Trump-Epstein Ties Back in Spotlight as Fight in Congress Looms

Summary

---

Bloomberg Businessweek Daily Podcast

Episode: Trump-Epstein Ties Back in Spotlight as Fight in Congress Looms
Date: November 12, 2025
Hosts: Carol Massar, Tim Stenovec
Featured Guests: Jamie Tarabay (Bloomberg), Bob Michael (JP Morgan), Trisha Toliver (CAVA), Peter Atwater (Financial Insights)

---

Overview

This episode spotlights new revelations linking Donald Trump and Jeffrey Epstein, as congressional tensions rise over transparency and document releases. The reporting examines the content of recently released emails, the political maneuvers unfolding in Congress, and broader questions about the US economy, the evolving labor market, and the financial fragility among American consumers and businesses. Featured segments include an in-depth look at the K-shaped economic recovery and its impact on both affluent and struggling Americans.

---

Key Discussion Points & Insights

1. Trump-Epstein Emails: Congressional Release and Fallout

Timestamps: [01:31]–[07:41]

• Jamie Tarabay breaks down the newly released Epstein-related emails from 2011, including communications with Ghislaine Maxwell and author Michael Wolff.
  • One email highlighted that “the dog that hasn’t barked is Trump,” referring to Trump’s name being kept out of the spotlight despite allegations in Epstein’s orbit.
  • Michael Wolff and Epstein discuss leveraging their knowledge about Trump, possibly for media appearances tied to Trump’s presidential ambitions.
• Both Republicans and Democrats are releasing different sets of documents, with little explanation, as part of a broader tussle for narrative control.
• Democrats aim to force a House floor vote to release all Epstein-related files, with Rep. Adelita Grijalva playing a key swing role.
• The White House (Press Secretary Caroline Levitt) strongly pushes back, labeling the document releases as “selective leaks…to smear President Trump.” The referenced victim has “repeatedly said President Trump was not involved in any wrongdoing.”

Notable Quote:

• “One of the very early up in our story we say I want you to realize that that dog that hasn't barked is Trump without specifying, of course, that he was referring to the president.” – Jamie Tarabay [02:28]
• “Clearly they've been getting thousands and thousands and thousands of documents. And one side of the aisle is being very circumspect… the other side… deliberate about what they're sharing with everyone.” – Jamie Tarabay [03:31]
• “As long as everyone believes that there's something that's being hidden, those questions will remain.” – Jamie Tarabay [05:42]
• “The victim referenced in the emails had ‘repeatedly said President Trump was not involved in any wrongdoing whatsoever and couldn't have been friendlier to her in their limited interactions.’” – Caroline Levitt, White House (via Bob Michael) [07:55]

---

2. The US Economy: Fragility, Labor Market, and AI

Timestamps: [10:03]–[18:43]

• Bob Michael discusses with Carol and Tim the “squishy” state of the US economy, noting sluggishness against tariff headwinds, government shutdown impacts, and restrictive interest rates.
• There’s a disparity in spending, with high-income consumers maintaining big-ticket purchases, but most companies are in “pause mode” on hiring.
• Gregory Daco’s Three Pillars: The economy is increasingly dependent on (1) affluent consumers, (2) AI-fueled investment, and (3) asset price gains.
  • Concerns surface about what happens if these asset prices drop and affluent spending contracts.
• Upcoming relief “one big beautiful Bill Act” and the “genius act” may bring some stimulus, particularly to lower earners.
• Deregulation is anticipated under a potentially new administration, with financial services likely the first sector to see changes.
• 50-Year Mortgages: Trump reportedly considering, with the White House confirming they’re seriously looking into it.
  • “There's no such thing as a bad bond, just a bad price.” – Bob Michael [15:43]
• Artificial Intelligence: Seen as a double-edged sword, potentially boosting productivity, but risking widespread job losses.
  • The AI boom is compared to the dot-com era, but with genuine deep-pocketed companies and real use cases in supply chains, logistics, and pricing.
• Monetary Policy Outlook: Michael doesn’t see the “punch bowl” being removed (i.e., no major contraction of liquidity) anytime soon.
  • Changing of Fed leadership (Atlanta Fed president Bostic to retire; potential new appointments) signals shifting priorities between “draining liquidity” and supporting activity through easy monetary policy.

Notable Quotes:

• “It feels as though businesses and households are still struggling a little bit with tariffs and the ultimate impact to cost of goods… that's a headwind.” – Bob Michael [11:06]
• “If the AI spending boom ends up being a little bit of a bust… does all this start to come undone?” – Carol Massar [13:33]
• “It’s an exciting time to be in the markets, [and to] see the way policy makers are shifting around.” – Bob Michael [19:13]

---

3. CAVA’s CFO on Consumer Trends, Tariffs, and Growth

Timestamps: [21:54]–[31:47]

• Trisha Toliver, CAVA’s Chief Financial Officer, discusses the impact of government shutdowns on consumer spending, especially in the DC-area markets.
• CAVA is experiencing pressure from tariffs (a 20 basis point impact on food, beverage, and packaging costs), but the company is committed to minimal price increases through 2026.
• Encouragingly, lower-income markets are seeing higher same-store sales growth than more affluent areas, suggesting growing accessibility.
• New stores remain a major driver of capital expenditure, with plans to maintain or increase the rate of openings.
• Investments in kitchen technology are improving operations, staff experience, and customer satisfaction.
• Despite share price struggles, the focus remains on long-term strategy over short-term shareholder returns.
• Labor market challenges persist, but CAVA aims to stay in the top quartile of pay across geographies.

Notable Quotes:

• “The tariffs did have about a 20 basis impact on our food, beverage and packaging costs in the quarter and I expect those to continue into 2026 as well.” – Trisha Toliver [27:33]
• “Our new restaurants that are opening or have opened in 2025… are delivering average unit volumes above $3 million, which is above our chain average. That really underscores the power of the brand.” – Trisha Toliver [25:20]

---

4. The K-shaped Economy: Promise and Peril

Timestamps: [34:27]–[45:57]

• Peter Atwater analyzes widening economic divergence, having coined the “K-shaped” recovery dynamic post-COVID.
  • The top tier of earners have thrived amid asset price escalation and strong financial markets; the lower tier faces mounting pressure from inflation, child care, housing, and “stacked vulnerabilities.”
  • Downward mobility is now more likely than upward mobility: “There used to be a sense that there was a ladder… for those at the bottom, that ladder is gone.” – Peter Atwater [37:20]
• The broader economy is increasingly fragile, even for the affluent, due to the circular dependence of asset prices, AI growth, and luxury consumption.
• Social and political implications loom large as “those at the bottom are not looking for a handout, they're looking for a hand,” says Atwater. He cautions that rising vulnerability and rage at the bottom of the economic spectrum could become a force of destabilization if policymakers don’t act.
• Attempts to fix this require recognizing the deep, multidimensional inequalities (not just economic), and for policymakers to act collectively—“it is in the best interest of both political parties to address this.” – Peter Atwater [43:28]

Notable Quotes:

• “For those at the bottom, things have just continued to deteriorate and now [it’s] compounded by the cumulative effect of inflation... it feels mighty heavy.” – Peter Atwater [35:53]
• “We really don't have a single economy in America. We have two very distinct experiences.” – Peter Atwater [36:39]
• “They want job training. They want opportunities that allow them to move up… They don't want a government handout. They want their products sold.” – Peter Atwater [43:28]
• “I think those at the top ignore the impatience at the bottom. Time moves very slowly when you lack confidence.” – Peter Atwater [45:34]

---

Memorable Moments

• Political Theater Around Epstein Files [04:00–06:00]: Congressional “dueling document drops,” each party releasing incomplete files to shape the narrative.
• Economic Divergence Described as “K-Shaped” [35:53]: Atwater’s vivid description of “a handful of folks who feel invulnerable in a mounting sea of despair.”
• CAVA's Resilience [25:00–28:00]: Lower-income consumers show surprising strength in same-store sales, suggesting some shifts in consumption patterns.

---

Important Timestamps

• [01:31–07:41] – Deep dive into Trump-Epstein emails, congressional politics, and reactions
• [10:03–18:43] – US Economy: Tariffs, monetary policy, AI, and financial markets with Bob Michael
• [21:54–31:47] – CAVA’s CFO Trisha Toliver on consumer trends, inflation, and strategic outlook
• [34:27–45:57] – Peter Atwater’s K-shaped economy analysis, its social and political implications

---

Summary Tone

The tone throughout is analytical and cautious, especially regarding breaking political developments and the economic outlook. The hosts and guests emphasize measured skepticism, careful reporting, and concern about ongoing vulnerabilities that straddle both economics and politics.

---

Transcript

[Carol Massar]

Bloomberg businessweek is brought to you by Evolving Money, a podcast that explores how cryptocurrency is the next logical evolution of the financial system. Follow the podcast, which is sponsored by Coinbase, wherever you get your audio programs. Being a small business owner isn't just a career, it's a calling. Chase for Business knows how much heart and effort go into building something of your own. Manage all your business finances, from banking to payments to credit cards, all in one place with their digital tools. Plus access online resources designed to help your business thrive. Learn [e-mail] business chase for business Make More of what's yours the Chase Mobile app is available for select mobile devices. Message and data rates. May apply JP Morgan Chase Bank NA Member FDIC Copyright 2025 JPMorgan Chase & Co. Introducing the all new Adobe Acrobat Studio now with AI powered PDF spaces do more with PDFs than you ever thought possible. Need AI to turn 100 pages of market research into 5 insights with a click. Do that with Acrobat. Need templates for a sales proposal that'll close that deal. Do that with Acrobat. Need an AI specialist to tailor the tone of your market report to sound real smart in real time. Do that with the all new Adobe Acrobat Studio. Learn [e-mail] do that with Acrobat. Bloomberg Audio Studios Podcasts Radio News.

[Jacob Goldstein]

This.

[Carol Massar]

Is Bloomberg Business Week Daily reporting from the magazine that helps global leaders stay ahead with insight on the people, companies and trends shaping today's complex economy. Plus global business, finance and tech news as it happens. The Bloomberg Business Week Daily Podcast with Carol Massar and Tim Stanbeck on Bloomberg Radio. All right, disgraced financier Jeffrey Epstein appeared to allege that Donald Trump spent hours, hours in a house with one of the late sex traffickers victims and suggested that the President was aware of his activities in emails released today. Tim by congressional Democrats.

[Bob Michael]

With more on what was released and what we know. Joining us is Jamie Tarabay, Bloomberg News National Security Reporter, joining us from the Bloomberg News Bureau in Washington, dc. Jamie, these emails that we're talking about, what exactly were in them? Give us the time period, what information and details we were able to garner from them.

[Jamie Tarabay]

Hi. Well, they were released. One of them was a 2011 email that Epstein had written to Ghislaine Maxwell, who as we know is in jail for her role in helping Jeffrey Epstein abuse and potentially traffic young women. And one of the very like very early up in our story we say I want you to realize that that dog that hasn't barked is Trump without specifying, of course, that he was referring to the president. And he went on to say that a victim had spent hours at my house with him and that he has never once been mentioned as in the middle of everything that he was dealing with, the name of Trump had been kept out of the spotlight. There's more. There's a back and forth between Jeffrey Epstein and the author Michael Wolff. Michael Wolff suggests that he could use his connections and his knowledge of what Trump may or may not have done with him regarding these potential, these victims as leverage as he was preparing himself to run for president. And there was also a conversation in later documents that were released this morning between Wolf and Epstein about doing a CNN hit about Trump right after or before he was due tobefore President Trump. Donald Trump was about to do a presidential debate on air. So it's very interesting because obviously this is coming on the first day, most of the house returning to D.C. and the government on the verge of being reopened. It's also a huge signal that whatever it is, that whatever lull had happened in the questions over the Epstein matter, both Republicans and Democrats have been trying to seize the narrative in these, in these releases of files. The House Oversight Committee, which is chaired by a Republican, literally sent out dozens and dozens of files this morning without any real kind of explanation of what they were. Some of them were spreadsheets that didn't really make any sense. There was a video of a dog with a doll of Donald Trump and the doll of Hillary Clinton, which was very strange. And then the Democrat members of the Oversight Committee sent out more emails that they were seeing as well. So clearly they've been getting thousands and thousands and thousands of documents. And one side of the aisle is being very circumspect about what they're sharing, and the other side of the aisle is deliberate about what they're sharing with everyone.

[Carol Massar]

To be fair, we noted that in the story, too, that we put out on this, that back in July, President Trump told reporters that he had nothing to do with the guy and that he never went to the island, referring or appearing to refer to the properties in the Caribbean that belonged to Jeffrey Epstein, where it is alleged that the financier sexually abused and trafficked young women. How do these emails perhaps do they clearly contradict some of the current thinking about the relationship between Donald Trump and Jeffrey Epstein? Because it's not like it's an email between Donald Trump and Jeffrey Epstein. So, like, we're all just being smart and careful here. So I'm just curious.

[Jamie Tarabay]

I think that being smart and careful is probably the only thing we can do right now, and we're not really. But it also, what it really kind of speaks to is the unending curiosity about this case and the reality that unfortunately for the White House, no matter how much the president has tried to divert or dismiss the focus on the Epstein matter, that as long as everyone believes that there's something that's being hidden, those questions will remain. And to release things piecemeal is, isn't going to satisfy so many people who include themselves in Trump's base of supporters. And to have it come on this day, on the day Adelita Grialva, who was elected to represent her district in Arizona in September 23rd, today she is finally going to be sworn in. And she has said she is going to be that last, barely essential, necessary signature on the discharge petition that would force the House to vote on the release of these files. And then to hear this clamor of activity from the White House, according to all the reporting that we're seeing, according to Hakeem Jeffries, the Democratic leader in the House is saying that people are trying to get those who, the Republicans who voted for the discharge position to withdraw their, their support ahead of her confirmation because once she's in, that's something that you can't undo. And so all of this noise and all of this clamor, it doesn't really track with the dismissal of this incident being a hoax and that this relationship being nothing worth noting. And unfortunately, until everyone gets the documents or sees enough to satisfy their curiosity, that attention and that focus and that, that, that skepticism is going to remain.

[Carol Massar]

All right, so to be continued, I'm guessing. Jamie, thank you so much. Carefully reported out and covered by our Jamie Tarabe, Bloomberg News national security reporter. She's there in our D.C. bureau for Bloomberg News.

[Bob Michael]

We should know. White House Press Secretary Caroline Levitt said in a statement, quote, the Democrats selectively leaked emails to the liberal media to create a fake narra to smear President Trump. Levitt also said the victim referenced in the emails had, quote, repeatedly said President Trump was not involved in any wrongdoing whatsoever and couldn't have been friendlier to her in their limited interactions. Stay with us. More from Bloomberg businessweek Daily coming up after this.

[Carol Massar]

Bloomberg businessweek is brought to you by Evolving Money, a podcast that explores how cryptocurrency is the next logical evolution of the financial system. The program investigates how traditional finance firms are integrating crypto into their operations now that Washington has begun to pass much needed regulations. Follow the podcast, which is sponsored by Coinbase. Wherever you get your audio programs in the heat of battle, your squad relies on you. Don't let them down. Unlock elite gaming [e-mail] Dominate every match with next level speed, seamless streaming and performance that won't quit. Push your gameplay beyond performance with Intel Core Ultra processors for the next era of gaming. Upgrade to smooth high quality streaming with Intel Wi Fi 6e and maximize game performance with enhanced overclocking. Win the tech search power [e-mail] lenovo lenovo.

[Jacob Goldstein]

This is Jacob Goldstein from what's yous Problem? Business software is expensive and when you buy software from lots of different companies, it's not only expensive, it gets confusing. Slow to use, hard to integrate. Odoo solves that because all Odoo software is connected on a single affordable platform. Save money without missing out on the features you need. Odoo has no hidden costs and no limit on features or data. Odoo has over 60 apps available for any needs your business might have, all at no additional charge. Everything from websites to sales to inventory to accounting, all linked and talking to each other. Check out [e-mail] that's odoo.com youm're listening.

[Carol Massar]

To the Bloomberg Businessweek Daily Podcast. Catch us live weekday afternoons from 2 to 5 Eastern. Listen on Apple CarPlay and Android Auto with the Bloomberg Business app or watch us live on YouTube. Treasuries with yields dropping across the curve, I bets that the Fed will have room to cut rates next month. That last meeting of 2025 maybe to help prop up the US jobs market, traders might get some clues. We've got a lot of central bankers out there speaking. We are curious to see what Bob Michael has to say. He's Chief Investment Officer, head of the Global Fixed Income, Currency and Commodities group over at JP Morgan Asset Management. A certainly well known voice here across Bloomberg platforms. Joining us in studio. Welcome, welcome.

[Bob Michael]

Happy to be here.

[Carol Massar]

Well, it's great to have you here. I feel like there's some different views out there like the tariff banks may be not completely done. We've got a growing U.S. budget deficit, Bob. We've got a slowing U.S. labor market. How do you see today? Let me throw this in. More Americans falling behind on their car payments. How is the US Economy right now? How do you see it?

[Bob Michael]

I think the US Economy is just okay. It's not great. I think recession is remote, but it's a little bit squishy. So it feels as Though businesses and households are still struggling a little bit with tariffs and the ultimate impact to cost of goods, I think that's a headwind. Certainly the government shutdown hasn't helped with sentiment. And of course, the Fed has highlighted for a while that interest rates are a bit on the restrictive side. And I think all of those things are conspiring to take a little steam out of the economy right now. The part, the labor market part is what I'm really interested in hearing from you. Absent government data for a couple of months, what's an accurate view of the strength of the labor market right now? So the government data is one thing, but you and I both work in franchises which have ungodly amounts of data. We use that. We look at the Chase data, we look how the consumer is performing. The consumer looks okay. Deposit balances look okay. We're seeing big ticket purchases starting to tick up a little bit. But of course, all of that is concentrated in the top quintiles of earners from businesses. Our equity and credit analysts talk to literally hundreds of businesses a day. And what we're hearing there is they don't feel an urgency to do any hiring. They're in pause mode headed into year end. And of course that would weigh on the labor market.

[Carol Massar]

I want to bring in to something that, and forgive me if I mispronounce it, Gregory Daco, he's chief economist at Eye Parthenon Dacko and he says the economy remains resilient on the service, but it's increasingly dependent on three narrow, interconnected a pillars, affluent consumers, artificial intelligence field investment and asset price gains and talks about how they're connected. Right. We know the wealthier consumer has been out there spending. They're responsible for really a big bulk of consumer spending that goes on in the U.S. but if the AI spending boom, Bob, is not but if there ends up being a little bit of a bust, a big bust or something, or we start to talk about right now we're talking about the spending and on balance sheets and you know, whether or not we're going to have to kind of replace these, these items, they're not going to last forever, whether it's chips or what have you. But what if we see those asset prices come down, the affluent consumer doesn't feel so affluent, they stop spending. Does all this start to come undone?

[Bob Michael]

It could. But I think we have to remember we're a month and a half away from the one big beautiful Bill act hitting. And when you look at the one big beautiful bill act and think about the tax refunds on tips and overtime and Social Security payments. Where are most of those? Those are in the bottom couple quintiles of earners. So you're going to get some relief there. You think about the genius act and a lot of things that are happening there. You're going to see some spending there. And the one thing nobody really talking about right now, which we see on the horizon is deregulation. It's certainly going to come to financial services. It will likely come to other industries as well.

[Carol Massar]

Well, that makes me think about. And we weren't going to talk about this till a bit later on, but we do know that President Trump is hosting a little soiree with a bunch of financial executives. Jamie Dimon is going to be there, at least according to reporting or people who have been briefed on the event. Is that what they're going to talk about, the regulatory environment? Have you talked to Jamie about this? But if you are sitting down with.

[Bob Michael]

When I looked at some of the attendees, I suddenly thought, boy, there's going to be one outspoken bank CEO there.

[Carol Massar]

Rhymes with.

[Bob Michael]

I'm sure they're going to do a lot of listening. I think they're going to be a sounding board for a lot of things. The things that have been mooted in the market recently, $2,000 payments that go out, checks get cut, 50 year mortgages. Maybe not. Maybe you just take your mortgage with you. I think this is going to be an administration that will bounce things off of them. Yeah, I think it will be one that will ask them what do we need to do to unleash big banking, big business? Are there other things that can be done? And I think there's going to be a group there that will be pretty free flowing with the information, for what it's worth. Caroline Levitt at the White House was asked earlier this afternoon about the 50 year mortgages. She said the administration is serious, seriously looking into 50 year mortgages. I do want to go back to that.

[Carol Massar]

Would you recommend investors buy a 50 year mortgage?

[Bob Michael]

Wait, which side are you talking about? Like, I mean, someone buying. I got taught very early there's no such thing as a bad bond, just a bad price. So it depends on where it gets priced and the features in it. I do want to go back to AI because Carol, you didn't answer the question Carol asked.

[Carol Massar]

No, but depends on price.

[Bob Michael]

Okay. It's secured by a home. I would buy it. Okay. I absolutely would buy it. We were talking about one side of what ends up happening with AI and if there is Potentially some sort of unraveling, given or bust. What about the other side? What about the side where everything actually exceeds expectations, where productivity increases as a result of this technology and then potentially we see widespread job losses. Are we looking at the right parts of this right now? Are we understanding where we could see productivity gains? I think you have to look at it all and I think you have to realize that unlike the dot com bubble where nobody envisioned the iPhone 10 years later or whatever, and there are companies without revenue, without even really business models that were worth billions of dollars, you actually have deep pocketed companies that are either developing or investing in it. And it is everywhere. We see it in JP Morgan, how it's being used everywhere, everywhere to create efficiencies. You talk to any company now and they talk about how they operate in real time. They can shift their supply chain. So think about the logistics and shipping. All of that can have some sort of AI overlay to it, how they manage their pricing that could have an overlay to it. And those are two big things that have come out of tariff policy. And already we're seeing AI introduced there.

[Carol Massar]

So what could possibly go wrong here in all that's coming at us?

[Bob Michael]

I always go Back to William McChesney Martin whose comment was I kind of.

[Carol Massar]

Wish Tom was here because he would love that.

[Bob Michael]

Our job is to take away the punch bowl. And the reality is there's a lot of money sloshing around in the system. Policymakers on the monetary side and the fiscal side are working hand in hand. You may even see the regulatory side as part of that accommodation coming from everywhere. But we're not looking at the next Paul Volcker being appointed to the Federal Reserve. We're looking at people who fundamentally believe that lower interest rates create a level of economic activity which will generate higher productivity. So for me, as long as that's in place, I'm not really worried. I would get worried when you have to take the punchbowl away. Growth and inflation pressures are so high you have to start draining liquidity from the system.

[Carol Massar]

But you don't think we're there?

[Bob Michael]

No, I don't think we're going to be there any time next year.

[Carol Massar]

Well, that brings us to one last question. We got the news today that Fed bank of Atlanta President Raphael Bostic announced plans to retire at the end of his current term in February. We are seeing a changing composition, Bob, of the Fed, new names, more to come. Kevin Hassan telling Carlyle groups and host of peer to peer conversations, David Rubenstein that if President Trump asks Hassett will do it. He also said he had high regard for Fed Chair Jay Powell. This changing the composition of the Fed, good, bad, how does that help hurt in getting policy?

[Bob Michael]

I think it's reality. I think you have to accept that these are political appointees. And believe me, I know that they go into rooms, they work with their staffs and they try to make the very best decisions. But they come with different core fundamental views. And one could be the William McChesney, Martin, Paul Volcker kind of view, which is there's too much money sloshing around the system. Get it out of here before we have an inflation problem. A Hans Teetmayer kind of central banker and others come thinking, no, we need to be able to create liquidity, make mortgages and housing affordable. That will create economic activity which which gets taxed. There will be productivity that comes out of AI which will offset that headwind. It's an exciting time to be in the markets, an exciting time to see the way policy makers are shifting around.

[Carol Massar]

Come back soon.

[Bob Michael]

Always happy to be invited.

[Carol Massar]

Okay. We will definitely invite you, Bob. Michael, thank you so much. Really appreciate Chief Investment Officer, head of the Global Fixed Income, Currency and Commodities Group over at JP Morgan Asset.

[Bob Michael]

Stay with us. More from Bloomberg businessweek Daily Coming up after this.

[Jacob Goldstein]

This is the Bloomberg Business Week Daily Podcast. Listen live each weekday starting at 2pm Eastern on Apple CarPlay and Android Auto.

[Bob Michael]

With the Bloomberg Business app.

[Jacob Goldstein]

You can also listen live on Amazon Alexa from our flagship New York station.

[Carol Massar]

Just say Alexa.

[Jacob Goldstein]

Play Bloomberg 11.

[Carol Massar]

Shares of Kava slightly lower down about a half a percent in today's session. They are down around 56% year to date. They are also down nearly 70% from an all time high last December. And nearly 15% of the float is short. Now keep in mind the company did report after the close of November 5th, the stock closed down about 2.6% the following day on that news. What the earnings news was Kava Group cutting its full year sales growth targets after its foot traffic stalled in the third quarter. And that added to some worrying trends that financially squeeze consumers are foregoing fast casual restaurants. To be fair, we've seen this at some other fast casual restaurants. So back with us in our latest installment of CFO Briefing, Trisha Toliver, she is the Chief Financial Officer of cava. Joining us from Baton Rouge, Louisiana. She will be featured in an upcoming CFO Briefing newsletter and then also with us in studio is Nina Trentman, Bloomberg News Senior Editor. She writes the CFO Briefing newsletter which you can subscribe to and [e-mail] CFO briefing good to have you both here. Trish, I want to start with you because we actually saw Citi come out and Kava and Sweetgreen were put on Citi's 90 day positive catalyst. Watch an analyst there noting that sales he expects to improve off lows as the US Government likely reopens in the coming weeks. I'd love to start there. And welcome, welcome, welcome back to Bloomberg. How has the shutdown hurt business and how does it look from here on out if indeed we see the government start opening?

[Trisha Toliver]

Hi Carol, it's good to be with you today. Certainly as we experienced the shutdown and around the middle of October, around the time when people in the District, Maryland, Virginia stopped receiving their paychecks, we did see a slight step down in spend in those markets. Certainly not anything acute but certainly an impact that we noticed in the business overall. So as we look forward to hope and hopefully a return to work in the near future, it's likely that it will have a benefit. But really what we're wanting to do more focused is on the long term and what that means for Kava to be able to provide incredible food, abundant offerings with amazing flavor that make you feel good while you're eating it and after. And we believe that relevance will continue to drive benefit for the business over the long term. The other thing to keep in mind is that we were actually we are anniversary or lapping very strong same restaurant sales in the prior year, fourth quarter at 21% and so that is what's influencing our outlook for the rest of the year in 25 and as we go into 20, looking forward to the culinary offerings that we have that we can bring to our guests every day.

[Bob Michael]

Trisha, thanks for joining us again. Just wondering in terms of your view of the consumer, we've seen restaurant chains, not just you but also others reporting weaker results and cutting forecasts. What's your view of the consumer from here?

[Trisha Toliver]

We've heard a lot about the K.

[Bob Michael]

Shaped economy where sort of well off people are doing well but the weaker income bands are just just spending less. Is that something that you are concerned about?

[Trisha Toliver]

Certainly you can see from the high frequency data with credit cards that the consumer is feeling some more pressure as well as just the consumer sentiment in general. There have been a lot of challenges as the consumers are facing them in the near term and as we experience those in our business. What we're finding is that consumers continue to lean into our premium items. So our amazing steak and our new chicken Shawarma as well as attaching with incremental items like our fan favorite pita chips. Right now we've got cinnamon sugar pita chips with a drizzle of honey. That's incredibly tasty.

[Carol Massar]

I'm hungry.

[Jamie Tarabay]

I know, I know.

[Trisha Toliver]

I had them for lunch today. So it was. They're incredible. But they're that as well as our house made juices. So those are continuing to attach an increase. And also when you look at our restaurants and how they're positioned based on median household income in their markets, we're finding that the lower income consumers actually experiencing in those restaurants higher same restaurant sales than the rest of our cohorts of restaurants. So from that standpoint point, it's encouraging to see that we are becoming more accessible for the lower income consumer and driving increase in sales in those areas.

[Bob Michael]

How does the weaker results that you reported in the quarter, how does that impact your thing you're planning on on future growth like I know that you wanted or are planning to open as many restaurants next year roughly as you open this year? Is that still the plan?

[Trisha Toliver]

We do intend to continue to increase the opening of our restaurants with at least 16% growth in restauran in 2026. This year we'll open at least 68 to 70 restaurants. And what we're seeing is that despite the challenges we see with the consumer today, we're very encouraged about the strength of the business and what we are able to offer. So our new restaurants that are opening or have opened in 2025, those restaurants are delivering average unit volumes above $3 million, which is above our chain average. And that really underscores the power of the bank, the brand itself, that the excitement around the consumers that we come into new markets and existing markets and gives us the confidence in our white space opportunities that we will continue to lean into our growth in new restaurants as we move forward.

[Bob Michael]

Certainly new restaurants a big part of Capex this year and next year. But where else are you investing?

[Trisha Toliver]

We're always looking for ways to make our operations and our restaurants easier to run for our team members. So some of the investments we're making are in equipment in the restaurants to streamline operations like our kitchen display systems, which works well with our digital ordering systems on the back of the house, which supplies our digital customers. Those tools allow our operators and team members to fill orders more easily and create a higher level of accuracy. We've also equipped our restaurants with Turbo Chef ovens. Many of our restaurants didn't have them. And in this year we made those investments. It streamlines cook times, creates better quality and efficiency, and simplifies operations for the team members overall. Our view at CAVA is a happy team member equates to a happy guest and a happy pnl. And we're always looking for ways to reinvest in the business to drive that.

[Carol Massar]

Let's talk PNL and I'm just curious about, you know, in your earnings tariffs talked about how they have hit your or you guys talked about how tariffs have hit your restaurant level profitability through higher food, beverage and packaging costs. Is that just the new reality and new normal that will stay with us for longer or perhaps forever? I'm just curious how you what your read on that and then how does it play into pricing? Because I think you guys were still looking to limit price hikes now and also into 2026. But is that maybe up in the air?

[Trisha Toliver]

Yes, the tariffs have certainly been an evolving and ever changing area. Luckily, one of our values is to act with agility. So our team members on the supply chain side have done an incredible job in minimizing that impact as much as possible. But the tariffs did have about a 20 basis impact on our food, beverage and packaging costs in the quarter and I expect those to continue into 2026 as well. And what we've done from a pricing perspective is really try to minimize we took no incremental price in 2025 related to those incremental costs that we were incurring. We didn't believe we should put that on our guests and wanted to absorb that and try to continue to elevate our value proposition which is quite high amongst our peers. And then as we think about it going into 2026, we're also going to be very mindful about price increases and anticipate very modest increases. Since the end of 2019 to the end of the third quarter, we've only raised price less than 10 CPI or inflation and less than half of many of our industry peers. And that's something that we feel very strongly about and a trend we expect to continue to do despite the pressures we may experience on our input costs.

[Carol Massar]

Trisha so I get that. So it sounds like you are being incredibly inhabitant mindful in terms of price increases on consumers. Having said that, if no price increases, but you did say that the tariffs have hit you guys on a couple of different levels. Does that mean margins take, take, take a hit or where do you squeeze costs out? Is it workers? Is it the supply chain? Where do you squeeze price? You know, some of the cost of this out.

[Trisha Toliver]

So certainly in 25 we took no incremental price related to tariffs. And in 26 there'll be modest menu price increases. That helps minimize any inflation that we experience on the labor side as well as the input cost side. And then there are other opportunities from an efficiency standpoint as we grow in scale that we will continue to deploy to minimize the impact on the P and overall.

[Bob Michael]

Trisha, your share price is down quite a bit this year. I'm just wondering from a CFO perspective, is there room for shareholder returns? Like are you thinking about buybacks? What's the measure to, to get your share price back up?

[Trisha Toliver]

Well, we've always said since the beginning is this is a journey and a long term journey overall. And so while the share price can go up and down, we want to remain focused on the business over the long term. And what's that, what that we can do to make sure that we drive that and we stay focused on our strategy and committed to that. We'll always explore opportunities, opportunities to strengthen and maximize those returns. And right now we're just going to continue to remain focused on the strategy we have at hand and that is opening and expanding the Mediterranean way across the country and running great restaurants, every location, every shift and deepening personal relationships with our guests with a high performing team.

[Bob Michael]

You have stores in more than a dozen states in D.C. so this question is dependent on geography, but in general, the labor market right now. We our team has reported on Walgreens cutting pay for hourly workers after its private equity buyout. Is the labor market better for hiring people right now?

[Trisha Toliver]

You know, we're in 28 states in the district in Columbia, across the country. And the labor market is one that we keep a very close eye on. And our focus is making sure that we're paying a very fair wage in every market across the country. So I work closely with our operations and people and culture team on a quarterly basis to evaluate our wages to make sure that we're in the top quartile of pay so that we don't have as much pressure on wage and can bring on high quality team members that can lead the future growth of our business overall.

[Carol Massar]

All right, next time you have to send us some pita chips. I'm just going to say. Am I allowed to say that we.

[Bob Michael]

Can go get them?

[Carol Massar]

We could. Why didn't we do that? I'm just kidding. I'm just kidding. You're right. We could just scoot out out here on park. In a park. But is it third or Lexington.

[Bob Michael]

There are a lot of stores. I'm looking at the website right now. There are a lot of stores in.

[Carol Massar]

New York around us. Hey listen Trisha708 third check it out knows Trisha. Thank you so much. Trisha Toliver back with us, Chief Financial Officer of CAVA joining us from Baton Rouge, Louisiana. And of course, our thanks always to Nina Trentman, Bloomberg News Senior Editor. She writes the CFO Briefing newsletter. You can subscribe to [e-mail] CFO briefing and a new one comes out every Sunday.

[Bob Michael]

Stay with us. More from Bloomberg businessweek Daily coming up after this.

[Carol Massar]

In the heat of battle, your squad relies on you. Don't let them down. Unlock elite gaming [e-mail] Dominate every match with next level speed, seamless streaming and performance that won't quit. Push your gameplay beyond performance with Intel Core Ultra processors for the next era of gaming. Upgrade to smooth high quality streaming with Intel Wi Fi 6e and maximize game performance with enhanced overclocking. Win the tech search power [e-mail] lenovo lenovo.

[Jacob Goldstein]

This is Jacob Goldstein from what's yous Problem? Business software is expensive and when you buy software from lots of different companies, it's not only expensive, it gets confusing. Slow to use, hard to integrate. Odoo solves that because all Odoo software is connected on a single affordable platform. Save money without missing out on the features you need. Odoo has no hidden costs and no limit on features or data. Odoo has over 60 apps available for any needs your business might might have, all at no additional charge. Everything from websites to sales to inventory to accounting, all linked and talking to each other. Check out odoo@o d o o dot com. That's o d o o dot com.

[Bob Michael]

Hey audiobook lovers.

[Jacob Goldstein]

This week on the podcast I'm sitting.

[Bob Michael]

Down with musician, producer and walking encyclopedia Questlove. We're Talking about Mark Ronson's memoir, Night.

[Carol Massar]

People how to be a DJ in 90s New York City.

[Bob Michael]

All right, like we talked about before.

[Jacob Goldstein]

Mark Ronson found sanctuary in the DJ booth.

[Bob Michael]

What's a tool or piece of equipment in the studio or on stage that gives you the most control? So I have two microphones on stage. We have the microphone that you hear as the audience. Then we have a second microphone in which we communicate with each other. I feel like that second microphone kind of saved all of our friends friendships. No band likes each other after 20 years or 25 years. The Beatles broke up in seven and a half years and we're going on 35. Listen to Earsay, the Audible and iHeart Audiobook Club on the iHeartradio app or wherever you get your podcasts.

[Carol Massar]

You're listening to the Bloomberg Business Week daily podcast. Catch us live weekday afternoons from 2 to 5 Eastern. Listen on Apple CarPlay and Android Auto with the Bloomberg Business app or watch us live on YouTube.

[Bob Michael]

Well, we're trying to understand where we are in this economy with a lack of government data with starkly different signals coming from different segments of the consumer. The latest and it is one of the most read stories today on the terminal. It's about how more Americans than ever, Carol, are falling behind when it comes to those car payments.

[Carol Massar]

I got to say we've been talking about this a lot today. With ongoing inflation pressures and the return of student loan bills, millions of car owners are struggling to afford their monthly pay. The latest sign of weakness in the United States in the economy as the Fed considers the path of future rate cuts. So we wanted some help with what this economy really looks like. We turn to a friend of the program. He is the author of the Confidence Map, Charting a Path from Chaos to Clarity. It's a book that digs deep into decision making. It is super great to have. Back with us, Peter Atwater, president of Financial Insights and adjunct lecturer of economics at the College of William and Mary. He joins us from Our Bloomberg Washington, D.C. bureau. You've been such a good friend actually to Bloomberg today. I know we've had you on, I think you've been on on the Balance of Power. You're going to be on later on on btv. But we're really glad because this big take and I feel like your thoughts around this, how many years ago when you started talking about a K shaped economy, I feel like this is something that the economy maybe not yet quite markets, but politics like it is front and center. PETER so where are we with this cake shaped economy and why hasn't it gotten better?

[Jacob Goldstein]

So Carol, it's been more than five and a half years since I first started writing about the K shaped economy. And I think what's happened is that for those at the top, the financial markets have been extraordinary. Meanwhile for those at the bottom, things have just continued to deteriorate and now compounded by the cumulative effect of inflation on particularly for food, you referenced the car loan delinquencies and that's another sign. And you know, I think that those at the bottom have this heavy weight, whether it's child care, education, housing, it feels, it feels mighty heavy to those at the bottom. And I think at this point we really don't have a single economy in America. We have two very distinct experiences.

[Carol Massar]

So are we becoming, Peter, an economy, a country where there are a few rich people who are living in a poor country?

[Jacob Goldstein]

I would describe it, yeah, as a handful of folks who feel invulnerable in a mounting sea of despair.

[Bob Michael]

Hasn't it been like that for years, though? What's different about right now? I mean, I remember having the same discussion, not with the same data, but in graduates school in a class about how in the developing world you start to see economies such as this. And that was what the professor was arguing where we were headed in the U.S. it's been like this for quite some time.

[Jacob Goldstein]

The gap has existed, but not to this extreme. And remember, Tim, there used to be a sense that there was a ladder, a way to progress from the bottom up through the middle class and into the upper middle class and then into the truly wealthy. And for those at the bottom, that ladder is gone. There are no more rungs that enable them to go up. And I think we have fallen into a more of a caste system that, to your point, looks less like the America that many were promised and more like a lot of the developed nations around the world.

[Carol Massar]

So when does it show up, Peter? I feel like we definitely, you know, we just talked with the CFO of Cava and we definitely saw it Chipotle, where they are seeing their business impacted because those who are at the lower economic rung, if you will, when it comes to the US economy are having, are having troubles. And so they're not going to Chipotle or they're not going to Cava and, and a few other places. But when does this really start to show up in our economy, in the financial markets? Just curious.

[Jacob Goldstein]

So in terms of consumer sentiment, it showed up almost immediately after Covid, when those white collar workers were able to pivot to work from home, their confidence was restored. They also got boosts from monetary and fiscal policy. And for those at the bottom, those, those stimulus checks really just went through them to their lenders, to their landlords. And so this has been ongoing for a long time. And I wouldn't underestimate the compounding effect that time has for those at the bottom. And I think it's showing up in the affordability message that you're seeing now politically.

[Carol Massar]

All right, the other part I want to get to is ask you about is the upper part of the K, because what we're starting to hear and chief economist over at EY Parthenon, he says the economy remains resilient on the service, but it's increasingly dependent, Peter, on three narrow interconnected a, a pillars, affluent consumers, artificial intelligence fueled investment in asset price gains.

[Bob Michael]

And the concerns again, that's Gregory Daco, right?

[Carol Massar]

Yes, exactly. Thank you. And so the other thing is then I guess I'm broadening out a little bit because I, you know, very worse than what's going on in those who are just struggling to get food on their table or pay their bills. But at the upper ring, and I'm thinking about the broader economy as well. We know the richer consumer is responsible for a bulk of the consumer spending that goes on the economy. And they have felt upbeat because we've seen stock market highs and that is a result of in a big way all of the spending on the AI build out, if that it's starting to be questioned that build out a little bit and really replacement of chips and so on and so forth and those costs and how they are amortized on balance sheets and so on and so forth. But I guess my concern is when you look at this economy, is it kind of fragile even, perhaps potentially for those who are even wealthier in this economy?

[Jacob Goldstein]

I think so. And I think that what there's been lots of discussion about the circularity within the aisle, right. I think that circularity exists more broadly between the wealthy AI and you see that in first class travel. You see that in a lot of the, the luxury experiences. And we used to say that the, the economy is not the markets, but at the upper end the markets and the economy are now indistinguishable and we need to appreciate the fragility of overconfident financial financial markets. If I look at the amount of speculation going on through options and the price to price to earnings multiples, there are lots of signs that this is a market that feels extraordinarily confident. And ironically that's where the fragility ultimately rests.

[Bob Michael]

What about this idea of the meritocracy or the idea that people actually in this day and age have a harder time time moving in and out of social strata? The American dream is this idea that anyone can come to the United States and succeed regardless of where they start. You argue that that doesn't exist as much anymore. Why is that?

[Jacob Goldstein]

So wealth accumulation happens more slowly. You look at for example the fact that it now takes to age 40 to be a first time home buyer. It wasn't that long ago when that age was 25. And so the wealth accumulation Potential for this new generation is far less than the generation before, assuming that housing is a means for accumulating wealth. And so what you're seeing is, particularly with things like child care and health care, the burden on those families starting out is substantially higher than the one certainly I experienced and likely the one you started with.

[Carol Massar]

All right, so how do we fix this? Because it does feel like you have three minutes. Peter Fix the problems that. Alice?

[Jacob Goldstein]

No, I think that policymakers need to be really attuned to this. I think they shouldn't ignore the message of affordability that came out of the New York mayoral election. What we're seeing, what we're seeing is not a movement to the left as much as a movement down. And I think policymakers really don't appreciate how purple the bottom of our economy is, and it's increasingly purple with rage. So we need to address their shared vulnerability, their despair, because ultimately history shows that that when it becomes widespread, those with nothing to lose will gladly go after those with everything to Lou, do.

[Bob Michael]

Policymakers actually have the tools in a divided country to fix this?

[Jacob Goldstein]

I think they do. I think it requires them to recognize that it is in the best interest of both political parties to address this, because we know that anti establishment establishment candidates become more popular. We know that progressive candidates become more popular. And so it behooves them to pay attention to this and to address it. And to be clear, those at the bottom are not looking for a handout, they're looking for a hand. They want to see job training. They want to see opportunities that allow them to move up, as we saw from the soybean farmers and the ranchers. They don't want a government handout. They want their products sold. They want to have a real meaningful purpose in this economy.

[Carol Massar]

You know, Peter, I'm thinking of the big take that you do with Sarah Holder that's on the Bloomberg right now. And I guess they were asking, she was asking along with Katerina Suriva, talking about this K shaped economy not just being kind of the same as like measuring inequality. And I'm just thinking about a response that you gave and you said it's not just inequality in terms of an economic sense, it's inequality in multiple dimensions at once. Because for those at the bottom, they have scarcity, scarcity in education, in health care, in child care, in job opportunity. They have what you termed stacked vulnerability where the economic piece is just one more thing. And at the same time, those at the top have an overabundance and everything. Power, money, influence, and so it's become very difficult for those at the bottom to ignore what's happening around them. It's also something that has accumulated over years. It feels like whether there were Republicans or Democrats in the White House are in charge in Congress. So is it going to take time for us to get, get this fixed or, or do the people like, I don't know, you know, I had a Brit say to me, you're a young nation, you're going to have some kind of uprising, a revolution. Like, I don't know how do you, I understand policymakers going at this, but it seems like it's a, it's a big task.

[Jacob Goldstein]

Yeah, I think those at the top ignore the impatience at the bottom. Time moves very slowly when you lack confidence. And I also think that those at the top are largely blind to the human experience at the bottom. And at the same time, those at the bottom, bottom are all too aware of the abundance that exists above them.

[Carol Massar]

Well said, well said. And I feel like there's a layer of social media here that also makes it a little tricky and certainly really puts it out there. Peter, thank you so much. Peter Atwater, President of Financial Insights, Adjunct lecturer of Economics at the College of William Mary, joining us from The Bloomberg Washington, D.C. bureau. He is the subject of of the Bloomberg Big Take, which talks all about the K shaped economy. This is the Bloomberg businessweek daily podcast available on Apple, Spotify and anywhere else you get your podcasts. Listen live weekday afternoons from 2 to 5pm Eastern on Bloomberg.com, the iHeartRadio app, TuneIn and the Bloomberg Business App. You can also watch us live Every weekday on YouTube and always on the Bloomberg Bloomberg terminal. In the heat of battle, your squad relies on you. Don't let them down. Unlock elite gaming [e-mail] Dominate every match with next level speed, seamless streaming and.

[Jamie Tarabay]

Performance that won't quit.

[Carol Massar]

Push your gameplay beyond performance with Intel Core Ultra processors for the next era of gaming. Upgrade to smooth high quality streaming with Intel Wi Fi 6e and maximize game performance with enhanced overclocking. Win the tech Search power [e-mail] lenovo Lenovo.

[Jacob Goldstein]

Running a business is hard enough. Don't make it harder with a dozen.

[Bob Michael]

Apps that don't talk to each other.

[Jacob Goldstein]

One for sales, another for inventory, a.

[Bob Michael]

Separate one for accounting. That's software overload.

[Jacob Goldstein]

Odoo is the all in one platform that replaces the mobile all CRM, accounting.

[Bob Michael]

Inventory, E Commerce, hr.

[Jacob Goldstein]

Fully integrated, easy to use and built to grow with your business. Thousands have already made the switch.

[Bob Michael]

Why not you try Odoo for [e-mail].

[Jacob Goldstein]

That'S odoo.com Ah, greetings from my bath festive friends. The holidays are overwhelming, but I'm tackling this season with PayPal and making the most of my money getting 5% cash.

[Carol Massar]

Back when I pay and 4 no fees, no interest.

[Jacob Goldstein]

I used it to get this portable spa with jets. Now the bubbles can cling to my sculpted but pruney body. Make the most of your money this holiday with PayPal. Save the offer in the app ends.

[Bob Michael]

1231 see paypal.com promoterms Points can be redeemed for cash and more. Paying for subject to terms and approval.

[Jacob Goldstein]

PayPal, Inc. And MLS 910457.