Loading summary
Transcript133 lines
- [00:00]
A
Foreign. Hello, welcome to the Seamless is a Verb edition of Slate Money, your guide to the business and finance news of the week. I'm Felix Salmon of Axios. I'm here with Anna Shymansky of Breaking Views. Hello, I'm here with Emily Peck of HuffPost. Hello, Emily, have you been seamlessing?
- [00:32]
B
Well, where I live there are only two restaurants on Seamless, so no.
- [00:38]
A
So no. Anna, have you been seamlessing?
- [00:40]
C
I have. Yep. There are more than two restaurants in Brooklyn.
- [00:44]
B
Really?
- [00:45]
A
We're going to be talking about seamlessing, or as the rest of the world knows it, ordering food online for delivery, which is a big business these days for obvious reasons. And it could be consolidating. We are going to talk about short people and what to do with them when we go to work and the whole economics of childcare. We are going to answer even more questions. Some of you may know we did a Facebook Live for Slate on Wednesday evening. It is still up on Facebook and if you want to watch it, you can. And there's a link in the notes, but where we answered a bunch of questions of people who were on Facebook, but there were other questions which we did not answer. So we will answer some of the other questions that people did ask but that we did not answer. We love answering questions on this show, so send them in if you have any questions. We will put a little bit of the Facebook Live show into Slate plus as our Slate plus segment this week. All that coming up on Slate Money. So let's talk about Uber and grubhub. Uber. We all know grubhub. I think many of us have become much more familiar with over the course of this lockdown. And Anna, is Uber going to buy GrubHub?
- [02:07]
C
Well, in theory they want to buy GrubHub. Whether or not this passes through the government's different regulatory bodies is a very different question.
- [02:17]
A
So is this, is this something? Tell me a little bit about where you see the US Government on this kind of thing. Obviously, Uber and grubhub are dominating that whole last mile service for restaurants who need to be delivering food these days because they can't be serving them in situ if they merge. That's basically the two biggest companies in.
- [02:42]
C
This space merging right outside of DoorDash. Right.
- [02:46]
B
They. So I looked at a couple of estimates. The Journal said the two combined would be 55% of food delivery. And then another estimate had that percentage even higher. And yeah, DoorDash is the number one operator in this space.
- [02:59]
C
And one of the interesting things is it's kind of bifurcated depending on where you are in the country. So like, if you're in New York, we tend to always be using like seamless slash grubhub.
- [03:08]
A
So a little known fact for those of you in New York, like seamless is a verb. In New York, everyone just uses seamless. But seamless is grubhub. It's the same thing. It's just a re. It's like a reboot. What's the word? Rebadged version of grubhub. So in any case, you know, we would wind up with monopoly power on the part of uber grubhub combo. They would have more than half the market. Probably at the very best we would be in a duopoly situation between them and doordash. So how is it even conceivable that regulators would allow this to happen?
- [03:43]
C
I mean, I think it's incredibly unlikely. However, I mean, there might be some thought that like, look, we going to be going through a really difficult period. Delivery is notoriously a business where you cannot at this stage make money in. All of these companies are losing money. So there may be the thought of like, look, if we can at least have this one company take over this other company, then at least they have a better chance of actually being able to survive as opposed to just all of them going out of business. I'm sure that would be part of the argument they might make.
- [04:11]
A
So. Okay, let me, let me unpack that a little bit. Because the reason why you are more likely to be able to survive if you're bigger is just that you have more pricing power and you can raise your prices and that the restaurants don't have a lot of choice about how much to pay you. So it certainly doesn't benefit consumers and it certainly doesn't benefit restaurants to give all of this pricing power to one or two companies. But you're saying that on some level, like the competition, regulators might say that it's okay because that means that we have companies doing this at all.
- [04:54]
C
I mean, as I've said, I don't think that is going to happen. But if I'm trying to make an argument of where I think you could get this through, it would probably be that idea of like, look, if you don't allow these companies to merge, at least one of them is probably just going to, you know, potentially go under, not be able to survive a number of years, especially if their access to capital dries up. So let's at least allow them to form a stronger unit and to be able to survive this.
- [05:19]
A
So we all agree that this is a very weak argument, and even as I'm making it compelling. So explain to me, given how weak this argument is, why did grubhub's share price rise so much? Isn't the market, on some level, pricing in a successful acquisition of grubhub?
- [05:39]
C
Yes, it is. I would say. It's just. It's not entirely rational. Yes, I mean, I think a, everyone's just as excited that there's any type of deal because we've been in this kind of deal drought for so long. And I think people stepping away from the regulatory side of it will say, oh, well, this makes so much sense. They'll be able to eliminate all of these customer acquisition costs. The logistics of Uber are so much better than that of grubhub. So this will make, again, allow them to reduce costs. And look, maybe that's the other argument you could make is say, you know, yes, you are going to have more monopoly power. However, maybe it won't hurt consumers. Again, I don't think it's a good argument, but maybe it won't hurt consumers because you'll be able to cut costs in all of these other ways. So consumers might actually get a better product by combining these two forces.
- [06:24]
B
I was going to make that argument because I saw a lot about Uber's amazing logistics, which at first I felt I intuitively understood, and now think I don't really know what that means actually. But anyway, according to reports, Uber's logistics are so good that they would save like 2 to $3 per order. Theoretically, that would go back to consumers, but unlikely because we know how these things kind of go.
- [06:49]
A
The logistics being this, the way that Uber has drivers driving around everywhere at all times. So if a restaurant says like pings, presses a red button and says, I need someone to pick up an order, then there will be someone right next door to that restaurant who can pick it up and deliver it.
- [07:07]
B
Excellent logistic analysis.
- [07:09]
A
Do we have a feeling? I don't have a feeling for this at all, but do we have a feeling for how many Uber drivers? Are Uber Eats drivers? Is it basically exactly the same people?
- [07:18]
C
You know, I don't have that number off the top of my head. I imagine that there's a, you know, I imagine it's not all of them, but I imagine significant, significant portion.
- [07:28]
A
I mean, it does strike me that during the pandemic, a bunch of drivers would be much happier to be purely Uber eats than to have human beings in their car.
- [07:40]
C
Yeah, and I mean, and Uber Eats has been one of the few somewhat bright spots for Uber. Now granted, they still lost a lot of money, but still at least their revenues were up significantly. So, you know, I can understand maybe Uber, again, trying to make this argument about, you know, whether it will make these companies stronger, more apt to survive this pandemic, more apt to survive this economic downturn. And on the other side, well, look, as you said, like, this might actually be better for consumers. Maybe they won't see all these price increases.
- [08:09]
A
I'm conflicted about this just because grubhub is kind of evil in a bunch of ways. They've been doing all of these nasty things about setting up fake websites for restaurants and setting up fake phone numbers for restaurants that you think you're calling the restaurant directly. And in fact you're calling grubhub, which means that grubhub gets to take a higher share of the order. And the amount of money that Grubhub charges restaurants, it's just nosebleed. It's like upwards of 30%. And while that can be considered, you know, well, at least it's extra revenues during good times over and above all of the, you know, normal revenues that we make from eat in diners right now. That's all, that's the only game in town. And, and it just makes the economics of restauranting, like, even more forbidding than they are already, which is obviously extremely forbidding.
- [09:05]
B
I mean, on the one hand, it's kind of like, it's good. It's kind of like a backdoor bailout for Uber right now if it gets more power in the food delivery space. Because that's the only space where in the foreseeable future it's going to have any ability to, like, really do business. And we know eventually Uber will, will come back, right? I mean, people will eventually start doing ride sharing again. So it, it needs some kind of bailout. So it's like, why not do it this way? Also, it seems like this is the food delivery. Like none of these, like I think Anna just said, none of these companies make a profit anyway. So something has to happen in the industry to move it forward and there has to be some kind of innovation that takes place now, especially considering what you said, Felix, about, you know, running a restaurant right now isn't like the thing to do that makes money really anymore. So there's obviously going to have to be lots of innovation in the space. So maybe it's a good thing if there's a bigger company with More money that can do more of the innovating. Yeah, I don't know. I'm reaching here.
- [10:06]
C
No, but I mean, I do think it's an interesting point as we think about restaurants moving forward, as we think about how people get food from outside their homes moving forward after this pandemic, because, you know, this is an industry that fundamentally cannot survive with competition. You just lose so much money in this delivery space. So it's hard to imagine how you can just kind of continue doing that indefinitely. And then on the other side, if you have the restaurants themselves kind of getting harmed by this, again, it's like, okay, well then where are they getting their supplies? So it's somewhat hard to imagine how this entire model moves forward without there being some dramatic change.
- [10:45]
A
One of the things which I don't like about this idea of thinking of delivery as a space, as a business in its own regard, as opposed to just like another service that is offered by restaurants, is the way that grubhub in particular is almost blackmailing restaurants into using their service. So, you know, it wasn't that restaurant, like, there was a time before restaurant delivery services. It wasn't that long ago. And restaurants would still deliver food, and if you wanted them to deliver food, you would phone them up and they would deliver you the food. And yes, they would have to pay those people, but they would be, like, on the books of the restaurant. And then grubhub comes along and says, listen, you don't need to pay delivery people because we will give you the delivery people and we will do the delivery for you. And the restaurant goes, oh, that sounds good. Is it cheaper? And grubhub goes, no, it's actually more expensive. And the restaurant goes, well, why would I sign up with you in that case? And grubhub says, well, because we're a discovery mechanism that people don't just want to order from your restaurant. They're just going to open up our app and type in Gaitom Car or whatever it is that they wanted to order. And if that's what you. If that's what you want, you know that's what you want. I don't know. I feel like Gaiton Car is like a classic takeout order. I might be wrong about this, but, like, you know, but if you're a restaurant offering Gaitamka, then they will discover you, and that's going to be extra business for you. And that will justify the fact that it costs more to use us to deliver your meals than it would be if you just did it yourself. But of course, this is a zero sum game, right? The total number of people ordering doesn't go up significantly just because an app exists. The total number of people ordering is just a function of how many people want to order in the first analysis. And so what you wind up with is a bunch of revenue ultimately just being siphoned off to the parasites rather than staying in the restaurant industry where it belongs.
- [12:56]
C
So I mostly agree with you, but I would say two things. One, the easier you make it for people to get delivery, the more people who are going to use delivery services. I wouldn't say. I think far more people are using delivery services now than they did back in the day when you had to find restaurants. And I do think that looks. You're not wrong that it's not good for restaurants right now. But I also feel like we're not going to go back in time. Like, you know, people want to use a single app where they can find restaurants. So I think moving forward, there has to be some way to figure out a model that works so that restaurants and these intermediaries and consumers kind of works for everyone to a certain extent.
- [13:31]
B
Also, I would just say, like, there was no, like, halcyon days for the people doing the delivering. Like, as though when they were the restaurants, they were so well treated like.
- [13:40]
A
The actual human beings doing the delivery. They've never been, well, dude, by grubhub, by the restaurants, or by anyone horribly.
- [13:48]
B
They would pay you pay them. I remember when I worked in the restaurant, they were paid like, tip, minimum wage, and they would go out in the hail and the snow and the rain hoping for like five bucks on a delivery mate or two. You know, like, it's not like they are the one great job before on this stuff.
- [14:04]
A
They are the one group of people who are actually winning here that people tips are up like 90%. Keep on, keep on tipping. Well, people that, you know, these people are out, they're frontline workers. They deserve all of the tips they're getting and then some. So if you do order for delivery, which is a perfectly reasonable thing to do, just make sure you tip. Emily.
- [14:29]
B
Hi, how are you?
- [14:30]
A
We've talked a bunch about restaurants on this show and how doomed they are. But it is not the only industry which looks like it could get completely decimated in a way that, like, large chunks of it might never come back. You have been looking at child care.
- [14:49]
B
I have, Felix.
- [14:50]
A
So tell me everything. It's something I have not been looking at. Tell me, tell me about how does the child care industry work and what is in its future?
- [15:01]
B
I'll tell you. So I have a piece hopefully coming out. It should be out right now. Basically, the child care industry is on the brink of collapse. And it's this really interesting business sector of our economy. 90% of child care operators are privately held. It's mostly people running centers out of their homes, you know, on like, razor thin margins. No one can pay very much for childcare. So, you know, they don't have a lot in the. It's just like restaurants. They don't have a lot of cash reserves or anything like that. And when the pandemic hit, like, around 60% of centers closed down completely, so no more money coming in. And yeah, some parents kept paying, but most parents didn't. So they were. They're basically just like, holding on by their fingernails. Meanwhile, there are these operators that are open now that are serving the children of essential workers, but they're not. They don't have as many kids as they used to. It's fewer kids coming in and costs are much higher now because they have to do all these, like, pandemics, screening things and buying more supplies and more cleaning. They have to have lower child to adult ratios. So costs are up and revenues are down. And some estimates say, like, it's going to take, like, it's going to. It should cost like nine and a half billion a month to keep these. The whole sector kind of alive during this. And Congress just is not giving them the money they need, which is very typical of this industry, which is. It's absolutely essential. Right, because parents need to. As we've all learned, parents need childcare so they can do their jobs and work. But historically, like, it's just been very underfunded. And if you think about it, like, in contrast to K through 12, it's. It's private and it's just really operating by the skin of its teeth. And now, like so many things, you know, it's very vulnerable to collapse.
- [16:57]
A
So can you just like, rewind a little bit and explain what exactly we're talking about when we're talking about childcare here? Because obviously the first main childcare service is schools, right? That's where you drop off your kids in the morning and then the school kind of looks after them and then you get the kids back in the afternoon. But yes, beyond schools, what are we talking about? Are we talking about the kids who are not old enough to go to school?
- [17:23]
B
Yes, Felix, we are talking about 0 through 5. Those kids, kids that are Babies. You can't drop a baby off at school. You have to. These are, they usually call daycare centers. Right. It's places where you drop your kid off and then you go to work and your kid is again a baby or a toddler. It's daycare. Right. A lot of countries have public daycare and New York City has public pre K which is four years old. So you can drop your kid off when they're four. But before that, parents have to pay out of their own pockets to figure out what to do with their kids so that they can go to work every day.
- [17:58]
A
And it's these kids should just be older. That would solve the problem.
- [18:02]
B
You should just leave them at the.
- [18:03]
C
School and let them figure it out.
- [18:07]
B
Yeah. So it's a big problem because there was like an effort decades and decades ago to make it all public, but that failed because conservatives were like, you know, women should do that work. So now we have this like mishmash private industry kind of chronically underfunded. Teachers make almost nothing. They make an average of like $11 an hour. So it's kind of a big mess. And this whole crisis has exacerbated the mess because it's only surviving because they have a constant flow of kids coming and paying tuition. And now that that's stopped, it's like, like gasping for breath.
- [18:42]
A
Yeah.
- [18:42]
C
And I imagine you might have some of the, like the pricier places actually stay in business. And I say this only frankly, anecdotally from like relatives who are paying because they don't want to lose the spot for their child.
- [18:55]
B
Yeah, you're absolutely right.
- [18:57]
C
You know, however, as you said that that's not a, that's not the majority. The majority are just these kind of like tiny little places. But I imagine a few of those. So it'll probably then kind of. And one more thing that kind of exacerbates inequality where people who are wealthier might still, once this is all done, have a place they can go that still is functioning, they can pay for. But then all of these, the less expensive places might all go out of business.
- [19:18]
B
Yeah, Like I spoke to one guy who operates a center in Bethesda, which is relatively upper middle class, charges like a thousand ish a month to parents and he's probably going to be okay. A lot of them are still paying. Spoke to a woman who operates a center out of like her house in Alabama and all the parents that aren't going, they're like, we're not paying you and could you hold our spot? So it's just a nightmare.
- [19:43]
A
So restaurants have this problem that it costs a lot of money for them to reopen. You can't just like wake up one morning and say, I'm going to reopen. You need to really reinvest in rearchitecting the restaurant, making it Covid proof and buying all the new food and training up all of the people who you have to replace the people who disappeared. Is daycare the same way? Like can you just, like a clothes store can just unlock the front door and it's basically back up and running? Like, where does, where does daycare fall on that spectrum? Does it, is it hard to reopen or is it easy to reopen if you want to reopen?
- [20:23]
B
I don't think it's as hard as a restaurant. But the people I've been speaking to say there's gonna have to be like a lot of retraining that happens, a lot of deep cleaning that happens, and a lot of reconfiguring, like class sizes. The new regulations make them smaller. So it's on the spectrum. It's not as easy as like reopening the Old Navy, but it's not. And not as hard as like reopening prune in the East Village, I guess. But yeah, like there's a lot that has to happen before the, some of these places can reopen and they have to find their workers again.
- [20:56]
C
Yeah, it does seem like the, you know, you don't think of this as like a capital intensive business, but like it is interesting. I'm just thinking of, you know, there's those videos kind of out of China of like this 10 minute thing that these children had to go through of all these different cleaning machines to like, you know, they were very adorable little children, but it was kind of terrifying. And I mean, I don't know if we'd have that love in the United States. And obviously it probably depends on how long before there's better either vaccines or treatment or whatever. But it does seem like as you say, that for a significant period of time, potentially, you know, you're going to have to spend a lot of money to be able to even open the, you know. So I wonder then, what are the options going to be for people who can't afford these types of places that have the ability to pay for that, you know, what are going to, what's going to be available?
- [21:38]
B
I mean, I think what you're already seeing is like a lot of people aren't going to be able to go back to work. Like a lot of particularly a lot of women, they're just not going to be able to work if these. If these centers close down. Right.
- [21:50]
C
And this is something that, like, it's. It's like, eternally frustrates me because, you know, people on the right who, you know, are always talking about, we want more GDP growth, blah, blah, blah. You talk to any economist, they'll tell you one of the best ways to do that is to get, like, more women involved in the labor market. It's one of the easiest ways to kind of increase GDP growth. And yet, like, this is such an important part of that at, like, every level, whether you're talking from low income to high income, and yet continues to, as you say, fall into, like, the same weird argument you got from, like, the 1970s of people being like, well, you know, that's really either a private issue or, well, maybe women should just be doing that themselves.
- [22:26]
B
Yeah. And I don't think the industry gets a lot of respect. You know what I mean? It's a race to bail out the airlines, but not to bail out childcare. They're basically begging for money at this point. And if you think about it, like, the industry itself, they lost, like, 330,000 jobs in April, which is a lot of jobs. Right. But, like, if you think about each childcare worker herself is supporting, like, five other people with jobs. You know what I mean? Like, without that one worker, those five kids can't be cared for, which means that whole set of parents can't go to work, or at least half, you know? You know what I'm saying? So it's like for every one childcare worker, there's like, six other people standing on her shoulders.
- [23:10]
A
The other reason why restaurants are so endangered is that they are generally like mom and pop businesses, that the owner only owns one restaurant, and therefore it's small and has no access to capital markets. I'm assuming childcare is the same. There aren't really big national giant childcare chains.
- [23:32]
B
Yeah, it's almost 90%, like, privately owned and mom and moms usually. But there is this one public company called Bright Horizons. Have you heard of it, guys?
- [23:43]
C
Yes.
- [23:44]
B
They primarily handle childcare for companies. Like, I work for Verizon, and Verizon uses Bright Horizons, and if you have, like, an emergency, you can take your kid to a Bright Horizon center. I spoke to their CEO. They're doing okay. Like, he took a pay cut because people made a fuss. But they'll probably be okay because they make their money from the companies that hire them, but they're they're not the norm. I also spoke to the why they're a nonprofit that's very large and they're really struggling now also because they're mostly closed down. They're just, you know, they just have a few essential, like half their centers have services open for like essential workers. But they're losing billions.
- [24:23]
A
Also right now, let's get to some of the questions that we weren't able to answer on our Facebook Live chat because that was fun and we should do it more often. But we definitely had questions on Twitter and I feel like if you put up, if you put a question on Twitter, you're more likely to be a listener to the podcast rather than a simultaneous listener to the chat. So maybe we should answer one of the Twitter questions that came in. So here we go. Cody Houseman wants to know what Anna Shymansky thinks about ETF investing through platforms like Robinhood, which is famously the millennial friendly, zero cost place to buy stocks and ETFs.
- [25:12]
C
Well, I mean, I guess there are many ways to go with that question. In general, I am a fan of ETFs, products that have also actually held up particularly well during this crisis, more than some people thought they would. Which platform you buy them on? That depends on a number of things. I mean, the thing I would say though is that a lot of these kind of challenger platforms like Robinhood have also made a lot of the more kind of traditional platforms just cut their fees to zero as well. So if you were looking at the place that, you know, you wanted to put your money, I would probably say, you know, look where you are getting the lowest fees, you know, but also make sure that it's a, you know, a platform that you can use. Make sure that you trust the platform. I mean, I know Robinhood itself got into some trouble, not just because they had the outages, but I think they also, you know, they had some issues where they were potentially moving trades where they weren't actually getting the best price execution. They got fined for that. So, like, look at that kind of thing. Like, you know, when you're Robin, Robin.
- [26:13]
A
Had just had a series of scandals. Do we all remember when they announced that they were going to open up a checking account and then they had to change their mind, like, wait wildly because no, you can't do that. You're not a bank. Don't pretend to be a bank when you're not a bank. Yeah, I think Anna's absolutely right. If you're looking at ETFs, conceptually there are two layers of fees that you pay. One is the management fee in the etf. And it's always a good idea, especially if you're buying an index fund, to just pick the index fund with the lowest fee pretty much because A, that's likely to be the biggest fund. So you get a bunch of like extra liquidity and tighter bid office spreads just because of that and B, because obviously lower fees turn into more money for you, less money for the manager. And so it's a win win for you to pick the lower fee fund. And then the other layer of fees is as Anna says, like which shop are you going to go to to buy that fund? Are you going to go to Robinhood, you're going to go to Schwab, you're going to go to Vanguard, you're going to go to Fidelity. And again like just pick the one which is cheapest. Like this is a commodity product. It's not like if you buy an S&P 500 index fund through Fidelity, it will give you any different return from the same ETF if you buy it through Robinhood. So while there are advantages to being able to do things easily through a pretty app on your phone, the main thing is fees. And honestly, there's a part of me that wants to say being able to trade easily through a pretty app on your phone is a bug and not a feature you actually don't want to be able to trade easily. Stock trading is not something which you should be doing or thinking about or actively caring about ETFs when they're done. Well, when they're done right as something which you buy once and then forget about for the next 35 years and then they are worth more money in 35 years time. So having the ability to check on the value of your portfolio eight times a day by opening an app on your phone is actually something you kind of don't want.
- [28:24]
C
Yeah, the one, one last thing I will say also, just like if you're looking products that you're buying, understand what you are buying and you know, if you're, if you're buying, you know, a simple, you know, index fund of the S and P or one of the, you know, very broad bond funds, but you know, we talked about a little bit, you know, a number of weeks ago, some of these like commodity based ETPs or they have ETNs and all these things, they call them all ETFs but if you actually look at what they are, they're not good.
- [28:50]
A
So just, yeah, USO don't Buy, don't buy. Whatever you do, don't buy us. So that's the, that's the oil thing, which, it's very popular on Reddit. Just stay away from that.
- [29:03]
B
Didn't Robinhood also crash a little bit?
- [29:05]
C
Yeah, they did have a few outages.
- [29:08]
B
Yeah, I feel like I wouldn't.
- [29:09]
A
Major, major outages, like all day outages on major days of the stock market.
- [29:14]
B
That's not a good look. Not a good look.
- [29:16]
C
And again, I, that's why I say you do want to make sure it's also an organization you trust. You know, like that's one other thing.
- [29:24]
A
Yeah, like why would you buy, why would you trade with an organization which is run by a couple of tech bros when you could, you know, maybe find something a little bit more boring? Boring is good.
- [29:33]
C
Yeah, really is. Really is.
- [29:37]
A
Anna, your dad has a question.
- [29:40]
C
My dad does have a question.
- [29:42]
A
Can we answer your dad's question?
- [29:44]
C
Yes.
- [29:45]
A
Your dad, like, was very good and he logged into Facebook and he dropped in the question. I didn't notice it was your dad, but like, yeah, it's your dad. We should answer your dad's question.
- [29:53]
C
Yes. So, yeah, my dad, who, as I'm looking at these questions, I'm like Michael Shymansky, Like, I'm pretty sure that's my dad. I know there are other Michael Szymanskis, but. So my dad asked about high rise parking structures in New York City, which is also particularly my dad question, considering how much time he spends whenever he comes to visit me trying to find parking because my parents will not fly. They always just drive from Michigan. Don't ask me. That's another question.
- [30:23]
B
How long is that drive?
- [30:24]
C
It's like 12 hours. I've definitely done it multiple times. It's a really long drive.
- [30:28]
A
And just to be clear on our definitions here, high rise here means like five stories, right? It doesn't mean sort of like 15 stories.
- [30:37]
C
Yeah, well, the point he was making, because I did in fact talk to him afterward, to be like, was that you. Was this idea that, okay, if all of a sudden you have a lot of New Yorkers who are buying more cars and if they're not the New Yorkers who are leaving, but the New Yorkers who are actually staying here, I mean, everyone who lives in New York knows it is very expensive to have a car. It is very hard to find a place to, to have a car. So then does that raise the question that if all of a sudden people are scared to use public transport or they want an ability to be able to leave the city and they do buy, are more apt to buy cars. There needs to be a place to put them. And, you know, I do think that's. It's interesting because, you know, one of the things we had seen in the last, you know, 10, 15 years was kind of the opposite. When I think of like, gas stations, like it used to be back in the day in New York, on these corners, you'd have gas stations, and then so many of them went away and then all become. Became all these other buildings. As, you know, people had fewer cars. So it is interesting.
- [31:26]
A
I don't think that was a fewer cars thing. I think the gas station thing was just like, what is the highest value use of that land thing? That when, you know, when rents were low, you could make a lot of money with a gas station, but when rents are high, you could make even more money by putting a condo there. So people put a condo there.
- [31:44]
C
No, that's true. And especially because a lot of these tended to be corners. So. Yeah, no, I think you're right about that. But it is interesting to think one of, you know, one more step like, you know, if all of a sudden we have everybody working from home, you know, you don't have as many people using commercial real estate. You know, if people are buying more cars, would then potentially you see certain buildings, you know, be destroyed and become parking lots? I don't know. I think that's probably unlikely.
- [32:08]
B
But if more people are working from home, then overall you'll have fewer people driving into the city because there's. In New York there are like a big contingent of people that do drive in for work. So probably like balance each other out.
- [32:21]
C
No, it's probably true. I mean, I.
- [32:23]
A
But the mathematics is interesting because I think Anna's right that there's not a lot of economics in. In fact, there's zero economics and spending a bunch of money to sort of tear down a building and build a car park in its place. Meanwhile, if you. Certainly in cities like London and Milan, but even to some extent in New York, you're going to have to see a significant reduction in. On street parking, just because the demand for bike lanes and space on sidewalks is going to be much greater. A bunch of that space for bikes and for pedestrians is going to have to come from the space which is currently given to. On street parking. So all of that car storage, which was on the street is now going to have to move off the street into car parks. And the supply and demand dynamics are pretty simple there, that the supply is not changing and the demand is probably going up. At the margin, there is going to be a bunch of people who. The number of people who drove into Manhattan in the past was always relatively low, and that number is going to go up. I don't know. I mean, Emily is looking at me in a very sort of befuddled way and saying, what are you talking about? Loads of people drove into Manhattan. It's actually not true. The overwhelming, overwhelming majority of people who came into Manhattan would do so on some kind of public transit. And people outside Manhattan had cars, but they overwhelmingly used those cars to drive around outside Manhattan rather than to.
- [33:55]
B
Why was there so much traffic, Felix?
- [33:56]
C
There's so much commercial traffic coming in.
- [33:58]
A
Yeah, a lot of it wasn't. It wasn't mostly private cars. It's a lot of Ubers, It's a lot of taxis. It's a lot of trucks. It's a lot of deliveries. Yeah, there's a lot of people, like, ordering things online because they think that that's. It will just automatically appear at your door. But it doesn't automatically appear at your door. It comes on some kind of motorized vehicle.
- [34:17]
B
Look, I'm not saying you're wrong because I don't have the statistics, so probably you're right. But just as someone who sat in rush hour traffic coming into the city approximately 1 million times over her life, I cannot believe that a lot of people drive into the city. Regular people, not just commercial.
- [34:35]
A
I'm sorry, it may or may not go up, but I do think that demand for parking is going to be around for a while. I don't know whether that makes car parks a good investment, though.
- [34:47]
B
Is your dad going to invest in car parks?
- [34:49]
C
No. Let's hope. In Iowa.
- [34:53]
A
Is there an etf?
- [34:55]
C
Exactly, the Car park etf.
- [34:58]
A
Okay, let's have a numbers round. I'm going to start with one from yesterday morning, which is 16 point. That's the decline in retail sales in April. Apparently the market was expecting a decline of about half that, but in fact, the amount we spent went down 16.4% in April. And can I just come out and say that it doesn't seem that much to me for, like, given how, like, the entire country was locked down for the entire month, that we wound up spending 85% of what we did in March and probably 80% of what we normally would. That's almost an optimistic sign for the economy. Maybe.
- [35:44]
B
You can't keep Americans from shopping. We love it.
- [35:47]
C
It's true. It's true.
- [35:50]
B
Everyone I know, they bought New stuff like it has not stopped.
- [35:54]
A
It's amazing how much you can buy these days without leaving your house.
- [35:57]
B
Don't have to leave.
- [35:59]
A
Emily, what's your number?
- [36:01]
B
So that was my number, the retailer.
- [36:04]
A
Oh, really? That's my first. I went first because I decided I was gonna get in there first.
- [36:08]
B
Here's my number. Here it is. My number is 10. That is the number of episodes in ESPN's the Last Dance.
- [36:16]
C
So good.
- [36:17]
B
So good.
- [36:18]
C
Oh, my God.
- [36:19]
B
Episodes are coming out Sunday night and if you aren't watching it, you have to watch it. It is like the most delightful content of the lockdown. Right, Anna?
- [36:29]
C
It is absolutely wonderful. So ESPN, ESPN's documentaries are just absolutely amazing. Like their OJ Simpson documentary is just like full on. One of the better documentaries I've seen.
- [36:38]
A
It was so well done. If I know nothing about sportsball, is this something I'll enjoy?
- [36:42]
C
Watch it.
- [36:42]
B
Yes, it is really enjoyable.
- [36:44]
C
So fascinating. I mean, the personalities are fascinating. And one of the things ESPN does is that they really are good about putting things in like the cultural context. And this one in particular, it's so interesting because it's like also like the kind of the financial dynamics of basketball as it was developed and especially as like the kind of sports merchandise industry which Michael Jordan kind of, you know, revolutionized. Right? Really did. I mean, it's so fascinating and yeah, it's so good.
- [37:12]
B
We had this quote when we talked about, as Felix calls it, sports ball a while back and there was that quote from Michael Jordan we used that was like republicans buy shoes too or something. And they kind of like explain the whole story behind that quote and is so interesting and there's no way he would have said that now in this era. It's just, it's so interesting to think about now versus then and like how sports figures were viewed and like Michael Jordan wouldn't have been Michael Jordan if he, if he had played in these times.
- [37:44]
C
It's just.
- [37:45]
B
It's so good, Felix. You should watch it. Plus, the 90s music is really, really good.
- [37:49]
C
It really is.
- [37:52]
A
All right, Anna, what's your number?
- [37:53]
C
So my number is 70. So that is how old my dad is today.
- [37:59]
A
Happy birthday, Michael Chmansky.
- [38:01]
C
My father's birthday. So wishing my dad a very happy birthday. We are having a little Zoom party.
- [38:06]
A
This evening and here's wishing you lots of multi story car parks.
- [38:11]
C
Yes. In your future, better access to parking when it comes to business. I bought him, I actually bought him bread. My dad loves bread. And there's this wonderful place in Ann arbor called Zingerman's that has like some.
- [38:23]
A
Of the best Zingermann's I know.
- [38:24]
C
Yes, it's wonderful. And they have the greatest bread gifts. So that's what I got my dad gifts.
- [38:29]
B
I'm writing that down.
- [38:31]
A
One day, Michael Shymansky, you'll be able to go to Miami where my favorite multi story car park lives. It's designed by Herzogen de Meuron. Did you know that Herzogen Demuron made a Miami park?
- [38:42]
C
I did not know that.
- [38:43]
A
Check it out on the Internet.
- [38:45]
B
You should put it in your newsletter.
- [38:47]
A
I think I probably will. Yes. I have a building of the week in my newsletter. So maybe this week I'll put the Herzogunda Mehran parking lot just for Michael Chimersky. So I think that's it for us this week. Thank you so much for listening to Slate. Nonnie, thanks for keeping the emails coming in. We do answer questions even when they're not part of Facebook Live, so keep the question gyms coming in. Slatemoney@slate.com. many thanks to Jessamine Molly for producing this show and we will talk to you next week on Slate Money.