Bloomberg Businessweek Weekend-June 27th, 2020

Featuring some of our favorite conversations of the week, from our daily radio show "Bloomberg Businessweek."

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Episode Transcript

Speaker 1 (00:02):
This is Bloomberg Business Week from Bloomberg Radio. Hi, I'm
Jason Kelly and I'm Carol Masser. Welcome to the weekend
edition of Bloomberg Business Week. Over the next couple of hours,
we're going to bring you some of the most important
highlights from our daily radio show this week. And Jason,
it was week fifteen. We welcomed officially the first day
of summer to kick off our week, and then once
again some very familiar themes weighing on the minds of

(00:24):
investors and on the stock market this week, the virus,
trade tensions, and we continue to talk with our guests
about racism in the United States, how to stop just
talking about it and to actually take action. Well, and
when you think of the people you want to hear from,
I dare say we had the top of the list
this week. Lebron James my conversation, it's the cover story

(00:46):
in this week's Business Week, how he and his longtime
business partner Maverick Carter have been managing a moment in
history like no other. We've always been in this position,
We've always strived that we've always had to plan for
this moment um is something that I've always Um had
a passion about and that's you know, letting people know,

(01:08):
having people to understand how important we are as um
Black America, you know, and the powers and the creativity
and the language and everything in the struggle that we've
had for so long. And for me to have the
brands that I have and having spring Hill and having
Uninterrupted and now today having a nonprofit organization and we

(01:30):
are more than a vote. It's allowing people to now
really sense what we've been striving to do from the
very beginning. So Um it's coming. You know. You always
talk about timing, and I guess, I guess the timing
is perfect for what we've always wanted people to understand
what we're all about as a company and as a
brand and as an individual. And Jason, We're gonna hear
a lot more from Lebron a little bit later on

(01:52):
in our broadcast. We'll also here from the president of
the Center for Talent Innovation, Lenia Irvin. She is someone
who has been such an advocate for diversity and inclusion,
spent a long time on Wall Street as well, so
another thoughtful chat with her. First up, Though we love
tom Orlick, He's got a new book out. He's the
chief economist for Bloomberg Economics and talk about timely. Oh

(02:15):
my god, so timely Jason, And as an excerpt of
that book in the magazine this week. His book it's
entitled China, The Bubble That Never Pops. I spent eleven
years in China, Carol. I moved there in two thousand
and seven. I left in the summer eighteen when the
trade war was heating up, and the sort of the
consistent consensus, the kind of the prevailing view amongst foreign

(02:39):
investors and economists and policymakers all that time was that, yes,
it's impressive, they've got double digit growth, that you just wait,
it's a bubble and it's going to implode. There's some
kind of China crash coming um. And of course that
crash never came. So the motivation of me is in

(03:00):
putting pen to paper and writing this book was really
to explore why why have we got it so wrong
on China? What are the reasons for resilience, and how
did that help us think about the future. So what
was the biggest surprise to you? Because I know there
are numerous answers, but what was the one? Where As
you dug into this time you thought, wow, I either

(03:22):
underestimated that as a reason or I just didn't think
of it. So I think one important thing Jason was
struck me as I was reading as I was writing
it is there are lots of things that we think
of as weaknesses in China which which actually strength UM
when you consider them in the Chinese context. So a

(03:44):
really important one is state control of the economy and
state control of the financial system. So of course here
in America, UM, we see the markets as a key
driver of dynamism UM. And for an advanced economy, which
is kind of push back the frontier, trying to innovate
that market driven dynamism is really critically important UM. But

(04:07):
that's not what China is trying to do. China is
not trying to push back the technology frontier. China is
trying to catch up. UM. And when you're trying to
catch up, having a plan to catch up, having a
bunch of businesses that will execute on that plan, a
bunch of banks that will lend money to help the
businesses execute on that plan can be really powerful and

(04:29):
really important. I think that's a really important point because
if you look at kind of the United States as
a comparison. We often talked Tom about the inability for
policy makers and you know, parties in power to actually
think really really longer term, you know, in terms of

(04:51):
things that need to be done in this country and
create programs that will have economic market, country payoffs, citizen payoffs.
But China can do do it right. They do those
tenure plans and they just set out and do it.
I mean, you know, not all the citizens may like
what's coming, but nonetheless it's a long term plan and
it creates dramatic changes in China. Yeah. I think that's

(05:13):
absolutely right, Carol, Um. I mean, I want to be
clear that I'm not advocating for the political system. I
don't think there's many people here in the States who'd
want to go to China to it to in to
Injro the how things play out in that respect over there, Um.
But in terms of economic planning, there's a really clear distinction.

(05:35):
I remember being over there, there was this one moment,
He's in my mind, there was this split screen moment
of inbo television. Um. And on one side we had
the US Congress, which was debating a bill to fund
the government for one more day. And on the other
screen we had Hijin Thing who was setting out of

(05:55):
vision for China's economy and it was just such a
stock contrast, right, I mean, can agree funding for a day,
planning for the next thirty forty years. And that's Bloomberg
Economics Chief economist Tom Orlick. Always loved catching up with
him and talk about a man on the news here.
I mean, this was a week where China it felt

(06:17):
like Carol came back to the four in multiple iterations,
some comments having to be walked back, and some real
concerns around the world, not just about the virus but
about trade. Right his book China The Bubble That Never
Pops and bottom Line Jason from him, he says, one
day there will be a day of reckoning for China.
It will have ripple effects across the world. You're listening

(06:38):
to Bloomberg Business Week coming up. It's been a big
week for the Bloomberg invest Global Conference and China was
front and center there as well, and a part of
my conversation with Blackstone Chairman and CEO Steve Schwartzman that's
coming up next. This is Bloomberg. This is Bloomberg Business Week,

(07:03):
with Carol Masser and Jason Kelly from Bloomberg Radio. Well,
today we're bringing you some of the most important, we hope,
informative conversations we had on our daily Bloomberg Business Week
radio show and beyond. We were all over the place,
Carol virtually, Oh my god. We were at the Bloomberg
invest Global Virtual Conference. As you said, Jason, this was
three days around the world talking to the most important

(07:25):
voices in the investment and financial community about what comes next. Well,
and one of the big names speaking was one of
the biggest in investing, talking about Steve Schwartzman, Blackstone Group
co founder, chairman and CEO. Check out what he had
to say. Well, this has been a pretty remarkable uh environment.
Imagine uh uh you know, sort of around the last

(07:50):
year end, if somebody told you that we were going
to have the voluntary closing of the world's economy, who
is certain except is to just keep food moving and
other things, you would say something like that couldn't happen,
and if it did, it would result in a global depression. Uh.

(08:12):
And it just wasn't on the page. Uh. And in
effect that those directions too almost every country to stop
your economy did occur, and unemployment has gone up massively,
but but we haven't had a depression. And the reason

(08:35):
for that is that we've learned from the past, and
you've had massive government intervention, massive transfers of trillions of
dollars of money to people who needed to in effect
replace the lost revenue from shutting our economies. And that
first big stimulus bill in the United States, UH, followed

(09:00):
by UH really very very large follow on by the
Central Bank in the United States. The FED is pumping
unprecedented peacetime moneys into economies, and in fact, the amount
of deposits and banks because money was transferred to people

(09:24):
has exploded. UH. And so we are awash with liquidity
that was necessary to give you some idea, US GDPs
around twenty one billion dollars to excuse me, trillion dollars
a year, and say, well, miss a quarter or more so,

(09:45):
so we're sort of missing six trillion coming in uh
and and somebody's got to fill that hole. And that's
what all these stimulus bills and the FED in effect,
you're doing in a very simple way. And so we've
had this dramatic collapse, stock markets down and now it's

(10:05):
bounced up as if nothing had occurred because of the
liquidity and support from the FED. And also so let
me ask you about that. So, So, Steve, if I may,
that specific point is one that I really feel like
I want to understand from your perspective, which is this
apparent disconnect with every headline that we're reading every day

(10:27):
related to virus cases going up, this medical crisis, this
health crisis that we're going through, and a stock market
if I even just look at my own four oh
one k that has rebounded. Is it just basically the
liquidity that's been pumped into the system. Help me understand
this gap. Yeah, I think it's mostly the liquidity that's

(10:49):
in the system, and also some elements of confidence. In
other words, you have a vaccines that are in the
process of development. The fact that will go oh for
one thirty really seems remote. There are three different types

(11:10):
of vaccines, uh and and and so I think people
are much more optimistic that that that's going to occur
on a timeframe that's way different, uh than the development
of vaccines was in the past, where the fastest one
was like four and a half years, and people are
have have have optimism that within the next nine months

(11:35):
will have enough positive could be a year outcomes from
trials that that you'll get there within a year to
start really producing large scale vaccine. And there's other therapeutic
breakthroughs that are occurring if you if you get the virus.

(11:56):
The second thing I'd say about these cases going up, uh,
how could one believe they wouldn't? Um, I don't find
that surprising. People have been locked up in their homes
for two to three months, and when you let them out,
there'll be more socialization. Uh And and people won't understand

(12:18):
truly that this can get them sick. Uh And once
they see that, and the appropriate government response will be
the first really warned people in democracies Apparently they like
to see bad things happen before people in democracies actually respond. Uh. So,

(12:41):
so I I completely expected this to happen. I think
the markets did as well. Uh And and that will
be put under better control because there's no option. Nobody
really wants to get sick. Uh And so you'll you'll
have change in behavior as as the number of cases
goes up, and eventually that will be beaten down. But

(13:04):
but I think it's it's you'll also see a big
V in terms of the economy going up for the
next few months because it's been closed and as people
are allowed to go back, the economy will really respond
a lot. But there's only so much the economy that's

(13:28):
highly complex can respond, uh, just because not all things
go up equally. Uh. And if it will take uh
quite a while before we sync up and get back
to levels. We've certainly been through a test. It's a

(13:50):
test for society. Uh. You know, I I still find
it astonishing that that that you managed to have the
vast majority of people around the world sort of going
to suspension for for two to three months, and so
there's going to be all kinds of changes. That's Steve Schwartzman, chairman,

(14:14):
CEO and co founder a Blackstone Group at the Bloomberg
Live Invest Global Virtual event. What I loved about what
he had to say, Jason and man, this was all
over the Bloomberg terminal. He predicts a big V in
terms of the economy going up for the next few
months because he says it's been closed. But there's a
lot of folks that say that's not going to happen. Well,
and the market didn't seem to agree with him for

(14:35):
much of the week, but it's hard to bet against
Steve Schwartzman. You're listening to Bloomberg b this week coming up,
as the world continues to reopen slowly and piecemeal, how
travel is rebounding from the unprecedented effects that the pandemic
has had. We'll hear from Kayak co founder Steve Haffner
talk about a front row seat. This is Bloomberg. This

(14:59):
is bloom Bird Business Week with Carol Masser and Jason
Kelly from Bloomberg Radio. We're bringing you some of the
most important and informative conversations that we have throughout the
week on our daily radio show. And Jason, of course,
all of this happening in real time as a lot
of news was changing again around us. Lin, Carol, we
know there's been some optimism, but a lot more pessimism

(15:19):
when it comes to travel. So who better to catch
up with than Kayak co founder and CEO Steve Hafner.
He's this week's Business Week Talks. We published data on
Kayak from about a billion consumer queries, and it's actually
showing you that there is some recovery in travel interest.
So the bottom period for for what we've seen in

(15:40):
our querry volume was happened in April seven when queries
fell year of a year, and since then they've been
gradually recovering. So yesterday, if you look at the data,
query volume was only down versus the previous year. So
there's a long way to go to be sure, but
consumers at least are thinking about flying again and they're
looking for trips. Tell us about you know, okay, so

(16:01):
some I mean percentage wise, can you give us an
idea because I know we keep talking about these numbers
and they're coming off of such significant loads. I mean
it's still way down, correct, It's still way down. So yeah,
last year there was twice as many people looking for
flights on kayak and there are uh this year as
of yesterday. But that's that's come up from down the

(16:22):
first week of April, so it is a recovery. And
remember this is search data, this isn't actually booking data.
So that just means that people are thinking about traveling again, right,
And I know that that is largely based on consumers.
Talk to us about corporate travel because I think we're
all trying to figure that out, not just again from
a personal perspective from our own work, but you know,

(16:42):
knowing and talking to a lot of other CEOs about
the decisions they're making in terms of, you know, maybe
we should video con, maybe we don't need to take
quite as many trips. What's your read on that? I
share those sentiments. You know you're talking to somebody used
to travel on a plane almost every day. Yeah, it's
been amazing boon to productivity not to have to do that.

(17:02):
And I think this pandemics, you know, one of the
few bright spots is it's taught people how to conduct
their affairs, uh somewhat efficiently online. So typically, in past
recessions and we're in one right now, business travel is
one of the last things to return because companies are
are really suffering, right So consumers still want to travel,
but consumers, but consumers may have may be able to

(17:25):
afford that in a way that the business um can't.
So typically business is the last thing recover. I think
it's gonna we're gonna see more the same now, and
it may never fully recover back to the levels that
that it once was because people have learned to adapt,
so we may never see twenty nineteen levels again. We're
preparing to see levels back in terms of total travel

(17:46):
demand by about three That's kind of how we've structured
our cost in our balance sheet. UM. But I think
how people are traveling and what they're thinking about and
how often they're going to travel are different. And that's
a big implications for how airlines do their schedules because
you've got to remember that the business traveler usually is
paying half the revenue on one of those flights. So

(18:08):
I think they will see the frequency of trips go down,
and I think you'll see average fares go up to
as business Talver is no longer subsidize, you know, the
consumers of leisure travel. So what about on the open
table side, what are you seeing in terms of restaurants.
We're seeing recovery and restaurants as well. So people want
to travel and they also want to dine out, and
we're seeing a stronger recovery on on the restaurant side
of the business half of you know, we've got about

(18:30):
sixty thousand restaurants UM on the Open table platform, about
half of them have reopened, which is great. And in
terms of seated diners, UM, we we capture that data
and we make it publicly available as well. Um that
was down only about yesterday, So so people are going
out and a seventy percent it sounds like a big reduction,
but you have to remember that because of COVID nine

(18:51):
team restrictions, most restaurants aren't operating at full capacity. A
lot of them are only outdoor only where they have
set up tents outside. Were even that they have to
have their table space six ft apart. So a lot
of them are you know, fifteen capacity, and you know
they're they're they're selling every seat they can and every
table they can, which is great news. It's not enough

(19:13):
to keep them in business, find you, but but it
does show that consumers want to get out of their houses.
And to that point, I mean, I believe you guys
had forecast and I think others have followed you in
this regard that we could see a quarter of restaurants
across the country go out of business. Does that still
feel about right or what are you guys thinking now?
That's still our best guests. Restaurants are tough business. They

(19:35):
go out of business all the time, as as you
well know. But usually what location goes under it's because
the concept was bad. What the management was bad and
a new restaurant takes his place. That's not what we're
expecting now. So when we talk about restaurants going out
of business, that means the location shutters permanently and becomes
something else. And you know, it all depends on what
happens with COVID nineteen and the restrictions, right, so can

(19:58):
we safely dine out again and indoors? Will employees come
back and start working in restaurants again versus collecting benefits
were doing other types of work? So you know, well,
we'll see what happens. But that's that's our prediction. And
that's Kayak co founder and CEO Steve Haffner also the
CEO of Open Tables, so he has a window in
and Carol, I think one of the things that we
really like, he's got the data. Oh my god, he does. Jason,

(20:21):
and it's this week's Business Week Talks. It's in the magazine,
it's in our podcast feed, it's online. What's interesting My takeaway.
He says how they're doubling down on some of their
business initiatives because of the impact of the virus. And
he talked about grocery stores, universities and bars soon being
able to use their apps. So definitely they are leveraging
their platform trying to adapt to a changing world, that's

(20:43):
for sure. You're listening to Bloomberg Business Week. Coming up,
how w W, the company formerly known his Weight Watchers
is pivoting amid our new world order. Our interview with
WW International CEO Andy Grossman coming up next. This is
Bloomberg Busines Bloomberg Business Week with Carol Messer and Jason

(21:04):
Kelly from Bloomberg Radio. Well, today we're being you something
the most important and we hope informative conversations we had
on our daily Bloomberg Business Week radio show. Carol, Yeah,
and one of those conversations, she's a friend of the show, Jason,
You and I both have spent a lot of time
talking with Mindy Grossman. She's a presidency of WW International,
used to be known as weight Watchers, but she has

(21:24):
been transforming that company thinking about wellness holistically. And I
got to say that they've been going through a tough
time because of the virus. They've had to cut costs,
they've had to let go workers, they've had to shut
down some of their outlets. We had a lot to
talk about with Mindy Grossman. We entered the year with
unbelievable momentum. You know, we had launched my WW We

(21:46):
were in the throes of our digital transformation. We did
a nine city tour with Oprah, touching you know, a
hundred and thirty five thousand people, and you know, then
all of a sudden in mid March, um the world
changed and we had to quickly pivot um not only

(22:06):
for the safety and security of our employees and our members,
but it was important to us that we kept our
community together because of our approximately five million members who
are all digital. Per cent of them also attended our
studios in March in six days, we had to train

(22:26):
fourteen thousand coaches. We pivoted our whole products and tech team,
and simultaneously, in twelve countries we launched virtual workshops, which
in the first week we had fifteen thousand and they're
still continuing today. And that pivot for us, even though
we saw suppressed subscriptions starting in you know, mid March,

(22:52):
that started really picking up again, uh, starting in mid April,
and you know, now our digital subscribers are at an
all time high, as is our retention. And it was
our maniacal focus on not losing our community in a
world where community and motivation and support are really more

(23:16):
important than ever, just even psychologically for people. We also
took the learnings from the tour we did physically with
Oprah and said, what can we do for people who
need this now more than ever? And we launched a
four weeks every Saturday virtual tour with Oprah and made

(23:39):
the decision to make it free globally for everyone because
it's really what people needed right now, and that's what
our brand has stood for since the very beginning. And
we had just in the first one over half a
million people live and we've now had millions of people

(23:59):
watched the content. UM. So what we've been trying to
do is use this as an opportunity to accelerate our
digital transformation, UM, reduce our real estate, bookprint, be able
to add, you know, to the ecosystem of wellness, and

(24:20):
you know, I think now we're seeing more than ever,
health and wellness is on top of everybody's mind. It's
not a luxury anymore, it's a necessity. Talk about Mindy
and I believe we've talked about this before. You mentioned
her a couple of times the Oprah effect here, I mean,
what has she done for the brand, especially in this

(24:40):
time it feels almost more important to have that voice
for a whole variety of reasons. She has been such
a partner to me since, you know, the day I
joined the company, certainly as a board member, but also
as a thought partner in how can we work together

(25:01):
to really give people the tools and the motivation so
they can really live their best, healthiest lives. So, you know,
if you look at what we've built out in terms
of this wellness ecosystem, whether it's nutrition or activity or mindset, motivation, sleep, relationships, whatever,
that is having Oprah and her voice to be able

(25:22):
to amplify. And it's really her superpower is to galvanize people.
And we really saw it on the tour, and we
also saw it on this virtual tour, and I know
she feels UM now more than ever. What we bring
um is going to be more critical for people. And
you know, as we talked about moving into the broader

(25:44):
scope of wellness, we said, we're never going to abdicate
our global leadership in healthy weight loss, which is so important.
If you look at the number one factor in COVID
deaths with obesity. UM. Diabetes is a huge fact, sir.
And we're seeing from all our data in terms of
why people are joining UM. And what is that? What

(26:08):
is top of mine? It's I need to be healthy,
not just for me, but healthy to others. I need
to not get sick to get healthy, I need to
prevent what is happening. And I think, you know, COVID
has really changed the mindset. The other thing it's done, though,

(26:29):
it's really identified the health disparities amongst communities, and I
think that going to be a big focus as well.
So maybe I gotta ask you because Carol and I
both know you pretty well. We've watched your career, and
I wonder you've managed through all sorts of crises before.
What's different about this one? From a leadership perspective and

(26:50):
and from the CEO seat. Yeah, you know, I thought
when I took my last company public in August two
thousand eight, that was kind of going to be the
biggest crisis I would have UM threw through. UM this
has been. This has been very different UM. Number one,
this is truly global UM. You know. Number two, there's

(27:13):
an aspect of uncertainty that we've never had before. UM,
you know number three, it has made us all isolate
in a very different way. UM. And all of those things,
you know, you have to take in from a leadership
uh perspective and right now and you know, not that

(27:35):
it wasn't then, but the need to a communicate. I'm
not just the CEO, I'm the chief communication officer, the
chief crisis officer, the chief hope officer. What people are
needing and feeling right now, UM, is they they want
to know, you know, where they stand, what is happening
at any given time. And you know, my feeling is

(27:58):
control what you can control, tell people what you're doing,
galvanize them around what you can do, UM, and and
keep that focus. And I'm very fortunate that you know,
our leadership team has really come together. I mean we've
we've built a culture of purpose and they're galvanized around

(28:19):
how what we can do. And I'm galvanized around what
we can do for them and for other I think
the other thing that's different this time is the world
has changed since then. And UM, authenticity is really important.
I say that. You know, people used to think vulnerability
was a weakness. It's a strength. UM. People want to

(28:41):
understand if they're feeling, you know, something that they're not alone.
And so the number of town halls and the number
of communications that myself and you know, our leadership team
has done has been significant, and we have tried to
be you know, transparent. We've tried to communicate whether that's

(29:03):
what's happening with the business, um, what's happening with you know,
our studios or our offices or everything around the world. UM.
And you know, I think that's that's that's been a
very big, big factor in this and and and lastly,
it's not just one thing. You know, we have a pandemic,

(29:23):
we have a financial um, you know challenge, and you know,
in the United States in particular, UM, you know, we
have a real issue in terms of racism. And you know,
what we are going to do as a country, and
what we're going to do is businesses. UM. So again,

(29:46):
it's all of these things happening at the same time
that really require um, you know, your ability or the
CEO's ability to address them in a very humane way.
And I think it's really a call to moral leadership
right now. And what does that moral leadership looks like
to you, especially around the racial justice issue. Indy. So

(30:09):
you know, for me, it's been devastating. You know, I've
been such a champion of diversity, uh my whole career
and it's it's been very emotional and uh, you know,
I'm very fortunate my c h r Oh kim Seymour
who who is a black woman, but she's been my

(30:29):
partner and the two of us um have really you know,
spent a lot of time saying, you know, how are
we gonna you know, manage and what are we going
to do? And we we had had and made progress,
um around diversity within our company. There's a reason we
have a diverse board that didn't happen by accident. There's

(30:50):
a reason we have a diverse executive team. But the
first thing we did was do a town hall UM
and said, look, we've made progress, but it's not enough,
and we need to do more and we need to
do it better. That's w W president and CEO, Mindy
Grossman and Jason. I feel like every time you and
I talked with her, we just want more and more time.
She continues to be one of those individuals that whatever

(31:11):
industry she is, she really is transforming it. And she's
definitely thinking about wellness in a very very different way,
in a holistic way. Well. And she's the first to
admit this time is hard, and this time is different.
She looks back to the financial crisis, taking a company
public in that but listen, trying to reshape and do
everything she's trying to do with that company just got
a whole lot harder in well. That wraps up the

(31:34):
first hour of the weekend edition of Bloomberg Business Week
from Bloomberg Radio. I'm Jason Kelly and I'm Carol mass
are plenty for you. In our next hour, we'll hear
from Lenia Irvin. She's a president of the Center for
Talent Innovation, spent a long time on Wall Street. She
too is on the front lines when it comes to
diversity and inclusion. So we'll have that conversation in just
a moment. And speaking of the front lines, we're also

(31:55):
going to hear from Lebron James. I'm looking forward to
the season getting restarted in back in the Laker uniform
um and continue to to push the envelope not only
on the court, but off the court. My conversation with
King James and the man behind the legend himself, his
longtime friend of business partner Maverick Carter. That's coming up
later on Jason. It's such a timely conversation. It is

(32:16):
this week's cover story. This is Bloomberg. This is Bloomberg
Business Week from Bloomberg Radio. Hi, I'm Carol Masser and
I'm Jason Kelly. Today we're bringing you some of the
most important, we hope in formative conversations we had on
our daily Bloomberg Business Week radio show. But this week
there's a little bit more. Carol, Oh my god, there's

(32:37):
so much more. And I have to say, Jason, this
is a story, an interview that you have been working
on for months. It's such a timely interview with Lebron James.
I feel like we don't need any adjectives in front
of him because everybody knows who he is. I have
not heard true official apology to Colin Kaepernick on what
he was going through and what he was trying to
tell the NFL and tell the world about why he

(33:00):
was kneeling when he was doing that as a San
Francisco forty Niner. So clearly King James has some opinions
about what's going on in the world. More of that
Bloomberg Business Week cover story. Conversation is ahead. First of
the Let's get to our conversation with someone who is
a recognized leader in diversity and inclusion. She spent a
decade on Wall Street. She took a job at the

(33:20):
Center for Talent Innovation in early March. She had a
lot to say about the virus and racism in the
United States. She is Lenia Irvin, president of the Center
for Talent Innovation. Conversations are are critical, right, um, opening
up safe space for real dialogue. UM. You know, it's
a great way to ensure that your employees steel heard,

(33:43):
you know, UM, ensure that they're seen. Um. But it's
also a really great opportunity for leaders and would be
allies to listen right the active in in UH their
leadership um, and and demonstrate from awareness of this moment
in time, the context in which we live disproportionate impact. Right.

(34:05):
I'm sure many leaders are. Of course they're considering UH,
COVID nineteen and unemployment rates and UH and obviously they
cannot unsee racism and police brutality. UM. But at the
same time, are they communicating, are they signaling to their
employee base at this is top of mind for them. Um,

(34:27):
you know, I think you know, I hosted a similar
conversation uh, you know within my organization a couple of
weeks ago. And you know, while on one hand, it
was tremendous vulnerability from a leadership standpoint to share my
experiences in the end after listening to uh, you know,
the team share, but on the other hand, it was

(34:48):
extremely powerful. Right. It's important for leaders to be visible,
to be vocal, And in this case, even if the
conversation was difficult, it offered up space for story telling,
it offered offered up meaningful bridging capital, and brought the
team closer together. And so I think conversation is a
good place to start, uh, you know, for for leaders

(35:09):
looking to connect with their employees at this time. Lennie.
The other thing, you know, and it's something Jason and
I've talked a lot about in particular over the past month. Um,
we had a conversation conversation with John opbrien of Operation
Hope and and what's interesting is he was talking with
younger a younger population, you know, about why people are
protesting and why does it get kind of sometimes you know,

(35:31):
out of control a little bit, And and they said
to him, you know, you have a seat at the table.
You get to go to the White House, you get
to talk to executives. We don't have a seat at
the table. You know, we're not in the room when
it all happens. And so it's and as he said
to us, this is a poverty issue. This is this
is you know, a much deeper entrenched problem in our situation,

(35:52):
in our system. What do you think we as all
leaders and who have voices, what can we do to
change that? How do we change that? Well? Right, well,
I mean, first admit that there is entrenched bias, right
that is that that creates barriers to UM success or
you know, access to meaningful work. But just you know

(36:13):
that admission alone is a great step. And then I think,
you know it's important for leaders to you know, be
intentional about what they can control, you know, whether that's
you know, hiring, development, promotion of key talent. UM. You know,
representation is and and visibility is really important. Our research

(36:33):
find um that you know, it's probably one of the
most important things we do have UM talent. Uh, some
talents frustrated with their advancement. One in five black professionals,
for example, UM feel that someone of their race could
never achieve a top position at their company. I mean
they can envision a reflection of their own image is

(36:56):
a C suite or a CEO? Right compared to uh
three sense as BLAE professionals right, and then professionals of
color you know as a whole are less likely to
have access to senior executive advocates. One fifth of black
employees and I would note of Asian professionals say that
not a single leader knows them by name. Imagine being
rendered invisible in connection to power and the long term

(37:19):
impact that could have on one's career. Right. So I
think one one thing that will help, um, uh you know,
organizations kind of bridge with with you know, emerging talent,
those that are coming up in these organizations and they
are um looking to eventually have a seat at the table.
Acknowledge that there is a disconnect, right, Um, there's a

(37:42):
there's a in are being black and corporate America research.
One really big finding was a perception gap um that
was unveiled in the data. Uh So black professionals, for example,
they witnessed, you know, they experienced serious to its advancement,
but they seem this seems largely invisible to their colleague.
So where six black professionals say yes, black talent has

(38:04):
to work much harder to advance, only six of their
colleagues agree with that statement. There's a material yet, there's
a material perception gap that makes overcoming the hurdle of
repension development advancement that much more difficult. And that's Lenia Irvian,
president of the Center for Talent Innovation, another very timely voice, Carol,

(38:25):
and I have to say one of the things that
struck me as I thought about our conversation with her
is it was pointed. You know that this was not
someone saying, well, we need to make some changes. Well,
let's see what we're gonna do. She was specific, and
I have to say pointed that I kept coming back
to that notion that it's time we got to do
something well and what I loved, and I feel like
I've been repeating it to everybody I talked to meet.

(38:48):
She said that leaders coming out making statements about diversity,
they first have to do the work internally at their
own organizations to earn the right to make those statements externally.
That to me says it all absolutely and echoes I
dare say of a conversation we're gonna hear later on
with Lebron James. You're listening to Bloomberg Business Week coming up.
As we all face increased levels of stress, you may

(39:09):
be thinking about getting a massage. Maybe what does the
future of the industry look like? We're gonna hear from
Todd Left, the CEO of handen Stone Massage. Oh my god,
if only he understands though so much about the world
of small business. This is Bloomberg Face is Bloomberg Business

(39:29):
Week with Carol Masser and Jason Kelly from Bloomberg Radio.
We're bringing you some of the most important and informative
conversations that we had throughout the week on our daily
radio show. A reminder, as we like to do, is
that there was a lot going on, as everybody knows
this week, the news constantly, Jason, evolving around us. That's
exactly right, and we know that the world has been

(39:50):
shifting for small businesses, franchise ors and franchise so it
was especially interesting to catch up with Todd Left. He's
the CEO of hand and Stone Massage. They have hundreds
of locations across the country. How they closed and how
they reopened. It's instructive for where we go. Next part
of our strategy was really, you know, how do you

(40:10):
preserve um the franchise e liquidity. That was that's one
of the most important things because we want them to
be around to reopen. And so one of one of
the things they had to do early on was, um,
you know, layoff all of the staff except generally managers
and so uh within a two week period, we uh,
the system laid off about eleven thousand employees. So it

(40:34):
was a you know, pretty big hit and um, you
know obviously to all those workers, you know, very unfortunate
as well. And so what's the process like of coming back,
I mean from a safety perspective, from a worker perspective,
walk us through the process of that. Yeah, so you know,
that was my biggest concern early on. I mean, you know,

(40:57):
when we sat there, you know, kind of mid March
and in late March, you really have to answer first
the existential question, as you said, Jay said, at the outset,
can you do a hands on business safely UM with
COVID nineteen, without a vaccine, without a really solid cure.
And so we didn't wait for you know, kind of

(41:18):
the government to dictate policy or determine it. We we
actually went out and engaged our own panel of health
experts that we had an infectious disease research or several
medical UH practitioners and then a medical director of a
massage school UM to really help us design the protocols
necessary up to you know, make sure that this process

(41:41):
could be done safely. And as we did the research
into this, you know, it actually ended up and everybody
learned so much over this course at the time that
that our services actually relatively low risk activity because generally
the disease was being transmitted through respiratory means, and so

(42:04):
we're really more skin to skin hands on. UM. It
didn't impact assuming everybody wore you know, had the proper
you know DP, it did not. It wasn't as risky
as maybe the perception would be as you sit there
from the outside. But we did we did have to
develop a lot of new safety protocols and and so

(42:26):
that we use that time wisely, you know, the month
we were closed to to develop those protocols and then
go retrain you know, ten thousand staff members on on
how to do this activity as they reopen. So two
questions I'm curious about what those safety protocols exactly. Will
it be like if I go in for a massage,

(42:46):
is it somebody that's kind of suited up in a
mask and they've got you know, um gloves on or something,
you know, some you know. I'm just curious how it
works out, and I am curious how many of your
workers are you ultimately going to be able to bring back.
So as of the first question, there are a number
of safety changes and you would see a different process
than if you had went in, you know, prior to

(43:08):
March First, we do require that all of the staff
members wear masks. Astheticians who these are the folks who
do the facial services, have to wear both masks and
face shields during the service UH customers. We are UH
certainly in most states, and we've worked with states in

(43:29):
developing these guidelines. In most states, customers are also required
to wear masks while they're getting the massage. If it's
not a state where it's required, then we we have
a high recommend and we allow the local jurisdiction to
set that up. We now disinfect the entire room after
each service, so in between any service, the room is

(43:51):
is disinfected. UM. We were fortunate that we had sinks
in all of our treatment rooms and so we require
hand washed by the massage therapists prior to the service.
Some stage they require the customer to hand wash prior
to getting the service. And then a lot of things

(44:11):
in the in just the transactional nature of it. UM
going to a contact light transaction, we really close down
a lot of the lobbies and we ask customers to
wait in the car and we text them so they
can walk right into the treatment room instead of sitting
in a lobby. So you would notice a number of changes.

(44:32):
I guess one of the things that strikes me is
all the stuff you're talking about cost money. So what
are the things you have to do operationally to ensure
for yourself, for your franchise ese that this business is
able to continue in this sort of new normal that

(44:52):
we're going to be in for some time. Right, Well,
I think that in the short term we you see
an increase in you know, our operational costs to meet
these new safety protocols and guidelines. But UM on the
the other side of it, obviously, UM demand has has
come back very strong. We are membership base as well.

(45:17):
Although we have you know, we also served non members
and guests, so a lot of our members over our
member base stayed with us and continued to actively pay
their membership fees during the time that we were closed.
And that's Todd left the CEO of Hand and Stone
Massage and Facial Spot. Important that we get that in

(45:38):
there too, Carol, because it's interesting when you think about
their lines of business, these are, to say the least
intimate interactions people. And I have to say I walked
in thinking, all right, well, this guy is just going
to talk about how everything's closed. Not the case. No, listen,
what's interesting is they said even in the shutdown, everything

(45:58):
was shut down by April for they still had their
members staying with them. And remember both of us were
talking about this afterwards. Of their comparable store sales, it
is back. So it's interesting to see how they are
finding their way back to reopening. Amazing. A very surprising conversation,
but also some very specific insights to to how you

(46:20):
do it and also how you think about it as
a small business. You're listening to Bloomberg Business Week coming up. Hospitals, Man,
they are counting beds again as coronavirus cases rise. We'll
here from Lloyd Minor, Dean of the Stanford University School
of Medicine, and David Entwistle, President and CEO of Stanford Healthcare.
Lots to look forward to. This is Bloomberg. This is

(46:50):
Bloomberg Business Week with Carol Masser and Jason Kelly from
Bloomberg Radio. Well, today we're bringing you some of the
most important and informative conversations We had a cross our
daily Bloomberg Business Week radio show this week. It was
a doozy to say the Lea's Carol, especially as we
saw all these headlines about the virus and one of

(47:10):
the most important things we have to understand is how
does this manifest in hospitals. That was really striking to me, Jason,
and you and I talked about it throughout the week
that when we checked the most read stories, it's one
of our favorite functions on the Bloomberg constantly. Now this week,
many of the top ten stories had to do in
some way with the virus. So it was a timely
conversation that we had with Lloyd Minor, Dean at Stanford

(47:32):
University School of Medicine and David Entwistle, President CEO of
Stanford Healthcare. They just opened a new facility late last year.
We are seeing an increase in the number of COVID
cases in many cities and locations across the United States,
and I think that indicates that we need to continue
to observe social distancing. The masking guidelines that have been

(47:54):
rolled out in many communities. There's good evidence that masking
helps to prevent the infection. It's gonna be, I think,
a location by location decision as to what additional measures
are put in place. That is, whether or not we
roll back from stage two where many places are today
to earlier stages. But the main thing is we've we've

(48:18):
got to be more prudent about UM as we resume activities,
as businesses, restaurants, uh department stores start to open. We've
got to observe social distancing. We've got to use mass
um and do things that less than the spread of
the infection. Well and David, largely because all of this

(48:39):
comes down to or so much of this comes down
to essentially hospital capacity. So help us understand from the
perspective of someone running a hospital what you worry about
with this spike, and what hospitals like yours are doing
and Obviously you're not facing at the moment any sort
of surge, But in your shoes or in the shoes

(49:00):
of others running hospitals, what are they thinking about. Well, no,
I appreciate that opportunity. One of the things that we
wanted to do, and certainly with any slowdown, which we
did as the initial pandemic came on, as we started
to see the numbers dip a bit, what we were
most concerned about then is getting some of the folks
back into the queue that actually needed some of the
delayed surgeries and other things that were going on. We

(49:22):
started with which I think is a bit of a model,
building on what deed Minor said, actually doing testing, so
making sure that the population that we had within the
hospital itself, our employees are physicians, uh, that we were
free of the virus. And we actually tested over twelve
thou employees and staff and saw less than a point

(49:43):
three percent of those staff actually had the virus. And
so we knew that we were creating a safe environment.
But I think it's important despite being able to be
there and be a resource for the community, we do
also have to have capacity. And one of the things
that we've done, despite opening back up doing our elective surgeries.
Uh is creating still a capacity within the organization that's

(50:05):
there and always available, because that really is the concern
is if we get another significant spike, well, we have
the capacity to be able to treat and we want
to make sure that we're ready for that this time
without having to shut everything down. Well, Dean Minor, you
know what have we learned? You know, here we are.
Jason and I have been working from home essentially. Jason
went into the office a little bit this week, but
he's back home. But here we are, and I think

(50:26):
week fourteen, week fifteen, Um, what have we learned from
the medical perspective about how to treat with the how
to treat the virus, how to stay ahead of it,
how to watch for either another spike? I mean, tell
us what we've learned? Thank you. I think we've learned
several things. First, is that this is a respiratory virus.

(50:47):
The principal mode of transmission is from one person to
the next through secretions through mucus through a cloth um
and and there may be other modes of transmission as well,
but the may danger is through direct contact with secretions
of someone who is infected and it is a highly

(51:07):
infectious virus. We've certainly improved our ability to treat people
who become ill in the hospital, our own hospital, Stanford
Hospital UH. We have been a pioneer in the studies
of RIM dissaver that has been shown to be effective
and in improving the recovery rate UH and and perhaps

(51:31):
also in lowering the risk of mortality from the virus.
We've been a part of those studies. We now have
studies going on in the outpatient setting using anti virals
at the time someone is diagnosed with the infection, before
they become severely ill, using anti virals in a clinical

(51:51):
trial setting in order to determine if there are therapies
we can give to outpatients that reduce the severity of
the disease and reduce the likelihood that people will need
to be admitted to the hospital. That's Lloyd Minor Dina
the Stanford University School of Medicine, along with David Entwistle,
Presidency E of Stanford Healthcare. Again, these are two individuals Jason,
you have seen so much when it comes to the virus,

(52:13):
both reminding us that this is still a very serious
infection in that you know reopenings are rolling them back,
which is something we talked about a lot throughout the week.
They need to be on a location by location basis
and bottom line, we still need to be more prudent
even as we reopen Absolutely got to look at the
data and got to look at hospitalizations, got to look
at this rising cases and figure out where to go next.

(52:35):
You're listening to Bloomberg this week coming up. We've been
looking forward to sharing this one with you all show long.
I've been looking forward to sharing it with you for months.
Lebron James and longtime business partner la Rick Carter. Perfect
for a weekend listening. This is Bloomberg. This is Bloomberg
Business Week with Carol Masser and Jason Kelly from Bloomberg Radio.

(52:57):
We're bringing you some of the most important and informative
convert stations that we had throughout the week on our
daily radio show. And I gotta say, one of the
best conversations Jason was one that you had this week. Well,
I appreciate that it was one that I was looking
forward to timely, to say the least. King James himself,
Lebron James, his longtime friend and business partner Maverick Carter.

(53:17):
I had talked with them in February. I caught up
with them again this week, all about their company, the
spring Hill Company, that they are launching, but more importantly
this moment and whether it will be more than that.
I think it's a special moment in the sense that, UM,
you can be heard active activism and activists have always

(53:39):
been around UM what people had a closed ear, in
a closed mind UM and didn't want to recognize and
didn't want to hear it, didn't want to be UM
knowledgeable about what they were speaking, where they were coming from,
the passions they were speaking with. UM. Now it's it's
being heard. People can be heard. Black Americans, African Americans,

(54:02):
you know, can be heard, both men and women can
be heard. UM. What they're passionate about and the calling
for help and the calling for we're being We're just tired.
So you know, I don't want to say activism is
something that's UM. You know, now everyone's doing it now,
It's always been around. But you know, in the in
the case of George Floyd, in the case of so

(54:22):
many other UM, innocent lives being taken away. UM, they've
put up a stand and and now you know, we're
being heard, and everyone is being heard. Um, not only um,
you know, from from what Muhammad Ali was saying and
so many that came before him and so many after him,
but even the local people, the people in the community,
because those are the real ones, the people that's in

(54:45):
the communities, that's living and walking those streets and being
racialistically profiled and being judged every day that they walk
in their cities. They're the ones that need to be heard,
and they're being heard right now, and it's it's great
to see. And so what does it feel like in Akron?
I mean, you talked about Los Angeles a little bit,
but you know, you and Maverick have said often that

(55:06):
so much of what animates you started in Akron. You
guys met when you were children, And I wonder how
this feels there Lebron. No, absolutely, Um. We always we
always recognize where home is a home base. It starts there,
you know, having my high primary school here and understanding
the um you know the level of importance with my

(55:28):
kids and you know when the pandemic, when when COVID started,
it was it was it was kind of heartbreaking because
I knew that my kids would have to leave the school.
We had to shut down our school for a period
of time, and I understand how important structure is and
hands on is with my kids and my school. So
you know, that was very troubling times for me and
troubling times for our facult team members and everyone that

(55:50):
had to do with the IPS, because you know, we're
so used to having our kids and we and we
know how important having them in the classroom and having
them underneath our our wing and our and our guidance. UM.
So we're always paying attention to our hometown and listening
to the people, listening to what's going on there. Um.
So that is constant every single day, no matter um.

(56:12):
You know, me and Maverick living in Los Angeles, we
we have hands on and and our ears to what's
going on in our hometown of Akron Oholla's with Maverick,
one of the things that you did during the pandemic
that was forced by the pandemic was graduated together. Tell
me why that was so important and what was different
about it and what it represented for spring Hill and

(56:34):
what it says about the opportunity. Yeah, obviously, the pandemic
unfortunately forced all of students back home, and and and
as Lebron said, unfortunately, the kids, the students that I
a school like, I promise the school is for a
lot of those kids the safest places where they get
the most structured because home is tough. And and and

(56:57):
especially for seniors, right high school seniors who did you
know get the chance to graduate and walk across the
stage and get the dipluma, which is a big moment
for all of us, and and and even a person
like me, it's the only graduation I've ever had, it's
the only graduation Lebron has ever had. So it's very
memorable and as an important moment in everyone's life. So

(57:18):
at the company, we got approached um by partners to
come along and produce graduate together and do it with
with Lorayn pal Jobs company, And it was just important
that we really over delivered for those students, for those kids,
it wasn't about us, It wasn't about the networks. Lebron

(57:38):
did the fantastic job hosting. We were fortunate enough to
have UH President Barack Obama deliver the commencement speech, But
it wasn't about Lebron. It wasn't about Obama, wasn't about
us as a company. It was about creating a special
memorable moment for those students, just like we all we
got the chance to do when we actually got to

(57:59):
experience it. Unfortunately they didn't. They had to do it
in their living rooms with their families. And that's what
made me very happy and proud as all the text
that I received from from families and parents who said
that was a special moment from my graduating senior and
now they at least have something they can remember it by,
and we did a T shirt. We wanted to make

(58:20):
it as special as possible and do it in the
Spring Hill Away, which is bringing to life as a
as a show on Network TV. We did an after
party on on Uninterrupted Instagram Live channel, and we brought
a product, so we wanted to really give them a
full three sixty moments so they felt very memorable and
something they could always remember, just as though they could

(58:41):
do it live and in person and Lebron We moved
from that to More Than a Vote that was launched
officially this week. What does success look like from More
Than a Vote as you look toward November, UM, I
think success looks like UM educating the people that's own
the grounds in these cities that we're tackling. UM. You know,

(59:05):
we've had voter suppression for so for so long, people
not understanding, UM, how they can vote, where they're where
they can vote, if their vote really counts. UM. You
know in the black community, you know you always here,
go out and vote. But what you don't understand is
who am I voting for? Where can I vote? How

(59:26):
many people am I voting for? What does these votes mean?
What do they stand for? UM? So the education side,
UM is what we're most proud about. That is success
for us where we're actually getting UM, these communities out
to vote, but they're even more educated on who they're
voting for, how they can vote, where they can vote. UM,

(59:47):
they have that power. UM. There's some there's a lot
of people that believe that they can't vote because they've
had previous convictions with the law or or or they've
been to jail and they've been told they cannot vote,
that their vote UM does not get submitted to things
of that nature, which is untrue. UM. In a lot
of states that we're tackling, So to educate and to

(01:00:10):
make aware of the people that's on the ground, that
has a lot to do with the future of our country. Um,
that is one of the success that we can have.
And we'll see what happens in November. And so Lebron
to that point, what can you do given your stature,
to ensure that this isn't fleeting? What are the things

(01:00:30):
that we need to be doing and thinking about? What
can you do to really take this forward in many ways?
What are you thinking about? Well, for me, my mission
doesn't change. Um, I've been doing this since day one,
you know. And Marverage just touched on a lot about
our brand and our company and what we've been doing.
But you know, even since I, you know, came out,

(01:00:51):
you know, from from high school to the NBA, you know,
instead of going with a company, I decided to hire
my friends. I decided to have hire my friends. Um
that I believe we can all grow together. We can
we can we can have shortcomings, we can have bumps
in the row, but at the end of the day,
if we stick with one another and we're true to
each other, and we can build this together. So I've

(01:01:12):
been doing this since day once, So my mission has
not changed at all. Continue to educate myself because the
more educated I am than the people around me will
get educated as well and continue to pass that down
to the youth. I mean, the youth is our future.
I mean we look at the class of this year,
the high school graduation, and there's nothing that they will
not be ready for after having a year like this,

(01:01:35):
you know. So for me to have the knowledge that
I have in the blueprints that I have to be
able to continue to pass it down to the generation
below me, to the generation that's with me, and continue
to understand how important um these times of every day is.
It's not being a leader is not when, it's not
about when you decide to do it, it's every single day.

(01:01:55):
And that's Lebron James Star of course, of the Los
Angeles Lakers, and maybe more important for this conversation, chairman
of the spring Hill Company. His business partner, the CEO
of that company, Maverick Carter. They've known each other since
they were kids, Carol. This is a special relationship and
where they are in the culture, where they are right now,

(01:02:16):
is incredibly, incredibly important. And what I think is really fascinating, Jason,
considering the backdrop of the last month that we've been
talking about diversity and racism in America, I feel like
this is a company for where we need to be today.
They kind of set the model well, and what you
just heard, it's just scratching the surface. For the full interview,
download the podcast. Just go to our podcast feed. You

(01:02:37):
can get the whole thing. And let me tell you,
it was wide ranging. We talked a lot about the
issues of the day. We talked a little bit about basketball,
but also to your point, Carol, where we go from here.
And I have to say it's a bit of a
bracing conversation at times because Maverick Carter especially talks about racism,
talks about what he has experienced, but also what it

(01:02:59):
means to ultimately enabled this system that we've all been
being a part of and hopefully what we can do
about it. I'm just gonna say it's a must read,
it's a must listen, and it's a must watch because
you can check out your TV special and your conversation
with both of them on Bloomberg TV. That wraps up
the weekend edition of Bloomberg Business Week from Bloomberg Radio.
Thanks so much for joining us. I'm Carol Masser and

(01:03:19):
I'm Jason Kelly. Be sure to tune into Bloomberg Business
Week Radio. Our show live Monday through Friday, starting at
two pm Wall Street Time. You can also watch the
show live on YouTube. Just search for Bloomberg Global News
and in addition to our daily podcast plus the Lebron
and Maverick interview, download our Business Week Extra podcast. This
week as well, we talk a lot about wellness, a
holistic approach to medicine. Our conversation with Dr vj vot

(01:03:43):
It was a fascinating one. He's a sports medicine specialist
and he works at the hospital for special surgery. But
he's thinking about medicine and treatment in the sort of
way that we need to be thinking. Talk about innovation
in medicine. He is certainly working on that. And I'm
just going to say that all the views that we
had uh in our weekend show, many of them. You
can find the full interview by checking out our podcast feed.

(01:04:06):
Have a great weekend, Stay safe. We'll be back next
week at the same time. This is Bloomberg