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Sonos CEO: Stay Tuned For Audio Category Expansion · Bloomberg Intelligence

• 0:01
  Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, along
• 0:04
  Speaker 1: with my co host of Bonnie Quinn. Every business day
• 0:06
  Speaker 1: we bring you interviews from CEOs, market pros, and Bloomberg experts,
• 0:10
  Speaker 1: along with essential market moving news. Find the Bloomberg Markets
• 0:13
  Speaker 1: Podcast on Apple Podcasts or wherever you listen to podcasts,
• 0:17
  Speaker 1: and on Bloomberg dot com. Well So nost they reported
• 0:20
  Speaker 1: better than expected numbers last night after the closed raised
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  Speaker 1: their forward guidance. The stock market like it's likes it.
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  Speaker 1: It's up seventeen percent today, s O n O on
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  Speaker 1: your Bloomberg terminal stocks up seventeen percent today, fifty seven
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  Speaker 1: percent year to date, and about a hundred sixty seven
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  Speaker 1: percent on a trailing twelve month basis. So this story
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  Speaker 1: is absolutely working for shareholders. To give us the latest.
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  Speaker 1: We welcome so to CEO of Patrick Spence. Patrick talked
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  Speaker 1: to us first about your earnings last night. Big numbers,
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  Speaker 1: the street like some what are the key takeaways? Yeah, thanks, Paul. Uh,
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  Speaker 1: you know, we have really capitalized on the system that
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  Speaker 1: we've built over the last nineteen years. And know I
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  Speaker 1: mentioned last quarter we'd hit an inflection point. I feel
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  Speaker 1: like we're just you know, continuing to go from strength
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  Speaker 1: to strength on the back of that, and certainly you're
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  Speaker 1: one of the big trends here is just the explosion
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  Speaker 1: in audio, right, so you see it with podcasts, the
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  Speaker 1: streaming music, take up audio, books, and now social audio.
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  Speaker 1: So audio is booming and we are a huge beneficiary
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  Speaker 1: of that. Patrick, I'm going to ask them one question
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  Speaker 1: that's been on everyone's minds for a long time. You
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  Speaker 1: know what that is? Are we getting headphones? You know?
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  Speaker 1: And you know we don't talk about a product roadmap,
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  Speaker 1: but look, but you said we would. We are a
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  Speaker 1: small player in the whole audio category. Today, we see
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  Speaker 1: a lot of opportunity in a number of categories that
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  Speaker 1: we're not in today. So, uh, stay tuned because I
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  Speaker 1: think over time, uh, you know, you can expect to
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  Speaker 1: see us play in every category of audio. All right, Patrick,
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  Speaker 1: give us a sense of how your business. That's kind
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  Speaker 1: of rewind back to early March of last year, kind
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  Speaker 1: of just give us a sense of how you our
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  Speaker 1: business changed in March of Yeah, it was you know,
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  Speaker 1: it was a shock. Obviously, our first focus was on
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  Speaker 1: the health and safety of our people. So March thirteenth,
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  Speaker 1: we all headed home and we've been working from home
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  Speaker 1: ever since, UH, and I just have been astounded by
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  Speaker 1: you know, I knew we had the best team in
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  Speaker 1: the world. I might be a little bit biased, but
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  Speaker 1: at the same time, you know, to see the way
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  Speaker 1: that everybody has adapted, UH, and how resilient they've been
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  Speaker 1: in the face of all the challenges that we've had
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  Speaker 1: this year. And you you guys know, supply chain has
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  Speaker 1: been a massive issue this year, right with all these shortages,
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  Speaker 1: everything that's been happening, and our team has just done
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  Speaker 1: a phenomenal job, like you know, end to end in
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  Speaker 1: terms of being able to manage our business, create new products,
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  Speaker 1: launched new products, sell our products. I mean, our DTC
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  Speaker 1: sales have been off the charts, UH, in the midst
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  Speaker 1: of a pandemic and working from home, and so I
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  Speaker 1: am just so proud of the team and grateful. But
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  Speaker 1: it's really been a team effort, UH, and the adaptability
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  Speaker 1: and resilience has been incredible. Patrick, how do you sell sons?
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  Speaker 1: So the sense of you know, high end audio is
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  Speaker 1: such a specialized field and it's so particular, and at
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  Speaker 1: the same time, if you walk into a store and
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  Speaker 1: you don't know enowful lot about the back brands, backgrounds
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  Speaker 1: or what have you. What's to stop somebody buying a
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  Speaker 1: Bows over a Sun Nos. Yeah, well, I think the
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  Speaker 1: you know, you can get started with sas for So
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  Speaker 1: we've really democratized that and democratized and brought kind of
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  Speaker 1: high end audio um to the masses, if you will.
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  Speaker 1: And the best place I would want you to experience
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  Speaker 1: so Nos is someone else's home and that's where that's
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  Speaker 1: the number one driver of our new customers is actually
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  Speaker 1: hearing about Sons from a friend or family member, and
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  Speaker 1: that's how they come into the Sons ecosystem. And that
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  Speaker 1: is huge, right, It's a huge testament to the power
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  Speaker 1: of the brand, a huge testament to the customer experience
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  Speaker 1: that we deliver today. And the nice thing about Sons
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  Speaker 1: and what's different than all the traditional audio brands is
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  Speaker 1: that you can start with one, you can start with many,
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  Speaker 1: and then you add more over time. So one of
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  Speaker 1: the greatest things that we we talked about in this
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  Speaker 1: last quarter is that we had a record percentage of
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  Speaker 1: our existing customers coming back in the quarter and adding
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  Speaker 1: another product to their Sonos system, not replacing, but rather
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  Speaker 1: adding another Sonos product into their home which um is
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  Speaker 1: just a testament to the kind of products we build
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  Speaker 1: in the brand We've built your where again in Santa
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  Speaker 1: Barbara because me and Paul will come right over and
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  Speaker 1: and tast that out. I tried. You know, I grew
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  Speaker 1: up in Toronto, so I I think I've paid my
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  Speaker 1: dues when it comes to snow and the cold and
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  Speaker 1: all of those things. But you're welcome any time. Yeah,
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  Speaker 1: So it's interesting. So, um, Patrick, I'm a former investment banker.
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  Speaker 1: When I see a stock up as much as yours is,
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  Speaker 1: I know you don't necessarily need the cash. Any thoughts
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  Speaker 1: of raising equity here and take advantage of your strong
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  Speaker 1: stock price. Uh No. We we reported record cash levels
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  Speaker 1: and we paid off a little bit of debt that
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  Speaker 1: we had, so debt free we bout six hundred fifty
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  Speaker 1: million on the balance sheet. We are fully focused on
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  Speaker 1: how do we invest that to drive more growth and
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  Speaker 1: build on this momentum through you know, a lot of
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  Speaker 1: acquisitions or organic efforts. But um, we are just uh,
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  Speaker 1: we feel like we have great momentum. There's a massive
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  Speaker 1: opportunity in front of us. It's all about investing. Patrick.
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  Speaker 1: It's an absolute pleasure to speak with you when should
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  Speaker 1: we expect maybe another product updates? Briefly, Well, you know,
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  Speaker 1: we actually I mentioned last night that we have a product,
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  Speaker 1: new product coming next month, so we're excited about that.
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  Speaker 1: And we also have our first investor event on March nine,
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  Speaker 1: so uh, stay tuned for that one. Well, that is exciting.
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  Speaker 1: sUAS of course US based and just a wonderful audio
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  Speaker 1: product maker, charging cradles, adapters, controller as well as speakers,
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  Speaker 1: you know, loudspeakers, amps, anything that you could possibly think of,
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  Speaker 1: and they are based in Santa Barbara, California with about
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  Speaker 1: fifteen hundred employees. Patrick Spence is CEO of Well, it's
• 5:50
  Speaker 1: our pleasure now to bring in Dr lucas A Jumpa,
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  Speaker 1: who's chief environmental officer for Microsoft. No less, it's the
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  Speaker 1: first time that there husband the chief environmental officers. So basically,
• 6:02
  Speaker 1: Dr Joppa is leading the development and execution of any
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  Speaker 1: sustainability strategy that Microsoft comes up with across its worldwide business.
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  Speaker 1: So Dr Joppa, thanks for joining. What have you decided
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  Speaker 1: Microsoft needs to do in terms of sustainability, Well, thanks
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  Speaker 1: for having me on the show. Really a pleasure to
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  Speaker 1: talk about sustainability, particularly now in UM in today's climate
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  Speaker 1: in today's administration here in the United States. I think
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  Speaker 1: a little bit ago, about a year ago, Microsoft stepped
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  Speaker 1: back and asked itself if we thought we were doing
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  Speaker 1: enough on sustainability. I think the clear answer was no,
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  Speaker 1: everybody needs to do more. We put in place an
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  Speaker 1: acceleration of our ambition really to see a set industry
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  Speaker 1: leading commitments across four key areas, carbon, water, waste, and ecosystems.
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  Speaker 1: And we spent the last year setting those commitments, which
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  Speaker 1: were designed to address what's the best available science says
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  Speaker 1: every individual organization and ultimately our global economy needs to do.
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  Speaker 1: And we culminated the year with a set of commitments
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  Speaker 1: to see us by committing to be a carbon negative,
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  Speaker 1: water positive, zero waste company that's also protecting more land
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  Speaker 1: than we use and building out the computational infrastructure of
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  Speaker 1: what we call a planetary computer to help society better
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  Speaker 1: manage natural resources. So I think those that set of
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  Speaker 1: commitments really does concisely represent what we think needs to
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  Speaker 1: be done. And about two weeks ago we issued our
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  Speaker 1: first annual report that was kind of a a progress
• 7:39
  Speaker 1: report on how we've done in the first year of
• 7:43
  Speaker 1: not just commitment setting, but also working towards achieving our
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  Speaker 1: commitments in saw some great progress. We reduced our emissions
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  Speaker 1: by six percent, a little over six percent. We managed
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  Speaker 1: to complete a pretty historic removal of carbon purchase of
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  Speaker 1: carbon move all of about one point three million metric tons.
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  Speaker 1: Both of those things put us well on our way
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  Speaker 1: to being a carbon negative company by so, Dr Choppa,
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  Speaker 1: how do we uh, you know e s G investing
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  Speaker 1: environmental sustainability, social governance. I mean it's becoming a big,
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  Speaker 1: big part of the investment community investment process. How do
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  Speaker 1: we hold senior managers, board members accountable for these goals?
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  Speaker 1: Tell us how Microsoft does that? Because a lot of
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  Speaker 1: folks are just concerned that this is rhetoric from corporate
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  Speaker 1: America and not net's say, something that's measured, uh and
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  Speaker 1: maybe reflecting compensation for for example, Well, one of the
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  Speaker 1: things that we thought was important was to represent it
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  Speaker 1: in compensation for our senior leaders. So after a lot
• 8:44
  Speaker 1: of thinking about this, this is exact question that you pose,
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  Speaker 1: how do you hold senior leaders accountable? We um We
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  Speaker 1: announced as as part of our one year and the
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  Speaker 1: Anniversary announcement, that we would be tying executive compensation of
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  Speaker 1: our CEO, our president, our CFO, and the senior leadership
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  Speaker 1: team more broadly to meeting our sustainability goals. And I
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  Speaker 1: think that is just absolutely critical in the corporate context
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  Speaker 1: to really tie it directly to the core compensation incentivization
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  Speaker 1: measures that any company holds. So what does that specifically
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  Speaker 1: mean for our products? Will we notice any difference? Uh? Well,
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  Speaker 1: I hope so, um, But in many respects, we don't
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  Speaker 1: really want you to notice a lot of difference. We
• 9:29
  Speaker 1: want your products that UM that you consume from Microsoft
• 9:34
  Speaker 1: to you know, be as as as helpful as as
• 9:38
  Speaker 1: they possibly can be, but we want them to do
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  Speaker 1: that in a way that's increasingly environmentally sustainable. So should
• 9:45
  Speaker 1: you notice that your products are being powered by renewable
• 9:49
  Speaker 1: energy um, like they will be by for all of
• 9:55
  Speaker 1: our cloud customers. I wouldn't expect you to notice that,
• 9:59
  Speaker 1: but I would expect you to just by default receive
• 10:02
  Speaker 1: those benefits by just being a customer of Microsoft. Would
• 10:07
  Speaker 1: I expect you to notice that, you know, all of
• 10:10
  Speaker 1: the hardware and componentry of our data centers, for instance,
• 10:14
  Speaker 1: are part of a new circular cloud initiatives that where
• 10:18
  Speaker 1: we have behind our secure private perimeter of our data centers,
• 10:21
  Speaker 1: increasing our reusability and recycling of all of our componentry
• 10:25
  Speaker 1: by up You probably won't notice that either, but all
• 10:28
  Speaker 1: of our customers are going to receive those sustainability benefits
• 10:32
  Speaker 1: by default. It's been up to us to be able
• 10:34
  Speaker 1: to provide those reporting platforms so that those who care
• 10:38
  Speaker 1: do have access to that information, so that they can
• 10:42
  Speaker 1: included in their external third party reporting into their stakeholders
• 10:45
  Speaker 1: and shareholders. Dr Choppic spent twenty seconds here just give
• 10:49
  Speaker 1: us a sense of the governments that you work with
• 10:51
  Speaker 1: around the world. How cooperative have they been? Well? You
• 10:56
  Speaker 1: just I think everybody is seeing the tide shift here
• 11:00
  Speaker 1: and governments all around the world. We have a new
• 11:01
  Speaker 1: administration here in the United States, we saw some extremely
• 11:05
  Speaker 1: interesting executive orders putting the full weight of government into
• 11:09
  Speaker 1: um clean climate procurement decisions, putting science at the at
• 11:15
  Speaker 1: the center of decision making. UH. In the EU we
• 11:18
  Speaker 1: see just you know, rapid progress on this. I think
• 11:21
  Speaker 1: this is the We're starting to see the dominoes fall
• 11:23
  Speaker 1: all across the world on progressive policy. UM right, progressive
• 11:27
  Speaker 1: climate policy very good. We will certainly be paying attention
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  Speaker 1: going for Dr Lucas job a Chief Environmental Officer for Microsoft,
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  Speaker 1: based of course in Redmond, Washington, as a company accelerates
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  Speaker 1: its plans for to go green, to become even more green. Well,
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  Speaker 1: New York City restaurants they will be open their indoor
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  Speaker 1: dining too about capacity beginning tomorrow, just in time for
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  Speaker 1: the Valentine's Day rush. This is good news for restaurants.
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  Speaker 1: A question is how good? Uh is this news? Let's
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  Speaker 1: check with Kate Creator. She's a food editor for Bloomberg Pursuits,
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  Speaker 1: joining us on the phone from New York City. So, Kate,
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  Speaker 1: it's good news for the restaurants, I think, but I'm
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  Speaker 1: just not sure how good? What do you think? That's
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  Speaker 1: exactly right. It's good news and the optics of it
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  Speaker 1: are good, and it gets restaurants names out there. You
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  Speaker 1: get to think about it, you know, get the gears going.
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  Speaker 1: But in terms of financial like windfall, it's nowhere near that.
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  Speaker 1: In fact, it's a lost for a lot of them
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  Speaker 1: to open. Will they be able to access more p
• 12:28
  Speaker 1: P P if we get I mean at the moment
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  Speaker 1: it's eight million dollars in the proposal by the administration
• 12:36
  Speaker 1: and may not end up at eight hundred plus billion dollars,
• 12:38
  Speaker 1: but that's where it is at now. Would these restaurants
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  Speaker 1: that have managed to stay open or to close and
• 12:43
  Speaker 1: reopen be able to access more of that? Yeah, they
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  Speaker 1: should on the new loans are definitely geared more left
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  Speaker 1: prochained and more towards independent restaurants. And there's a news
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  Speaker 1: there's a cent five billion dollar federally built for restaurants
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  Speaker 1: that is getting some attention and everyone is very hopeful
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  Speaker 1: about that. That that's the kind of thing that makes
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  Speaker 1: it different. You know, not not opening for tables on
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  Speaker 1: you know, right before Valentine's Day, that's not that's not
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  Speaker 1: sustaining restaurant. So it kind of just you know, reading
• 13:17
  Speaker 1: your story on the Bloomberg terminal with you and your team,
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  Speaker 1: lots of great reporting in there. So I guess one
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  Speaker 1: of the issues is I got a lot of restaurants
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  Speaker 1: laid off staff when they were forced to close. Can
• 13:30
  Speaker 1: they even get that staff back and be ready to go?
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  Speaker 1: It seems like kind of a rush here. It's a
• 13:36
  Speaker 1: great question. And yeah, I think even geting up towards
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  Speaker 1: Valentine's Day, um that that in itself was its talents.
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  Speaker 1: But when Cuomo made a relatively last minute call to
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  Speaker 1: open on Friday the twelfth instead of Sunday the fourteenth.
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  Speaker 1: It gives it gives restaurants a couple more days to
• 13:54
  Speaker 1: celebrate Valentine's Day, but it's really short notice because a
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  Speaker 1: lot of restaurant workers can afford a New York City
• 14:01
  Speaker 1: rent and have moved away. So it's been a scramble
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  Speaker 1: for a lot of them to staff their dining rooms. Okay,
• 14:07
  Speaker 1: in your story, there's this sentence, and it's just so sad. Already,
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  Speaker 1: more than one hundreds and thousand restaurants have closed permanently
• 14:15
  Speaker 1: or for the long term across the country, with New
• 14:18
  Speaker 1: York City seeing more than four thousand closures according to
• 14:21
  Speaker 1: the New York State Restaurant Association. These closures. Any hope
• 14:25
  Speaker 1: that these these chefs and these managers and so on,
• 14:28
  Speaker 1: that they'll reopen maybe once rent goes down in certain areas. Yeah, Bunny,
• 14:34
  Speaker 1: you know what, I really want to be hopeful about that.
• 14:36
  Speaker 1: And I mean, there's so much talent, and you can
• 14:38
  Speaker 1: see from the way so many restaurants activity there, you know,
• 14:42
  Speaker 1: their models to do take out and Neil kids. I
• 14:45
  Speaker 1: think there's a lot of opportunity for them. But there's
• 14:48
  Speaker 1: also a fear. This is another story we're working on that. UM.
• 14:52
  Speaker 1: For all the real estate opportunities out there, it's going
• 14:54
  Speaker 1: to be the changes that are going to sweep in
• 14:56
  Speaker 1: and take advantage of it. UM. So, to go back
• 14:59
  Speaker 1: to what Paul was saying, hopefully, when the loans come through,
• 15:02
  Speaker 1: UM some good enterprising steps and UM restaurant people will
• 15:06
  Speaker 1: be able to take advantage of that. Okay, My understanding
• 15:09
  Speaker 1: of the economics of the restaurant business is it's very
• 15:12
  Speaker 1: very thin margins and you have to be at or near,
• 15:16
  Speaker 1: you know, full capacity and turn over the tables and
• 15:19
  Speaker 1: all that kind of stuff, and it just seems like
• 15:23
  Speaker 1: an unsustainable level. What are some of these restaurant owners
• 15:27
  Speaker 1: hoping for the hoping to get back to full capacity
• 15:30
  Speaker 1: by the spring, by the summer. What are they saying? Yeah, No,
• 15:33
  Speaker 1: there's a big UM, there's a big place some New
• 15:35
  Speaker 1: York City. UM restaurateurs are lobbying hard UM. The blog
• 15:39
  Speaker 1: you and Cuomo too quickly open at I'm not sure
• 15:44
  Speaker 1: a hundred percent is I wouldn't even guess when that's
• 15:47
  Speaker 1: going to happen. But when outdoor dining can come back
• 15:50
  Speaker 1: strong or been fantastic innovations on that front. I think
• 15:53
  Speaker 1: with indoor dining and outdoor dining like nice Weather and
• 15:58
  Speaker 1: all those accommodations of the NATE, that's starting to be
• 16:01
  Speaker 1: a much more sustainable model for restaurants. But like Daniel
• 16:05
  Speaker 1: Ballut is the great TEP. Daniel Blues said, another another
• 16:09
  Speaker 1: hard factor for them is that there's a mandated closure
• 16:12
  Speaker 1: at ten PM, and that means a lot of these
• 16:15
  Speaker 1: restaurants at only twenty percent, can only do one service
• 16:18
  Speaker 1: at night. If it was extended to eleven, they might
• 16:21
  Speaker 1: be able to do two services. And that is you
• 16:23
  Speaker 1: can imagine double the amount of people you can bring in.
• 16:26
  Speaker 1: And it's funny places where there are more people, like
• 16:28
  Speaker 1: New Jersey have higher capacity. So right now it's it's
• 16:32
  Speaker 1: a thirty five present capacity and Westchester is operating at
• 16:36
  Speaker 1: half capacity. And apparently that's where everybody went. You would
• 16:39
  Speaker 1: have thought that New York City, which is empti or
• 16:41
  Speaker 1: would be able to you know, here in New Jersey
• 16:43
  Speaker 1: at the restaurants, they are at capacity. I mean, if
• 16:46
  Speaker 1: you cool, the demand is there, yeah, absolutely, Kate. Finally,
• 16:50
  Speaker 1: our landlords giving any concessions and totally I have heard
• 16:54
  Speaker 1: that they are absolutely not giving any concessions, which really
• 16:57
  Speaker 1: surprises me. Yeah, and ectotally I've heard to say saying,
• 17:00
  Speaker 1: although actually I've heard that they're starting to there's you know,
• 17:05
  Speaker 1: it's there's so much empty store front now, so many
• 17:08
  Speaker 1: of them. Um, I think they are starting to realize
• 17:12
  Speaker 1: or make or instead of doing like long term leases,
• 17:15
  Speaker 1: doing short leases, which um I think convenitate of combetit
• 17:20
  Speaker 1: at restaurants who might want to try and experiment and
• 17:22
  Speaker 1: do something, but now it's not happening. It's fast. Yeah,
• 17:25
  Speaker 1: I mean literally Midtown Manhattan. You're talking about, you know,
• 17:29
  Speaker 1: ninety dollars per square foot. You know, it's it's an
• 17:32
  Speaker 1: insane amount of rent. But that's because there are normally
• 17:36
  Speaker 1: tourists all over the place and every place is always full,
• 17:39
  Speaker 1: and you know it can withstand that. But I can
• 17:42
  Speaker 1: tell you Midtown Manhattan is absolutely empty. Kate Craters, thank you.
• 17:46
  Speaker 1: It's a great story. On the Bloomberg Wall Street. Time
• 17:51
  Speaker 1: for Bloomberg Opinion today we are joined by Ferdinando Giuliano,
• 17:55
  Speaker 1: Bloomberg Opinion editor. His column is entitled Who's booking their
• 17:59
  Speaker 1: beach holiday? Are Ready? And it really goes to the
• 18:01
  Speaker 1: issue of as more and more people get shots how
• 18:05
  Speaker 1: much freedom should they have for the NANDO Thanks much
• 18:07
  Speaker 1: for joining us here. Give us a key takeaways here.
• 18:10
  Speaker 1: How do you think this is going to play out
• 18:11
  Speaker 1: as more and more people begin to get jobs. Well,
• 18:16
  Speaker 1: I think it's going to become a very important issue
• 18:19
  Speaker 1: at the moment um. You know, the data collected shows
• 18:22
  Speaker 1: that we've got around nine at least nineteen million people
• 18:26
  Speaker 1: in the ward who have been fully vaccinated. That means
• 18:30
  Speaker 1: two jobs because the existing vaccines required to thoses as
• 18:34
  Speaker 1: we know, uh and half of them are in the
• 18:37
  Speaker 1: United States. But as the rollout continues, this number is
• 18:41
  Speaker 1: going to grow, so governments will face demands to give
• 18:45
  Speaker 1: more freedom to people who have been fully fully immunized. UM.
• 18:51
  Speaker 1: But I think there are both medical and ethical issues
• 18:56
  Speaker 1: with giving these people, uh the sports back. You know,
• 19:01
  Speaker 1: we can call them passports if you want to detail
• 19:04
  Speaker 1: some of those medical issues if you will. I think
• 19:07
  Speaker 1: the artical issues we can probably imagine a little easier,
• 19:11
  Speaker 1: but the medical the main medical issues that we are
• 19:14
  Speaker 1: still not quite sure whether people who have been immunized
• 19:18
  Speaker 1: are infectious or not. In other words, we know that
• 19:23
  Speaker 1: vaccines are very effective in preventing, especially the world forms
• 19:28
  Speaker 1: of COVID nineteen. But we don't know yet with certainty
• 19:33
  Speaker 1: whether you can still spread the virus to other individuals.
• 19:37
  Speaker 1: And these issue is key. If you think, for example,
• 19:40
  Speaker 1: about doctors. I mean, doctors have been vaccinated first partly
• 19:47
  Speaker 1: to protect them, but mainly to um, you know, make
• 19:51
  Speaker 1: sure that they don't spread the virus to the people
• 19:55
  Speaker 1: who are in hospital are very fragile. Now imagine we
• 19:59
  Speaker 1: give we tell officers that we can they can just
• 20:02
  Speaker 1: roll around freely because you know, we want to give
• 20:06
  Speaker 1: them this passport, but they could become dangerous. Now there
• 20:09
  Speaker 1: is mounting evidence that perhaps these facts do protect from infection.
• 20:15
  Speaker 1: Once we have certainty that you know, their protection from
• 20:19
  Speaker 1: infection is very high, then we can set these medical
• 20:23
  Speaker 1: issues aside. But for now we just can't. Well, it
• 20:27
  Speaker 1: seems like there's also an economic argument here that we
• 20:30
  Speaker 1: all know on a global scale, um that you know,
• 20:33
  Speaker 1: the economic disruption and impact from closing down is just
• 20:37
  Speaker 1: too great. And it seems to me that you know,
• 20:42
  Speaker 1: I guess the argument could be made that hey, if
• 20:43
  Speaker 1: you're fully inoculated, go out and start living your life,
• 20:48
  Speaker 1: go to restaurants, go to Disney World. What are the
• 20:51
  Speaker 1: ethical issues associated with that that seems kind of straightforward
• 20:55
  Speaker 1: to a lot of people. But the issues that at
• 20:58
  Speaker 1: the moment, the distribution of back the supply of vaccines
• 21:02
  Speaker 1: is constrained, and the distribution of vaccine is tightly enforced
• 21:08
  Speaker 1: by politicians and the public health authorities. In other words,
• 21:12
  Speaker 1: if you're not vaccinated, it's not your choice, is because
• 21:16
  Speaker 1: the state has decided that you're not a priority group,
• 21:20
  Speaker 1: and for good reasons. I mean, I'm not I'm not
• 21:22
  Speaker 1: debating that. I think it's absolutely right that we are
• 21:25
  Speaker 1: take care first of all of the people who are
• 21:28
  Speaker 1: most at risk. But should then you know the fact
• 21:32
  Speaker 1: that the government is taking care of you by giving you, uh,
• 21:36
  Speaker 1: you know this um priority treatment allow you to go
• 21:40
  Speaker 1: and live your life, you know, better than those who
• 21:44
  Speaker 1: are further down the queue just because they're younger or um,
• 21:49
  Speaker 1: you know, they they don't have an underlying condition. I
• 21:53
  Speaker 1: think this is a real question and it could put
• 21:55
  Speaker 1: a lot more pressure on government to make different forms
• 21:59
  Speaker 1: of choice is from the ones they are making, again
• 22:02
  Speaker 1: for very good reasons. And one final point I think
• 22:04
  Speaker 1: is a generational issue. Let's remember a lot of young
• 22:08
  Speaker 1: people have been foured to stay at home. Maybe I've
• 22:11
  Speaker 1: lost their jobs, maybe couldn't attend schools because we were here.
• 22:16
  Speaker 1: You know, they were really trying to protect the elderly.
• 22:19
  Speaker 1: Now imagine a society where youngsters have been you know,
• 22:23
  Speaker 1: really been at home to protect the elderly and are
• 22:27
  Speaker 1: now fourced at home again, while the elderly can roam
• 22:30
  Speaker 1: around freely. I think they would feel very agreed. Do
• 22:35
  Speaker 1: we need all or most countries to get on the
• 22:39
  Speaker 1: same board or is it possible for each country to
• 22:42
  Speaker 1: sort of treat their citizens a different way and for
• 22:45
  Speaker 1: the world to go back to normal somehow well, I
• 22:49
  Speaker 1: think you know on many issues, like you know what
• 22:51
  Speaker 1: happens to your social life, your habits, whether you can
• 22:55
  Speaker 1: go to a restaurant and stadium or a concert, each
• 22:57
  Speaker 1: country can go alone. Obviously, on traveling, it's going to
• 23:01
  Speaker 1: be very different and there needs to be some coordination,
• 23:04
  Speaker 1: which is why the Greek Prime Minister Carya mits attack
• 23:08
  Speaker 1: is is very worried about the risk of another wasted
• 23:12
  Speaker 1: summer or a tourist dependents is asking the you to
• 23:17
  Speaker 1: adopt a joint position on this very issue. I think
• 23:21
  Speaker 1: where it comes to traveling that will need to be
• 23:23
  Speaker 1: co ordination. But I think at the moment um. Governments
• 23:27
  Speaker 1: are still grappling, even just domestically, with what the answer
• 23:31
  Speaker 1: they should give to this question. So for an under way,
• 23:35
  Speaker 1: what really think we should be focusing on to get
• 23:37
  Speaker 1: a sense of how this might play out. Is it
• 23:40
  Speaker 1: you know, some of the policies and the travel companies
• 23:43
  Speaker 1: um or from governments per se. I'm just not sure
• 23:46
  Speaker 1: what's going to be the driving forces about how we reopen.
• 23:49
  Speaker 1: Is it going to be driven by the government or
• 23:51
  Speaker 1: is it gonna be driven by the market. Well, I mean,
• 23:55
  Speaker 1: I think on the governments. Are governments are going to
• 23:58
  Speaker 1: be key because as we as we know, uh, you know,
• 24:01
  Speaker 1: they're being able to enforce their draconian rules over time.
• 24:05
  Speaker 1: So if they just are you know, companies from doing something,
• 24:09
  Speaker 1: companies will simply have to obey. But we also know
• 24:13
  Speaker 1: that you know, there's gonna be once you know, I
• 24:17
  Speaker 1: think the vaccine becomes more widely widespread, I think companies
• 24:20
  Speaker 1: will say some very important questions and governments will need
• 24:23
  Speaker 1: to provide answers. I think an obvious question issue is
• 24:27
  Speaker 1: whether where the companies will be able to dismiss workers
• 24:31
  Speaker 1: who do not want to get vaccinated. And I think
• 24:34
  Speaker 1: this is something which is going to be a very
• 24:38
  Speaker 1: big question, which I think legal scholars should already start
• 24:41
  Speaker 1: thinking about. Yeah, I mean I presently court cases to
• 24:46
  Speaker 1: that effect, right absolutely, And you know, I mean, I'm
• 24:50
  Speaker 1: all in favor of personal freedom, but when you start
• 24:52
  Speaker 1: thinking about some jobs, like people work in care homes,
• 24:57
  Speaker 1: you realize that having someone who doesn't to get vaccinated
• 25:02
  Speaker 1: is going to be a major, major issue, and not
• 25:04
  Speaker 1: just getting your personal It's not just an issue of
• 25:07
  Speaker 1: your own personal freedom, but it's an issue of the
• 25:10
  Speaker 1: safety of the people you work for. It is just
• 25:14
  Speaker 1: mind boggling the amount of people that are going to
• 25:16
  Speaker 1: have to get vaccinated in order for a workforce and
• 25:19
  Speaker 1: its entirety to go back to work. And again today
• 25:21
  Speaker 1: we saw initial droll these claims, a big disappointment. So
• 25:24
  Speaker 1: people aren't going back to work for many reasons right now,
• 25:26
  Speaker 1: so it's not as urgent question, Ferdinando, it is a
• 25:30
  Speaker 1: very thought provoking column. Thanks for joining us today. Ferdinando
• 25:33
  Speaker 1: Giugliano is Bloomberg Opinion editor. In the column, if you
• 25:36
  Speaker 1: want to look it up, is who's booking their beach
• 25:39
  Speaker 1: holiday already? Thanks for listening to Bloomberg Markets podcast. You
• 25:44
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• 25:48
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• 25:51
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  Speaker 1: Twitter at pt Sweeney. Before the podcast, you can always
• 25:57
  Speaker 1: catch us worldwide at Bloomberg Radio. Well oh,