November 4, 2025 • 39 mins
Watch Bloomberg Businessweek Daily LIVE every day on YouTube: http://bit.ly/3vTiACF.
Risky assets slid, with tech stocks and cryptocurrencies bearing the brunt of the selling, after long-simmering concerns about lofty valuations were fanned anew by a chorus of Wall Street executives who warned investors to brace for a pullback.
With the rally confined to fewer and fewer shares as sentiment and technical indicators show signs of overheating, the chiefs of giants from Capital Group to Goldman Sachs Group Inc. and Morgan Stanley noted the possibility of a pullback as a healthy development.
Nobody needs to look hard to find warnings that stocks look frothy after a record-breaking surge from April’s nadir pushed valuations to levels associated with exuberance. Optimism has grown heated in recent months, with many traders seeming too busy chasing the upside to worry about an expensive market.
The S&P 500 recently notched one of its best six-month stretches since the 1950s fueled by the resilience of Corporate America, the booming outlook for artificial intelligence and hopes the Federal Reserve will keep cutting rates to prop up the economy. Yet those solid gains combined with the recent narrowness of the advance spurred vulnerability worries.
Today's show features:
- Bloomberg Intelligence Global Equity Strategist Gillian Wolff on Tuesday’s tech-lead stock selloff
- Kathy Wylde, President and CEO of the Partnership for New York City, on the 2025 NYC Mayoral Election
- Mark Dixon, Founder & CEO of International Workplace Group, on earnings and the commercial real estate market
- Bloomberg News Cross-Asset Reporter Isabelle Lee on new market entrants reshaping the $13 trillion ETF industry
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:02):
Bloomberg Audio Studios, Podcasts, radio News. This is Bloomberg business
Week Daily reporting from the magazine that helps global leaders
stay ahead with insight on the people, companies, and trends
shaping today's complex economy. Plus global business finance and tech
(00:23):
news as it happens. The Bloomberg Business Week Daily Podcast
with Carol Masser and Tim Stenebeck on Bloomberg Radio.
Speaker 2 (00:32):
Matt Miller here with us today Bloomberg BusinessWeek. Stocks dropping
on this election day, the S and P five hundred
down almost one percent, Tech stocks getting crushed even further, Matt,
and really the only place to hide out is the
dollar and treasuries. Today there's also a course of Wall
Street executives warning investors to brace for a pullback and
(00:53):
mid lofty valuations.
Speaker 3 (00:55):
Jillian Wolf is here. Are you your doubtful?
Speaker 4 (00:57):
I mean, you know what, It's the first thing I
saw this morning when I logged on to the Bloomberg
terminal at like four point thirty in the morning, I
saw this story that Wall Street big wigs are warning
about a pullback.
Speaker 3 (01:07):
That's what happened.
Speaker 4 (01:08):
And then I read this story and it wasn't really
that much of a warning. I mean, they're saying, yeah,
within the next two years, you could see a five
to ten percent drop. Really, I think we all expect
that to be the case, that.
Speaker 3 (01:21):
That is very true. Let's get Jillian Wolf's take on this.
Speaker 2 (01:23):
She's a global equity strategist at Bloomberg Intelligence here with
us in the Bloomberg Business Week studio. Let's just start
right there, because that is the headline today that Wall
Street execs are warning.
Speaker 3 (01:34):
But that is right. Some of these warnings.
Speaker 2 (01:36):
Were like stocks could drop ten percent in a year, right,
easiest call to make right?
Speaker 5 (01:42):
Or what was it that sixty minutes interview that happened recently,
or somebody said, oh, eventually there will be a downturn.
Eventually there will be a downturn. I think we've been
hearing these warnings. I almost feel like for the past
eighteen months about is AI a bubble? Is there going
to be a downturn? Our stock's getting too hot and
we just haven't seen it occur yet. But I think
(02:02):
I want to point out two important things, which is
one that at the start of this year, investors with
a consensus really thought that AI Earning's growth was going
to slow, and the rest of the indix was going
to catch up. AI just gotten too hot, the comps
were too difficult. This had to be a bubble. The
rest of the market had to catch up. That was
the call starting twenty twenty five. Now that's been pushed
out to twenty twenty six. Again, astocks have actually done
(02:27):
much better on earnings that investors thought, and the rest
of the market has been lagging on earnings growth. So
this convergence thesis still gets pushed out further and further,
so the question of whether or not is AI a bubble.
We had that call at the start of the year
and it didn't play out, and the idea of this
just can't get much hotter. The second thing I do
think that investors are trying to look at right now though,
(02:47):
is capital discipline right? And I think the Meta call
last week told us a lot because Meta beat, but
they tanked on more capex spending. Then maybe investors with
the consensus would have liked to see. I think we're
now maybe entering a phase where it's not so much
about whether or not these AI stocks can deliver, but
are they maintaining enough discipline? Are they getting over their
(03:09):
skis right? Are they building out too fast, faster than
necessarily companies could adopt the technology. Whether or not eventually
companies will adopt the technologies is still to be seen.
But I think there's this concern trying to grow, Well,
are we going too fast with this level of investment?
Speaker 4 (03:25):
I mean, the one thing I would say about Meta
is that of the big hyperscalers, it doesn't have a
clear line to show you what kind of ROI they're
getting on their investment. Right, and Mark Zuckerberg seems the
most excited of all the major CEOs to overspend if possible.
Speaker 1 (03:44):
Right.
Speaker 4 (03:44):
He actually said, could we overspend by a couple of
one hundred billion dollars? Yes, but it's better than the alternative,
which is not spending enough. And that's not the kind
of sort of free wheeling, loose purse strings talk you
hear from the Microsoft CEO.
Speaker 5 (04:00):
But if anything, that tells you maybe that this isn't
this over league zuber and bubble, right, the idea that
you can spend too much, let's not get too over
zealous about the trade. Investors are still a bit wary
about it.
Speaker 4 (04:13):
Right.
Speaker 5 (04:13):
A bubble implies that you're investing in companies like in
two thousand that don't even have an earning stream yet
hoping that they eventually will. Now you're definitely seeing some
caution and maybe some lessons learned from that era. These
stocks aren't invincible, and usually people don't talk about a bubble,
and we're in a bubble, right. So the idea that
people are still keeping an eye out for these things
and there are phrases or trends that could take these
(04:36):
stocks down tells you a little bit that it's maybe
not a full blown bubble at least just yet.
Speaker 2 (04:41):
Your recent research has looked at some metrics that you
track at Bloomberg Intelligence about showing that investors still are
relatively calm, right.
Speaker 3 (04:53):
There's some pieces of data.
Speaker 2 (04:55):
That you're looking at that are showing that there's not
that much panic.
Speaker 3 (04:58):
When you look at I think it's bread right.
Speaker 4 (05:00):
Yeah.
Speaker 5 (05:00):
So when we look at we run our market Pulse
Sentiment Index, which takes a look at whether or not
investors are getting too manic or panicky. So typically when
they get to manic, that's a sign that the rallies
run too hot. Likely it historically has told us that
it's likely to slow down going forward. We aren't seeing
that right now. We aren't seeing that in any of
the underlying indicators that typically a signal over billions. We
(05:24):
are seeing low volatility stocks do rather poorly compared to
their high volatility counterparts. That's sort of a sign that
we're in risk on environment. But when you look at breadth,
when you look at how well highly levered versus low
leverage stocks are performing, we aren't seeing this mania that
usually leads to a drawback because you've just piled too
much into maybe more garbage stocks without keeping an eye
(05:48):
on what's actually happening underneath.
Speaker 4 (05:49):
What are we seeing in terms though, of companies hitting
weekly highs, companies hitting sorry, fifty two week highs, Yeah,
a fifty two week low. What's the hindenburg omen Well,
what we.
Speaker 5 (06:03):
Know is that the largest stocks, the MAG seven we
did analysis on this recently, are really what ultimately determine
the direction of the index. And this has really been
more and more true over the past twelve months that
the MAG seven are up on any given day, the
index will be up. With the Max seven are down,
the index will be down. I think there was a
day last week where the MAG seven it was the
day Meta reported the MAG seven were down on median,
(06:25):
So the index was down, but every other stock was
actually up on median and if you looked at the rest.
So I think looking at breadth metrics to kind of
tell you where the index might be going, We're not
really in that regime right now. We're in this very
highly concentrated regime where just because of the nature of
the index waiting, there's only a handful of stocks that
are really going to dictate its overall direction. That said,
the bottom isn't falling out from underneath the market or
(06:47):
anything like that. You don't just have these MAG seven
stocks doing incredibly well and everything else doing poorly. Like
I said, we just had a day recently where MAG
seven did poorly, everything else did well, market was still down.
So we look at it to kind of see We
look at breath to see, well, is the is the
bottom falling out from under the market. Is the market
doing well just because the MAG seven's doing well? But
that's definitely not what we're seeing right now.
Speaker 2 (07:08):
All right, Julian, global equity strategist at Bloomberg Intelligence, thank
you for joining us.
Speaker 6 (07:14):
Stay with us. More from Bloomberg Business Week Daily coming
up after this.
Speaker 1 (07:22):
You're listening to the Bloomberg Business Week Daily podcast. Catch
us live weekday afternoons from two to five eas during
listen on Applecarplay and Android Auto with the Bloomberg Business app,
or watch us live on YouTube.
Speaker 7 (07:37):
Now.
Speaker 4 (07:37):
On the latest installment of our weekly discussion, focused on Women,
Money and Power, we explore all the economic implications of
today's New York City mayoral election. Was one of the
most influential women in the history of Big Apple politics, and.
Speaker 3 (07:51):
That's Kathy Wilde.
Speaker 2 (07:52):
She joins to discuss her view on the New York
City mayoral election and how the city's next mayor will
impact the local and regional economy and it's related businesses.
She's also set to step down at the end of
the year from her role as president and CEO of
the Partnership for New York City, a business lobbying group
with three hundred and fifty CEOs in its ranks.
Speaker 4 (08:14):
And I should say that our owner and founder, Michael R.
Bloomberg and former New York City mayor, of course, gave
one of a half million dollars to a super pack
supporting Andrew M. Cuomo's bid for mayor and reiterated his
support for the former New York governor a week before
this election, so we do want to make that disclaimer.
Speaker 1 (08:36):
Now.
Speaker 4 (08:36):
Having said all of that, Kathy, welcome the program. Thank
you so much for joining us.
Speaker 8 (08:41):
Thank you.
Speaker 4 (08:41):
What's your overview of this of this race, because it
has been incredibly energetic and incredibly well followed.
Speaker 7 (08:48):
Well, I think, number one, it's exciting that we have
record turnouts at the polls for a local election, and
we have literally hundreds of thousands of newly registered voters
coming to the polls, a lot of them young people.
And as our country has become increasingly cynical about politicians
and their motives, it's great to see the level of
(09:11):
excitement that this election has generated, and particularly the candidacy
of a very young New Yorker thirty four year olds
on Mindanani, who is the is the Democratic nominee for
mayor of the city.
Speaker 2 (09:26):
The headline on the top of the Bloomberg Terminal today
New York City to decide if a socialist will run
the capital of capitalism. In your view, what does Wall Street,
what does the business community, the capitalist community of New
York City want out of this election?
Speaker 7 (09:44):
Well, I think what we want is political stability, and
I don't think that the voters going to the polls
are voting for mom Dani because he's a socialist or
because they think he's going to transform our capitalist system
them that is not within the power of any mayor,
and so we're not looking for a major economic change
(10:08):
in the city. I think what Mam Donnie's message has
been about, which the business community agrees with, is that
we are New York is the highest cost city in America.
Government spending at the state and city level has gone
up more than fifty percent over the past decade, and
we can't afford to keep that going. So everybody is
(10:31):
looking for a more affordable city. Now we've got opposite
ideas in many cases about how to get there. The
business communities position is raising taxes makes New York more expensive.
Mam Donnie's position started out being I'm going to raise
taxes to pay for cheaper housing and health and childcare
(10:53):
and cheaper groceries. I think that we've made some progress
in the last six months in getting him to take
a slightly more nuanced position where he has said I
have my goals of a more affordable city, but I
welcome the business community's advice on how to get there.
So I don't think that this is a crisis situation
(11:18):
regardless of the outcome of the mayor election. And I
do think it's great that more people are engaging in
local politics.
Speaker 4 (11:27):
I do hear the concern that he'll raise taxes voiced
from the traders and fund managers and analysts with whom
I speak every day on the Bloomberg terminal. They're not
the super rich, you know, billionaire class. They're mostly just
scraping by it as a very expensive city, you know,
to raise children in.
Speaker 3 (11:47):
Do you think even if.
Speaker 4 (11:49):
He wanted to raise taxes substantially, he has the power
to do so as mayor.
Speaker 7 (11:54):
The under our constitution, the mayor has no power to
raise incomer corporate taxes that belongs to the governor and
the state legislature. So no, I do not think that
there is a reason to be that concerned, because that's
going to be a conversation. The governor has said she
does not support tax increases at this time. And so
(12:19):
what we're looking at as a situation where even if
the mayor and the city council were to try to
raise expenditures beyond what is prudent that at that point
we have a fiscal control board that comes into play
that was set up after the financial crisis the physical
crisis the city faced in the nineteen seventies. We have
(12:41):
a financial control board that the governor the state controller
run that gets put in place automatically if the city's
budget goes out of whack. So we are we have
many protections to make sure that New York remains fiscally sound.
There is a debt limit. A mayor cannot borrow more
than a prudent amount without hitting that debt ceiling, So
(13:05):
there are lots of checks and balances in city government.
The mayor does have a great deal of power over
real estate decisions, land use zoning decisions, and was very
glad to see that. This morning, Mamdani joined with Andrew Cuomo,
another candidate, the former governor. He joined with him in
(13:28):
supporting three propositions on the ballot that would change the
city charter to help us develop more affordable housing, more
quickly and more cheaply. So I think that his housing
agenda is very consistent with what the private sector wants
to see. So in that area where he has real power,
real estate and land use, I think we're in sync
(13:51):
and Yeah.
Speaker 2 (13:51):
You still see these headlines about, you know, New York's
wealthy wanting to leave.
Speaker 3 (13:56):
Home prices in Connecticut going.
Speaker 2 (13:58):
Up because they want to leave New York Or do
you think those fears are overblown?
Speaker 3 (14:03):
Then?
Speaker 7 (14:03):
I think that people there is a danger of people
leaving New York because they can't afford the quality of
life they want in the city. Very expensive to buy
a home. To buy a home in Manhattan is now
over a million dollars. In Brooklyn and Queens it's over
seven hundred thousand dollars. Most of the population, like ninety
(14:26):
five percent cannot afford that, so we have an affordability crisis.
Childcare is costing twenty six thousand to forty thousand per
year per child. What you have to earn, a household
has to earn several hundred thousand dollars to be able
to afford the high rents over thirty five hundred bucks
a month now in terms of asking rents, you have
(14:49):
to earn a lot of money right now to live
in New York. That's what this campaign has been about,
and people are really voting for a more affordable city. Now,
I don't get a more affordable city by raising taxes,
So I think that's something that our next mayor is
going to find out pretty quickly.
Speaker 4 (15:08):
We are talking just as a reminder to Kathy Wild
from the Partnership for New York City for decades, one
of the city's most influential civic voices, and Kathy, I'm
getting a message right now from a listener whose voice
in kind of the same kind of surprise that I
was talking about with you during the commercial break. It
is wild that New York or that the Democratic Party
(15:31):
couldn't come up with anyone to challenge or Mamdani other
than a governor who was chased out of Albany by
his own party and a mayor who's basically been chased
out of office by his own party. Why couldn't the
Democrats come up with anyone qualified to challenge this thirty
four year old newcomer.
Speaker 7 (15:50):
Well, when he started out last September and his campaign's armed,
Mandani had less than one percent of the vote and
was considered a totally unlikely candidate to rise to the occasion.
He only became a viable candidate when Governor Cuomo got
into the race and basically the seven other Democrats in
the race starting with the current Mayor, Eric Adams, were
(16:13):
not seen by the voting public in the primary. The
other candidates were not, and the mayor dropped out of
the primary. He had probably the best chance of reelection
in many cases, but he dropped out, and that left
us with a good range of Democratic candidates, the city Controller,
(16:37):
the Speaker of the City Council, a state senator, the
former controller.
Speaker 9 (16:43):
We had.
Speaker 3 (16:43):
We had a good field.
Speaker 7 (16:45):
Of candidates, but the clear alternative during the course of
the election, the clear alternative to Mayor Adams and former
Governor Cuomo became Zorn Mandani, and he kind of emerged
out of the anti vote for the other candidates.
Speaker 2 (17:05):
You've arranged conversations between Mom Donnie and the business community.
You know, we talked a lot at the beginning of
this interview about the affordability crisis resonating with a lot
of New Yorkers.
Speaker 3 (17:18):
You don't have to name.
Speaker 2 (17:19):
Names, but I'm wondering if in those conversations anyone was
successfully convinced that maybe they were a skeptic of Mam Donnie,
and they came out of the conversations changing their mind.
Speaker 7 (17:31):
I think they came out of the conversations and the
meetings that we had and I we had a number
of them, and to his credit, right after the primary,
Zorn called me up and said, I would like to
give me the names and numbers of the business leaders
that I should speak to who are concerned about my
(17:52):
candidacy so I can reassure them my agenda is not
to socialized business. My agenda is to make this a
more affordable city of city of opportunity, which honestly is
a goal that we all share. So my experience in
seeing this is that people recognize he's a very smart,
(18:15):
very young man. The worry is would you hire this
person to run a three hundred thousand person corporation. The
answer to that is probably no, But if you're looking
for a mayor who is willing to bring in strong professionals,
and I think everybody felt better when he said he
(18:35):
would retain our current police commissioner, who has a terrific
track record and is very well regarded, Jessica Tish as
our current commissioner. He said that three weeks ago he
would ask her to stay. That made a big impact
because the question is will he bring in strong professionals
to run the city agencies? What people care about is
(18:58):
that we have a safe city, that the agencies are
all run well, that the sanitation department picks up the garbage,
that the education system produces smart kids, although that's what
city government does, and that all depends on who are
the commissioners, who are the mayor's deputies. And honestly, I
(19:22):
think Mamdannie could be a very good marketer of the city.
He's a compelling communicator, and honestly, that's a lot of
what Mike Bloomberg did for our city. He marketed New
York and brought us really out of the crisis of
nine to eleven and made New York a technology capital
of the world. He made an enormous contribution as on
(19:47):
restoring people's confidence, the people here and the people around
the world, restoring their confidence in New York. And Mamdani
has some of those salesman qualities that I think might
be very effective.
Speaker 4 (19:57):
Kathy, can I ask about your confidence in New York
as you prepare to pass the baton in terms of
the leadership of partnership for New York City. What's your
view on public private collaboration as you've spent years in
this job, and what's your hope for the city.
Speaker 7 (20:13):
Well, ironically, as government has less money, which is what
we anticipate with cutbacks in federal funds and the demands
for the needs that in the city for more government spending.
As government has less money, there's much more motivation to
bring in the private sector and build public private partnerships.
(20:33):
That's what happened after the fiscal crisis in the seventies.
That's when our organization and many others in the city
were created, where the private sector really took over leading
investment in a lot of areas. And I think that
we may go through the same cycle as we look
forward in terms of the fiscal situation of the city
and state being tough as the federal government cuts back,
(20:57):
and I think that will be that is the basis
for building new public private partnerships. When government has all
the money in the world, they certainly want to spend it,
but when they're broke, they're going to look to the
private sector. And the smart thing to do is look
for investment and ways to cut costs and to make
it more efficient to operate here. And that's an alternative
(21:22):
to raising taxes. And I'm hoping we're going to be
able to make that case to the next mayor.
Speaker 3 (21:27):
Kathy Wilde, thank you so much.
Speaker 2 (21:28):
That's Kathy Wilde, President and CEO of the Partnership for
New York City.
Speaker 3 (21:33):
We thank you for your time.
Speaker 6 (21:34):
If you are listening to the Bloomberg Business Weekdaily podcast,
catch us live weekday afternoons from two to five pm Eastern.
Listen on Applecarplay and Android Auto with the Bloomberg Business app,
or watch us live on YouTube.
Speaker 3 (21:50):
All Right.
Speaker 2 (21:50):
Mark Dixon, founder and CEO of International Workplace Group is
joining us on Zoom from Monaco to talk about the
company's latest earnings and the global commercial real state market.
More broadly, IWG is a provider of flexible workplace solutions
think hybrid working coworking spaces. They have four thousand locations
across more than one hundred and twenty countries. Mark founded
(22:12):
his company, which was first called Rigas, in nineteen eighty nine,
and then they renamed International Workplace Group just a few
years ago. Let's talk about iwg's latest results. Mark, thank
you for joining us. What are the results tell us
about the current state of flexible workspaces?
Speaker 8 (22:31):
Well, it's a look at the results today really reflect
growing momentum in the marketplace. More and more companies looking
to become more capital like, become more agile, more flexible,
so high levels of growth. We've seen the best revenue
(22:51):
growth that we've seen in a number of years in
this quarter. So good momentum ending the year and very
strong outlook for twenty twenty six.
Speaker 3 (23:03):
Mark.
Speaker 9 (23:03):
This is Barry Ritolts. I'm curious as to what you're
seeing in terms of return to office, the decreasing need
for broad and widespread leases, and how are you guys
taking advantage of that demand for flexible workplace.
Speaker 8 (23:22):
Well, look, this is the idea of return to office
is an old story. It's companies are still using offices
in a big way. It's a key component of supporting
workers maximizing productivity. The only thing that's changed is those
(23:45):
offices that people are using, workers are using are in
more convenient locations, so they're not all in downtown locations.
They're distributed. More and more companies are seeking to support
their workforce on a platform of work in many places
rather than in one place. But look, the office hasn't
(24:06):
gone away, it's just moved. We are supporting nine million
customers today, a million of those actually work from home.
Eight million are working from offices. It's a growth market.
The way people are consuming companies are consuming real estate
is changing fundamentally.
Speaker 2 (24:28):
How are you supporting a company that works from home?
How does that relationship works.
Speaker 8 (24:35):
We supply a whole range of services for an individual
that works from home. It services, furniture, the ability, most importantly,
the ability to drop into an office whenever they need one,
and to get base all the services you would get
(24:56):
in it if you were in an office. You get
them supplied from either home one office you drop into.
It's a growing part of our business. More and more
workers are working from in particular those people that are
working in a sort of back office functions. You know,
(25:16):
the whole commutes really makes no sense for many people,
and you know that market continues to grow.
Speaker 9 (25:25):
So Mark, you put the international in iw G. Are
you seeing any different types of trends in various countries?
Is it the same in the US as it might
be in the UK or Italy or France.
Speaker 8 (25:42):
It's similar. The US is a sort of trend leader
in this space. I mean, US companies are much quicker
to sort of latch onto a trend that helps them
spend less money or make more money. They're very focused
on force productivity, I think more so as we end
(26:03):
twenty five than at any time in the past. They're
all focused also on capital lights. So US companies are
adopting more quickly, and that's large US corporations mediums that
the smaller companies have always done.
Speaker 2 (26:17):
This.
Speaker 8 (26:18):
The same is happening across the world, whether that's Japan,
whether that's continental Europe. Huge growth for US in places
like it countries like Italy or France. So it's not
limited to any one country. I mean, I think that
the catalyst for all of this is advances in technology.
(26:39):
It's the technology that is available today that makes a
different way of working possible. So companies are moving to
there's more distributed working method because it helps productivity, because
it lowers costs, and because it's what workers want.
Speaker 2 (27:02):
I have to ask about New York City specifically, because
our city is kind of on everyone's mind today with
the elections. What is your view of just the office
real estate market specifically in New York City. It's kind
of hard to get a read on it because there
are of course more people working from home. But then
of course you see JP Morgan building a massive new
(27:24):
skyscraper in the middle of Midtown Manhattan. What is your
take on just the outlook for New York City office
real estate.
Speaker 8 (27:33):
Look, it's highly nuanced. And this is you know, if
you look at work overall, it's about one point two
billion white collar workers in the world. To go one
point two billion, it is highly nuanced. Now, what works
for JP Morgan in you know, in midtown New hook
City is not the same for all companies. So this
(27:57):
what we're seeing. I mean, we have a very successful
businesses growing New York City. It's a real sort of
hotbed of growth for us. But people are working differently.
So where companies may have had one thousand people in
(28:18):
midtown or in downtown, they may have one hundred people now,
and those hundred people tend to be housed in better
quality space. So what's happening in New York City and
many cities worldwide, is that companies are having less space
in the sort of central business districts, but they want
(28:41):
better space because it has to be a place that
people want to come into. So there's a move to quality.
The market's vibrant. New York is better I think now
than any time I've seen it since twenty nineteen, and
it's picking up pace all the time. And but but
(29:02):
still the market has changed. I mean it's fundamentally different
in that there are problems with B and C grade
properties where you used to have a lot of let's
call it more back office functions or the you know,
the cheaper activities, those have moved.
Speaker 9 (29:25):
Mark, in the last thirty seconds we have you guys
are in over one hundred countries. What areas do you
see growth That might be a little bit surprising to listeners.
Speaker 8 (29:36):
Well, look at the market we like is Africa. It's
you know, huge population in Africa and growing population. So
you know countries like Egypt, I mean Egypt is the
Middle East and Africa significant growth. Middle East overall is
a vibrant market. There is a lot of companies move
(30:00):
moving there, a lot of companies growing there. So you
know the market is moving. It's it's sort of yes,
it's I usual is still a sort of powerhouse of
growth and manufacturing. Right, but Middle Eastern Africa.
Speaker 3 (30:14):
On Mark Dixon, we have to cut you off, Founder
and CEO of I w G. Thanks for joining us,
Stay with us.
Speaker 1 (30:20):
More from Bloomberg Business Week Daily coming up after this.
Speaker 4 (30:32):
Here get the.
Speaker 9 (30:37):
Dry.
Speaker 6 (30:38):
Do I look like I drive a mini van?
Speaker 3 (30:41):
Shut up and don't drive angry.
Speaker 6 (30:44):
Don't drive angry, I'll drive show.
Speaker 3 (30:54):
This is the drive to the clothes. If you had
access to a car like this, would you take it
back right away? On Blue Bloomberg Radio, This is Bloomberg BusinessWeek.
Speaker 2 (31:04):
I'm Emily Grafeo, cross asset reporter at Bloomberg News.
Speaker 3 (31:07):
Here with Barry Ridholtz. How you doing, Emily, I don't
know what what do I call you?
Speaker 2 (31:12):
Host of the Master's in Business podcasts, Sure Market, co.
Speaker 9 (31:15):
Founder, co founder of rid Holts Wealth Management. Just general
pain in the bug. That's I'm here to point out
all the things that we do wrong with money all
the time and remind people please make fewer errors when
it comes to managing your assets.
Speaker 2 (31:35):
You know that advice kind of thematically makes you know,
it reminds me of a Wall Street legend, an etf legend,
Jack Bogel. He was really, of course into just you know,
let's make the Vanguard website so hard to log into,
so that you never have to log in and check
(31:55):
your investments, so you never sell, and then you turn
eighty all of a sudden.
Speaker 9 (31:59):
Then you have the reason he was against ETFs, and
I have broken with Saint Jack over the years. He
thought it made it too easy for people to trade
right their assets, whereas mutual funds you have to pick
up a phone call somebody, you don't get a print
till the end of the day. That sort of thing.
If only we had an ETF expert here to talk
(32:23):
about these things with.
Speaker 3 (32:24):
Let's get to the drive to the clothes.
Speaker 2 (32:26):
We're here with Bloomberg News cross asset reporter Isabelle Lee
in the Bloomberg Interactive Broker studio talking about ETFs and
talking about new entrance into the thirteen trillion dollar ETF industry.
This year we have sixty new entrance So this is issuers.
These are our fund managers coming up one day and
(32:48):
saying I want to launch an ETF.
Speaker 10 (32:50):
Yes, So this and last year we saw sixty new entrants.
And if you look at pre pandemic like twenty twenty two,
today we've seen more ETF launches than the period going
back to nineteenninety three when the first ETF was launched
in Canada, mind you, because that's what Canadians always like
to remind us of the Americans that they launched the
first ETF. So this is just we always talk about
(33:11):
how there are new ETFs in the market, but I
think we forget sometimes to talk about the new players
because you think that I mean, sure, round Hill, Rex,
Vanguard and all those, they will keep launching, But the
new players is what's interesting. For instance, this year we
saw a man group that's the world's largest privately publicly
list at Hedge Fund. They launch an ETF PICTA that's
a European asset manager in Europe. They have around nine
(33:32):
hundred trillion dollars in nine hundred billion dollars.
Speaker 3 (33:34):
In assets and they launch an ETF.
Speaker 10 (33:36):
And then in the story we highlight a twenty five
year old lady x Jane Street x MIT who also
launch an ETF as a one woman band. And all
she had was a great idea, maybe three hundred thousand
also to really start it going. And now it's live.
It has around six million assets, which is decent. But
it just shows that almost everyone what certain level of
proficiency proficiency can launch an ETF.
Speaker 9 (33:57):
So I speaking earlier this year todave Not, he's president
of ETF dot Com, and he told me there's going
to be a thousand new ETFs issued this year. That's
a giant number. What he mentioned that was so surprising
was how many of these were active, Yes, and then
on addition to that, there are some that are leverage, directional, bets,
(34:21):
option based, just very exotic derivative strategies. What are you
seeing in ETF world? And are any of these thousand
new ETFs gonna stick?
Speaker 10 (34:31):
So that's exactly what Emily and I, we sit next
to each other, we always talk about how fee compression
actually is a story of yesterday, because now to stand
out in this wild West where thirteen drillion dollars nearly
dominate this base with more than four thousand, five hundred products,
it's really just just have this crazy idea that will
make people's jaw drop. So this year we saw the
filing off on five X ETF. That's leverage ETF to
(34:54):
the maximum five X. We've never seen that before.
Speaker 9 (34:56):
Well, that to the mask, because doesn't that mean the
following year we're going to get a ten X.
Speaker 10 (35:00):
I don't even know if the five X will be approved.
We don't even know if three X will be approved.
In Europe they have a couple of three X ETFs,
but non tracking single stocks all usually indexes, but this
year we've seen that in the US three X launches,
five X launches. So because we're seeing active ETFs, fees
are actually becoming higher.
Speaker 3 (35:16):
And Emily rode A sorry about that.
Speaker 10 (35:17):
And I think investors just don't care so much because
what they want is this sophisticated strategy wrapped in an
ETF where you can just click by because now technology
has made it so easy and it confetti will probably
pop up, and then you have that ETF.
Speaker 2 (35:30):
In an ironic twist, and I'm going to bring up
Bogel again, Bogel may not have wanted this, but you know,
by making passive ETF so cheap, basically you can get
the S and P five hundred and ETF for like
no money, it almost opens up a slice of your
portfolio to add a five percent allocation to an ETF
that's more expensive. So that's what we're seeing that a
(35:53):
lot of these issuers feel like they actually have the
runway to launch something that's maybe ninety basis points. Talk
about what this story that you wrote about this extrage
street person, you know, coming out and launching their own ETF.
They're only twenty five years old. What did it teach
you about what the barriers.
Speaker 3 (36:10):
To entry are to this market? The buyer's work.
Speaker 10 (36:13):
It's becoming lower because look, you need less than half
a million dollars and you can launch an ETF. But
the story doesn't end there because you have to keep
it running. And not only do you have to keep
it running, up to market it and get flows. And
this is a title. Actually they're a full stack, white
label platform. They said you need around sixty five thousand
to set up a fund, around two hundred and twenty
five thousand to really just keep it going with operating expenses.
(36:35):
But then you need a great idea and you need
to get people to give you capital. And we've seen
that while we've seen record launches, closures are also on
the uptick. We've seen one ETF closed for every five
that have launched. I mean, probably just the product of
a healthy ecosystem, but we're really seeing that it's becoming
harder to stand out to survive, which is why you
(36:57):
see more and more of these niche crazy filings. But
a lot of the folks really so for instance, this
twenty five year old Sophia Massey, she handed out the
day to day outsourcing custody to a network of specialist providers.
Speaker 9 (37:08):
And so you mentioned the marketing of this, and some
of the ETFs that caught my ie earlier earlier this
year are from very well regarded, very popular analysts, guys
like Dan Ives and Tom Lee. Both of those have
attracted billions with the b of dollars two hundred and
(37:31):
twenty five thousand to launch two hundred and twenty five
thousand to carry it. Sounds like you need one hundred
million or two hundred million. If you hit a billion,
that's a successful ETF, isn't it absolutely?
Speaker 10 (37:43):
First of all, it depends like Sophia, she wants one
hundred million, she says, and she'll be happy.
Speaker 3 (37:47):
Of course.
Speaker 10 (37:47):
I'm sure the bigger the better. But one billion is
a stunning success. Tom Lee and dan Ives achieved those
benchmark milestones.
Speaker 3 (37:54):
In less than a year.
Speaker 10 (37:55):
So it goes to show that, yes, it really is,
because in the beginning people were probably like, they're just
talking heads, maybe what do they know about it? But
their followers followed and piled cash. I think now tomly
has nearly four billion dollars. I think dan Ives just
recently hit around one billion. So those are really impressive.
Speaker 9 (38:12):
But both of those guys were early to AI, early
to in video, early to tech. They're in the hot
space and have been there for quite a while. Not
a surprise a doom that well.
Speaker 10 (38:23):
And not only do they get closed, but their performance
is also great like you're today. Both ETFs are up
thirty one percent for Ives, twenty percent for Granny. So
sometimes you see Kathy would she there was a time
she was getting inflows but then performance was down. And
there was the time performance was up but she wasn't
getting the inflows. But both these guys have it.
Speaker 1 (38:41):
Both the killing it.
Speaker 2 (38:42):
It really speaks to the strength of having a winning strategy.
Isabell Ye Bloomberg News cross ass or reporter on everything
that has to do with the thirteen trillion dollar ETF industry.
Speaker 3 (38:53):
Thank you for joining us.
Speaker 6 (38:55):
This is the Bloomberg Business Week Daily podcast, available on app, Spotify,
and anywhere else you get your podcasts. Listen live weekday
afternoons from two to five pm Eastern on Bloomberg dot Com,
the iHeartRadio app, tune In, and the Bloomberg Business App.
You can also watch us live every weekday on YouTube
(39:15):
and always on the Bloomberg terminal
Bloomberg Audio Studios, Podcasts, radio News. This is Bloomberg business
Week Daily reporting from the magazine that helps global leaders
stay ahead with insight on the people, companies, and trends
shaping today's complex economy. Plus global business finance and tech
(00:23):
news as it happens. The Bloomberg Business Week Daily Podcast
with Carol Masser and Tim Stenebeck on Bloomberg Radio.
Speaker 2 (00:32):
Matt Miller here with us today Bloomberg BusinessWeek. Stocks dropping
on this election day, the S and P five hundred
down almost one percent, Tech stocks getting crushed even further, Matt,
and really the only place to hide out is the
dollar and treasuries. Today there's also a course of Wall
Street executives warning investors to brace for a pullback and
(00:53):
mid lofty valuations.
Speaker 3 (00:55):
Jillian Wolf is here. Are you your doubtful?
Speaker 4 (00:57):
I mean, you know what, It's the first thing I
saw this morning when I logged on to the Bloomberg
terminal at like four point thirty in the morning, I
saw this story that Wall Street big wigs are warning
about a pullback.
Speaker 3 (01:07):
That's what happened.
Speaker 4 (01:08):
And then I read this story and it wasn't really
that much of a warning. I mean, they're saying, yeah,
within the next two years, you could see a five
to ten percent drop. Really, I think we all expect
that to be the case, that.
Speaker 3 (01:21):
That is very true. Let's get Jillian Wolf's take on this.
Speaker 2 (01:23):
She's a global equity strategist at Bloomberg Intelligence here with
us in the Bloomberg Business Week studio. Let's just start
right there, because that is the headline today that Wall
Street execs are warning.
Speaker 3 (01:34):
But that is right. Some of these warnings.
Speaker 2 (01:36):
Were like stocks could drop ten percent in a year, right,
easiest call to make right?
Speaker 5 (01:42):
Or what was it that sixty minutes interview that happened recently,
or somebody said, oh, eventually there will be a downturn.
Eventually there will be a downturn. I think we've been
hearing these warnings. I almost feel like for the past
eighteen months about is AI a bubble? Is there going
to be a downturn? Our stock's getting too hot and
we just haven't seen it occur yet. But I think
(02:02):
I want to point out two important things, which is
one that at the start of this year, investors with
a consensus really thought that AI Earning's growth was going
to slow, and the rest of the indix was going
to catch up. AI just gotten too hot, the comps
were too difficult. This had to be a bubble. The
rest of the market had to catch up. That was
the call starting twenty twenty five. Now that's been pushed
out to twenty twenty six. Again, astocks have actually done
(02:27):
much better on earnings that investors thought, and the rest
of the market has been lagging on earnings growth. So
this convergence thesis still gets pushed out further and further,
so the question of whether or not is AI a bubble.
We had that call at the start of the year
and it didn't play out, and the idea of this
just can't get much hotter. The second thing I do
think that investors are trying to look at right now though,
(02:47):
is capital discipline right? And I think the Meta call
last week told us a lot because Meta beat, but
they tanked on more capex spending. Then maybe investors with
the consensus would have liked to see. I think we're
now maybe entering a phase where it's not so much
about whether or not these AI stocks can deliver, but
are they maintaining enough discipline? Are they getting over their
(03:09):
skis right? Are they building out too fast, faster than
necessarily companies could adopt the technology. Whether or not eventually
companies will adopt the technologies is still to be seen.
But I think there's this concern trying to grow, Well,
are we going too fast with this level of investment?
Speaker 4 (03:25):
I mean, the one thing I would say about Meta
is that of the big hyperscalers, it doesn't have a
clear line to show you what kind of ROI they're
getting on their investment. Right, and Mark Zuckerberg seems the
most excited of all the major CEOs to overspend if possible.
Speaker 1 (03:44):
Right.
Speaker 4 (03:44):
He actually said, could we overspend by a couple of
one hundred billion dollars? Yes, but it's better than the alternative,
which is not spending enough. And that's not the kind
of sort of free wheeling, loose purse strings talk you
hear from the Microsoft CEO.
Speaker 5 (04:00):
But if anything, that tells you maybe that this isn't
this over league zuber and bubble, right, the idea that
you can spend too much, let's not get too over
zealous about the trade. Investors are still a bit wary
about it.
Speaker 4 (04:13):
Right.
Speaker 5 (04:13):
A bubble implies that you're investing in companies like in
two thousand that don't even have an earning stream yet
hoping that they eventually will. Now you're definitely seeing some
caution and maybe some lessons learned from that era. These
stocks aren't invincible, and usually people don't talk about a bubble,
and we're in a bubble, right. So the idea that
people are still keeping an eye out for these things
and there are phrases or trends that could take these
(04:36):
stocks down tells you a little bit that it's maybe
not a full blown bubble at least just yet.
Speaker 2 (04:41):
Your recent research has looked at some metrics that you
track at Bloomberg Intelligence about showing that investors still are
relatively calm, right.
Speaker 3 (04:53):
There's some pieces of data.
Speaker 2 (04:55):
That you're looking at that are showing that there's not
that much panic.
Speaker 3 (04:58):
When you look at I think it's bread right.
Speaker 4 (05:00):
Yeah.
Speaker 5 (05:00):
So when we look at we run our market Pulse
Sentiment Index, which takes a look at whether or not
investors are getting too manic or panicky. So typically when
they get to manic, that's a sign that the rallies
run too hot. Likely it historically has told us that
it's likely to slow down going forward. We aren't seeing
that right now. We aren't seeing that in any of
the underlying indicators that typically a signal over billions. We
(05:24):
are seeing low volatility stocks do rather poorly compared to
their high volatility counterparts. That's sort of a sign that
we're in risk on environment. But when you look at breadth,
when you look at how well highly levered versus low
leverage stocks are performing, we aren't seeing this mania that
usually leads to a drawback because you've just piled too
much into maybe more garbage stocks without keeping an eye
(05:48):
on what's actually happening underneath.
Speaker 4 (05:49):
What are we seeing in terms though, of companies hitting
weekly highs, companies hitting sorry, fifty two week highs, Yeah,
a fifty two week low. What's the hindenburg omen Well,
what we.
Speaker 5 (06:03):
Know is that the largest stocks, the MAG seven we
did analysis on this recently, are really what ultimately determine
the direction of the index. And this has really been
more and more true over the past twelve months that
the MAG seven are up on any given day, the
index will be up. With the Max seven are down,
the index will be down. I think there was a
day last week where the MAG seven it was the
day Meta reported the MAG seven were down on median,
(06:25):
So the index was down, but every other stock was
actually up on median and if you looked at the rest.
So I think looking at breadth metrics to kind of
tell you where the index might be going, We're not
really in that regime right now. We're in this very
highly concentrated regime where just because of the nature of
the index waiting, there's only a handful of stocks that
are really going to dictate its overall direction. That said,
the bottom isn't falling out from underneath the market or
(06:47):
anything like that. You don't just have these MAG seven
stocks doing incredibly well and everything else doing poorly. Like
I said, we just had a day recently where MAG
seven did poorly, everything else did well, market was still down.
So we look at it to kind of see We
look at breath to see, well, is the is the
bottom falling out from under the market. Is the market
doing well just because the MAG seven's doing well? But
that's definitely not what we're seeing right now.
Speaker 2 (07:08):
All right, Julian, global equity strategist at Bloomberg Intelligence, thank
you for joining us.
Speaker 6 (07:14):
Stay with us. More from Bloomberg Business Week Daily coming
up after this.
Speaker 1 (07:22):
You're listening to the Bloomberg Business Week Daily podcast. Catch
us live weekday afternoons from two to five eas during
listen on Applecarplay and Android Auto with the Bloomberg Business app,
or watch us live on YouTube.
Speaker 7 (07:37):
Now.
Speaker 4 (07:37):
On the latest installment of our weekly discussion, focused on Women,
Money and Power, we explore all the economic implications of
today's New York City mayoral election. Was one of the
most influential women in the history of Big Apple politics, and.
Speaker 3 (07:51):
That's Kathy Wilde.
Speaker 2 (07:52):
She joins to discuss her view on the New York
City mayoral election and how the city's next mayor will
impact the local and regional economy and it's related businesses.
She's also set to step down at the end of
the year from her role as president and CEO of
the Partnership for New York City, a business lobbying group
with three hundred and fifty CEOs in its ranks.
Speaker 4 (08:14):
And I should say that our owner and founder, Michael R.
Bloomberg and former New York City mayor, of course, gave
one of a half million dollars to a super pack
supporting Andrew M. Cuomo's bid for mayor and reiterated his
support for the former New York governor a week before
this election, so we do want to make that disclaimer.
Speaker 1 (08:36):
Now.
Speaker 4 (08:36):
Having said all of that, Kathy, welcome the program. Thank
you so much for joining us.
Speaker 8 (08:41):
Thank you.
Speaker 4 (08:41):
What's your overview of this of this race, because it
has been incredibly energetic and incredibly well followed.
Speaker 7 (08:48):
Well, I think, number one, it's exciting that we have
record turnouts at the polls for a local election, and
we have literally hundreds of thousands of newly registered voters
coming to the polls, a lot of them young people.
And as our country has become increasingly cynical about politicians
and their motives, it's great to see the level of
(09:11):
excitement that this election has generated, and particularly the candidacy
of a very young New Yorker thirty four year olds
on Mindanani, who is the is the Democratic nominee for
mayor of the city.
Speaker 2 (09:26):
The headline on the top of the Bloomberg Terminal today
New York City to decide if a socialist will run
the capital of capitalism. In your view, what does Wall Street,
what does the business community, the capitalist community of New
York City want out of this election?
Speaker 7 (09:44):
Well, I think what we want is political stability, and
I don't think that the voters going to the polls
are voting for mom Dani because he's a socialist or
because they think he's going to transform our capitalist system
them that is not within the power of any mayor,
and so we're not looking for a major economic change
(10:08):
in the city. I think what Mam Donnie's message has
been about, which the business community agrees with, is that
we are New York is the highest cost city in America.
Government spending at the state and city level has gone
up more than fifty percent over the past decade, and
we can't afford to keep that going. So everybody is
(10:31):
looking for a more affordable city. Now we've got opposite
ideas in many cases about how to get there. The
business communities position is raising taxes makes New York more expensive.
Mam Donnie's position started out being I'm going to raise
taxes to pay for cheaper housing and health and childcare
(10:53):
and cheaper groceries. I think that we've made some progress
in the last six months in getting him to take
a slightly more nuanced position where he has said I
have my goals of a more affordable city, but I
welcome the business community's advice on how to get there.
So I don't think that this is a crisis situation
(11:18):
regardless of the outcome of the mayor election. And I
do think it's great that more people are engaging in
local politics.
Speaker 4 (11:27):
I do hear the concern that he'll raise taxes voiced
from the traders and fund managers and analysts with whom
I speak every day on the Bloomberg terminal. They're not
the super rich, you know, billionaire class. They're mostly just
scraping by it as a very expensive city, you know,
to raise children in.
Speaker 3 (11:47):
Do you think even if.
Speaker 4 (11:49):
He wanted to raise taxes substantially, he has the power
to do so as mayor.
Speaker 7 (11:54):
The under our constitution, the mayor has no power to
raise incomer corporate taxes that belongs to the governor and
the state legislature. So no, I do not think that
there is a reason to be that concerned, because that's
going to be a conversation. The governor has said she
does not support tax increases at this time. And so
(12:19):
what we're looking at as a situation where even if
the mayor and the city council were to try to
raise expenditures beyond what is prudent that at that point
we have a fiscal control board that comes into play
that was set up after the financial crisis the physical
crisis the city faced in the nineteen seventies. We have
(12:41):
a financial control board that the governor the state controller
run that gets put in place automatically if the city's
budget goes out of whack. So we are we have
many protections to make sure that New York remains fiscally sound.
There is a debt limit. A mayor cannot borrow more
than a prudent amount without hitting that debt ceiling, So
(13:05):
there are lots of checks and balances in city government.
The mayor does have a great deal of power over
real estate decisions, land use zoning decisions, and was very
glad to see that. This morning, Mamdani joined with Andrew Cuomo,
another candidate, the former governor. He joined with him in
(13:28):
supporting three propositions on the ballot that would change the
city charter to help us develop more affordable housing, more
quickly and more cheaply. So I think that his housing
agenda is very consistent with what the private sector wants
to see. So in that area where he has real power,
real estate and land use, I think we're in sync
(13:51):
and Yeah.
Speaker 2 (13:51):
You still see these headlines about, you know, New York's
wealthy wanting to leave.
Speaker 3 (13:56):
Home prices in Connecticut going.
Speaker 2 (13:58):
Up because they want to leave New York Or do
you think those fears are overblown?
Speaker 3 (14:03):
Then?
Speaker 7 (14:03):
I think that people there is a danger of people
leaving New York because they can't afford the quality of
life they want in the city. Very expensive to buy
a home. To buy a home in Manhattan is now
over a million dollars. In Brooklyn and Queens it's over
seven hundred thousand dollars. Most of the population, like ninety
(14:26):
five percent cannot afford that, so we have an affordability crisis.
Childcare is costing twenty six thousand to forty thousand per
year per child. What you have to earn, a household
has to earn several hundred thousand dollars to be able
to afford the high rents over thirty five hundred bucks
a month now in terms of asking rents, you have
(14:49):
to earn a lot of money right now to live
in New York. That's what this campaign has been about,
and people are really voting for a more affordable city. Now,
I don't get a more affordable city by raising taxes,
So I think that's something that our next mayor is
going to find out pretty quickly.
Speaker 4 (15:08):
We are talking just as a reminder to Kathy Wild
from the Partnership for New York City for decades, one
of the city's most influential civic voices, and Kathy, I'm
getting a message right now from a listener whose voice
in kind of the same kind of surprise that I
was talking about with you during the commercial break. It
is wild that New York or that the Democratic Party
(15:31):
couldn't come up with anyone to challenge or Mamdani other
than a governor who was chased out of Albany by
his own party and a mayor who's basically been chased
out of office by his own party. Why couldn't the
Democrats come up with anyone qualified to challenge this thirty
four year old newcomer.
Speaker 7 (15:50):
Well, when he started out last September and his campaign's armed,
Mandani had less than one percent of the vote and
was considered a totally unlikely candidate to rise to the occasion.
He only became a viable candidate when Governor Cuomo got
into the race and basically the seven other Democrats in
the race starting with the current Mayor, Eric Adams, were
(16:13):
not seen by the voting public in the primary. The
other candidates were not, and the mayor dropped out of
the primary. He had probably the best chance of reelection
in many cases, but he dropped out, and that left
us with a good range of Democratic candidates, the city Controller,
(16:37):
the Speaker of the City Council, a state senator, the
former controller.
Speaker 9 (16:43):
We had.
Speaker 3 (16:43):
We had a good field.
Speaker 7 (16:45):
Of candidates, but the clear alternative during the course of
the election, the clear alternative to Mayor Adams and former
Governor Cuomo became Zorn Mandani, and he kind of emerged
out of the anti vote for the other candidates.
Speaker 2 (17:05):
You've arranged conversations between Mom Donnie and the business community.
You know, we talked a lot at the beginning of
this interview about the affordability crisis resonating with a lot
of New Yorkers.
Speaker 3 (17:18):
You don't have to name.
Speaker 2 (17:19):
Names, but I'm wondering if in those conversations anyone was
successfully convinced that maybe they were a skeptic of Mam Donnie,
and they came out of the conversations changing their mind.
Speaker 7 (17:31):
I think they came out of the conversations and the
meetings that we had and I we had a number
of them, and to his credit, right after the primary,
Zorn called me up and said, I would like to
give me the names and numbers of the business leaders
that I should speak to who are concerned about my
(17:52):
candidacy so I can reassure them my agenda is not
to socialized business. My agenda is to make this a
more affordable city of city of opportunity, which honestly is
a goal that we all share. So my experience in
seeing this is that people recognize he's a very smart,
(18:15):
very young man. The worry is would you hire this
person to run a three hundred thousand person corporation. The
answer to that is probably no, But if you're looking
for a mayor who is willing to bring in strong professionals,
and I think everybody felt better when he said he
(18:35):
would retain our current police commissioner, who has a terrific
track record and is very well regarded, Jessica Tish as
our current commissioner. He said that three weeks ago he
would ask her to stay. That made a big impact
because the question is will he bring in strong professionals
to run the city agencies? What people care about is
(18:58):
that we have a safe city, that the agencies are
all run well, that the sanitation department picks up the garbage,
that the education system produces smart kids, although that's what
city government does, and that all depends on who are
the commissioners, who are the mayor's deputies. And honestly, I
(19:22):
think Mamdannie could be a very good marketer of the city.
He's a compelling communicator, and honestly, that's a lot of
what Mike Bloomberg did for our city. He marketed New
York and brought us really out of the crisis of
nine to eleven and made New York a technology capital
of the world. He made an enormous contribution as on
(19:47):
restoring people's confidence, the people here and the people around
the world, restoring their confidence in New York. And Mamdani
has some of those salesman qualities that I think might
be very effective.
Speaker 4 (19:57):
Kathy, can I ask about your confidence in New York
as you prepare to pass the baton in terms of
the leadership of partnership for New York City. What's your
view on public private collaboration as you've spent years in
this job, and what's your hope for the city.
Speaker 7 (20:13):
Well, ironically, as government has less money, which is what
we anticipate with cutbacks in federal funds and the demands
for the needs that in the city for more government spending.
As government has less money, there's much more motivation to
bring in the private sector and build public private partnerships.
(20:33):
That's what happened after the fiscal crisis in the seventies.
That's when our organization and many others in the city
were created, where the private sector really took over leading
investment in a lot of areas. And I think that
we may go through the same cycle as we look
forward in terms of the fiscal situation of the city
and state being tough as the federal government cuts back,
(20:57):
and I think that will be that is the basis
for building new public private partnerships. When government has all
the money in the world, they certainly want to spend it,
but when they're broke, they're going to look to the
private sector. And the smart thing to do is look
for investment and ways to cut costs and to make
it more efficient to operate here. And that's an alternative
(21:22):
to raising taxes. And I'm hoping we're going to be
able to make that case to the next mayor.
Speaker 3 (21:27):
Kathy Wilde, thank you so much.
Speaker 2 (21:28):
That's Kathy Wilde, President and CEO of the Partnership for
New York City.
Speaker 3 (21:33):
We thank you for your time.
Speaker 6 (21:34):
If you are listening to the Bloomberg Business Weekdaily podcast,
catch us live weekday afternoons from two to five pm Eastern.
Listen on Applecarplay and Android Auto with the Bloomberg Business app,
or watch us live on YouTube.
Speaker 3 (21:50):
All Right.
Speaker 2 (21:50):
Mark Dixon, founder and CEO of International Workplace Group is
joining us on Zoom from Monaco to talk about the
company's latest earnings and the global commercial real state market.
More broadly, IWG is a provider of flexible workplace solutions
think hybrid working coworking spaces. They have four thousand locations
across more than one hundred and twenty countries. Mark founded
(22:12):
his company, which was first called Rigas, in nineteen eighty nine,
and then they renamed International Workplace Group just a few
years ago. Let's talk about iwg's latest results. Mark, thank
you for joining us. What are the results tell us
about the current state of flexible workspaces?
Speaker 8 (22:31):
Well, it's a look at the results today really reflect
growing momentum in the marketplace. More and more companies looking
to become more capital like, become more agile, more flexible,
so high levels of growth. We've seen the best revenue
(22:51):
growth that we've seen in a number of years in
this quarter. So good momentum ending the year and very
strong outlook for twenty twenty six.
Speaker 3 (23:03):
Mark.
Speaker 9 (23:03):
This is Barry Ritolts. I'm curious as to what you're
seeing in terms of return to office, the decreasing need
for broad and widespread leases, and how are you guys
taking advantage of that demand for flexible workplace.
Speaker 8 (23:22):
Well, look, this is the idea of return to office
is an old story. It's companies are still using offices
in a big way. It's a key component of supporting
workers maximizing productivity. The only thing that's changed is those
(23:45):
offices that people are using, workers are using are in
more convenient locations, so they're not all in downtown locations.
They're distributed. More and more companies are seeking to support
their workforce on a platform of work in many places
rather than in one place. But look, the office hasn't
(24:06):
gone away, it's just moved. We are supporting nine million
customers today, a million of those actually work from home.
Eight million are working from offices. It's a growth market.
The way people are consuming companies are consuming real estate
is changing fundamentally.
Speaker 2 (24:28):
How are you supporting a company that works from home?
How does that relationship works.
Speaker 8 (24:35):
We supply a whole range of services for an individual
that works from home. It services, furniture, the ability, most importantly,
the ability to drop into an office whenever they need one,
and to get base all the services you would get
(24:56):
in it if you were in an office. You get
them supplied from either home one office you drop into.
It's a growing part of our business. More and more
workers are working from in particular those people that are
working in a sort of back office functions. You know,
(25:16):
the whole commutes really makes no sense for many people,
and you know that market continues to grow.
Speaker 9 (25:25):
So Mark, you put the international in iw G. Are
you seeing any different types of trends in various countries?
Is it the same in the US as it might
be in the UK or Italy or France.
Speaker 8 (25:42):
It's similar. The US is a sort of trend leader
in this space. I mean, US companies are much quicker
to sort of latch onto a trend that helps them
spend less money or make more money. They're very focused
on force productivity, I think more so as we end
(26:03):
twenty five than at any time in the past. They're
all focused also on capital lights. So US companies are
adopting more quickly, and that's large US corporations mediums that
the smaller companies have always done.
Speaker 2 (26:17):
This.
Speaker 8 (26:18):
The same is happening across the world, whether that's Japan,
whether that's continental Europe. Huge growth for US in places
like it countries like Italy or France. So it's not
limited to any one country. I mean, I think that
the catalyst for all of this is advances in technology.
(26:39):
It's the technology that is available today that makes a
different way of working possible. So companies are moving to
there's more distributed working method because it helps productivity, because
it lowers costs, and because it's what workers want.
Speaker 2 (27:02):
I have to ask about New York City specifically, because
our city is kind of on everyone's mind today with
the elections. What is your view of just the office
real estate market specifically in New York City. It's kind
of hard to get a read on it because there
are of course more people working from home. But then
of course you see JP Morgan building a massive new
(27:24):
skyscraper in the middle of Midtown Manhattan. What is your
take on just the outlook for New York City office
real estate.
Speaker 8 (27:33):
Look, it's highly nuanced. And this is you know, if
you look at work overall, it's about one point two
billion white collar workers in the world. To go one
point two billion, it is highly nuanced. Now, what works
for JP Morgan in you know, in midtown New hook
City is not the same for all companies. So this
(27:57):
what we're seeing. I mean, we have a very successful
businesses growing New York City. It's a real sort of
hotbed of growth for us. But people are working differently.
So where companies may have had one thousand people in
(28:18):
midtown or in downtown, they may have one hundred people now,
and those hundred people tend to be housed in better
quality space. So what's happening in New York City and
many cities worldwide, is that companies are having less space
in the sort of central business districts, but they want
(28:41):
better space because it has to be a place that
people want to come into. So there's a move to quality.
The market's vibrant. New York is better I think now
than any time I've seen it since twenty nineteen, and
it's picking up pace all the time. And but but
(29:02):
still the market has changed. I mean it's fundamentally different
in that there are problems with B and C grade
properties where you used to have a lot of let's
call it more back office functions or the you know,
the cheaper activities, those have moved.
Speaker 9 (29:25):
Mark, in the last thirty seconds we have you guys
are in over one hundred countries. What areas do you
see growth That might be a little bit surprising to listeners.
Speaker 8 (29:36):
Well, look at the market we like is Africa. It's
you know, huge population in Africa and growing population. So
you know countries like Egypt, I mean Egypt is the
Middle East and Africa significant growth. Middle East overall is
a vibrant market. There is a lot of companies move
(30:00):
moving there, a lot of companies growing there. So you
know the market is moving. It's it's sort of yes,
it's I usual is still a sort of powerhouse of
growth and manufacturing. Right, but Middle Eastern Africa.
Speaker 3 (30:14):
On Mark Dixon, we have to cut you off, Founder
and CEO of I w G. Thanks for joining us,
Stay with us.
Speaker 1 (30:20):
More from Bloomberg Business Week Daily coming up after this.
Speaker 4 (30:32):
Here get the.
Speaker 9 (30:37):
Dry.
Speaker 6 (30:38):
Do I look like I drive a mini van?
Speaker 3 (30:41):
Shut up and don't drive angry.
Speaker 6 (30:44):
Don't drive angry, I'll drive show.
Speaker 3 (30:54):
This is the drive to the clothes. If you had
access to a car like this, would you take it
back right away? On Blue Bloomberg Radio, This is Bloomberg BusinessWeek.
Speaker 2 (31:04):
I'm Emily Grafeo, cross asset reporter at Bloomberg News.
Speaker 3 (31:07):
Here with Barry Ridholtz. How you doing, Emily, I don't
know what what do I call you?
Speaker 2 (31:12):
Host of the Master's in Business podcasts, Sure Market, co.
Speaker 9 (31:15):
Founder, co founder of rid Holts Wealth Management. Just general
pain in the bug. That's I'm here to point out
all the things that we do wrong with money all
the time and remind people please make fewer errors when
it comes to managing your assets.
Speaker 2 (31:35):
You know that advice kind of thematically makes you know,
it reminds me of a Wall Street legend, an etf legend,
Jack Bogel. He was really, of course into just you know,
let's make the Vanguard website so hard to log into,
so that you never have to log in and check
(31:55):
your investments, so you never sell, and then you turn
eighty all of a sudden.
Speaker 9 (31:59):
Then you have the reason he was against ETFs, and
I have broken with Saint Jack over the years. He
thought it made it too easy for people to trade
right their assets, whereas mutual funds you have to pick
up a phone call somebody, you don't get a print
till the end of the day. That sort of thing.
If only we had an ETF expert here to talk
(32:23):
about these things with.
Speaker 3 (32:24):
Let's get to the drive to the clothes.
Speaker 2 (32:26):
We're here with Bloomberg News cross asset reporter Isabelle Lee
in the Bloomberg Interactive Broker studio talking about ETFs and
talking about new entrance into the thirteen trillion dollar ETF industry.
This year we have sixty new entrance So this is issuers.
These are our fund managers coming up one day and
(32:48):
saying I want to launch an ETF.
Speaker 10 (32:50):
Yes, So this and last year we saw sixty new entrants.
And if you look at pre pandemic like twenty twenty two,
today we've seen more ETF launches than the period going
back to nineteenninety three when the first ETF was launched
in Canada, mind you, because that's what Canadians always like
to remind us of the Americans that they launched the
first ETF. So this is just we always talk about
(33:11):
how there are new ETFs in the market, but I
think we forget sometimes to talk about the new players
because you think that I mean, sure, round Hill, Rex,
Vanguard and all those, they will keep launching, But the
new players is what's interesting. For instance, this year we
saw a man group that's the world's largest privately publicly
list at Hedge Fund. They launch an ETF PICTA that's
a European asset manager in Europe. They have around nine
(33:32):
hundred trillion dollars in nine hundred billion dollars.
Speaker 3 (33:34):
In assets and they launch an ETF.
Speaker 10 (33:36):
And then in the story we highlight a twenty five
year old lady x Jane Street x MIT who also
launch an ETF as a one woman band. And all
she had was a great idea, maybe three hundred thousand
also to really start it going. And now it's live.
It has around six million assets, which is decent. But
it just shows that almost everyone what certain level of
proficiency proficiency can launch an ETF.
Speaker 9 (33:57):
So I speaking earlier this year todave Not, he's president
of ETF dot Com, and he told me there's going
to be a thousand new ETFs issued this year. That's
a giant number. What he mentioned that was so surprising
was how many of these were active, Yes, and then
on addition to that, there are some that are leverage, directional, bets,
(34:21):
option based, just very exotic derivative strategies. What are you
seeing in ETF world? And are any of these thousand
new ETFs gonna stick?
Speaker 10 (34:31):
So that's exactly what Emily and I, we sit next
to each other, we always talk about how fee compression
actually is a story of yesterday, because now to stand
out in this wild West where thirteen drillion dollars nearly
dominate this base with more than four thousand, five hundred products,
it's really just just have this crazy idea that will
make people's jaw drop. So this year we saw the
filing off on five X ETF. That's leverage ETF to
(34:54):
the maximum five X. We've never seen that before.
Speaker 9 (34:56):
Well, that to the mask, because doesn't that mean the
following year we're going to get a ten X.
Speaker 10 (35:00):
I don't even know if the five X will be approved.
We don't even know if three X will be approved.
In Europe they have a couple of three X ETFs,
but non tracking single stocks all usually indexes, but this
year we've seen that in the US three X launches,
five X launches. So because we're seeing active ETFs, fees
are actually becoming higher.
Speaker 3 (35:16):
And Emily rode A sorry about that.
Speaker 10 (35:17):
And I think investors just don't care so much because
what they want is this sophisticated strategy wrapped in an
ETF where you can just click by because now technology
has made it so easy and it confetti will probably
pop up, and then you have that ETF.
Speaker 2 (35:30):
In an ironic twist, and I'm going to bring up
Bogel again, Bogel may not have wanted this, but you know,
by making passive ETF so cheap, basically you can get
the S and P five hundred and ETF for like
no money, it almost opens up a slice of your
portfolio to add a five percent allocation to an ETF
that's more expensive. So that's what we're seeing that a
(35:53):
lot of these issuers feel like they actually have the
runway to launch something that's maybe ninety basis points. Talk
about what this story that you wrote about this extrage
street person, you know, coming out and launching their own ETF.
They're only twenty five years old. What did it teach
you about what the barriers.
Speaker 3 (36:10):
To entry are to this market? The buyer's work.
Speaker 10 (36:13):
It's becoming lower because look, you need less than half
a million dollars and you can launch an ETF. But
the story doesn't end there because you have to keep
it running. And not only do you have to keep
it running, up to market it and get flows. And
this is a title. Actually they're a full stack, white
label platform. They said you need around sixty five thousand
to set up a fund, around two hundred and twenty
five thousand to really just keep it going with operating expenses.
(36:35):
But then you need a great idea and you need
to get people to give you capital. And we've seen
that while we've seen record launches, closures are also on
the uptick. We've seen one ETF closed for every five
that have launched. I mean, probably just the product of
a healthy ecosystem, but we're really seeing that it's becoming
harder to stand out to survive, which is why you
(36:57):
see more and more of these niche crazy filings. But
a lot of the folks really so for instance, this
twenty five year old Sophia Massey, she handed out the
day to day outsourcing custody to a network of specialist providers.
Speaker 9 (37:08):
And so you mentioned the marketing of this, and some
of the ETFs that caught my ie earlier earlier this
year are from very well regarded, very popular analysts, guys
like Dan Ives and Tom Lee. Both of those have
attracted billions with the b of dollars two hundred and
(37:31):
twenty five thousand to launch two hundred and twenty five
thousand to carry it. Sounds like you need one hundred
million or two hundred million. If you hit a billion,
that's a successful ETF, isn't it absolutely?
Speaker 10 (37:43):
First of all, it depends like Sophia, she wants one
hundred million, she says, and she'll be happy.
Speaker 3 (37:47):
Of course.
Speaker 10 (37:47):
I'm sure the bigger the better. But one billion is
a stunning success. Tom Lee and dan Ives achieved those
benchmark milestones.
Speaker 3 (37:54):
In less than a year.
Speaker 10 (37:55):
So it goes to show that, yes, it really is,
because in the beginning people were probably like, they're just
talking heads, maybe what do they know about it? But
their followers followed and piled cash. I think now tomly
has nearly four billion dollars. I think dan Ives just
recently hit around one billion. So those are really impressive.
Speaker 9 (38:12):
But both of those guys were early to AI, early
to in video, early to tech. They're in the hot
space and have been there for quite a while. Not
a surprise a doom that well.
Speaker 10 (38:23):
And not only do they get closed, but their performance
is also great like you're today. Both ETFs are up
thirty one percent for Ives, twenty percent for Granny. So
sometimes you see Kathy would she there was a time
she was getting inflows but then performance was down. And
there was the time performance was up but she wasn't
getting the inflows. But both these guys have it.
Speaker 1 (38:41):
Both the killing it.
Speaker 2 (38:42):
It really speaks to the strength of having a winning strategy.
Isabell Ye Bloomberg News cross ass or reporter on everything
that has to do with the thirteen trillion dollar ETF industry.
Speaker 3 (38:53):
Thank you for joining us.
Speaker 6 (38:55):
This is the Bloomberg Business Week Daily podcast, available on app, Spotify,
and anywhere else you get your podcasts. Listen live weekday
afternoons from two to five pm Eastern on Bloomberg dot Com,
the iHeartRadio app, tune In, and the Bloomberg Business App.
You can also watch us live every weekday on YouTube
(39:15):
and always on the Bloomberg terminal
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