple, Gimp could go across the board. It cuts the legs off of US tech and that's been why you know, it's just such a very frustrating uncertain time.
Dan I got a question from the audience on X from Mark Munro who asks if tech companies are removing guidance. I think he means will they remove guidance?
Oh yeah, I mean any tech company that gives guidance, I'd be shocked because right now it's blindfolded darts. You don't know where guidance is going to go. And that's but it speaks a point. We're gonna have rallies. You see number cuts, and we've tried to cut some numbers. Other analysts have as well. But I mean the one you put these tariffs in when it comes to China Taiwan, then ultimately you're gonna have to toss out two Q numbers.
You're gonna toss out three Q numbers street assuming it's some sort of three to six month trade battle, you know, then they'll basically look at what did twenty twenty six numbers look like? And that's how investors are going to ultimately when you look like worst case, base case, best case, all the thing that we're talking about, investors around the world,
you know, over the last called seventy two hours. That's where you look at n video, what's baked in, what's baked into Microsoft worst base right, barecase.
I's a web bash.
Thank you very much, appreciate its.
Breaking use crossing the bloem bg terminal. The Supreme Court has backed President Trump for now in the issue of federal worker firings. It's a case that's being discussed as part of the broader initiative of layoffs and voluntary redundancies. Voluntary the DOGE is undertaking. The wording of the headline is for now, Caroline indicating I think that it's a temporary judgment and that there's more to come on waiting for the story to hit the terminal as well, but
it's one that we're watching closely. There's another big story happening in our world on bluebog technology, and that's private markets. It was supposed to be the year for IPOs among venture catalysts and startups. Instead, President Trump's tariffs have put a pause on any ambitions to go public, with the likes of StubHub and Klana pulling back on their plans. Bluemost Katie Ruth joins us and you summarize the anxiety that's out there, the panic brilliantly in the peace out overnight.
I'd be honest. When I woke up, I got text messages from both sides. Some said paralysis, some said there's some panic happening, but people are moving. Summarize your reporting.
Sure, other than Trump's strongest supporter is most of Silicon Valley. Most vcs we talked to very upset about this. You know, basically there's two issues here. It's delaying some much needed IPOs due to market volatility, and then also could bring higher costs to some of their businesses, depending on the business line. But as you know, there haven't been a lot of IPOs for three years, and this is supposed to be that quarter.
LPs getting pretty anxious and leaning on the vcs, Katie, But what about current funding rounds. Are there any areas where, particularly in the AI space, companies are still able to raise.
Sure and so normally there's a lag effect, you know, from public market volatility to private markets. Wh It takes a few months for things to trickle down at each stage. But you know, I think it partly also depends on the sector. Obviously, if there's a direct business impact if anything, you know, if their revenue could be hit by this, if their costs could go up because of this due to international trade, those things are going to have a tougher time fundraising right now, or at least at the
terms that they thought they could get. But you know, if it's something that's not directly impacted by the tariffs, then you know, you may see things remain relatively constant from a fundraising perspective, unless there's a broader issue with the market, although it seems like it's kind of resolved a little bit so far.
Jake Saper, who you quote from Emergency Capital, we're trying to triage and figure out. Katie Ruth, thanks so much for that story. And let's talk about one area where a company is potentially move.
Mickey moves. Billionaire Michael gonovogratz Ha's got his wish.
His crypto conglomerate, Galaxy Digital Holdings Limited, has received permission for a direct listing on the Nasdaq Stock Exchange. Finally, this company can trade in the United States as well as in Canada, where we're exsuming. Trading is expected to actually happen pretty shortly ed after a special shareholder meeting on May ninth.
The company has said all of this in a press release.
This is the US Justice Department will limit the kinds of cryptocurrency crimes it will investigate and prosecute. We've got a memo. The DOJ said it will focus on cases related to terrorism, drug cartels, victimizing investors, and other limited categories. One story will continue to track Carrot throughout the year.
Yeah, all things on Crypto News. Crypto Show coming up twelve pm at Eastern time. But that does it for this edition of Bloomberg Technology. Check in on the markets as we continue to rally today as a Bloomberg Technology