Bloomberg Businessweek Weekend - December 19th, 2025 - Bloomberg Businessweek

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Speaker 1 (00:00):
Bloomberg Audio Studios, Podcasts, radio news.

Speaker 2 (00:08):
This is Bloomberg Business Week Daily reporting from the magazine
that helps global leaders stay ahead with insight on the people, companies,
and trends shaping today's complex economy. Plus global business, finance
and tech news as it happens. The Bloomberg Business Week
Daily Podcast with Carol Masser and Tim Stenebek on Bloomberg Radio.

Speaker 3 (00:32):
Hi, everyone, Welcome to the Bloomberg Business Wee Weekend Podcast. Well,
another busy week on Wall Street. It was the last
full week of trading in twenty twenty five. Hard to
believe with investors parsing a few more earnings, and we
got some data from the government on US jobs and
inflation and what all of this might mean for FED
policy in twenty twenty six. A lot to think about

(00:52):
as we get ready for a new year. Another thing,
who will be the next chair of the US Central
Bank in twenty twenty six? On the latter, the whole
spreading around that seemed to be in flux, kind of changing.
For the latest on all of this, though, check it
out on the Bloomberg terminal and at Bloomberg dot com.

Speaker 1 (01:08):
For a macro view of the economy, the underlying risks
and the health of the banking sector, private credit, and AI.
We caught up again with former investment banker Chris Whalen.
That conversation in just a minute plus.

Speaker 3 (01:20):
The surge for power, getting the grids ready for it,
and why these energy demands could slow down global economic growth.
We get into that with the president of National Grid
New York.

Speaker 1 (01:29):
And bitcoin, the notorious energy consumer headed for its fourth
annual decline in its history. Could bitcoin fatigue be setting
in on the industry.

Speaker 3 (01:39):
Then in our second hour, the cost of celebrating Christmas.
It's climbing it.

Speaker 1 (01:42):
It depends on what you're buying.

Speaker 3 (01:45):
Hint hint, gold rings. Yeah, kind of pricey. All right,
we're going to get into that. We're also going to
get into what it may take to get the perfect
custom ski boots by the way, Tim knows a little
bit about that. And then we get the market for
big experiences bane.

Speaker 1 (02:00):
All that to Colm. We begin with the macro and
the micro, from private credit to banking and yes, even
some AI. With someone who we turn to a lot
during the Great Financial Crisis, we're talking about Chris Whalen.

Speaker 3 (02:11):
He is chairman of Whalen Global advisors. He worked at
the New York Fed in the nineteen eighties. He has
testified before Congress and the SEC. He worked on Wall
Street at such storied firms that are no longer around.
We're talking about Bear Stearns and Prudential securities. Chris is
also co founder of the Institutional Risk Analytics newsletter It's eerie.

Speaker 4 (02:31):
The credit costs are trending down. Asset returns, thank god,
are getting back to normal about one point five percent.
But there's a lot we don't see, and that's what's
worrying people. Whether you talk about Oracle, where you talk
about private credit, what people are worried about today is
what they don't see in the data because they know
that a lot of this is being fudged. And that's

(02:53):
what worries me as well.

Speaker 1 (02:55):
What do you think is being fudged things like loan losses.

Speaker 4 (02:59):
There's a lot of four bearents here in New York
City for multi family apartments. Our new mayor is threatening
to start taking over buildings the landlords are not keeping
up to his standards. Well, the city in New York
can't afford to take care of them either, and so
we have this accumulation of pressures mostly caused by inflation,
mostly caused by our friends at the FED. But in

(03:21):
their defense, why did they do that? Because we told
everybody they didn't have to pay their loans and their
rent for two years during COVID. People forget that. In
the mortgage industry in March of twenty twenty, we were
all looking at one another going, what are we going
to do? This is after President Trump declared the emergency
and said, you don't have to pay your bills. Yeah, Well,

(03:41):
the FED came to the rescue by dropping raised to zero.
We cause a surge of home lending activity, record volumes,
and that float was borrowed to help everybody pay their bills.

Speaker 3 (03:53):
So why aren't we seeing more stress in the credit markets?
And why are we seeing records on Wall Street? And
like it sounds like then some disconnect.

Speaker 4 (04:00):
I think part of the reason that the Street has
been doing well listed stocks is because you have a
lot of liquidity coming out of private markets. Going back
into more liquid markets makes sense, right. Private equity private
credit is a mess, and we all know this. Something
like fifteen percent of private equity companies in the US
are paying in kind rather than in cash. So you notice, waiting.

Speaker 3 (04:23):
For the year to like the exits and for things
to move on.

Speaker 4 (04:26):
There's a lack of demand from banks for loans except
in one category, non depository financial companies, which is another
way of saying private equity funds, credit shops like Areas
and Apollo. They're the ones that have been aggressively expanding
their business using money in part from banks. So the
banks are now the facilitators. And what does this remind

(04:48):
us of Carol the two thousands?

Speaker 5 (04:50):
Right right?

Speaker 4 (04:51):
It's the same thing. You have non bank intermediation, relying
on the bond market, equity markets, and bank credit. And
the thing is eventually they're going to stumble, and that's
what everybody's worried about it.

Speaker 1 (05:01):
So what does that stumble look like? What is the
shoe that drops?

Speaker 4 (05:05):
It looks like First Brands, Hello, we're defaulting. And most
people had never focused on that company. It was a private,
totally institutional play. The same thing with Tricolor auto lender
that you know half of their customers were illegal aliens
that nobody had ever focused on this. It was an
institutional story that suddenly surged.

Speaker 1 (05:26):
So you think those two instances are canaries in the
coal mine.

Speaker 4 (05:30):
I think they are typical of what we're going to
see more in the future, which is you're going to
see more of the missteps in the institutional, non public market,
which was supposedly better. Remember everybody was selling us the
idea that private was better than public. No, we have
public markets because they were open and relatively liquid.

Speaker 3 (05:49):
Chris, you know after the Jamie Diamond cockroach comment that
there were many members in the private world that came
out or a few, I should say, that came on
our air, and that seemed to say, hey, listen, things
are fine, And I understand many would say they're talking
their book, but are they systemic risks, like what's the
exposure with the traditional financial sector when it comes to

(06:11):
the private markets, Because I think that's what we care
most about right now.

Speaker 4 (06:15):
I think the private players can fail tomorrow. It will
cause a bit of kurffluffle and volatility in the markets.
But are they systemic like a big bank. No, But
the big banks will take their lumps too because they
are lending indirectly into these structures. They tend to take
the most senior positions, but that may not save them.

(06:37):
You see the assumption that Okay, I'm senior and three
quarters of the stack is below me. And therefore I'm okay,
that may not work this time around because you have
leverage on leverage on leverage in some of these deals.

Speaker 3 (06:50):
When so when like the big banks report again, we're
getting ready for another earning cycle, right, you know, we'll
get that, you know, in early early January. So what
do we look for for things like that? Like, what
do you look for?

Speaker 4 (07:02):
Yours are going to be wonderful. That's what worries me,
you know, just as an analyst. We were supposed to
have a recession last year. Credit losses largely peaked last
year third fourth quarter. Yeah, they've been coming down since then.
So if you look at the picture, you say, god,
everything is great. You don't see a lot of utilization.
You don't see a lot of demand from the banks

(07:23):
for credit. They've got a ton of unused credit out
there that they wish people would use. But so you
don't see stress in the published numbers. Where you see
stresses when you talk to professionals, when you read the
really interesting media like Bloomberg and others that cover some
of these stories. There was a great piece in the
Ft talking about Altus, a company that Jamie Dimond came

(07:46):
to the rescue of paid off their most restrictive loans
so that they go out and borrow my money's right,
And all of the credit guys that you're talking about
look at Jamie Dimond and they're going, hello.

Speaker 1 (07:58):
What are you doing?

Speaker 4 (07:59):
Yeah, he he's an enabler of bad behavior because Jamie
has to go out and make money too in a
market where there isn't a lot of what I would
call quality demand, which reminds me.

Speaker 3 (08:10):
Of what would happen in the Great Financial Crisis of
people saying, I know it's getting messy and ugly, but
there was it. The CEO of City at the time,
I think who I came out and made some comment
about I got.

Speaker 1 (08:21):
To be in it, yes and no.

Speaker 4 (08:23):
I think that some institutions have the common sense to
pull back and say no, others don't. I'll give you
an example p and C. P and C has the
lowest loss rate in the top seven banks. They've always
also got one of the lowest funding costs. That's a
fairly well run half trillion dollar bank that has managed

(08:43):
to avoid risk. I think often by saying no, the
street wanted them to get more involved in certain things
like prime brokerage, dealing with private equity funds, that sort
of thing, and they said no. So I think there
are institutions that are very well run in this market.
But again, the banks are under utili because the non
bank financial companies have stolen their march and they are

(09:04):
going to the customer and they're using wholesale funding from
the big banks and they're in turn dis intermediating them.

Speaker 1 (09:11):
At the same tone, Chris, we want to talk a
little bit about AI too in the time that we
have left. We've talked about it with you before circular financing.
We're not sure how it all plays out in the
economy and what it has to do with productivity and
with economic growth. Weighing in on AI and its potential
economic impact. Ken Griffin of Citadel speaking with Bloomberg's Danny
Berger the conference in Paris. Check out what he said.

Speaker 6 (09:33):
I think there is some chance that we will see
meaningful progress in this field that will change the calculation
that i'm or calculus that I'm setting forth, Like there
are so many bright people in their twenties and thirties
trying to unlock trying to unlock true intelligence that this
does create the environment in which a breakthrough may happen.

(09:55):
But I think that generit of AI as we know
today will have a very pointed, but relatively limited impact
on the broader economy.

Speaker 1 (10:04):
Appointed but relatively limited impact on the broader economy. Ken
Griffin of Citadel, what, in your view is the impact
of AI on this economy?

Speaker 4 (10:13):
I think it's incremental better search tools.

Speaker 1 (10:15):
You know, we're writers.

Speaker 4 (10:16):
So is he right? I think he is right. And frankly,
I read a lot of the long haired stuff on
AI some of the people in the scientific community, and
they tell you the same thing. Because this is a
third or four to fifth time that we have talked
about AI. You go back to the seventies and the eighties.
Remember Watson IBM, which was a fiasco, but it was

(10:37):
their way of showing what new technology could do. But
is it creating general intelligence?

Speaker 5 (10:44):
No? All this waste?

Speaker 1 (10:45):
Is all this waste?

Speaker 4 (10:46):
No, it's marketing, you know, never.

Speaker 3 (10:48):
Yeah, but that's market but to spend, Yeah, but.

Speaker 4 (10:51):
That's Look, everything in the US economy is about marketing. Okay,
it doesn't matter what it is. And if it's attached
to a stock, then you know it's marketing. I've made
a ton of money on in video. I'm very grateful
to mister Wang, but is he going to change the world. No,
what we're doing is building a lot of infrastructure. We're
spending a ton of money, not so much on building AI,

(11:12):
but preparing to have the capacity to do it, mostly
by studying the past.

Speaker 1 (11:18):
To me, that's not AI.

Speaker 4 (11:19):
AI is when a machine can start to observe what's
around it and react and determine what to do next
based on what it sees, not because of you know,
it's studied our language for the last fifty years, so
you're understood.

Speaker 3 (11:33):
Like the whole idea of AI is all the data
that's put in from the past. Do you think that, Okay,
that's your takes.

Speaker 1 (11:39):
All we have?

Speaker 3 (11:41):
Are you still on video?

Speaker 7 (11:43):
No?

Speaker 4 (11:43):
I got out, I got out, I wrote it up.
It's split. I wrote it up again. It's split. But
it gets to be a third of my portfolio. I've
got to take the money and run, you know. With
all due respect to Jim Kramer, who I'm very grateful
to for getting me into the stock, but.

Speaker 1 (11:58):
It sounds like you're saying that that we're bubble with
at least with the spat of course, we are.

Speaker 4 (12:02):
That's what humans do, that's what markets is what happens.
We follow the shiny object. What happens when the bubble pops.
We're going to see that a lot of the spend
for AI will not be compensated with revenue growth that's
going to help to pay it off. And Oracle, I think,
unfortunately a great company, is the poster child for this.
They were following the crowd. They decided to double down

(12:25):
and do even more. And the truth of the matter
is one large language model. If all of the tech
companies have gotten together and said, look, let's do this together, right, right.

Speaker 1 (12:35):
But the other problem I.

Speaker 4 (12:35):
Think is the metaphors that we use in this conversation
is race with China. The Chinese don't use metaphors like that.
When you listen to them talk about AI. It's part
of a broader range of initiatives that they're trying to
use to give them an advantage in the global economy.
They don't see it.

Speaker 5 (12:52):
As a race.

Speaker 4 (12:53):
This is all marketing hype, and we have to differentiate
between the technology and the cell. It's like we used
to say about a IBM, never mistake sales with delivery.

Speaker 3 (13:05):
No, All right, gott to leave it there. Thank you, Billy,
appreciate it.

Speaker 4 (13:08):
Good pleasure.

Speaker 3 (13:09):
Chris Whaler and Chairman of Whale and Global Advisors, joining
us here in studio.

Speaker 2 (13:16):
You're listening to the Bloomberg Business Weekdaily Podcast. Catch us
live weekday afternoons from two to five pm Eastern. Listen
on Apple CarPlay and Android Auto with the Bloomberg Business app,
or watch us live on YouTube.

Speaker 3 (13:30):
Global electricity demand in the US is surging that we
know as massive data centers for AI begin to pop up.
EV adoption rises and government incentives are boosting domestic manufacturing.
All of that putting pressure on the power grid and
the need for energy. This surge is outpacing older energy plants,

(13:50):
straining power generation, transmission, and distribution systems.

Speaker 1 (13:54):
A report by the Albany Times Union mentioned National Grid,
New York and other utilities spending more than four billion
dollars to prep and modernize New York's electrical grid for
a generational shift that includes things like AI data centers
and more.

Speaker 3 (14:07):
The All Many Times Union goes on to say that
this spending is for investments for which New Yorkers, many
of whom are already struggling with utility costs will have
to pay for in the coming years. Now we have
the perfect voice to talk about all of this.

Speaker 1 (14:21):
Sally Librera, President of National Grid New York. It's the
subsidiary of the publicly held electricity, natural gas, and clean
energy utility National Grid. It serves millions in New York
and Massachusetts. Sally joined us in our studio.

Speaker 8 (14:34):
So at National Grid in New York, we serve more
than four million customers and we deliver natural gas and
electricity to those customers, and our focus is on doing
it safely, reliably and affordably. But the reality is there
is increasing demand for energy across the entire state, and
we serve through Upstate, we serve in Long Island, and

(14:56):
we also serve in New York City, and it's our
job to deliver that energy to meet that energy demand, where,
when and how folks need it.

Speaker 3 (15:05):
How would you quantify that demand though, Give us some idea,
because we're talking NonStop about deals of AI data centers,
whether it's New York or elsewhere. Give us an idea.
How stressed is the situation?

Speaker 8 (15:16):
So we work with our New York Independent System Operator,
the NISO, and NISO manages a what we call the
large load Q. So it's essentially the companies that have
indicated wanting to hook into the New York grid that
have large power needs. And they estimate that the cumulative
power need across those companies that are essentially in line

(15:37):
to connect sometime over the next five or so years
is about ten gigawatts of energy. And so just to
give you some context, at our peak in New York,
we demand about three times that across the entire state.
And another really important point is that one year ago
that Q was one third the size. It literally tripled

(16:00):
in just one year.

Speaker 1 (16:02):
All data centers, no, not all database What is it done?
Because it does seem like for many years we thought
that power demand across the country would actually stay relatively flat,
and it did stay relatively flat, but just in recent
years we've seen so much of an uptick in demand.
What are you seeing on your grids?

Speaker 8 (16:19):
Well, there's definitely there, definitely is the impact of data centers.
But New York is also very attractive to manufacturing and
large scale manufacturing, particularly some of the modern manufacturing we
see around semiconductors and computer components. It's very energy intensive,
and companies with big power needs are drawn to New York,

(16:39):
and we are working to make sure that they have
the power that they need, not just today but well
into the future.

Speaker 3 (16:45):
So it's interesting, right because we think about this White House,
right and encouraging investment from foreign companies to build here.
I mean, I guess you know that's the good thing, right,
We want to see other companies investing into the United States.
But there's a power grab on that right as a
result of that. In order to meet that.

Speaker 8 (17:02):
I think it is important to note that even if
we weren't at this unique moment in time with rapidly
increasing demand for power, we still have a grid in
New York and this is true across many places in
the country. We have a grid that needs investment. We
have assets that are close to one hundred years old.

Speaker 3 (17:21):
Why right, right? Tim Like? How many people like, why
if it's one hundred years old, why are you twenty
years ago?

Speaker 1 (17:27):
Right? Why did we make the investment?

Speaker 3 (17:28):
Then?

Speaker 8 (17:29):
Yeah, we have been very careful about balancing the bill
impacts which customers bear with the investments that we make
in our infrastructure. And even today, where we look at
assets that are seventy eighty one hundred years old, we're
very strategic and pinpointed about which of those assets, which
of those parts of infrastructure we replace, because we want

(17:50):
to keep customer bills low, So we look for those
opportunities where we can do multiple things with an investment,
where we can replace an aging asset with something that's
more modern and something that can carry more energy, something
that can unlock more energy that our generators have to
connect into the grid, and something that's going to be
more resilient to storms and better leverage technology so it's

(18:12):
cheaper to maintain.

Speaker 3 (18:14):
How do you balance all of that, Like affordability, as
you know, has become quite the word that we are
hearing a lot, certainly in the political environment. So how
do you keep your investors happy and the grid reliable
without rising bills that make your customers furious and invite
regulatory and political pushback. I mean, that is a hard mandate.

Speaker 8 (18:31):
It is a difficult balance, and it's one that we
navigate every single day. We do it through a number
of avenues. We certainly work closely with our customers to
help them manage costs, and we do that through a
variety of bill assistance programs and energy efficiency programs and
rebates and we work. We have consumer advocates whose job

(18:52):
it is to specifically work with folks and communities to
help them manage their costs. We also, as I mentioned before,
a very careful about where and how we invest in assets,
and we make sure that if we're investing in an asset,
that we're going to get more power from investing in
that asset, that we're going to get more resiliency, and
then we're going to get more efficiency from investing in
that asset.

Speaker 1 (19:10):
The President has been outspoken about his disdain for certain renewables,
especially wind power. Your investment in renewables, are sourcing energy
from renewables? Has that changed under this administration?

Speaker 8 (19:22):
Well, we certainly support the all of the above energy
approach and are pleased with the most recent version of
the State Energy Report that leans into an all of
the above approach. Given the rate at which demand for
energy is increasing, we need to we need to be
utilizing all of those opportunities, from renewables to natural gas

(19:45):
to nuclear to make sure.

Speaker 1 (19:46):
Is that more difficult if the federal government is not
supportive of certain renewables.

Speaker 8 (19:51):
We are working on the infrastructure to move power from
point A to point B. So while we support projects
like say the Nesty pipeline. That's a supply project. It's
not our project, but we support it because we know
how critical it is to the downstate community, and how
reliant New York City and Long Island are on natural gas,

(20:12):
and how thin that reserve margin is and their energy
demand for energy is growing as well. So we support
NeSSI for those reasons. The other side of our business
is about building transmission. It's about building the highway over
which the power moves. So the sourcing as to where
it's coming from isn't a National grid decision. We work

(20:34):
with generators of all kinds.

Speaker 1 (20:36):
That was Sally Librera, president of National Grid New York.
And just this week after our interview with Sally, we
got a new story from Noreen Malik, who covers energy
here for Bloomberg News. She writes that calls are mounting
for the largest US grid operator to make electricity more affordable.
After power cost surge to a new high. Households and
businesses will pay record sixteen point four billion dollars to

(20:59):
secure electricity starting in June of twenty twenty seven. That's
according to PJM Interconnection. It operates the thirteen state grid.

Speaker 3 (21:07):
And let's remind everybody that this power grab and AI
build out is a global thing, because there was a
story about what's going on in the Netherlands. The Dutch
national electricity grid is under enormous stress because of the
immense amounts of power from all sources of energy being
injected into the grid that their small power lines cannot handle.
Both of what Tim said this story, they really all

(21:30):
highlight a major global issue because reliable electricity supports economic
growth and vice versa.

Speaker 1 (21:35):
That's exactly what we talked about with oxshot Rothy, Bloomberg
News senior climate reporter and host of Bloomberg Greens Zero podcast.
He joined us earlier this week.

Speaker 9 (21:44):
For the last few decades in the US and in Europe,
those two regions, really electricity demand was roughly flat or
actually declining. It was mostly because of the industrialization that
is now reversing, and it's not just because of AIA,
of course is a big contributor, but electric cars, heat pumps,
just the general electrification of the industry is starting to

(22:07):
speed up and these regions have not been prepared for growth.

Speaker 1 (22:14):
I just want to jump in real quick because you
said something that that I haven't had a chance to
A lot of people said I having a chance to
ask about it. If we're using evs and we're using
electric heat pumps, doesn't that mean we're we're taking away Uh,
We're still heating our homes and driving. We're just using
different sources of energy to do that. Is one better
than the other?

Speaker 9 (22:34):
Well, yes, we are definitely using a different form of energy,
and one actually turns out to be way better. Because
your electric car consumes about one unit of energy to
move from electricity, it takes four units of gasoline to
be able to move in the same distance. Same thing
with heat pumps. Heat pumps take one unit of electricity
to actually capture some of the heat outside, even in

(22:56):
the cold weather, to heat your home. So you're getting
three x the bang on the buck that you're spending
on electricity then you would if you just burn gas
or oil in your heat pumps. So electricity is the
more efficient form of energy use, and the world wants
more and more of it, and especially in North America
and in Europe, the grids aren't ready to supply all that.

(23:20):
So the Netherlands case that you pointed out quite an
extreme case, but actually it's not the only one. Pretty
much in any G twenty economy that we looked at,
stress on the grid is growing, and Bloomberg Economics analysis
which we report in our story shows that as that happens,
economic growth slows down.

Speaker 3 (23:39):
I thought one of the lines also crucial in your reporting,
asshat is that you say crucially The analysis done by
Bloomberg Economics finds that increase in grid stress leads to
a decline in capital outlay, which is government and business
spending to acquire or maintain long term assets. So the
idea is, as the stress is building, the capital needed

(24:02):
to maybe build it out, expand the grid, improve the infrastructure,
that is declining. To me, that just says, WHOA, we
are headed for some really mega stress points.

Speaker 9 (24:13):
Indeed, and the Bluebook Economics analysis also is kind of
self limiting because when they were trying to understand the stress,
the rise and demand was one of the stress points
that they had to account for. But turns out when
you have so much stress on the grid that either
you're not able to connect businesses or price of electricity
rises as a result of you're not having enough supply.

(24:35):
There is this demand signal in the market that is
sent that we are not able to supply, and so
demand comes down. And so the analysis itself is saying,
we cannot tell you just how much worse it could be.
It can give you just a rough estimate, but basically,
if you can't get enough electricity supply, you're not going
to help economic growth.

Speaker 3 (24:55):
Yeah, it just sounds to me like governments who are
already spending in many ways as we we've seen kind
of a pushback on companies, companies countries working together. They're
building out their own defense more, they're building out their
own industry more. I mean, all of this costs a
lot from a government perspective, but it sounds like governments
are going to have to be much more involved. But
that just also potentially raises debt in countries, which for many,

(25:19):
like the United States, is already problematic.

Speaker 9 (25:21):
Yes, and there's two sides of this equation over here
on spending. One is the generation of electricity that actually
is manageable. The stuff that governments have not been spending
enough on is actually building out the infrastructure to supply
that electricity. And just if you wanted that supply, say

(25:41):
next year, you cannot really ramp up the build out
of the.

Speaker 5 (25:45):
Grid that quickly.

Speaker 9 (25:46):
You could ramp up supply pretty quickly. You could burn
more gas, you could deploy more solar panels which can
be put within months for your solar farm. But to
get your grid to be actually robust and supply more
and more electricity to more and more places, yeah, that
takes a much longer time. So the results I'm going
to be coming anytime soon.

Speaker 1 (26:05):
That was Oshcott Rothy, Bloomberg new senior climate reporter and
host of Bloomberg Greens zero podcast.

Speaker 3 (26:10):
Still ahead on Bloomberg Business Week. It's been a tough
stretch for cryptocurrency, especially in the later part of the year.
Might though the recent bitcoin fatigue be a setup for
rebound in twenty twenty six.

Speaker 1 (26:22):
The CEO of Crypto Minor Mara weighs in, that's next.
This is Bloomberg.

Speaker 2 (26:28):
This is the Bloomberg Business Week Daily podcast. Listen live
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York station, Just Say Alexa played Bloomberg eleven thirty.

Speaker 3 (26:45):
Bitcoin is headed for its fourth annual decline in its history,
and the first one that didn't coincide with a major
scandal or industry meltdown. The cryptocurrency is now down about
five to six percent for the year. This as we
were putting this show to bed down around thirty percent
though from its October sixth all time high, with volumes
low and investors bailing on bitcoin ETFs.

Speaker 1 (27:08):
The bear market means Bitcoin has decoupled from stocks, with
the S and B five hundred closing at a record
earlier this month, add up sixteen percent for the year. Well,
bitcoin has struggled to find footing. Bitcoin minor and accumulator
Mara Holdings knows all too well about the drop. Its
own stock is down more than thirty six percent so
far this year, and close to twenty eight percent of
that float is short. So the question bitcoin is it

(27:31):
set for a rebound next year?

Speaker 3 (27:33):
Those in the space certainly hope so on that. We're
joined by Fred Tiel, chairman and CEO of Mara. He
joined us from Paris.

Speaker 1 (27:40):
The decline in the asset price this year certainly, you
know one hundred and twenty six thousand dollars that was
a major high earlier this year. That was a big
moment for the cryptocurrency, but down close to thirty or
more than thirty percent from that, how much lower does
bitcoin go?

Speaker 10 (27:56):
I think your Bitcoin at this level is finding support
in the kind of eighty four thousand range, which.

Speaker 5 (28:03):
Is just about where the.

Speaker 10 (28:05):
Break even point is on most ETF purchases Bitcoin ETF purchases,
and that seems to be a level of support where
essentially people large investors who are trying to defend their positions.
If you would want to keep it above that level,
which if it falls below that, you'd see more sales

(28:25):
must probably out of the ETFs back into liquidity and bitcoin.
It's very much driven by global liquidity. You had the
expectations of more from the FED and you know, more
clarity around market structure. But I think what you really
have to look at is there was a huge run
up in the kind of August through September into October.

Speaker 5 (28:52):
Per period, and you.

Speaker 10 (28:54):
Know, a number of us felt the market was frothy
in the beginning of Q three and things were getting
little bit overheated, and you know, now we've seen some
of that come off. You've also seen a lot of
money that rotated into AI now rotating out of AI
and starting to rotate into more Dow stocks. And so
I think you're generally seeing a risk off environment. Risk

(29:16):
off tends to drive people out of bitcoin, but the
liquidity that the federal government is going to inject in
the marketplace now that quantitative tightening is over, we're starting
to see easing again. We believe that will bode well
the dollars down, which also bodes well for bitcoin. And
I think you're going to continue to see bitcoin appreciate.

(29:37):
But you've got to realize it's a very large acid class.
It's a couple of trillion dollars in size, and it
takes a lot to move the price. And I think
what we're seeing now is just some healthier tracement.

Speaker 3 (29:49):
Hey, if I may just jump in for a moment,
you know, I am wondering, Fred, you say that it's
it's a risk off environment, and yeah, I'm looking at
an S and P five hundred that's still near its
all time high, you know, and we've seen quite a
bounce back when it comes to the S and P
five hundred also a very big market. So I'm just curious,

(30:12):
you know, how do you square that if we're seeing
investors still willing to move into the equity markets but
not crypto. That disconnect, Well.

Speaker 10 (30:23):
I think you have to in regards to crypto, you
have to look at the derivatives market, which is much
bigger than the actual spotpitcoin market, and you have to
see the sheer amount of leverage and positions that have
come off since the peak. You know, you've gone from
the ninety billion dollars range down to the thirty billion

(30:45):
dollars range of open positions, and so that's a huge
amount of leverage that comes off, which essentially sucks wind
out of the marketplace, and people have been moving their
money out of bitcoin and into other things.

Speaker 5 (30:59):
I think you've all look at the AI stocks.

Speaker 10 (31:01):
Most of the second tiery AI stalks have all seen
a pretty large come down since the peak, even stocks
such as Oracle, look at Core, We've you know, look
at these stocks and how they've performed, and I think
what you're seeing is a rotation out of some of
those and into other stocks. And big coin is associated
with technology, it's associated with the risk on assets, and

(31:24):
it's very associated with liquidity.

Speaker 3 (31:27):
So having said that, and you talked about the run
up that we saw earlier in terms of crypto that
where it got to maybe like frothy levels. We're now
at what eighty seven thousand and eighty seven thousand, three
hundred and two and change. So what do you think
should be the level of crypto that makes more sense?

Speaker 10 (31:48):
I think you have to look at the long term trend.
But more importantly, go back a little over a year
ago and go fourteen fifteen months ago, no US money
center bank would deal with crypto related companies, nor would
they take crypto deposits, nor would they let you trade crypto,
or would they let you wire money to crypto exchanges.

(32:11):
Almost and today you have every bank, including JP Morgan,
now moving ahead and doing all sorts of things with crypto.
You're seeing tokenization of assets. DTCC has now gotten a
no action letter from the SEC around tokenizing assets. You're
seeing all sorts of activities around the traditional finance environment

(32:32):
where they're embracing crypto. And I believe that what part
of the effect of that is you're now going to
see all sorts of things wrapped around crypto, which will
make the space much more relevant.

Speaker 5 (32:45):
But it takes time for those products to take effect,
get launched.

Speaker 10 (32:49):
And I think again, bitcoin has had a great run
over the past fifteen years. It's been one of the
best performing assets on record, and I think that and
continue to see great performance out of bitcoin over the
coming years.

Speaker 1 (33:03):
So, Fred, you're a bitcoin minor, you're also a bitcoin accumulator.
We've spoken to Eric Trump of American Bitcoin and I'm
curious he's also a minor, also an accumulator. What makes
your company different than American Bitcoin.

Speaker 10 (33:18):
Well, any company that minds bitcoin is performing the exact
same service for the bitcoin network, which is essentially assembling
transactions into blocks, competing to win the right to essentially
add that block to the blockchain. What differentiates Mara from
American Bitcoin A. We own all our rather we own

(33:39):
about seventy percent of our hosting operations. We're fully vertically integrated.
We own power generation, We generate energy off of wind farms,
off of flair gas and oil fields. We operate on
four continents. We also are fully vertically integrated from a
technology perspective. We operate our own pool. We co founded
the only u u AC manufacturer for bitcoin mining A six.

(34:05):
The rest of the market is all dominated by Chinese companies,
and we have been very proactive in helping drive a
lot of the growth of crypto around partnerships with energy companies,
and I think you know, we're still considerably larger than
American Bitcoin, not just in our mining operations, but also

(34:25):
in the amount of bitcoin that we hold in our
balance sheet.

Speaker 1 (34:29):
On the identity part of this, trying to understand what
the company looks like. You guys issued a statement this
week saying you're not a digital asset treasury firm. You
should not, so you should not be excluded from MSCI,
Whereas the company said it has been adopting a bitcoin
treasury strategy by holding its mind coins. What is the
difference between being a treasury company versus a company that

(34:50):
adopts the treasury strategy. Help us with the nuance there.

Speaker 10 (34:53):
Sure, so, a bigcoin treasury company, for example, like Strategy
or micro Strategy as it's formerly known as, has acquired
all of its bitcoin by purchasing it. Mara has mined
the majority of its bitcoin. We've also purchased bitcoin in
the market, but most of our bitcoin is the product
of our mining operations. We have chosen to hold our

(35:16):
liquid assets in bitcoin because we believe again better to
hold our cash in the best performing asset class over
the past fifteen years than to hold it in fiat,
which is continued in losing its value, or just to
hold it in treasuries, which will only pay a dividend
of the low single digit percentage points. So bitcoin has

(35:37):
been an excellent place for us to hold our cash
and we'll continue to be so, we believe over the
long run. But we generate bitcoin by mining bitcoin. We're
not out in the market buying bitcoin on a regular
basis like micro strategy. We have from time to time
gone into the market and bought it when we think
it's very opportune. Last year, there was an opportunity to

(35:58):
buy bitcoin when it was in the sixty ish thousand
dollars range, and we bought bitcoin because we had a
feeling it was a belief allow that it was going
to go up, which it did, and there are times
where we're all opportunistic like that. But we sell bitcoin
that we produce to fund our operating expenses, so you know,
we are not a company that holds our bitcoin. Every

(36:20):
single bitcoin that we have we actually sell bigcoin from
production to fund our business.

Speaker 5 (36:24):
So we're an operating business.

Speaker 10 (36:26):
Bitcoin mining is our primary business, and bitcoin just happens
to be how we hold our funds.

Speaker 3 (36:31):
Fred One thing. I'm just curious though, going back to
what we've seen in terms of the fatigue in the
price and bitcoin coming down. You know, what's interesting is,
and I'm just looking at some of our reporting and commentary.
You know, you've got a White House that's very much
favored or favoring the digital currency world. You have the
President declaring crypto a national priority. US Congress has passed

(36:55):
a landmark stable coin legislation, and bitcoin exchange traded funds
we're raking in billions of dollars. You know, We've seen acquisitions,
We've seen so much movement, and again I'm going back
to the decline that we've seen in crypto. You it's
a pretty favorable environment. So, I mean, is all of
the good expectations in terms of news already priced in

(37:18):
and it can't get much better.

Speaker 5 (37:21):
Now.

Speaker 10 (37:21):
I think, like anything, any asset will revert to mean,
and bitcoin is simply reverted to mean. It has most
probably overcorrected. But you had in the past six months
a huge amount of accumulation by the plethora of digital
asset treasury companies that were formed, you know, and the

(37:43):
you go back not too long ago. It was basically
micro strategy was the only real one you had met
a planet. To a lesser extent, similar scientific was a
smaller one, and we were a large holder of bitcoin.
That was kind of it. And then all of a
sudden you had all sorts of companies come out of
the would work what they do? They raised cash, they
went and bought a bunch of bitcoin, which drives the

(38:03):
price up. Right, price comes up, people start putting money
into ETFs. You start getting bigger derivative positions. Okay, it's
a flywheel effect. And if you just draw a trend
line over the past number of years, you'll see bitcoin.

Speaker 5 (38:15):
It's just proverted to name.

Speaker 3 (38:16):
Gotta run, Fred, Thank you so much, Fred Tiel, chairman
and CEO of Mara.

Speaker 2 (38:23):
You're listening to the Bloomberg Business Weekdaily Podcast. Catch us
live weekday afternoons from two to five pm Eastern Listen
or watch us live on YouTube.

Speaker 3 (38:37):
Plenty ahead in our second hour of the weekend edition
of Bloomberg Business Week, including two CEOs, two very different worlds,
and both reshaping how we experience life and leisure.

Speaker 1 (38:46):
The CEO of the privately held ski book company Surefoot,
on why the right fit can change everything on the
ski slopes and beyond.

Speaker 3 (38:53):
Then, from carving turns to commanding crowds. The CEO of
Feld Entertainment, the company behind some of the biggest live spectacles.
I'm keeping audiences coming back generation after generation.

Speaker 1 (39:03):
First up this hour. The cost of celebrating Christmas. It's
climbing yet again, at least according to data from the
PNC Christmas Price Index CPI. See what they do there now?
With its forty second year, PNZ has been keeping track
of just how much the Twelve Days of Christmas costs,
and spoiler alert, it's gone up again this year.

Speaker 3 (39:23):
The report highlights labor market pressures, not tariffs, to blame
for some of the rising cost We mean you, Lord
de leeping and oh one of the twelve days outshone
all others in a price hike, breaking it all down
for us. Amanda Gotti, chief investment officer at P and
C Asset Management Group.

Speaker 11 (39:39):
It's almost always more expensive. Thanks guys so much for
having me. On a year over year basis, the Christmas
Price Index is up four point five percent, so we
are handily outpacing Wow, the bls CPI version. So it's
gonna cost true love this holiday season?

Speaker 3 (39:57):
All right? So wait, what's costing us more? Well?

Speaker 11 (40:00):
Sadly, I mean we talk about this every year, but sadly,
my all time favorite gift is actually the biggest mover
by far. So five golden rings? Do I have to
elaborate on that?

Speaker 3 (40:12):
Gold was an outperforming acid?

Speaker 1 (40:15):
Nobody asked for five crypto rings Bitcoin?

Speaker 11 (40:18):
No, no, they didn't, although they would have done okay
for at least part of the year. But the five
Golden rings weren't up as much as the price of
gold itself, still up a very hot thirty two and
a half percent. It's really very much a reflection of
what we think is a little bit of a margin
squeeze right late endings of the cycle. Still positive growth

(40:38):
story for the economy, but margin pressures are building, and
so we are seeing that in the price of the
golden rings being passed through or maybe not being quite
fully passed through this holiday season.

Speaker 1 (40:50):
Okay, so those are the golden rings. What else was
what's the second most expense not most expensive, but the
thing that went up the second.

Speaker 11 (40:56):
Most you pear tree, Really, who which which nobody wants
a partridge. Okay, so the partridge was flat on a
year over.

Speaker 1 (41:06):
Your basis a gift that keeps on giving.

Speaker 11 (41:10):
It's an awful lot of work. But the pear tree
is what we refer to as a proxy for housing costs.
And so when we think about housing UH and the
housing market in this country clearly running pretty hot on
a relative basis year over year, affordability getting kind of challenged. Right,

(41:30):
Even though mortgage rates have come down some, it hasn't
made a huge difference in terms of UH supply and
demand and inventory levels. We're still very short housing stock.
So pear tree, also running hot on a year over
year basis.

Speaker 3 (41:44):
Also performers, right, I mean the cost of labor. I
guess you could kind of.

Speaker 11 (41:48):
Say, well, it's sometimes it is the cost of labor.
Sometimes it's contractual escalators. This year, the big one is
the ten Lords of Leaping. And I've been having fun
all year talking about this one because Oasis has been
the hottest concert ticket in town. You could refer them
as the Lords of Rock perhaps, but so this is

(42:09):
the real world concert tickets experiences demand driving up those
ten Lords.

Speaker 1 (42:15):
Yeah, how do you measure that? Just on a on
a basis, like are you just looking at at Oasis?
Are you looking at everybody?

Speaker 11 (42:20):
No, I'm teasing. I just it's fun to try.

Speaker 1 (42:23):
I mean, you went to an Oasis concert. At two
Oasis concerts, I know one of them. Where did you go?
Tell you our producers? Yes, Scotland in LA. She traveled
all the way for Oasis from New York. Like, so
there's some serious fans amazing.

Speaker 11 (42:39):
Yeah, absolutely, as am I. But I don't have ten
lords laying around here. So we do our best to
try and talk to dance companies and theater companies on
a year over year basis. There's a method to this
scientific madness, and so so I'm just trying to make
it a little bit relatable. The lords of all the
performers or the biggest standout on a year of your basis,

(43:02):
So naturally it must be the Oasis effect.

Speaker 3 (43:04):
If only I had ten lords deleeping, just hanging around somewhere,
just kidding, just kidding. Hey, what stayed the same? Or
did anything go down?

Speaker 11 (43:12):
Oh? Almost nothing goes down. Let's get real here. I
would love to say, aside from the pandemic, when we
had to shut the lights off, on a lot of
the performers and experiences, just as a function of what
was happening in the real world economy. A number of
gifts did stay flat on a year over your basis,
so two turtle doves, three French hens, four calling birds,

(43:36):
the seven Swans, the eight maids, So there was a
decent amount of stability on a year over year basis,
but some pretty significant moves in the top three or
four on a year of your basis.

Speaker 1 (43:47):
This is fun, and we do this because it's fun,
but it's also does give us an opportunity to talk
about the real world inflation that we're seeing and also
real world asset price movements, Amanda. Overall, the index it
moved more than headline figures. When it comes to CPI,
it sure didn't.

Speaker 11 (44:06):
That's not always the case. But you have to think
about the gifts in the Christmas Price Index as a
very specialty gift basket of goods and services, so it's
not really a reflection of the broad economy and the
US consumer in total. It tends to lean higher end
in terms of the spectrum there, but I think it
is a good indicator for what some of the pricing

(44:30):
trends may look like this holiday season, so the consumer
is definitely hanging in there. On a relative basis, we
definitely see consumers continuing to spend, and retail sales data
continues to look solid. Holiday shopping looks good, but it's
definitely going to cost consumers this holiday season.

Speaker 3 (44:48):
Yeah, what's the next I'm curious about what data points
you're kind of keeping an eye on to get an
idea of what happens maybe in the first half of
twenty twenty six, or is it too soon to kind
of make a bet on any thing we see over
the next couple of weeks.

Speaker 11 (45:02):
Well, I don't know if it's too soon necessarily to
bet on it. I think the challenge is that some
of the data is stale, so it's hard to extrapolate
a trend from data points that are old or maybe incomplete.
So as it relates to consumer health, and we're obviously
focused on how the holiday shopping season plays out, retail

(45:22):
sales data, savings rates, even just consumer sentiment. There's a
number of other, you know, components and indicators that we
can use to gauge the success of this this holiday
season and perhaps even the markets path forward in the
new year.

Speaker 1 (45:37):
So good shape. We're in good shape.

Speaker 11 (45:40):
I think we're in good shape.

Speaker 3 (45:41):
Okay, yes, unless we're going to put golden rings or
you're getting ten lords of leaping or pipers, might not be.

Speaker 11 (45:50):
Might not be in good shape. But the rest of
us are in good shape.

Speaker 1 (45:53):
You're in good shape. Unless you're looking for Oasis tickets
because apparently they're not touring anymore. So that's it. It's
your chance.

Speaker 3 (46:01):
Amanda, thank you so much. Have a great holiday season,
Happy New Year. Amanda Gotti, Chief Investment Officer, P and
C Asset Management, joining us from Philadelphia. I love these
kind of we're just fun.

Speaker 1 (46:11):
We have fun with this one.

Speaker 3 (46:12):
But it's you know, those gold rings.

Speaker 1 (46:13):
Sometimes the price of gold does not go up, so.

Speaker 3 (46:17):
No, right, and there was a long period where it
did not. So yeah. But if you go at shopping
and you're looking for jewelry.

Speaker 1 (46:23):
Gold rings, that's what you think. Uh, diamonds are a better.

Speaker 3 (46:25):
Dealer, might be a little expensive.

Speaker 2 (46:27):
You're listening to the Bloomberg Business Weekdaily Podcast. Catch US
live weekday afternoons from two to five pm Eastern. Listen
or watch US Live on YouTube.

Speaker 3 (46:41):
We got another read on the economy this past week
after Darden Restaurants, the owner of the Olive Garden and
Longhorn Steakhouse, raised its comparable sales forecast, citing better than
expected growth fueled by more affordable meal options and strong
spending from higher income diners. The company also talked about
beef prices the CFO, saying they are expected to fall
next year as production increases.

Speaker 1 (47:03):
Some good news there, but overall, we've seen really mixed
results from the restaurant sector this year. Sweet Green CEO
stepping down this week after shares dropped about eighty percent
so far this year, Cava is down sixty percent from
this year's high, Chipotles down about forty five percent from
last year's highs All.

Speaker 3 (47:19):
Right, so lots of questions out there when it comes
to the restaurant industry. We wanted to know what's going
on and how it and the US consumer may fare
in twenty twenty six. On that, we caught up with
Michelle Corsmo, president and CEO of the National Restaurant Association,
that's the trade group for the industry.

Speaker 7 (47:36):
So we've seen one point five trillion dollars in restaurant
industry sales in twenty twenty five, which is up from
last year, but not as strong as it needs to
be and not as strong as we want it to
be in these really tight margin businesses. And what we
found is it kind of depends on how you're leaning
into that price certainty. For customers, value matters. Price certainty

(47:56):
really matters, and so you see that making a difference
as they're also navigating and all of the tariff and
supply chain and beef price problems that you've just talked about.

Speaker 1 (48:04):
Yeah, we're going to get to some of the challenges
in just a minute. So that's how your members are doing.
Your members depend on consumers. From your perch, how's the
consumer doing? And it's not monolithic by any means, but
how would you describe the US consumer right now?

Speaker 7 (48:20):
So the US consumer right now, I would say is
very deliberate. They want to be certain about what they
are spending and how they're doing it. And that's really
a place where restaurants have been able to lean into
some of that certainty in the offerings they have in
the pricing. But it's definitely been a situation where we're
not seeing as much traffic as.

Speaker 3 (48:41):
We normally would.

Speaker 7 (48:42):
We always want to see those guest count numbers going
up in restaurants, and it hasn't been going up at
the level that people want.

Speaker 1 (48:50):
Okay, So I just want to go through some of
the challenges you mentioned. Some of the challenges you said,
the tariff related challenges, the beef price challenges. What is
the biggest challenge that restaurants are facing Certainty.

Speaker 7 (49:05):
I think with every industry and with every business, what
everyone is looking for is certainty. And we certainly know
that the President has an aggressive agenda to try to
make a strong economy for US consumers. But the lack
of certainty actually creates something that feels quite the opposite.
When restaurants are dealing with how to navigate different pricing,

(49:28):
supply chain problems, tear iff price increases, changing from day
to day. That definitely gets to be a bit of
a challenge for restaurants trying to serve consumers that are
looking for that certainty.

Speaker 1 (49:40):
You know, one thing that we're seeing certain about is immigration.
And this note from Torsten Slock at Apollo really caught
my attention. He writes from twenty twenty two to twenty
twenty four, net immigration was around three million people per year.
The CBO forecasting that annual immigration in twenty twenty five
and twenty twenty six will be around five hundred thousand people.
Torsten writing quote, this has important consequences for labor supply,

(50:04):
wage growth, and housing demand. From a labor supply issue
that affects your members, but also from a customer's perspective
that affects your members. Which one is harder for the
restaurants in the US right now? Is it the lack
of workers from immigration? Yeah, that customers from immigration.

Speaker 7 (50:23):
That feels like a Hobson's choice. So, without a doubt,
the restaurant industry really cares about ensuring that we've got
enough workforce to help provide that great hospitality that makes
people love restaurants. And there's nine hundred and eighty eight
thousand open positions in restaurant and hospitality this month. So
we need workers. And this is why it's been a

(50:45):
significant issue for US to push for immigration reform. We
need more legal pathways for guest worker programs, more opportunities
for people to come in and do this work even
as a guest worker, in a legal, documented fashion. And
so getting to that solution is something we're really pushing
for for Congress because we need to get people in

(51:06):
jobs in restaurants. The consumers need it.

Speaker 1 (51:09):
Well.

Speaker 3 (51:10):
Big problem that's a lot of workers that aren't that
the industry needs. Is the White House listening? Are members
of Congress listening?

Speaker 7 (51:18):
We never feel like they're listening enough on immigration, so
they're always seems.

Speaker 3 (51:23):
Are they listening less than maybe they were in years past,
recent years past, this has been.

Speaker 7 (51:29):
A difficult issue. In fact, some would call this the
third rail in terms of issues that Congress deals with
for decades frankly, and we get close often, but we
need to get it across the finish line. And so
that's really what we're pushing is it's time for them
to realize that it has to provide some legal pathways

(51:50):
because we're seeing I mean, those numbers that you're talking
about with immigration coming down, I think we're going to
see in twenty twenty five in reports I've read that
this will be the first year that the US population
will not have increased and that's a significant impact on
our workforce, and so we care a lot about making
sure that we've got enough workers in the restaurant industry.
You know, there's certainly a lot of places for technology

(52:12):
to take jobs, but hospitality is still built on people
and personal interactions. So we want those people to work
in restaurants, and we want obviously a robust economy with
lots of consumers that are coming in to enjoy those restaurants.

Speaker 3 (52:26):
Well, you know, and I just want to go back
to the speech that President Trump gave last night, the
primetime speech, and he talked a lot about immigrants and immigration,
but he said a lot of the immigrants and forgive me,
and I should have the exact quote in front of me,
but basically that a lot of the immigrants that are
coming in are criminals and so on, what's the restaurant

(52:47):
industry's experience with immigrants who come into the United States?
And I realized, there's legal, there's illegal. So I'm just
but there's a lot of folks that maybe aren't legal
that are in the restaurant industry that you might hear
that kind of on the side. So I'm just curious
about that commentary from the President and the reality of
what it really is all about.

Speaker 7 (53:06):
We don't think that that commentary tells the full story.
And I think we want to start with a complete
agreement that people that are breaking laws, especially those laws
that are hurting Americans, really aren't as illegal immigrants certainly
not a place for them here, and so creating a

(53:26):
safe environment for Americans is really important. But there's a
lot of people who are showing up every day, working hard,
being reliable, taking care of their families, doing the right thing,
mowing their law, all of those things that make your
neighbor somebody that is friendly and reliable that you want
to see. And so this is why it's important to
us that we push for more legal pathways to guest

(53:49):
worker programs because those people need to be in our
communities contributing. And obviously we need to deal with the
people that are breaking the laws, but for those people
that want to work hard and show up and contribute
to our economy, let's find a place for them.

Speaker 3 (54:04):
To do that.

Speaker 1 (54:05):
Beef price is still up thirteen percent so far this year,
though they're down from the highs that we saw in
August and September of this year. We've spoken to you
in the past and we've talked about inflationary concerns, but
it hits restaurants different because the margins are so tight
what are the biggest costs right now for your members.

Speaker 7 (54:26):
So beef costs for sure. We're seeing a lot of
fluctuation on seafood. One of the things that we're seeing
in the data that we're trying to figure out is
a lot of data is showing seafood as a protein
price going down. But what our members are telling us
from our survey work is that they're seeing increase seafood prices,
and so there's a lot more we've got to figure

(54:47):
out there. And I think this is a place where
tariffs or the threat of tariffs is really hurting that
supply chain, especially as whatever happened to be in the
warehouse under a pre tariff price really starts to deplete.
And so I think anytime you're looking at proteins, that's
going to be a place where people are concerned. And
then anytime you're looking at any kind of vegetable or produce,

(55:12):
we want to make sure that those tariffs stay off
as well, because we can't produce in the United States
the amount of produce that can we consume on a
regular basis, and we certainly can't produce it year round.

Speaker 1 (55:25):
Michelle not in DC in the will that is true,
and even in California, doesn't satisfy the entire country or
provide for the entire country. Hey, before we let you go,
we got to talk about cold hard cash, specifically the penny.
Was surprised on our editorial call when our producer already
said that this is a big issue for you guys,
costing your restaurants thirteen to fourteen million dollars monthly enforced

(55:48):
rounding losses will explain what's going on with the penny.

Speaker 7 (55:52):
Well, it is certainly interesting, and nobody really had on
our Bingo card for twenty twenty five that we would
be talking about penny shortages. But for some reason that
we can't quite figure out, the Fed has stopped circulating pennies.
So the Federal Reserve does a really important thing by
keeping money and coins circulating around the country so that

(56:12):
we've got the right level of those coins and bills
in the right areas and regions, and right now they're
not doing that with pennies, and so we're seeing pennage shortages,
and so often consumers are coming in and paying cash.
In fact, I think people would be surprised to know
that one in four transactions and restaurants is a cash transaction,
so people are coming in paying cash and often they

(56:33):
can't get exact change. So that's creating a difficult situation
for consumers. But also that difficult situation that you cited
in the thirteen to fourteen million dollars a year in
lost revenue for restaurants.

Speaker 3 (56:46):
Wow, that's a real number. It's interesting. My understanding is
they stop mining them because I think it costs more.

Speaker 1 (56:52):
But this is different. This is the Federal Reserve in
circulation versus the US not producing them new ones, so.

Speaker 3 (56:57):
They're pulling amount of circulation.

Speaker 7 (56:59):
Yeah, there are three hundred million pennies that are in
circulation right now in the US, and so there should
be enough pennies rolling around that we can keep using
pennies even though they are not mint.

Speaker 1 (57:13):
They checked the couch cushions, that's right, my husband's or
the washing machine that's usually where they end.

Speaker 4 (57:22):
Are true.

Speaker 3 (57:23):
Bring up those pennies, it matter, and those single socks. Michelle,
Thanks so much. Michelle Cosmo, President and CEO of the
National Restaurant Association trade group for the restaurant industries.

Speaker 2 (57:34):
This is the Bloomberg Business Week Daily Podcast. Listen live
each weekday starting at two pm Eastern on Apple car
Play and Android Auto with the Bloomberg Business app. You
can also listen live on Amazon Alexa from our flagship
New York station, Just Say Alexa played Bloomberg eleven.

Speaker 1 (57:51):
Thirty well from Utah to California. Ski resorts across the
West to laid their opening days. This due to a
lack of natural snow as well as temps were too
warm to make snow. So we're talking about Jackson Hole
and Wyoming Park City and Deer Valley in Utah, Schweitzer
Mountain Resort in Idaho, Heavenly and North Star in California.
They all opened later than originally planned.

Speaker 3 (58:12):
I'm going to let you keep going because you've been
so excited about this.

Speaker 1 (58:15):
This has serious economic implications in the towns and states
where these resorts operate. According to the Bureau of Economic Research,
it came out last year and it said that snow
activities in the economy for the US was a seven
point seven billion dollar business in twenty twenty three, and
that in Colorado, Utah, and California it was the quote
largest conventional activity.

Speaker 3 (58:36):
It's a big deal.

Speaker 1 (58:37):
It's a very big deal. Yeah, for more on the
ski industry and how this season is looking. We welcome
Bob sha He's founder and CEO of Shurefoot. Surefoot is
the biggest custom ski boot company in the world. They've
got twenty nine locations in North America, Canada and Europe.
Bob joins us here in the Bloomberg Interactive Brokers studio. Welcome.
How are you?

Speaker 12 (58:53):
Thank you good?

Speaker 5 (58:54):
I'm really good.

Speaker 1 (58:55):
So for people who aren't familiar having step foot into
a Surefoot, explained the process because I think people understand
ski boots, but then sure if it takes the shell
and then and then customizes it, what do you guys do?

Speaker 12 (59:05):
I mean, basically, a person comes in the door and
then there's some conversation with them to find out their
history of skiing and how much they've skied, what level
they're at and everything, and then they're kind of evaluating.
But then the technical part starts. We put your foot
onto a three D imaging machine which makes an orthotic
for underneath your foot the first step in there, and
then we put you onto another image that takes a

(59:29):
scan of your foot. So it really what we do
with that scan is we match that to the shell.
So we basically have a visual of your foot exactly
and we match it into we find the right shell
for you, so now that shell matches your ability, your
history and skiing, what you enjoy about the sport, and
then we put it together with a custom liner that

(59:50):
we make, and we have numerous different ones, about five
or six one so we you know, looking at your
foot the side from there, which one's going to work
best for you in the sport. And that whole process,
because we've sort of packaged it all together on the
same roof, just takes about an hour where we can
go from you walking in the door to walking out
with a boot that's totally custom fit for your foot,

(01:00:12):
ready to ski in.

Speaker 1 (01:00:13):
You've done this, Yeah, I did this back in twenty
twenty one. I finally got my first pair of Surefoot boots.
I mean I've lived in places where Surefoot has had
locations and finally I was like, you know what, I'm
getting to my late thirties. I don't get ski boots
very much. It's time for me to have like a
really comfortable pair of boots. And I've wanted a pair
of surefoots.

Speaker 3 (01:00:32):
And they haven't always been comfortable.

Speaker 1 (01:00:33):
No, they haven't. And you know the thing is is
and you know, I had a scan done in like
two thousand, let's say two thousand and seven maybe for
a pair of orthotics for cycling shoes, and they were
able to tell when I went to the store that
my foot had actually changed. Yeah, since that so they
had to make a a They did re scan it
and do a new pair of orthotics based on the
new scan, because I guess that's what happens when you age.

Speaker 12 (01:00:54):
Yeah, well, I think it's it's most feet do that,
you know, if you have some flexibility mobility in your.

Speaker 3 (01:00:59):
Foot, were too, right, Yeah, but go ahead, Yeah.

Speaker 12 (01:01:02):
Yeah, over time, it really you know your foot's going
to change a bit. And the scans are extremely precise,
so it's you know, we can be talking about minute difference,
but that minute difference.

Speaker 5 (01:01:12):
Is a big deal.

Speaker 12 (01:01:13):
It's a big deal in biking shoes if you're really
into it, and it's a big deal in ski boots.

Speaker 3 (01:01:18):
Bob, how did you get to this point? Because to
me it makes a lot of sense and obvious with you,
I wear orthotics and just general and it just makes
such a difference in shoes and sneakers and what have
you how did you get to this point?

Speaker 1 (01:01:28):
You know, really it started.

Speaker 12 (01:01:30):
I grew up skiing and ski racing, and boots always
just killed my feet, Like really, I have very wide
fore foot and boots. You know, when you're trying to
jam into a ski racing boot, it's just there's a
lot of pain. And I really it took time off
the slope. I couldn't stay out as long as I
wanted to as a kid, and so over time it
just started developing ways to make it a little better.

(01:01:52):
And then as I got done with ski racing in college,
is like, I don't want to leave this sport. I
love the sport. I can make a differentference in it.
So that was really the impetus for it, you know,
thinking about it. And then then a lot of trial
and error. I'm in crazy trial and error.

Speaker 3 (01:02:08):
What was the tell us? What was some of the error?

Speaker 1 (01:02:11):
I don't remember.

Speaker 12 (01:02:12):
One of my first employees is that John Higgins was
you know, he was on the US ski team and
collegiate ski racer, and we were together were trying to
make a pair of boots for me with a new
this foam material that we had found, so we injected
into my foot and he gets it all over his hands, everything,
and then I'm standing there and it feels like it's

(01:02:34):
going to break the bones in my foot. I'm like, John,
you got to get this off. You got to get
this off my foot. It's breaking the bones. And a
guy was walking by kind of through the back corner
of the space that we were in, and he was
a chemic Glen's yearne. He looks at John and goes,
if you don't get that off your hands in the
next like thirty seconds, it's never coming off. So now

(01:02:54):
John takes off to get that off his hands, and
I've got this on.

Speaker 1 (01:02:58):
My foot about me.

Speaker 12 (01:03:01):
I think it's breaking the bones in my foot, and
I'm like, but luckily it didn't, and he got it
off his hand, and we probably took a step back
for a couple of years from that. But that's really
how it began.

Speaker 1 (01:03:12):
So we're going to talk more about the origin story
in a few minutes, and before we get there, one
of the reasons we wanted to talk to you is
because you serve this higher end consumer and we talk
a lot about what the economy looks like right now,
and just when you talk about skiing in general, you're
already talking about a segment of the consumer that can
afford to travel to a ski area, pay for an
you know, expensive lift ticket, oftentimes stay in an expensive

(01:03:33):
area and then do something that requires expensive equipment. Give
us an idea. And you're a private company, so it's
you know, we don't have access to a ton of
your own data. But how is the consumer you're dealing
with right now? How are sales? What are some numbers
you can give us.

Speaker 12 (01:03:48):
I mean, I think all of us are always a
little you know, you're just kind of have this tendency
when you're in business. You know, you're a little worried.
But right now things are actually going along pretty well.
You know, we've this is we're up a little. But
then as you were talking around about just before how
we didn't have snow, we take a dip, you know
with that when it's early. But in general terms, we

(01:04:11):
see the consumer is fairly strong, you know, coming in
and you know, you know what's really happened to him.
I think that people recreation is just a bigger part
of our lives. We all have, you know, we want
to do that, we want to be out there, and
luckily we're in the sport that people really love.

Speaker 3 (01:04:29):
Bob, have you seen that coming off the pandemic of
people even like kind of that. Obviously after the pandemic,
it was like I got to get out in the
world because I couldn't for so long. But do you
see it kind of lasting.

Speaker 12 (01:04:40):
Yeah, I mean, honestly, I see it my own company.
How many people aren't in there. I think it became
more important for everybody. You know, it's like you're out
of the office a bit, you got outside and it
just it seems healthy and that's good to me. It
seems like half in to the mountains. We look at
it like it's a healthy place to be to exec
size and stuff, and so I think it's good for

(01:05:02):
the it's good for my business, good for the sport,
my life.

Speaker 1 (01:05:05):
Well, people in New York City know that you have
a store in New York City. But it's kind of
a unique store because it's it's not near a ski mountain.
Every I think, every other store that you have maybe
save for Vancouver or or London. Yeah, you know is
right at the base of a scheme mountain is New York.
You're you're like the biggest location in terms of what
it does in sales.

Speaker 12 (01:05:24):
It was the first it was the first city store.
It's not our biggest volume store, you know, we have
that amountains, but many of our stores are very similar
in size. But really why we put them here is because,
you know, there's just people who want to there's different personalities.
They want to get it done before they go to
you know, on their trip, and those there and now
you can get the exact same thing. So really, early season,

(01:05:47):
our city stores flourish.

Speaker 3 (01:05:49):
I mean, how busy are you right now? Is it crazy?

Speaker 12 (01:05:52):
Really?

Speaker 5 (01:05:52):
Yeah?

Speaker 12 (01:05:53):
You know, honestly, it's the most fun part of my job.
I was in the New York store this morning for
you know, and it's just I love when it's just
busy in there and everyone's talking about sport and skiing
and enjoying it.

Speaker 1 (01:06:05):
Very briefly, you bought a company back in twenty twelve
that is not a winter company. Yeah, and now that's
attached to the store in New York City. In terms
of running, how big of a growth area is running
for you?

Speaker 12 (01:06:17):
You know, that's I mean, the reason we got into
running was because we were runners to stay in shape
for skiing. I mean, you know, we all run, and
you know, it's part part of it. And then because
of the orthotics that we make, the custom you know,
the basis of the ski boot is used by so
many athletes and runners like Boston Marathon winners and so
many people. That's where it really came from, is that

(01:06:38):
we knew a lot about feet and running and what
we could do with that. It's great for us. It
gives us more of a year round business for us,
more opportunity for people.

Speaker 1 (01:06:49):
You also don't franchise at all. I'm sure this has
come up when people have come, hey, you should franchise this.
Why not?

Speaker 12 (01:06:56):
You know, we get asked once a week about the
franchising thing at least. But you know, it's just that
we wanted to have better quality control over it, and
we want to give our employees opportunity. And that's what
really comes down to is that we in order to
open more stores, we train people and when they're ready
to go to store. Like our most recent store we
opened in Big Sky. Chrisciardo, the manager there, worked for

(01:07:18):
us a long long time and he wanted to move there,
so we opened the store there.

Speaker 1 (01:07:23):
That's pretty cool.

Speaker 3 (01:07:24):
I think that's pretty cool. I mean, I'm also assuming
that folks have reached out to either invest in you
buy you up, like yeah, and you just you're you
want to continue to go it alone.

Speaker 12 (01:07:35):
Yeah, you know, I think it's it's we've had you know,
we have my have had minority investors and stuff in there.
But we've also had some hard knocks with those. And
so as long as we control the business and we
enjoy what we're doing, and you know, we have my
daughter is in the business, my you know, we have
family in the business, I want to do it for
a long time.

Speaker 1 (01:07:55):
Please go ahead.

Speaker 3 (01:07:56):
What's your supply chain? Like, is everything done in the
you and I in the US?

Speaker 12 (01:08:00):
I wish it was all done in the US. That's
you know, it's I really wish that it was done here,
but we're not able to. There's just things that or not. So, Yeah,
we've had challenges with the supply chain right now. We
try to mitigate them and the costs and.

Speaker 3 (01:08:14):
The territory costs have gone up.

Speaker 5 (01:08:16):
Yeah.

Speaker 12 (01:08:16):
Yeah, I mean that's a tough it's been a tough
thing too. Yeah, And I really think I look back
and say, wow, I was I'm glad this didn't happen
when we're in business five years or something I don't
I don't know how a small business gets through it.
You know, we're a little able to manage it a
little better.

Speaker 1 (01:08:30):
But yeah, there the biggest story in the ski industry
obviously is snow and making sure that people can actually
get on mountains. The second biggest story in pretty much
any ski town that you go to is the cost
of living. Yeah, and I'm wondering. You are known for
having these long tenured employees who live in the communities
where you have stores, and these are very transient communities

(01:08:53):
because they're they're ski areas where people come for the
season and then leave. How do you how do you
make sure that you can have employees that can actually
live somewhere like attracting and retaining a long term employee
in a place where truly nobody can afford to live.

Speaker 12 (01:09:07):
Yeah, it really has. I mean, you know, we talk
about it being so hard right now, but you know
there's been many points where it has been. But are
What we've always tried to do is make our employees
really productive the whole system that they do, and then
pay them the best that we can in there. But
it is a challenge, you know, in there, and you
have to yeah, we have to deal with that. I mean,

(01:09:28):
look at some of these markets are crazy, crazy expensive now,
so we have some employee housing, but the real thing
is how we keep employee housing.

Speaker 5 (01:09:37):
Yeah, yeah, we do.

Speaker 12 (01:09:38):
We have employee housing all the big markets, but that's
more for new new employees that are you know, coming
into the company.

Speaker 3 (01:09:47):
To help them get settled and yeah, yeah, you know, their.

Speaker 12 (01:09:49):
First second year. But all of our you know, management
and everything, we've always wanted the company, you know, I
always say, if we're not going up, we're going out.
We have to go up to give employees opportunity to
keep growing, keep growing there. And that gives employees opportunity
their stores keep growing, get bigger. They can be rewarded
more for that and compensated. But no doubt, it's it's

(01:10:10):
a big challenge.

Speaker 3 (01:10:11):
Where's the growth in your industry? Like, how do you think,
I mean, forty years you've been doing this. It sounds
like you still look for new opportunities constantly.

Speaker 12 (01:10:18):
I mean, really, what it comes down to is we're
still a small percentage. You know, we're probably somewhere around
three or four percent of the dollar volume of ski
boots sold in the world, and so we have a
lot of room to grow in that.

Speaker 1 (01:10:29):
Would you ever consider making your own ski boot? Just
to remind everybody, the shell, you buy the shell from
a company that makes the ski boot, and then you
do the liner and kind of everything else. But would
you ever make an actual surefoot ski boot?

Speaker 12 (01:10:41):
Yeah? I mean we have right now. We have three
D technology that we're working on and with boots and everything.
But I think as long as we can get the
shell that we think is really great for a customer
in the market, then we'll keep doing that. So what
we really do is we buy the shell without the liner,
so it saves the consumer money and then we have
a great shell and the outside and the interior we've made.

(01:11:03):
But we are always working on so if I come
up with a great idea about a shell, you'll see it.

Speaker 3 (01:11:11):
But in terms of growth, like, okay, no offense, but
I'm like thinking, wait, I got our thoughtics, but these
sound better, like can you? In terms of the medical market,
are people who go to foot doctors? What's the percentage
like through your machine like that you have.

Speaker 12 (01:11:24):
It's a percentage even in that Yeah, we're small, even
we're one of the largest makers of orthotics in the
United States, but like, actually kind of a long shot.
We are, but we make so many in our stores.
If you combine what we do in our stores and
what we do in our factory, we're by far the largest,
but there's lots of room because a lot of people
don't really know how beneficial they are to you. So

(01:11:46):
if something happens to you, if all of suddeny up
planar fasciitis, your foot's hurting, you're aching from running, that's
when you start seeking us out.

Speaker 3 (01:11:54):
So, Bob, if somebody comes in and gets an orthotic
through you, I mean, is it covered by insurance?

Speaker 12 (01:12:01):
It is if a doctor, you know, if they have
a prescription for it. Majority of what we sell are not.
That's not really true. In our medical division it's mostly prescription,
and then in our consumer it's not. But you know,
they are covered and they're the same scam so we
can make we can do anything with that.

Speaker 3 (01:12:19):
You know this it just seems like a mass market,
like it's major.

Speaker 12 (01:12:22):
It is a big market.

Speaker 1 (01:12:23):
Well, the reason you have that market is because you
bought this company and fit the Orthotics company based in Vancouver, Washington.
Back in twenty twenty three, you bought super Runner shops
back in twenty twelve, any more acquisitions on the horizon.

Speaker 12 (01:12:35):
You know, right now we're doing something really big that
We're about to introduce our own line of footwear. And
the footwear is made specifically for orthotics to fit your
orthotics in it, so you have a perfect platform. Like
right now in ski boots, you have a perfect platform
when we make the boot whole thing so you're standing
totally aligned.

Speaker 1 (01:12:54):
But a pair of shoes you pull out the insul,
the athotic's gonna be bigger than the insul, so it doesn't.

Speaker 12 (01:12:58):
Doesn't fit quite right, and you can't get it, you know,
in there. So we are late in a few weeks,
we're about to introduce a line of shoes that is
just for that. So when you get a line, scan
your bodies put into alignment, you put it to our shoes.
You're you're going to stand in a very balanced, comfortable position.

Speaker 3 (01:13:16):
You guys are doing this on your own or is
it a collaboration we're doing on our own.

Speaker 1 (01:13:20):
I think we're breaking some news here.

Speaker 12 (01:13:22):
You know, I've debated whether I should even say say
the sun here. But it's a big deal. We've been
working on it for years and It's really cool. We
have some I was just at the World Cup and
Veil and I had on a pair of the winter
boots and I had like four or five people ask
me about them?

Speaker 1 (01:13:39):
What are those?

Speaker 12 (01:13:39):
Where are they?

Speaker 5 (01:13:40):
Like?

Speaker 1 (01:13:40):
Oh?

Speaker 5 (01:13:41):
Nice?

Speaker 12 (01:13:41):
We have a little little luck here with the product.

Speaker 5 (01:13:44):
Men and women.

Speaker 12 (01:13:45):
Yeah, we have men and women. Yeah, of course we
have men and women. Ski run everything.

Speaker 1 (01:13:50):
Very cool. Hey, Bob, come back and hang out any
time you're in New York. Really appreciate foot here in
the Blueberg Studio. This is Blueberg.

Speaker 2 (01:14:04):
This is the Bloomberg Business Week Daily Podcast. Listen live
each weekday starting at two pm Eastern on Apple car
Play and Android Auto with the Bloomberg Business App. You
can also listen live on Amazon Alexa from our flagship
New York station Just Say Alexa played Bloomberg eleven thirty.

Speaker 3 (01:14:22):
Are you a circus kind of guy?

Speaker 1 (01:14:24):
I am a circus kind of guy.

Speaker 5 (01:14:26):
Are you really?

Speaker 1 (01:14:26):
Yeah? I'm a circus kind of guy, Carol. Do you
remember a couple of weeks ago we spoke about the
Tiger Global alum. His firm is betting on prying people
off their screens. Yes, money goes to travel, live events,
fitness of spectator sports.

Speaker 3 (01:14:38):
Right, and he's thinking about that in terms of investment places.

Speaker 1 (01:14:40):
Yeah, he's focused on.

Speaker 3 (01:14:42):
Yeah, So live events definitely our next guest focus our
companies behind the Ringling Brothers and Barnumum Barnum and Belly,
Monster Jam, also Disney and Ice, Monster Energy. I don't
even know all of these things. Am a Supercross and
the Supermotocross World Championship Room. Come on, Carol says the
dad of a little boy.

Speaker 1 (01:15:01):
We're talking about Feld Entertainment's family owned and operated. Here
with us now is Juliette Feld Grossman, ceofeld Entertainment. She
joins us from Florida. Julie, welcome, good at you on
the program Multiple events, eighty country, six continents. You've got
a great view of the consumer Hou's business.

Speaker 13 (01:15:18):
So, as you mentioned, we represent a number of different properties,
Ringling Brothers, farn Bailey, Circus, Monster Jam, Supermotocross and Disney
on Ice and across all of those properties, we do
about two thousand, eight hundred performances per year and two
hundred and forty cities performing to about fourteen million audience members.

(01:15:40):
And so we obviously see the economy from a lot
of different vantage points, and we are in many different
territories worldwide. I can tell you what we're seeing right
now in the US is really a tale of two economies,
which is playing out across a number of other industries
as well. So we see the AFFLA consumer who's you know,

(01:16:01):
excited to spend on VIP experiences, on merchandise, all of
the plussing up they can get. And then of course
we see you know, lower middle income consumers having a
harder time, less discretionary income due to other costs in
their lives. And so our focus is always on a
very wide and diverse, you know, economic spectrum. So we

(01:16:26):
put a lot of effort into reaching across that spectrum
to customers and offering a variety of price points and
reaching them through different marketing strategies to let them know
that we're here and that we have we have all
those options available.

Speaker 3 (01:16:42):
So who do you think your customer is? And I'm
looking like at Barnumum, Ringling Brothers and Barnum and Ballet
Circus tickets for the Barclay Center in twenty twenty six,
and I'm just kind of scrolling up right now. I'm
at tickets that are ninety five ninety nine.

Speaker 1 (01:16:57):
Are a reseller, Carol or are you Where are you going?

Speaker 3 (01:17:01):
Event ticketscenter dot com?

Speaker 5 (01:17:04):
Is that aseller?

Speaker 14 (01:17:05):
Well, we hope you'll go you we hope you'll buy direct.

Speaker 8 (01:17:09):
That is a reseller, all.

Speaker 3 (01:17:10):
Right, so talk to us about your pricing here all right,
I'm going to your site. Sorry, Google, talking another wrong place.
I'm blaming on Google. So in the venue, we've got
thousands of seats.

Speaker 13 (01:17:19):
So based on you know, how close you are, what
position you are, you know inside the venue, we offer
different pricing and in some cases we may also have
different experiences connected to you know, different price tickets. And
so where we have you know, front row tickets at
a at a higher price point, we also have tickets

(01:17:42):
that are higher up in the venue at more affordable
ticket prices. But what I will say is, you know,
somebody who's been producing these shows for many years now,
we always look to say, how can we make sure
we have a great experience for everybody who comes to
our shows. So we look at the quality of the
production from many different vantage points. Is we're developing it

(01:18:05):
so that no matter where you sit, you and your
family have that great experience you take home those memories
and hopefully you come back many more times.

Speaker 1 (01:18:14):
So in terms of the portfolio that you have, we're
showing a lot of footage from Ringling Brothers and Barnum
and Bailey right now, but you also do Disney on Ice,
you do motocross events, monster truck stuff. The portfolio in
terms of where revenue comes from, how is it divided?

Speaker 13 (01:18:29):
Well, we have many different tours, so by volume, we
have eight tours of Disney on Ice that travel globally.
We have five tours of Monster Jam, We have one
tour of Super Motocross at thirty one events across the
season that is also broadcast live, and then we have
one tour of Ringling Brothers, barnm and Bailey. But we're

(01:18:51):
very diversified in terms of our consumer touch points, so
we also have a merchandise business that accompanies all of
our tours. We have a very strong licensing program across
our owned properties. We also have media and broadcast rights
associated with some of our properties too.

Speaker 1 (01:19:08):
We're Bloomberg, so we love numbers. But you're a private
family health company. Can you just give us an idea
of size of revenue in twenty twenty five or twenty
twenty four for example.

Speaker 13 (01:19:19):
We are privately held, so we don't disclose that information.

Speaker 3 (01:19:22):
Is it growing, Yes, it is growing.

Speaker 13 (01:19:25):
And one of the things that we've strategically been working
on is, you know, we've been a company and business
that's about that special day, that day you get to
come to our event, and now we're increasingly working on
building that three hundred and sixty five day presence with
our customers, building out a more franchise oriented strategy. So
with Monster Jam, we since twenty twenty, we've been the

(01:19:48):
number one vehicle licensed worldwide, that's according to Sircana, and
so we have a very robust retail program with Walmart, Target, Amazon,
not only in the US globally. With Super Motocross, we
are on NBC and Peacock with our live broadcast. We
also have a video pass that goes to over one

(01:20:11):
hundred and forty countries and that's a subscription. So we
have a lot of different ways in which we're reaching consumers.
We're building out those touch points so that we continue
to stay with them all year round and be top
of mind.

Speaker 3 (01:20:25):
I'm curious, it's your portfolio. How do you expand it?

Speaker 14 (01:20:28):
What would you like to add to it well, we're
always looking at new opportunities. We continue to look at
new ip because we are both a property owner and
then we also license, and then we're also looking at
new ways of growing. Along with the relaunch of Ringling
Brothers Barnman Bailey in twenty twenty three, this fall, we

(01:20:48):
launched a Ringling Kids channel, So we're developing premium kids
content and a slate of characters that are introducing the
circus arts and a lot of humor and circus talent
into into families. And so we're looking there at building out,
you know, more retail product line. We're building out media
partnerships around that, and so we look at expanding our

(01:21:12):
reach in that way. And with Monster Jam as well,
we have you know, a number of media opportunities underway,
and we're excited to be growing not only our number
of properties, but also the ways in which we're connecting
with consumers and the monetization of those channels.

Speaker 1 (01:21:28):
Hey, on the circus side of things, you've you produced
the Circus for years. I've always wondered where you find
these performers and how you find these performers.

Speaker 3 (01:21:37):
Is it is it miss thinking about Juliet, you know,
it's this gig doesn't work out.

Speaker 1 (01:21:41):
Yeah, that's flexible, are you Yeah that ship is sales
not flexible enough, But you know, is it like this
is the major leagues are the farm teams, the regional
stuff all over the world, and you basically have scouts
go and you find them that way.

Speaker 13 (01:21:58):
We have an in house cast, seeing and talent team
who travel all over the world and they're visiting the
circus festivals, they're visiting schools. They're also in touch with
the network of coaches and families and talent that they know.
So we are sometimes looking at, you know, acts that

(01:22:18):
are already developed and created, but we're often creating our
own acts based on ideas we have for something that
you know, the audience has never seen before. What we
always want to do is surprise people and bring them
something that they haven't seen in a really new and
exciting way. So with this new production of Ringling Brothers,
we are so excited. We have a bike troop from

(01:22:40):
China that has never been to us before, and they're
doing incredible acrobatics on bikes, including at the very end
of the performance they have you know, about ten people
riding on bicycles and then one performer who runs across
the backs of all the people on the bicycles.

Speaker 3 (01:22:58):
It is unbelievable.

Speaker 2 (01:23:00):
It has never been.

Speaker 1 (01:23:01):
I did go to amazing, an amazing circus in China.

Speaker 3 (01:23:05):
Okay, I heard that. I was going to say, Juliette.
You know, Tim does ride bike. So I'm just saying,
like there is high wire. On a serious note, you know,
I think about circuses and acrobats and performers and different things,
and a lot of times it comes from you know,
individuals who are from outside the United States. Immigration. How
have you been impacted by immigration?

Speaker 13 (01:23:28):
We are fortunate we have a very good team here
who work on immigration. But we have performers from seventeen
different countries and it is quite challenging. So we do
work very far ahead of time to ensure we can
bring our performers in and the Sometimes there are challenges

(01:23:50):
in doing that. This time we were fortunate that we're
able to ring in everybody that we wanted to be
a part of this show. But I can tell you
in our last production, we have you know, a group
of male comedians from the Ukraine, and we actually had
to get a special notice from the Ukrainian Department of
Defense to allow them to be a part of Ringling

(01:24:13):
because they were not part of military service then. So
we you know, we work very hard to work to
bring the best performers here, and I think that's something
that really makes us stand out. Because we have this
infrastructure to support what we're doing, we can bring in
the best performers. We have a lot of experience and

(01:24:33):
a lot of credibility as the greatest shown ears well.

Speaker 3 (01:24:37):
Really great to get some time with you, So appreciated
and I hope we can get you back in the
new year. Good luck with the holiday season. Really great
to have with us. Juliet feld Grossman. She's chief executive
officer of FELED Entertainment, joining us.

Speaker 2 (01:24:51):
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(01:25:12):
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Bloomberg Businessweek Weekend - December 19th, 2025

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Tim Stenovec

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