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- [00:00]
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.
- [00:14]
Sarah Levy
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- [00:44]
Host/Producer
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- [01:15]
Carol Massar
Bloomberg Audio Studios Podcasts Radio News this.
- [01:21]
Sarah Levy
Is Bloomberg businessweek Daily reporting from the magazine that helps global leaders stay ahead.
- [01:28]
Carol Massar
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 businessweek Daily Podcast with Carol Massar and Tim Stanweck on Bloomberg Radio. We do want to take you though back to what we just heard, that meeting between President Trump and the Mayor elect of New York City, Zoran Mandani. Obviously they talked a lot about the relationship between the federal government and New York. The president did also answer some questions on some of the geopolitical issues that are out there. But the net takeaway a range of questions and answers. But it does seem like these two individuals, I think some thought they might not get along. They definitely look like they got along.
- [02:11]
Host/Producer
Let's bring in Michelle. Jim Risko. She's White House and National Security editor down at our Bureau in Washington, D.C. i got to tell you, my phone is blowing up with text messages about how surprised people are listening to that press conference. Watching that press conference, Michelle, it seems like these two got along really well. What are your takeaways?
- [02:31]
Michelle Jam Rieko
Yeah, well, we knew it was going to be, you know, as Trump says, the best show on earth. We had hordes of media waiting for the arrival there and we were waiting to hear it confirmed and then waiting to get in to see exactly what the show would be about. But I think, yeah, in the end we were, we were joking on the earlier show what could possibly happen where they both come out of this happy but it looks like, to your point, they did agree on a number of things, and I think they both appreciated the opportunity to kind of pump their message and show the American public some sort of agreement across a vast political divide and also minimize those political labels, which I thought was funny. Came to humorous points at times with Trump saying Mamdani could just answer yes to the question of whether he still believed Trump was a fascist and not have to explain himself. So they were having a little fun with the media.
- [03:20]
Host/Producer
There were some funny moments in there.
- [03:21]
Carol Massar
There were a lot of funny moments. I think we were all just kind of shocked, you know, a show, yes, maybe the president, you know, promised. No one expected the bromance, though I think it's safe to say. And that's what it feels like. I mean, you could tell, right? You can read the room, read the chemistry. You know, I guess what's interesting is, and I kind of think, obviously you can't kind of maybe think about this, but if I went before the election or a couple of months ago, I can't even imagine this kind of warmth between these two officials. But I don't know, is it the individual, is it the charisma of the mayor elect? Is it that, you know, President Trump has been not winning everything as of late?
- [04:03]
Michelle Jam Rieko
Well, I think it's a combination of a lot of those things, Carol. I mean, we think about too, Trump's style of personal diplomacy, his idea that he could get along with anybody. You know, he often talks about being able to cut a deal with even who you might think is the most controversial figure, nevermind someone who he's had in the Oval Office today who is, you know, a very different political figure than he is. But I think. But one thing that he really respects, he really respects strength, confidence. He really likes the job that Mandani has. He joked about loving the idea of being New York mayor. Maybe we'll see a run for the president in the future on that. And he also respected someone who is very much vis a vis Trump, very much like Mandani in terms of Bernie Sanders taking the same kind of voters, cost of living, populist draw. So he sees some similarities there. And I think that was part of the show today, was like, let's show you where we can degree and like to the benefit of both of us politically. And then, you know, we'll talk about some substantive things and where we can come together on vast disagreements.
- [05:07]
Host/Producer
The president and I think there was concern going into this from, from New Yorkers who thought, okay, well, if the president chooses not to give federal funds to New York City, then New York City could be in trouble. The president said that if he, quote, didn't agree with New York City mayor like Zoran Mamdani, he wouldn't give the city as much federal funding. He said, quote, we had a meeting today that actually surprised me. He wants to see no crime. He wants to see housing being built. He wants to see rents coming down. All things that I agree with. Is it fair to say that Mamdani walks away and says this meeting was a huge success?
- [05:42]
Michelle Jam Rieko
Well, I don't know if you can say huge success. And of course, I think Mamdani is smart enough to think, you know, all these things can also tentative. You know, you could, you'd be friends and pals, seemingly with the president one day, and the next day you do something and he's upset and takes revenge in some way. And that's part of his, his unpredictability that he likes to play off of. To get leverage is the whole art of the deal. Right. So, but we did see, I mean, to your point, the housing and affordability conversations seem to be kind of coalescing around the idea that they both know it needs to go in a certain direction. And Mamdani is in some ways being trusted to, to take care of that without the threat of withholding federal funding, it seems. But, you know, we live to fight. And then on the crime side, which was a big sticking point, of course, for Trump, he seemed to kind of relent on that issue. He was asked if he would feel comfortable living in a Mandani New York City. He said absolutely. And he said, especially after today. So he's kind of playing up this. I've met with this guy. Now that I know him, things are just going to be fine. So I think this is kind of a down payment on a future relationship that could get rocky. Of course, you think of the likes of Elon Musk. We saw a great bromance, a lot of respect, and we've been on a roller coaster, coaster ride since then. So I can only imagine that could be the same for this relationship.
- [06:59]
Carol Massar
Although, Ellen, back in the White House, or at least back at a big this past week. Hey, Michelle, before you go, just two things I want to ask you. First of all, in terms of whenever any of this happens in the Oval Office, I think about policy and things that might impact the investment environment, the business environment, the Bloomberg audience, if you will. And Mamdani, the mayor elect, talked about very much interested in property tax reform. They both talked about housing affordability. They also talked about power rates, electricity rates. We saw Con Edison, which was cited specifically. I think them both calling on, and I think the president looking calling on Con Ed to cut rates. And Con Ed dipped as much as 1.4% on that news. How much of it should we think about is the potential for. Yeah, this is going to be future discussions that could ultimately result in some kind of policy or changes that impact the business environment here in New York City?
- [07:52]
Michelle Jam Rieko
Well, certainly an open question, Carol, and I haven't checked all the market metrics that you're mentioning, but, you know, I can imagine that the businesses that were nervous about certain things coming into today weren't maybe reassured just by the messaging that Mandani proposed. You know, maybe the spirit of it. Yes. But I don't think he changed a whole lot from what he's been talking about. So I think the concern might remain in terms of how he might go about this. And we didn't get much detail on that front, but the motive and the ideas behind it I think were consistent with what he said on the campaign trail.
- [08:24]
Carol Massar
Hey, one last question, because geopolitics certainly came up. The president did say that he thinks the Russia, Ukraine peace is getting close. I'm just curious. They also talked about that they both want peace in the Middle east, but Russia, Ukraine has certainly been front and center today. Some back and forth of things going on. You do cover national security here. I'm just curious. Anything that we need to know as we head into the weekend?
- [08:45]
Michelle Jam Rieko
Yeah, you know, it's really important and the bar is low today. We were trying to hear, you know, get some sense of how some conversations had gone today. We understand Mayor had spoken with TRUMP with that J.D. vance had spoken with Zelensky. And a lot of things have unfolded today that we still need to get follow up on. I think, you know, a few of his lines were pretty striking today that kind of pointed in one direction of putting the pressure and keeping the pressure on President Zelensky rather than Putin at the moment. You know, he said it takes two to tango and they both lost. He said 25,000 folks have been lost on either side in the recent period of time. So not very exact, but he's saying this is a pretty striking war. It remains one that needs to be resolved. But really kind of putting it in Zelensky's thought and saying he has to agree to something at some point.
- [09:30]
Carol Massar
Okay. Lots going on. Hey, listen so much. Thank you, thank you. You covered it all. Michelle Jam Risko there in our Washington, D.C. bureau for Bloomberg News. She is White House and National Security Editor Michelle have a great weekend.
- [09:42]
Host/Producer
Stay with us. More from Bloomberg businessweek Daily Coming up after this.
- [09:50]
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.
- [10:14]
Host/Producer
There's no championship league for small business owners, but if there was, you'd be at the top of the standings because going pro with Lenovo Pro means you've got the winning formation. One on one advice, device IT solutions and customized hardware powered by Intel Core Ultra processors help you stay ahead of the competition. Business goes pro with Lenovo Pro. Sign up for free@lenovo.com Pro. Hey audiobook lovers. This week on the podcast I'm sitting.
- [10:49]
Eric Weiner
Down with musician, producer and walking encyclopedia Questlove. We're talking about Mark Ronson's memoir, Night how to Be a DJ in 90s New York City. All right, like we talked about before, Mark Ronson found sanctuary in the DJ booth. 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.
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Host/Producer
We have the microphone that you hear as the audience. Then we have a second microphone in which we communicate with each other.
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Eric Weiner
I feel like that second microphone kind of saved all of our friendships. No band likes each other after 20.
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Host/Producer
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.
- [11:37]
Eric Weiner
Audiobook Club on the iHeartradio app or.
- [11:39]
Host/Producer
Wherever you get your podcasts.
- [11:48]
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.
- [12:02]
Host/Producer
Well, a volatile day of trading here in New York where we saw The S&P 500 down as much as a quarter of a percent, then up as much as 1.9% to close higher by 1% for the week though, down 2%. The Nasdaq down 2.7% this week. For more on the markets and the outlook, we bring in Eric Weiner, Bloomberg News Senior Editor, Equities America is also joining us. Sarah Levy, CEO of Betterment. Sara joins us from New York. Eric is here in the Bloomberg Interactive Brokers Studio. I want to thank both of you for just being so patient. Sarah, we were supposed to talk to you over a half hour ago, and you've been standing by, but you have been able to actually see this press conference between the President and the New York City mayor elect. You live in New York, you run a company in New York, you have employees in New York. So I imagine you are looking closely at the future of New York City. I'd be remiss if I didn't ask you, Sarah, your takeaways from this press conference.
- [12:51]
Sarah Levy
Well, it's interesting because I think affordability is obviously on everybody's mind, and I think that it was great to see sort of places of commonality, because I think if the, if the city is going to thrive, which I obviously have a vested interest in, I've been a New York City resident my entire life. If the city is going to thrive, we're going to need federal support. So I think it's really great the way they're reaching across the aisle to find areas of commonality. And I think, look, you know, keeping crime low is important. I think affordability is on everyone's mind. And even as I think about my business, not just running a business in New York, but we're, we're here to help people invest and, you know, build nest eggs and build wealth over time. If life isn't affordable, that's a really hard thing to do.
- [13:33]
Host/Producer
Eric, I want to bring you in here because you have to catch some of this press conference as well. And certainly Wall street and New York City are inextricably bound. And what happens in the market, a lot of that happens here in the city. You're a longtime person who's worked and lived in New York. Your views.
- [13:50]
Eric Weiner
Well, from a Wall street perspective, they've got to be happy. Because if, if we're fighting, if the city is fighting with D.C. that is just not good for business here and in particular, financial business here. So really what you want is sort of a friendly engagement with the White House. You want funding to be available, and you really want, as we were just talking about the, the affordability issues, the issues that they're talking about, development, getting more housing, getting more, getting affordability down, all of that is extremely important to the markets. And today was probably a pretty good development for Wall Street.
- [14:33]
Carol Massar
But I mean, getting housing prices down is important to the markets or you just mean that they're cooperating? Well, I don't know how much.
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Eric Weiner
I don't know how much. Yes, I don't know how much a politician can get housing prices down.
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Carol Massar
Right.
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Eric Weiner
What you can do though is spur building. And so if you reduce regulations and open up building in places where there hasn't been building, then suddenly you can get more units involved and you can get more people, rents come down. It's just there hasn't been a ton of building. There hasn't been a lot of development going on in New York. And if, if Mamdani can do it with the support of the President, that much better.
- [15:10]
Carol Massar
So Sarah, I mean, you know, let's talk a little bit about kind of how we wrapped up. I mean there's so much coming out. We spend so much time focusing on news obviously out of D.C. and you know, any time that there is some event from the Oval Office, like I mentioned, Con Ed, because he, the President and the mayor elect talking about getting power prices, electricity prices, rates down. And con Ed, we saw a dip on that. The environment in general. There's questions about the AI trade, what the Fed's going to do, kind of what do you think is most impactful and will matter to markets as we are almost ready to wrap up this year?
- [15:48]
Sarah Levy
I mean, look, there's a lot packed into that, I think, I think probably interest rates and the trade are probably the two biggest factors. And you know, the question on the both of those questions I think are open, which is you can see a lot of similarity to the dot com bubble right now in the trade. And you know, we're seeing that volatility sort of pre and post, the Nvidia earnings, you know, one day up, one day down. So, you know, I think there are really two sides of that debate right now about, you know, is it inflated, is there too much capex going in there and is there going to be an ROI or is there room to run and we're going to transform, you know, productivity across business. And I think there's really something to both of those, to both of those narratives. So we're seeing people somewhat confused and sitting a lot of money on the sidelines in cash because of that. So then enters the Fed conversation, right, where recently we've started to see more of a rotation out of cash into investing. But I think now we sit in this place where it's pretty split 5050 on whether or not the Fed's going to drop rates again because the economic signs are a little crosswise, a little confusing it.
- [16:54]
Host/Producer
Sarah, sit tight because I want to get back to what exactly is happening on the betterment platform in just a second. As you have increasingly focused, you know, people know it as a robo advisor, but increasingly now it's become this a different type of platform. And you're going to tell us about that and what people are doing on the platform. But Eric, I want you to weigh in on one of Sarah's points that she just made, which is this idea of whether or not we're in a bubble when it comes to AI and if there are parallels indeed to the dot com bubble.
- [17:21]
Eric Weiner
Well, there absolutely are are parallels. The question is where we are in that stage. Bubbles can run for a long time. We actually have a story running on Sunday from Bloomberg Business.
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Host/Producer
There's sort of a dichotomy right now after this.
- [17:35]
Eric Weiner
There's the glass half full, glass half empty argument where there are people who are looking at all the spending and saying, oh my God, they're not going to be able to pay this. And then you have other people saying, oh my God, look at all this money that's coming in. We're going to make a fortune. So really that is actually playing out real time. And that was really what caused the turnaround just yesterday where, you know, Nvidia came out strong. We knew they were going to come in strong. But when they came out strong and it looked like, okay, we're going to rip higher, and then all of a sudden there's this pullback because people start getting concerned. The undercover issue to me is the consumer. We're not talking about that. And if you look at the companies that are doing worse this year, it's the consumer discretionary index. And like we heard from Wal Mart did great that they're concerned. We heard from Target, they're concerned. Home Depot, Lowe's, they're concerned. If we're heading into Christmas and the consumer is not healthy, that isn't great for stocks. Like that isn't great for earnings. That isn't great for a whole bunch of things that we count as really the, you know, the tip of the missile when it comes to getting gains.
- [18:45]
Host/Producer
Well, Sarah, I saw you nodding there when Eric was talking about the consumer. Remind everybody who's on the betterment platform. My understanding would be these are people who have money to invest. So that puts in a different income spectrum than a lot of Americans, we should point out. But what can you tell us about what the consumer is doing on the betterment platform that would indicate to you how the health of the consumer is right now?
- [19:09]
Sarah Levy
Well, your point is really important about who we serve. So we do serve a millennial professional or a More professional Gen Z or sort of earlier in their wealth building journey, but important to say wealth building journey. Right. So typically our customers have lower debt, have six figures of income. So I'm not sure necessarily it's the pulse of sort of the, the common, you know, consumer who's struggling with, you know, what's my Thanksgiving dinner cost going to look like? That being said, a big part of our business is the retirement business. And you know, when people are struggling today, it's really hard to convince them to put money away for the future, even though it's very much in their best interest. And the 401k business is a huge part and we haven't really seen changes there. I mean we've largely, and granted we have, you know, folks who are employed, so that probably sets a different tone. But we do really see very, very consistent savings continuing in the retirement space. So that's good.
- [20:08]
Host/Producer
In other words, if you, a sign of stress would be if people pulled back on saving for retirement because they would, they didn't, they needed that money now to live because of some sort of job loss or something. And you're not saying that right now.
- [20:20]
Sarah Levy
It's not that we're not seeing any of it, but we're not seeing it at elevated enough levels for that to be alarming with our customer.
- [20:26]
Carol Massar
But this goes back to, you know, our earlier guests that we had on. And Eric, I want to bring you back Greg Dacko. He is chief economist at EY and he's got this whole concept of 3A's artificial intelligence. The spend that has driven asset price gains. And that has been great for folks who are in the stock market. And that's where mostly affluent customers or consumers, they're feeling wealthy overall and they're out there spending. But if any of that, they're so interconnected that if that starts to come undone, then we might have a problem.
- [20:58]
Eric Weiner
That's absolutely it. So yes, money is coming into the stock market and we've talked about this. K shaped recovery, right. And so yeah, you know, wealthier people are doing just fine. But if, if companies that are requiring, you know, that, that need spending to grow are not getting that spending even if it's at the margin. So it's 10% down, it's 15% down. That's enormous when it comes to investing. It also involves as, as we were just. It involves how much people are willing to put into the market. If you are concerned about maybe a bubble bursting and you're looking at your, your savings and you're saying you know, I really don't want to put this at risk. People pull back and what tends to happen is it happens very slowly and then there's a rush. So the concern is that people get scared and then all of a sudden, wham, we all pull back at the same time.
- [21:53]
Carol Massar
I want to ask both of you and. Oh, go ahead, Sarah, come on back.
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Sarah Levy
No, I was just going to say, Eric, just one thing to add to that because I agree with everything you're saying, which is I think where I is going to take the take jobs is just another kind of piece of that that we can't ignore, which is you're already starting to see cracks and you're starting to see, you know, a lot of the biggest companies pull back on employment because of AI. And so I think we have to keep our eye on that as well. While we're getting excited about the AI trade in terms of the efficiency it delivers.
- [22:21]
Carol Massar
You know what I want to ask both of you and Sarah, you know, remind me in terms of activity when it comes to crypto or bitcoin on your platform, because what's interesting is we've seen such a drop in crypto. We're now, you know, looking for the next key level for it to, to go down to is 80,000, finishing just below 85 or at least trading below 85 right now. But we have seen so much value, value. I put parentheses around it wiped off of bitcoin this year. And I'm just curious, is there a connection? I'm trying to understand because people sometimes want to make correction connections between crypto and the stock market. And are you seeing anything?
- [23:01]
Sarah Levy
So crypto is not a huge part of our business. We do have crypto portfolios on our platform, but we don't have the ability other than buying crypto ETFs really to directly buy crypto. And we also as sort of of part of who we attract. It's kind of a long term globally diversified investor. So I would say crypto remains, I'll call it 5ish percent of what we see. So I'm not sure we're really indicative of what's happening there. But I would say like we are seeing in general in the market that crypto is moving with the market as opposed to against the market at the moment. So whereas it used to be kind of a, you know, a contra trade, it's feeling a little bit like not so sure.
- [23:40]
Host/Producer
Sure. I'm so glad you brought up Bitcoin because that's where I wanted to go with Eric too.
- [23:44]
Carol Massar
Yeah.
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Host/Producer
And Eric, you know, we're looking at bitcoin hanging for its worst month since the crypto collapse of 2022. And whenever we're talking about the collapse of Do Kwon's Terra USD stablecoin back in 2020 to the downfall of Sam Bankman Fried's FTX exchange, you know, things are getting very crypto wintery. Is there contagion?
- [24:04]
Eric Weiner
What there is is how much?
- [24:07]
Host/Producer
Because Bill Ackman says, you know, Fannie and Freddie fell today because of exposure to investors who are exposed to crypto.
- [24:13]
Eric Weiner
That's.
- [24:13]
Host/Producer
I didn't see evidence from him, but is that right?
- [24:16]
Eric Weiner
Well, what I will say, I don't. Okay.
- [24:19]
Host/Producer
Just threw a lot at you. Well, no, no, no.
- [24:21]
Carol Massar
Everybody's making connections and I'm like, well wait a minute, we just threw a.
- [24:24]
Eric Weiner
Lot of Bill Ackman. I, I'm not going to draw any conclusions. But what I will say is that a lot of the money that is made off of crypto ends up going into spots. Ends up going into the market.
- [24:39]
Carol Massar
Yeah.
- [24:39]
Eric Weiner
So as people make their, make their fortunes on bitcoin and whatever and everything's been going up that's been helping to support investing.
- [24:49]
Carol Massar
So overall driver of momentum.
- [24:51]
Eric Weiner
Exactly, exactly.
- [24:52]
Host/Producer
Lambos.
- [24:53]
Eric Weiner
Well, but you know, when you've got a little bit left over, you throw it into spot.
- [24:58]
Sarah Levy
You're right.
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Carol Massar
So that's provided liquidity into other assets beyond crypto.
- [25:02]
Eric Weiner
Absolutely, absolutely. And that's the spinoff. So like when you have something that has gone up a zillion percent or whatever it is, and then all of a sudden starts pulling back and that asset class isn't necessarily in the equity markets, but it gets funneled into it. That has a big, big spending effect on what happens on Wall Street.
- [25:21]
Carol Massar
So you know, Sarah, we were with you in lovely California.
- [25:25]
Host/Producer
It was warmer than it is Huntington Beach.
- [25:27]
Sarah Levy
Wouldn't it be nice to be there now?
- [25:29]
Carol Massar
Yes, yes and yes, yes. What's changed since we talked in September?
- [25:36]
Sarah Levy
So we recently had a big sort of brand and business moment for betterment in the launch of self directed investing. For years we were sort of the original robo investor. And the idea there was that we managed people's money for them. And this generation has really come to the table with more of a desire to self direct and less of a sort of. There used to be kind of two archetypes of investors. One that wanted you to handle it for them and one that wanted to do it themselves. And we've seen like a real blurring of those lines. So we just released self directed investing so that we could meet our customers really where they are, which is very exciting for me. Although, you know, obviously places, places out there where you can self direct beyond betterment.
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Host/Producer
Do, do people want to self direct in a down market or was. Or do you see them wanting to self direct in a market that moves higher there? Does it change?
- [26:26]
Sarah Levy
Well, I mean, it's an interesting question, but that also assumes that it's a down market, you know, for good here, versus the volatility we're seeing. But, you know, look, I think what we've seen historically in our business is that when things are volatile and when there's a down market, that's when folks kind of run to the managed investment side because they realize, you know, this is a lot harder than I thought it was to do it myself. But I still think people want to mix. And I think what's changed kind of generationally is that people want to do some themselves and then they want to buy, put some on kind of autopilot. And we just want them to be able to do both of those things here. And whatever their mix is, we can meet them there.
- [27:04]
Carol Massar
You know, Eric, one of the things I always think about in any market environment is like, what are, what's the canaries in the coal mine? And we've been talking a lot about private credit this week. We've been talking about Blue Owl this week. And so far it feels like it's measured. But I also think of a name like in video that has struggled even after an initial rally, following earnings, even today after the government looking like, okay, maybe they could possibly, the US government allow Nvidia to sell some chips to China, which they haven't been really able to do, especially sophisticated chips. But this stock is down almost 6%, you know, this week alone. And we've definitely seen a pullback. What do you watch to get an indication of kind of where we go from here? What is it? What is that canary in the maybe equity universe? Coal mine or the US financial market? Coal mine.
- [27:57]
Eric Weiner
So often these things fall apart because of the credit markets.
- [28:01]
Host/Producer
And so Oracle, I was watching Oracle, right?
- [28:04]
Eric Weiner
Credit default, like, yeah, the credit swaps. So what. What we're seeing is much larger concern about AI spending because they're now using loans, they're borrowing money, they're issuing. Yeah, they're issuing debt, they're issuing bonds, they're borrowing. So it used to be that they were spending off of their balance sheets. And so the point was, all right, they have the capital and they're instead of buying back their shares or doing dividends or whatever and returning it to the shareholders, they're going to spend it on growth. Fine. But once they start going into the debt markets to raise that money now you have to, to first of all, you have to pay that back. So you, you raise expenses on the, on one side and then on the other side you really need to get that ROI going. You need to have the return on the investments. And that's what we're hearing is the question is when is the return on investment coming? And it becomes much more urgent as a question when you have debt behind it as opposed to it's just coming off your balance sheet.
- [29:05]
Carol Massar
That's right, right. There's a whole other layer of invest.
- [29:07]
Eric Weiner
So that's the canary.
- [29:09]
Carol Massar
Well, Sara, come on back in because, because what you guys do see on the platform, it's one of the reasons we love talking with you is just like, you know, you talked about that new money still coming in, nobody stopping in terms of 401k investing. But are people moving things around like where are you seeing, you know, flows? You have a lot of data in front of you.
- [29:25]
Sarah Levy
Yeah, so we're definitely seeing a rotation from cash into investing. So that has been probably a couple of months now of that. Again, think of our investor typically as being a globally diversified investors are not looking to do, you know, do a lot of movement. But interestingly with self directed investing, I mean it's been launched a week. So take with a grain of salt the amount of data we have, but we're actually seeing our investors going into index funds and the mag7 like the mag7 exactly what you would have expected from long term folks. And you know, to the point earlier that Eric made about like, you know, about the consumer staples versus the tree trade, like we're really not seeing a lot of action on the non, sort of the non trade.
- [30:09]
Carol Massar
Hmm.
- [30:09]
Host/Producer
So what does that indicate to you?
- [30:12]
Sarah Levy
It indicates some amount of confidence I think in, you know. Yes, I take with a grain of salt that, you know, there's going to be a depreciation cycle and folks are taking on debt. But the reality is AI is more transformative than anything we've ever seen. And it strikes me that the average investor, or at least our investor currently believes that there's still room to rise up.
- [30:32]
Carol Massar
Final thoughts. We've got to wrap up and we.
- [30:34]
Host/Producer
Thank you both for spending so much time with us.
- [30:36]
Carol Massar
It's been one of those even before.
- [30:38]
Host/Producer
We went to air.
- [30:38]
Carol Massar
For us it's kind of normal, the interruptions. But we know for you guys, we really appreciate it. Before we go, final thoughts. Eric, let me start with you. A week, we have a holiday certain week next week. I don't know how are you thinking? We're waiting for a Fed meeting. We're pretty much done with earnings. Like what?
- [30:55]
Eric Weiner
The Fed meeting is really interesting. Interesting. We were down basically to 30% odds of a cut. Then Williams talked today and now suddenly we're up over 50%. I think that there will be some real concern if, if they don't cut and I don't know really where they are on that. So that's really what we're looking at. And then there's Black Friday in the Christmas season and these retail earnings coming forward and their outlooks are very concerning. And it's really, it's the discretionary guys. It's where people don't have to spend.
- [31:28]
Carol Massar
But it was interesting. Like you said, as they reported, even Wal Mart, who had good results, were talking about consumers being cautious. And I think they said across the board, Sarah, final thought to you as we wrap up on this Friday.
- [31:41]
Sarah Levy
I mean, I would just say I hope that the, the holidays are strong for everyone and that, that we can make it, we can make it through with some positive momentum.
- [31:50]
Eric Weiner
Him.
- [31:50]
Carol Massar
All right, I like that. I'll take that ahead of the weekend. Hey to both of you, Sarah Levy, of course, she's the CEO of Betterment joining us right here in New York City and our own Eric Weiner, Bloomberg News senior editor, Equities Americas. Look for all of the reporting from he and his team because they do put a bunch of stuff out over the weekend.
- [32:09]
Host/Producer
Stay with us. More from Bloomberg businessweek Daily. Coming up after this, pro drivers live for race day, but for small business owners, every day is race day. That's why going pro with Lenovo Pro matters one on one advice IT solutions and customized hardware powered by Intel Core Ultra processors. Keep your business on the right track. Business goes pro with Lenovo Pro. Sign up for free@lenovo.com Pro Lenovo, Lenovo. Hey everyone. Ed Helms here and hi, I'm Kal.
- [32:51]
Eric Weiner
Penn and we're the hosts of Irsay.
- [32:54]
Host/Producer
The Audible and iHeart Audiobook Club. This week on the podcast, I am sitting down with Jenny Garth, host of the iHeart podcast.
- [33:03]
Eric Weiner
I choose me to discuss the new.
- [33:06]
Host/Producer
Audible adaptation of the timeless Jane Austen classic Pride and Prejudice. This is not a trick question. There's no wrong answer. What role would I play?
- [33:17]
Carol Massar
You know what? I can see you as Mr. Darcy. You got a little Colin Firth.
- [33:23]
Eric Weiner
Okay, that's really sweet.
- [33:25]
Host/Producer
I appreciate that.
- [33:26]
Eric Weiner
But are you sure I'm not the dad?
- [33:29]
Host/Producer
I'm not Mr. Bennet Here listen to Irsay the Audible and I heard iHeart.
- [33:35]
Eric Weiner
Audiobook club on the iHeartradio app or.
- [33:38]
Host/Producer
Wherever you get your podcasts. The world is buzzing with AI tools. But instead of making things easier, they've made things overwhelming. There's a better way. Meet Superhuman, the AI productivity suite that gives you superpowers so you can outsmart the word chaos with Grammarly, mail and coda. Working together, you get proactive help across your workflow. No matter how you work, experience AI that meets you right where you are. Learn more@superhuman.com podcast that's superhuman.com podcast.
- [34:14]
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. Charlie pellets usually flying all over the world.
- [34:30]
Michelle Jam Rieko
World.
- [34:30]
Carol Massar
I don't know that he's going anywhere this Thanksgiving.
- [34:32]
Host/Producer
He was last on a 747.
- [34:34]
Carol Massar
He was?
- [34:34]
Host/Producer
Yeah, just a few days ago.
- [34:36]
Carol Massar
Check out his Instagram feed. It's a lot of fun to track where he is. It's kind of like where in the world is Charlie Pellet? Because he goes to some pretty cool places and and loves planes, as does this one.
- [34:45]
Host/Producer
Well, speaking of planes, 14 years in planning and prepping, the construction and this week's opening of a new terminal just ahead of the start of the all important holiday travel season. We're talking about the Pittsburgh International Airport. Airport just went through a major overhaul. Overhaul. A price tag of roughly between 1 and a half to 1.7 billion more than initially expected. Here with us to talk about it all, Christina Cassotis. She's CEO of the Pittsburgh International Airport. Christina, good to check in with you. We're going to talk about the opening. We've had you on a few times in the last few months as you've gotten ready for this. We're going to talk about that in a minute. But first I just want to check in on capacity right now ahead of next week's holiday. What are you seeing at Pittsburgh International Airport, especially in the context of, well, flights being back at full capacity after that government shutdown.
- [35:32]
Christina Cassotis
First of all, thanks for having me on. It's always a pleasure to be here. And what we're seeing is that people are traveling and that travel is strong, demand is strong. We are expecting record numbers for the Thanksgiving Holiday, as everybody in the airline industry is for Thanksgiving this year. So we're ready.
- [35:53]
Carol Massar
You're ready. Well, you've got a new terminal for them to go through. Tell us a little bit about. And I wasn't sure. Was it one and a half, one and 1.7 billion? I think the initial thought was to be about 1.1. Tell us about the cost and tell us about the upgrades.
- [36:08]
Christina Cassotis
Well, first of all, 1.1 billion was the estimate at 0% design. That was never a budget budget. Okay. So let's just be clear about that. But I appreciate you. You asking the question, kind of what.
- [36:19]
Carol Massar
I tell my husband when we're doing kind of a rehab.
- [36:22]
Michelle Jam Rieko
Money.
- [36:22]
Carol Massar
That was before. I'm just kidding. I'm just kidding.
- [36:25]
Sarah Levy
That's fine.
- [36:26]
Christina Cassotis
Just say that was a zero percent design. I didn't really know what we were buying then. That's fair. So, yeah, the final cost came in at 1.7 and we needed it. It has been a huge. That was for a terminal, a new garage, a new roadway system, a new customer service service building where our rental cars are housed, and a whole lot of upgrades. So it's been fantastic. And we opened on Tuesday, November 18th. We switched over from Monday the 17th. A lot of planning went into it, and it was a seamless opening. We're really so proud.
- [37:01]
Host/Producer
How does it improve? Not. Not just, you know, the customer experience at airports is important. And it's. No, it totally is.
- [37:09]
Carol Massar
I love airports.
- [37:12]
Host/Producer
You and I have been to some places that need upgrades.
- [37:15]
Carol Massar
Yeah, exactly.
- [37:16]
Host/Producer
We have. But, you know, we know it pretty well here in New York because LaGuardia has, you know, it went from being this pariah.
- [37:21]
Carol Massar
Yeah.
- [37:22]
Host/Producer
When thinking about airports to being a place that you really want to fly out of.
- [37:25]
Carol Massar
Yeah, exactly. And it does make. It does change Newark the same thing. They've been redoing things. I mean, tell us a little faster at Newark.
- [37:32]
Christina Cassotis
I'm just gonna say it makes a difference. Listen, you know, and you know this. You travel airports. I always say airports are portals. You're going through them in order to go to something or from something that was really important to just you. It matters that the experience is good for you, that you can move through it without a lot of stress, and that when something goes wrong, it can get fixed. And so infrastructure has a surprising impact on how people feel about the space they're moving through and the certain services that we can provide in that space. So I'm really happy to hear you all understand that passenger experience is important. We understand it. Airports Understand it. And I think we're all getting a lot better at providing it in ways that really deliver value for passengers and staff and meters and greeters and partners, everybody who relies on the airport. So, yeah, that's what we built and that's what we opened and that's what we're excited to have people traveling through this holiday season and beyond.
- [38:30]
Carol Massar
Hey, Christine. The thing I care most about is it all being safe. I'm cool going through tsa. If I have to take off everything, I'm fine if that means I'm going to be safe. But I. Not really. But I'm just saying I appreciate those agents that were working during the government shutdown. Same thing with the traffic controllers. And I think that is something that Bloomberg has reported a lot on about the lack of air traffic controllers that are out there and what's required for one to be one and so on and so forth. Tell us about that at your area airport, what you're seeing, what could be better, what still needs to be done.
- [39:05]
Christina Cassotis
We, I love that you brought this up. So we, we believe strongly that if you don't get safety and security right, nothing else matters. I do want to point out that in that $1.7 billion worth of build, there was no loss of life. And I say that because when the original airport was built, three construction workers lost their lives building it. So having an owner's controlled insurance program, delivering a safety program for the construction while we operated safely and security securely was job one. Every day. Our TSA partners, Customs and Border Protection partners and air traffic control partners, we actually did not see major call offs ever during the shutdown. We have an incredibly dedicated team out here. We have lots of people who helped out in making sure that they had had food and diapers and baby formula and stuff that they could help their families with. We had the food bank held a food drive, which we helped support. So there was a lot of care and taking care of our federal partners. We reminded people every day to thank them. And we have had a very good partnership throughout the shutdown as we were getting ready to open. And I think that's a real time testament to the dedication that they have to their jobs out.
- [40:26]
Host/Producer
Yeah, I want to go a little existential with this because, you know, during the shutdown I was thinking, why is the FAA the employer of all air traffic controllers? Like, why aren't they employed by the individual airports where they work or the territory they're responsible for? In your view, is this, is this the right way to have a centralized database or decentralized entity pay them and have centralized standards. Like, is this the right way to do it?
- [40:53]
Christina Cassotis
Yes, but I'm not sure that it should be. I think that there might be something to be said for how we take it away from the, how we take it away from the continuing resolutions. In other words, how do we make sure that they never have to shut down? Okay, so, yes, I think, you know, you need the, you need the consistency in the handoff from tower to tower. You want the same standards. I believe in that. And I also think that the FAA does a remarkable job. They have a huge mandate and there's a lot at stake for the work that they do. But I think that what we see is with the aging technology and some of the infrastructure that it would be more beneficial if we could get those solutions, you know, invested in faster. And that can't happen if you're subject to. Yeah, if you're subject to congressional budgets and stuff like that. So I think that there are other solutions that we can explore that have been successful in other countries.
- [41:50]
Carol Massar
Christina, just 20. No, 15, 20 seconds. We need more air traffic controllers, just quickly.
- [41:56]
Christina Cassotis
Yes, of course we do. And we need more of them. And yes, we do.
- [42:02]
Carol Massar
All right. Are you flying this holiday season?
- [42:06]
Christina Cassotis
I am flying this holiday season, but I want to say that the skies are safe and the air traffic control who are doing their jobs are doing a great job. We just, we constantly need new entrants so that as people retire, we are replacing them.
- [42:20]
Carol Massar
All right, Amen. Have a good holiday season. Christina Cassodis, CEO of Pittsburgh International Airport. This is the Bloomberg businessweek daily podcast, available on Apple, Spotify and anywhere else you get.
- [42:33]
Sarah Levy
Your podcasts listen live weekday afternoons from.
- [42:37]
Carol Massar
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 terminal.
- [42:57]
Host/Producer
There's no championship league for small business owners, but if there was, you'd be at the top of the standings. Because going pro with Lenovo Pro means you've got the winning formation. One on one advice. IT solutions and customized hardware powered by Intel Core Ultra processors help you stay ahead of the competition. Business goes pro with Lenovo Pro. Sign up for free@lenovo.com Pro Lenovo Lenovo Binge Listen this and all your artist stations, plus any song from our library of millions of songs, all ad free. Get your free 30 day trial of iHeartRadio All Access. You'll love it. Don't Be basic, be extra. Start your free 30 day trial of iHeartRadio. All access now.
- [43:43]
Sarah Levy
You know what a girl's best friend is.
- [43:45]
Carol Massar
Not diamonds. Her lawyers.
- [43:47]
Host/Producer
From executive producer Ryan Murphy comes a.
- [43:50]
Eric Weiner
Fiery new legal drama.
- [43:52]
Carol Massar
It's our own boutique women representing women.
- [43:55]
Eric Weiner
You can't afford to miss.
- [43:57]
Christina Cassotis
Make it rig.
- [43:58]
Carol Massar
Showtime, ladies.
- [44:00]
Sarah Levy
Stand up straight and ready.
- [44:02]
Carol Massar
Breeze into that room like a storm no one saw coming.
- [44:07]
Eric Weiner
Hulu Original Series All's Fair now streaming on Hulu and Hulu on Disney plus for bundle subscribers terms apply.