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Markets, Cannabis, And Rivian (Podcast) · Bloomberg Intelligence

• 0:00
  Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney alongside
• 0:04
  Speaker 1: my co host Matt Miller. Every business day we bring
• 0:06
  Speaker 1: you interviews from CEOs, market pros, and Bloomberg experts, along
• 0:11
  Speaker 1: with essential market moving news. Find the Bloomberg Markets Podcast
• 0:15
  Speaker 1: on Apple Podcasts or wherever you listen to podcasts, and
• 0:18
  Speaker 1: at Bloomberg dot com slash podcast. I want to bring
• 0:22
  Speaker 1: on Veronica Willis. She's a vice president investment strategy analysts
• 0:25
  Speaker 1: at the Wells Fargo Investment Institute. Franca, I'm guessing you're
• 0:30
  Speaker 1: having some I guess interesting calls with your clients here
• 0:34
  Speaker 1: as these markets sell off here and uh during this
• 0:37
  Speaker 1: first four and a half months of two gives a
• 0:41
  Speaker 1: sense of kind of what your clients are asking you
• 0:43
  Speaker 1: and maybe wait, wait what you're telling them? Absolutely, you're right.
• 0:48
  Speaker 1: We get calls all the time really concerned about inflation.
• 0:53
  Speaker 1: Have we seen the peak in inflation? What are we
• 0:55
  Speaker 1: expecting to happen with inflation? And then also, you know,
• 1:00
  Speaker 1: what should I do as a client when fox are
• 1:03
  Speaker 1: down and bonds are down together? Where can I go?
• 1:06
  Speaker 1: And so I'll kind of start off with looking at inflation.
• 1:11
  Speaker 1: It might be a little bit too early to tell
• 1:13
  Speaker 1: whether or not inflation is peeped. With cp I we
• 1:16
  Speaker 1: saw a little bit of a slowdown from the previous month.
• 1:19
  Speaker 1: The same with p p I, but both a little
• 1:21
  Speaker 1: bit higher than what analysts were expecting, and so that's
• 1:24
  Speaker 1: something we really want to watch really closely with those increases,
• 1:28
  Speaker 1: especially in the services areas where inflation might be a
• 1:31
  Speaker 1: little stickier than many of us expected. And so inflation
• 1:36
  Speaker 1: is something we're watching closely over the next eighteen months.
• 1:39
  Speaker 1: We think inflation can remain um above those long term
• 1:43
  Speaker 1: averages through three before sort of returning to more normalized level.
• 1:52
  Speaker 1: That's next year, Paul, I know where we're thinking about.
• 1:56
  Speaker 1: We're thinking about next year, and you know, we really
• 1:58
  Speaker 1: want to try the guy our clients to that longer
• 2:01
  Speaker 1: term perspective, especially if they're in longer term plans, to
• 2:06
  Speaker 1: not make rash decisions because of the short term volatility
• 2:10
  Speaker 1: and to really stick to that long term plan. Well,
• 2:13
  Speaker 1: recently in our vice, our allocation advice, we've brought a
• 2:18
  Speaker 1: little bit more neutral with our stocks. If you have
• 2:21
  Speaker 1: if you have a longer term perspective Veronica um and
• 2:26
  Speaker 1: you're worried about inflation that far out do you, you know,
• 2:32
  Speaker 1: start getting into stocks now, assuming you just hold out
• 2:36
  Speaker 1: or start adding to your position now if you've already
• 2:38
  Speaker 1: got it just because you have a longer term position. Okay,
• 2:42
  Speaker 1: we've taken a lot of pain, but and and there
• 2:44
  Speaker 1: may be more to come. Um, but do you think
• 2:47
  Speaker 1: stocks are a good way to head against inflation? Absolutely,
• 2:51
  Speaker 1: That's exactly what we've been telling our clients. If you've
• 2:55
  Speaker 1: got a targeted allocation to your equities, you want to
• 2:58
  Speaker 1: make sure that you are moving back into equities during
• 3:03
  Speaker 1: these down terms. If you're a long term investor, you
• 3:06
  Speaker 1: really want to make sure that you've got that allocation
• 3:08
  Speaker 1: set up the way that you intended it so that
• 3:11
  Speaker 1: when markets start to recover, you're able to recover quickly
• 3:15
  Speaker 1: and not be over allocated in the less risky areas
• 3:19
  Speaker 1: like bonds. And it's hard to weather that short term volatility,
• 3:23
  Speaker 1: but if you're thinking out to that long term, you've
• 3:26
  Speaker 1: got to keep that perspective and make sure that that
• 3:28
  Speaker 1: allocation is set up so that you can, you know,
• 3:33
  Speaker 1: recover quickly when markets eventually upswing right and Veronica, what's
• 3:38
  Speaker 1: the Wells Fargo economic call? Are you guys calling for
• 3:41
  Speaker 1: a recession? Because I'm sure you know a lot of
• 3:42
  Speaker 1: folks are concerned that maybe this federal reserve may go
• 3:45
  Speaker 1: a little too fast, too quickly, and in fact push
• 3:48
  Speaker 1: this economy into a recession. What do you guys think
• 3:51
  Speaker 1: about that? Here in the US, we are expecting economic
• 3:56
  Speaker 1: growth this year um and economic growth next year, but
• 4:01
  Speaker 1: at lower levels than what we were expecting before. So
• 4:05
  Speaker 1: our base case is slowing economic growth, but we're acknowledging
• 4:09
  Speaker 1: that the risks of the recession are rising. It's something
• 4:11
  Speaker 1: that we're watching very closely, especially looking at the consumer
• 4:15
  Speaker 1: spending data. That's something we'll be watching very closely. We've
• 4:18
  Speaker 1: seen weakening consumer sentiment not yet spill over into weakening
• 4:22
  Speaker 1: weaker consumer spending, but that's something that we're keeping a
• 4:26
  Speaker 1: close eye on because that's a huge driver for the U.
• 4:28
  Speaker 1: S economy. What do you think about the moves that
• 4:34
  Speaker 1: we've seen in crypto? How much does it matter to
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  Speaker 1: you know, real investors, to to your clients, um, because
• 4:41
  Speaker 1: they're making huge headlines and it's like watching a train
• 4:44
  Speaker 1: wreck here in slow motion, but we're not seeing much
• 4:47
  Speaker 1: contagion into the you know, playing vanilla uh financial assets
• 4:55
  Speaker 1: right now, we don't have any kind of recommended allocations
• 4:59
  Speaker 1: in crypto, and so we kind of guide our investors towards,
• 5:04
  Speaker 1: you know, a stock bond and then if you've got
• 5:06
  Speaker 1: exposure in real assets you like um commodities right now
• 5:11
  Speaker 1: in the longer term perspective, and so that's sort of
• 5:14
  Speaker 1: where we're kind of guiding our clients towards those types
• 5:17
  Speaker 1: of assets as opposed to something like crypto. N I
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  Speaker 1: guess a lot of folks are saying, you know, stagflation
• 5:25
  Speaker 1: is probably the bigger risk than recession. And you know,
• 5:28
  Speaker 1: so we got you got inflation, which we do. You
• 5:30
  Speaker 1: have slowing growth with which we do. Is that something
• 5:34
  Speaker 1: that you're talking to your clients about. It's it's a
• 5:38
  Speaker 1: question we've gotten sometimes just what will you know the
• 5:42
  Speaker 1: slow growth and this higher inflation. Mean, we do recognize
• 5:47
  Speaker 1: that inflation should remain higher than are those longer term
• 5:51
  Speaker 1: averages in the near term, but we are expecting it
• 5:54
  Speaker 1: to slow. So it's a risk, but it's not our
• 5:58
  Speaker 1: our basic case, it's not our base risk that we're
• 6:00
  Speaker 1: seeing right now. We're a little bit more concerned about
• 6:03
  Speaker 1: the flowing and economic growth. All right, ron Kay, thank
• 6:07
  Speaker 1: you so much for joining us. Appreciate getting your thoughts
• 6:10
  Speaker 1: here on these markets. Ronica willis investment strategy analyst at
• 6:14
  Speaker 1: Wells Fargo Investment Institute. Check out with Robert Teater, head
• 6:22
  Speaker 1: of Investment Policy and Strategy Group at Silver Crest Asset Management. Robert,
• 6:26
  Speaker 1: you know in the wall of worry that is out there,
• 6:28
  Speaker 1: there are increasing number of bricks here, most recently, I guess,
• 6:32
  Speaker 1: geopolitical risk. Are there any positive science out there that
• 6:36
  Speaker 1: might support this market at some point? I think that's
• 6:39
  Speaker 1: a great question. There are a massive number of bricks
• 6:42
  Speaker 1: in that wall of worry. I think most of them
• 6:43
  Speaker 1: have been reasonably well factored into the market here. In
• 6:46
  Speaker 1: other words, they're pretty well known. But I think the
• 6:49
  Speaker 1: most important item to crack some of this downside momentum
• 6:52
  Speaker 1: is is solving some of those problems and solving some
• 6:54
  Speaker 1: of those bricks. And the and the most important of
• 6:56
  Speaker 1: all the bricks, of course, is inflation. And so that's
• 6:58
  Speaker 1: where we take a bit of a deeper. I've and say,
• 7:00
  Speaker 1: you know, what's going on with these metrics and inflation,
• 7:02
  Speaker 1: and are we starting to see some glimmers of hope?
• 7:04
  Speaker 1: And I think we are, and so hopefully that will
• 7:07
  Speaker 1: start to be reflected going forward in prices. Where are
• 7:09
  Speaker 1: you seeing glimmers of hope? Yes, there there aren't a lot.
• 7:13
  Speaker 1: So from the very beginning of the inflation problem, we've
• 7:15
  Speaker 1: asked ourselves three questions, which is inflation, is its spiking,
• 7:19
  Speaker 1: is it's spreading, and is it's sticking around? Clearly, it's
• 7:21
  Speaker 1: been sticking around for a long time. It has spiked
• 7:24
  Speaker 1: quite a bit, although perhaps it's starting to slow a
• 7:26
  Speaker 1: little bit as the month over month eatings have come
• 7:28
  Speaker 1: in just a little bit lighter than prior months. And
• 7:31
  Speaker 1: then to the question of is it's spreading, We've done
• 7:33
  Speaker 1: some analysis around all the categories within c p I,
• 7:36
  Speaker 1: looking at where they sit versus their three year pre
• 7:39
  Speaker 1: COVID average, and we've seen a slight decline in the
• 7:42
  Speaker 1: number of categories that are showing inflation above that prior
• 7:45
  Speaker 1: historical average. It's only slight, so you know, there's still
• 7:48
  Speaker 1: seventy categories above the three year average, but that's down
• 7:52
  Speaker 1: from in prior months. So we'll see if this trend
• 7:57
  Speaker 1: continues a little bit for inflation at least perhapsing and
• 8:00
  Speaker 1: maybe easing a little bit in coming months. Robert, are
• 8:03
  Speaker 1: you are you in the camp that believes that the
• 8:05
  Speaker 1: federal reserve can materially rain in inflation. I'm not sure
• 8:09
  Speaker 1: i am, because it just feels like it's so much
• 8:10
  Speaker 1: more supply side driven to the all the supply chain
• 8:14
  Speaker 1: challenges that have developed over the actual economy. Though, Yeah,
• 8:17
  Speaker 1: that'll do it, but that's not we're looking for. How
• 8:21
  Speaker 1: do you think about the FEDS ability, Robert to to
• 8:23
  Speaker 1: kind of get a handle on inflation, right that and
• 8:26
  Speaker 1: that is the blunt tool instrument, and I think that's
• 8:28
  Speaker 1: partially what investors are starting to worry about here. Like you,
• 8:30
  Speaker 1: I share the view that inflation is a pretty complex
• 8:32
  Speaker 1: problem here. A lot of it is related to supply
• 8:35
  Speaker 1: chains and whack the mole problems and a lot of
• 8:37
  Speaker 1: different things going on um Clearly, one area though, where
• 8:40
  Speaker 1: the rate hikes transmit pretty quickly is in the fact
• 8:43
  Speaker 1: that you know, we've seen rates of all types go
• 8:44
  Speaker 1: up pretty quickly, especially for things like mortgages, and with
• 8:47
  Speaker 1: housing being a big part of cp I, that will
• 8:49
  Speaker 1: hopefully start to moderate some of the price increases that
• 8:52
  Speaker 1: we're seeing in the housing market and transmit to a
• 8:54
  Speaker 1: little bit more stability and pricing overall. But as for
• 8:57
  Speaker 1: the other increases, those are related to a lot of problem,
• 8:59
  Speaker 1: solve thing that needs to go on industry by industry.
• 9:02
  Speaker 1: So what is an investor to do right now? Especially
• 9:05
  Speaker 1: if UM we are in a position where markets are
• 9:08
  Speaker 1: going to just sure and lower and lower UM. Where
• 9:13
  Speaker 1: where does an investor go? Well, I think one of
• 9:16
  Speaker 1: the things here that's really important is to try to
• 9:18
  Speaker 1: focus on time horizon and that's not easy to do
• 9:21
  Speaker 1: when markets are sometimes going up and down three, you know,
• 9:24
  Speaker 1: one day after the other. But I think it is
• 9:26
  Speaker 1: really these are going down three one day after the other.
• 9:29
  Speaker 1: They have been and there's been there's been a few
• 9:30
  Speaker 1: that have been up. But I agree it is a
• 9:32
  Speaker 1: very choppy environment and I think it's I think it
• 9:34
  Speaker 1: is likely to stay that way. It's not an easy
• 9:37
  Speaker 1: environment to make some changes in though, because I do
• 9:39
  Speaker 1: think that the longer term fundamental backdrop is still pretty sound.
• 9:42
  Speaker 1: So forecast for the economy are still for pretty decent
• 9:45
  Speaker 1: growth New York FED at at four percent or so,
• 9:48
  Speaker 1: Earnings came in pretty solid this quarter, and the outlook
• 9:50
  Speaker 1: going forward is pretty solid. So I think the underlying
• 9:53
  Speaker 1: fundamental picture is still very decent, if not good, But
• 9:56
  Speaker 1: it's in this macro environment that's been very difficult and
• 9:59
  Speaker 1: The challenge there of is we don't know the timeline
• 10:01
  Speaker 1: exactly when those problems will change, but when they do,
• 10:03
  Speaker 1: those clouds will start parting. And I think what we
• 10:05
  Speaker 1: see behind it is is a pretty good backdrop again
• 10:08
  Speaker 1: for the economy and earnings. Is it even worth your
• 10:11
  Speaker 1: time and analysis and investors time and analysis to try
• 10:13
  Speaker 1: to get a sense of where the bottom is? Are
• 10:16
  Speaker 1: there any valuation calls to be made? Is there a
• 10:19
  Speaker 1: volume call to be made where you say, Okay, this
• 10:22
  Speaker 1: feels like the bottom. Yeah, that's never easy to do.
• 10:26
  Speaker 1: Certainly evaluations come in quite a bit, so that's a
• 10:28
  Speaker 1: bit compelling. Um. I think sentiment has gotten to the
• 10:32
  Speaker 1: sort of maximum awfulness, So that's potentially another sign that
• 10:35
  Speaker 1: we could be nearing a bottom. And the thing that
• 10:37
  Speaker 1: I'm really looking for is when do we see any
• 10:40
  Speaker 1: change in the things that have caused the momentum to
• 10:43
  Speaker 1: the downside to really build? And again, in my mind,
• 10:45
  Speaker 1: there's really only two ways to break that downside momentum.
• 10:48
  Speaker 1: One is to see some improvement in inflation, the biggest
• 10:50
  Speaker 1: brick in the in the wall of where as he
• 10:52
  Speaker 1: were saying, And the second would be if we get
• 10:54
  Speaker 1: the passage of time and a little bit of stability,
• 10:56
  Speaker 1: and investors again are allowed to you know, enabled to
• 10:58
  Speaker 1: look forward a bit and look at the picture that's
• 11:00
  Speaker 1: headed over the next six quarters or so when we
• 11:02
  Speaker 1: think the earnings backdrop is good. So either of those
• 11:04
  Speaker 1: two things I think would turn the tide of it.
• 11:06
  Speaker 1: It's a pretty challenging and unpredictable environment right now. Do
• 11:09
  Speaker 1: you like any alternative assets? I mean, with your hedge
• 11:11
  Speaker 1: fund history, where are you hedging? Yeah, no, that's a
• 11:16
  Speaker 1: good question. It should be a good environment for a
• 11:19
  Speaker 1: number of different types of alternative investments, partly because of
• 11:22
  Speaker 1: the time horizon function and partly because of the ability
• 11:25
  Speaker 1: to hedge out some market risk. We do think that
• 11:27
  Speaker 1: stock selection plays a really key role here, So strategies
• 11:30
  Speaker 1: like long short equity or active equity management on the
• 11:33
  Speaker 1: on the public market side, um, we like a lot
• 11:35
  Speaker 1: because we think again that problem solving is happening industry
• 11:38
  Speaker 1: by industry, company by company having to deal with the
• 11:41
  Speaker 1: myriad of issues that have come up as a result
• 11:43
  Speaker 1: of COVID and supply chain challenges and staffing challenges, and
• 11:46
  Speaker 1: we could go on and on with the challenges, but
• 11:48
  Speaker 1: companies solving those, we think sets up very well for
• 11:50
  Speaker 1: stock selection here, all right, Robert here, thank you so
• 11:53
  Speaker 1: much for joining us. Good good stuff there, Robert Teeter,
• 11:56
  Speaker 1: head of Investment Policy and Strategy Group of Silver Crust
• 11:58
  Speaker 1: Asset Management. Now, let's get to marijuana. Kim Rivers joins
• 12:05
  Speaker 1: us chair and CEO over at true leave UM and
• 12:10
  Speaker 1: can tell us, first of all, what exactly you're doing
• 12:14
  Speaker 1: in the industry. You're growing? Are you an intermediary? Are
• 12:18
  Speaker 1: you selling? What's true leave do sure So truly is
• 12:23
  Speaker 1: a multi space operator. We operate in eleven markets across
• 12:27
  Speaker 1: the US. We have a very large fut print with
• 12:31
  Speaker 1: the largest retail supprint of a hundred and sixty five
• 12:33
  Speaker 1: retail locations and over four million square feet of cultivation
• 12:37
  Speaker 1: and processing, which allows us at the scale to manufacture
• 12:41
  Speaker 1: over SKUs that we distribute through both retail and wholesale channels.
• 12:45
  Speaker 1: All right, So, to me, the most interesting thing complex
• 12:49
  Speaker 1: and difficult in the cannabis industry right now is UM
• 12:53
  Speaker 1: identifying strains and translating that to the consumer. I just
• 12:59
  Speaker 1: watched eight documentary CBD Nation and talked about UM, the
• 13:03
  Speaker 1: fact that certain strains can shrink tumors, fight Alzheimer's. UM
• 13:09
  Speaker 1: do all these amazing things, but you've got to have
• 13:11
  Speaker 1: the right ratio of THHC to cb D as well
• 13:15
  Speaker 1: as the right turpenes um and it gets so difficult.
• 13:19
  Speaker 1: How do you do that? Yeah, well we think that
• 13:22
  Speaker 1: obviously communication through brand is uh, you know where the
• 13:26
  Speaker 1: future of cannabis and certainly something that we're very focused on. UM.
• 13:30
  Speaker 1: You're speaking about, you know, both ratio in terms of
• 13:33
  Speaker 1: different CANNABINALT components of products. There's a lot of work
• 13:36
  Speaker 1: and we're doing a lot of work right now on
• 13:37
  Speaker 1: the R and D space around UM, you know, formulations
• 13:41
  Speaker 1: of specific products to address specific concerns. But really it
• 13:45
  Speaker 1: comes down to you know, basic brand building and basic
• 13:48
  Speaker 1: basic communication and matching brands UM with needs skates across
• 13:54
  Speaker 1: markets at the correct value propositions. So UM, you know,
• 13:57
  Speaker 1: certainly there's exciting work that's going on in the annabis
• 14:00
  Speaker 1: arena UM and we're we're friend and center in that
• 14:02
  Speaker 1: work across That's just what we're doing in our eleven markets.
• 14:06
  Speaker 1: So what are the brands UM out there. I'm not
• 14:09
  Speaker 1: as familiar with the flower as I am with the edibles,
• 14:11
  Speaker 1: but you've got conna Um, You've got plus you've got
• 14:15
  Speaker 1: Kiva that are big players. What brands are you are
• 14:18
  Speaker 1: you running? Yeah? So I mean on the edible front, right,
• 14:22
  Speaker 1: we have we have see Talk that we run in house.
• 14:24
  Speaker 1: We launched that that suite of products UM earlier this
• 14:28
  Speaker 1: year across UM again across our home markets. We also
• 14:31
  Speaker 1: have a brand partnership with with Banging in the edible space. Uh.
• 14:35
  Speaker 1: When we look at our wellness, health and wellness brands,
• 14:38
  Speaker 1: we have Momenta Ethanson who is the Survivor winner and
• 14:42
  Speaker 1: just completed the Boston Marathon as a brand ambassador for US. Uh.
• 14:45
  Speaker 1: He actually completed the Boston Marathon utilizing our products as
• 14:48
  Speaker 1: part of his regimen. Uh, so that was very exciting.
• 14:51
  Speaker 1: We have, certainly on the flower side, our premium flower
• 14:54
  Speaker 1: Strange Streams are cult of our collection which have to
• 14:58
  Speaker 1: your point communicated benefits of higher level PC but also
• 15:02
  Speaker 1: a higher level of turpene and flavonoid profiles which have
• 15:05
  Speaker 1: been very very well adopted in our markets. So again
• 15:09
  Speaker 1: it's important to have brands across segments. Muses our our
• 15:12
  Speaker 1: concentrate line again for folks who who are are concentrate
• 15:16
  Speaker 1: users UM and you know it's UM. We've got also
• 15:20
  Speaker 1: a partner with Blue River, which is a solventless company
• 15:23
  Speaker 1: who's doing some exciting work on the solventless side of things.
• 15:26
  Speaker 1: But um, really I would stay going back to edibles.
• 15:29
  Speaker 1: One of the things that we've really been focused on
• 15:31
  Speaker 1: in edibles is not only, of course, great tasting products
• 15:34
  Speaker 1: UM that are consistent, but also adding in additional nanoformulations
• 15:38
  Speaker 1: fast act. Yeah. Act. That's the key, Paul, because you
• 15:42
  Speaker 1: don't want to you don't want to take an edible
• 15:44
  Speaker 1: and think, like a half hour later, this isn't working.
• 15:47
  Speaker 1: Then you eat another one only to realize that was
• 15:50
  Speaker 1: too much. Right, So the key this nanotechnology. So what's
• 15:54
  Speaker 1: the key again, I'm ready. There's a nanotechnology that helps
• 15:57
  Speaker 1: it helps you get hit, get get the hit of
• 15:59
  Speaker 1: its master so that you know, you know how your
• 16:02
  Speaker 1: dose should be exactly. Hey Kim, where are we with
• 16:08
  Speaker 1: kind of the state by state cannabis legislation? How broad
• 16:13
  Speaker 1: is this? Like? How many states can cannabis be recreational sold? Uh? So,
• 16:19
  Speaker 1: I mean currently recreational cannabis UM is available UM in
• 16:24
  Speaker 1: you know, less than half of the states, but that's
• 16:26
  Speaker 1: certainly increasing and we expect to increase that to increase
• 16:29
  Speaker 1: over time. We've got large parts of the country, particularly
• 16:32
  Speaker 1: in the southeast, and then uh, you know, the the
• 16:35
  Speaker 1: central part of the country that have yet to adopt
• 16:38
  Speaker 1: medical programs. Um. So you know, typical lifecycle of cannabis
• 16:42
  Speaker 1: adoption and the state is to lead with a medical
• 16:45
  Speaker 1: program that oftentimes is restrictive on the front side and
• 16:49
  Speaker 1: then develops over time into a more lenient and then
• 16:52
  Speaker 1: finally an adult use market. And certainly that's the pattern
• 16:55
  Speaker 1: that we've seen. Yeah, across it's all going there. It's
• 16:59
  Speaker 1: just it's a matter of time. Where are you on
• 17:01
  Speaker 1: the Sativa versus Indica debate, because well, we've got to
• 17:04
  Speaker 1: define that, Okay. So there's a lot of people who
• 17:07
  Speaker 1: swear by sativa versus Indica, saying the former gives you
• 17:11
  Speaker 1: like a nice head buzz, it'll get you energetic, maybe
• 17:13
  Speaker 1: a little pressure behind the eyes, but you can be
• 17:15
  Speaker 1: really creative and get things done, whereas indica is like
• 17:19
  Speaker 1: a couch high. It's a body high. It'll help you sleep,
• 17:23
  Speaker 1: you know. Um. But then some people say that differentiator
• 17:27
  Speaker 1: isn't necessarily reliable. What do you think, Kim, Well, I mean,
• 17:32
  Speaker 1: I think and again it all comes down to the
• 17:34
  Speaker 1: science and and really I mean the science and indicate
• 17:37
  Speaker 1: sitiva are are labels that that have developed over time
• 17:40
  Speaker 1: as just a simplified indicator on how certain strings typically
• 17:45
  Speaker 1: affect folks. UM. But really it does come down to
• 17:48
  Speaker 1: UM again the terp turpine profile UM and in the
• 17:52
  Speaker 1: genetics of that particular plant UM, which again is why
• 17:55
  Speaker 1: we think there is such an opportunity for clear communication
• 17:58
  Speaker 1: UM in branding in this in the space. So you know,
• 18:01
  Speaker 1: I think that looks to tiva indica serve as a
• 18:03
  Speaker 1: as a you know, a decent indicator so that folks
• 18:06
  Speaker 1: can make at least an informed UM informed decision, but
• 18:10
  Speaker 1: really as just like just like with wine or with
• 18:12
  Speaker 1: other other products, that folks become more sophisticated. We find
• 18:16
  Speaker 1: that UM, you know, instead of just focusing on those
• 18:18
  Speaker 1: labels UH there instead you know, gravitating more towards understanding
• 18:22
  Speaker 1: what the underlying UM, you know, components of that particular product,
• 18:26
  Speaker 1: all about the turps. I think that's the key, you know,
• 18:29
  Speaker 1: and the science there's still a long way to go
• 18:32
  Speaker 1: in terms of identifying the turpins and figuring out what
• 18:35
  Speaker 1: they do, UM, what mixtures UH result in in which affects.
• 18:40
  Speaker 1: I think it's just so fascinating UM you're the extra.
• 18:44
  Speaker 1: I'm learning him. Are you high right right now? No?
• 18:49
  Speaker 1: I just said earning, so m my my, now I am.
• 18:53
  Speaker 1: I have been if you can tell my throat I have.
• 18:55
  Speaker 1: I have been kind of pounding some uh let's see
• 18:58
  Speaker 1: throat coat tea and some big cuill over here. But
• 19:02
  Speaker 1: sometimes if you're congested, maybe just a little bit of
• 19:05
  Speaker 1: you know, just just one little hit can can dry
• 19:08
  Speaker 1: you up right away, right away. All right, Kim Rivers,
• 19:10
  Speaker 1: thank you so much for joining us. Kim Rivers chair
• 19:12
  Speaker 1: and CEO of Truly It is a publican trade stock.
• 19:15
  Speaker 1: T c n n F is the ticker. Ed Ludlow
• 19:23
  Speaker 1: is also in San Francisco, UM and he is basically
• 19:26
  Speaker 1: our kind of evies reporter rocket ships. He's the rocket guy. UM.
• 19:32
  Speaker 1: He really covers all the Silicon Valley like tech stuff.
• 19:34
  Speaker 1: And what about weed? Do you ever indulge? I do
• 19:39
  Speaker 1: not cover that industry and I do not indulge, but
• 19:45
  Speaker 1: in California many people do. And that's do we have
• 19:48
  Speaker 1: a dedicated before we get to riving, because that's why
• 19:50
  Speaker 1: do we have a dedicated weed reporter. We do. Tiffany
• 19:53
  Speaker 1: Carry and I really recommend you follow her on Twitter
• 19:56
  Speaker 1: and on the Bloomberg terminal for all of her reporting.
• 19:58
  Speaker 1: All right, I'm in let's get to Ribbyan right now,
• 20:00
  Speaker 1: because um, I was not only UM was I reading
• 20:04
  Speaker 1: the stories yesterday and following very closely, especially because I'm
• 20:08
  Speaker 1: sure you saw that Folkswagen is bringing back the International Scout. Yes,
• 20:12
  Speaker 1: and it looks a heck of a lot like a Ribban.
• 20:16
  Speaker 1: It kind of does, isn't it. Yeah, And it's electric.
• 20:18
  Speaker 1: It'll be a direct competitor UM to that, and the
• 20:21
  Speaker 1: Bronco went for it. Finally electrifies the Bronco. Why didn't
• 20:25
  Speaker 1: bring that one out electric first? I'll never understand. But
• 20:28
  Speaker 1: Ribbyan did pretty well. And I saw an analyst quote
• 20:30
  Speaker 1: UM at a Wells Fargo calm Lange, and I thought
• 20:33
  Speaker 1: was really good. He said, no, bad news is sometimes
• 20:36
  Speaker 1: good news. Yeah. I mean, that's basically the perfect sum
• 20:41
  Speaker 1: of the earnings that nothing really happened. You know. They
• 20:44
  Speaker 1: reaffirmed guidance for the year they'll build twenty five thousand evs.
• 20:48
  Speaker 1: That was already essentially a cut forecast of the year
• 20:51
  Speaker 1: because the factory on paper was capable of doing fifty
• 20:55
  Speaker 1: thousand this year and supply chain problems part shortages. Um,
• 21:00
  Speaker 1: But you know this is a company that's fledgling. Right.
• 21:05
  Speaker 1: We've been so caught up in the equity story where
• 21:08
  Speaker 1: the stocks fallen from a hundred and seventy two dollars
• 21:10
  Speaker 1: a share in November following the I p O to
• 21:12
  Speaker 1: around dollars a share that we forget. It's just a
• 21:16
  Speaker 1: fledgling company trying to get off the ground. So it
• 21:19
  Speaker 1: is is there still again judging by the start press
• 21:22
  Speaker 1: you just mentioned here, we're down sev year to date, right,
• 21:25
  Speaker 1: I guess there's real concern about it. This is an
• 21:27
  Speaker 1: ongoing concern whether they can actually make enough cars to
• 21:32
  Speaker 1: turn a profit. We've we've really been debating this um
• 21:35
  Speaker 1: in the team today because not all EV makers or
• 21:39
  Speaker 1: would be ey makers are equal, right, you know, Rivian,
• 21:41
  Speaker 1: I've been inside the factory. It's real. You know, they
• 21:45
  Speaker 1: produced around twenty vehicles in the quarter. They've built five
• 21:49
  Speaker 1: thousand of them since starting production in September. They are
• 21:54
  Speaker 1: supply constrained, right, That demand vastly outweighs their ability to build.
• 21:59
  Speaker 1: But their ability to build is also constrained by part shastages.
• 22:02
  Speaker 1: And the message from management on the cool was very
• 22:04
  Speaker 1: much it's improving and and they're having to go cap
• 22:08
  Speaker 1: in hand right to their suppliers and say we're ready
• 22:11
  Speaker 1: to build vehicles. You guys just have to give us
• 22:13
  Speaker 1: the parts, because when you're a small player, you don't
• 22:16
  Speaker 1: have that leverage of scale that say a Tesla has
• 22:19
  Speaker 1: or a GM or Ford has to put pressure on
• 22:22
  Speaker 1: supplies to make them come up with the goods. By
• 22:24
  Speaker 1: the way, your your wedding is coming up. If I decided, listen,
• 22:29
  Speaker 1: I'm gonna give breaking News a Rivian for his wedding,
• 22:32
  Speaker 1: UM and I put in the order today, would I
• 22:36
  Speaker 1: get the truck and time? No? Not even close. So
• 22:39
  Speaker 1: I mean we're talking. That's a generous offer. By the way, Matt,
• 22:45
  Speaker 1: you know my better half, she's very much thinking about
• 22:48
  Speaker 1: a future home and sort of kitchen where but if
• 22:51
  Speaker 1: a Rivian would be good. But this is the story.
• 22:53
  Speaker 1: You know that it's a one or two year waiting list.
• 22:56
  Speaker 1: It's exactly and it's one or two you're waiting list
• 22:59
  Speaker 1: for an expense SA products. They've already raised prices, right,
• 23:02
  Speaker 1: and they've actually come out and said subsequently that we
• 23:04
  Speaker 1: can't actually guarantee the price. Now, how much is a
• 23:07
  Speaker 1: conservatively built I'm sure you've been on the configurator and
• 23:10
  Speaker 1: put together your dream riving and how much is it
• 23:12
  Speaker 1: a conservatively built truck dollars? Basically, Yeah, it's a lot,
• 23:17
  Speaker 1: isn't it. And especially if you're gonna wait by that time,
• 23:20
  Speaker 1: you'd imagine that Ford with the F one fifty might
• 23:23
  Speaker 1: use that opportunity to to scale quicker and offer a
• 23:28
  Speaker 1: lower end product similar price point though, by the way,
• 23:30
  Speaker 1: because I've I've configured my F one fifty lightning on
• 23:34
  Speaker 1: the website and I also get to eight or ninety's
• 23:40
  Speaker 1: and that's without putting on the rooftop tent and um
• 23:44
  Speaker 1: I got the tunnel grill. I mean, there's so many
• 23:46
  Speaker 1: cool things, especially that you can add to ominal fashioned stock.
• 23:51
  Speaker 1: Guy when I buy an imp and I see, uh,
• 23:53
  Speaker 1: you know some of these big big insider self stock
• 23:56
  Speaker 1: like day one when they're when when they can, like
• 23:58
  Speaker 1: in this case, forward and shaping work and sold the
• 24:00
  Speaker 1: ribbyan staff. What does the company say about that? Yeah,
• 24:03
  Speaker 1: they they're sanguine about it. I mean, you raise a
• 24:07
  Speaker 1: really good point. A lot of the pressure on this
• 24:08
  Speaker 1: stock in recent weeks has been the lock up expiry, right,
• 24:11
  Speaker 1: and this was a blockbuster ip O. Remind your listeners
• 24:14
  Speaker 1: six biggest I p O in in US history, the
• 24:16
  Speaker 1: biggest one at a time where it was still revenue
• 24:20
  Speaker 1: still distant volume revenue sales were actually soften. They expecting
• 24:24
  Speaker 1: this quarter had just gone, Um, how do you valueate?
• 24:27
  Speaker 1: I mean on the cool Adam Jonas of Morgan Sanley,
• 24:30
  Speaker 1: who you guys are familiar with, he was really fixated
• 24:32
  Speaker 1: on enterprise value. Superstar car analyst, right, superstar car analyst.
• 24:36
  Speaker 1: And he was like, guys, the market has no patients
• 24:39
  Speaker 1: for companies like yours who are burning through cash. Ribbyan's
• 24:42
  Speaker 1: point is, well, we are burning through cash, but we
• 24:45
  Speaker 1: have seventeen billion dollars on the balance sheet. I don't
• 24:47
  Speaker 1: want to pus in the same bucket as Nicola. That's
• 24:50
  Speaker 1: what I'm saying is that not we v makers are equal.
• 24:53
  Speaker 1: Right that you you think about the Lord's Towns, the Nicholas,
• 24:57
  Speaker 1: they don't have seventeen billion dollars of cash. The concern
• 24:59
  Speaker 1: from market, and what you see reflects in the equity
• 25:01
  Speaker 1: story is it's going to take them a lot and
• 25:04
  Speaker 1: a long time to reach profit. But the message from
• 25:07
  Speaker 1: the management was scale, scale brings profit. We've got a beautiful,
• 25:11
  Speaker 1: shiny factory. And I can tell you because I know
• 25:13
  Speaker 1: I've been there. Thousands of built trucks are on the
• 25:16
  Speaker 1: lot waiting for delivery. They just fledgling working out the logistics.
• 25:20
  Speaker 1: I like the suv uh, the enclosed suv version, rather
• 25:23
  Speaker 1: than the pick up truck, because if I'm gonna pick
• 25:25
  Speaker 1: up truck, I'm gonna get America pickups. Trying to get
• 25:27
  Speaker 1: American pickup truck ed love West Coast Corresponding Bloomberg News
• 25:31
  Speaker 1: bring us the latest on ribbing that starts up today.
• 25:34
  Speaker 1: That's a good news. The bad news down seventy year
• 25:36
  Speaker 1: to date. Thanks for listening to the Bloomberg Markets podcast.
• 25:42
  Speaker 1: You can subscribe and listen to interviews of Apple podcasts
• 25:45
  Speaker 1: or whatever podcast platform you prefer. I'm Matt Miller. I'm
• 25:49
  Speaker 1: on Twitter at Matt Miller three. Put on ball Sweeney.
• 25:53
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• 25:56
  Speaker 1: can always catch us worldwide at Bloomberg Radio