Latest / Bloomberg Intelligence / Ukraine Call Summary, Impeachment Inquiry, & GBF

Transcript

Ukraine Call Summary, Impeachment Inquiry, & GBF · Bloomberg Intelligence

• 0:02
  Speaker 1: Welcome to the Bloomberg Penel podcast. I'm Paul swing you
• 0:05
  Speaker 1: along with my co host Lisa Brahma Waits. Each day
• 0:07
  Speaker 1: we bring you the most noteworthy and useful interviews for
• 0:10
  Speaker 1: you and your money. Whether at the grocery store or
• 0:12
  Speaker 1: the trading floor. Find a Bloomberg Penl podcast on Apple
• 0:15
  Speaker 1: podcast or wherever you listen to podcasts, as well as
• 0:17
  Speaker 1: at Bloomberg dot com. Let's dive deeper into those headlines.
• 0:21
  Speaker 1: When we get the rough transcript of the president's call
• 0:25
  Speaker 1: with the Ukraine. We welcome Alex Wayne, Bloomberg News based
• 0:27
  Speaker 1: in Washington, d C. Alex, thanks so much for joining us.
• 0:30
  Speaker 1: Just give us your kind of initial response to kind
• 0:32
  Speaker 1: of what we're seeing here across the tape. Well, this uh,
• 0:35
  Speaker 1: this transcript uh really supports the allegations that have been
• 0:40
  Speaker 1: made that the President pressured Ukraine to investigate a political rival,
• 0:44
  Speaker 1: Joe Biden. The President brought up Biden this phone call,
• 0:48
  Speaker 1: mentioned his name repeatedly, and asked to uk for the
• 0:51
  Speaker 1: new Ukrainian president to reopen a an investigation that had
• 0:56
  Speaker 1: gone dormant um back in or so uh, involving a
• 1:01
  Speaker 1: company tied to Joe Biden's son hunter Biden. So, is
• 1:05
  Speaker 1: there any sense, Alex that there was a threat of
• 1:09
  Speaker 1: withholding aid to Ukraine unless these this investigation did proceed.
• 1:14
  Speaker 1: That there's no explicit threat like that in documented in
• 1:18
  Speaker 1: this phone call. But but let's back up just a
• 1:21
  Speaker 1: step before this call. According to people familiar with the matter,
• 1:25
  Speaker 1: the President froze that that military age Ukraine had happened
• 1:29
  Speaker 1: at least a week before the call. Uh now now
• 1:32
  Speaker 1: that the President of Ukraine gives no indication in the
• 1:35
  Speaker 1: call that he's aware the age has been frozen. At
• 1:37
  Speaker 1: one point he early in the call, he thanks President
• 1:40
  Speaker 1: Trump for US support for Ukraine and says he's uh,
• 1:44
  Speaker 1: he's almost ready to buy more Javelin anti tank missile
• 1:47
  Speaker 1: systems from the United States. The President responds by saying,
• 1:51
  Speaker 1: I would like you to do us a favor, though,
• 1:52
  Speaker 1: because our country has been through a lot in Ukraine
• 1:54
  Speaker 1: knows a lot about it, and he then asks Zelensky
• 1:58
  Speaker 1: to locate this d N the server that was hacked
• 2:01
  Speaker 1: during campaign. We're not sure what the President was getting
• 2:05
  Speaker 1: at there, um, but that then leads into a conversation
• 2:09
  Speaker 1: about other investigations Ukraine could conduct on the President's behalfs
• 2:13
  Speaker 1: including uh, including the Joe Biden probe. Yeah. Right now
• 2:17
  Speaker 1: we're looking at SMP right now, the SMP trading lower,
• 2:21
  Speaker 1: sharply lower on the heels of this transcript release. I'm
• 2:25
  Speaker 1: just wondering, based on what we've heard, based on the law,
• 2:30
  Speaker 1: is what's in the transcript enough to give further ammunition
• 2:33
  Speaker 1: to the Democrats and their impeachment push, or is this
• 2:36
  Speaker 1: sort of edifying for President Trump that he didn't necessarily verbatim,
• 2:42
  Speaker 1: threatened to withhold aid in return for further investigation. So, so,
• 2:47
  Speaker 1: impeachment is more of a political process than a legal process.
• 2:50
  Speaker 1: The Constitution says the president can impeach for high crimes
• 2:53
  Speaker 1: and misdemeanors, but leaves it to Congress to decide what
• 2:55
  Speaker 1: those are. Uh. So, I don't I don't know if
• 2:57
  Speaker 1: the President violated a law. Here. We y're told that
• 3:00
  Speaker 1: the Department of Justice conducted an investigation um into whether
• 3:05
  Speaker 1: the President violated campaign finance law by soliciting the President
• 3:09
  Speaker 1: of Ukraine's help investigating Joe Biden, and do o J
• 3:13
  Speaker 1: determined that he didn't. Uh. But we're also told that
• 3:15
  Speaker 1: at the time d o J conducted this investigation, they
• 3:18
  Speaker 1: were not aware that the president had frozen military aid
• 3:21
  Speaker 1: to Ukraine head of a call. UM, So I you know,
• 3:25
  Speaker 1: I would say this is squarely within the realm of
• 3:28
  Speaker 1: things that Congress would scrutinize. Uh. One of the Commerce's
• 3:32
  Speaker 1: highest responsibilities is to conduct over stud of the executive branch.
• 3:36
  Speaker 1: And UH. I think if any president had having had
• 3:39
  Speaker 1: behaved like this in a phone call with a foreign leader, UM,
• 3:42
  Speaker 1: it would very well rise the level of investigation by Congress.
• 3:48
  Speaker 1: So is it the sense here? You know? The next steps?
• 3:51
  Speaker 1: I guess it's probably the question we have the president.
• 3:52
  Speaker 1: I believe it's going to have a press Commerce today
• 3:55
  Speaker 1: at four pm Eastern. UH. Any expectations here about the
• 4:00
  Speaker 1: tax team might take, well, he's been he's been very
• 4:03
  Speaker 1: defensive so far about his call with Lensky. He's called
• 4:06
  Speaker 1: it a perfect call. So he did nothing wrong. I
• 4:09
  Speaker 1: don't know why he calls it a perfect call given
• 4:12
  Speaker 1: what is right here on on the page that I'm
• 4:14
  Speaker 1: looking at, showing that he he asked a foreign leader
• 4:17
  Speaker 1: to investigate a political arrival. That's that's not a normal
• 4:20
  Speaker 1: thing for a president to ask of a of a
• 4:22
  Speaker 1: foreign a foreign leader. Actually, Alex, that's what I wanted
• 4:25
  Speaker 1: to ask you, I mean, is there a president for this?
• 4:27
  Speaker 1: I've never heard of one. I've I've never heard of
• 4:29
  Speaker 1: something like this happening before. I'm not aware of a
• 4:33
  Speaker 1: previous president, at least in modern US history, Uh, asking
• 4:36
  Speaker 1: a foreign leader to get involved in a U S election.
• 4:41
  Speaker 1: So one of the issues that that Tim O'Brien Bloomberg
• 4:44
  Speaker 1: opinion columnists put in a column yesterday was the big
• 4:47
  Speaker 1: issue is to focus on the fact that don't focus
• 4:50
  Speaker 1: necessarily on whether there was a quid pro quo asked
• 4:53
  Speaker 1: by President Trump, focused more on the fact that the
• 4:56
  Speaker 1: call was made to ask a foreign government to interfere
• 4:59
  Speaker 1: in an election, and that in and of itself, is
• 5:03
  Speaker 1: uh an impeachable or could could support an impeachment process.
• 5:07
  Speaker 1: Is that the thinking within Washington? Or does the quid
• 5:10
  Speaker 1: pro quel really need to be proven? Uh? No, I
• 5:13
  Speaker 1: think I think Democrats definitely feel like there doesn't have
• 5:17
  Speaker 1: to be a quid per quoil, that that's simply inviting
• 5:20
  Speaker 1: or or asking a foreign leader to to get involved
• 5:24
  Speaker 1: in in an election. Um is enough on its face,
• 5:27
  Speaker 1: but but let's also let's also kind of you know,
• 5:30
  Speaker 1: you could almost you can almost say that the quid
• 5:31
  Speaker 1: per quota is already established. The Ukraine is dependent on
• 5:35
  Speaker 1: American military aid. If the President of the United States
• 5:38
  Speaker 1: calls up the president of Ukraine and asked him to
• 5:40
  Speaker 1: do something, there is a there is even if he
• 5:43
  Speaker 1: doesn't make the threat explicit, there is an implication that
• 5:47
  Speaker 1: US aid maybe at risk if the Ukrainian president doesn't
• 5:50
  Speaker 1: agree to do whatever the American President is asking me
• 5:53
  Speaker 1: to do. So, so the quid pro quo is there.
• 5:56
  Speaker 1: It's implied even without the President explicitly threatening the Ukrainian president. So, Alex,
• 6:03
  Speaker 1: what's the next step here? Well, the next step is
• 6:06
  Speaker 1: that there's there's going to be a lot of work
• 6:07
  Speaker 1: on on the on in the House of Representatives by
• 6:10
  Speaker 1: multiple committees um to to apparently as symbol a case
• 6:14
  Speaker 1: for impeachment of of the president. Any support by Republicans
• 6:20
  Speaker 1: there is none so far, but uh, you know, at
• 6:24
  Speaker 1: least at least one Republican, Mitt Romney of of Utah
• 6:26
  Speaker 1: Senter Mitt Romney of Utah has has raised some concerns
• 6:31
  Speaker 1: about what happened in this phone call with the President
• 6:33
  Speaker 1: of Ukraine UH and has said he would reserve judgment
• 6:36
  Speaker 1: on on any consequences until after the facts had were gathered,
• 6:40
  Speaker 1: and so we're we're gathering those facts now. We we
• 6:43
  Speaker 1: think that by the end of the week will also
• 6:46
  Speaker 1: have uh this whistleblower complaint. Uh. An intelligence community whistle
• 6:50
  Speaker 1: whistle blower made a complaint to the Inspector General for
• 6:54
  Speaker 1: the Intelligence community based on in part this call between
• 6:59
  Speaker 1: Trump and the press of Ukraine as well as other events.
• 7:03
  Speaker 1: UH and uh and and that complaint has been demanded
• 7:06
  Speaker 1: by by Democrats in Congress. Alex Wayne, thank you so much,
• 7:10
  Speaker 1: alex Wayne. White House reporter based in Washington, d C.
• 7:27
  Speaker 1: Certainly there is a lot of interest in President Trump's
• 7:32
  Speaker 1: phone call with Ukraine, at the transcript of which was released.
• 7:35
  Speaker 1: Joining us now to discuss Justin sink Bloomberg News, White
• 7:38
  Speaker 1: House reporter, Justin. Have have we gotten any responses yet
• 7:41
  Speaker 1: from either the White House Republicans or Democrats? Uh, in
• 7:45
  Speaker 1: the wake of the release of this transcript. Yeah. So,
• 7:49
  Speaker 1: I think obviously a lot of Democratic lawmakers are expressed
• 7:53
  Speaker 1: and outrage over what they see is the President acting
• 7:56
  Speaker 1: inappropriately by asking Ukraine to participate in this investigation of
• 8:01
  Speaker 1: Joe Biden. The President his allies, though, have kind of
• 8:05
  Speaker 1: insisted throughout this process that the President didn't do anything wrong.
• 8:09
  Speaker 1: They say, uh, that it's normal operating procedure or within
• 8:14
  Speaker 1: the bounds of acceptability for the president to um push
• 8:18
  Speaker 1: for an investigation when there's possible wrongdoing. And they make
• 8:22
  Speaker 1: the argument that the five page transcript shows that the
• 8:25
  Speaker 1: President didn't necessarily link his freezing of foreign aid or
• 8:30
  Speaker 1: even foreign aide generally with the buying investigation, although he
• 8:35
  Speaker 1: does discuss both topics on the on the call and
• 8:38
  Speaker 1: Justin's isn't you know, isn't simply the fact that the
• 8:41
  Speaker 1: president asked the President Trump asked the leader of a
• 8:44
  Speaker 1: foreign nation to potentially interfere in a U S election.
• 8:47
  Speaker 1: Isn't that in and of itself? Uh problematic and maybe
• 8:51
  Speaker 1: even enough to support impeachment. I mean, that's certainly the
• 8:55
  Speaker 1: argument that the critics of the president are making today
• 8:57
  Speaker 1: and that uh, you know, Democrats, including Hillary Clinton, have
• 9:02
  Speaker 1: set our grounds for impeachment. Now, the President says and
• 9:07
  Speaker 1: has defended himself by arguing that there was possible misconduct
• 9:12
  Speaker 1: by by Joe Biden that hasn't been sort of substantiated.
• 9:15
  Speaker 1: All of our reporting indicates that, uh, Joe Biden made
• 9:18
  Speaker 1: the call to to get rid of a prosecutor in Ukraine. Uh,
• 9:23
  Speaker 1: not based on his son's financial interests, but based on
• 9:27
  Speaker 1: the policy within the Obama administration. But but the White
• 9:31
  Speaker 1: House is going to make the argument that that this
• 9:33
  Speaker 1: was just sort of, uh an attempt by this White
• 9:36
  Speaker 1: House to to address possible corruption. Have we already think
• 9:39
  Speaker 1: from Republican leaders. Republican leaders so far have have sort
• 9:44
  Speaker 1: of downplayed the police this and are are making the
• 9:47
  Speaker 1: argument that Democrats are sort of singularly focused on impeaching
• 9:51
  Speaker 1: the president. It's it's a very similar um approach to
• 9:55
  Speaker 1: what we heard in the aftermath of the Mala report
• 9:58
  Speaker 1: coming out, where again the President engaged in some conduct
• 10:01
  Speaker 1: that um was certainly outside the sort of norms that
• 10:04
  Speaker 1: we we expect, but didn't rise the level of illegality.
• 10:08
  Speaker 1: And so they're making the areament that Democrats are uh
• 10:12
  Speaker 1: pushing too hard for this impeachment issue. So justin many
• 10:15
  Speaker 1: observers have suggested that the more damning piece of evidence
• 10:19
  Speaker 1: maybe the whistleblowers report per se, is there sense of
• 10:23
  Speaker 1: when if that will be released and will be releasing
• 10:26
  Speaker 1: its entirety, Yeah, so we're not entirely sure when the
• 10:29
  Speaker 1: public will get a chance to look at or if
• 10:32
  Speaker 1: the politic will get a chance to look at this
• 10:33
  Speaker 1: whistle blower report. But there is an expectation that the Congress,
• 10:37
  Speaker 1: which is holding hearings tomorrow on this issue, will will
• 10:40
  Speaker 1: at least in a classified setting, be able to review
• 10:43
  Speaker 1: uh some if not all, of the whistle blower report.
• 10:45
  Speaker 1: So we we may get additional details that can help
• 10:49
  Speaker 1: give a bigger picture of what the Trump White House
• 10:53
  Speaker 1: was up to and what the president was up to
• 10:55
  Speaker 1: beyond this this specific called transcript as soon as tomorrow.
• 10:59
  Speaker 1: Just and is there any precedent that we can look
• 11:02
  Speaker 1: to in terms of how the president's phone call went
• 11:07
  Speaker 1: or didn't go according to the way it should have
• 11:10
  Speaker 1: I mean, in other words, uh, does the law or
• 11:13
  Speaker 1: precedent offer any guidance for us. So another interesting kind
• 11:19
  Speaker 1: of piece of information that came out today is that
• 11:22
  Speaker 1: the Justice Department, because of this whistleblower um flagging concern
• 11:27
  Speaker 1: over the call, did do a legal review of it
• 11:29
  Speaker 1: to see if if President Trump had violated campaign finance law,
• 11:34
  Speaker 1: as as he encouraged them to look into into Joe Biden.
• 11:38
  Speaker 1: The Justice Department ultimately concluded that there was not um
• 11:43
  Speaker 1: that the president didn't break the law. That they didn't
• 11:45
  Speaker 1: see anything necessarily improper, but um senior administration who official
• 11:50
  Speaker 1: told us that that that that did not include a
• 11:53
  Speaker 1: consideration of the freezing of Youkran's aid. And so I
• 11:57
  Speaker 1: think a lot of critics of the White House are
• 11:59
  Speaker 1: also going to pot not that the Justice foreman is,
• 12:01
  Speaker 1: of course um run by Attorney General Barr, who has
• 12:05
  Speaker 1: mentioned in this transcript and who is a close political
• 12:08
  Speaker 1: ally of the president. Justin what's the sense of next
• 12:12
  Speaker 1: steps here? Yeah, So I think we're looking at two
• 12:16
  Speaker 1: big kind of events on the very short term horizon.
• 12:18
  Speaker 1: One is the President is actually meeting with the Ukrainian
• 12:21
  Speaker 1: president later this afternoon, so I'm sure he's going to
• 12:25
  Speaker 1: feel questions and talk about this then, and especially at
• 12:29
  Speaker 1: a press conference schedule for four pm at the end
• 12:32
  Speaker 1: of the United Nations later this afternoon. So we're going
• 12:34
  Speaker 1: to hear a lot from the President later today as
• 12:37
  Speaker 1: he tries to explain his actions. And then, of course
• 12:39
  Speaker 1: we've got these congressional hearings going forward on the next
• 12:42
  Speaker 1: couple of days, where we're more information, particularly from the
• 12:46
  Speaker 1: mouth of the whistleblower, may might start to come out.
• 12:49
  Speaker 1: Justin if we look at the market response. Initially, there
• 12:52
  Speaker 1: was a leg lower in the SMP and NASDAC that
• 12:55
  Speaker 1: has bounced back since. So basically, people in the market
• 12:58
  Speaker 1: seem to be suggesting this is not that big of
• 13:00
  Speaker 1: a deal, or at least it doesn't move the needle
• 13:02
  Speaker 1: materially more toward impeachment. Does that cohere with what people
• 13:06
  Speaker 1: who you speak with seem to think. Yeah, I mean,
• 13:10
  Speaker 1: I think that there's obviously a lot of political attention
• 13:12
  Speaker 1: on this entire controversy, but the basic math hasn't changed
• 13:17
  Speaker 1: here in Washington, which is the Republicans continue to control, uh,
• 13:21
  Speaker 1: the United States Senate, and that there's nowhere near the
• 13:23
  Speaker 1: votes that you would need to actually remove Donald Trump
• 13:26
  Speaker 1: from office. So while Democrats might want to sort of
• 13:29
  Speaker 1: send a political message that they find this behavior to
• 13:31
  Speaker 1: be unacceptable, uh, something that would actually remove the president
• 13:35
  Speaker 1: from office and thereby potentially change policy and impact markets
• 13:41
  Speaker 1: is not something that that seems likely at this point,
• 13:44
  Speaker 1: Justine think thanks so much for joining us. Justin sink
• 13:47
  Speaker 1: as a Bloomberg News White House reporter giving us the
• 13:50
  Speaker 1: latest reporting on the call summary that was made public
• 13:53
  Speaker 1: between the of the call between President Trump and the
• 13:56
  Speaker 1: President of the Ukraine. We are broadcasting Alive from the
• 14:17
  Speaker 1: Bloomberg Global Business Forum here in New York City at
• 14:20
  Speaker 1: the Plaza Hotel, hob nobbing with the world's leaders, frankly
• 14:25
  Speaker 1: as well as the leaders of the major corporations as
• 14:28
  Speaker 1: well as the largest asset management and managers in the world.
• 14:31
  Speaker 1: Among them Dylan Play a chief executive officer of Temasek International,
• 14:36
  Speaker 1: which manages two thirty five billion dollars, and we actually
• 14:40
  Speaker 1: had an opportunity to sit down and speak with him.
• 14:42
  Speaker 1: Let's take a listen. We want to start with the
• 14:44
  Speaker 1: theme of the Global Business Forum, which is sustainability. And
• 14:47
  Speaker 1: I'm wondering how much you have shifted your investments with
• 14:50
  Speaker 1: E s G sorts of parameters to sustainability in mind.
• 14:54
  Speaker 1: So this is a journey that we've started. We started
• 14:56
  Speaker 1: about three years ago and now we're looking at it
• 14:59
  Speaker 1: in a very listic manner. There are three parts to it.
• 15:02
  Speaker 1: I would say first is, uh, we're put in place
• 15:04
  Speaker 1: at E s G framework for each of the investments
• 15:07
  Speaker 1: that we're looking at right now from the time that
• 15:09
  Speaker 1: we it first come to the pipeline to evaluation to
• 15:11
  Speaker 1: eventual execution. And it's very clear in our minds. Unless
• 15:14
  Speaker 1: it passes in the e s G framework. Where either
• 15:16
  Speaker 1: we've identified problems that can be resolved or the company
• 15:20
  Speaker 1: is largely in line with the framework, we won't proceed
• 15:22
  Speaker 1: with investment. Now we have six hundred investments intomastic, so
• 15:25
  Speaker 1: we're now extending the framework into our existing investments so
• 15:29
  Speaker 1: that we see improvement and whatever we can do with
• 15:31
  Speaker 1: respect to e s G factors. The third element has
• 15:34
  Speaker 1: to do with what we're trying to do for sustainable
• 15:38
  Speaker 1: investments that include sustainable living for example, alternative proteins, anything
• 15:42
  Speaker 1: to do with water efficiency, to look at resource efficiency.
• 15:46
  Speaker 1: The second is to consider the issue of the carbonization.
• 15:50
  Speaker 1: How we can go about reducing the cuboon footprints of
• 15:52
  Speaker 1: the companies that we control, reduce our own cuboon footprint,
• 15:55
  Speaker 1: trying to see how we can influence companies in which
• 15:57
  Speaker 1: we are minority shareholdings to think about reducing their carbon footprint.
• 16:01
  Speaker 1: Would review towards seeing how our corvered footprint for the
• 16:05
  Speaker 1: entire portfolio can be halved by twenty And the final
• 16:08
  Speaker 1: thing is to look at sustainable solutions. That includes things
• 16:12
  Speaker 1: like environmental entering. Solutions which are relevant in the context
• 16:15
  Speaker 1: of Asia, include sustainable finance because so much what Asia
• 16:18
  Speaker 1: needs infrastructure and the and there's always a tension between
• 16:23
  Speaker 1: affordability and what you need to do for climate change.
• 16:26
  Speaker 1: And so we think that the key part of this
• 16:29
  Speaker 1: is to make sure that there is a form of
• 16:31
  Speaker 1: blended finance. It's brought to to the needs of the region.
• 16:34
  Speaker 1: And we are looking now to see how we can
• 16:36
  Speaker 1: plate that. So the companies that you've invested in, how
• 16:40
  Speaker 1: typically how receptive other management teams and the boards to
• 16:43
  Speaker 1: some of the your sustainability and and e s g
• 16:46
  Speaker 1: in initiatives. Increasingly so because I think they see the
• 16:49
  Speaker 1: winds of change. Uh their customers are asking for it.
• 16:53
  Speaker 1: They have to look at their production methods to see
• 16:55
  Speaker 1: whether it's in line with what their customers will expect
• 16:58
  Speaker 1: them to do. Uh. So most of them realize that
• 17:00
  Speaker 1: they have to start their journey, some of them further
• 17:03
  Speaker 1: along the process. Some are of obviously thinking about how
• 17:05
  Speaker 1: best approach it. So I think these days we find
• 17:08
  Speaker 1: it as we talked to him about this, as much
• 17:09
  Speaker 1: as you talked to about you know, their business strategies
• 17:11
  Speaker 1: and so on, We're getting a more receptive audience with
• 17:15
  Speaker 1: these companies right now. UM, I want to shift gears
• 17:18
  Speaker 1: a little bit, because we've heard a lot about the
• 17:20
  Speaker 1: groundswell of cash just pouring into a lot of markets
• 17:24
  Speaker 1: and particularly private markets around the world in time. Second,
• 17:27
  Speaker 1: I know has been involved in that. I mean you
• 17:29
  Speaker 1: have to be as you seek out bigger returns. How
• 17:31
  Speaker 1: concerned are you about some of the evaluations that you're
• 17:34
  Speaker 1: seeing in markets today? So I think the first thing
• 17:36
  Speaker 1: we have to bear in mind we're in a low inflation,
• 17:38
  Speaker 1: lower interest rate, lower growth, lower return environment. So your
• 17:41
  Speaker 1: traditional instruments for returns, for example, fixed income and so on,
• 17:46
  Speaker 1: I'm not going to give you the same returns that
• 17:48
  Speaker 1: you're you're used to. So more and more money is
• 17:50
  Speaker 1: going to alternatives. Sopping wealth funds are shifting more of
• 17:53
  Speaker 1: all of the capital in terms of as an allocation
• 17:55
  Speaker 1: to alternatives. So there is a lot of capital looking
• 17:59
  Speaker 1: for real and two returns. Now there may be too
• 18:03
  Speaker 1: much capital out there looking at the same range of
• 18:05
  Speaker 1: investments that we're looking at um And are we going
• 18:08
  Speaker 1: to reduce our investment return framework? Monswers No. Uh, does
• 18:12
  Speaker 1: that mean there's gonna be very difficult for us to
• 18:14
  Speaker 1: source investments that we need to see to get a
• 18:16
  Speaker 1: better returned answers Yes, so valuations are a key part
• 18:19
  Speaker 1: to that, and we're more than prepared to walk away.
• 18:22
  Speaker 1: We feel it doesn't mean a return fessial for the
• 18:24
  Speaker 1: long term. So give us the sense of kind of
• 18:26
  Speaker 1: the environment out there. I know you you guys are
• 18:28
  Speaker 1: invested very aggressively around the Asia. Given the trade tensions
• 18:32
  Speaker 1: that we continue to see between the US and China.
• 18:35
  Speaker 1: What are you seeing in in your part of the world,
• 18:38
  Speaker 1: in some of the opportunities that you're looking at. So
• 18:41
  Speaker 1: the number one destination for our capital in the last
• 18:43
  Speaker 1: five years has been United States. Number two destinations China.
• 18:47
  Speaker 1: So the US China issue, it's not exactly a friendly
• 18:50
  Speaker 1: one to US um but look, we have to take
• 18:53
  Speaker 1: the wall as it is. You know, we have to
• 18:55
  Speaker 1: find our way through the difficulties that that the current
• 18:59
  Speaker 1: relationship puts forward to all of us as investors, and
• 19:03
  Speaker 1: we have to find a way in which we can
• 19:05
  Speaker 1: continue to look for good investments in the areas that
• 19:08
  Speaker 1: we are focused on, whether they be in the United
• 19:11
  Speaker 1: States or where do they be in China? All for
• 19:13
  Speaker 1: that ment, in Europe and India and elsewhere. What's the
• 19:15
  Speaker 1: one area that you've been adding your adding to your
• 19:18
  Speaker 1: allocation The most technology. So maybe I'll put it this way.
• 19:22
  Speaker 1: We have five focus areas. Technology is one life sciences, biotech,
• 19:26
  Speaker 1: the second financial services, non bankings, The third to insurance, fintech, payments,
• 19:32
  Speaker 1: asset management, consumer because it's such a big thing with
• 19:36
  Speaker 1: rising affluence is the fourth and the fifth actually which
• 19:39
  Speaker 1: is the most recent and the most exciting. First is
• 19:42
  Speaker 1: agribios Sciences. Gives an example of agri bios sciences. So
• 19:45
  Speaker 1: for example, you know we're investing in possible foods, you know,
• 19:49
  Speaker 1: so alternative proteins. I think you all know about it
• 19:52
  Speaker 1: beyond me. Well, we chose impossible foods of a beyond
• 19:55
  Speaker 1: time will tell. We'll probably that we be be two witness
• 19:57
  Speaker 1: maybe more. Um that we looking at ways in which
• 20:01
  Speaker 1: we look at vertical farming, uban farming, look at ways
• 20:04
  Speaker 1: in which that could be substitutes for hubicides pesticides where
• 20:08
  Speaker 1: less chemicals can be used. So just real quick, here,
• 20:10
  Speaker 1: is there any area completely avoiding right now? Well, I
• 20:14
  Speaker 1: don't think we're going to be investing fossil fuels as
• 20:18
  Speaker 1: you continue path to sustainability. Yeah, and ergo, that's why
• 20:21
  Speaker 1: I'm sure you're at this conference. Delon Pila, Thank you
• 20:24
  Speaker 1: so much, for joining us CEO of Timasak International, giving
• 20:27
  Speaker 1: his thoughts on his the global investment of Tamasak and
• 20:31
  Speaker 1: some of the investments and sustainability and E s G
• 20:34
  Speaker 1: and and how that factors into their investments. Indeed, thank
• 20:36
  Speaker 1: you so much, thank you for having me. That was
• 20:39
  Speaker 1: delon Play. We spoke to him earlier this morning, CEO
• 20:42
  Speaker 1: of Timasak International, some very interesting commentary here as we're
• 20:46
  Speaker 1: here at the Bloomberg Global Business Form Conference here in
• 20:48
  Speaker 1: New York. Right now, it's shift focus to We Work.
• 21:05
  Speaker 1: It lost its chief executive officer and co founder Adam Newman.
• 21:09
  Speaker 1: It's bonds, it does not have stocks because it has
• 21:11
  Speaker 1: not been able to do it's initial public offering at
• 21:14
  Speaker 1: the value that it would like to do it or
• 21:15
  Speaker 1: anywhere close. Bonds trading down significantly as we look ahead
• 21:20
  Speaker 1: to the future share of Ada. Bloomberg opinion columnist joining
• 21:23
  Speaker 1: us in our interactive broker studios, Shira, how much does
• 21:27
  Speaker 1: the departure of Adam Newman really change the landscape for
• 21:31
  Speaker 1: We Work? I mean it doesn't. Look it does change things, right,
• 21:36
  Speaker 1: because he was one element, a significant element of both
• 21:39
  Speaker 1: We Work success and ultimately it's um kind of self
• 21:45
  Speaker 1: dealing and bad management, oversight and business model. So changing
• 21:51
  Speaker 1: horses does matter. But at the same time, everybody who
• 21:55
  Speaker 1: enabled We Work to get to the point where it
• 21:58
  Speaker 1: is today is still there. That includes Newman himself. He
• 22:01
  Speaker 1: is a significant shareholder, remains a significant shareholder. He's going
• 22:05
  Speaker 1: to be on the board, right He's a non executive chairman.
• 22:08
  Speaker 1: All the investors are still there, the bankers, the lawyers,
• 22:12
  Speaker 1: all the executives. The company is now being run by
• 22:15
  Speaker 1: these two insiders. So We Work has a lot of
• 22:19
  Speaker 1: questions to answer about both its business model and the
• 22:22
  Speaker 1: structure of the company, and that's being those decisions are
• 22:26
  Speaker 1: being made by more or less the same people who
• 22:28
  Speaker 1: were there all along. So sure, one of the key
• 22:31
  Speaker 1: figures for me is Masa Yoshi san of soft Bank.
• 22:34
  Speaker 1: Um is there any sense of how committed he and
• 22:38
  Speaker 1: the fund is to this company given some of the
• 22:41
  Speaker 1: term ra what we've seen. I think that's a key question,
• 22:43
  Speaker 1: and I think we still don't really have a good
• 22:45
  Speaker 1: answer as to what made sown and soft Bank apparently
• 22:50
  Speaker 1: turned against We Work literally at the last minute, right
• 22:53
  Speaker 1: in the last few days, it seems, and I at
• 22:57
  Speaker 1: least noticed that in We Work statement yesterday about Adam
• 23:00
  Speaker 1: Newman's departure and the changes in the management team there.
• 23:03
  Speaker 1: Soft Bank was not mentioned. They were not quoted, so
• 23:06
  Speaker 1: soft Bank has not said anything, but look, this company
• 23:09
  Speaker 1: needs money urgently, and soft Bank is certainly one of
• 23:13
  Speaker 1: the more obvious candidates to provide that financing. And there
• 23:17
  Speaker 1: was some reporting today from Bloomberg and others that soft
• 23:20
  Speaker 1: Bank is looking at potentially additional UM loans and an
• 23:24
  Speaker 1: equity infusion, either from soft Bank or from real Estate.
• 23:29
  Speaker 1: And how much a shift in leadership hurt potentially we work.
• 23:34
  Speaker 1: I mean, we're talking about Adam Newman as being a
• 23:36
  Speaker 1: highly flawed leader. Certainly he was, but he also led
• 23:39
  Speaker 1: the expansion of the company and had the vision and
• 23:42
  Speaker 1: there was a certain cult of personality. Is it a
• 23:44
  Speaker 1: liability that he's leaving at all? I think right now
• 23:49
  Speaker 1: that we work as we know it is over, and
• 23:52
  Speaker 1: whatever emerges is going to be a very different kind
• 23:55
  Speaker 1: of company top to bottom. Right, I don't think they're
• 23:58
  Speaker 1: going to be able to continue in you this kind
• 24:00
  Speaker 1: of breakneck office office expansion they've had for the last
• 24:05
  Speaker 1: few years under Newman, this kind of sprawl of the
• 24:08
  Speaker 1: company into all these ancillary Uh, we related activities right
• 24:14
  Speaker 1: as a kids school, a coding academy, a m communal
• 24:20
  Speaker 1: living apartment complexes that may no longer be viable. And
• 24:24
  Speaker 1: those were things that were part of Newman's vision for
• 24:27
  Speaker 1: the company, and I don't think they're viable anymore. And
• 24:30
  Speaker 1: so that means that Newman may not be the right leader.
• 24:33
  Speaker 1: If we were going forward, is going to be less
• 24:35
  Speaker 1: ambitious and less we worky. So here I know there's
• 24:40
  Speaker 1: some financial issues here in the relatively near term. I
• 24:43
  Speaker 1: think they were going to get some big funding round
• 24:46
  Speaker 1: a debt round, a credit facility from a bunch of banks,
• 24:49
  Speaker 1: but that was continguent upon an I p O. Now
• 24:51
  Speaker 1: it looks like the IPO was shelved, at least for
• 24:52
  Speaker 1: the near term. So what's the sense of the near
• 24:55
  Speaker 1: term liquidity of this company? Yes, we Work needs money,
• 24:58
  Speaker 1: it needs it soon. It is on roughly a three
• 25:01
  Speaker 1: billion dollar annual burn rate this year cash burn rate
• 25:05
  Speaker 1: this year, and that meant it was going to need
• 25:07
  Speaker 1: money by next year. And as you said, the plan
• 25:10
  Speaker 1: was to sell several billions of dollars in stock in
• 25:12
  Speaker 1: the I p O. And there were loans, loan agreements
• 25:15
  Speaker 1: in place for six billion dollars that was tied in
• 25:18
  Speaker 1: part to the completion of the I p O. And
• 25:20
  Speaker 1: you're right that right now it doesn't look like that
• 25:22
  Speaker 1: an I p O is is going to happen, at
• 25:24
  Speaker 1: least not in the next few months. So yeah, the
• 25:27
  Speaker 1: company is going to need cash. Again, there's been reporting
• 25:30
  Speaker 1: that the company may significantly pairback expenses and cut its workforce.
• 25:35
  Speaker 1: That will certainly ease the cash burn, although that would
• 25:38
  Speaker 1: be a significant blow to the company and those employees
• 25:41
  Speaker 1: as well. And again there's been reporting of the company
• 25:44
  Speaker 1: is talking about additional loans and and equity sales to
• 25:48
  Speaker 1: kind of keep the company going. Shia. I think this
• 25:51
  Speaker 1: takes us to a broader conversation about valuations because we
• 25:55
  Speaker 1: work sort of comes after the Uber issues and as
• 25:59
  Speaker 1: a ton of money pours into tech startups pretty broadly,
• 26:03
  Speaker 1: and I'm just wondering what are we hearing from people
• 26:06
  Speaker 1: in terms of how much venture capitalists are sort of
• 26:09
  Speaker 1: gut checking themselves and what they're willing to accept in
• 26:12
  Speaker 1: terms of private valuations for some of what they're investing in.
• 26:15
  Speaker 1: You know, the venture capital industry has been in a
• 26:18
  Speaker 1: really weird place the last few years. I think almost
• 26:22
  Speaker 1: everybody who's in the business of backing technology startups will
• 26:27
  Speaker 1: say that there's too much money slashing around chasing too
• 26:33
  Speaker 1: few good companies, and that has made valuations get too
• 26:37
  Speaker 1: big and companies get funded excessively, But no one is
• 26:41
  Speaker 1: No one is willing to say that they're part of
• 26:43
  Speaker 1: the problem, right that it's always the other guy. And
• 26:46
  Speaker 1: the other guy recently has been soft Bank with this
• 26:49
  Speaker 1: hundred billion dollar Vision Fund that they've poured into companies
• 26:52
  Speaker 1: like we Work in Uber and others. So there is
• 26:55
  Speaker 1: definitely too much money slashing around chasing too few good
• 26:59
  Speaker 1: companies and um. And yet I don't know that anything
• 27:02
  Speaker 1: is going to change in the near term because of
• 27:05
  Speaker 1: what's happened at We Work, because there's always this tendency
• 27:09
  Speaker 1: to say, well, we Work is kind of a one off.
• 27:11
  Speaker 1: That was a soft Bank thing, they overinflated this company,
• 27:14
  Speaker 1: or Uber was a one off thing. Everything is a
• 27:16
  Speaker 1: one off thing. That's somebody else's fault. I certainly hope
• 27:20
  Speaker 1: that in the corners of Silicon Valley, where that your
• 27:23
  Speaker 1: capitalists live and work, that there's been some rethinking about
• 27:26
  Speaker 1: what they personally need to do to prevent companies like
• 27:30
  Speaker 1: We Work from happening again, whether that's over capitalization or
• 27:34
  Speaker 1: entrenching too much, too much power in these founders without oversight,
• 27:40
  Speaker 1: sure of a day. Thanks so much for joining us
• 27:41
  Speaker 1: talking to us about what is the latest on we work.
• 27:44
  Speaker 1: Here is a Bloomberg Opinion technology columnists for Bloomberg Opinion.
• 27:49
  Speaker 1: Thanks for listening to the Bloomberg P and L podcast.
• 27:51
  Speaker 1: You can subscribe and listen to interviews at Apple Podcasts
• 27:54
  Speaker 1: or whatever podcast platform you prefer. Paul Sweeney, I'm on
• 27:57
  Speaker 1: Twitter at pt sweeney A. Lisa brom It's I'm on
• 28:00
  Speaker 1: Twitter at Lisa Abramo. It's one before the podcast. You
• 28:03
  Speaker 1: can always catch us worldwide on Bloomberg Radio