April 10, 2025 • 42 mins
Bloomberg’s Caroline Hyde and Ed Ludlow discuss the impact tariff uncertainty is having on tech stocks. Plus, Nancy Tengler of Laffer Tengler talks about what she is buying amid market weakness. And Jay Hatfield, CEO of Infrastructure Capital Advisors remains positive on the US economic outlook despite trade uncertainty.
See omnystudio.com/listener for privacy information.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:02):
Bloomberg Audio Studios, podcasts, radio news from the heart of
where innovation, money and power collide in Silicon Valley and beyond.
This is Bloomberg Technology with Caroline Hyde and Ed Ludlow.
Speaker 2 (00:35):
Live from New York and San Francisco. This is Bloomberg
Technology Investors. They are back on edge of the President
Trump's tariff pause and monster rally yesterday. And this is
tariff's on China remain in place. Markets now bracing for
a potentially protracted period of global trade volatility.
Speaker 3 (00:51):
Let's check in on these markets.
Speaker 2 (00:52):
We're currently up over the last two days almost eight percent.
Remember the euphoria that swept through the markets as tariff
are put on paus all countries except for China and
now have a ten percent blanket tariff. But we drop
again once again today, Ed, and it looks as though
the anxiety about what China really means the broader markets
is still there.
Speaker 4 (01:13):
Yeah, let's get some illustrative examples of the company's impacted.
Speaker 5 (01:16):
Right.
Speaker 4 (01:16):
Tesla jumps twenty two percent yesterday. This is a two
day chart. It's pulled back today, So it goes from
having its biggest jump since twenty thirteen to pulling back Apple,
another company impacted, right, switching up the boards and looking
in Apple ninety day pause on fifty six countries that
had tariffs implemented, while the administration boosts the tariff level
(01:39):
on China. Apple so interesting and later in the show
will dig deep into it. Why that Reuter's report that
they airlifted tons literally one point five million iPhones from
India into the US. This is kind of crazy markets
news cycle and I'm here.
Speaker 3 (01:54):
For it, aren't we?
Speaker 2 (01:55):
Just and President Trump's tariff pause is a welcome relief
ed but look, investors, our remaining warry of the wider
economic impacts. So there's one hundred and twenty five percent
tariff still on China. White House National Economic Council Director,
that's Kevin Hassett saying there have been well advanced trade
talks and offers with other nations.
Speaker 3 (02:13):
New Megs Caney lines.
Speaker 2 (02:14):
Breaks it down just the intricacy the ten percent blanket
tariff on everyone but China, but some get close to
a deal, it seems yeah.
Speaker 6 (02:24):
According to Kevin Hassett, who was speaking on another network,
he's the director of the National Economic Council, they've already
had more than fifteen deals presented to them, and they
are intending to take these bilaterally one by one. The
entire trade team, which could include Hassett, but as well
as Treasury Secretary Scott Besson and Commerce Secretary Howard Lutnick,
and of course President Trump himself, who admitted yesterday that
(02:44):
while this is about negotiation, it was also about the market.
Despite the messaging we initially got from the White House
Press Secretary and Secretary Bessent that this was always part
of the plan, this was the art of the deal.
It's all about negotiations. The President himself admitted he was
watching the bond market get a little queasy and felt
that people were getting Yippi, and that contributed to this
move at least to lower or to pause ninety day
(03:06):
four ninety days reciprocal tariffs on all countries except China.
But yes, that ten percent is still in place, and
that one hundred and twenty five percent levy on China
in place as well, in addition to the eighty four
percent reciprocal tariff that China has placed on US imports,
and that could effectively have the effect of starting a
decoupling of the two largest economies, which obviously has major
implications for firms with heavy Chinese exposure, including the technology
(03:29):
companies that we saw ripping yesterday. As you guys were
just talking about giving back some of those games today,
is there is still risk here for a company like
Apple in Nvidia. And although President Trump said yesterday he
does think China wants to make a deal, He's expecting
a phone call from Beijing and would love to talk
to Shijinping, there has been no sign from shir the
Chinese government yet that they are interested in making that
(03:49):
forward progress, suggesting that China does not necessarily want to
blink first here. Keeping in mind that the idea that
they're still ongoing conversations over a TikTok divestiture deal as
an additional piece of leverage and complication to any conversations
that are had.
Speaker 4 (04:03):
You know, Apple's going to be a big focus in
the show today because the White House keeps talking about it.
Yesterday's jump the biggest since nineteen ninety eight. It's this
crazy times, and India's a focus. I was interested in
our reporting that Bes listed India as one of the
nations he'd speak with early on What is the DC reaction?
Right If you're a Democrat and you're trying to respond
to the White House tariff policy, what are you hearing?
Speaker 6 (04:27):
Well, Essentially, what Democrats argue is that this is just chaotic,
that there is so much uncertainty around the policy, and
then that has the same detrimental impacts of these policies
staying in place. There was also a lot of concern
on the part of primarily Democrats yesterday about the potential
market manipulative effect of President Trump's swings when it comes
or vacillations when it comes to this policy. Keeping in
mind that it was yesterday morning he said on true
(04:49):
Social it was a good time to buy, then hours
later sparked the biggest rally we've seen since two thousand
and eight with this decision. In Many including Senator Adam
Schiff of California, have suggested that this requires an investigation
into possible insider trading. So that is another narrative we
are hearing. All of it though, just speaks to the
uncertainty around this policy. Keeping in mind that while the
President is now saying that China tariffs are sticking in place,
(05:12):
that there is a ninety day pause in place for
other countries. We have seen time and again that he
does have the power to change his mind to do
so very quickly. What stands today on Thursday isn't necessarily
going to stand tomorrow necessarily. And of course we're going
to have potentially multiple opportunities to hear from the President today.
He's scheduled to be holding a cabinet meeting right now.
Signing a bill later presents some opportunities for him to
(05:34):
speak to the press, and we'll see if he has
any additional surprising tariff news for US.
Speaker 4 (05:39):
For the most Kaylee Lines in Washington, d C. Thank you
very much. Another story. Over night, China also announced it
will quote moderately reduce the number of US movies allowed
into the country in response to the US government's tariffs.
The move is seen as a new front in the
trade war and could signal Beijing's willingness to target American services,
which could include travel, intellectual property royalties, and transportation care.
Speaker 2 (06:04):
Still so much to digest on the wider tariff implications
on tech.
Speaker 3 (06:08):
Let's get to it.
Speaker 2 (06:09):
Jay Hatfields with US Infrastructure Capital Management CEO.
Speaker 3 (06:13):
Can you trade in this erratic market?
Speaker 7 (06:17):
You can, but it's very easy to lose a lot
of money doing so. It's really better for most investors
to hold their positions, although I will say we have
been even before the tariff halt, we had said that
five thousand was a good support level. So now that
we've kind of bounced off that hard, I think we're
just neutral on equities right now. But I would counsel
(06:40):
even HEDGHOM managers to trade cautiously because there's erratic policy
coming out of the White House. They can announce it
at one ten in the afternoon, and so it's better
to just get to your position and kind of hold
it when.
Speaker 2 (06:56):
You're thinking about potentially the names that you've love and
want to recommit to. How much are you thinking about
exposure for China at the moment?
Speaker 7 (07:05):
One hundred percent, I guess, and also to overseas markets,
so we favor I think you had a guest on
earlier regional banks. They have no exposure to international They
do have credit exposure, but we think we have a
non consensus called economy is pretty strong, and so those
banks have come down almost as hard as the investment banks.
But they're not dependent on investment banking. They're really just
(07:27):
dependent on rates and spreads, So be more conservative in
this market.
Speaker 4 (07:33):
Jay, I'm just staring at a five day Nasdaq one
hundred chart, and I'm staring at it because effectively net
were flat over the course of five trading days. Then
you think about the drama that we're within those five
trading days. Do you net understand the tariff policy of
the White House and are you able to make informed
(07:56):
markets decisions based on your understanding of that policy?
Speaker 8 (08:01):
Thanks?
Speaker 7 (08:01):
Ed, definitely not. I mean that's really why we're neutral
on equities. We're actually pretty very constructive on inflation, which
that view is validated this morning. So we had negative
headline inflation. And just to mention that too, that everybody
wants to talk about terroffts, but nobody talks about the
twenty percent drop and energy. That's very profound, that's very
(08:24):
stimulative to the US economy. It's very positive for inflation,
but it never gets mentioned. But to your point about uncertainty,
there's basically two camps in the White House, the Hawks
and the doves. Doves are more pro business. You kind
of saw that when Elon Musk called Navarro a dumb
(08:45):
bag of bricks, like that's almost unprecedent. I don't think
that happens in normal organizations where colleagues are highly pejorative.
So because we don't really know who's gonna win that debates,
it seems like Bessent't has the Lakes victory. We are,
like I said, we're neutral on stocks, would be more conservative,
(09:06):
and also fixed income looks pretty attractive.
Speaker 4 (09:10):
Jay recession calls were pulled on the White House's ninety
day pause. Should our audience of technology investors, technology employees, founders,
startup leaders be braced for a recession in your mind?
Speaker 7 (09:24):
Our call is there's no recession but slow growth. But
the real thing that also people are missing in our
opinion is that the slowdowns mostly caused by hawkish Federal
reserve policy and not by tariff policy. As I mentioned,
energy decline pretty much offsets the tariff increase, So the
(09:45):
real issue is ultra tight FED policy. We think the
Fed has a flawed structure policy framework. They're very dangerous
and there potentially could create a recession. But we do
think the inflation data is going to be so positive
they'll be forced to cut rates later in the year.
Speaker 2 (10:04):
I'm really interested in that US economy positivity basically and
the fact that it means maybe we've got a resilient
consumer for Apple phones, maybe we've got a resilient consumer
for Amazon products. Are there any stocks in the tech
world that you think are worth adding to, not just
regional banks.
Speaker 7 (10:23):
Absolutely, and this doesn't sound conservative, but we think is
more conservative. Amazon. They're kind of half Walmart and their
price and sensitive. They're just passed through entity, and the
CEO is on this morning saying that AWS demand is
extremely strong, so they get traded like a tech stock,
(10:45):
but they're half for retail stock and they're cutting costs.
So that's, again, like regional banks, pretty defensive. In a
market that has been destabilized by this white house, they
can't really sort out who's in charge.
Speaker 2 (10:59):
And you've been putting out his investor and shareholder letter
today and responding to some of the well current volatility
than his consumers see. But then push us forward is
to what your view is on AI and if AWS
still sees insatiable demand. Many have been trying to work
out whether the AI bubble that has so inflated this
(11:20):
market is anyway intact?
Speaker 3 (11:21):
Is it?
Speaker 7 (11:22):
We think so everybody looks at the market and says, oh, well,
the stocks are way down, so AI must be falling apart,
they're just high beta stocks. They have two betas, so
they're twice as volatile as the market. So the market's
going down, what do you sell. You sell the volatile stuff,
you sell the investment banks, you sell tech stocks. This
doesn't mean the AI market has changed, and that's one
(11:42):
reason though, because we do believe there'll be continued AI spending,
and Jasse's comments certainly validate that. Really it's investment and
not consumption that drives recessions. So AI spending is offsetting
slow housing market and another thing that people haven't Folks
on have come down fifty basis points. It was disconcerting
(12:02):
yesterday when they were skyrocketing by the way. I thought
the market might crash then, But that is helpful. It's
not going to get the housing market to boom, but stabilize.
So if you look at investment, you can predict recessions
pretty well. Stabilizing housing strong tech spending that adds up
to slow growth. Say you know in that one to
(12:24):
two percent range.
Speaker 4 (12:27):
J our case study today I think is Apple and
in the short term they're airlifting iPhone handsets from India
into the United States. In the long term, the White
House sees a world in which the iPhone is assembled
in the United States. Do you see that future being
achievable for this White House?
Speaker 7 (12:46):
Not really. That's sort of the fundamental flaw of the
hawkish trade outlook is there's a notion that you can
have a trade balance with all countries, which is ridiculous
in the sense that low income countries have low labor,
they're going to be exporters. That's one way they grow.
(13:10):
And then the second thing is, if you run a
gigantic budget deficit, you have to have a trade deficit.
Financial flows need to equal physical flows. So the first
thing you need to do if you want to have
zero trade deficit is lower your budget deficit. So that
objective is ridiculous. It might have led to the bag
(13:30):
of bricks comment from Mosque not me, and so that's
why it's disconcerting to be in this market because one
side is arguably nutty and the other side is more
pro business, and we don't know who's going to win.
Speaker 2 (13:46):
Jay At the moment, it looks as of the House
is going to adopt a plan to advance Trump's tax
cuts and also the debt ceiling hike. I want to
get your take on how we can align what many
had thought would be a tax policy the offset some
of the volatility of tariffs. If the House can push
forward and agree one and a half trillion dollars in
cuts for the budget, is that the right policy right now?
Speaker 7 (14:07):
Absolutely? So that offsets the If we end up with
sort two percent of GDP, that's about a six hundred
billion dollar tax increase, So we need to offset that.
And in fact, that's what the flaw of the initial
strategy was, is that it just came too fast. You
could have just said, well, in a year, we'll do this,
and then you had plenty of time, and so they
(14:28):
came way before the tax cut, and that's what's destabilizing market.
And it's just an own goal if you play soccer,
because they didn't they they didn't need to do that.
It was just coming out of this Oh good, yeah good.
I tried that with one of your reporters and they're
like looked at me, like, what does that mean. I'm
the biggest soccer fan either, but I know what that is.
(14:49):
So that's the issue is that timing was horrible. They
could have gotten the exact same place by just saying
they're going to do this without doing it right away,
waiting for the tax cut, waiting for the FED to
figure out inflation's coming down. So it was just at
the absolute wrong moment. Also, it wasn't earning season. We
think earning scenes will calm people down, maybe not get
(15:10):
the market skyrocket, but when you hear from companies, their
stocks tend to rally because then you get certainty, even
if it's not great, like Delta's guidance was highly you know,
was bad actually, and stock this is before the announcement skyrocketed.
So we think any news or most news will be
viewed positively and the earning season will stabilize it. So
(15:32):
all this tariff news came into absolute terrible time during
a normally week March. So now not that we're super
bold up about the market, but we think it'll stabilize
kind of in this five to six thousand range. It's
not very stable five to six thousand, but be banging
around in that range. So we're neutral, not negative. We
(15:53):
were negative before this policy change.
Speaker 4 (15:56):
Jay Hofield of Infrastructure Capital Management, who I think was
quite Howard marks on the own goal analogy, thank you
very much. Now coming out with tariff threats actually helped
fuel TSMC's AI related growth surge at the start of
the year. We'll have more next. This is Bloomberg Technology.
Speaker 2 (16:23):
Quick check on the US listed shares of TSMC.
Speaker 3 (16:25):
Their ADRs.
Speaker 2 (16:26):
Look, they're going to be following the road and market
lower at the moment, off by four point eight percent
after they rallied hard yesterday. But we've got to keep
in mind that the company actually posted sales growth forty
two percent. On of course, AI demand are a head
of US tariffs. For more, let's bring in Peter Elstrom,
and what's interesting is the inventory build up is so
plain to see.
Speaker 3 (16:47):
This is the chip provider for Apple, for Nvidia.
Speaker 8 (16:50):
Right, we don't have all the numbers from TSMC yet.
All we've gotten is the revenue for this quarter. As
you say, though it's a forty two percent growth rate,
it's very very strong. They bumped up revenue to twenty
five point five billion dollars. So you've got one hundred
billion dollar run rate company that's growing at forty two percent.
It's pretty extraordinary. What we don't know what we'll find
out next week as they report more broadly their earnings,
(17:11):
we'll get more detail on that. We'll figure out how
much of this is inventory. As you say, there's probably
some stockpiling going on right here. To Their biggest customers
are Apple and Nvidia in particular, they may be accelerating
some of their purchases to get ahead of some of
these tariffs so that their customers don't have to pay
high tariffs as they get into the next few days.
Speaker 4 (17:33):
You know, the data is highly analogous with what we
saw from PC shipments right front running tariffs thing you
were coming that short term long term TSMC is pledged
billions of dollars to build chips in this country. Have
we learned anything more about that in its progress?
Speaker 8 (17:47):
Well, they didn't say anything at this point, but you're right.
They had previously pledged in sixty five billion dollars. More
recently they said they're going to add another one hundred
billion dollars onto that in US investments. They clearly want
to make chips in the US, partly to diversify themselves,
to geopolitically. Partly they'll be able to serve these customers
like Apple, like in Nvidia, like Tesla more effectively if
(18:09):
they're able to do it in the US, and they'll
avoid some of those tariffs if they're going to get
hit with US Now TSMC doesn't sell that many chips
directly into the US, but via Apple and via Nvidia
some of their other customers, they could get hit by
tariffs that go through their end products.
Speaker 4 (18:25):
Playboys.
Speaker 2 (18:26):
Peter Elstrom, thank you quick look at shares of Apple
falling after yesterday's massive rally. But there's also reports that
it shipped about one and a half million iPhones from
India to the United States in an effort to beat
President Trump's tariffs es. According to Reuter's ed, is fascinating
that six hundred tons worth from India. Who knows what
(18:46):
they were shipping on jumbo jets from China?
Speaker 4 (18:48):
Right right? I did the math. I checked the math.
Six hundred tons. The average weight of iPhone around seven ounces,
so with packaging, I think one point five million makes
sense that short term, long term, the only question is
can they build the iPhone outside of China and were
here in the United States? Who knows. Let's get more
on the fallout of US China tariffs and its impact
(19:08):
on Apple currently in a million acy president and prison
analyst that creative strategies joins US. I mean in a
world where the iPhone's built in America. There are many estimates.
Bank of America this week said it would be ninety
percent more expensive. That is an interesting scenario, Carolina.
Speaker 5 (19:26):
Is a very interesting scenario, one that I don't think
is going to happen anytime soon. I think that Apple
has other options before coming to the US. And that's
because unless we are moving part at least of a
supply chain to the US, is really unreasonable to think
that Apple can be successfully building iPhones here. So what
you're seeing with the shipment coming from India is that
(19:50):
Apple has the opportunity not just to ship, but to
actually rethink how and where they build iPhones that are
targeting the US market. So they could shift from China
to India or other manufacturing facilities to avoid some of
the harsher targets that China is faced with today. Obviously,
(20:13):
all of these can change tomorrow or this afternoon.
Speaker 2 (20:16):
What about, of course it can for the margin pressure.
How much will they suck up some of the margin pressure?
How much do you think they can pass on to
a pretty stress consumer here in the US right now?
Speaker 3 (20:27):
There's two aspects of it.
Speaker 5 (20:29):
One is to remember how strong Apple relationship with their
supplier manufacturer is and so there might be a negotiating
part there where it's not about just Apple passing on
to the consumer, but is Apple trading with their supply
chain to see how best everybody can ride this way.
(20:50):
Right at the end of the day, you want to
keep the Apple business with you for the longer time,
and then when it comes to consumer. I think it's
a very critical moment for Apple here in the US
market when it comes to services and Apple Intelligence in particular.
So they will want the upgrade cycle to continue, and
they might decide that it's worth sacrifice in some of
(21:12):
their margins in the short term to then have more
revenue coming from services and Apple Intelligence longer term.
Speaker 4 (21:18):
The story's hit the terminor just now clarifying that the
Trump tariffs on China now add up to one hundred
and forty five percent. You see Apple declines accelerating five percent,
and as that one hundred pushing even lower an airlift though,
have you ever seen that in your career? We just
have thirty seconds, Carolina.
Speaker 2 (21:35):
I had not.
Speaker 5 (21:36):
It's definitely something new, and I think it comes with
the volatility that we're in right now.
Speaker 2 (21:43):
Carolina Milanesi there with all the expertise and the context
president and print of Analystic Creative Strategies. Welcome back to
Bluemak Technology. I'm Karine Hyde in New York. Quick check
on these markets, d because we are accelerating our losses.
(22:04):
We're sub four percent on the last SAT one hundred
after a monster rally yesterday, the biggest gain sets two
thousand and eight.
Speaker 3 (22:10):
We fade some of that? Is it profit taking?
Speaker 2 (22:12):
Is it once again trying to understand what Chinese tariffs
that NAR are to the tune of one hundred and
forty five percent. What that means for the overall risk sentiment?
We're off by four percent on bitcoin, but hold of
ourve eighty thousand. Move on to the individual movers that
want to shine a light on because look, JD dot
Com up more than three and three quarters percent in
terms of ADRs traded here in the United States. China
looking to improve stimulus locally. That means e commerce players
(22:36):
that are domestic related and focused are going to be
doing well.
Speaker 3 (22:39):
But we are fading our rally and.
Speaker 2 (22:40):
Ali Baba, we're fading, of course even more on Apple
best rally since nineteen ninety eight. Yesterday, we're now off
by more than five percent, as those tariffs to China
impact that company, Amazon off by almost five percent, Andy
Jason looking strong into his investor and shareholder note, But
more broadly, we're worried about exposure there as well.
Speaker 4 (22:58):
Ed with you gone, well, let's get back to the
tariff story. President Trump's tariff on Chinese imports now total
at least one hundred and forty five percent. Bluebos Katie Lines,
who leads our political coverage for US in DC, is
actually going to come and do some math for me
because I've lost track on whether this includes reciprocals it doesn't,
and how we got to one hundred and forty five percent, Kayleie.
Speaker 6 (23:20):
Yeah, And this really is about math and how these
tariffs layer on top of each other, as there are
different tariff regimes that China is subject to. As President
Trump made clear yesterday in his post on True Social
he has raised the reciprocal tariff rate on China to
now one hundred and twenty five percent. That of course
has been escalated multiple times due to China's retaliation, but
that did not include the twenty percent tariff that he
(23:42):
had already put into place on Chinese goods earlier this
year over the trade of fentanyl. So it's about adding
that one to twenty five to that twenty percent that
was already existing, which gets us to the total rate
of one hundred and forty five percent. Now this was
actually all there in the White House's fine print, But
obviously it's difficult to understand with this fast moving story
how all of these tariffs work in tandem together. But
(24:03):
it does seem that this is a figure that was higher,
at least than the market previously understood it to be,
which is why we're seeing things take a turn.
Speaker 3 (24:10):
And this comes despite the fact that.
Speaker 6 (24:11):
President Trump in the Oval Office yesterday said that he
couldn't imagine taking tariffs on China any further than he
already had. But maybe perhaps this is further than was
previously understood. Keeping in mind that China has still an
eighty four percent retaliatory rate on US goods. It remains
to be seen whether or not they will escalate that
further and whether or not they are willing to pick
up the phone and talk to Donald Trump, as he
(24:32):
has suggested he is willing to talk to Shijinping wants
to make a deal, thinks China wants to make a deal,
but we have seen no sign of that yet.
Speaker 3 (24:39):
Is this trade war.
Speaker 6 (24:39):
Between the two largest economies only seems to be intensified.
Speaker 4 (24:44):
The us K lines at a DC chief mathematics correspondent.
I appreciate it, Thank you very much. Let's get back
to the market's reaction to tariffs, specifically the pools on
tariff's Like yesterday afternoon, Crazy Bloombo's Ryan for Selca, who
covers the tech sector, joins us Apple. I think, biggest
jump since ninety ninety eight. Test labings jumped since twenty thirteen.
The questions why, like why those levels of gains and
(25:07):
now the pool back this morning.
Speaker 9 (25:09):
Hey, thanks for having me on. So obviously yesterday was
a huge relief rally, and I'm sure there was some
short covering, some algorithmths, trading, all kinds of things just
feeding into the massive gain that we saw yesterday. But
I think once the dust settled a little bit, people
kind of realized, you know, hey, the terroristicainst China were raised,
there's still ten percent tariffs. Kind Of broadly, there's still
a lot of uncertainty, and I think just sort of
(25:31):
the pause in itself is just a sign of how
sort of erratic all the policies have been. There's been introductions, retaliations, escalations,
and now a pause, and it's it's very hard to
know what the next step is going to be, and
therefore it's very hard to know how to position or
understand what the economic outlook might look like.
Speaker 2 (25:50):
Right, Vasilica, with the ongoing uncertainty narrative, we appreciate it.
Let's try and get some certainty on what to do
with your portfolio now. Nancy Tangler, CEO and CIO of
Laffetanglo Investments, joins us now, and look, you've actually been
committed to adding certain names, Tesla being one of them.
Speaker 3 (26:05):
Why do that with the exposure to China?
Speaker 10 (26:07):
Yeah, well that's a great question. We were adding to
it since the market peaked because it got clobbered and
it was actually below current levels. But that is an
ongoing concern though. We're we own that stock for and
we talked about this after Cybercab we Robot Day in
southern California, but we own it for the energy business
and we own it as an AI play. So yes,
(26:30):
the evs matter, but I think it's analogous to Apple.
Speaker 3 (26:34):
What early days.
Speaker 10 (26:35):
When we were buying it twenty thirteen, twenty fourteen, the
iPhone was a means to the services business.
Speaker 2 (26:42):
Really interesting to bring broader context you can still hold
on to amid these day to day voluntile moves in
video or another one you've been adding to. Yes, many
have been quick to say exposure to China. However, some
analysts and coming out and I was saying, this is
one of our favorite picks. They're actually pretty protected from
the border impact.
Speaker 3 (27:01):
How are you looking at that name?
Speaker 10 (27:02):
Yeah, and we know that Jensen Wong met with the
President recently to try to get a carve out. We're
looking at that as part of what we think.
Speaker 11 (27:10):
You know.
Speaker 10 (27:10):
I was on the air on the day Deep Seat
came out, which was another k I seem to attract
it a chaos, that is.
Speaker 3 (27:17):
And what we thought was that.
Speaker 10 (27:19):
It would increase the use cases and the availability of
AI as an option, and we saw that in the
fourth quarter earnings, even though they're backward looking. We heard
from CEOs how broadly they're using it across sectors. And
you heard today Spotify saying we're not hiring anybody unless
you can prove that their job can't be done by AI,
(27:40):
so I think in Vidia is obviously the core of that.
Most of our investments have been on the software side.
We shifted to software about five six months ago, but
we still like that name. It's much smaller holding than
our major holding, Broadcom, which we've called the poor man's
in video, but we do like to add to it
on weakness and it gets these peer it has historically
(28:01):
just like Tesla. If you've owned Tesla since the IPO,
it's been in a bear market almost fifty percent of
the time. Yet it's up thousands of percent. So you
just have to pick your spots, be sure to trim
in these more volatile names when they run up, and
that's what we did last summer, and then we're adding
back in.
Speaker 4 (28:18):
Hello Nancy, It's always great to have you back on
the show. I don't think you attract chaos. I think
you just invest in the areas that attract chaos. It's different.
There's two names that you haven't discussed, and every time
you come on the show, I always so you haven't
discussed one in particular, which is meta, but also Amazon.
Caro brought up a really interesting point earlier, which is
(28:40):
you know Amazon has this duel mandate. It is a
technology stock and it is a retail stock depending on
how you look at it, like a Walmart or it's
a cloud provider.
Speaker 3 (28:50):
Tells me how you feel about them both.
Speaker 10 (28:52):
So Amazon was in our five for twenty five that
I published on twelve thirty one, and it's a member
of our twelve Best Ideas portfolio, and then we own
it in our strategy.
Speaker 3 (29:00):
So I love the name.
Speaker 10 (29:01):
I think it's a defensive technology name that you can
be adding to and here, and we have done that.
But I wrote my notes a couple days ago and
we've added to it since then. So I think it's
an important name to own our poster child for our
investing theme of old economy companies that have pivoted to
(29:22):
the new technologies as Walmart. You saw them confirm their
annual guidance. And then Andy Jasse came out today and
said what Jamie Diamond said. We're cutting costs. We're not
frantically cutting costs. We're going to our management teams and
saying where can we save money. That's a well managed company.
I think it's an all weather stock. Meta we sold,
as you know, and bought Spotify and so I was
(29:43):
beating myself up until I went and looked at the
relative performance since we've done that, and we've done much
better in Spotify, though, I think Meta is a name
you can easily own again and add to in this
weaker environment. That said, the AD revenue for Amazon is
objected to go down half as much as metas if
this all continues. So I think Amazon's the better player
(30:06):
from here, and that's where we've been putting our money
to work. And then Spotify and Netflix are names that
we think will hold up in kind of a low growth,
potentially recessionary environment. Though Goldman withdrew their recession forecasts, so
maybe we're just getting slow.
Speaker 4 (30:21):
Goth Nancy, how do you assess communication from policymakers over
the course of the last five days.
Speaker 10 (30:28):
It's been horrific ed. I just I've been at this
for over forty years. I have never seen a more
botched policy roll out than this, and I think it
did a lot of.
Speaker 3 (30:41):
Damage to the administration.
Speaker 10 (30:42):
I know yesterday, you know, we got the declaration that
this was intended all along, and you just don't understand
the art of the deal. And then Bill Lackman came
out and said, oh, This was executed perfectly by the president,
which makes me think he was selling yesterday into the strength.
Speaker 3 (30:57):
That's just speculation, but I think it's.
Speaker 10 (30:59):
Been horrible and you're seeing more and more of Scott
Bessett and Kevin Hassett, and I think that will benefit
the administration, though their message has been imperfect as well.
It makes no sense from an economic standpoint. Now ten
percent tariff would kind of act like a flat tax
and it would move, It would stop distorting behavior. But
right now, if you think about factory build you know,
(31:22):
we're up three last three years, it has exploded and
it continued into the first two months of this year.
We're now hearing new factories being put on hold. That's
what happens when you distort policy.
Speaker 3 (31:34):
How do your clients feel about it?
Speaker 2 (31:36):
How are they about remaining committed to funds exposed to equities.
Speaker 10 (31:40):
So we've spent a lot of time doing webinars with
our clients in since the market peaked in because there
was already you know, a sharp correction going on.
Speaker 2 (31:48):
Yeh, this whole deep seek was actually the mag seven problem,
not Maga, right, But do you agree with Besson?
Speaker 3 (31:54):
Oh? No, I thought that was also ridiculous.
Speaker 10 (31:56):
I'm sorry, I thought you're That was when it started though,
you know, the sort of franticness, But then we got
a rally.
Speaker 3 (32:02):
No, of course not. I think that's where.
Speaker 10 (32:05):
These guys are losing credibility because those of us that
do this for a living look at it and go, no,
that that's not in.
Speaker 3 (32:10):
Fact what it best't used to do it for a living.
Speaker 10 (32:13):
I know, isn't that interesting? Yeah, and took a very
hard stance on many issues.
Speaker 3 (32:17):
But no.
Speaker 10 (32:18):
But when you go to an administration, your job is
to be an advocate for the policy projected by the administration,
which is why I will never be in politics. But
our clients are pretty measured.
Speaker 3 (32:31):
You know.
Speaker 10 (32:31):
I got calls yesterday should I add more money? And
it was like, no, no, let's wait, this is not done.
But mostly we've seen flows in yeah, not mostly one
hundred percent.
Speaker 4 (32:42):
Yeah for tengler investments. Nancy teglis good to have you
back with us. Thank you very much. Coming up on
the show, Meta faces backlash from whistleblower testimony to Congress
and prepares to fight the FTC on antitrust allegations. Have
more on the social media giants battles next This is
Bloomberg Technology.
Speaker 3 (33:05):
Quick check on these markets.
Speaker 2 (33:06):
The losses are accelerating. We're off by more than four
percent across the S and P and the NASAT. We
wipe off about a third of yesterday's gains.
Speaker 3 (33:14):
The points drags, when.
Speaker 2 (33:15):
In fact there's only six or seven names in the
green on the Nasdaq one hundred. Everything else in the
red booking holdings is a key point drag ASML it's
a dr is a key point drag.
Speaker 3 (33:25):
But so too is meta.
Speaker 2 (33:27):
And let's just talk about meta and social media a
little bit more. Because the EU's governing rules on digital
platforms like X, like meta shouldn't be considered trade barriers
with the United States. That's all according to the EU
Digital Chief, Hennah for Kuna. Speaking with the Bloomberg's Oliver Kruk,
the Digital chief really outlined how the EU's rules affair
for everyone.
Speaker 3 (33:44):
Take a listen.
Speaker 11 (33:45):
These are same rules for everybody. So these are not
like trade rules. So when we speak about Digital Service Act,
Distell Market Acts or AI Act, we know that we
have same rules for other companies who are operating in
the European Union. So for the European companies and also
for Chinese, US and companies, so it's very fail for everybody,
and these are not creating trade barriers.
Speaker 12 (34:04):
And the digital services actually've been expecting some decisions specifically
on META and on X. Is there a delay that
due to the pressure being put by the Trump administration.
When can we expect progress on those?
Speaker 11 (34:15):
We have several investigations going on on the Digital Service
Acts and different investigations, and of course we are enforcing
the rules, respecting also the due process, so and always
when we are doing investigation from the Commission side, of course,
the main purpose is also that we want that the
online platforms that they are complying with our rules, and
(34:38):
often this is the case during the investigations that they
are also chasing their behavior and that is of course
what we want that they are respecting ours.
Speaker 12 (34:45):
So for example X, which is I think the most
advanced the investigation that you have, What would you like,
what is the endgame? What would you like X to
look like? How do you think is an appropriate way
for it to sort of shift.
Speaker 11 (34:55):
What we are saying in our rules. It's very much
that the online platforms they have to have the in
place that how they are assessing and mitigating the systematic risks.
They are posing for civic discourse, for electoral processes, for
people's well being, and also that they are transparent with
the access that the users know for example why certain
(35:15):
content is shown for them, and the users has to
have also choices how to change also the recommended system.
Speaker 12 (35:22):
I like to also get an idea of your sort
of channel of communication to these companies. Have you spoken,
for example, to Elon Marks, Have you spoken to Mark Zuckerberg?
Who have you spoken to the taxis and what are
those conversations like.
Speaker 11 (35:32):
Normally it's of course our commissions technical team who is
working with those platforms technical teams with their lawyers, and
that is all the time the dialogue we have going on.
So when we are enforcing the rules, it's not only
the investigations, so we have all the time several parts.
So we have all the time dialogue with online platforms,
especially of course it's done by our services. And then
(35:54):
also we have different code of conducts. We are preparing
different guidelines online platforms. They are also carrying their own
independent orders, so there's several bars all the time how
we are implementing and enforcing They're awesome.
Speaker 4 (36:08):
That was EU Digital Chief Hennavk and then speaking with
her own Oliver Kirk. Now META is facing congressional criticism
over its dealing with China following whistleblower testimony. Yesterday we
was Ridy Griffin back here with me and SF. The
principal accusation is that made by the whistleblower is that
META was briefing the Chinese communist parties early twenty fifteen.
(36:28):
But reading your story, it's more about the reaction and
fury of the lawmakers, if anything, no doubt.
Speaker 13 (36:34):
In fact, I think this congressional hearing ended up being
an opportunity for members of Congress on both sides of
the aisle, these senators to take aim at Mark Zuckerberg.
They called him inauthentic and disingenuous. Even Republicans were questioning
his magnification if you will, the comments he's made on
Joe Rogan, the famous podcaster, to suggest he is aligned
(36:57):
with Trump's agenda. So this proved to be a blasting
of Zuckerberg and one that we imagine will continue when
they say that they're going to call him to Congress.
Speaker 2 (37:09):
I mean he's also potentially going to be speaking because
of the.
Speaker 3 (37:13):
FTC investigation as well. This is not a great time.
Speaker 2 (37:17):
To have federal leaders seemingly not behind you, particularly when
they're going to be questioning the purchase of WhatsApp, the
purchase of Instagram, and potentially breaking this company apart.
Speaker 13 (37:28):
Yeah, beginning on Monday, we're going to see perhaps the
most existential threat to the company begin with the FTC trial.
So you've got the threat from regulators, lawmakers, and then
pressures internationally from Europe.
Speaker 3 (37:42):
As you had just posted in that.
Speaker 2 (37:44):
Video, Meta currently off by six point four percent on
the day, one of the worst points contributors to the downside.
Speaker 3 (37:51):
Ridie Griffin, thanks so much for keeping us up to speaking.
Speaker 4 (38:01):
It's time for talking tech and first up st Micro
announced plans to cut as many as twenty eight hundred
jobs over three years in an effort to increase efficiency
in automation. Though there was no mention of tariffs, the
semiconducting manufacturer says their latest cost cutting efforts will reshape
their manufacturing footprint and quote resized global cost base. Meanwhile,
(38:21):
the company's supervisory board has officially backed its CEO, Jean
Marc Schowi, just one day after the Italian government publicly
withdrew their support over top management. Plus, Amazon had equipped
some of its delivery vans in Europe with defibrillators to
help speed up aid to heart attack victims. Called Project Pulse,
(38:42):
the program involved over one hundred contract drivers who were
trained on the devices who would receive alerts from citizen
responder apps. Amazon concluded the program after several months and
is evaluating the feedback on future opportunities. And Tesla is
set to open a showroom in Saudi Arabia, the latest
sign that Elon Musk is putting behind a bitter feud
(39:03):
with one of the kingdom's most powerful men. The showroom's
expected to showcase its vehicle line lineup, alongside the CYBERCB
and Opsimus robot. Tesla's entry into Saudi Arabia marks a
sign of goodwill towards the Saudis and a potential growth
market for the company. Caroline and let's.
Speaker 2 (39:19):
Just return to Amazon because it also released its annual
letter to shareholders this morning.
Speaker 3 (39:24):
CEO Andy Jesse acknowledging they want to be.
Speaker 2 (39:27):
More like a startup, but also later discussed that sellers
could be passing on some tariff costs to customers for more.
Speaker 3 (39:33):
We're joined by Blue Most Tom Giles.
Speaker 2 (39:35):
Let's go to the letter first and foremost, because really
trying to show that AI demand is still there, and
also they're trying to be more agile with it.
Speaker 14 (39:41):
They want to be they want to be very like
a startup. They want to be firm, they want to
be agile. And what Amazon one of the sayings that
Amazon is always day one. It's always day Remember what
it's like when you are a new business, you're a
new company, You're just starting out and the world is
your oyster. And that's something that Jasse has worried about
(40:04):
Amazon employees losing over the last couple of years. That's
why he said they all have to come back after COVID,
after people were working from home. He said, come back
because people are losing that sense culture is extremely important Amazon,
and he definitely wants them to get that startup mentality
which is so important for these companies.
Speaker 4 (40:21):
I just tom want to quickly go to the conversation
Caroline had with Andy Jasse earlier in the year, because
it's all about CAPEX. Right, listen to this.
Speaker 2 (40:30):
You did say basically one hundred billion dollar run rate
for CAPEX expenditure. Can you give us even like a
percentage ratedown of how much that goes to distribution logistics
and how much goes to AI shares. You know, you
can tell you most of it, You know most of it.
You know the Lion's share is more than fifty percent?
Speaker 13 (40:46):
Yes?
Speaker 3 (40:46):
Is it more than eighty percent? We're playing the warmer
and colder, yes, exactly.
Speaker 4 (40:53):
No clues in the letter about CAPEX earnings isn't far away,
But I think this isn't the here and now what
people care about.
Speaker 14 (41:00):
Well, right now people are focused on tariffs right and
we're seeing that in the markets. We're seeing it with
the ways that stocks, including of Amazon, are getting whipsawed.
He hinted at that in an interview with another network,
talking about how, yeah, there's an expectation that some of
their sellers are going to pass prices tariffs onto their customers.
And look, they receive a lot of there's a lot
(41:22):
of inventory, there's a lot of products. There's a lot
of sellers who are China based or China affiliated, and
so if that tariff stays where it is, that is
absolutely going to affect Amazon's ability to compete with other
online sellers, especially if those sellers are able to diversify
their supply chain, get those products from somewhere else. A
(41:44):
lot of it is made in China, so a lot
of companies are going to be affected equally in many ways.
Amazon's is going to do what it can to keep
prices low, he said, but there's no way that those
prices will not be passed on in.
Speaker 2 (41:55):
Some way to end users, even as Greenberg reports and
yesterday showed that they've been trying to get that inventory,
been changing it up in response to all of this.
Tom Giles, who flew in on the Red Eye lanning
this morning.
Speaker 3 (42:08):
What a hero. We thank him for being here in
New York.
Speaker 2 (42:11):
Meanwhile, that does it for this edition of Bloomberg Technology.
Ed these marks whipsawing once again.
Speaker 4 (42:17):
Yeah, you put it right earlier. It's a third back
of what we gained yesterday. But there's still concern about Tariff's.
A ninety day pause sent markets to euphoria last night.
I think everyone's taken a bit of a breather. Come
back to us tomorrow on Bloomberg Technology. This is Bloombog
Technology
Bloomberg Audio Studios, podcasts, radio news from the heart of
where innovation, money and power collide in Silicon Valley and beyond.
This is Bloomberg Technology with Caroline Hyde and Ed Ludlow.
Speaker 2 (00:35):
Live from New York and San Francisco. This is Bloomberg
Technology Investors. They are back on edge of the President
Trump's tariff pause and monster rally yesterday. And this is
tariff's on China remain in place. Markets now bracing for
a potentially protracted period of global trade volatility.
Speaker 3 (00:51):
Let's check in on these markets.
Speaker 2 (00:52):
We're currently up over the last two days almost eight percent.
Remember the euphoria that swept through the markets as tariff
are put on paus all countries except for China and
now have a ten percent blanket tariff. But we drop
again once again today, Ed, and it looks as though
the anxiety about what China really means the broader markets
is still there.
Speaker 4 (01:13):
Yeah, let's get some illustrative examples of the company's impacted.
Speaker 5 (01:16):
Right.
Speaker 4 (01:16):
Tesla jumps twenty two percent yesterday. This is a two
day chart. It's pulled back today, So it goes from
having its biggest jump since twenty thirteen to pulling back Apple,
another company impacted, right, switching up the boards and looking
in Apple ninety day pause on fifty six countries that
had tariffs implemented, while the administration boosts the tariff level
(01:39):
on China. Apple so interesting and later in the show
will dig deep into it. Why that Reuter's report that
they airlifted tons literally one point five million iPhones from
India into the US. This is kind of crazy markets
news cycle and I'm here.
Speaker 3 (01:54):
For it, aren't we?
Speaker 2 (01:55):
Just and President Trump's tariff pause is a welcome relief
ed but look, investors, our remaining warry of the wider
economic impacts. So there's one hundred and twenty five percent
tariff still on China. White House National Economic Council Director,
that's Kevin Hassett saying there have been well advanced trade
talks and offers with other nations.
Speaker 3 (02:13):
New Megs Caney lines.
Speaker 2 (02:14):
Breaks it down just the intricacy the ten percent blanket
tariff on everyone but China, but some get close to
a deal, it seems yeah.
Speaker 6 (02:24):
According to Kevin Hassett, who was speaking on another network,
he's the director of the National Economic Council, they've already
had more than fifteen deals presented to them, and they
are intending to take these bilaterally one by one. The
entire trade team, which could include Hassett, but as well
as Treasury Secretary Scott Besson and Commerce Secretary Howard Lutnick,
and of course President Trump himself, who admitted yesterday that
(02:44):
while this is about negotiation, it was also about the market.
Despite the messaging we initially got from the White House
Press Secretary and Secretary Bessent that this was always part
of the plan, this was the art of the deal.
It's all about negotiations. The President himself admitted he was
watching the bond market get a little queasy and felt
that people were getting Yippi, and that contributed to this
move at least to lower or to pause ninety day
(03:06):
four ninety days reciprocal tariffs on all countries except China.
But yes, that ten percent is still in place, and
that one hundred and twenty five percent levy on China
in place as well, in addition to the eighty four
percent reciprocal tariff that China has placed on US imports,
and that could effectively have the effect of starting a
decoupling of the two largest economies, which obviously has major
implications for firms with heavy Chinese exposure, including the technology
(03:29):
companies that we saw ripping yesterday. As you guys were
just talking about giving back some of those games today,
is there is still risk here for a company like
Apple in Nvidia. And although President Trump said yesterday he
does think China wants to make a deal, He's expecting
a phone call from Beijing and would love to talk
to Shijinping, there has been no sign from shir the
Chinese government yet that they are interested in making that
(03:49):
forward progress, suggesting that China does not necessarily want to
blink first here. Keeping in mind that the idea that
they're still ongoing conversations over a TikTok divestiture deal as
an additional piece of leverage and complication to any conversations
that are had.
Speaker 4 (04:03):
You know, Apple's going to be a big focus in
the show today because the White House keeps talking about it.
Yesterday's jump the biggest since nineteen ninety eight. It's this
crazy times, and India's a focus. I was interested in
our reporting that Bes listed India as one of the
nations he'd speak with early on What is the DC reaction?
Right If you're a Democrat and you're trying to respond
to the White House tariff policy, what are you hearing?
Speaker 6 (04:27):
Well, Essentially, what Democrats argue is that this is just chaotic,
that there is so much uncertainty around the policy, and
then that has the same detrimental impacts of these policies
staying in place. There was also a lot of concern
on the part of primarily Democrats yesterday about the potential
market manipulative effect of President Trump's swings when it comes
or vacillations when it comes to this policy. Keeping in
mind that it was yesterday morning he said on true
(04:49):
Social it was a good time to buy, then hours
later sparked the biggest rally we've seen since two thousand
and eight with this decision. In Many including Senator Adam
Schiff of California, have suggested that this requires an investigation
into possible insider trading. So that is another narrative we
are hearing. All of it though, just speaks to the
uncertainty around this policy. Keeping in mind that while the
President is now saying that China tariffs are sticking in place,
(05:12):
that there is a ninety day pause in place for
other countries. We have seen time and again that he
does have the power to change his mind to do
so very quickly. What stands today on Thursday isn't necessarily
going to stand tomorrow necessarily. And of course we're going
to have potentially multiple opportunities to hear from the President today.
He's scheduled to be holding a cabinet meeting right now.
Signing a bill later presents some opportunities for him to
(05:34):
speak to the press, and we'll see if he has
any additional surprising tariff news for US.
Speaker 4 (05:39):
For the most Kaylee Lines in Washington, d C. Thank you
very much. Another story. Over night, China also announced it
will quote moderately reduce the number of US movies allowed
into the country in response to the US government's tariffs.
The move is seen as a new front in the
trade war and could signal Beijing's willingness to target American services,
which could include travel, intellectual property royalties, and transportation care.
Speaker 2 (06:04):
Still so much to digest on the wider tariff implications
on tech.
Speaker 3 (06:08):
Let's get to it.
Speaker 2 (06:09):
Jay Hatfields with US Infrastructure Capital Management CEO.
Speaker 3 (06:13):
Can you trade in this erratic market?
Speaker 7 (06:17):
You can, but it's very easy to lose a lot
of money doing so. It's really better for most investors
to hold their positions, although I will say we have
been even before the tariff halt, we had said that
five thousand was a good support level. So now that
we've kind of bounced off that hard, I think we're
just neutral on equities right now. But I would counsel
(06:40):
even HEDGHOM managers to trade cautiously because there's erratic policy
coming out of the White House. They can announce it
at one ten in the afternoon, and so it's better
to just get to your position and kind of hold
it when.
Speaker 2 (06:56):
You're thinking about potentially the names that you've love and
want to recommit to. How much are you thinking about
exposure for China at the moment?
Speaker 7 (07:05):
One hundred percent, I guess, and also to overseas markets,
so we favor I think you had a guest on
earlier regional banks. They have no exposure to international They
do have credit exposure, but we think we have a
non consensus called economy is pretty strong, and so those
banks have come down almost as hard as the investment banks.
But they're not dependent on investment banking. They're really just
(07:27):
dependent on rates and spreads, So be more conservative in
this market.
Speaker 4 (07:33):
Jay, I'm just staring at a five day Nasdaq one
hundred chart, and I'm staring at it because effectively net
were flat over the course of five trading days. Then
you think about the drama that we're within those five
trading days. Do you net understand the tariff policy of
the White House and are you able to make informed
(07:56):
markets decisions based on your understanding of that policy?
Speaker 8 (08:01):
Thanks?
Speaker 7 (08:01):
Ed, definitely not. I mean that's really why we're neutral
on equities. We're actually pretty very constructive on inflation, which
that view is validated this morning. So we had negative
headline inflation. And just to mention that too, that everybody
wants to talk about terroffts, but nobody talks about the
twenty percent drop and energy. That's very profound, that's very
(08:24):
stimulative to the US economy. It's very positive for inflation,
but it never gets mentioned. But to your point about uncertainty,
there's basically two camps in the White House, the Hawks
and the doves. Doves are more pro business. You kind
of saw that when Elon Musk called Navarro a dumb
(08:45):
bag of bricks, like that's almost unprecedent. I don't think
that happens in normal organizations where colleagues are highly pejorative.
So because we don't really know who's gonna win that debates,
it seems like Bessent't has the Lakes victory. We are,
like I said, we're neutral on stocks, would be more conservative,
(09:06):
and also fixed income looks pretty attractive.
Speaker 4 (09:10):
Jay recession calls were pulled on the White House's ninety
day pause. Should our audience of technology investors, technology employees, founders,
startup leaders be braced for a recession in your mind?
Speaker 7 (09:24):
Our call is there's no recession but slow growth. But
the real thing that also people are missing in our
opinion is that the slowdowns mostly caused by hawkish Federal
reserve policy and not by tariff policy. As I mentioned,
energy decline pretty much offsets the tariff increase, So the
(09:45):
real issue is ultra tight FED policy. We think the
Fed has a flawed structure policy framework. They're very dangerous
and there potentially could create a recession. But we do
think the inflation data is going to be so positive
they'll be forced to cut rates later in the year.
Speaker 2 (10:04):
I'm really interested in that US economy positivity basically and
the fact that it means maybe we've got a resilient
consumer for Apple phones, maybe we've got a resilient consumer
for Amazon products. Are there any stocks in the tech
world that you think are worth adding to, not just
regional banks.
Speaker 7 (10:23):
Absolutely, and this doesn't sound conservative, but we think is
more conservative. Amazon. They're kind of half Walmart and their
price and sensitive. They're just passed through entity, and the
CEO is on this morning saying that AWS demand is
extremely strong, so they get traded like a tech stock,
(10:45):
but they're half for retail stock and they're cutting costs.
So that's, again, like regional banks, pretty defensive. In a
market that has been destabilized by this white house, they
can't really sort out who's in charge.
Speaker 2 (10:59):
And you've been putting out his investor and shareholder letter
today and responding to some of the well current volatility
than his consumers see. But then push us forward is
to what your view is on AI and if AWS
still sees insatiable demand. Many have been trying to work
out whether the AI bubble that has so inflated this
(11:20):
market is anyway intact?
Speaker 3 (11:21):
Is it?
Speaker 7 (11:22):
We think so everybody looks at the market and says, oh, well,
the stocks are way down, so AI must be falling apart,
they're just high beta stocks. They have two betas, so
they're twice as volatile as the market. So the market's
going down, what do you sell. You sell the volatile stuff,
you sell the investment banks, you sell tech stocks. This
doesn't mean the AI market has changed, and that's one
(11:42):
reason though, because we do believe there'll be continued AI spending,
and Jasse's comments certainly validate that. Really it's investment and
not consumption that drives recessions. So AI spending is offsetting
slow housing market and another thing that people haven't Folks
on have come down fifty basis points. It was disconcerting
(12:02):
yesterday when they were skyrocketing by the way. I thought
the market might crash then, But that is helpful. It's
not going to get the housing market to boom, but stabilize.
So if you look at investment, you can predict recessions
pretty well. Stabilizing housing strong tech spending that adds up
to slow growth. Say you know in that one to
(12:24):
two percent range.
Speaker 4 (12:27):
J our case study today I think is Apple and
in the short term they're airlifting iPhone handsets from India
into the United States. In the long term, the White
House sees a world in which the iPhone is assembled
in the United States. Do you see that future being
achievable for this White House?
Speaker 7 (12:46):
Not really. That's sort of the fundamental flaw of the
hawkish trade outlook is there's a notion that you can
have a trade balance with all countries, which is ridiculous
in the sense that low income countries have low labor,
they're going to be exporters. That's one way they grow.
(13:10):
And then the second thing is, if you run a
gigantic budget deficit, you have to have a trade deficit.
Financial flows need to equal physical flows. So the first
thing you need to do if you want to have
zero trade deficit is lower your budget deficit. So that
objective is ridiculous. It might have led to the bag
(13:30):
of bricks comment from Mosque not me, and so that's
why it's disconcerting to be in this market because one
side is arguably nutty and the other side is more
pro business, and we don't know who's going to win.
Speaker 2 (13:46):
Jay At the moment, it looks as of the House
is going to adopt a plan to advance Trump's tax
cuts and also the debt ceiling hike. I want to
get your take on how we can align what many
had thought would be a tax policy the offset some
of the volatility of tariffs. If the House can push
forward and agree one and a half trillion dollars in
cuts for the budget, is that the right policy right now?
Speaker 7 (14:07):
Absolutely? So that offsets the If we end up with
sort two percent of GDP, that's about a six hundred
billion dollar tax increase, So we need to offset that.
And in fact, that's what the flaw of the initial
strategy was, is that it just came too fast. You
could have just said, well, in a year, we'll do this,
and then you had plenty of time, and so they
(14:28):
came way before the tax cut, and that's what's destabilizing market.
And it's just an own goal if you play soccer,
because they didn't they they didn't need to do that.
It was just coming out of this Oh good, yeah good.
I tried that with one of your reporters and they're
like looked at me, like, what does that mean. I'm
the biggest soccer fan either, but I know what that is.
(14:49):
So that's the issue is that timing was horrible. They
could have gotten the exact same place by just saying
they're going to do this without doing it right away,
waiting for the tax cut, waiting for the FED to
figure out inflation's coming down. So it was just at
the absolute wrong moment. Also, it wasn't earning season. We
think earning scenes will calm people down, maybe not get
(15:10):
the market skyrocket, but when you hear from companies, their
stocks tend to rally because then you get certainty, even
if it's not great, like Delta's guidance was highly you know,
was bad actually, and stock this is before the announcement skyrocketed.
So we think any news or most news will be
viewed positively and the earning season will stabilize it. So
(15:32):
all this tariff news came into absolute terrible time during
a normally week March. So now not that we're super
bold up about the market, but we think it'll stabilize
kind of in this five to six thousand range. It's
not very stable five to six thousand, but be banging
around in that range. So we're neutral, not negative. We
(15:53):
were negative before this policy change.
Speaker 4 (15:56):
Jay Hofield of Infrastructure Capital Management, who I think was
quite Howard marks on the own goal analogy, thank you
very much. Now coming out with tariff threats actually helped
fuel TSMC's AI related growth surge at the start of
the year. We'll have more next. This is Bloomberg Technology.
Speaker 2 (16:23):
Quick check on the US listed shares of TSMC.
Speaker 3 (16:25):
Their ADRs.
Speaker 2 (16:26):
Look, they're going to be following the road and market
lower at the moment, off by four point eight percent
after they rallied hard yesterday. But we've got to keep
in mind that the company actually posted sales growth forty
two percent. On of course, AI demand are a head
of US tariffs. For more, let's bring in Peter Elstrom,
and what's interesting is the inventory build up is so
plain to see.
Speaker 3 (16:47):
This is the chip provider for Apple, for Nvidia.
Speaker 8 (16:50):
Right, we don't have all the numbers from TSMC yet.
All we've gotten is the revenue for this quarter. As
you say, though it's a forty two percent growth rate,
it's very very strong. They bumped up revenue to twenty
five point five billion dollars. So you've got one hundred
billion dollar run rate company that's growing at forty two percent.
It's pretty extraordinary. What we don't know what we'll find
out next week as they report more broadly their earnings,
(17:11):
we'll get more detail on that. We'll figure out how
much of this is inventory. As you say, there's probably
some stockpiling going on right here. To Their biggest customers
are Apple and Nvidia in particular, they may be accelerating
some of their purchases to get ahead of some of
these tariffs so that their customers don't have to pay
high tariffs as they get into the next few days.
Speaker 4 (17:33):
You know, the data is highly analogous with what we
saw from PC shipments right front running tariffs thing you
were coming that short term long term TSMC is pledged
billions of dollars to build chips in this country. Have
we learned anything more about that in its progress?
Speaker 8 (17:47):
Well, they didn't say anything at this point, but you're right.
They had previously pledged in sixty five billion dollars. More
recently they said they're going to add another one hundred
billion dollars onto that in US investments. They clearly want
to make chips in the US, partly to diversify themselves,
to geopolitically. Partly they'll be able to serve these customers
like Apple, like in Nvidia, like Tesla more effectively if
(18:09):
they're able to do it in the US, and they'll
avoid some of those tariffs if they're going to get
hit with US Now TSMC doesn't sell that many chips
directly into the US, but via Apple and via Nvidia
some of their other customers, they could get hit by
tariffs that go through their end products.
Speaker 4 (18:25):
Playboys.
Speaker 2 (18:26):
Peter Elstrom, thank you quick look at shares of Apple
falling after yesterday's massive rally. But there's also reports that
it shipped about one and a half million iPhones from
India to the United States in an effort to beat
President Trump's tariffs es. According to Reuter's ed, is fascinating
that six hundred tons worth from India. Who knows what
(18:46):
they were shipping on jumbo jets from China?
Speaker 4 (18:48):
Right right? I did the math. I checked the math.
Six hundred tons. The average weight of iPhone around seven ounces,
so with packaging, I think one point five million makes
sense that short term, long term, the only question is
can they build the iPhone outside of China and were
here in the United States? Who knows. Let's get more
on the fallout of US China tariffs and its impact
(19:08):
on Apple currently in a million acy president and prison
analyst that creative strategies joins US. I mean in a
world where the iPhone's built in America. There are many estimates.
Bank of America this week said it would be ninety
percent more expensive. That is an interesting scenario, Carolina.
Speaker 5 (19:26):
Is a very interesting scenario, one that I don't think
is going to happen anytime soon. I think that Apple
has other options before coming to the US. And that's
because unless we are moving part at least of a
supply chain to the US, is really unreasonable to think
that Apple can be successfully building iPhones here. So what
you're seeing with the shipment coming from India is that
(19:50):
Apple has the opportunity not just to ship, but to
actually rethink how and where they build iPhones that are
targeting the US market. So they could shift from China
to India or other manufacturing facilities to avoid some of
the harsher targets that China is faced with today. Obviously,
(20:13):
all of these can change tomorrow or this afternoon.
Speaker 2 (20:16):
What about, of course it can for the margin pressure.
How much will they suck up some of the margin pressure?
How much do you think they can pass on to
a pretty stress consumer here in the US right now?
Speaker 3 (20:27):
There's two aspects of it.
Speaker 5 (20:29):
One is to remember how strong Apple relationship with their
supplier manufacturer is and so there might be a negotiating
part there where it's not about just Apple passing on
to the consumer, but is Apple trading with their supply
chain to see how best everybody can ride this way.
(20:50):
Right at the end of the day, you want to
keep the Apple business with you for the longer time,
and then when it comes to consumer. I think it's
a very critical moment for Apple here in the US
market when it comes to services and Apple Intelligence in particular.
So they will want the upgrade cycle to continue, and
they might decide that it's worth sacrifice in some of
(21:12):
their margins in the short term to then have more
revenue coming from services and Apple Intelligence longer term.
Speaker 4 (21:18):
The story's hit the terminor just now clarifying that the
Trump tariffs on China now add up to one hundred
and forty five percent. You see Apple declines accelerating five percent,
and as that one hundred pushing even lower an airlift though,
have you ever seen that in your career? We just
have thirty seconds, Carolina.
Speaker 2 (21:35):
I had not.
Speaker 5 (21:36):
It's definitely something new, and I think it comes with
the volatility that we're in right now.
Speaker 2 (21:43):
Carolina Milanesi there with all the expertise and the context
president and print of Analystic Creative Strategies. Welcome back to
Bluemak Technology. I'm Karine Hyde in New York. Quick check
on these markets, d because we are accelerating our losses.
(22:04):
We're sub four percent on the last SAT one hundred
after a monster rally yesterday, the biggest gain sets two
thousand and eight.
Speaker 3 (22:10):
We fade some of that? Is it profit taking?
Speaker 2 (22:12):
Is it once again trying to understand what Chinese tariffs
that NAR are to the tune of one hundred and
forty five percent. What that means for the overall risk sentiment?
We're off by four percent on bitcoin, but hold of
ourve eighty thousand. Move on to the individual movers that
want to shine a light on because look, JD dot
Com up more than three and three quarters percent in
terms of ADRs traded here in the United States. China
looking to improve stimulus locally. That means e commerce players
(22:36):
that are domestic related and focused are going to be
doing well.
Speaker 3 (22:39):
But we are fading our rally and.
Speaker 2 (22:40):
Ali Baba, we're fading, of course even more on Apple
best rally since nineteen ninety eight. Yesterday, we're now off
by more than five percent, as those tariffs to China
impact that company, Amazon off by almost five percent, Andy
Jason looking strong into his investor and shareholder note, But
more broadly, we're worried about exposure there as well.
Speaker 4 (22:58):
Ed with you gone, well, let's get back to the
tariff story. President Trump's tariff on Chinese imports now total
at least one hundred and forty five percent. Bluebos Katie Lines,
who leads our political coverage for US in DC, is
actually going to come and do some math for me
because I've lost track on whether this includes reciprocals it doesn't,
and how we got to one hundred and forty five percent, Kayleie.
Speaker 6 (23:20):
Yeah, And this really is about math and how these
tariffs layer on top of each other, as there are
different tariff regimes that China is subject to. As President
Trump made clear yesterday in his post on True Social
he has raised the reciprocal tariff rate on China to
now one hundred and twenty five percent. That of course
has been escalated multiple times due to China's retaliation, but
that did not include the twenty percent tariff that he
(23:42):
had already put into place on Chinese goods earlier this
year over the trade of fentanyl. So it's about adding
that one to twenty five to that twenty percent that
was already existing, which gets us to the total rate
of one hundred and forty five percent. Now this was
actually all there in the White House's fine print, But
obviously it's difficult to understand with this fast moving story
how all of these tariffs work in tandem together. But
(24:03):
it does seem that this is a figure that was higher,
at least than the market previously understood it to be,
which is why we're seeing things take a turn.
Speaker 3 (24:10):
And this comes despite the fact that.
Speaker 6 (24:11):
President Trump in the Oval Office yesterday said that he
couldn't imagine taking tariffs on China any further than he
already had. But maybe perhaps this is further than was
previously understood. Keeping in mind that China has still an
eighty four percent retaliatory rate on US goods. It remains
to be seen whether or not they will escalate that
further and whether or not they are willing to pick
up the phone and talk to Donald Trump, as he
(24:32):
has suggested he is willing to talk to Shijinping wants
to make a deal, thinks China wants to make a deal,
but we have seen no sign of that yet.
Speaker 3 (24:39):
Is this trade war.
Speaker 6 (24:39):
Between the two largest economies only seems to be intensified.
Speaker 4 (24:44):
The us K lines at a DC chief mathematics correspondent.
I appreciate it, Thank you very much. Let's get back
to the market's reaction to tariffs, specifically the pools on
tariff's Like yesterday afternoon, Crazy Bloombo's Ryan for Selca, who
covers the tech sector, joins us Apple. I think, biggest
jump since ninety ninety eight. Test labings jumped since twenty thirteen.
The questions why, like why those levels of gains and
(25:07):
now the pool back this morning.
Speaker 9 (25:09):
Hey, thanks for having me on. So obviously yesterday was
a huge relief rally, and I'm sure there was some
short covering, some algorithmths, trading, all kinds of things just
feeding into the massive gain that we saw yesterday. But
I think once the dust settled a little bit, people
kind of realized, you know, hey, the terroristicainst China were raised,
there's still ten percent tariffs. Kind Of broadly, there's still
a lot of uncertainty, and I think just sort of
(25:31):
the pause in itself is just a sign of how
sort of erratic all the policies have been. There's been introductions, retaliations, escalations,
and now a pause, and it's it's very hard to
know what the next step is going to be, and
therefore it's very hard to know how to position or
understand what the economic outlook might look like.
Speaker 2 (25:50):
Right, Vasilica, with the ongoing uncertainty narrative, we appreciate it.
Let's try and get some certainty on what to do
with your portfolio now. Nancy Tangler, CEO and CIO of
Laffetanglo Investments, joins us now, and look, you've actually been
committed to adding certain names, Tesla being one of them.
Speaker 3 (26:05):
Why do that with the exposure to China?
Speaker 10 (26:07):
Yeah, well that's a great question. We were adding to
it since the market peaked because it got clobbered and
it was actually below current levels. But that is an
ongoing concern though. We're we own that stock for and
we talked about this after Cybercab we Robot Day in
southern California, but we own it for the energy business
and we own it as an AI play. So yes,
(26:30):
the evs matter, but I think it's analogous to Apple.
Speaker 3 (26:34):
What early days.
Speaker 10 (26:35):
When we were buying it twenty thirteen, twenty fourteen, the
iPhone was a means to the services business.
Speaker 2 (26:42):
Really interesting to bring broader context you can still hold
on to amid these day to day voluntile moves in
video or another one you've been adding to. Yes, many
have been quick to say exposure to China. However, some
analysts and coming out and I was saying, this is
one of our favorite picks. They're actually pretty protected from
the border impact.
Speaker 3 (27:01):
How are you looking at that name?
Speaker 10 (27:02):
Yeah, and we know that Jensen Wong met with the
President recently to try to get a carve out. We're
looking at that as part of what we think.
Speaker 11 (27:10):
You know.
Speaker 10 (27:10):
I was on the air on the day Deep Seat
came out, which was another k I seem to attract
it a chaos, that is.
Speaker 3 (27:17):
And what we thought was that.
Speaker 10 (27:19):
It would increase the use cases and the availability of
AI as an option, and we saw that in the
fourth quarter earnings, even though they're backward looking. We heard
from CEOs how broadly they're using it across sectors. And
you heard today Spotify saying we're not hiring anybody unless
you can prove that their job can't be done by AI,
(27:40):
so I think in Vidia is obviously the core of that.
Most of our investments have been on the software side.
We shifted to software about five six months ago, but
we still like that name. It's much smaller holding than
our major holding, Broadcom, which we've called the poor man's
in video, but we do like to add to it
on weakness and it gets these peer it has historically
(28:01):
just like Tesla. If you've owned Tesla since the IPO,
it's been in a bear market almost fifty percent of
the time. Yet it's up thousands of percent. So you
just have to pick your spots, be sure to trim
in these more volatile names when they run up, and
that's what we did last summer, and then we're adding
back in.
Speaker 4 (28:18):
Hello Nancy, It's always great to have you back on
the show. I don't think you attract chaos. I think
you just invest in the areas that attract chaos. It's different.
There's two names that you haven't discussed, and every time
you come on the show, I always so you haven't
discussed one in particular, which is meta, but also Amazon.
Caro brought up a really interesting point earlier, which is
(28:40):
you know Amazon has this duel mandate. It is a
technology stock and it is a retail stock depending on
how you look at it, like a Walmart or it's
a cloud provider.
Speaker 3 (28:50):
Tells me how you feel about them both.
Speaker 10 (28:52):
So Amazon was in our five for twenty five that
I published on twelve thirty one, and it's a member
of our twelve Best Ideas portfolio, and then we own
it in our strategy.
Speaker 3 (29:00):
So I love the name.
Speaker 10 (29:01):
I think it's a defensive technology name that you can
be adding to and here, and we have done that.
But I wrote my notes a couple days ago and
we've added to it since then. So I think it's
an important name to own our poster child for our
investing theme of old economy companies that have pivoted to
(29:22):
the new technologies as Walmart. You saw them confirm their
annual guidance. And then Andy Jasse came out today and
said what Jamie Diamond said. We're cutting costs. We're not
frantically cutting costs. We're going to our management teams and
saying where can we save money. That's a well managed company.
I think it's an all weather stock. Meta we sold,
as you know, and bought Spotify and so I was
(29:43):
beating myself up until I went and looked at the
relative performance since we've done that, and we've done much
better in Spotify, though, I think Meta is a name
you can easily own again and add to in this
weaker environment. That said, the AD revenue for Amazon is
objected to go down half as much as metas if
this all continues. So I think Amazon's the better player
(30:06):
from here, and that's where we've been putting our money
to work. And then Spotify and Netflix are names that
we think will hold up in kind of a low growth,
potentially recessionary environment. Though Goldman withdrew their recession forecasts, so
maybe we're just getting slow.
Speaker 4 (30:21):
Goth Nancy, how do you assess communication from policymakers over
the course of the last five days.
Speaker 10 (30:28):
It's been horrific ed. I just I've been at this
for over forty years. I have never seen a more
botched policy roll out than this, and I think it
did a lot of.
Speaker 3 (30:41):
Damage to the administration.
Speaker 10 (30:42):
I know yesterday, you know, we got the declaration that
this was intended all along, and you just don't understand
the art of the deal. And then Bill Lackman came
out and said, oh, This was executed perfectly by the president,
which makes me think he was selling yesterday into the strength.
Speaker 3 (30:57):
That's just speculation, but I think it's.
Speaker 10 (30:59):
Been horrible and you're seeing more and more of Scott
Bessett and Kevin Hassett, and I think that will benefit
the administration, though their message has been imperfect as well.
It makes no sense from an economic standpoint. Now ten
percent tariff would kind of act like a flat tax
and it would move, It would stop distorting behavior. But
right now, if you think about factory build you know,
(31:22):
we're up three last three years, it has exploded and
it continued into the first two months of this year.
We're now hearing new factories being put on hold. That's
what happens when you distort policy.
Speaker 3 (31:34):
How do your clients feel about it?
Speaker 2 (31:36):
How are they about remaining committed to funds exposed to equities.
Speaker 10 (31:40):
So we've spent a lot of time doing webinars with
our clients in since the market peaked in because there
was already you know, a sharp correction going on.
Speaker 2 (31:48):
Yeh, this whole deep seek was actually the mag seven problem,
not Maga, right, But do you agree with Besson?
Speaker 3 (31:54):
Oh? No, I thought that was also ridiculous.
Speaker 10 (31:56):
I'm sorry, I thought you're That was when it started though,
you know, the sort of franticness, But then we got
a rally.
Speaker 3 (32:02):
No, of course not. I think that's where.
Speaker 10 (32:05):
These guys are losing credibility because those of us that
do this for a living look at it and go, no,
that that's not in.
Speaker 3 (32:10):
Fact what it best't used to do it for a living.
Speaker 10 (32:13):
I know, isn't that interesting? Yeah, and took a very
hard stance on many issues.
Speaker 3 (32:17):
But no.
Speaker 10 (32:18):
But when you go to an administration, your job is
to be an advocate for the policy projected by the administration,
which is why I will never be in politics. But
our clients are pretty measured.
Speaker 3 (32:31):
You know.
Speaker 10 (32:31):
I got calls yesterday should I add more money? And
it was like, no, no, let's wait, this is not done.
But mostly we've seen flows in yeah, not mostly one
hundred percent.
Speaker 4 (32:42):
Yeah for tengler investments. Nancy teglis good to have you
back with us. Thank you very much. Coming up on
the show, Meta faces backlash from whistleblower testimony to Congress
and prepares to fight the FTC on antitrust allegations. Have
more on the social media giants battles next This is
Bloomberg Technology.
Speaker 3 (33:05):
Quick check on these markets.
Speaker 2 (33:06):
The losses are accelerating. We're off by more than four
percent across the S and P and the NASAT. We
wipe off about a third of yesterday's gains.
Speaker 3 (33:14):
The points drags, when.
Speaker 2 (33:15):
In fact there's only six or seven names in the
green on the Nasdaq one hundred. Everything else in the
red booking holdings is a key point drag ASML it's
a dr is a key point drag.
Speaker 3 (33:25):
But so too is meta.
Speaker 2 (33:27):
And let's just talk about meta and social media a
little bit more. Because the EU's governing rules on digital
platforms like X, like meta shouldn't be considered trade barriers
with the United States. That's all according to the EU
Digital Chief, Hennah for Kuna. Speaking with the Bloomberg's Oliver Kruk,
the Digital chief really outlined how the EU's rules affair
for everyone.
Speaker 3 (33:44):
Take a listen.
Speaker 11 (33:45):
These are same rules for everybody. So these are not
like trade rules. So when we speak about Digital Service Act,
Distell Market Acts or AI Act, we know that we
have same rules for other companies who are operating in
the European Union. So for the European companies and also
for Chinese, US and companies, so it's very fail for everybody,
and these are not creating trade barriers.
Speaker 12 (34:04):
And the digital services actually've been expecting some decisions specifically
on META and on X. Is there a delay that
due to the pressure being put by the Trump administration.
When can we expect progress on those?
Speaker 11 (34:15):
We have several investigations going on on the Digital Service
Acts and different investigations, and of course we are enforcing
the rules, respecting also the due process, so and always
when we are doing investigation from the Commission side, of course,
the main purpose is also that we want that the
online platforms that they are complying with our rules, and
(34:38):
often this is the case during the investigations that they
are also chasing their behavior and that is of course
what we want that they are respecting ours.
Speaker 12 (34:45):
So for example X, which is I think the most
advanced the investigation that you have, What would you like,
what is the endgame? What would you like X to
look like? How do you think is an appropriate way
for it to sort of shift.
Speaker 11 (34:55):
What we are saying in our rules. It's very much
that the online platforms they have to have the in
place that how they are assessing and mitigating the systematic risks.
They are posing for civic discourse, for electoral processes, for
people's well being, and also that they are transparent with
the access that the users know for example why certain
(35:15):
content is shown for them, and the users has to
have also choices how to change also the recommended system.
Speaker 12 (35:22):
I like to also get an idea of your sort
of channel of communication to these companies. Have you spoken,
for example, to Elon Marks, Have you spoken to Mark Zuckerberg?
Who have you spoken to the taxis and what are
those conversations like.
Speaker 11 (35:32):
Normally it's of course our commissions technical team who is
working with those platforms technical teams with their lawyers, and
that is all the time the dialogue we have going on.
So when we are enforcing the rules, it's not only
the investigations, so we have all the time several parts.
So we have all the time dialogue with online platforms,
especially of course it's done by our services. And then
(35:54):
also we have different code of conducts. We are preparing
different guidelines online platforms. They are also carrying their own
independent orders, so there's several bars all the time how
we are implementing and enforcing They're awesome.
Speaker 4 (36:08):
That was EU Digital Chief Hennavk and then speaking with
her own Oliver Kirk. Now META is facing congressional criticism
over its dealing with China following whistleblower testimony. Yesterday we
was Ridy Griffin back here with me and SF. The
principal accusation is that made by the whistleblower is that
META was briefing the Chinese communist parties early twenty fifteen.
(36:28):
But reading your story, it's more about the reaction and
fury of the lawmakers, if anything, no doubt.
Speaker 13 (36:34):
In fact, I think this congressional hearing ended up being
an opportunity for members of Congress on both sides of
the aisle, these senators to take aim at Mark Zuckerberg.
They called him inauthentic and disingenuous. Even Republicans were questioning
his magnification if you will, the comments he's made on
Joe Rogan, the famous podcaster, to suggest he is aligned
(36:57):
with Trump's agenda. So this proved to be a blasting
of Zuckerberg and one that we imagine will continue when
they say that they're going to call him to Congress.
Speaker 2 (37:09):
I mean he's also potentially going to be speaking because
of the.
Speaker 3 (37:13):
FTC investigation as well. This is not a great time.
Speaker 2 (37:17):
To have federal leaders seemingly not behind you, particularly when
they're going to be questioning the purchase of WhatsApp, the
purchase of Instagram, and potentially breaking this company apart.
Speaker 13 (37:28):
Yeah, beginning on Monday, we're going to see perhaps the
most existential threat to the company begin with the FTC trial.
So you've got the threat from regulators, lawmakers, and then
pressures internationally from Europe.
Speaker 3 (37:42):
As you had just posted in that.
Speaker 2 (37:44):
Video, Meta currently off by six point four percent on
the day, one of the worst points contributors to the downside.
Speaker 3 (37:51):
Ridie Griffin, thanks so much for keeping us up to speaking.
Speaker 4 (38:01):
It's time for talking tech and first up st Micro
announced plans to cut as many as twenty eight hundred
jobs over three years in an effort to increase efficiency
in automation. Though there was no mention of tariffs, the
semiconducting manufacturer says their latest cost cutting efforts will reshape
their manufacturing footprint and quote resized global cost base. Meanwhile,
(38:21):
the company's supervisory board has officially backed its CEO, Jean
Marc Schowi, just one day after the Italian government publicly
withdrew their support over top management. Plus, Amazon had equipped
some of its delivery vans in Europe with defibrillators to
help speed up aid to heart attack victims. Called Project Pulse,
(38:42):
the program involved over one hundred contract drivers who were
trained on the devices who would receive alerts from citizen
responder apps. Amazon concluded the program after several months and
is evaluating the feedback on future opportunities. And Tesla is
set to open a showroom in Saudi Arabia, the latest
sign that Elon Musk is putting behind a bitter feud
(39:03):
with one of the kingdom's most powerful men. The showroom's
expected to showcase its vehicle line lineup, alongside the CYBERCB
and Opsimus robot. Tesla's entry into Saudi Arabia marks a
sign of goodwill towards the Saudis and a potential growth
market for the company. Caroline and let's.
Speaker 2 (39:19):
Just return to Amazon because it also released its annual
letter to shareholders this morning.
Speaker 3 (39:24):
CEO Andy Jesse acknowledging they want to be.
Speaker 2 (39:27):
More like a startup, but also later discussed that sellers
could be passing on some tariff costs to customers for more.
Speaker 3 (39:33):
We're joined by Blue Most Tom Giles.
Speaker 2 (39:35):
Let's go to the letter first and foremost, because really
trying to show that AI demand is still there, and
also they're trying to be more agile with it.
Speaker 14 (39:41):
They want to be they want to be very like
a startup. They want to be firm, they want to
be agile. And what Amazon one of the sayings that
Amazon is always day one. It's always day Remember what
it's like when you are a new business, you're a
new company, You're just starting out and the world is
your oyster. And that's something that Jasse has worried about
(40:04):
Amazon employees losing over the last couple of years. That's
why he said they all have to come back after COVID,
after people were working from home. He said, come back
because people are losing that sense culture is extremely important Amazon,
and he definitely wants them to get that startup mentality
which is so important for these companies.
Speaker 4 (40:21):
I just tom want to quickly go to the conversation
Caroline had with Andy Jasse earlier in the year, because
it's all about CAPEX. Right, listen to this.
Speaker 2 (40:30):
You did say basically one hundred billion dollar run rate
for CAPEX expenditure. Can you give us even like a
percentage ratedown of how much that goes to distribution logistics
and how much goes to AI shares. You know, you
can tell you most of it, You know most of it.
You know the Lion's share is more than fifty percent?
Speaker 13 (40:46):
Yes?
Speaker 3 (40:46):
Is it more than eighty percent? We're playing the warmer
and colder, yes, exactly.
Speaker 4 (40:53):
No clues in the letter about CAPEX earnings isn't far away,
But I think this isn't the here and now what
people care about.
Speaker 14 (41:00):
Well, right now people are focused on tariffs right and
we're seeing that in the markets. We're seeing it with
the ways that stocks, including of Amazon, are getting whipsawed.
He hinted at that in an interview with another network,
talking about how, yeah, there's an expectation that some of
their sellers are going to pass prices tariffs onto their customers.
And look, they receive a lot of there's a lot
(41:22):
of inventory, there's a lot of products. There's a lot
of sellers who are China based or China affiliated, and
so if that tariff stays where it is, that is
absolutely going to affect Amazon's ability to compete with other
online sellers, especially if those sellers are able to diversify
their supply chain, get those products from somewhere else. A
(41:44):
lot of it is made in China, so a lot
of companies are going to be affected equally in many ways.
Amazon's is going to do what it can to keep
prices low, he said, but there's no way that those
prices will not be passed on in.
Speaker 2 (41:55):
Some way to end users, even as Greenberg reports and
yesterday showed that they've been trying to get that inventory,
been changing it up in response to all of this.
Tom Giles, who flew in on the Red Eye lanning
this morning.
Speaker 3 (42:08):
What a hero. We thank him for being here in
New York.
Speaker 2 (42:11):
Meanwhile, that does it for this edition of Bloomberg Technology.
Ed these marks whipsawing once again.
Speaker 4 (42:17):
Yeah, you put it right earlier. It's a third back
of what we gained yesterday. But there's still concern about Tariff's.
A ninety day pause sent markets to euphoria last night.
I think everyone's taken a bit of a breather. Come
back to us tomorrow on Bloomberg Technology. This is Bloombog
Technology
Popular Podcasts
Las Culturistas with Matt Rogers and Bowen Yang
Ding dong! Join your culture consultants, Matt Rogers and Bowen Yang, on an unforgettable journey into the beating heart of CULTURE. Alongside sizzling special guests, they GET INTO the hottest pop-culture moments of the day and the formative cultural experiences that turned them into Culturistas. Produced by the Big Money Players Network and iHeartRadio.
40s and Free Agents: NFL Draft Season
Daniel Jeremiah of Move the Sticks and Gregg Rosenthal of NFL Daily join forces to break down every team's needs this offseason.
Crime Junkie
Does hearing about a true crime case always leave you scouring the internet for the truth behind the story? Dive into your next mystery with Crime Junkie. Every Monday, join your host Ashley Flowers as she unravels all the details of infamous and underreported true crime cases with her best friend Brit Prawat. From cold cases to missing persons and heroes in our community who seek justice, Crime Junkie is your destination for theories and stories you won’t hear anywhere else. Whether you're a seasoned true crime enthusiast or new to the genre, you'll find yourself on the edge of your seat awaiting a new episode every Monday. If you can never get enough true crime... Congratulations, you’ve found your people. Follow to join a community of Crime Junkies! Crime Junkie is presented by audiochuck Media Company.