Latest / Bloomberg Intelligence / Sportsmen Oppose Trump's Plan to Rescind Monuments, Fosburgh Says

Transcript

Sportsmen Oppose Trump's Plan to Rescind Monuments, Fosburgh Says · Bloomberg Intelligence

• 0:05
  Speaker 1: Welcome to the Bloomberg p m L Podcast. I'm pim Fox.
• 0:08
  Speaker 1: Along with my co host Lisa Bramowitz. Each day we
• 0:11
  Speaker 1: bring you the most important, noteworthy, and useful interviews for
• 0:15
  Speaker 1: you and your money, whether you're at the grocery store
• 0:17
  Speaker 1: or the trading floor. Find the Bloomberg p m L
• 0:20
  Speaker 1: Podcast on Apple Podcasts, SoundCloud, and Bloomberg dot Com. Well,
• 0:32
  Speaker 1: the Department of Interior is planning to open up national
• 0:36
  Speaker 1: lands and monuments for commercial development. Also on at the
• 0:40
  Speaker 1: table is raising park fees. The Department of the Interior,
• 0:44
  Speaker 1: led by of course Ryan zinky In appointee of the
• 0:48
  Speaker 1: Trump administration, and here to talk about it, as with Fostburg, President,
• 0:51
  Speaker 1: chief executive officer of the Teddy Roosevelt Conservation Partnership, which
• 0:56
  Speaker 1: is based in Washington. With the Teddy Roosevelt Conservation Partnership
• 1:01
  Speaker 1: is focused on preserving areas for use for hunting and fishing,
• 1:07
  Speaker 1: and has in the past welcomed the idea of opening
• 1:12
  Speaker 1: up perhaps some more lands. What's been the response to
• 1:15
  Speaker 1: the latest proposals, Lisa, I think the response has been
• 1:19
  Speaker 1: pretty negative in general. I think the we're in favor
• 1:22
  Speaker 1: of opening up lands for hunting and fishing, but almost
• 1:24
  Speaker 1: all the lands are already open for hunting and fishing.
• 1:27
  Speaker 1: What we really care about is making sure those lands
• 1:29
  Speaker 1: are well managed and that they're you know, good water quality,
• 1:32
  Speaker 1: good wildlife habitat, good connectivity for migration corridors so and
• 1:37
  Speaker 1: good access to get on them. And I think what
• 1:39
  Speaker 1: concerns us is this proposal to open up a lot
• 1:42
  Speaker 1: of these areas, uh to potentially development and to shrink monuments.
• 1:47
  Speaker 1: Is that directly, I think impacts you know, fish wildlife
• 1:50
  Speaker 1: and fish wildlife habitat, and that's the real concern. You
• 1:54
  Speaker 1: know what I just want to pre could start with it.
• 1:55
  Speaker 1: Maybe an example because I know that the President has
• 1:57
  Speaker 1: plans to visit Utah that's in December, and it affects
• 2:02
  Speaker 1: the bear ears in the Grand Staircase escalante A National monuments.
• 2:08
  Speaker 1: Maybe just use that as an example for what you
• 2:11
  Speaker 1: believe is going on and what is likely to happen.
• 2:14
  Speaker 1: And if you can we've in anything to do with
• 2:15
  Speaker 1: the local reaction, that would be useful. Yeah, pim um,
• 2:19
  Speaker 1: I'm gonna take a step back. The Antiquities Act was
• 2:21
  Speaker 1: created under Theodore Roosevelt, and he used that to set
• 2:24
  Speaker 1: aside about two d and thirty million acres of lands
• 2:28
  Speaker 1: across the country. Um, you know, he's during his presidency
• 2:31
  Speaker 1: and things like the Antiquities Acts as the special privilege
• 2:34
  Speaker 1: of the president to sort of add additional protections onto
• 2:38
  Speaker 1: existing public lands. For example, the Grand Canyon National Park
• 2:41
  Speaker 1: was created through an act through the Antiquities Act. And
• 2:45
  Speaker 1: what you know, presidents have used at Democrat Republican ever
• 2:48
  Speaker 1: since Roosevelt's time to protect key areas curious archaeologically, historically,
• 2:54
  Speaker 1: fish and wildlife scientifically. Now, the controversy that we're talking
• 2:57
  Speaker 1: about right now involves several non monuments are created since
• 3:01
  Speaker 1: the nineteen nineties under Clinton and uh, you know both
• 3:05
  Speaker 1: Bushes and then Obama and Bears. Ears you were talking
• 3:09
  Speaker 1: about is about a million and a half acre monument
• 3:11
  Speaker 1: in Utah that is incredibly important to local tribal interests
• 3:14
  Speaker 1: but also spectacularly beautiful, has great wildlife habitat, and the
• 3:20
  Speaker 1: designation that was created was controversial in the locals. Uh,
• 3:23
  Speaker 1: some of the locals who felt that it was quote
• 3:26
  Speaker 1: locking up land. Broadly, you know, the outdoor recreation community
• 3:30
  Speaker 1: supports monument designation. The hunting and fishing community can support
• 3:34
  Speaker 1: it when hunting and fishing are taken care of and
• 3:36
  Speaker 1: in ears ears you know, hunting is provided for in
• 3:39
  Speaker 1: the designation of the monument. So the controversy is whether
• 3:42
  Speaker 1: the president has the authority to go in and reduce
• 3:45
  Speaker 1: or rescind a monument. It has never been done before
• 3:48
  Speaker 1: under major scale, and I think there are a lot
• 3:51
  Speaker 1: of scholars of field that it's not legal. Now, Congress
• 3:53
  Speaker 1: clearly has the authority it wanted to go in and
• 3:55
  Speaker 1: change the monument designation to a national park or get
• 3:58
  Speaker 1: rid of all this together. It can do that, that's
• 4:00
  Speaker 1: not questioned. Can we talk about what the interests are?
• 4:04
  Speaker 1: Who they are who want to develop these particular areas.
• 4:08
  Speaker 1: Is this uh land that is expected to have oil
• 4:11
  Speaker 1: under it? Is it for minerals? Is it for developing homes?
• 4:16
  Speaker 1: I mean, I've been out there and it's uh, it's
• 4:19
  Speaker 1: quite hot, there is not a lot of water, it's
• 4:21
  Speaker 1: not very populated. So so who are these developers? Well,
• 4:25
  Speaker 1: it's not people who are going to build homes, because
• 4:27
  Speaker 1: it days whether it's you know, rescinded from a national
• 4:30
  Speaker 1: monument or reduced. The national minement still public lands. You
• 4:32
  Speaker 1: can't go in and build a house on it. That
• 4:34
  Speaker 1: would require an act with Congress to get rid of
• 4:36
  Speaker 1: that public lands altogether. But what it would do is
• 4:39
  Speaker 1: potentially open the area to oil and gas development, mineral development,
• 4:43
  Speaker 1: more off road vehicle use, you know, things like that,
• 4:46
  Speaker 1: and which have you know, fairly significant potential impacts. I mean,
• 4:49
  Speaker 1: one of the issues here bears years is you know,
• 4:51
  Speaker 1: sort of very well known archaeological areas for Indians and
• 4:55
  Speaker 1: the Native Americans, and what has been going on has
• 4:58
  Speaker 1: been you know, looting for years, going in, eluding all
• 5:01
  Speaker 1: those you know, the sacred artifacts, and in in fact, even
• 5:04
  Speaker 1: the FBI broke up a louding ring back in around
• 5:06
  Speaker 1: two thousand nine. So this is big business. So obviously
• 5:09
  Speaker 1: the criminals are all for, you know, open it back up.
• 5:12
  Speaker 1: But also there's it's an ideological issue. It's the government
• 5:15
  Speaker 1: from d C telling the locals what they can't do
• 5:18
  Speaker 1: on their land. Now. At the same time, I view
• 5:20
  Speaker 1: a little bit differently and that the government in d
• 5:22
  Speaker 1: C protecting that land for future generations, which is by
• 5:25
  Speaker 1: the way, really good for the outdoor recreation economy in
• 5:28
  Speaker 1: Utah and other places. You know what I think of
• 5:30
  Speaker 1: hunting and fishing as part of sort of the uh frankly,
• 5:35
  Speaker 1: gop uh platform in some ways because of the Second
• 5:39
  Speaker 1: Amendment and the idea of being able to go out
• 5:41
  Speaker 1: there and sustain oneself. And I'm just wondering, you know,
• 5:44
  Speaker 1: are you surprised that you find yourself in stark disagreement
• 5:49
  Speaker 1: with the actions of the current administration. Yeah, you know,
• 5:52
  Speaker 1: it's conservation since Roosevelt's time has really been a nonpartisan issue.
• 5:56
  Speaker 1: You've had Democrat Republican presidents do great things for conservation
• 6:01
  Speaker 1: ever since Rosevelt. In fact, you could argue that Richard
• 6:04
  Speaker 1: Nixon is since Rosevelt that you have been the most
• 6:06
  Speaker 1: environmentally progressive president. Not that he really cared about, you know,
• 6:09
  Speaker 1: a conservation, but he saw his way to heal the nation,
• 6:12
  Speaker 1: you know, from the race, riots, from you know, the
• 6:14
  Speaker 1: Vietnam War, all those issues. We released a poll earlier
• 6:18
  Speaker 1: this year at the Western Governors Association and folks can
• 6:20
  Speaker 1: see it at www dot TRCP dot org that interviewed
• 6:24
  Speaker 1: Republican polls through and went out talked to a thousand
• 6:26
  Speaker 1: sportsmen around the nation on attitudes toward conservation, public lands,
• 6:30
  Speaker 1: conservation funding, clean water, and there is basically no difference
• 6:34
  Speaker 1: between Republicans, Democrats, Independence, Trump voters, Clinton voters I mean,
• 6:38
  Speaker 1: conservation always has been a nonpartisan issue. It should be,
• 6:42
  Speaker 1: but politicians tend to try to frame it as a
• 6:45
  Speaker 1: part as an issue or to create cleavages in the
• 6:48
  Speaker 1: community by claiming, gee, this is an attempt to lock
• 6:50
  Speaker 1: something up, or these people really want to take your
• 6:52
  Speaker 1: guns away. I mean, that's all nonsense. I mean, these
• 6:55
  Speaker 1: are common sense conservation actions that enjoy broad you know,
• 6:59
  Speaker 1: bipartisans port with as you mentioned politicians. I wonder if
• 7:03
  Speaker 1: you could just quickly tell the story of Jason Chafe
• 7:06
  Speaker 1: Fits to maybe illustrate what happens when politicians, uh stray
• 7:12
  Speaker 1: from what they are supporters really want to have happened. Yeah, Pim,
• 7:16
  Speaker 1: Jason Chafe is, for those who don't know who he is,
• 7:18
  Speaker 1: was in the Utah Republican who has now left Congress,
• 7:21
  Speaker 1: but was in the Republican leadership um and you know,
• 7:23
  Speaker 1: a pretty virulent anti conservationist in a lot of ways,
• 7:27
  Speaker 1: as much of the Utah delegation is. He introduced a
• 7:30
  Speaker 1: bill HR six one that would have sold off three
• 7:32
  Speaker 1: point three million acres of public lands to reduce the deficit.
• 7:36
  Speaker 1: And I guess he thought it was good politics. It's
• 7:39
  Speaker 1: you know, selling off public lands. As a part of
• 7:41
  Speaker 1: the Republican national platform. But I think eventually a sportsman
• 7:44
  Speaker 1: got pretty sick and tired of, you know, seeing the
• 7:47
  Speaker 1: places they go and hunt and fish, you know, sold
• 7:49
  Speaker 1: off and having that conservation heritage, you know, sort of
• 7:52
  Speaker 1: given away. And so what happened was that a series
• 7:55
  Speaker 1: of rallies happened across the country, but also in Utah
• 7:58
  Speaker 1: and his district. You know, folks really came at him online.
• 8:02
  Speaker 1: And you know it wasn't the traditional broken stock wearing hippies.
• 8:06
  Speaker 1: These were guys in camo and very traditional conservative folks.
• 8:11
  Speaker 1: And you know, Chafis went one went put a post
• 8:13
  Speaker 1: on Instagram dressed in camo holding this hunting dog, basically
• 8:18
  Speaker 1: apologizing and withdrawing his bill. And that was really the
• 8:21
  Speaker 1: first instance where the community has risen up on an
• 8:23
  Speaker 1: issue that didn't involve Second Amendment to really push back
• 8:27
  Speaker 1: on hardcore anti conservation actions. Thanks very much, wit Fostberg
• 8:32
  Speaker 1: giving us an overview of the environmental issues that continued
• 8:36
  Speaker 1: to dog not only Ryan Sinki, the head of the
• 8:38
  Speaker 1: Interior Department, but politicians as well. Wit Fosberg is the
• 8:41
  Speaker 1: president and the chief executive of the Teddy Roosevelt Conservation Partnership.
• 8:46
  Speaker 1: They're based in Washington, d C. Since we're talking about Russia,
• 9:01
  Speaker 1: we're talking about the election today, and we're talking about
• 9:03
  Speaker 1: all sorts of rumors, it's time to talk about fake news,
• 9:06
  Speaker 1: in particular Facebook's strategy to stamp it out. And here
• 9:10
  Speaker 1: joining us is Sarah Fryar, technology reporter, coming to us
• 9:15
  Speaker 1: from bloom Brick News in San Francisco. Sarah, thank you
• 9:17
  Speaker 1: so much for joining us. You wrote this great story
• 9:20
  Speaker 1: taking a look at how Facebook was grappling with these
• 9:25
  Speaker 1: sort of fake news that they've been accused of fostering
• 9:29
  Speaker 1: and disseminating widely. Can you tell us first just what
• 9:32
  Speaker 1: the efforts have been like on Facebook's behalf. Why don't
• 9:36
  Speaker 1: we just start there? So, Facebook doesn't want to be
• 9:40
  Speaker 1: an arbiter of what is true or false itself. It
• 9:42
  Speaker 1: doesn't want to hire people to fact check itself, and
• 9:46
  Speaker 1: it's outsourcing this effort to five separate third parties that
• 9:51
  Speaker 1: get this dashboard of you know, once they log into
• 9:54
  Speaker 1: their personal Facebook accounts, um they have access to this
• 9:58
  Speaker 1: dashboard of basically all of the worst of the worst
• 10:01
  Speaker 1: on the Internet, and they have to go through and
• 10:04
  Speaker 1: market true or false. Now it sounds like that would
• 10:07
  Speaker 1: be a good system, except for the fact that there's
• 10:10
  Speaker 1: so many duplicate stories, Like you know, something on one
• 10:13
  Speaker 1: site gets debunked, but by the time they debunk it,
• 10:16
  Speaker 1: it's on twenty other sites. Uh. And there's not a
• 10:20
  Speaker 1: lot of scale to the operation. These are our firms.
• 10:24
  Speaker 1: They get paid not at all or or up to
• 10:27
  Speaker 1: a hundred thousand dollars a year, which is not that
• 10:30
  Speaker 1: much um for the amount of effort of this problem.
• 10:34
  Speaker 1: And um, it's just a scale of a problem that's
• 10:38
  Speaker 1: getting more international. Governments around the world are starting to
• 10:43
  Speaker 1: realize how they can use Facebook to manipulate and it's
• 10:48
  Speaker 1: just a fraction of the overall. One person told me
• 10:53
  Speaker 1: that they estimate a hundred stories a month are perhaps debunked.
• 10:59
  Speaker 1: So can we just focus just for a second on
• 11:01
  Speaker 1: the company itself. The company Facebook makes money by selling
• 11:05
  Speaker 1: digital advertisement, right, I mean, that's the bread and butter.
• 11:08
  Speaker 1: They've got Instagram, They've got What's App, They've got Facebook Messenger,
• 11:13
  Speaker 1: and then of course Facebook itself. This is a company
• 11:16
  Speaker 1: that what has thirty eight percent net margins. They did
• 11:19
  Speaker 1: thirty three billion in sales last year. They put twelve
• 11:22
  Speaker 1: billion in their pocket that is an amazing number for
• 11:26
  Speaker 1: a company of this size. Is that correct? So our
• 11:30
  Speaker 1: investors really worried about whether there's an investigation into fake news.
• 11:36
  Speaker 1: Maybe they're just worried that somehow the Congress or government
• 11:39
  Speaker 1: officials will get involved and constrain their ability to sell advertising.
• 11:43
  Speaker 1: But other than that, investors don't seem to be bothered
• 11:46
  Speaker 1: by this. No. I mean that you can tell the
• 11:48
  Speaker 1: stock hasn't really reacted to a lot of this. Um
• 11:52
  Speaker 1: the company, the advertising systems of the company. I mean,
• 11:56
  Speaker 1: they're not widely affected by whatever Facebook does for fake news.
• 12:00
  Speaker 1: But you are correct that if the perception of Facebook
• 12:03
  Speaker 1: changes in UH, in Washington or even in the EU,
• 12:08
  Speaker 1: it could cause a lot of a lot of headaches
• 12:11
  Speaker 1: for Facebook in terms of how they monitor their platform
• 12:14
  Speaker 1: and what they have to invest in and how they
• 12:16
  Speaker 1: have to comply with regulation. So it's in Facebook's best
• 12:19
  Speaker 1: interest to look very proactive and self regulate enough that
• 12:24
  Speaker 1: Congress decides that they don't have to. So now their
• 12:27
  Speaker 1: efforts with self regulating on ads, which they announced next week,
• 12:31
  Speaker 1: they're going to add a lot more transparency for political advertising,
• 12:35
  Speaker 1: even though it went way beyond what Zuckerberg initially said
• 12:38
  Speaker 1: he would do after the Russia ads are revealed, it
• 12:42
  Speaker 1: still wasn't enough for a lot of people on Congressional Hill. So, sir,
• 12:47
  Speaker 1: let's talk a little bit specifically about the details of
• 12:49
  Speaker 1: what Facebook's efforts have been. They contracted for one year
• 12:52
  Speaker 1: with PolitiFact, Snopes, ABC News, fact check dot org, and
• 12:56
  Speaker 1: the Associated Press UH to sniff out fake new wos.
• 13:00
  Speaker 1: They are hiring individuals to scour all of different sites.
• 13:04
  Speaker 1: You know, how controversial is this just in terms of
• 13:07
  Speaker 1: defining what fake news is. I mean, it's been used
• 13:10
  Speaker 1: as a political weapon. You know, a lot of people
• 13:13
  Speaker 1: if they don't like something, they call it fake news.
• 13:15
  Speaker 1: Has that become an issue for Facebook? I think it
• 13:19
  Speaker 1: is an issue for Facebook. I mean one of the
• 13:21
  Speaker 1: new partners that they've added is um, you know, self
• 13:24
  Speaker 1: described conservative magazine, according to our sources, the Weekly Standard,
• 13:29
  Speaker 1: And so that sort of gets into the territory. Certainly,
• 13:32
  Speaker 1: some people think that snopes is is an arm of
• 13:35
  Speaker 1: the left wing, and some people think it's really right
• 13:38
  Speaker 1: right wing. Um. But what these sites are attempting to
• 13:42
  Speaker 1: do on Facebook at least is stamp out the worst
• 13:45
  Speaker 1: of the worst, like the stuff that is just so
• 13:48
  Speaker 1: obviously not true. That it's not a matter of opinion, um.
• 13:52
  Speaker 1: But when you get into the very manipulative reports, those
• 13:57
  Speaker 1: are things that are not yet even treated by face
• 14:00
  Speaker 1: fixed system. Real quick. How much is Facebook spending on
• 14:03
  Speaker 1: these efforts? Well, there are the you know, hundrow k
• 14:07
  Speaker 1: year for these groups that they and they plan to
• 14:09
  Speaker 1: extend the contracts. I don't know what they'll be, if
• 14:11
  Speaker 1: they'll be raising that amount, um. But there are some
• 14:14
  Speaker 1: efforts that they are investing in in university sort of
• 14:17
  Speaker 1: as a philanthropic thing to try to help UH news
• 14:22
  Speaker 1: literacy efforts which they think will will help solve this
• 14:25
  Speaker 1: problem too from a different angle. Honestly, not not a
• 14:29
  Speaker 1: lot of monetary investment, but certainly in the communications and
• 14:34
  Speaker 1: public relations side, we're getting a lot. Thanks very much,
• 14:38
  Speaker 1: Sarah Friar as a Bloomberg technology reporter giving us her
• 14:41
  Speaker 1: thoughts and bringing us up to date on Facebook stumbling
• 14:45
  Speaker 1: with its strategy to get rid of fake news. Shares
• 14:47
  Speaker 1: of Facebook or down about the sixteen cents right now,
• 14:50
  Speaker 1: though they are up four over the last month. General
• 15:06
  Speaker 1: Electric has had a terrible year. It has lost about
• 15:08
  Speaker 1: one third of its overall market value, equal to about
• 15:12
  Speaker 1: a hundred billion dollars, the same market cap we were
• 15:15
  Speaker 1: noting before, as bitcoin now enjoys a brook Sutherland joins
• 15:19
  Speaker 1: us now she's in mergers and acquisitions calumnist for Bloomberg
• 15:22
  Speaker 1: gad Fly. You can find our columns at Bloomberg dot com,
• 15:25
  Speaker 1: Slash gad fly or ni gad Fly on the Bloomberg
• 15:28
  Speaker 1: Broken You make an argument here that it suddenly became
• 15:31
  Speaker 1: much easier to imagine a wholesale breakup of General Electric.
• 15:36
  Speaker 1: Can you explain what that would look like and why
• 15:38
  Speaker 1: that looks much more likely now? Sure? So, the idea
• 15:42
  Speaker 1: of a G breakup has been around for years, and
• 15:44
  Speaker 1: I think you know, it has been talked about just
• 15:47
  Speaker 1: in this sort of rush among industrial companies to become simpler,
• 15:51
  Speaker 1: and GE has done a lot of streamlining. It got
• 15:53
  Speaker 1: rid of G capital, got rid of appliances, it got
• 15:56
  Speaker 1: rid of you know, it's water business. But it's still
• 15:58
  Speaker 1: just sort of this big hey myth and the reasons
• 16:01
  Speaker 1: against a breakup where that you had sort of these
• 16:04
  Speaker 1: financial complexities, that you would have a huge tax bill
• 16:08
  Speaker 1: from selling some of these businesses. Not to mention the
• 16:10
  Speaker 1: conglomerate as a whole gets tax benefits. It pays a
• 16:15
  Speaker 1: tax rate in the low single digits, which is kind
• 16:17
  Speaker 1: of nuts for a US company. Um, But then when
• 16:21
  Speaker 1: we're sort of in this period of I don't know
• 16:23
  Speaker 1: if you want to call it desperation or downward spiral
• 16:26
  Speaker 1: or you know, just sort of a serious crisis at
• 16:29
  Speaker 1: g E right now, but maybe it is time to
• 16:32
  Speaker 1: sort of think a little bit more radically and whether
• 16:35
  Speaker 1: this sort of drastic breakup that everyone has has sort
• 16:38
  Speaker 1: of said maybe doesn't make as much sense should actually
• 16:40
  Speaker 1: be considered. If you're going to reset earnings and you're
• 16:43
  Speaker 1: going to really rethink what this company is, do you
• 16:47
  Speaker 1: want to be this giant, sprawling congo conglome where it's
• 16:50
  Speaker 1: still I wonder if Nelson I'm sure Nelson Pelts of
• 16:53
  Speaker 1: try and Fund Management has some views on this. They're
• 16:56
  Speaker 1: the activist investor that have been pushing for changes at
• 16:59
  Speaker 1: General Electric. I wonder if you could just sort of
• 17:01
  Speaker 1: detail for us what are the different parts of of
• 17:04
  Speaker 1: g E, so that we understand at least what is
• 17:06
  Speaker 1: on the table in terms of the company's makeup. Right,
• 17:09
  Speaker 1: they got the power and aviation business, right, jet engines
• 17:13
  Speaker 1: as well as turbines. Then they've got industrial sales, which
• 17:18
  Speaker 1: so then I mean, go ahead. The main businesses are power, aviation, healthcare, transportation,
• 17:25
  Speaker 1: and then they have sort of these smaller energy connections
• 17:27
  Speaker 1: slash lighting businesses, and on the face of it, those
• 17:31
  Speaker 1: don't necessarily have a lot to do together. Building locomotives
• 17:34
  Speaker 1: may not necessarily combined with healthcare. Yeah exactly. But so,
• 17:40
  Speaker 1: I mean what G has said is, okay, well, we
• 17:42
  Speaker 1: get benefits from being a conglomerate. So a good example
• 17:45
  Speaker 1: of this is their digital effort. They're trying to make
• 17:48
  Speaker 1: their machinery run more efficiently and sell software to other
• 17:51
  Speaker 1: industrial companies so that they can be more productive. So
• 17:54
  Speaker 1: G has said, well, we borrow technologies from the different
• 17:57
  Speaker 1: businesses and sort of share that expertise, and as a whole,
• 18:01
  Speaker 1: we have more resources to put towards this digital investment
• 18:04
  Speaker 1: than our individual businesses. Every time you hear the word
• 18:06
  Speaker 1: digital in any kind of you know, corporate strategy report,
• 18:10
  Speaker 1: that's got to kind of just make you think, well,
• 18:13
  Speaker 1: what were you doing before? Right? Yeah, I mean, I
• 18:15
  Speaker 1: do think that this has been sort of a new
• 18:17
  Speaker 1: wave in industrials and certainly does need to be investing
• 18:21
  Speaker 1: in digital. But the point I make in my article
• 18:23
  Speaker 1: is that they're sort of changing the way that they
• 18:26
  Speaker 1: view digital and that maybe they're sort of rethinking how
• 18:29
  Speaker 1: exactly they want to play in this field. And then
• 18:31
  Speaker 1: that raises the prospect of really whether you do still
• 18:34
  Speaker 1: need to be this concoperate. Well, let's talk about what
• 18:36
  Speaker 1: would happen to the parts of General Electric should they
• 18:40
  Speaker 1: decide to break it up. Would it mean selling the
• 18:42
  Speaker 1: different components to other big corporations that specialize in those areas,
• 18:47
  Speaker 1: or does it mean spinning them all off into their
• 18:50
  Speaker 1: own entities. I think you could do it both ways.
• 18:54
  Speaker 1: I think that it's sort of crazy to think about
• 18:56
  Speaker 1: selling g E for parts, but there are you know,
• 18:59
  Speaker 1: per apps companies out there that would be interested in it. UM,
• 19:02
  Speaker 1: specifically the aviation piece. There's already been sort of speculation
• 19:06
  Speaker 1: about whether g OF Aviation should combine with Honeywell Aerospace. UM.
• 19:10
  Speaker 1: We've seen United Technologies buying Rockwell Collins and getting a
• 19:14
  Speaker 1: lot bigger in the field of aerospace parts, So there
• 19:16
  Speaker 1: could be some appetite for that. You know, maybe that
• 19:19
  Speaker 1: you could do some sort of joint venture with Power.
• 19:21
  Speaker 1: Maybe some of these could stand alone. You know, it's
• 19:24
  Speaker 1: crazy to think about, but if we're really thinking about
• 19:27
  Speaker 1: rethinking what g E is, then maybe we should be
• 19:31
  Speaker 1: having some of these conversations because you know, in its
• 19:33
  Speaker 1: disastrous third quarter earnings report earlier this month, what happened
• 19:37
  Speaker 1: was the power and oil and gas business were just
• 19:40
  Speaker 1: disastrous and totally dragged down the numbers. But the aviation
• 19:43
  Speaker 1: and healthcare business, we're actually doing really well and they're
• 19:46
  Speaker 1: growing and there are sort of opportunities there. So the
• 19:49
  Speaker 1: longer you sort of continue in this structure, you're going
• 19:52
  Speaker 1: to still have that dynamic. And so do you need
• 19:55
  Speaker 1: to maybe think about should we just be an aviation
• 19:58
  Speaker 1: and healthcare company or just to the Asian company or
• 20:01
  Speaker 1: whatever it is. Well, what they everyone should do is
• 20:03
  Speaker 1: they should just read your column. Thank you very much.
• 20:05
  Speaker 1: Brooks Sutherland is a Blueberg Gadfly columnists covering the industrial
• 20:09
  Speaker 1: space and shares a g year down about one percent
• 20:12
  Speaker 1: right now. There was a headline on the Bloomberg over
• 20:27
  Speaker 1: the weekend that read, bond traders confront fears in week
• 20:31
  Speaker 1: that may change everything. They were talking, of course, about
• 20:35
  Speaker 1: the numerous bits of information actions that are coming up
• 20:39
  Speaker 1: this week that could potentially shift the tone of markets dramatically.
• 20:44
  Speaker 1: And here to give us his take on what to
• 20:47
  Speaker 1: pay the most attention to among all of this information
• 20:50
  Speaker 1: is Mike Colland, chairman of Holland and Company, which is
• 20:54
  Speaker 1: based in New York, and just by way of background,
• 20:57
  Speaker 1: Mike had spent a long time at JP Morgan managing
• 21:01
  Speaker 1: both equity and fixing commons assets for major institutional clients,
• 21:04
  Speaker 1: former CEO of First Boston Asset Management as well as
• 21:08
  Speaker 1: chairman of Solomon Brothers Asset Management. So a lot of
• 21:11
  Speaker 1: experience under your belt, Mike. This week, we're looking at
• 21:16
  Speaker 1: a possible tax plan, We're looking at the indictment of
• 21:19
  Speaker 1: Paul mana Fort, We're looking at a possible nomination of
• 21:22
  Speaker 1: a new FED chair. What are you looking at as
• 21:26
  Speaker 1: having the most potential to truly royal markets? Uh? To
• 21:31
  Speaker 1: keep the markets? To change your question, Lisa, well, do
• 21:34
  Speaker 1: is say? What? What would keep the markets from staying unroyaled,
• 21:38
  Speaker 1: if you will, with all the bad headlines over the
• 21:39
  Speaker 1: last several months, is continuing economic growth? I think to
• 21:44
  Speaker 1: get your questions specifically, the one thing that could really
• 21:47
  Speaker 1: did knock the pins out from underneath this market would
• 21:50
  Speaker 1: be a clear message that the tax reform package is
• 21:55
  Speaker 1: going to be scuttled. I think that's the that's the
• 21:58
  Speaker 1: one thing. The markets are are absolutely ignoring a lot
• 22:02
  Speaker 1: of the other stuff that that might have in other
• 22:04
  Speaker 1: markets have have said, let's let's take the market down
• 22:06
  Speaker 1: a little bit. Here in this market, nothing has seemed
• 22:09
  Speaker 1: to face it because the economic numbers have been very good,
• 22:12
  Speaker 1: and people believe that despite all the craziness in Washington,
• 22:15
  Speaker 1: there will be a tax package. If there is none
• 22:17
  Speaker 1: that would that would be my my biggest whirling factor. Okay,
• 22:21
  Speaker 1: so so please build on that, Mike. Which sectors do
• 22:23
  Speaker 1: you think would sell off the most should we get
• 22:26
  Speaker 1: some clear sense that tax reform tax cuts are off
• 22:30
  Speaker 1: the table. Well, I think it would be across the board, Lisa,
• 22:33
  Speaker 1: But I think probably the ones that would have gone
• 22:35
  Speaker 1: up the most would go would go down the most.
• 22:37
  Speaker 1: That's usually what happens in a market reaction like that.
• 22:40
  Speaker 1: It's it's it's it's pretty uh, it's pretty symmetrical. Hey, Mike,
• 22:46
  Speaker 1: excuse me, Mike. I just got this image of you
• 22:49
  Speaker 1: though using your Apple iPhone. I know you've probably already
• 22:52
  Speaker 1: gotten lines for the new Apple the you know, the
• 22:54
  Speaker 1: iPhone ten. You got that You're wearing your under armour
• 22:58
  Speaker 1: outfit right now because you had way too many oreos
• 23:01
  Speaker 1: over the weekend, along with that Ritz Cracker chaser and
• 23:04
  Speaker 1: you and you paid for it all using your master cards.
• 23:07
  Speaker 1: So now we've completed the earnings report for this week,
• 23:09
  Speaker 1: lets you get the Friday non farm payrolls for October.
• 23:12
  Speaker 1: What's not to like about a market? Apple? Come on?
• 23:15
  Speaker 1: Apple is up more than so far this year. We'll
• 23:18
  Speaker 1: get the Mondalese results today after the close under armour
• 23:22
  Speaker 1: also tomorrow, master card tomorrow. What's not to like about
• 23:26
  Speaker 1: this market? Come on him? You know me too well,
• 23:29
  Speaker 1: and thank you for answering your question. It was it
• 23:32
  Speaker 1: was Ah, I think starting with the the Apple, You're
• 23:35
  Speaker 1: absolutely right. On Friday, I did get in linea paid
• 23:38
  Speaker 1: UH paid up front for the UH for the honor
• 23:41
  Speaker 1: of buying this very expensive phone. But I actually believe
• 23:45
  Speaker 1: that that I heard something on Friday out of Apple,
• 23:47
  Speaker 1: Tim that is something they talked about the pre orders
• 23:51
  Speaker 1: in the We're off the charts. I mean this is
• 23:54
  Speaker 1: I've never heard a company of Apple size ever say
• 23:58
  Speaker 1: anything quite like that. And this morning, just in the
• 24:01
  Speaker 1: last hour or two, it's it's important. I haven't heard
• 24:04
  Speaker 1: it reported too much elsewhere UH that the UH five
• 24:08
  Speaker 1: to six week delay or or shipment period. That that
• 24:12
  Speaker 1: those of us who didn't get in line right at
• 24:13
  Speaker 1: three three am in the morning. Uh, we're we're told
• 24:16
  Speaker 1: would would be the normal. So first or second week
• 24:19
  Speaker 1: in December. Apparently that not not only has not budget
• 24:23
  Speaker 1: but and will is not lengthening despite the off the
• 24:26
  Speaker 1: charge orders. But in fact the the uh comment has
• 24:31
  Speaker 1: come out of Apple that they have told the Taiwan
• 24:34
  Speaker 1: manufacturers who supply the important parts to double capacity because
• 24:39
  Speaker 1: of the orders. So these are all very important data
• 24:43
  Speaker 1: points for you know, you and I have been in
• 24:46
  Speaker 1: this market long enough. When everything sounds so good about
• 24:48
  Speaker 1: a company like Apple, we get very concerned that things
• 24:51
  Speaker 1: are about to go bump in the night. But but
• 24:53
  Speaker 1: at least today, for all the facts that we have, uh,
• 24:56
  Speaker 1: the story with Apple continues to get a little bit
• 24:58
  Speaker 1: better despite the fact that stock is up. Mike, did
• 25:01
  Speaker 1: you really get in line at three am? Wow? That
• 25:05
  Speaker 1: was like wow, that the whole new image of you
• 25:08
  Speaker 1: springs up. But you had to you had it was
• 25:10
  Speaker 1: a midnight California time. You had you could preorder on
• 25:14
  Speaker 1: your phone. And I just later in the day, actually, okay,
• 25:18
  Speaker 1: I did. I went to Grand Central to the Apple
• 25:20
  Speaker 1: Store around noontime and just had them help me preorder it. So, Mike,
• 25:25
  Speaker 1: you know a few great tech companies. Uh An economy
• 25:28
  Speaker 1: does not make right. So we are getting economic data
• 25:31
  Speaker 1: and it has been better than a lot of analysts
• 25:34
  Speaker 1: have been expecting. But this is messy data, right because
• 25:38
  Speaker 1: it's being clouded by the hurricanes and the aftermath. And
• 25:41
  Speaker 1: I have to wonder. You know, we are seeing a
• 25:44
  Speaker 1: flattening Yeel curve that continues to flatten. You know what
• 25:47
  Speaker 1: a bond trader seeing. The stock traders just aren't. But
• 25:51
  Speaker 1: I think you put your put your finger on a
• 25:53
  Speaker 1: very important additional data point, Lisa. That was the the
• 25:58
  Speaker 1: g d P number that just came out. A lot
• 26:00
  Speaker 1: of the forecasters were saying that that two point eight
• 26:02
  Speaker 1: two point nine GDP thing was going to be harmed
• 26:05
  Speaker 1: dramatically by the by the effects of the hurricane, which
• 26:08
  Speaker 1: we're disastrous, and yet we came in with a very
• 26:12
  Speaker 1: surprising to me anyhow three percent number. Many people said
• 26:15
  Speaker 1: that you weren't going to see a three handle on
• 26:17
  Speaker 1: this thing. I think I think the most important point
• 26:19
  Speaker 1: for concern of the UH bond trading community, Lisa, would
• 26:24
  Speaker 1: be uh an article in today's Wall Street Journal reflects,
• 26:28
  Speaker 1: you know, the possibility that things are so good we're
• 26:31
  Speaker 1: beginning to get some inflation now that inflation has been
• 26:34
  Speaker 1: uh predicted by many barished people over the last ten
• 26:39
  Speaker 1: years and hasn't occurred, but at some point it probably
• 26:42
  Speaker 1: will happen. That would be that would be the most
• 26:46
  Speaker 1: significant thing for bond traders to figure out how not
• 26:48
  Speaker 1: to lose money at that point. Hey, Mike, do you
• 26:51
  Speaker 1: think that bond traders actually buy anything from Amazon and
• 26:53
  Speaker 1: get their products shipped by FedEx and ups because they
• 26:56
  Speaker 1: both raised their rates and also Netflix raised the subscription
• 26:59
  Speaker 1: rate ten percent. I mean they may be small and anecdotal,
• 27:02
  Speaker 1: but I mean this is stuff that people pay for.
• 27:04
  Speaker 1: That's how these things started. You and I have been
• 27:06
  Speaker 1: through these markets before, and there's no question that that
• 27:10
  Speaker 1: people are beginning to have trouble finding people to work
• 27:14
  Speaker 1: in new job openings in their companies means that they're
• 27:17
  Speaker 1: paying up. Is it a board meeting last week? People
• 27:21
  Speaker 1: are are adjusted. We simply that this company adjusted uh
• 27:25
  Speaker 1: the current wage picture up. I think that's going on,
• 27:30
  Speaker 1: but it's the right now. It's anecdotal, it's not it's
• 27:33
  Speaker 1: not hit the faction. But I think it'll hit the
• 27:35
  Speaker 1: fact sometime in our lifetime, and it maybe sooner than
• 27:38
  Speaker 1: we think. Who knows. Thanks very much, Mike Holland of
• 27:41
  Speaker 1: Mike Holland and Company. Thanks for listening to the Bloomberg
• 27:46
  Speaker 1: p n L podcast. You can subscribe and listen to
• 27:49
  Speaker 1: interviews at Apple Podcasts, SoundCloud, or whatever podcast platform you prefer.
• 27:54
  Speaker 1: I'm Pim Fox. I'm on Twitter at pim Fox. I'm
• 27:57
  Speaker 1: on Twitter at Lisa Abramo. WIT's one before the podcast.
• 28:01
  Speaker 1: You can always catch us worldwide on Bloomberg Radio