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TikTok's Viral Distribution Power Rattles Trump Campaign Rally · 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 ceo, market pros, and Bloomberg experts,
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  Speaker 1: along with essential market moving news. Find the Bloomberg Markets
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  Speaker 1: Podcast on Apple podcast or wherever you listen to podcasts,
• 0:17
  Speaker 1: and on Bloomberg dot com. Let's bring in our next guest.
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  Speaker 1: Now going to be a fascinating conversation with Jim Anderson,
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  Speaker 1: who is CEO of Social Flow and in full disclosure,
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  Speaker 1: social Floe as a platform that is used by Bloomberg
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  Speaker 1: for social media purposes, used by many many companies. Jim, Welcome.
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  Speaker 1: We brought you on because we want to talk to
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  Speaker 1: you a little bit about what happened at that also
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  Speaker 1: rally over the weekend and how K pop Zoomers and
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  Speaker 1: those who stand with them, if you like, managed to
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  Speaker 1: reserve tickets for this rally and then of course they
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  Speaker 1: didn't turn up. They weren't interested in doing that. They
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  Speaker 1: how did it work to talk to us about TikTok
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  Speaker 1: and the power of sort of amplification. Yeah, funny, Jail,
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  Speaker 1: thanks for having me. This is this is a great
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  Speaker 1: story in terms of just illustrating the power of viral
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  Speaker 1: distribution on social networks, right, I mean that's not a
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  Speaker 1: new concept. Facebook's weren't been around for more than a decade,
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  Speaker 1: Twitter and others. And so what we saw is TikTok,
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  Speaker 1: which is an application typically is for like to dance
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  Speaker 1: videos being harnessed in a really new and different way.
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  Speaker 1: But the same algorithms that pow are those dance videos
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  Speaker 1: and make them show up in your feet also power
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  Speaker 1: the teenage activists efforts and interestingly, they're they're disappearing messages. Right.
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  Speaker 1: One of the things about TikTok is the messages disappear
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  Speaker 1: after some period of time. So not only did their
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  Speaker 1: parents not know what was going on, because parents, I
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  Speaker 1: have a teenage daughter, it's awfully difficult to know what's
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  Speaker 1: going on with your teenager, but the messages themselves disappeared.
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  Speaker 1: So it's sort of teenage tradecraft at work in a
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  Speaker 1: in a social media world. So, Jim, do we have
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  Speaker 1: hard data that shows that this is what really happened,
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  Speaker 1: that there was, in fact, I guess quote unquote bogus
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  Speaker 1: requests for tickets that were never fulfilled or picked up. Well,
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  Speaker 1: we don't, and there's really no way for us to know.
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  Speaker 1: I can I can bet you that the campaign, the
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  Speaker 1: Trump campaign, has that data, but it's certainly not going
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  Speaker 1: to be in their interests to sort of give this
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  Speaker 1: story any oxygen and to admit that that happened. And
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  Speaker 1: I do want to make one really important point, because
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  Speaker 1: this this issue officers gets dislated. The activities of the
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  Speaker 1: teenagers didn't keep people from showing up to the rally.
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  Speaker 1: I think the fact that we're in the midst of
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  Speaker 1: a global pandemic. The rally was in Tulsa, Oklahoma. That
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  Speaker 1: population of Tulsa's four hundred thousand. You know, you're asking
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  Speaker 1: to fill an eighteen or nineteen thousand feet arena plus
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  Speaker 1: forty thousand feet of of overflow from the outdoor stage.
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  Speaker 1: I think what they did, though, is they created the expectation,
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  Speaker 1: oh my goodness, this thing is out of control. The
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  Speaker 1: campaign wanted to believe that there was sort of this
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  Speaker 1: giant pent up demand, and so then they started talking
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  Speaker 1: about it. They wanted to believe it was true, and
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  Speaker 1: then they got set up just for a big, giant,
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  Speaker 1: sort of deflation of expectations. That's what the thieves managed
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  Speaker 1: to see exactly. So, on the one hand, there was
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  Speaker 1: a little bit of hubris. They were boasting about how
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  Speaker 1: many people are coming, they were creating out door overflow spaces.
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  Speaker 1: On the other hand, there was complacency. They didn't sort
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  Speaker 1: of call to arms the base, which may have been
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  Speaker 1: a good thing given the coronavirus has definitely knock gone away.
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  Speaker 1: What's the power that you know, a group of fans
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  Speaker 1: like K pop fans and zoomers and so on can
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  Speaker 1: leverage on TikTok Beyond this is there is there something
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  Speaker 1: a little more political in terms of getting out the
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  Speaker 1: vote or in terms of you know, um, convincing people
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  Speaker 1: to participate in democracy more. Yeah, I think there definitely
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  Speaker 1: are a lot of things and and you know, many
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  Speaker 1: people are excited that. Wow, that's is sort of the
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  Speaker 1: type of a much larger sphere as uh teenagers come
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  Speaker 1: of age, come of voting age. Specifically, I saw speciftic
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  Speaker 1: this morning that one of an eligible voters will be
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  Speaker 1: gen z uh and the upcoming presidential election. So you know,
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  Speaker 1: they they're starting to find their voice. And I'll go
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  Speaker 1: back to these algorithms. I mean, it's now very specky
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  Speaker 1: and not very accessible to talk about algorithms, but largely
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  Speaker 1: algorithms are a political right. They can spread content on left, right, middle,
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  Speaker 1: updown that they generally are not political. I know people's
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  Speaker 1: criticisms of them are significant and they feel like their
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  Speaker 1: side is being discriminated against. But if the teenagers are
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  Speaker 1: excited and are spreading it and are paying attention, the
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  Speaker 1: algorithms noticed that, and then they contribute to that. And
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  Speaker 1: I've sent viral distribution of of content is and and
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  Speaker 1: that's exactly what TikTok is doing. So jim I, I
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  Speaker 1: know that TikTok is a Chinese company. I can imagine
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  Speaker 1: the Trump administration that Trump campaign knows this as well.
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  Speaker 1: Should we expect a torrent of tweets coming out of
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  Speaker 1: President Trump, you know, saying that Chinese China is interfering
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  Speaker 1: with the election of the campaign. Well, I would always
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  Speaker 1: hesitate to predict what the president is going to do
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  Speaker 1: on Twitter for all the obvious reasons. But I will
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  Speaker 1: say that there was bound to be some really uncomfortable
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  Speaker 1: conversations and probably uncomfortable Sunday at TikTok. When you're owned
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  Speaker 1: by a Chinese company, They've gone to great efforts, including
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  Speaker 1: hiring a very senior executive from Disney to try to
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  Speaker 1: sort of build their brand as not a Chinese own brand.
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  Speaker 1: That's probably the last thing they want to say. And
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  Speaker 1: to be clear, TikTok. TikTok really had nothing to do
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  Speaker 1: with this from a company standpoint. They just provided the platform.
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  Speaker 1: The K pop users or other teenagers provided the excitement
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  Speaker 1: and the energy, and they used the platform in some
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  Speaker 1: ways as the platform was designed to be used, which
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  Speaker 1: is to distribute you know, viral videos, um. But but
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  Speaker 1: in other ways, you know, sort of the use case
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  Speaker 1: in and around politics is certainly not what TikTok likely
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  Speaker 1: had in mind. Jim Anderson, thank you so much for
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  Speaker 1: joining us. Fascinating kind of story here that I'm sure
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  Speaker 1: is going to continue to develop and will continue to follow.
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  Speaker 1: Jim Anderson, CEO of Social Flow, based in New York City, Fannie,
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  Speaker 1: that's just interesting. You think about social media and the
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  Speaker 1: impact that's having obviously across all of our lives over
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  Speaker 1: the past ten years or so, but certainly the political
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  Speaker 1: sphere as well. And we thought it was really limited
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  Speaker 1: to a kind of a Facebook, a Twitter kind of thing,
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  Speaker 1: but here comes TikTok, and each one of these platforms
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  Speaker 1: has a different way of connecting with the audience. And
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  Speaker 1: it may be the same audience and maybe different audiences,
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  Speaker 1: but TikTok content needs to be very different from Twitter
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  Speaker 1: content or Facebook content. And just as a as a
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  Speaker 1: sort of a separate example, you look at Sarah Cooper,
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  Speaker 1: who's the impersonator of Trump. She made her debut really
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  Speaker 1: on TikTok, even though she had been on the other platforms.
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  Speaker 1: It was on TikTok that you really took off and
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  Speaker 1: then transferred to Twitter. Yeah, and as Jim mentioned, TikTok
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  Speaker 1: obviously really popular with the really the the younger demos.
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  Speaker 1: And that's certainly interesting from a political perspective. And it
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  Speaker 1: is time checken with Bloomberg Opinion or Joy Now by
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  Speaker 1: Bloomberg Opinion columnist Neil Ferguson. He's also Senior Fellow at
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  Speaker 1: the Hoover Institution at Stanford University. Noted historian of course,
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  Speaker 1: and author of many many books, from The Ascent of
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  Speaker 1: Money to the House of Rothschild, Too Much much More. Neil,
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  Speaker 1: thanks for joining your latest column. America is on the road,
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  Speaker 1: but whether it's on the road to relapse or recovery
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  Speaker 1: is the question. What say you? Well, maybe both. That's
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  Speaker 1: the same. We can see really to rapid recovery, not
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  Speaker 1: only in some of the obvious nuns like the unemployment
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  Speaker 1: rate or retail sales, but actually mobility data, which is
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  Speaker 1: a great higher frequency tracker of what's happening in the country.
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  Speaker 1: And you can see that just looking at say the
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  Speaker 1: Google data on trips to retail and recreation destination. They're
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  Speaker 1: on track to be back normal by around July ten
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  Speaker 1: or eleventh. And at the same time, what we're seeing
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  Speaker 1: is significant increases in case numbers, not nationwide, but in
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  Speaker 1: particular regions the South, for example, some Western states, and
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  Speaker 1: so we've got both relatively rapid it's not v shaped recovery. Also,
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  Speaker 1: and of course there's a relationship. You're getting this increase
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  Speaker 1: in in case numbers, positive tests and hospitalizations, especially in
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  Speaker 1: states like Aaron Zone, Florida and texass to look like
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  Speaker 1: you've got got a second wave of COVID ninetine in
• 8:02
  Speaker 1: those states, and that that's the problem that we're seeing
• 8:05
  Speaker 1: in the US today. Were rapidly retuble economically, but without
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  Speaker 1: social distending, without masks wearing, people are being somewhat reckless.
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  Speaker 1: By comparison with the europe pensive part. And that's driving
• 8:18
  Speaker 1: in case numbers back up neil to what extent as
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  Speaker 1: the I guess the COVID virus and a response to
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  Speaker 1: it at the state level and the reopening strategies at
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  Speaker 1: the state level, how was that to what extent has
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  Speaker 1: that become politicized? I e. The more conservative UH states
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  Speaker 1: and regions of the country perhaps taken a less stringent
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  Speaker 1: uh COVID response than maybe some of the more democratic
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  Speaker 1: or liberal regions of the country. It's hy politicized more
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  Speaker 1: than I think in any other country that I've I've studied.
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  Speaker 1: Attitudes towards the pandemic itself varies substantially across party lines.
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  Speaker 1: If you look at civics data, Democrats are still really
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  Speaker 1: worried about COVID betein in their area and Republicans really aren't.
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  Speaker 1: You look at the different strategies states have adopted. The
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  Speaker 1: speaking Blue states slower to reopen uh US in touch
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  Speaker 1: lockdowns all along and red states UH less intense locklands
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  Speaker 1: ease earlier reopening. And so what that translates in a
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  Speaker 1: really striking feature, really striking divergence in not only have
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  Speaker 1: them on the recovery, but the second wave problem. Now,
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  Speaker 1: there's a slightly confounding fact here which shares some uh,
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  Speaker 1: some eidemiologists have been commenting on in the last twenty
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  Speaker 1: four hours that part of what makes COVID nineteens spread
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  Speaker 1: a lot is their conditioning teams, and so in states
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  Speaker 1: that are hotter, like Arizona where people actually don't want
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  Speaker 1: to be outside because it's so hot, in mus Try,
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  Speaker 1: in parts of Texas, obviously in Florida, air con use
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  Speaker 1: has gone up in the last couple of months. And
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  Speaker 1: so because of the correlation between red states and hot states,
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  Speaker 1: it's not just a partisan divide that's driving a second
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  Speaker 1: wave in red states. It's also the fact that they're
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  Speaker 1: hot states. Yeah, and I will say our books southerl
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  Speaker 1: Under a great column on that. The other day, Neil
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  Speaker 1: talked to us about the different approaches to reopening around
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  Speaker 1: the world, because obviously, you know, countries can't stay closed forever.
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  Speaker 1: And you have Italy, which was extraordinarily badly hit reopening
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  Speaker 1: and I'm sure they were terrified, but they did it.
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  Speaker 1: The likes of Sweden, which didn't take the same approach whatsoever,
• 10:33
  Speaker 1: and as having sort of different problems. Now, is there
• 10:37
  Speaker 1: a model that's maybe the perfect model. Well, there are
• 10:41
  Speaker 1: certainly better models than the one that the US is adopting,
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  Speaker 1: which my colleague Hoover John Cochin called the dumb reopening,
• 10:49
  Speaker 1: where you just go back to normal without social distancing
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  Speaker 1: really and without mask wearing. If you go all the
• 10:55
  Speaker 1: way to East Asia where the pandemic struck first, the
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  Speaker 1: role more balls of Taiwan and South Korea, which really
• 11:03
  Speaker 1: pioneered early testing and contact tracing, didn't have to do
• 11:06
  Speaker 1: full lockdowns, and in fact, in the case of Taiwan,
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  Speaker 1: have had minimal COVID nine for COVID nineteen fatalities. Europe
• 11:13
  Speaker 1: lies somewhere in the middle, and it is a very
• 11:16
  Speaker 1: picture because you've had pretty disastrous experiences in Italy and
• 11:19
  Speaker 1: Spain and Belgium, whereas in Germany and also interestingly in
• 11:24
  Speaker 1: Greece they quickly cottoned onto the need for for testing
• 11:28
  Speaker 1: and contact tracing. And I think if you look at
• 11:31
  Speaker 1: the European states that have reopened the soonest, and that
• 11:34
  Speaker 1: would include Germany, Austria, Denmark as well as Switzerland, there's
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  Speaker 1: no sign as at this point of second waves in
• 11:44
  Speaker 1: those countries, not in case numbers and certainly not immortality.
• 11:48
  Speaker 1: It's all about jumping on these super spreader events because
• 11:51
  Speaker 1: COVID nineteen is is spread by a relative minority of
• 11:54
  Speaker 1: people who given to a lot of people, like twent
• 11:57
  Speaker 1: of infected people are responsible for eight a send of infections.
• 12:01
  Speaker 1: If you're doing testing and contact tracing, you can get
• 12:04
  Speaker 1: those super spreaders or stop the super spreader events from happening.
• 12:08
  Speaker 1: If you don't do testing and contact tracing in a
• 12:12
  Speaker 1: systematic way, which is the American route that we're going down,
• 12:15
  Speaker 1: it's basically playing lack a mole with a blindfold on,
• 12:18
  Speaker 1: and if you've ever tried that, you'll find that you
• 12:20
  Speaker 1: miss a lot of mold ken you know, at the
• 12:23
  Speaker 1: beginning of this whole issue, here, this whole process of
• 12:26
  Speaker 1: dealing with the pandemic, I was surprised there wasn't a
• 12:28
  Speaker 1: federal response. It was more of a state by state response,
• 12:32
  Speaker 1: and we became accustomed hearing Governor Cuomwell from the State
• 12:34
  Speaker 1: of New York giving this the daily update. Should I
• 12:37
  Speaker 1: have expected a federal response, well, historically, because it's a
• 12:42
  Speaker 1: federal system which devolves a lot of responsibility to state
• 12:47
  Speaker 1: and indeed municipalities. The answer that question, no, really because
• 12:51
  Speaker 1: in all the previous pandemics, whether you look at the
• 12:54
  Speaker 1: Big Influenza or there the other influenza pandemic of fifty
• 12:59
  Speaker 1: seven fifty, it was essentially a decentralized story where state
• 13:04
  Speaker 1: municipalities took their own decisions about how strictly to limit
• 13:08
  Speaker 1: public gatherings. So this is certainly not an unprecedented story.
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  Speaker 1: I do think that the federal government has a role
• 13:15
  Speaker 1: to play, though, and I don't think it played that
• 13:17
  Speaker 1: role very brillian. This is usually blamed on President Trump,
• 13:22
  Speaker 1: I think to access by the media. Clearly his judgment
• 13:25
  Speaker 1: wasn't fantastic, and indeed on some issues it was downright crazy.
• 13:30
  Speaker 1: But if you look at what was going on at
• 13:32
  Speaker 1: the level of the Department of Health and Human Services
• 13:35
  Speaker 1: and look down at CDC, there was a pretty serious
• 13:38
  Speaker 1: public health failure at the federal level. Testing, far from
• 13:41
  Speaker 1: being ramped up, actually was held back by CDC. And
• 13:45
  Speaker 1: I do think there's a lot of questions still to
• 13:48
  Speaker 1: be asked about why it was that HHS generally failed
• 13:53
  Speaker 1: but at least communicate effectively to the states what they
• 13:56
  Speaker 1: needed to do. So no, I think there was a
• 13:58
  Speaker 1: failure at the federal level, even in this system that
• 14:01
  Speaker 1: is relatively de central minded. Neil, thank you so much
• 14:05
  Speaker 1: for joining us. We really appreciate your insight. Neil Ferguson.
• 14:08
  Speaker 1: He's a senior fellow at the Hoover Institution at Stanford University.
• 14:12
  Speaker 1: Also Bloomberg opinion columnists based at their in beautiful Palo
• 14:15
  Speaker 1: out There, California, one of the greatest, most beautiful places
• 14:19
  Speaker 1: in the US. Well, as you know, it's been quite
• 14:23
  Speaker 1: the volatile a few months. Markets underwritten by central banks
• 14:27
  Speaker 1: around the world, and plenty plenty demand four dollars. Let's
• 14:31
  Speaker 1: bring in somebody who knows a little bit about how
• 14:33
  Speaker 1: to put together a portfolio and what to do maybe
• 14:35
  Speaker 1: in an era of such volatility. Down scaley as head
• 14:38
  Speaker 1: of market research and Strategy of Wealth Management, and Morgan
• 14:41
  Speaker 1: Stanley Don thanks for joining. You obviously have plenty of
• 14:44
  Speaker 1: clients that are probably calling you and saying, what do
• 14:47
  Speaker 1: we do, where do we put our our our money
• 14:50
  Speaker 1: to work? What asset classes could benefit us here? What
• 14:53
  Speaker 1: do you say to them? Yeah, good morning, Bonny, and
• 14:56
  Speaker 1: thank you so much for having me on your your
• 14:58
  Speaker 1: show this morning. So a look, we're getting called and
• 15:01
  Speaker 1: we're getting zoomed. Of course now by time, so we're
• 15:04
  Speaker 1: telling them a couple of things. Number One, we're saying
• 15:07
  Speaker 1: that you've seen the big crash and the big euphoric
• 15:10
  Speaker 1: rally back and the big news. The big fireworks are
• 15:13
  Speaker 1: over for now. We think the market is likely to
• 15:16
  Speaker 1: consolidate into a arrange the next three to six months,
• 15:19
  Speaker 1: as the market starts to consider some other factors including
• 15:23
  Speaker 1: what's the rate of change on the reopening amid the reopening,
• 15:28
  Speaker 1: what does the virus flare ups look like? Um. At
• 15:31
  Speaker 1: the same time, you're gonna start to hear more positive
• 15:34
  Speaker 1: progress or potential headlines around vaccines, anti viral therapy. Uh.
• 15:39
  Speaker 1: And so the market is really juggling a lot of factors,
• 15:42
  Speaker 1: both to the upside and the downside, and in some
• 15:45
  Speaker 1: we think that keeps the market rather consolidated at least
• 15:48
  Speaker 1: for the next three or six months. But we do
• 15:50
  Speaker 1: think going into next year, and you've heard Morgan family
• 15:53
  Speaker 1: talk about this extensively now for three months, we do
• 15:56
  Speaker 1: think the overarching theme is a V shaped economic for
• 16:00
  Speaker 1: every going into next year. All right, Dan, So the
• 16:03
  Speaker 1: V shape recovery going into next year, that's you know,
• 16:06
  Speaker 1: at one point that was kind of I would call
• 16:08
  Speaker 1: it consensus initially uh, and then that seemed to fade.
• 16:12
  Speaker 1: Here is the the depths of the pandemic. Any economic
• 16:15
  Speaker 1: data started coming out and people are saying, I don't
• 16:17
  Speaker 1: think that V is gonna happen. Now it seems to
• 16:19
  Speaker 1: be coming back a little bit. What's the the kind
• 16:22
  Speaker 1: of the two or three drivers for you to say
• 16:24
  Speaker 1: a V shape recovery? Sure, it's it's an excellent question,
• 16:29
  Speaker 1: and one I would just highlight we we really reiterated
• 16:32
  Speaker 1: throughout despite potentially you know, changing sentiments among among the consensus.
• 16:37
  Speaker 1: So what's driving the V shape recovery. It's really the
• 16:40
  Speaker 1: size and the scope and the speed of policy. So
• 16:44
  Speaker 1: when you look at fiscal and monetary policy combined, we've
• 16:47
  Speaker 1: already executed around a level around fifty five oh of
• 16:52
  Speaker 1: U s GDP, which we all know it far exceeds
• 16:56
  Speaker 1: any historical stimulus measures in any cycle ever. So that's
• 17:00
  Speaker 1: number one. Number two, we think that the speed of
• 17:04
  Speaker 1: the policy response has been incredibly notable. Why because when
• 17:07
  Speaker 1: you look at precedents like oh A, it took the
• 17:10
  Speaker 1: FED and it took Congress months to put together the
• 17:13
  Speaker 1: emergency playbooks they executed back then, and that unfortunately allowed
• 17:18
  Speaker 1: the credit cycle to deepen. And so what's really different
• 17:20
  Speaker 1: this time is that the policymakers acted immediately. And the
• 17:24
  Speaker 1: fact was the episode of the crisis was health. So
• 17:28
  Speaker 1: it's a completely bipartisan related epicenter and and and something
• 17:32
  Speaker 1: everyone could band together around. And I think that's really crucial, right,
• 17:36
  Speaker 1: because it prevented a health slash economic crisis from morphing
• 17:41
  Speaker 1: into a financial crisis. So the second part of the
• 17:44
  Speaker 1: policy V shaped impact is truly seeing the credit markets
• 17:49
  Speaker 1: and some of the liquidity in the markets, functioning companies
• 17:52
  Speaker 1: accessing capital markets very efficiently as you've seen. And I
• 17:56
  Speaker 1: guess I would say the last part, right is we
• 17:58
  Speaker 1: all know we are a consumer lead economy, and when
• 18:01
  Speaker 1: you look at the initial reaction from consumers who are
• 18:06
  Speaker 1: just starting to reopen and resume normal activities. We saw
• 18:09
  Speaker 1: the retail sales upside surprise recently. We heard a very
• 18:13
  Speaker 1: positive housing and mortgage update at our Morgan Stanley Financials
• 18:17
  Speaker 1: conference recently. We think the consumer is going to come
• 18:20
  Speaker 1: back particularly strong given the pend up demand, and that
• 18:23
  Speaker 1: all informs the V shaped scenario done. What proportion of
• 18:26
  Speaker 1: the people you speak with, both clients and colleagues are
• 18:30
  Speaker 1: concerned about inflation? Very very few, So it's something we
• 18:36
  Speaker 1: don't hear often either from our institutional clients. Were the
• 18:40
  Speaker 1: largest prime broker in the world. We don't hear it
• 18:43
  Speaker 1: very often from our wealth management clients. Perhaps sporadically from
• 18:46
  Speaker 1: the wealth management clients too, are particularly um you know,
• 18:50
  Speaker 1: from business owning backgrounds, etcetera. Who are you know? They're
• 18:54
  Speaker 1: very focused on the deficit as an example, and and
• 18:56
  Speaker 1: that makes sense. But in terms of the overall fears
• 19:00
  Speaker 1: or concerns around inflation, I would say it's very limited.
• 19:04
  Speaker 1: And I think that's another point Morgan Stanley has made
• 19:07
  Speaker 1: in terms of an upside surprise having that policy response,
• 19:11
  Speaker 1: that continuation in policy, particularly on the fiscal side, we
• 19:15
  Speaker 1: do expect a re up of fiscal upwards of a
• 19:18
  Speaker 1: trillion when the some of the benefits expire July month
• 19:22
  Speaker 1: end um. We also would highlight again the consumer demand
• 19:26
  Speaker 1: the recovering commodity markets. We've seen tremendous capital expenditure declines
• 19:32
  Speaker 1: in oil given everything that's happening there now, We've obviously
• 19:36
  Speaker 1: seen a pickup in driving well, I'm sure we'll see
• 19:38
  Speaker 1: eventually a pick up in more airline related transportation fuel
• 19:43
  Speaker 1: demand that will take longer obviously, but it'll happen, and
• 19:46
  Speaker 1: thus you get to see an upward bias towards commodity
• 19:48
  Speaker 1: prices um and then, last but not least, what happens
• 19:51
  Speaker 1: with China. Right, this is really an enormous question mark
• 19:55
  Speaker 1: in terms of capital uh moving around the world, supply
• 19:58
  Speaker 1: chains and to the extent we have supply chain restoring,
• 20:02
  Speaker 1: that's potentially another source of inflation down the road. Hey, Dan,
• 20:06
  Speaker 1: thanks so much for joining us day. We really appreciate
• 20:07
  Speaker 1: your thoughts. We've covered a lot of ground there. Dan Skelly,
• 20:10
  Speaker 1: head of Equity market Model, Portfolios and market Strategy at
• 20:14
  Speaker 1: Morgan Stanley Wealth Manager. They have about two and a
• 20:16
  Speaker 1: half trillion dollars under management, so they get to see
• 20:20
  Speaker 1: a lot of the market. Giving us his thoughts there,
• 20:23
  Speaker 1: And Vonnie, I think the key thing is there Morgan
• 20:25
  Speaker 1: Stanley holding to that V shaped recovery. Yeah. And I'm
• 20:27
  Speaker 1: really fascinated that not more people are just floating the
• 20:31
  Speaker 1: idea of potential inflation. And perhaps it is because Bill
• 20:34
  Speaker 1: Dudley's op ed in Bloomberg Opinion put it in my
• 20:38
  Speaker 1: mind today. But there is a huge balance street out there,
• 20:40
  Speaker 1: and you have to wonder how long it will be
• 20:41
  Speaker 1: before people do start to be concerned about inflation. Yeah,
• 20:45
  Speaker 1: you think about a ten trillion dollar balance. She just extraordinary.
• 20:49
  Speaker 1: We were a below four billion dollars just several months ago.
• 20:54
  Speaker 1: Now we have a very interesting interview for you this
• 20:57
  Speaker 1: as travel begins to ramp up just ever so slowly again, Delta,
• 21:02
  Speaker 1: for example, saying that it was going to restart flights
• 21:04
  Speaker 1: to China via Soul this week. It's only going to
• 21:07
  Speaker 1: be once a week, and then July it will be
• 21:09
  Speaker 1: twice a week. But we are seeing just very small
• 21:12
  Speaker 1: green shoots of travel starting up. Bryantsky is Airbnbs CEO.
• 21:17
  Speaker 1: He is discussing with Bloomberg here now White travel as
• 21:20
  Speaker 1: we know it will never actually be the same. None
• 21:23
  Speaker 1: of us were prepared for really a once in a
• 21:26
  Speaker 1: century crisis. Our industry travel has described COVID as as
• 21:31
  Speaker 1: big as nine eleven and two thousand and eight, many
• 21:33
  Speaker 1: times over, something more akin to World War Two. And
• 21:36
  Speaker 1: when that happened, it felt like I was working on
• 21:39
  Speaker 1: our S one. We were going to file it March
• 21:41
  Speaker 1: thirty one, and it felt like twelve years of success,
• 21:45
  Speaker 1: and you know, had all these things, and life was
• 21:47
  Speaker 1: great and suddenly in you know, you build something in
• 21:51
  Speaker 1: twelve weeks and you lose most of it in four weeks.
• 21:55
  Speaker 1: I can't quite describe what that feels like. And it
• 21:58
  Speaker 1: just felt like everything the company oak. I felt like
• 22:01
  Speaker 1: a captain of a ship in our torpedo just hit
• 22:03
  Speaker 1: the side of the ship. Now, travel came basically to
• 22:06
  Speaker 1: a standstill, and in many cases people didn't want to travel,
• 22:09
  Speaker 1: or they couldn't travel legally. It was illegal to rent
• 22:13
  Speaker 1: an airbnb. What was the lowest point for you? The
• 22:17
  Speaker 1: darkest hour? There were so many dark hours. That's the
• 22:21
  Speaker 1: old like quote attribute to Winston Churchill. If you're going
• 22:23
  Speaker 1: through hell, just keep going and man um I will
• 22:27
  Speaker 1: tell you the first dark moment was when we had
• 22:30
  Speaker 1: about a billion dollars of cancelations from guests. You also
• 22:33
  Speaker 1: had to cut of the company, and you gave you know,
• 22:37
  Speaker 1: an incredibly generous severance package your note to the team.
• 22:41
  Speaker 1: I could I could feel the pain in there, you know,
• 22:45
  Speaker 1: talk to me about going through that process cut your staff.
• 22:50
  Speaker 1: It was the saddest thing I've ever done in my life,
• 22:52
  Speaker 1: at least professionally, and we weren't sure if we'd have
• 22:56
  Speaker 1: to do a layoff and we had to face the
• 22:58
  Speaker 1: hard truth that travel we did not know when it
• 23:03
  Speaker 1: was gonna return, and we knew that when travel returned,
• 23:06
  Speaker 1: it would be different, it would never be the same.
• 23:09
  Speaker 1: You don't think travel will ever be the same, Well, um,
• 23:15
  Speaker 1: I will. I I don't know for sure, but here's
• 23:17
  Speaker 1: what I'll say. Travel will be back, but we'll look different.
• 23:21
  Speaker 1: What trends are you seeing in Europe and Asia versus
• 23:24
  Speaker 1: the United States? So United States has been very, very strong.
• 23:28
  Speaker 1: It's again, I don't want to I want to clarify,
• 23:31
  Speaker 1: it's we. We we cannot declare recovery anywhere because we
• 23:35
  Speaker 1: don't yet know where it's pent up demand in temporary
• 23:39
  Speaker 1: or sustainable recovery. But we've seen a temporary recovery. United States, Europe,
• 23:45
  Speaker 1: most of Europe we've seen a recovery, a temporary recovery.
• 23:48
  Speaker 1: Other than the United Kingdom. United Kingdom I think is
• 23:51
  Speaker 1: still lockdown until July one, But France, Germany, Italy, Spain,
• 23:56
  Speaker 1: you're seeing really strong growth. Um, Latin America is not
• 24:00
  Speaker 1: covered in. Asia is starting to recover but not yet recovered.
• 24:03
  Speaker 1: So North America and Europe are extremely strong. Latin America
• 24:07
  Speaker 1: Asia kind of a bit behind. How much do you
• 24:10
  Speaker 1: think getting back to a normal defense on a vaccine
• 24:13
  Speaker 1: or even then, things are going to be different. Travel
• 24:17
  Speaker 1: as you knew it is over. You're never ever gonna
• 24:20
  Speaker 1: see it again. I'll just say that right there, travel
• 24:22
  Speaker 1: as we knew it from the Valentine's Day and before
• 24:25
  Speaker 1: is over. It's gone. It doesn't mean travel is gone,
• 24:28
  Speaker 1: but that travel is gone, and nobody knows quite what
• 24:31
  Speaker 1: it's going to be because it's really up to the
• 24:33
  Speaker 1: industry to invent the way forward. But again, I think
• 24:36
  Speaker 1: business travel is really really going to be hit for
• 24:38
  Speaker 1: a while. I think a lot of people are realizing
• 24:40
  Speaker 1: they can do meetings on zoom, the rethinking a lot
• 24:43
  Speaker 1: of the conventions and conferences. People are going to rediscover
• 24:46
  Speaker 1: the outdoors. For example, there's four hundred national parks in
• 24:49
  Speaker 1: the country. Most Americans have never been a national park.
• 24:52
  Speaker 1: Most Americans don't even know if they live within two
• 24:54
  Speaker 1: hundred miles in national park. I think one prediction national
• 24:57
  Speaker 1: parks gonna be in People are going to travel a
• 24:59
  Speaker 1: lot more out yours. These are things that are going
• 25:01
  Speaker 1: to happen. And the other thing that I think is
• 25:03
  Speaker 1: going to happen is travel in living are going to
• 25:06
  Speaker 1: blend together. What do I mean, Well, if you can
• 25:08
  Speaker 1: do your job from home, then if you can work
• 25:11
  Speaker 1: from home, you can fearly work from any home anywhere
• 25:14
  Speaker 1: in the world, as long as you're in the right
• 25:15
  Speaker 1: time zone. And so what you're gonna start to see
• 25:18
  Speaker 1: is not just travel redistribution, but you might see and
• 25:21
  Speaker 1: no one can say for sure, population redistribution. People may
• 25:25
  Speaker 1: start moving to small towns and communities. That was a
• 25:29
  Speaker 1: fascinating discussion Airbnb CEO Bryant Chesky speaking with Bloomer Technologies
• 25:34
  Speaker 1: Emily Chang on why travel as we know it will
• 25:36
  Speaker 1: never be the saying that's a big, big statement, Vonni.
• 25:40
  Speaker 1: I wonder how things will in fact play out. I mean,
• 25:42
  Speaker 1: it's good to actually hear the truth, right Poles. So
• 25:45
  Speaker 1: many people pretending that, you know, at some point we
• 25:48
  Speaker 1: will go back to pre pandemic times, but that's never
• 25:51
  Speaker 1: gonna happen. We're never going to be pre pandemic again.
• 25:54
  Speaker 1: And you know, as much as people say these things
• 25:56
  Speaker 1: emerge every twenty years or so, when it's true, this one,
• 25:59
  Speaker 1: for you is different in the sense that it is
• 26:01
  Speaker 1: just so ridiculously easy to catch, and you know, vaccines
• 26:06
  Speaker 1: are so far away. We don't know how long they last.
• 26:08
  Speaker 1: So yeah, I can completely imagine the travel as we
• 26:10
  Speaker 1: knew it, where you just could hop out to the
• 26:12
  Speaker 1: air board, jump on a you know, a shuttle plane
• 26:15
  Speaker 1: down to DC or wherever you wanted to go in
• 26:16
  Speaker 1: the world that's done. Yeah, it'll be interesting to see.
• 26:19
  Speaker 1: I mean, Brian Chesky, Airbnb CEO, he certainly has a
• 26:22
  Speaker 1: great window into global travel trends. I mean, Airbnb is
• 26:26
  Speaker 1: just everywhere, and he was suggesting that certain European markets
• 26:30
  Speaker 1: coming back a little bit sooner than some others. UK
• 26:34
  Speaker 1: still in lockdown, and you're seeing some pockets of strength
• 26:37
  Speaker 1: here in the US. Um. But again, I think the
• 26:40
  Speaker 1: until there is you know, arguably, I think a lot
• 26:43
  Speaker 1: of observers say, until there is a globally available vaccine
• 26:47
  Speaker 1: that you know, just consumer activity in general on a
• 26:49
  Speaker 1: global scale will be greatly reduced or just certainly impacted.
• 26:54
  Speaker 1: And I think that's kind of what we're hearing from
• 26:55
  Speaker 1: the Airbnb CEO. And it's interesting that he hasn't ruled
• 26:58
  Speaker 1: out an i P O this year, but artney, yeah,
• 27:00
  Speaker 1: I'm sure it's not something they're immediately thinking about. Also,
• 27:03
  Speaker 1: that lawsuit with New York City has now been settled
• 27:06
  Speaker 1: about providing host data, and in New York you you
• 27:09
  Speaker 1: have to stay for thirty days now, which also changes
• 27:12
  Speaker 1: the business model. Yeah, absolutely so off to see how
• 27:15
  Speaker 1: that plays out for the good folks at Airbnb. Thanks
• 27:19
  Speaker 1: for listening to Bloomberg Markets podcast. You can subscribe and
• 27:22
  Speaker 1: listen to interviews at Apple Podcasts or whatever a podcast
• 27:25
  Speaker 1: platform you prefer. I'm Bonnie Quinn. I'm on Twitter at
• 27:29
  Speaker 1: Bonnie Quinn. And Paul Sweeney I'm on Twitter at pt Sweeney.
• 27:32
  Speaker 1: Before the podcast, you can always catch us worldwide at
• 27:34
  Speaker 1: Bloomberg Radio