December 1, 2023 • 42 mins
Bloomberg News Health Reporter Madison Muller explains how Pfizer’s second weight-loss setback this year is a warning sign that breaking into the lucrative obesity market isn’t going to be easy. Cory Klippsten, CEO at Swan Bitcoin, shares his crypto outlook for 2024. Benjamin Wolkon, Founding Partner at MUUS Climate Partners, talks about investing in climate funding. Bloomberg News Mexico Business Reporter Amy Stillman provides the details of her Businessweek Magazine story Chinese Sales Swamp Competition in Soaring Mexican Car Market. And we Drive to the Close with Carol Schleif, CIO at BMO Family Office.
Hosts: Carol Massar and Bailey Lipschultz. Producer: Paul Brennan.
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Episode Transcript
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Speaker 4 (00:54):
Shares a.
Speaker 2 (00:55):
Pfizer down more than five percent here their biggest interday
loss in more than three and a half years at
two at Not So Easy turning out a weight loss drug.
And we did have news earlier today Pfizer dropping development
of a twice daily version of it's a BCD pill.
There were a bunch of side effects. So let's get
to it on the beat with us Bloomberg News health
reporter Madison Mueller. She's back here in our Bloomberg Interactive
(01:17):
Brokers studio here with Balley and myself.
Speaker 4 (01:19):
So all right, what do we know about this?
Speaker 5 (01:21):
Yeah, So Pfizer has been developing a twice daily weight
loss pill and a pill, A pill, a pill. So
that's which we've talked about before. Pfizer Astrozenica some of
the drug makers that are not yet in this space
but want to be, because all of the pharmaceutical companies
want to be are looking to pills, you know, as
an inroad into this market. Because there's only one pill
(01:44):
on the market right now, it's a pill version of
ozembic and it's not very good for weight loss. So
this is an opportunity for other drug makers to get
in this space. And that's what Peiser sees, especially as
Pfizer has really taken a hit this year as demand
for its covid product, it's covid shot have sort of faded.
It's looking toward the next big thing, that being weight loss.
Speaker 4 (02:04):
Forty three percent this year.
Speaker 6 (02:06):
Yeah, the opposite of Novo, which is up forty nine
percent in Lily, which is up closer to sixty Right.
Speaker 5 (02:11):
Yeah, we're definitely saying a shift in the weight of
covid to weight loss unintended.
Speaker 2 (02:16):
What's crazy is Pfizer is massive. It's one hundred and
sixty two billion dollar market cap, and that I get it.
They're always doing a lot of R and D and
looking for those you know, blockbuster drugs. Having said that,
did they really just bet so much on covid that
it was going to keep kind of the revenue engine going.
Speaker 5 (02:34):
Yeah, And I mean they've they've looked at other infectious
disease like RSV and and they're investing more in cancer.
But it's just it's not giving the same lift that
Covid did, and like these weight loss drugs now are
doing for these other companies. So, you know, and what
we've seen is the market is reacting so much to
all of the news about these weight loss drugs. Every
time there's a new study out, there's ripple effects you know,
(02:57):
to far reaching in weight loss drugs this year, right,
it's just very disruptive, and so to have a negative
result is something that I mean, the company doesn't want
to see, investors don't want to see. And that is
what we saw with this twice daily pill in this study,
is that the side of there were so many side
effects that over half of the patients in the trial
(03:18):
had to stop taking it.
Speaker 6 (03:19):
And is this a space they have to be in
because they still have a single dose daily drug they're
studying right.
Speaker 5 (03:25):
Right exactly, And so that's sort of what they're pinning
their hopes on.
Speaker 7 (03:28):
Now.
Speaker 5 (03:29):
We're going to get data from that once daily pill
study in the first half of twenty twenty four, and
you know, we'll see what happens with that.
Speaker 6 (03:37):
If it doesn't work, do they have to acquire company
because they're still trying to acquire Segon right.
Speaker 4 (03:41):
That's a big deal, right right space. And that's the thing.
Speaker 5 (03:44):
I mean, some companies are looking to their own pipelines
to see what they can advance forward. The analysts that
I've spoken to have said that when it comes to Ffiser,
they probably will have to do some m and A
or have to acquire some company in order to bring
a viable asset into their pipeline. Which the good news
for them there is there are so many small biotech
companies now that are developing pretty innovative products. I mean,
(04:07):
biotechs really see this as a space where they can
potentially benefit, and so there are options out there.
Speaker 6 (04:12):
But how much are they behind though? If they buy
a company that's in phase one study so very early stage,
are they still trying to catch up to Lilly, Novo
and others.
Speaker 5 (04:21):
Yeah, and they are behind, But I think at the
end of the day, it's going to be about what
is the best product, because right now, the weight loss
pills that Novo's developing are not super They're not easy
to take. It's like you have to take it in
the morning every single day before eating food and then
wait thirty minutes to eat. So it's not exactly easier
(04:43):
necessarily than a once a week shot. And what we've
seen is just different side effects with the pills. They're
not any less expensive right now, at least than the shots,
and so there is space for these other drug makers
to get into this market, even if it's later. The
product is better at the end of the day.
Speaker 4 (05:01):
You know, it's interesting.
Speaker 2 (05:02):
There's a stack that's on my gainer's list today, Altimmune,
right and it's rallying because they gave some top line
results and they did amidst stage trial of their GLP
one therapy to treeoh PCD. So you're right, like there's
these a lot of smaller players out there. Having said that,
what's is it trickier in terms of a pill versus
a shot?
Speaker 4 (05:22):
Yeah?
Speaker 7 (05:22):
It is.
Speaker 4 (05:23):
It's harder.
Speaker 5 (05:23):
It's even though pills are sort of once you have
the formula down, they're a little bit easier to manufacture
a store transport, but the science behind developing a pill
is actually a little bit more difficult. And what we've
seen with the pills so far is that they just
don't cause as much weight loss as the shots do
because of sort of how they're metabolized in the body.
(05:44):
There are some more concerns about liver toxicity and things
like that. So it's actually a little bit trickier to
develop a pill.
Speaker 4 (05:50):
But it's the Holy Grail, isn't it?
Speaker 3 (05:51):
For this?
Speaker 5 (05:52):
I think that's how that's how the drugmakers see it, Yeah, exactly,
because I mean not everyone wants to take an injection
every week or every day.
Speaker 6 (05:59):
So have you gotten a sense from analysts and investors
if they do? See I mean just thinking if I
have to take a shot, but at least I'm losing
far more weight that weighs into the risk reward.
Speaker 5 (06:10):
No, yeah, I mean that's what ELI Lilly thinks. I mean,
they really still see a market in injectibles for them,
you know, for their business, and they have said, even
though Lily has struggled with supply shortages primarily due to
the injector puts that they use, and so pills for
them is something that actually could help with their supply issues.
(06:30):
But they're you know, there's their executives are saying, We're
not waiting for a pill to sort of save us
from these supply problems. We're investing billions of dollars now,
and we still really see a market for these injectibles.
Speaker 2 (06:42):
Talk to us about your beat, because you just came
back from Eli Lilly, you spent some time with them,
you know, tell us if you can what you can
share about the visit.
Speaker 4 (06:48):
Yeah, in this space.
Speaker 5 (06:49):
Yeah, I mean, it's it's interesting because Lily is one
of the oldest pharmaceutical companies. I mean, they've been around
for over one hundred years. They really got their start
commercializing insulin in nineteen twenty three, so they've been in
this diabetes space for forever, and that's why they're at
them and no Vote nineteen twenty three commercialized insulin. So
for a century, these drug makers have been head to
(07:11):
head in diabetes, continuing to innovate, and that's sort of
why we're in That's why we are where we are
today with both of them being at the forefront of
this weight loss market because the science and the investment
that they've put into diabetes has led to these weight
loss drugs.
Speaker 2 (07:27):
It makes so much sense because if you think about
is it forty fifty percent of the population right that
are either diabetic or pre diabetic. I mean, it's just massive.
And that's just I think the United States alone. So
you understand why all of these drug companies have been
in that space because it's a massive market. But their
continuation of R and D has led us to kind
of where we are today.
Speaker 5 (07:45):
Yeah, and it's interesting because you know, I don't know
if everyone knows this, but Lily is the company that
had Prozac, and so it's interesting to hear Lily talk
about the comparison between Prozac and now their weight loss drugs,
zet Bound because they said, you know, when we brought
prozac to market. There was a lot of stigma and
controversy around depression, and people thought depression wasn't a real
(08:07):
disease and that it was, you know, something that could
just be fixed with, you know, making yourself feel better
or whatever, going for a walk outside didn't really There
was a lot of that enigmas. Yeah, and they were
saying same thing with obesity. So we're sort of like
at the forefront. We were at the forefront of depression
treatments and now obesity treatments and trying to break the
stigma around that is part of this as well.
Speaker 6 (08:28):
Did you get a chance to ask them their thoughts
on whether they're reshaping McDonald's business model and Krispy Kreme
and whether or not requested? Yeah, airlines are going to
make more money because they require less fuel.
Speaker 8 (08:38):
Yeah.
Speaker 5 (08:39):
I mean they all kind of laugh it off, especially
like the airlines comments and the Walmart comments. I think
to these drug makers and to like I've talked to
a lot of the scientists that discovered these you know,
peptides and gut hormones back in the seventies and eighties,
and they're like, we never would have thought that this
would have turned into what it is today. You know,
back in the seventies and eighties is literally no one
(09:01):
cared about what we were doing. And then now the
CEO of Walmart is saying that it's affecting, you know,
the weight of baskets and stores like this is unbelievable,
but you know that's science.
Speaker 2 (09:11):
I think it also cut all of us off guard.
You have people also talking about apparel makers that you know,
you're gonna lose weight and you have to go out
and you know, buy a new wardrobe and stuff. So
it's kind of coming out in some very very different ways.
Fascinating beat, fascinating story. Love hearing about it. And it
sounds like Pfizer's not done yet.
Speaker 5 (09:28):
Yeah, they're not done yet. We'll wait to see what
happens in the first half of twenty twenty four.
Speaker 2 (09:32):
I guess one of our big themes, as I like
to say, TVD, TBD, about a lot of things right
now in our world. All right, Carol Master Alone with
Bailly Lipshelt, Madison Muller, Bloomberg News Health reporter, Thank you
so much.
Speaker 3 (09:43):
You're listening to the Bloomberg Business Week podcast. Catch us
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Speaker 6 (09:58):
Get tip too, a messets raging. What's up with that
NonStop rallies. I mean, even you look at the strength,
and this was before the market rally in November. We
saw it popping off in the second half of October,
going from about twenty seven thousand dollars a token to
north of thirty four thousand.
Speaker 4 (10:15):
It's quite a pop. And I'm even just looking at
the trade today.
Speaker 2 (10:18):
You know, Bitcoin's Epithereum's up, Cardono's up, Solana's up. If
you look at the Bloomberg Galaxy Crypto Index at eighteen
percent November, Bitcoin up about nine percent this past month,
and it's at its highest level of the year.
Speaker 6 (10:31):
Hi run, highest level since May of last year. So
we're seeing it really continuing to hit its strident trading
back towards that forty thousand dollars level.
Speaker 2 (10:40):
Bloomberg writing that bitcoins chances of hitting forty thousand dollars
top of mine crypto speculators they hit into the final
stretch of the year, so they're thinking can it go
even further, so something to kind of think about. There's
a lot going on though, and we are definitely see
as everybody expects, maybe the FED is done even thinking
about rates cutting. The risk trade is definitely on that
(11:01):
includes crypto. So what might twenty twenty four brings. So
let's get to it with our next guest. Corey Clipston
is CEO at Swan Bitcoin. It's the bitcoin only accumulation platform,
and he is back with us on Zoom from La Corey,
good to have you here with Bailey myself.
Speaker 9 (11:15):
How are you.
Speaker 10 (11:17):
I'm doing well, Carol, and thank you so much for
having me on and Bailey. Nice to be here with
you as well. I missed Tim. That's my usual guy.
Speaker 2 (11:24):
Say he's your guy, I will say hello. Talk to
us about the activity you guys have been seeing as
of late, especially as we've seen a move up. It
feels like across the board when it comes to crypto.
Speaker 10 (11:35):
Yeah, I mean we're in the good fortune to have
customers who like to buy when the price is down
as well, kind of the true believer crowd in the
bitcoin space. But absolutely influx of new users and big
spike in volumes. Really over the last two months. When
you saw that rise that you guys were just talking
about from twenty five to call it thirty five thirty six,
and now it seems like we might have some legs.
(11:56):
Feels very related to the latest round of news comeing
out of SEC whisperers about an ETF in January. But yeah,
this move seems to have some legs up above thirty
eight k head into forty.
Speaker 6 (12:09):
Yeah, and we saw Bloomberg Intelligence expects that ETF approvals
are starting mid January. Is that your expectation and kind
of how does that change the game for bitcoin?
Speaker 10 (12:20):
Yeah, it is probably my base case is that window
that now seems to have been narrowed to January eighth, ninth, tenth,
something in there. And that seems to make a lot
of sense given all the signals that we've gotten out
of the SEC and folks in the know. And I
think it changes quite a bit for bitcoin. And primarily
the story that I'm looking at is for the past
(12:40):
six years, from twenty seventeen through twenty twenty three, the
top of funnel for people looking to get into bitcoin
has been extremely noisy, polluted by all of the crypto
marketing schemes funded by fifty billion dollars of venture capital
trying to essentially market and dump crypto token. And now
(13:01):
you're replacing that with signal coming from the largest, most
trusted financial institutions on the globe, who are going to
be talking about the real signal in the space, which
is bitcoin very distinct from the rest of non bitcoin
crypto and that is now the top of funnel for bitcoin.
And it's a decent product. It's an IOU into an
ETF and it's kind of you know, it is paper bitcoin,
(13:22):
but it is backed. They have to buy the bitcoin,
it's not futures based. And I think that's a great
top of funnel for people to get into bitcoin and
then if they want to go a little deeper and
explore it and hold more. What we've seen historically is
that as people buy more and learn more, they take
self custody, and so they're going to graduate from that
ETF product into holding real bitcoin core.
Speaker 2 (13:42):
What do you know about who's buying the demographics of
actually crypto buyers, bitcoin buyers in particular.
Speaker 10 (13:48):
Yeah, so the buying public is, as you can imagine,
very widespread. It's easier to make the pitch two gen
z and millennials who aren't as encumbered by historical understandings
and kind of receive knowledge about the financial system. But
then when you look at it from an actual dollars in,
it obviously skews toward the boomers and the gen X
(14:09):
that actually have more money to be able to put in.
So you see more customers coming from the youth of
the country, but more dollars coming from those that are
more established and have more money today.
Speaker 2 (14:20):
How much more volumes up? You said you've noticed some
significant trends, but give us an idea. Can you give
us some numbers? I'm just curious about.
Speaker 4 (14:26):
Yeah, sure, because it gives us an idea.
Speaker 2 (14:28):
You're kind of one of the kind of feel like
ultimate risk trades, So it gives us an idea of
kind of what's an investor's mind, because we just had
what was it, money market funds?
Speaker 4 (14:37):
Was it yesterday? Hit a record high?
Speaker 2 (14:39):
So I'm just curious in trying to make sense of
kind of the investment environment overall, not apples to apples.
Speaker 10 (14:45):
First, I think I do have to address this idea
of bitcoin being a risk on trade, because that's counter
to how it's being marketed by the ETF guys. They're
talking about it as a safe haven and risk off,
so that narrative is being changed. And again it's all around.
It's not an inflation hedge in the terms of CPI,
(15:08):
but it's an inflation hedge in the terms of monetary inflation.
It's a hedge against printing more money, the original definition
of inflation. So I think that is a really interesting
thing to note. As far as volumes up about one
hundred percent, I would say in the last couple of months,
if you kind of just looked at September versus November,
which we're closing right now, it was probably up about
(15:30):
two x November over September.
Speaker 6 (15:33):
Is there a risk that this can be a sell
the news event, though, with so much excitement and that
jump that you were talking about from October to now.
Speaker 10 (15:42):
There is no such thing in any asset, including bitcoin,
of a straight walk up in a straight line to
some price that everyone expects in the future, because people
will always front run that and get exuberant and then
it'll always crash down. There has never been a large
bowl market swing in bitcoin that hasn't had a pullback
along the way of forty or fifty percent down, So
(16:04):
you know, I do believe that we are in the
early stages of what is very likely, given macroeconomic factors
and given domestic factors with the ETFs, et cetera, and
just kind of more people understanding what bitcoin is, that
we'll see another big bowl market at some time in
the future. And I think it's very likely that it
happens over the next couple of years. But hearing that,
(16:26):
we will absolutely see big drawdowns.
Speaker 2 (16:28):
Too, you know, career one of the things, you know,
kind of we kicked off talking about the expectations for
a spot a US pot Bitcoin ETF next year, and
so that has certainly given some enthusiasm back to the market.
But I also think about the legal overhang, and we
got rid of two big things SBF and FTX, and
also Binance, big deal, big settlement. I'm just curious there's
(16:50):
crack and still out there, right, there's some legal concerns.
I just wonder how you think about some of the
legal woes or surprises that could still certainly creep up
when it comes to this market.
Speaker 10 (17:01):
Yeah, it seems that bitcoin stands apart from everything that's
been going on in the crypto space, right, every single
non bitcoin crypto runs the risk of being targeted as
a security by the SEC in the United States, and
any crypto platform that isn't playing by the rules, let's
(17:22):
say as they exist on the books, runs the risk
of running a foul of a MLKYC violations money laundering. Essentially,
if they've been too loose with their customer onboarding and monitoring,
then it's very likely that they, whether purposefully or accidentally,
have facilitated bad people doing bad things on their platform,
(17:43):
as the DOJ has made very clear with respect to finance.
Speaker 6 (17:47):
So really, in your view, bitcoin is insulated from those
concerns and issues and bad actors, and that the clearing
out is bullish for the token.
Speaker 10 (17:56):
So if you're a bitcoin only company and you do
things on the up and up just like any other company,
you don't really have to worry about these sorts of things.
As far as Bitcoin as a monetary technology and payment rails,
it's technology, just like the dollar is technology, and bad
people will do bad things with money. So they can
use bitcoin, they can use dollars, they can use euros,
you on and yen to make transactions. There's nothing you
(18:18):
can do about that. It's just technology.
Speaker 11 (18:20):
It's neutral.
Speaker 2 (18:20):
What is you know, we just got about thirty forty
seconds left here, Corey, as we wrap up, as you
look ahead to twenty twenty four, you sound optimistic. I
hear it, no doubt about it, and it's it is
your book. But what is it that you do get
concerned about when it comes to the crypto environment. What
is the one possible downside that maybe might be top
of mind for you? Just about thirty forty seconds.
Speaker 10 (18:42):
I mean, honestly, the most interesting challenge I'm really looking
forward to taking on is to figure out how to
talk to people about our frenemies. Right, We're already being used,
Our people are already giving webinars inside of these large
trad five firms educated their people about bitcoin as they
ramp up their knowledge and their understanding. But at the
(19:03):
same time, we sell a competing product with selling real
bitcoin while they sell paper bitcoin. So I think just
figuring out that dance and being kind of all on
the same team and rising tide lifts all boats, and
knowing that this is going to be very good for
our business, but also understanding that as people get more
deeply educated and more financially invested in bitcoin, they're going
to want to own the real thing. And not an IOU,
(19:25):
and they're going to want to pay for it once
instead of having to pay for it every year. I
think that will be a winning message in the market
as well.
Speaker 2 (19:31):
All right, well listen, Happy New Year, Happy holidays, and
look forward to talking to you in twenty twenty four.
Corey Clipston of course, CEO. It's one bitcoin. Joining us
from LA.
Speaker 3 (19:41):
You're listening to the Bloomberg Business Week podcast. Catch us
live weekday afternoons from three to six Easter on Bloomberg Radio,
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live on Amazon Alexa from our flagship New York station
Just Say Alexa playing Bloomberg eleven thirty.
Speaker 2 (20:00):
Bailly Sauce story kind of was on my raidars I
was getting ready to prep for this guest Bezos Earth Fun.
They're going to put fifty seven million into climate food
solutions that include developing low methane livestock to curb emissions
of the potent greenhouse gas. Andy Jarvis is director of
the Future of Food program, and he talked about this
in a video interview from Dubai Food Systems. They when
(20:21):
it comes to growing, it, processing, distributing, consumed or thrown
away account for about a third of global greenhouse gas emissions.
Much of that footprint is linked to livestock farming, a
major source of methane, deforestation, biodiversity laws. So it's a
big contributor to climate change.
Speaker 4 (20:36):
Big deal.
Speaker 6 (20:36):
And that's one of those things when you debate almond
milk versus regular milk. Is almonds take a lot of water,
but also there are a lot of things that come
out of feeding in kind of milking account.
Speaker 2 (20:46):
Yeah, and I feel like that was a later discussion,
but livestock is really front and center. COP twenty eight
underway will be for the next couple of weeks, and
with that in mind, we welcome in our guest Benjamin Walcon.
He's founding partner at Muse Climate Partners. It's a venture
capital arama use and company. Its website says it invests
at the convergence of climate solutions and high tech applications.
Speaker 4 (21:05):
He's on Zoom in New York City.
Speaker 2 (21:07):
Ben, great to have you here. Tell us about your
firm and your investment philosophy.
Speaker 9 (21:12):
Thanks for having me on. At Muse Climate Partners, We're
focused on areas where technology can help us decarbonize the
economy faster. When we talk about the sectors that need
to go to net zero, we're talking about electric power, transportation, buildings, industry,
and agriculture. We need rapid scaling of technologies that can
replace dirtier incumbents with cleaner solutions, and we're looking at
(21:36):
investing in companies that can create those solutions in real time.
Speaker 4 (21:40):
All right, so where have you been investing.
Speaker 2 (21:41):
What do you think are some of the top investment
ideas that you've really been committing money too.
Speaker 9 (21:48):
Well, right now, we're really excited about the innovation that's
happening in home heating. As we know, heating is a
major cause of climate change. You have a lot of
homes that are powered by gas and by oil, but
there's this quiet revolution that's happening right now in heat pumps,
electric efficient systems that are much lower emissions. We're really
(22:10):
excited to be backing a company called Harvest Thermal, for example,
that's not only deploying heat pumps, but pairing those with
smart controls that can draw power from the grid when
renewables are online and match clean energy supply to home
energy demand. So that's one of those examples where analytics
and advanced software can be paired with a known climate
(22:31):
solution to make it even better, a better value proposition
around it, and something that can scale more rapidly. So
home heating is one thing that we're excited about, but
there's a lot of other invasion across electric power and others.
Speaker 2 (22:43):
I think this whole idea is really interesting when you
talk about what you guys are investing kind of smart thermal,
if you will, storage and heating. Having said that, how
expensive is it for like a home to do it?
Speaker 9 (22:56):
Well, it depends exactly on where you are. One thing
that we're really excited about is IRA, the Inflation Reduction
Act that passed a year ago a little over a
year ago, helps with incentives for homes. But even with
or without IRA, the payback of it is actually quite
rapid because you've reduced your energy builds so dramatically by
having such a more efficient system in place.
Speaker 2 (23:17):
So payback in four years, five years, three years, two years.
Speaker 9 (23:20):
It really depends on where you are geographically.
Speaker 6 (23:24):
Interesting, well, Ben, I guess looking at your portfolio broadly though,
what stage are some of these companies in, like how
big are they are? They producing these products in a
number of houses, are they still kind of early stage
and really more in like that study phase.
Speaker 9 (23:38):
Yeah, In in ventor Capital, the alphabet game has gotten
a little bit jumbled, where series A, series B, series
C could mean a lot of different things. So we
try to be very specific and say that right now
we're investing at the cusp of commercialization, which means we're
investing when companies have a great team in place, a
great early product in place, and they've either signed up
(24:00):
their first customers or they have credible, verifiable line of
sight to those first customers, and they're looking for a
funding ground that can help them accelerate and scale.
Speaker 6 (24:10):
Well, with the funding environment that we're in, it's difficult
for companies to get cash. How has that changed for
you guys putting money to work? Just given where we
are with rates as high as they are and they
kind of dearth of offerings both publicly and privately over
the last two years, I.
Speaker 9 (24:26):
Would say that we're sort of blown away by the
resilience of climate tech. Even with everything that's happening in
the broader market environment, there continues to be a great
deal of enthusiasm around the space. A lot of new
dry powder sort of popped up in the last two
or three years, and that really catalyzed a lot of
entrepreneurial talent coming into the space. People want to be
(24:48):
working on this solution. They want to be building things
that can help address climate change. So while I know
there's some data out there saying on a quarter to
quarter basis there might be some slowdowns, seeing as much
talent and as many opportunities in the space as we.
Speaker 4 (25:03):
Ever have, ben what about the EV space. I mean,
obviously we know all the big players.
Speaker 2 (25:06):
We've talked a lot about, you know, Elon Musk today
because of a cyber truck. But nonetheless there's you know,
global manufacturers increasingly have ramped up EV offerings, but it
does feel like the demand part of the equation has
fallen off. And I feel like we were just talking
about everybody kind of almost a tipping point, but it
just feels like, all of a sudden, there's a pullback.
What are you seeing in that space?
Speaker 9 (25:28):
You know, it's interesting because I have read those headlines,
So I looked into the data, and every quarter so
far in twenty twenty three has had higher EV sales
than that same quarter in twenty twenty two. And I
think we're just shy of four million EV sales per
quarter right now. So the market is growing and you're
hearing a number of individual auto makers saying that they're
(25:50):
hitting new records. I think the Ford F one fifty
Lightning was an example. So we're really excited about what
we're seeing there. From our standpoint at MUSE, Climate Partners
were looking at earlier stage opportunities. So for example, we
were an early investor in a company that's become the
number one electric farm tractor in the world, that's Monarch Tractor.
(26:11):
And we're also looking at opportunities of AI applications that
can help large corporations and large cities scale and manage
their electric vehicle fleets.
Speaker 6 (26:22):
Ben, we got about forty forty five seconds left here. Obviously,
I think everyone can agree that climate change getting away
from fossil fuels is a big next step. But getting
to those materials for batteries mining is poor, bad for
the environment. What do you do with batteries afterwards? How
do you strike a balance in terms of kind of
cleaner energy but with the cost that come to produce
those goods.
Speaker 9 (26:42):
Yeah, the entrepreneurial talent that's come to bearing climate tech
is also focused on this, and at MUSE Climate Partners,
we've backed a couple of companies that are looking at
the battery economy of the future. One of those is
a company called nth Cycle, which I believe has been
featured in Bloomberg a number of times, which is made
a next generation factory to reuse and reintroduce right metals
(27:04):
into the battery economy. Yeah, we've looked at a number
of others as well.
Speaker 8 (27:08):
Well.
Speaker 2 (27:08):
Come back soon, love to continue this conversation, Ben Walcon,
He's founding partner at News Climate Partners. Joining us on
zoom in New York City, Carol Masser along with Bailly Lipsheltz.
You are listening and watching Bloomberg BusinessWeek, and this is
Bloomberg Radio.
Speaker 3 (27:22):
You're listening to the Bloomberg Business Week podcast. Catch us
live weekday afternoons from three to six Eastern.
Speaker 7 (27:28):
Listen on Bloomberg dot com, the iHeartRadio app, and the
Bloomberg Business App, or watch us live on YouTube here in.
Speaker 4 (27:37):
The United States.
Speaker 2 (27:38):
You know you'd be hard pressed to find a Chinese
made car on the road. We're gonna talk about AI
a little bit later on, so we want to talk
a little bit about what's going on in the auto world.
You might see a rare pollstar here or there, but
in general, you're not seeing Chinese cars in the United States.
But you travel Bailey to our neighbor to the south,
quite a different story.
Speaker 6 (27:57):
Yeah, and that was the big finding from a terrific story,
terrifically reported story, basically diving into the fact that Mexico
is buying up a whole lot of Chinese cars, in
Chinese vehicles broadly.
Speaker 2 (28:10):
Yeah, who knew, right, It's one of those kind of stories,
which is what Bloomberg BusinessWeek does so well. Amy Stillman
is Mexico business reporter for Bloomberg News. She writes about
China's dominance in the soaring Mexican auto market the new
issue of Bloomberg Business Week, which is on newstands, online
and of course on the Bloomberg Amy, thank you so much.
You are joining us on zoom from Mexico City, So
tell us exactly what's going on and how dramatic it is.
Speaker 8 (28:33):
Thank you, Carol. Yeah, So, what we've been seeing is
that Chinese car sales have really been ticking up pretty
much since the pandemic. So really twenty twenty one twenty
twenty two, twenty twenty three, we're seeing a really big
increase this year alone, for the first ten months we
saw a fifty one percent increase in sales, and now
(28:53):
car sales are roughly about twenty sorry, Chinese car sales
are roughly about twenty percent of total sales in the market.
So it's really been a very, very big increase in
the last few years. And you know, part of the
motivation for that is that, you know, when you did
have the pandemic, you saw a lot of the Western
carmakers running into difficulty with inventories and issues around chip shortages,
(29:17):
and the Chinese automakers were really able to, you know,
come in there meet that demand and really have been
meeting a lot of consumers expectations on price and improvements
and quality as well.
Speaker 6 (29:29):
And how how has this shifted though, I'm looking at
a terrific chart that you have in this story that
China basically was not even remotely a player by any
stretch just a few years ago.
Speaker 8 (29:41):
Exactly exactly what we can say is that the Chinese
automakers have very aggressively been moving into into Mexico. You know,
it does give them a foothold in North America. It
has been traditionally very very difficult for the Chinese to
get into the US, so the fact that they have
been able to really expand in Mexico without much resistance
(30:03):
has really been a boon for the for the Chinese
car makers. At the same time, you know, what we're
seeing is that in China, while you've had this big
surge of electric vehicles, the regular gas powered vehicles aren't
in as much demand, and so there's actually an oversupply issue.
So a lot of those cars, the gas powered vehicles
are now coming over to Mexico. You know, you've seen
(30:25):
real differences in price, which here in Mexico that's a
very big deal for consumers. They don't have as much
access to financing as consumers in the US, for instance,
and so that's been very very attractive as well.
Speaker 2 (30:37):
Yeah, it's kind of interesting that it's all gasoline powered
vehicles when we are so obsessed with the ev world.
But that's not what's happening. But I get it in
terms of the market. But you do wonder if ultimately
Amy gives China and Chinese auto manufacturer is kind of
a leg up as the world increasingly moves towards evs.
Speaker 8 (30:57):
That certainly seems to be the next step. You've seen
also Chinese EV makers, like the biggest Chinese EV maker,
by D, has started to uh sell cars here in Mexico,
electric vehicles here. They've been negotiating deals with some of
the biggest Mexican conglomerates to to sell fleets of electric trucks.
(31:20):
They've also uh you know, launched a new deal with
a big retailer over here Liverpool to sell their cars
and as well as uh you know, install charging stations,
which is really speaking to you know, some of the
bottlenecks in Mexico around charging infrastructure. So certainly there's definitely
a push by the Chinese in the electric vehicle market
(31:41):
as well.
Speaker 6 (31:42):
And Amy, do you notice the shift. I feel like
when I see a Rivian, I'm like, oh, there's a
Rivian truck, or if I see Lucid Air it stands
out to me. Have you noticed really this penetration, this
jump in China made cars.
Speaker 8 (31:54):
Well, you know what's very interesting here is that if
you go to get an Uber, there's a good chance
that you're gonna be in a BYD electric vehicle, a
company here. Vemo has partnered with Uber and using BYD
electric vehicles to transport people around Mexico City. So if
you're in the city, if you take Uber, yeah, there's
a good chance that you're going to see the penetration
(32:16):
of some of these electric vehicles from the Chinese car
makers Jack as well. You're also seeing more of these
cars on the road, So there's certainly certainly a noticeable presence.
Speaker 6 (32:27):
So have you you've written in one then if they're
primarily ride sharing, did you like it?
Speaker 8 (32:32):
Yeah, yeah, you know, they're they're very uh, they're very interesting.
I spoke with the driver. She told me, you know,
it's great because you know, the vehicle won't start until
you buckle up, so it's a nice safety reminder. And
you know, in general, you know, they're very they seem
like very efficient, very very good cars.
Speaker 2 (32:49):
It does sound like that China has to watch. We
just got about twenty seconds left. Competition Amy is coming
from US manufacturers, Global manufacturers for Mexico.
Speaker 8 (32:57):
That's correct, that's correct. There are a lot of companies,
Western companies that are looking to build plants here. Of course,
the biggest one is Tesla. There's a lot of expectation
that that Tesla will launch in Mexico in the next
few years, and people are very excited about that as well.
So the Chinese car makers will certainly need to watch
for the competition.
Speaker 4 (33:15):
Very cool.
Speaker 2 (33:16):
Like I say, it's one of those Business Week stories
is like, wait, what I didn't know this was going on?
Amy Stillman, thank you so much, Mexican business reporter at
Bloomberg News joining us on zoom from Mexico City. It's
in the new issue, on newsstands, online and on the Bloomberg.
Speaker 4 (33:28):
This is Bloomberg Radio.
Speaker 6 (33:32):
Marco.
Speaker 2 (33:35):
A journal How about you let me drive?
Speaker 1 (33:38):
Oh no, no, no no, who's going to honey please?
Speaker 3 (33:42):
I'll do the riding gravel.
Speaker 8 (33:44):
Let's wat I.
Speaker 2 (33:44):
Want to try.
Speaker 7 (33:45):
It's the question that.
Speaker 3 (33:49):
T this is the drive to the Globe dot com effect?
Speaker 9 (33:55):
Well buyers? Should it on?
Speaker 3 (33:57):
On Bloomberg Radio?
Speaker 2 (34:00):
All right, everybody, just about eighteen minutes left in today's
trading session. And I'm not sure if you saw this
Bailey about Bloomberg Opinion columnist former CEO PIMCO Mohammad al
Arian writes today on the Bloomberg on how uncertainty looms
over this November to remember more specifically how investors and
Alice risk underestimating the challenges ahead during the period of
understandable market euphoria. I mean, it's been quite a run
(34:20):
up in November.
Speaker 6 (34:21):
Fascinating piece from miss el Aery and the interesting thing, Carol,
to your point, we saw the dow s and p
Russell all up about nine percent. ARC. Remember ARC, ARC
had its best month on percentage basis e ever thirty
one percent. I mean massive rallies cryptos, crypto, Bitcoin is
continuing to rally, and we.
Speaker 4 (34:37):
Started off today pretty red hot. I'm curious what our
next guest has to say.
Speaker 6 (34:40):
I know, and with that in mind, let's get to
the Drive to the Clothes with Carol Schleife. She is
the CIO at BEMO Family Office. Back with us in
the Bloomberg Interactive Brokers studio. Carol, how are.
Speaker 4 (34:50):
You doing great?
Speaker 11 (34:52):
It's lovely to be here and I love to see
the activity in downtown New York.
Speaker 4 (34:55):
It is nice, right, It's really great.
Speaker 2 (34:57):
It feels like the city is back in a big way.
Speaker 6 (35:01):
Especially on a Friday. I feel like my commute was
busy ghost Town. Then I get to the city coming
from the New Jerseys that I get here and everyone.
Speaker 11 (35:08):
There are a lot of tourists here for the weekend
Christmas in New York. What's not to love?
Speaker 4 (35:13):
It's the best.
Speaker 6 (35:14):
They just let up the tree here.
Speaker 2 (35:16):
Well, so let's say, you know, Mohammad al Arian seems
to be a little like, don't get ahead of yourself.
Speaker 4 (35:21):
How do you feel about that? Do you agree with him?
Speaker 3 (35:23):
Yeah?
Speaker 11 (35:23):
I would definitely agree with him, And especially it was
listening to the lead in about Paul saying we may
not be done and we're going to keep them highing
at the markets, like, oh no, they're done, We're actively.
Speaker 4 (35:35):
We're a little confused by that.
Speaker 11 (35:37):
Again, I actually think the only analogy it can come
with is when my teenagers sort of go, mom didn't
say no, she said maybe yeah, yeah, yeah, and and
maybe means yes yeah.
Speaker 6 (35:48):
I was going to say with that in mind, So
that's more of like because he was balanced, that inherently
is Dubvish.
Speaker 11 (35:53):
Yeah, exactly. And I think the markets, being discounting mechanisms
and looking ahead, are really trying to get towards it endgame.
We think it's premature. We do think they'll start to
cut at some point next year, definitely not in the
first quarter, and there's a lot of first half though
my own suspicion of our house view is we're not
(36:13):
going to peg it that close. But my suspicion is
it's later in the year because Chairman Paul can't be
very happy with the fact that the tenure came from
five and is down now flirting with four point two,
because they need they still need that inflation. The core
inflation is still running it twice what they wanted to run.
Speaker 2 (36:30):
I laugh because I feel like I've certainly been talking
about this other people.
Speaker 4 (36:33):
I'm like, don't worry, you'll get there, you know, refinance it.
Speaker 2 (36:35):
Like all of a sudden, we're watching the rates come down,
and I do wonder what kind of activity will come
out of this.
Speaker 11 (36:41):
And I do think because when you look at the
demographics of it, there's a whole bunch of pent up
demand demographically, and if you could get the prices of
the houses to come down, because a year and a
half ago, if you had said, we suspect they'll see
a huge upticket mortgage rates hit six percent, but right now,
if they hit six or six and a half percent,
I think you would get a lot of people coming
up out of the margins. Because there's you know, when
(37:03):
you get to the point where you start having kids,
or you have more kids and you out grow the
house and you want to be a bit philly.
Speaker 6 (37:09):
I just bought at six and an eighth and felt
like an idiot at the time, but now I feel like,
if you're lucky, I guess I don't really have.
Speaker 11 (37:15):
To I mean, here, I'm dating myself. My first mortgage
was twelve percent, and a year later I thought I
died to heven when I got to refinance at eight.
Speaker 6 (37:22):
Do we get anywhere near five rate cuts next year
like the market's pricing in.
Speaker 11 (37:26):
I don't know if we get five rate cuts, but
I think what the market will focus on is not
the number, but the trend and the fact. And I
think that's what the markets are really key in on.
But they got a bit ahead of themselves. We suspect,
just especially in the near term, both stock and bond markets,
with the exuberance you've got, because you do have a
lot of head ones that you're facing, and by the
time we get to January February, we're still facing again.
(37:49):
Can we keep the government open top to bottom?
Speaker 4 (37:51):
Do you think a recession's part of this?
Speaker 2 (37:52):
And I guess my other question is can we have
a recession with a decent job market, and then is
it a different type of recession which maybe is still support.
Speaker 4 (38:00):
Of See we've never this trade.
Speaker 11 (38:02):
Yeah, we've never been in the recession camp. We said
soft landing from the beginning on and continued to talk
about that and actually done when the whole rest of
the world jumped on soft landing. We were like, oh,
but there's a whole lot of things out there now
that might make this a little rocky, but there you
do have the underpinnings. The thing that goes unrecognized a
lot is we have so much fiscal stimulus coming into
(38:24):
the system still. Now, if that were to get reversed
because you had regime change, if you will, in terms
of after the elections next year, and you start appeeling
some of that back, that could put pressure on it.
And we do have to figure out how we're going
to pay for all of it, because that you know,
those concerns haven't gone away. They're a bit easier if
you don't have five percent ten years, you've got four
(38:46):
point two in terms of refinancing the debt. But we
were at the point where we were adding a trillion
dollars just to service the debt.
Speaker 6 (38:52):
And one question I have looking ahead to next year.
Nasac's re turning forty seven percent this year, sm P
twenty two percent, equal weight just eight, Right, what does
the market look like in twenty four given the dispersion
we saw in twenty three.
Speaker 11 (39:05):
We do think you get more broadening out. You have
to in order to sustain this ready, aren't we Yeah,
we are. And you saw it hinted at in the spring,
because through May it was the Magnificent seven, and then
in June into July you had a broadening and then
you had three really bad months and you're getting a
bit more broadening. But to your question about recession, we
have had rolling recessions underneath the surface, and we've seen
(39:28):
periods like that before, and I think if you step
back from it too, it's also indicative of the fact
that when you've got secular change going on in the markets,
in terms of initially I think people thought we were
going to go back to zero percent neutral rate, We're not.
That was the anomaly was the last ten or twelve years,
and so when you go through a period where you're
(39:49):
trying to reset expectations and anchor to new things. You
get a lot of this rolling around like we had,
where you get one trend that'll play for four to
six weeks and then it'll pull back and it'll go
a different direction. But if we can get this leveling
off in here where the economy does okay, interest rates
are reasonable and people have pricing power, I mean the
(40:10):
key will be to watch too in the next couple
of months with what happens with the consumers, because when
those credit card bills start coming due in January, the
heads yeah.
Speaker 2 (40:18):
Buying all the buy now, pay lead later, which which
you know, our intelligence analyst was saying that people feel
confident that they can pay it off in the couple
of months before rates.
Speaker 4 (40:26):
But it's just kind of interesting.
Speaker 11 (40:28):
Yeah, it is nerve wracking. And I suppose if you
get a December bonus and you're putting a few of
that on, I get them tucked.
Speaker 4 (40:33):
Away early, but you can take care of it.
Speaker 11 (40:35):
But I've also heard a lot of the stories too
about trying to get you know, the retailers are trying
to get that spending early because they're not sure people
are going to be able to sustain it through the season,
and it's been a long time since I've seen the
forty to fifty sixty percent offers starting around Halloween continuing
oh only through Black Friday. Oh, we'll extend it beyond it.
Speaker 4 (40:58):
I agree with you.
Speaker 2 (40:59):
The emails are content here real quickly twenty five thirty seconds.
You like industrials, healthcare, technology, technology? What do you like
in technology?
Speaker 4 (41:08):
Just quickly? I'm curious.
Speaker 11 (41:09):
I think they're figuring out the impact and where artificial
intelligence is going to play this piece of it, cybersecurity,
the buildout of infrastructure, it's all undergirded with technology.
Speaker 4 (41:21):
So it'll continue to be a themed next year. Great,
no doubt about it. Thank you. So do you have
a last one?
Speaker 3 (41:26):
No?
Speaker 6 (41:26):
No, I was just going to say, yeah, I guess
are you looking for like kind of tangential second para
derivative AI play?
Speaker 8 (41:31):
Yeah?
Speaker 11 (41:31):
I think so, especially because it's really interesting when you
think through what will it do for diagnostic imaging so
you don't have a radiologist looking through.
Speaker 4 (41:39):
I love that idea experience. Yeah, I think that's going
to be Powerful's huge. Carol's life, Happy holidays.
Speaker 2 (41:44):
Mary Christmas, chief investment Officer at VIMA Family Office and Studio,
This is Bloomberg.
Speaker 3 (41:50):
This is the Bloomberg Business Week Podcast. A Little Apple, Spotify,
and anywhere else you get your podcast. Listen live weekday
afternoons from three to six Eastern.
Speaker 7 (42:01):
On Bloomberg dot com, the iHeartRadio app, tune In, and
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Speaker 3 (42:05):
You can also watch us live every weekday on YouTube
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Speaker 4 (00:54):
Shares a.
Speaker 2 (00:55):
Pfizer down more than five percent here their biggest interday
loss in more than three and a half years at
two at Not So Easy turning out a weight loss drug.
And we did have news earlier today Pfizer dropping development
of a twice daily version of it's a BCD pill.
There were a bunch of side effects. So let's get
to it on the beat with us Bloomberg News health
reporter Madison Mueller. She's back here in our Bloomberg Interactive
(01:17):
Brokers studio here with Balley and myself.
Speaker 4 (01:19):
So all right, what do we know about this?
Speaker 5 (01:21):
Yeah, So Pfizer has been developing a twice daily weight
loss pill and a pill, A pill, a pill. So
that's which we've talked about before. Pfizer Astrozenica some of
the drug makers that are not yet in this space
but want to be, because all of the pharmaceutical companies
want to be are looking to pills, you know, as
an inroad into this market. Because there's only one pill
(01:44):
on the market right now, it's a pill version of
ozembic and it's not very good for weight loss. So
this is an opportunity for other drug makers to get
in this space. And that's what Peiser sees, especially as
Pfizer has really taken a hit this year as demand
for its covid product, it's covid shot have sort of faded.
It's looking toward the next big thing, that being weight loss.
Speaker 4 (02:04):
Forty three percent this year.
Speaker 6 (02:06):
Yeah, the opposite of Novo, which is up forty nine
percent in Lily, which is up closer to sixty Right.
Speaker 5 (02:11):
Yeah, we're definitely saying a shift in the weight of
covid to weight loss unintended.
Speaker 2 (02:16):
What's crazy is Pfizer is massive. It's one hundred and
sixty two billion dollar market cap, and that I get it.
They're always doing a lot of R and D and
looking for those you know, blockbuster drugs. Having said that,
did they really just bet so much on covid that
it was going to keep kind of the revenue engine going.
Speaker 5 (02:34):
Yeah, And I mean they've they've looked at other infectious
disease like RSV and and they're investing more in cancer.
But it's just it's not giving the same lift that
Covid did, and like these weight loss drugs now are
doing for these other companies. So, you know, and what
we've seen is the market is reacting so much to
all of the news about these weight loss drugs. Every
time there's a new study out, there's ripple effects you know,
(02:57):
to far reaching in weight loss drugs this year, right,
it's just very disruptive, and so to have a negative
result is something that I mean, the company doesn't want
to see, investors don't want to see. And that is
what we saw with this twice daily pill in this study,
is that the side of there were so many side
effects that over half of the patients in the trial
(03:18):
had to stop taking it.
Speaker 6 (03:19):
And is this a space they have to be in
because they still have a single dose daily drug they're
studying right.
Speaker 5 (03:25):
Right exactly, And so that's sort of what they're pinning
their hopes on.
Speaker 7 (03:28):
Now.
Speaker 5 (03:29):
We're going to get data from that once daily pill
study in the first half of twenty twenty four, and
you know, we'll see what happens with that.
Speaker 6 (03:37):
If it doesn't work, do they have to acquire company
because they're still trying to acquire Segon right.
Speaker 4 (03:41):
That's a big deal, right right space. And that's the thing.
Speaker 5 (03:44):
I mean, some companies are looking to their own pipelines
to see what they can advance forward. The analysts that
I've spoken to have said that when it comes to Ffiser,
they probably will have to do some m and A
or have to acquire some company in order to bring
a viable asset into their pipeline. Which the good news
for them there is there are so many small biotech
companies now that are developing pretty innovative products. I mean,
(04:07):
biotechs really see this as a space where they can
potentially benefit, and so there are options out there.
Speaker 6 (04:12):
But how much are they behind though? If they buy
a company that's in phase one study so very early stage,
are they still trying to catch up to Lilly, Novo
and others.
Speaker 5 (04:21):
Yeah, and they are behind, But I think at the
end of the day, it's going to be about what
is the best product, because right now, the weight loss
pills that Novo's developing are not super They're not easy
to take. It's like you have to take it in
the morning every single day before eating food and then
wait thirty minutes to eat. So it's not exactly easier
(04:43):
necessarily than a once a week shot. And what we've
seen is just different side effects with the pills. They're
not any less expensive right now, at least than the shots,
and so there is space for these other drug makers
to get into this market, even if it's later. The
product is better at the end of the day.
Speaker 4 (05:01):
You know, it's interesting.
Speaker 2 (05:02):
There's a stack that's on my gainer's list today, Altimmune,
right and it's rallying because they gave some top line
results and they did amidst stage trial of their GLP
one therapy to treeoh PCD. So you're right, like there's
these a lot of smaller players out there. Having said that,
what's is it trickier in terms of a pill versus
a shot?
Speaker 4 (05:22):
Yeah?
Speaker 7 (05:22):
It is.
Speaker 4 (05:23):
It's harder.
Speaker 5 (05:23):
It's even though pills are sort of once you have
the formula down, they're a little bit easier to manufacture
a store transport, but the science behind developing a pill
is actually a little bit more difficult. And what we've
seen with the pills so far is that they just
don't cause as much weight loss as the shots do
because of sort of how they're metabolized in the body.
(05:44):
There are some more concerns about liver toxicity and things
like that. So it's actually a little bit trickier to
develop a pill.
Speaker 4 (05:50):
But it's the Holy Grail, isn't it?
Speaker 3 (05:51):
For this?
Speaker 5 (05:52):
I think that's how that's how the drugmakers see it, Yeah, exactly,
because I mean not everyone wants to take an injection
every week or every day.
Speaker 6 (05:59):
So have you gotten a sense from analysts and investors
if they do? See I mean just thinking if I
have to take a shot, but at least I'm losing
far more weight that weighs into the risk reward.
Speaker 5 (06:10):
No, yeah, I mean that's what ELI Lilly thinks. I mean,
they really still see a market in injectibles for them,
you know, for their business, and they have said, even
though Lily has struggled with supply shortages primarily due to
the injector puts that they use, and so pills for
them is something that actually could help with their supply issues.
(06:30):
But they're you know, there's their executives are saying, We're
not waiting for a pill to sort of save us
from these supply problems. We're investing billions of dollars now,
and we still really see a market for these injectibles.
Speaker 2 (06:42):
Talk to us about your beat, because you just came
back from Eli Lilly, you spent some time with them,
you know, tell us if you can what you can
share about the visit.
Speaker 4 (06:48):
Yeah, in this space.
Speaker 5 (06:49):
Yeah, I mean, it's it's interesting because Lily is one
of the oldest pharmaceutical companies. I mean, they've been around
for over one hundred years. They really got their start
commercializing insulin in nineteen twenty three, so they've been in
this diabetes space for forever, and that's why they're at
them and no Vote nineteen twenty three commercialized insulin. So
for a century, these drug makers have been head to
(07:11):
head in diabetes, continuing to innovate, and that's sort of
why we're in That's why we are where we are
today with both of them being at the forefront of
this weight loss market because the science and the investment
that they've put into diabetes has led to these weight
loss drugs.
Speaker 2 (07:27):
It makes so much sense because if you think about
is it forty fifty percent of the population right that
are either diabetic or pre diabetic. I mean, it's just massive.
And that's just I think the United States alone. So
you understand why all of these drug companies have been
in that space because it's a massive market. But their
continuation of R and D has led us to kind
of where we are today.
Speaker 5 (07:45):
Yeah, and it's interesting because you know, I don't know
if everyone knows this, but Lily is the company that
had Prozac, and so it's interesting to hear Lily talk
about the comparison between Prozac and now their weight loss drugs,
zet Bound because they said, you know, when we brought
prozac to market. There was a lot of stigma and
controversy around depression, and people thought depression wasn't a real
(08:07):
disease and that it was, you know, something that could
just be fixed with, you know, making yourself feel better
or whatever, going for a walk outside didn't really There
was a lot of that enigmas. Yeah, and they were
saying same thing with obesity. So we're sort of like
at the forefront. We were at the forefront of depression
treatments and now obesity treatments and trying to break the
stigma around that is part of this as well.
Speaker 6 (08:28):
Did you get a chance to ask them their thoughts
on whether they're reshaping McDonald's business model and Krispy Kreme
and whether or not requested? Yeah, airlines are going to
make more money because they require less fuel.
Speaker 8 (08:38):
Yeah.
Speaker 5 (08:39):
I mean they all kind of laugh it off, especially
like the airlines comments and the Walmart comments. I think
to these drug makers and to like I've talked to
a lot of the scientists that discovered these you know,
peptides and gut hormones back in the seventies and eighties,
and they're like, we never would have thought that this
would have turned into what it is today. You know,
back in the seventies and eighties is literally no one
(09:01):
cared about what we were doing. And then now the
CEO of Walmart is saying that it's affecting, you know,
the weight of baskets and stores like this is unbelievable,
but you know that's science.
Speaker 2 (09:11):
I think it also cut all of us off guard.
You have people also talking about apparel makers that you know,
you're gonna lose weight and you have to go out
and you know, buy a new wardrobe and stuff. So
it's kind of coming out in some very very different ways.
Fascinating beat, fascinating story. Love hearing about it. And it
sounds like Pfizer's not done yet.
Speaker 5 (09:28):
Yeah, they're not done yet. We'll wait to see what
happens in the first half of twenty twenty four.
Speaker 2 (09:32):
I guess one of our big themes, as I like
to say, TVD, TBD, about a lot of things right
now in our world. All right, Carol Master Alone with
Bailly Lipshelt, Madison Muller, Bloomberg News Health reporter, Thank you
so much.
Speaker 3 (09:43):
You're listening to the Bloomberg Business Week podcast. Catch us
live weekday afternoons from three to six Eastern listen on
Bloomberg dot com, the iHeartRadio app and the Bloomberg Business app,
or watch us live on YouTube, so you would.
Speaker 6 (09:58):
Get tip too, a messets raging. What's up with that
NonStop rallies. I mean, even you look at the strength,
and this was before the market rally in November. We
saw it popping off in the second half of October,
going from about twenty seven thousand dollars a token to
north of thirty four thousand.
Speaker 4 (10:15):
It's quite a pop. And I'm even just looking at
the trade today.
Speaker 2 (10:18):
You know, Bitcoin's Epithereum's up, Cardono's up, Solana's up. If
you look at the Bloomberg Galaxy Crypto Index at eighteen
percent November, Bitcoin up about nine percent this past month,
and it's at its highest level of the year.
Speaker 6 (10:31):
Hi run, highest level since May of last year. So
we're seeing it really continuing to hit its strident trading
back towards that forty thousand dollars level.
Speaker 2 (10:40):
Bloomberg writing that bitcoins chances of hitting forty thousand dollars
top of mine crypto speculators they hit into the final
stretch of the year, so they're thinking can it go
even further, so something to kind of think about. There's
a lot going on though, and we are definitely see
as everybody expects, maybe the FED is done even thinking
about rates cutting. The risk trade is definitely on that
(11:01):
includes crypto. So what might twenty twenty four brings. So
let's get to it with our next guest. Corey Clipston
is CEO at Swan Bitcoin. It's the bitcoin only accumulation platform,
and he is back with us on Zoom from La Corey,
good to have you here with Bailey myself.
Speaker 9 (11:15):
How are you.
Speaker 10 (11:17):
I'm doing well, Carol, and thank you so much for
having me on and Bailey. Nice to be here with
you as well. I missed Tim. That's my usual guy.
Speaker 2 (11:24):
Say he's your guy, I will say hello. Talk to
us about the activity you guys have been seeing as
of late, especially as we've seen a move up. It
feels like across the board when it comes to crypto.
Speaker 10 (11:35):
Yeah, I mean we're in the good fortune to have
customers who like to buy when the price is down
as well, kind of the true believer crowd in the
bitcoin space. But absolutely influx of new users and big
spike in volumes. Really over the last two months. When
you saw that rise that you guys were just talking
about from twenty five to call it thirty five thirty six,
and now it seems like we might have some legs.
(11:56):
Feels very related to the latest round of news comeing
out of SEC whisperers about an ETF in January. But yeah,
this move seems to have some legs up above thirty
eight k head into forty.
Speaker 6 (12:09):
Yeah, and we saw Bloomberg Intelligence expects that ETF approvals
are starting mid January. Is that your expectation and kind
of how does that change the game for bitcoin?
Speaker 10 (12:20):
Yeah, it is probably my base case is that window
that now seems to have been narrowed to January eighth, ninth, tenth,
something in there. And that seems to make a lot
of sense given all the signals that we've gotten out
of the SEC and folks in the know. And I
think it changes quite a bit for bitcoin. And primarily
the story that I'm looking at is for the past
(12:40):
six years, from twenty seventeen through twenty twenty three, the
top of funnel for people looking to get into bitcoin
has been extremely noisy, polluted by all of the crypto
marketing schemes funded by fifty billion dollars of venture capital
trying to essentially market and dump crypto token. And now
(13:01):
you're replacing that with signal coming from the largest, most
trusted financial institutions on the globe, who are going to
be talking about the real signal in the space, which
is bitcoin very distinct from the rest of non bitcoin
crypto and that is now the top of funnel for bitcoin.
And it's a decent product. It's an IOU into an
ETF and it's kind of you know, it is paper bitcoin,
(13:22):
but it is backed. They have to buy the bitcoin,
it's not futures based. And I think that's a great
top of funnel for people to get into bitcoin and
then if they want to go a little deeper and
explore it and hold more. What we've seen historically is
that as people buy more and learn more, they take
self custody, and so they're going to graduate from that
ETF product into holding real bitcoin core.
Speaker 2 (13:42):
What do you know about who's buying the demographics of
actually crypto buyers, bitcoin buyers in particular.
Speaker 10 (13:48):
Yeah, so the buying public is, as you can imagine,
very widespread. It's easier to make the pitch two gen
z and millennials who aren't as encumbered by historical understandings
and kind of receive knowledge about the financial system. But
then when you look at it from an actual dollars in,
it obviously skews toward the boomers and the gen X
(14:09):
that actually have more money to be able to put in.
So you see more customers coming from the youth of
the country, but more dollars coming from those that are
more established and have more money today.
Speaker 2 (14:20):
How much more volumes up? You said you've noticed some
significant trends, but give us an idea. Can you give
us some numbers? I'm just curious about.
Speaker 4 (14:26):
Yeah, sure, because it gives us an idea.
Speaker 2 (14:28):
You're kind of one of the kind of feel like
ultimate risk trades, So it gives us an idea of
kind of what's an investor's mind, because we just had
what was it, money market funds?
Speaker 4 (14:37):
Was it yesterday? Hit a record high?
Speaker 2 (14:39):
So I'm just curious in trying to make sense of
kind of the investment environment overall, not apples to apples.
Speaker 10 (14:45):
First, I think I do have to address this idea
of bitcoin being a risk on trade, because that's counter
to how it's being marketed by the ETF guys. They're
talking about it as a safe haven and risk off,
so that narrative is being changed. And again it's all around.
It's not an inflation hedge in the terms of CPI,
(15:08):
but it's an inflation hedge in the terms of monetary inflation.
It's a hedge against printing more money, the original definition
of inflation. So I think that is a really interesting
thing to note. As far as volumes up about one
hundred percent, I would say in the last couple of months,
if you kind of just looked at September versus November,
which we're closing right now, it was probably up about
(15:30):
two x November over September.
Speaker 6 (15:33):
Is there a risk that this can be a sell
the news event, though, with so much excitement and that
jump that you were talking about from October to now.
Speaker 10 (15:42):
There is no such thing in any asset, including bitcoin,
of a straight walk up in a straight line to
some price that everyone expects in the future, because people
will always front run that and get exuberant and then
it'll always crash down. There has never been a large
bowl market swing in bitcoin that hasn't had a pullback
along the way of forty or fifty percent down, So
(16:04):
you know, I do believe that we are in the
early stages of what is very likely, given macroeconomic factors
and given domestic factors with the ETFs, et cetera, and
just kind of more people understanding what bitcoin is, that
we'll see another big bowl market at some time in
the future. And I think it's very likely that it
happens over the next couple of years. But hearing that,
(16:26):
we will absolutely see big drawdowns.
Speaker 2 (16:28):
Too, you know, career one of the things, you know,
kind of we kicked off talking about the expectations for
a spot a US pot Bitcoin ETF next year, and
so that has certainly given some enthusiasm back to the market.
But I also think about the legal overhang, and we
got rid of two big things SBF and FTX, and
also Binance, big deal, big settlement. I'm just curious there's
(16:50):
crack and still out there, right, there's some legal concerns.
I just wonder how you think about some of the
legal woes or surprises that could still certainly creep up
when it comes to this market.
Speaker 10 (17:01):
Yeah, it seems that bitcoin stands apart from everything that's
been going on in the crypto space, right, every single
non bitcoin crypto runs the risk of being targeted as
a security by the SEC in the United States, and
any crypto platform that isn't playing by the rules, let's
(17:22):
say as they exist on the books, runs the risk
of running a foul of a MLKYC violations money laundering. Essentially,
if they've been too loose with their customer onboarding and monitoring,
then it's very likely that they, whether purposefully or accidentally,
have facilitated bad people doing bad things on their platform,
(17:43):
as the DOJ has made very clear with respect to finance.
Speaker 6 (17:47):
So really, in your view, bitcoin is insulated from those
concerns and issues and bad actors, and that the clearing
out is bullish for the token.
Speaker 10 (17:56):
So if you're a bitcoin only company and you do
things on the up and up just like any other company,
you don't really have to worry about these sorts of things.
As far as Bitcoin as a monetary technology and payment rails,
it's technology, just like the dollar is technology, and bad
people will do bad things with money. So they can
use bitcoin, they can use dollars, they can use euros,
you on and yen to make transactions. There's nothing you
(18:18):
can do about that. It's just technology.
Speaker 11 (18:20):
It's neutral.
Speaker 2 (18:20):
What is you know, we just got about thirty forty
seconds left here, Corey, as we wrap up, as you
look ahead to twenty twenty four, you sound optimistic. I
hear it, no doubt about it, and it's it is
your book. But what is it that you do get
concerned about when it comes to the crypto environment. What
is the one possible downside that maybe might be top
of mind for you? Just about thirty forty seconds.
Speaker 10 (18:42):
I mean, honestly, the most interesting challenge I'm really looking
forward to taking on is to figure out how to
talk to people about our frenemies. Right, We're already being used,
Our people are already giving webinars inside of these large
trad five firms educated their people about bitcoin as they
ramp up their knowledge and their understanding. But at the
(19:03):
same time, we sell a competing product with selling real
bitcoin while they sell paper bitcoin. So I think just
figuring out that dance and being kind of all on
the same team and rising tide lifts all boats, and
knowing that this is going to be very good for
our business, but also understanding that as people get more
deeply educated and more financially invested in bitcoin, they're going
to want to own the real thing. And not an IOU,
(19:25):
and they're going to want to pay for it once
instead of having to pay for it every year. I
think that will be a winning message in the market
as well.
Speaker 2 (19:31):
All right, well listen, Happy New Year, Happy holidays, and
look forward to talking to you in twenty twenty four.
Corey Clipston of course, CEO. It's one bitcoin. Joining us
from LA.
Speaker 3 (19:41):
You're listening to the Bloomberg Business Week podcast. Catch us
live weekday afternoons from three to six Easter on Bloomberg Radio,
the Bloomberg Business app and YouTube. You can also listen
live on Amazon Alexa from our flagship New York station
Just Say Alexa playing Bloomberg eleven thirty.
Speaker 2 (20:00):
Bailly Sauce story kind of was on my raidars I
was getting ready to prep for this guest Bezos Earth Fun.
They're going to put fifty seven million into climate food
solutions that include developing low methane livestock to curb emissions
of the potent greenhouse gas. Andy Jarvis is director of
the Future of Food program, and he talked about this
in a video interview from Dubai Food Systems. They when
(20:21):
it comes to growing, it, processing, distributing, consumed or thrown
away account for about a third of global greenhouse gas emissions.
Much of that footprint is linked to livestock farming, a
major source of methane, deforestation, biodiversity laws. So it's a
big contributor to climate change.
Speaker 4 (20:36):
Big deal.
Speaker 6 (20:36):
And that's one of those things when you debate almond
milk versus regular milk. Is almonds take a lot of water,
but also there are a lot of things that come
out of feeding in kind of milking account.
Speaker 2 (20:46):
Yeah, and I feel like that was a later discussion,
but livestock is really front and center. COP twenty eight
underway will be for the next couple of weeks, and
with that in mind, we welcome in our guest Benjamin Walcon.
He's founding partner at Muse Climate Partners. It's a venture
capital arama use and company. Its website says it invests
at the convergence of climate solutions and high tech applications.
Speaker 4 (21:05):
He's on Zoom in New York City.
Speaker 2 (21:07):
Ben, great to have you here. Tell us about your
firm and your investment philosophy.
Speaker 9 (21:12):
Thanks for having me on. At Muse Climate Partners, We're
focused on areas where technology can help us decarbonize the
economy faster. When we talk about the sectors that need
to go to net zero, we're talking about electric power, transportation, buildings, industry,
and agriculture. We need rapid scaling of technologies that can
replace dirtier incumbents with cleaner solutions, and we're looking at
(21:36):
investing in companies that can create those solutions in real time.
Speaker 4 (21:40):
All right, so where have you been investing.
Speaker 2 (21:41):
What do you think are some of the top investment
ideas that you've really been committing money too.
Speaker 9 (21:48):
Well, right now, we're really excited about the innovation that's
happening in home heating. As we know, heating is a
major cause of climate change. You have a lot of
homes that are powered by gas and by oil, but
there's this quiet revolution that's happening right now in heat pumps,
electric efficient systems that are much lower emissions. We're really
(22:10):
excited to be backing a company called Harvest Thermal, for example,
that's not only deploying heat pumps, but pairing those with
smart controls that can draw power from the grid when
renewables are online and match clean energy supply to home
energy demand. So that's one of those examples where analytics
and advanced software can be paired with a known climate
(22:31):
solution to make it even better, a better value proposition
around it, and something that can scale more rapidly. So
home heating is one thing that we're excited about, but
there's a lot of other invasion across electric power and others.
Speaker 2 (22:43):
I think this whole idea is really interesting when you
talk about what you guys are investing kind of smart thermal,
if you will, storage and heating. Having said that, how
expensive is it for like a home to do it?
Speaker 9 (22:56):
Well, it depends exactly on where you are. One thing
that we're really excited about is IRA, the Inflation Reduction
Act that passed a year ago a little over a
year ago, helps with incentives for homes. But even with
or without IRA, the payback of it is actually quite
rapid because you've reduced your energy builds so dramatically by
having such a more efficient system in place.
Speaker 2 (23:17):
So payback in four years, five years, three years, two years.
Speaker 9 (23:20):
It really depends on where you are geographically.
Speaker 6 (23:24):
Interesting, well, Ben, I guess looking at your portfolio broadly though,
what stage are some of these companies in, like how
big are they are? They producing these products in a
number of houses, are they still kind of early stage
and really more in like that study phase.
Speaker 9 (23:38):
Yeah, In in ventor Capital, the alphabet game has gotten
a little bit jumbled, where series A, series B, series
C could mean a lot of different things. So we
try to be very specific and say that right now
we're investing at the cusp of commercialization, which means we're
investing when companies have a great team in place, a
great early product in place, and they've either signed up
(24:00):
their first customers or they have credible, verifiable line of
sight to those first customers, and they're looking for a
funding ground that can help them accelerate and scale.
Speaker 6 (24:10):
Well, with the funding environment that we're in, it's difficult
for companies to get cash. How has that changed for
you guys putting money to work? Just given where we
are with rates as high as they are and they
kind of dearth of offerings both publicly and privately over
the last two years, I.
Speaker 9 (24:26):
Would say that we're sort of blown away by the
resilience of climate tech. Even with everything that's happening in
the broader market environment, there continues to be a great
deal of enthusiasm around the space. A lot of new
dry powder sort of popped up in the last two
or three years, and that really catalyzed a lot of
entrepreneurial talent coming into the space. People want to be
(24:48):
working on this solution. They want to be building things
that can help address climate change. So while I know
there's some data out there saying on a quarter to
quarter basis there might be some slowdowns, seeing as much
talent and as many opportunities in the space as we.
Speaker 4 (25:03):
Ever have, ben what about the EV space. I mean,
obviously we know all the big players.
Speaker 2 (25:06):
We've talked a lot about, you know, Elon Musk today
because of a cyber truck. But nonetheless there's you know,
global manufacturers increasingly have ramped up EV offerings, but it
does feel like the demand part of the equation has
fallen off. And I feel like we were just talking
about everybody kind of almost a tipping point, but it
just feels like, all of a sudden, there's a pullback.
What are you seeing in that space?
Speaker 9 (25:28):
You know, it's interesting because I have read those headlines,
So I looked into the data, and every quarter so
far in twenty twenty three has had higher EV sales
than that same quarter in twenty twenty two. And I
think we're just shy of four million EV sales per
quarter right now. So the market is growing and you're
hearing a number of individual auto makers saying that they're
(25:50):
hitting new records. I think the Ford F one fifty
Lightning was an example. So we're really excited about what
we're seeing there. From our standpoint at MUSE, Climate Partners
were looking at earlier stage opportunities. So for example, we
were an early investor in a company that's become the
number one electric farm tractor in the world, that's Monarch Tractor.
(26:11):
And we're also looking at opportunities of AI applications that
can help large corporations and large cities scale and manage
their electric vehicle fleets.
Speaker 6 (26:22):
Ben, we got about forty forty five seconds left here. Obviously,
I think everyone can agree that climate change getting away
from fossil fuels is a big next step. But getting
to those materials for batteries mining is poor, bad for
the environment. What do you do with batteries afterwards? How
do you strike a balance in terms of kind of
cleaner energy but with the cost that come to produce
those goods.
Speaker 9 (26:42):
Yeah, the entrepreneurial talent that's come to bearing climate tech
is also focused on this, and at MUSE Climate Partners,
we've backed a couple of companies that are looking at
the battery economy of the future. One of those is
a company called nth Cycle, which I believe has been
featured in Bloomberg a number of times, which is made
a next generation factory to reuse and reintroduce right metals
(27:04):
into the battery economy. Yeah, we've looked at a number
of others as well.
Speaker 8 (27:08):
Well.
Speaker 2 (27:08):
Come back soon, love to continue this conversation, Ben Walcon,
He's founding partner at News Climate Partners. Joining us on
zoom in New York City, Carol Masser along with Bailly Lipsheltz.
You are listening and watching Bloomberg BusinessWeek, and this is
Bloomberg Radio.
Speaker 3 (27:22):
You're listening to the Bloomberg Business Week podcast. Catch us
live weekday afternoons from three to six Eastern.
Speaker 7 (27:28):
Listen on Bloomberg dot com, the iHeartRadio app, and the
Bloomberg Business App, or watch us live on YouTube here in.
Speaker 4 (27:37):
The United States.
Speaker 2 (27:38):
You know you'd be hard pressed to find a Chinese
made car on the road. We're gonna talk about AI
a little bit later on, so we want to talk
a little bit about what's going on in the auto world.
You might see a rare pollstar here or there, but
in general, you're not seeing Chinese cars in the United States.
But you travel Bailey to our neighbor to the south,
quite a different story.
Speaker 6 (27:57):
Yeah, and that was the big finding from a terrific story,
terrifically reported story, basically diving into the fact that Mexico
is buying up a whole lot of Chinese cars, in
Chinese vehicles broadly.
Speaker 2 (28:10):
Yeah, who knew, right, It's one of those kind of stories,
which is what Bloomberg BusinessWeek does so well. Amy Stillman
is Mexico business reporter for Bloomberg News. She writes about
China's dominance in the soaring Mexican auto market the new
issue of Bloomberg Business Week, which is on newstands, online
and of course on the Bloomberg Amy, thank you so much.
You are joining us on zoom from Mexico City, So
tell us exactly what's going on and how dramatic it is.
Speaker 8 (28:33):
Thank you, Carol. Yeah, So, what we've been seeing is
that Chinese car sales have really been ticking up pretty
much since the pandemic. So really twenty twenty one twenty
twenty two, twenty twenty three, we're seeing a really big
increase this year alone, for the first ten months we
saw a fifty one percent increase in sales, and now
(28:53):
car sales are roughly about twenty sorry, Chinese car sales
are roughly about twenty percent of total sales in the market.
So it's really been a very, very big increase in
the last few years. And you know, part of the
motivation for that is that, you know, when you did
have the pandemic, you saw a lot of the Western
carmakers running into difficulty with inventories and issues around chip shortages,
(29:17):
and the Chinese automakers were really able to, you know,
come in there meet that demand and really have been
meeting a lot of consumers expectations on price and improvements
and quality as well.
Speaker 6 (29:29):
And how how has this shifted though, I'm looking at
a terrific chart that you have in this story that
China basically was not even remotely a player by any
stretch just a few years ago.
Speaker 8 (29:41):
Exactly exactly what we can say is that the Chinese
automakers have very aggressively been moving into into Mexico. You know,
it does give them a foothold in North America. It
has been traditionally very very difficult for the Chinese to
get into the US, so the fact that they have
been able to really expand in Mexico without much resistance
(30:03):
has really been a boon for the for the Chinese
car makers. At the same time, you know, what we're
seeing is that in China, while you've had this big
surge of electric vehicles, the regular gas powered vehicles aren't
in as much demand, and so there's actually an oversupply issue.
So a lot of those cars, the gas powered vehicles
are now coming over to Mexico. You know, you've seen
(30:25):
real differences in price, which here in Mexico that's a
very big deal for consumers. They don't have as much
access to financing as consumers in the US, for instance,
and so that's been very very attractive as well.
Speaker 2 (30:37):
Yeah, it's kind of interesting that it's all gasoline powered
vehicles when we are so obsessed with the ev world.
But that's not what's happening. But I get it in
terms of the market. But you do wonder if ultimately
Amy gives China and Chinese auto manufacturer is kind of
a leg up as the world increasingly moves towards evs.
Speaker 8 (30:57):
That certainly seems to be the next step. You've seen
also Chinese EV makers, like the biggest Chinese EV maker,
by D, has started to uh sell cars here in Mexico,
electric vehicles here. They've been negotiating deals with some of
the biggest Mexican conglomerates to to sell fleets of electric trucks.
(31:20):
They've also uh you know, launched a new deal with
a big retailer over here Liverpool to sell their cars
and as well as uh you know, install charging stations,
which is really speaking to you know, some of the
bottlenecks in Mexico around charging infrastructure. So certainly there's definitely
a push by the Chinese in the electric vehicle market
(31:41):
as well.
Speaker 6 (31:42):
And Amy, do you notice the shift. I feel like
when I see a Rivian, I'm like, oh, there's a
Rivian truck, or if I see Lucid Air it stands
out to me. Have you noticed really this penetration, this
jump in China made cars.
Speaker 8 (31:54):
Well, you know what's very interesting here is that if
you go to get an Uber, there's a good chance
that you're gonna be in a BYD electric vehicle, a
company here. Vemo has partnered with Uber and using BYD
electric vehicles to transport people around Mexico City. So if
you're in the city, if you take Uber, yeah, there's
a good chance that you're going to see the penetration
(32:16):
of some of these electric vehicles from the Chinese car
makers Jack as well. You're also seeing more of these
cars on the road, So there's certainly certainly a noticeable presence.
Speaker 6 (32:27):
So have you you've written in one then if they're
primarily ride sharing, did you like it?
Speaker 8 (32:32):
Yeah, yeah, you know, they're they're very uh, they're very interesting.
I spoke with the driver. She told me, you know,
it's great because you know, the vehicle won't start until
you buckle up, so it's a nice safety reminder. And
you know, in general, you know, they're very they seem
like very efficient, very very good cars.
Speaker 2 (32:49):
It does sound like that China has to watch. We
just got about twenty seconds left. Competition Amy is coming
from US manufacturers, Global manufacturers for Mexico.
Speaker 8 (32:57):
That's correct, that's correct. There are a lot of companies,
Western companies that are looking to build plants here. Of course,
the biggest one is Tesla. There's a lot of expectation
that that Tesla will launch in Mexico in the next
few years, and people are very excited about that as well.
So the Chinese car makers will certainly need to watch
for the competition.
Speaker 4 (33:15):
Very cool.
Speaker 2 (33:16):
Like I say, it's one of those Business Week stories
is like, wait, what I didn't know this was going on?
Amy Stillman, thank you so much, Mexican business reporter at
Bloomberg News joining us on zoom from Mexico City. It's
in the new issue, on newsstands, online and on the Bloomberg.
Speaker 4 (33:28):
This is Bloomberg Radio.
Speaker 6 (33:32):
Marco.
Speaker 2 (33:35):
A journal How about you let me drive?
Speaker 1 (33:38):
Oh no, no, no no, who's going to honey please?
Speaker 3 (33:42):
I'll do the riding gravel.
Speaker 8 (33:44):
Let's wat I.
Speaker 2 (33:44):
Want to try.
Speaker 7 (33:45):
It's the question that.
Speaker 3 (33:49):
T this is the drive to the Globe dot com effect?
Speaker 9 (33:55):
Well buyers? Should it on?
Speaker 3 (33:57):
On Bloomberg Radio?
Speaker 2 (34:00):
All right, everybody, just about eighteen minutes left in today's
trading session. And I'm not sure if you saw this
Bailey about Bloomberg Opinion columnist former CEO PIMCO Mohammad al
Arian writes today on the Bloomberg on how uncertainty looms
over this November to remember more specifically how investors and
Alice risk underestimating the challenges ahead during the period of
understandable market euphoria. I mean, it's been quite a run
(34:20):
up in November.
Speaker 6 (34:21):
Fascinating piece from miss el Aery and the interesting thing, Carol,
to your point, we saw the dow s and p
Russell all up about nine percent. ARC. Remember ARC, ARC
had its best month on percentage basis e ever thirty
one percent. I mean massive rallies cryptos, crypto, Bitcoin is
continuing to rally, and we.
Speaker 4 (34:37):
Started off today pretty red hot. I'm curious what our
next guest has to say.
Speaker 6 (34:40):
I know, and with that in mind, let's get to
the Drive to the Clothes with Carol Schleife. She is
the CIO at BEMO Family Office. Back with us in
the Bloomberg Interactive Brokers studio. Carol, how are.
Speaker 4 (34:50):
You doing great?
Speaker 11 (34:52):
It's lovely to be here and I love to see
the activity in downtown New York.
Speaker 4 (34:55):
It is nice, right, It's really great.
Speaker 2 (34:57):
It feels like the city is back in a big way.
Speaker 6 (35:01):
Especially on a Friday. I feel like my commute was
busy ghost Town. Then I get to the city coming
from the New Jerseys that I get here and everyone.
Speaker 11 (35:08):
There are a lot of tourists here for the weekend
Christmas in New York. What's not to love?
Speaker 4 (35:13):
It's the best.
Speaker 6 (35:14):
They just let up the tree here.
Speaker 2 (35:16):
Well, so let's say, you know, Mohammad al Arian seems
to be a little like, don't get ahead of yourself.
Speaker 4 (35:21):
How do you feel about that? Do you agree with him?
Speaker 3 (35:23):
Yeah?
Speaker 11 (35:23):
I would definitely agree with him, And especially it was
listening to the lead in about Paul saying we may
not be done and we're going to keep them highing
at the markets, like, oh no, they're done, We're actively.
Speaker 4 (35:35):
We're a little confused by that.
Speaker 11 (35:37):
Again, I actually think the only analogy it can come
with is when my teenagers sort of go, mom didn't
say no, she said maybe yeah, yeah, yeah, and and
maybe means yes yeah.
Speaker 6 (35:48):
I was going to say with that in mind, So
that's more of like because he was balanced, that inherently
is Dubvish.
Speaker 11 (35:53):
Yeah, exactly. And I think the markets, being discounting mechanisms
and looking ahead, are really trying to get towards it endgame.
We think it's premature. We do think they'll start to
cut at some point next year, definitely not in the
first quarter, and there's a lot of first half though
my own suspicion of our house view is we're not
(36:13):
going to peg it that close. But my suspicion is
it's later in the year because Chairman Paul can't be
very happy with the fact that the tenure came from
five and is down now flirting with four point two,
because they need they still need that inflation. The core
inflation is still running it twice what they wanted to run.
Speaker 2 (36:30):
I laugh because I feel like I've certainly been talking
about this other people.
Speaker 4 (36:33):
I'm like, don't worry, you'll get there, you know, refinance it.
Speaker 2 (36:35):
Like all of a sudden, we're watching the rates come down,
and I do wonder what kind of activity will come
out of this.
Speaker 11 (36:41):
And I do think because when you look at the
demographics of it, there's a whole bunch of pent up
demand demographically, and if you could get the prices of
the houses to come down, because a year and a
half ago, if you had said, we suspect they'll see
a huge upticket mortgage rates hit six percent, but right now,
if they hit six or six and a half percent,
I think you would get a lot of people coming
up out of the margins. Because there's you know, when
(37:03):
you get to the point where you start having kids,
or you have more kids and you out grow the
house and you want to be a bit philly.
Speaker 6 (37:09):
I just bought at six and an eighth and felt
like an idiot at the time, but now I feel like,
if you're lucky, I guess I don't really have.
Speaker 11 (37:15):
To I mean, here, I'm dating myself. My first mortgage
was twelve percent, and a year later I thought I
died to heven when I got to refinance at eight.
Speaker 6 (37:22):
Do we get anywhere near five rate cuts next year
like the market's pricing in.
Speaker 11 (37:26):
I don't know if we get five rate cuts, but
I think what the market will focus on is not
the number, but the trend and the fact. And I
think that's what the markets are really key in on.
But they got a bit ahead of themselves. We suspect,
just especially in the near term, both stock and bond markets,
with the exuberance you've got, because you do have a
lot of head ones that you're facing, and by the
time we get to January February, we're still facing again.
(37:49):
Can we keep the government open top to bottom?
Speaker 4 (37:51):
Do you think a recession's part of this?
Speaker 2 (37:52):
And I guess my other question is can we have
a recession with a decent job market, and then is
it a different type of recession which maybe is still support.
Speaker 4 (38:00):
Of See we've never this trade.
Speaker 11 (38:02):
Yeah, we've never been in the recession camp. We said
soft landing from the beginning on and continued to talk
about that and actually done when the whole rest of
the world jumped on soft landing. We were like, oh,
but there's a whole lot of things out there now
that might make this a little rocky, but there you
do have the underpinnings. The thing that goes unrecognized a
lot is we have so much fiscal stimulus coming into
(38:24):
the system still. Now, if that were to get reversed
because you had regime change, if you will, in terms
of after the elections next year, and you start appeeling
some of that back, that could put pressure on it.
And we do have to figure out how we're going
to pay for all of it, because that you know,
those concerns haven't gone away. They're a bit easier if
you don't have five percent ten years, you've got four
(38:46):
point two in terms of refinancing the debt. But we
were at the point where we were adding a trillion
dollars just to service the debt.
Speaker 6 (38:52):
And one question I have looking ahead to next year.
Nasac's re turning forty seven percent this year, sm P
twenty two percent, equal weight just eight, Right, what does
the market look like in twenty four given the dispersion
we saw in twenty three.
Speaker 11 (39:05):
We do think you get more broadening out. You have
to in order to sustain this ready, aren't we Yeah,
we are. And you saw it hinted at in the spring,
because through May it was the Magnificent seven, and then
in June into July you had a broadening and then
you had three really bad months and you're getting a
bit more broadening. But to your question about recession, we
have had rolling recessions underneath the surface, and we've seen
(39:28):
periods like that before, and I think if you step
back from it too, it's also indicative of the fact
that when you've got secular change going on in the markets,
in terms of initially I think people thought we were
going to go back to zero percent neutral rate, We're not.
That was the anomaly was the last ten or twelve years,
and so when you go through a period where you're
(39:49):
trying to reset expectations and anchor to new things. You
get a lot of this rolling around like we had,
where you get one trend that'll play for four to
six weeks and then it'll pull back and it'll go
a different direction. But if we can get this leveling
off in here where the economy does okay, interest rates
are reasonable and people have pricing power, I mean the
(40:10):
key will be to watch too in the next couple
of months with what happens with the consumers, because when
those credit card bills start coming due in January, the
heads yeah.
Speaker 2 (40:18):
Buying all the buy now, pay lead later, which which
you know, our intelligence analyst was saying that people feel
confident that they can pay it off in the couple
of months before rates.
Speaker 4 (40:26):
But it's just kind of interesting.
Speaker 11 (40:28):
Yeah, it is nerve wracking. And I suppose if you
get a December bonus and you're putting a few of
that on, I get them tucked.
Speaker 4 (40:33):
Away early, but you can take care of it.
Speaker 11 (40:35):
But I've also heard a lot of the stories too
about trying to get you know, the retailers are trying
to get that spending early because they're not sure people
are going to be able to sustain it through the season,
and it's been a long time since I've seen the
forty to fifty sixty percent offers starting around Halloween continuing
oh only through Black Friday. Oh, we'll extend it beyond it.
Speaker 4 (40:58):
I agree with you.
Speaker 2 (40:59):
The emails are content here real quickly twenty five thirty seconds.
You like industrials, healthcare, technology, technology? What do you like
in technology?
Speaker 4 (41:08):
Just quickly? I'm curious.
Speaker 11 (41:09):
I think they're figuring out the impact and where artificial
intelligence is going to play this piece of it, cybersecurity,
the buildout of infrastructure, it's all undergirded with technology.
Speaker 4 (41:21):
So it'll continue to be a themed next year. Great,
no doubt about it. Thank you. So do you have
a last one?
Speaker 3 (41:26):
No?
Speaker 6 (41:26):
No, I was just going to say, yeah, I guess
are you looking for like kind of tangential second para
derivative AI play?
Speaker 8 (41:31):
Yeah?
Speaker 11 (41:31):
I think so, especially because it's really interesting when you
think through what will it do for diagnostic imaging so
you don't have a radiologist looking through.
Speaker 4 (41:39):
I love that idea experience. Yeah, I think that's going
to be Powerful's huge. Carol's life, Happy holidays.
Speaker 2 (41:44):
Mary Christmas, chief investment Officer at VIMA Family Office and Studio,
This is Bloomberg.
Speaker 3 (41:50):
This is the Bloomberg Business Week Podcast. A Little Apple, Spotify,
and anywhere else you get your podcast. Listen live weekday
afternoons from three to six Eastern.
Speaker 7 (42:01):
On Bloomberg dot com, the iHeartRadio app, tune In, and
the Bloomberg Business App.
Speaker 3 (42:05):
You can also watch us live every weekday on YouTube
and always on the Bloomberg journalone
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