Trump's Tariff Confusion, Meta's Antitrust Trial | Bloomberg Technology
ABOUT WHAT WE CAN EXPECT THAT PUTS THE IDEA OF WHAT FAIR VALUE IS INTO QUESTION AND PEOPLE WAITING TO SEE WHAT ANIMISTS LOOK LIKE AFTER A MONTH OR SO. THERE A LOT OF PEOPLE WHO WANT TECHNOLOGY COMPANIES TO SEE STEEP REVISIONS. THERE ARE LOTS OF PEOPLE WHO SAY THEY DO NOT CARE. HERE IS WHAT PRESIDENT TRUMP HAD TO SAY ABOUT TARIFFS YESTERDAY SPEAKING ON AIR FORCE ONE. WE WILL BE DISCUSSING IT. BUT WE ARE ALSO TALKING TO COMPANIES. YOU HAVE TO SHOW A CERTAIN FLEXIBILITY.
>> FLEXIBILITY FOR SOME PRODUCTS? >> FOR SOME PRODUCTS, MAYBE. >> WE ARE JOINED BY THE VICE PRESIDENT FOR THE SUITE THAT INCLUDES TABLETS AND WEARABLES AND SO MUCH MORE. FRIDAY NIGHT, WE BELIEVED IT WAS A REPRIEVE OF CONSUMER ELECTRONICS IN PARTICULAR NOT BEING SUBJECT TO THE HUNDRED 20 5% LEVEL TARIFF. BY SUNDAY, YOU HAVE THE ADMINISTRATION SAYING WE WILL HAVE ELECTRONIC SPECIFIC TARIFFS TO COME. WHEN YOU GOT YOUR DESK THIS MORNING, WHICH DO YOU THINK WE STOOD? >> MY OPINION IS THIS WAS PART OF THE MASTER PLAN.
IT IS HARD TO KNOW IF THAT WAS THE CASE, BUT I THINK GENERALLY ON THE TECH ASPECT OF THESE TARIFFS THAT WE HAVE SEEN, THERE WAS NO WAY THE ECONOMY WAS GOING TO SUSTAIN AROUND THESE FROM THE U.S. SIDE BUT REALLY BOTH SIDES. SO MANY WERE EXPECTING THIS. THAT WAS DISCUSSED ON PREVIOUS INTERVIEWS YOU HAVE HAD TODAY, BUT IT COMES BACK TO THE PREVIOUS FROM YOUR TEAM YOU JUST HAD ON. WE ARE NOT SEEING SUPPLY'S MOVE MUCH. WE EXPECT THERE TO BE MORE TO
GET DONE WHAT YOU CAN, BUT EVEN FROM THE ANALYST SIDE ON THE STREET, IT SEEMS EVERYONE IS HOLDING GROUND BECAUSE OF THE UNCERTAINTY ACROSS THE BOARD. ED: YOU PUBLISH INTERESTING DATA ON THE SMARTPHONE MARKET IN THE FIRST QUARTER. THIS IS THE MARKET SHARE THING AND WHY WE KEEP FOCUSING ON APPLE IN PARTICULAR. YOU SEE AFTER SAMSUNG, BUT GENERALLY THE MARKET GREW 1.5% IN THE FIRST THREE MONTHS OF THE YEAR.
I'M SEEING A LOT OF EVIDENCE THAT THERE WAS SOME FRONT RUNNING BECAUSE PEOPLE KNEW TARIFFS WERE COMING. HOW MUCH OF THAT FACTOR INTO YOUR RESEARCH? >> THERE WAS A PLAY OF GROWTH IN THE FIRST QUARTER AND SO FORTH BUT I DO NOT KNOW IT WAS AS DRASTIC AS WHAT WE SAW FROM MEDIA HEADLINES TOWARD THE END OF MARCH. WE ARE SEEING ACTIVITY WHERE NOW IT IS COMING TO FRUITION ESPECIALLY WITH THE PAUSE ON TECH, SO THERE ARE TWO WAYS TO THINK OF IT. THE SUPPLY SIDE UNDERSTANDS WHAT THEY ARE UP AGAINST DAY-TO-DAY.
EITHER A TARIFF ON OR OFF. IF IT IS OFF, WE MAKE A DECISION TO SPEED UP THINGS. THE CONSUMER SIDE IS NOT THAT STRAIGHTFORWARD BECAUSE GENERALLY WHAT THE INDUSTRY IS LOOKING AT IS DOES ALL THIS UNCERTAINTY THAT IS CONSISTENT JUST SLOW DOWN ECONOMIC DEMAND? NOT TECH RELATED, BUT JUST IN GENERAL? WE BELIEVE IT DOES. THAT IS A FACTOR WE HAVE TO
BUILD IN. YOU DO NOT WANT TO SHIP MUCH IN OF PEOPLE ARE NOT WILLING TO BUY. CAROLINE: -- ED: YOU SAID THE SUPPLY SIDE DOES KNOW WHAT IS GOING ON. LET'S TAKE APPLE AS A CASE STUDY. THE REPORTING IS THE STRATEGY NOW IN THE CASE OF THE IPHONE IS PRIORITIZE IPHONES BUILT IN INDIA AND MOVE THEM TO THE UNITED STATES. IN INDIA, THEY DO ABOUT 30
MILLION HANDSETS A YEAR. THAT IS NOTHING IN OVERALL PRODUCTION GIVEN MOST OF THOSE GO TO A BIG MARKET IN AMERICA. YOU THINK THEY HAVE A PLAN TO ADJUST AND THAT THEY UNDERSTAND WHAT THE ADMINISTRATION IS DOING WITH ELECTRONIC TARIFFS? >> I DO NOT THINK THEY ARE GUESSING THE PLAN. THIS IS SPECULATION. SOME COMPANIES WOULD EITHER HAVE DISCUSSIONS THAT HAVE BEEN ONGOING SINCE THE ELECTION. THAT IS JUST WHAT BIG COMPANIES DO EVERY ELECTION YEAR, BUT I WOULD THINK THERE ARE FEW ON TARIFFS BECAUSE THAT IS WHAT THIS ADMINISTRATION PLANNED ON. I DO NOT THINK THEY KNEW EVERY
DETAIL BUT I WOULD ASSUME SOME OF THESE BIG COMPANIES WERE FOREWARNED OR HAD SOME HEADS UP, BUT MAYBE NOT. THE INDIA PIECE KEEPS COMING UP WITH IPHONE AND I THINK IS INTERESTING. PRIOR TO APRIL 2, THE PLAN WAS TO RAMP UP MORE ASSEMBLY AND MANUFACTURING IN INDIA.
THAT HAS BEEN WELL DISCLOSED, BUT WHETHER THIS SHIFTS THINGS THAT QUICKLY TO FEED THE U.S. MARKET I AM MORE SKEPTICAL OF, BUT I THINK THESE PAUSES OR EXEMPTIONS ON CHINA ARE GOING TO BE THE FOCUS. ED: APPRECIATE IT. COMING UP IN THE SHOW, META HAS
TO TRIAL FACING A LANDMARK ANTITRUST CASE THAT COULD RESHAPE BIG TECH. AND TAKING A LOOK AT SHARES OF PALANTIR, UP 6.5%, ANNOUNCING A DEAL WITH NEW TO COMMUNICATIONS AND NATO -- NATO COMMUNICATIONS AND NATO'S AGENCY. THAT IS CLEARLY MOVING SHARES OF THAT DEFENSE TECHNOLOGY NAME IN THIS MARKET. THIS IS BLOOMBERG TECHNOLOGY.
ED: AFTER MORE THAN A DECADE SINCE PURCHASING INSTAGRAM AND WHATSAPP, META IS FACING A LANDMARK TRIAL ALLEGING INMATE KILLER ACQUISITIONS TO STIFLE COMPETITION. WE ARE UNDERWAY. WHAT IS THE LATEST HEADLINES OUT OF D.C.? >> WE HAVE HEARD INTRODUCTORY REMARKS HAVE BEGUN AND THE FTC IS LANG AT A CASE IN WHICH IT IS ALLEGING META ENGAGED IN A BUY OR BURY STRATEGY, SQUASH COMPETITION AND DEGRADING THE QUALITY OF THE APPS THAT META NOW OWNS. ED: THIS IS A BEHIND CLOSED DOORS PROCEEDING, SO THE COUNTERARGUMENT IS STRAIGHTFORWARD.
LET'S BRING A QUOTE FROM THE CHIEF LEGAL COUNSEL. THEY ARE POINTING OUT HOW CAN YOU HAVE A MONOPOLY IN A MARKET WHERE OTHER PLAYERS HAVE SIMILAR NUMBERS? SO TIKTOK AND YOUTUBE IN PARTICULAR AND ARGUING META HAS A LESS THAN 30% MARKET SHARE IN THOSE MARKETS. >> IT IS AN AMAZING ARGUMENT BECAUSE THE FTC HAS CENTERED THIS AROUND SNAP AND META SAYING ANYONE WITH A KID AT HOME NEWS TIKTOK IS A GREAT COMPETITOR TO INSTAGRAM. I FIND INTERESTING ABOUT THIS IS ONE OF META'S REPUTATIONAL WEAKNESSES HAS BEEN THAT IT COPIES ITS COMPETITORS AND HERE IN THIS CASE THE LEGAL TEAM IS ACTUALLY USING THAT TO ITS ADVANTAGE. ED: WE WILL COVER IT THROUGH THE WEEK. LET'S GET MORE ON META'S
HISTORIC TRIAL. A GLOBAL COMPETITION PROFESSOR JOINS US NOW. EVEN BEFORE THE PROCEEDINGS GOT UNDERWAY THIS MORNING, THE CHAIR OF THE FTC GAVE AN INTERVIEW TO FOXBUSINESS AND BASICALLY CAME OUT STRONGLY. WE SEE META AS A MONOPOLY. WHAT DO YOU MAKE OF THE TIMING OF THE COMMENT AND THE INTERVIEW? >> I THINK HE IS TRYING TO UNDERSCORE THE COMMITMENT OF THE COMMISSION TO CARRY THE CASE FORWARD.
THERE HAVE BEEN QUESTIONS RAISED ABOUT WHETHER THE INTERESTS OF THE WHITE HOUSE IN THE CASE, LOBBYING BY THE WHITE HOUSE MIGHT LEAD TO A SETTLEMENT, SOME ACTION THAT WOULD SELL THE CASE OUT AND I THINK WITH THE CHAIRS TRYING TO DO IN INTERVIEWS INCLUDING THIS MORNING IS TO SAY IN HIS WORDS WE ARE KEEPING OUR FOOT TO THE GAS AND WE ARE NOT GOING TO BACK DOWN. ED: YOU ARE A FORMER MEMBER OF THE FTC AND CHAIR TO THE AGENCY BETWEEN MARCH 2008 AND MARCH 2009. UNI AND I OVER THE YEARS HAVE DISCUSSED THE THREAT OF ANTITRUST ACTION AGAINST META AND OTHERS MANY TIMES, SO I ASK HOW DOES THIS TRIAL COMPARE AND DOES IT HAVE TEETH? >> THIS DOES HAVE TEETH. THERE ARE FORMIDABLE OBSTACLES IN THE PATH OF THE FTC, OBSTACLES THE JUDGE WHO IS TRYING THE CASE HAS MENTIONED BEFORE, BUT THE REQUESTED RELIEF IS SERIOUS. THE DIVESTITURE. THE FTC HAS MARSHALED EVIDENCE
THAT COMES IN MANY WAYS OUT OF THE FILES OF META ITSELF. THE WORDS OF HIS SENIOR LEADERSHIP. IT IS GOING TO TRY THE CASE IN MANY WAYS BY SHOWING THAT META ITSELF BELIEVED IT HAD MARKET POWER AND THAT THE ACQUISITIONS WOULD SUPPRESS COMPETITION. META HAS GOOD RESPONSES TO THIS. BUT THIS IS A DEADLY SERIOUS EXERCISE FOR THE COMPANY AND IF THE JUDGE FINDS LIABILITY AND TAKES THE REMEDIAL PATH AVAILABLE TO THE FTC AND THE JUDGE, WE COULD SEE A MAJOR DIVESTITURE THAT WOULD AFFECT THE COMPANY DRAMATICALLY. ED:
WHAT ARE THE CHANCES OF THAT? HOW DO YOU MODEL FOR THAT IN A TRIAL SCENARIO? >> IF WE WERE LOOKING AT A BETTING SHOP AND TRYING TO PLACE ODDS, META WOULD HAVE AN ADVANTAGE BECAUSE IT IS GOING TO BE ABLE TO MARSHAL ARGUMENTS THAT WE DO NOT HAVE MARKET POWER IN THIS MARKET AND THE FTC CANNOT TOSS ASIDE TIKTOK AND YOUTUBE AND OTHER SOCIAL NETWORK PROVIDERS. THAT IS GOING TO BE A HARD HURDLE TO GET OVER, SO I GIVE A MODEST ADVANTAGE TO META IN HANDLING THE CASE, BUT A LOT OF THE FTC'S EVIDENCE IS GOING TO COME RIGHT OF ITS FILES -- RIGHT OUT OF ITS FILES. WE WILL HAVE AN UNPRECEDENTED LOOK AT HOW THE COMPANY OPERATES AND THAT IS WHAT MAKES TRIALS RISKY AND DANGEROUS FOR DEFENDANTS. ED: WE ARE SHOWING THE ARGUMENT OVER THE WEEKEND, WHICH IS AS YOU EXPLAINED HERE LOOK AT THE TRAFFIC AND AUDIENCE SIZE OF TIKTOK AND YOUTUBE AND THEIR ARGUMENT THAT THEY HAVE A LESS THAN 30% MARKET SHARE. COULD WE GO BACK TO WHERE WE STARTED? WHICH WAS THE FTC SHARE ON FOXBUSINESS THIS MORNING. A LOT OF PEOPLE LOOKED AT JD
VANCE AND HIS ATTITUDE TOWARD BIG TECH. IT DOES SEEM IN THE EARLY STAGES THAT PRESIDENT TRUMP LISTENS TO JD VANCE ABOUT OVERSIGHT OF BIG TECH. WHAT DO YOU MAKE OF THAT? >> PERHAPS THERE IS A PRE- DISPOSITION TO LISTEN FAVORABLY BECAUSE NOTICE THE NUMBER OF OCCASIONS IN WHICH THE PRESIDENT HAS SUGGESTED WERE NOT FOR DECISIONS MADE BY META AND GOOGLE IN 2020 THAT HE WOULD HAVE GAINED REELECTION, SO I DO NOT THINK HE IS DISPOSED IN A GENERAL WAY TO BE FOND OF THESE COMPANIES AND I THINK HE HAS ACCEPTED MANY OF THE ARGUMENTS THE VICE PRESIDENT HAS OFFERED TO HIM, SO HE HAS -- THERE ARE REASONS FOR WHICH HE MIGHT BE WEARING ABOUT TAKING A SETTLEMENT THAT WOULD BE GOOD FOR META HERE.
I SUSPECT HE WILL LISTEN, BUT HE IS NOT DISPOSED TO THINK THAT THEY ARE A PARTICULARLY GOOD ACTOR. ED: A FORMER FTC CHAIR. THANK YOU FOR YOUR ANALYSIS. COMING UP, A CONVERSATION WITH THE CRACK IN CO-CEO. INTERESTING MOVE WHEN IT COMES TO EXCHANGES IN THE DIGITAL WORLD. THIS IS BLOOMBERG TECHNOLOGY.
♪ ED: CRYPTOCURRENCY PLATFORM KRAKEN IS NOW OFFERING EQUITY TRADING. >> THIS IS A BIG MOVE TO GET IN TRADITIONAL STOCKS AND HOW MUCH IS THIS A MOVE TO TAKE ON ROBINHOOD, COINBASE IN A LARGER WAY IN TERMS OF PROVIDING A ONE-STOP SHOP FOR CLIENTS? ARJUN: IF YOU TAKE A STEP BACK ON THE MARKET, A LOT OF PEOPLE THINK OF CRYPTO AND TRADITIONAL EQUITIES AND TRADITIONAL FINANCE DIFFERENTLY AND WE DO NOT, WHICH IS OUR CORE CUSTOMER BASE AS PROFESSIONAL TRADERS AND THEY EXIST ALL OVER THE WORLD VERY SIMILARLY IN THE WAY THEY THINK, EAT, AND TRADE, SO COINBASE AND ROBINHOOD IN TERMS OF PEOPLE GETTING ON BOARDED INTO CRYPTO, THEN YOU HAVE OTHER COMPANIES. INTERACTIVE BROKERS IS FOCUSED ON PROFESSIONAL TRADING AND DAYTRADING. OUR GOAL HAS BEEN TO BE A LEADER IN CRYPTO ASSETS BUT ALSO A LEADER IN THE WAY IN WHICH OUR PROFESSIONAL TRADING AND CUSTOMERS AND CLIENTS WANT TO TRADE, LONG-TERM OR SHORT-TERM. THIS IS PART OF THE PATH FOR US TO CONTINUE TO DO THAT. IN ADDITION, WE WENT INTO AN
AGREEMENT TO ACQUIRE A COMPANY THAT FOCUSES ON PROFESSIONAL TRADING FOR RETAIL DERIVATIVES, SO WHAT YOU SEE US DOING HIS GO ACROSS A WIDER RANGE OF ASSET CLASSES. SONALI: WHAT DOES IT MEAN FOR YOU FINANCIALLY? A LOT OF INVESTORS ARE AWAITING A HIGHLY ANTICIPATED ONE-DAY IPO. WHAT CAN YOU TELL US ABOUT THE PATH AND HOW THIS HELPS YOU GET THERE? >> MOST IMPORTANT IS CLIENTS AND WHAT ARE CLIENTS CARE ABOUT IS TRANSPARENCY AND SECURITY. AS WE CONTINUE TO EXPAND GLOBALLY NOT JUST IN THE UNITED STATES BUT IN EUROPE AND THE U.K. AND CANADA AND INTO ASIA, THE THING THAT OUR CLIENTS CARE ABOUT MOST IS COUNTERPARTY RISK AND REGULATORY CLARITY, SO WE ARE SEEING MORE REGULATORY CLARITY AND EVENTUALLY MARKET STABILITY IN THE CRYPTO ECOSYSTEM SO ON BEHALF OF OUR CLIENTS WE WANT TO BE TRANSPARENT WITH OUR FINANCIALS AND WHAT WE ARE DOING AND IF WE DECIDE TO GO PUBLIC IT WILL BE A JOURNEY ALONG THE WAY. ED: TIMING IS EVERYTHING. IF YOU THINK ABOUT THE BUSINESS
MODEL OF ROBINHOOD OR COINBASE, THEY FOCUS ON VOLATILITY. VOLATILITY DRIVES VOLUME AND TRANSACTION. HOW MUCH IS THAT A FACTOR FOR YOU IN THIS INITIATIVE? ARJUN: IF YOU'RE THINKING ABOUT YOUR CLIENTS, THEN YOU ARE THINKING ABOUT MILESTONES ALONG THE WAY. THAT IS THE MOST IMPORTANT.
AS I MENTIONED BEFORE, BEING TRANSPARENT WITH OUR FINANCIALS AND RESERVES AND DEPOSITS, ABOUT WHAT PRODUCTS ARE, MAKING SURE THE EXCHANGE IS FAIR. THERE ARE NO REBALANCE -- REBATES OR DISCOUNTS TO THE WAY OUR CLIENTS INTERACT WITH THE EXCHANGE. VOLATILITY IN THE MARKET'S VOLATILITY IN THE MARKET. I CARE MORE ABOUT THE SLOPE AND LONG-TERM GROWTH. MORE THAN ANYTHING ELSE.
ED: ELSEWHERE, YOUR INVESTOR -- YOU ARE AN INVESTOR. THERE IS A LONG-TERM VIEW TO LOOK AT PAYMENTS AND OTHER FINANCIAL SERVICE OFFERINGS THERE. COULD YOU SEE WORKING WITH THE TEAM ON SOMETHING LIKE THAT? >> WHAT IS IMPORTANT IS WHERE OUR CLIENTS AND CUSTOMERS ARE SO YOU CAN THINK OF US AS TRADING -- THERE ARE ALSO PRODUCTS FOR SAVINGS AND YIELDS DEPENDING ON THE TYPE OF CUSTOMER AND EVENTUALLY YOU CAN THINK ABOUT PAYMENTS AND REMITTANCES TO FACILITATE PEER TO PEER COMMERCE. SO THOSE WILL BE JOURNEYS ALONG THE WAY. WE HAVE CREATED THE PLATFORM AND INFRASTRUCTURE TO PROVIDE THIS AND WE ARE ALREADY PARTNERING WITH FOLKS TO DO THAT TODAY SO ALMOST 10% OF OUR TRANSACTIONS ARE THROUGH PEOPLE CONNECTING THROUGH OUR APIS. SONALI: AS A FORMER PRIVATE INVESTOR IN SO MANY WAYS, YOU ARE FAMILIAR, BUT HOW QUICKLY CAN YOU GET THERE? ARJUN: TECHNOLOGICALLY, WE CAN GET THERE TOMORROW. IT IS ABOUT REGULATORY CLARITY
AND HOW YOU THINK ABOUT REAL-WORLD ASSETS THAT WE TALK ABOUT BRINGING INTO CRYPTO, SO WHAT I WOULD SAY IS THAT WHAT WE ARE DOING NOW, GIVEN THE FUTURE OF TRADING IS AROUND-THE-CLOCK AND 24/7, IS THAT LET'S LAY THE GROUNDWORK NOT JUST FOR MYSELF BUT OTHER EXCHANGES WORLDWIDE TO BE ABLE TO PROVIDE EQUITIES AND DIGITIZE THEM SO TOKENIZATION OF EQUITIES IS A TERM YOU HEAR A LOT ABOUT. WHEN YOU THINK ABOUT GLOBAL LIQUIDITY POOLS AND GLOBAL ACCESS TO CAPITAL AND DEMAND FOR THESE ASSETS, NO MATTER WHERE THEY MIGHT BE IN THE U.S. OR EUROPE, I THINK THIS LAYS A GREAT GROUNDWORK FOR COMPANIES TO START THINKING ABOUT HOW THEY SHOULD LIST, WHO THEY SHOULD WORK WITH, AND WHERE GLOBAL LIQUIDITY POOLS COME FROM. ED: GOOD TO HAVE YOU BACK ON THE PROGRAM.
COMING UP ON THE SHOW, ELECTRONICS EXPECTING A TEMPORARY REPRIEVE FROM TARIFFS. PRESIDENT TRUMP SAYS THERE ARE MORE TARIFFS ON THE WAY. LET'S TAKE A LOOK AT MARKETS AS WE GO NOW TO BREAK. NASDAQ 100, IT IS THE TECHNOLOGY SECTOR LEADING THIS CAUTIOUS COMEBACK IN FINANCIAL MARKETS BUT LOOK AT BITCOIN.
IT IS AN ASSET THAT TRADES 24/7 AND ALL THE HEADLINES OVER THE WEEKEND WE DID SEE SOME BUOYANCY AMID LIQUIDITY IN MARKETS LIKE ASIA. A LOT MORE TO COME ON THE PROGRAM. THIS IS BLOOMBERG TECHNOLOGY. ED: WELCOME BACK TO BLOOMBERG TECHNOLOGY. FINANCIAL MARKETS THE STORY IS TECHNOLOGY FOCUSED INDEXES REALLY HITTING SESSION LOWS. LOOK AT THE NASDAQ 100 OR THE PHILADELPHIA SEMICONDUCTOR INDEX. A TEMPORARY PAUSE AND REPRIEVE FOR HIGH-LEVEL TARIFFS ON CHINA MAKING PEOPLE THINK THINGS MAY NOT BE SO BAD FOR THE ELECTRONIC SECTORS.
THERE IS -- IS COMING. WE LOOK AT APPLE AS A CASE STUDY. APPLE HAS BEEN INTERESTING OVER THE LAST SIX DAYS. BASED ON HOW IT IS TRADING ON THESE HEADLINES. IT IS THE BIGGEST POINT DRIVER TO THE UPSIDE ON THE NASDAQ 100 NOW. THERE IS STILL QUESTIONS ABOUT WHAT IT WILL DO.
THE ADMINISTRATION WANTS ON SHORING OF MANUFACTURING. APPLE SEEMS FOCUSED ON SHIFTING MORE TO INDIA. LET'S GET BACK TO OUR TOP STORY. COMPANIES LIKE APPLE AND NVIDIA
APPEARING TO HAVE A MAJOR WIN. PRESIDENT TRUMP POSTING UNTRUTH SOCIAL THERE WAS NO TARIFF EXCEPTION, WHICH WAS ANNOUNCED FRIDAY. THESE PRODUCTS ARE SUBJECT TO THE EXISTING FENTANYL TARIFFS AND THEY ARE JUST MOVING TO A DIFFERENT TARIFF BUCKET. FOR ME, THE MAIN LEARNING OF ALL OF THE LAST FEW DAYS IS THAT THE WHITE HOUSE IS STARTING TO THINK ABOUT HOW IT DEFINED SEMI CONDUCTORS AND ELECTRONICS AS -- AND SOMETHING SPECIFIC IS COMING. >> THE PRESIDENT PUSHED BACK ON THE IDEA OF EXEMPTIONS AS FAKE NEWS BUT THE WHITE HOUSE STATEMENT LITERALLY SAID CLARIFICATION OF EXEMPTIONS. BUT WITH THE PRESIDENT AND OTHERS, INCLUDING THE COMMERCE SECRETARY, ARE ARGUING IS THIS DOES NOT MEAN THIS IS A FREE PASS FOREVER. THIS IS ABOUT PROCEDURE.
THESE GOODS FOR NOW WILL NOT BE SUBJECT TO THE 10% GLOBAL BASELINE TARIFF WHERE THEY WERE HUNDRED 25% RECIPROCAL TARIFF RATE ON CHINESE IMPORTS BUT THEY ARE SUBJECT TO THE 20% FENTANYL TARIFF RATE ON EVERYTHING THAT COMES OUT OF CHINA AND WILL BE SUBJECT TO SEMI CONDUCTOR TARIFFS THAT PRESIDENT TRUMP HAS BEEN PROMISING. HE REFERS TO IT AS UNDER A DIFFERENT BUCKET UNDER DIFFERENT AUTHORITY. IT WOULD FACTOR IN NATIONAL SECURITY PART OF THE EQUATION. THE PRESIDENT OVER THE WEEKEND SUGGESTED IT IS NOT JUST SEMI CONDUCTORS BUT THE WHOLE ELECTRONICS SUPPLY CHAIN THAT THEY ARE LOOKING AT THROUGH THE INVESTIGATION. HE DID INDICATE THIS IS COMING
SOONER RATHER THAN LATER, SUGGESTING TO REPORTERS THAT HE COULD HAVE A RATE OF THE SEMI CONDUCTOR TARIFF ANNOUNCED THAN A WEEK AND THE TARIFFS THEMSELVES WILL BE APPLIED IN THE NOT SO DISTANT FUTURE. ONE THING THAT DOES POTENTIALLY PROVIDE A WINDOW OF OPPORTUNITY OR ABILITY TO MANEUVER FOR COMPANIES LIKE APPLE IS WITH THE PRESIDENT WAS ASKED BY A REPORTER YESTERDAY AT WOULD BE EXEMPTIONS FOR IPHONES HE SUGGESTED HE CANNOT BE RIGID WITH THIS, THAT THERE HAS TO BE FLEXIBILITY. IT IS NOT CLEAR HOW HE IS DEFINING FLEXIBILITY OR WHERE THE SO-CALLED FLEXIBILITY I'D APPLY. -- MIGHT APPLY. ED: LET'S BROADEN THE CONVERSATION TO INCLUDE FINANCIAL MARKETS. OK. YOU GOT INTO HER OFFICE THIS MORNING. YOU LOOKED AT THE COMMENTARY FROM THE PRESIDENT AND DOCUMENTS FROM FRIDAY NIGHT FOR EXEMPTIONS.
WHERE DO YOU THINK TARIFF POLICY STANDS FOR TECHNOLOGY? >> ABOUT AS CLEAR AS MUD. THIS IS REALLY HIGHLIGHTING THAT THERE DOES NOT SEEM TO BE MUCH CLARITY AT ALL OVER WHAT THE TRUMP ADMINISTRATION IS DOING, WHERE WE ARE AT, WHAT MIGHT COME TOMORROW. THIS IS MAKING IT DIFFICULT FOR CLIENTS TO TRADE, FOR BUSINESSES TO HAVE ANY LEVEL OF PLANNING OVER WHERE THEY SHOULD BE MOVING MANUFACTURING TO, FROM, WHAT RATE AND WHAT SPEED. IT JUST FEELS LIKE THE FURTHER
WE MOVE THROUGH THESE TARIFF ANNOUNCEMENTS THE MORE UNCERTAINTY THERE IS ABOUT WHAT IS HAPPENING AND THAT IS BEING REFLECTED IN MARKETS QUITE DRAMATICALLY. WE SAW BIG SWINGS LAST WEEK. EVEN TODAY, WE STARTED WITH FUTURES HIGHER FOR U.S. TECH STOCKS AND -- THAN WITH A OPEN DATA. WE HAVE SEEN SOME REBOUND OR
STRONG REBOUND IN APPLE, BUT I THINK, GIVEN THE COMPANY HAS LOST VALUE OVER THE PAST TWO WEEKS AND THE REBOUND IS STILL RELATIVELY SMALL, THAT HIGHLIGHTS THAT UNCERTAINTY. ED: NVIDIA POSTED A BLOG EXPLAINING THEY ARE GOING TO, FOR THE FIRST TIME, BUILD AN AR SUPERCOMPUTER UNIT 100% IN AMERICA AND THAT IS A PLAN HAPPENING LARGELY IN TEXAS OVER THE NEXT FOUR YEARS. WHEN YOU SEE A HEADLINE LIKE THAT, HOW MUCH DO YOU THINK IT IS A DIRECT RESPONSE TO POLICY ACTIONS OF THE ADMINISTRATION SO FAR? FIONA: COMPLETELY. THIS IS ABSOLUTELY A DIRECT RESPONSE. THIS IS WHAT TRUMP IS AIMING FOR AND IT IS INTERESTING AS WELL BECAUSE IT IS MOVING THAT MANUFACTURING BACK TO THE U.S.,
WHICH IS WHAT TRUMP HAS PLEDGED ACROSS HIS CAMPAIGN AND SINCE TAKING -- MOVING INTO THE WHITE HOUSE. WHAT I THINK IS INTERESTING HERE IS WHAT THIS MEANS FOR COSTS. IT IS -- THERE ARE GREATER COSTS FOR MANUFACTURING IN THE U.S. THEN PERHAPS OTHER PARTS OF THE WORLD. SO THIS IS WHAT COMPANIES ARE
DOING IN ORDER TO BE ABLE TO KEEP THOSE COSTS DOWN AS MUCH AS POSSIBLE BUT IT WILL STILL RESULT IN AN INCREASE IN COST. WHEN IT STILL COMES TO CONSUMER ELECTRONICS, THAT IS WHEN WE ARE GOING TO SEE THAT HITTING. WE ARE GOING TO SEE CUTS GOING UP. EVEN WITH SUPERCOMPUTERS, IT IS GOING TO IMPACT THE COST INVOLVED. ED:
IF YOU ARE A TECHNOLOGY INVESTOR, HOW DO YOU PLAY IT? DO YOU STAY AWAY FROM APPLE OR OTHERS? FIONA: TECH HAD BEEN UNDER PRESSURE SINCE THE TRUMP ADMINISTRATION STARTED ANNOUNCING THESE TARIFFS AND THAT IS BECAUSE OF THE FACT THAT IT IS A GREAT STOCK. THERE IS MORE POTENTIAL LOOKING TOWARD VALUE RATHER THAN GROWTH RIGHT NOW, SO I THINK THE TECH SECTOR IS STILL A DIFFICULT SECTOR TO BE FOCUSING ON GIVEN THE LEVEL OF UNCERTAINTY THAT STILL EXISTS. THERE IS UNCERTAINTY ACROSS THE BOARD, BUT STILL MORE DEFENSIVE AREAS ARE GOING TO BE BENEFITING, SUCH AS HEALTH CARE AND INDUSTRIALS. THOSE ARE AREAS WE WOULD BE LOOKING AT RATHER THAN THE TECH SECTOR, WHICH I THINK STILL COULD POTENTIALLY COME UNDER FIRE FROM THE TRUMP ADMINISTRATION. ED:
THANK YOU VERY MUCH FOR YOUR TIME ON THE SHOW. COMING UP, THE FIRST ALL-FEMALE FLIGHT TO SPACE HAS TAKEN OFF ABOARD A BLUE ORIGIN ROCKET AND COME SAFELY BACK DOWN TO EARTH. WE WILL HAVE THE DETAILS OF THE LAUNCH COMING UP NEXT. ALSO, LOOK AT SOME MARKETS. WE KNOW WE ARE AT SESSION LOWS ON TECH SPECIFIC INDICES LIKE THE NASDAQ 100.
INTERESTING IS THE LIST OF CHINESE TECHNOLOGY COMPANIES AND THERE IS SOME RESPITE FOR THOSE NAMES WITH SIMILAR VOLATILITY TO THE REST OF THE SECTOR. STAY WITH US. WE WILL BE RIGHT BACK. THIS IS BLOOMBERG TECHNOLOGY. ♪ TODAY, AN EXCLUSIVE INTERVIEW WITH SCOTT BESSENT.
YOU WILL NOT WANT TO MISS IT. THIS IS BLOOMBERG. >> IGNITION. LIFT OFF. NEW SHEPARD HAS CLEARED THE TOWER. ED: THAT WAS BLUE ORIGIN'S NEW SHEPARD ROCKET TAKING OFF EARLIER TODAY WITH A STAR-STUDDED CREW OF SIX WOMEN, INCLUDING JEFF BEZOS'S FIANCE AND KATY PERRY. IT WAS A NOTABLE CELEBRITY THEMED FLIGHT.
WHAT HAPPENED AND WHAT IS THE BIG PICTURE WITH THIS ONE? >> IT WAS AN ALL-FEMALE CREW AND THAT WAS THE FIRST ONE SINCE 1963 WHEN A FEMALE SOVIET COSMONAUT WENT TO SPACE HERSELF. IT IS THE FIRST ALL-FEMALE CREW WITH MORE THAN ONE MEMBER. AND THEY WENT UP TO SPACE. I THINK THEY FELT A LOT OF CAMARADERIE, BEING ALL WOMEN AND BEING ALL -- BECOMING ASTRONAUTS FOR THE FIRST TIME. SO I THINK IT WAS A REALLY
SUCCESSFUL FLIGHT. EVERYTHING WENT AS PLANNED. EVERYTHING WENT SMOOTHLY AND MANY OF THEM MENTIONED IT HAD REALLY CHANGED THEM, COMING BACK. ED: GREAT TO HAVE YOU HERE ON BLOOMBERG TECHNOLOGY. LET'S GET MORE ON WHY THIS FLIGHT MATTERS FOR THE SPACE INDUSTRY. A SENIOR FELLOW AT THE HARVARD BELFORD CENTER AND FORMER ASSISTANT DIRECTOR FOR SPACE POLICY AT THE WHITE HOUSE BACK ON THE SHOW. THERE ARE A NUMBER OF WAYS WE CAN TAKE THIS CONVERSATION.
THE WAY I THINK ABOUT IT IS THE DATA. PRIOR TO TODAY'S MISSION, OF ALL THE PEOPLE WHO HAD GONE TO SPACE, ONLY 15% WERE FEMALE, SO WHAT IS THE SIGNIFICANCE FROM THAT STANDPOINT? >> MORE INNOVATION FROM THE SPACE SECTOR. WE ARE SEEING BLUE ORIGIN CEMENT ITSELF AS THE SAFE AND DEPENDABLE OPTION TO GO TO SPACE AS AN OPTION FOR SPACE TOURISM.
YOU CAN ZOOM PAST IN A FULLY REUSABLE . IT IS AN AMERICAN FEET. THE BIG QUESTION IS WHAT THIS MEANS FOR INVESTORS IN SPACE. DOES THIS MEAN INVESTORS WILL MOVE FURTHER INTO THE LAUNCH BUSINESS AND SUPPORT ADDITIONAL FLIGHTS? DOES IT MEAN WE WILL SEE ANOTHER ONE OF THESE IN ANOTHER DECADE? MAKING HISTORY AGAIN? OR WILL THIS CONTINUE TO BECOME COMMONPLACE? ED: WE GET ASKED ABOUT THE GAP BETWEEN BLUE ORIGIN AND SPACEX BUT THE OTHER PERSPECTIVE OF INVESTORS IS IT IS GOOD TO SEE PRIVATE SECTOR NAMES ABLE TO HAVE A LAUNCH SYSTEM THAT IS REUSABLE AND THAT ARE LAUNCHING WITH GREATER CADENCE. HOW IMPORTANT IS IT THAT BLUE ORIGIN STARTS TO MAKE PROGRESS IN ITS OTHER DOMAINS OUTSIDE OF NEW SHEPARD? I AM TALKING ABOUT ALSO IS ENGINE BUSINESS. I THINK IT IS IMPORTANT THAT THEY ARE ABLE TO SHOW SUCCESSES. SAFE SUCCESSES ARE ALL THAT MATTERS AND IT IS APPOINTED SHOW RESULTS IN ALL YOUR -- IT IS IMPORTANT TO SHOW RESULTS IN YOUR BUSINESSES.
IT IS IMPORTANT FOR THE INVESTMENT COMMUNITY. ED: THOSE WHO ARE SKEPTICAL SAY THIS IS A SHOP WINDOW FOR JEFF BEZOS, THAT IT IS ALL A FEMALE ALL CELEBRITY CREW. IT IS 150,000 DOLLARS FOR THE DEPOSIT. WE DO NOT KNOW HOW MUCH A TICKET COSTS BECAUSE IT DEPENDS ON YOUR RELATIONSHIP WITH BEZOS. WHAT IS THE COUNTERARGUMENT ON
HOW THIS PROGRESS IS AND ADVANCES EVERYDAY OPPORTUNITY TO GO TO SPACE? >> IT HELPS THE ENGINEERS WITH CONTINUOUS REPETITION, WHICH MEANS THEY ARE DOING IT SAFELY AND BECOME MORE USED TO DOING IT. SO THE ENGINES AND THE SYSTEMS PERFORM BETTER. IT BECOMES MORE COMMONPLACE. SECOND IS YOU THINK ABOUT THE ADVENT OF AIR TRAVEL.
IT WAS NOT AFFORDABLE TO EVERYONE, SO WITH THESE REPETITIONS WE HOPE THAT THE INTENTION IS THAT IT HELPS BRING DOWN COSTS SO YOU HAVE MORE PEOPLE ABLE TO GO TO SPACE. THIRDLY, I THINK WHAT THIS DOES IS IT INSPIRES OTHERS TO START A ROCKET COMPANY IN AMERICA. IN INSPIRES OTHERS TO SEE THIS AS SOMETHING THAT IS SOMETHING WE DO EVERY DAY AND NOT ONCE IN A DECADE. ED: LEAN ON YOUR EXPERIENCE IN OFFICE.
HOW DO YOU THINK THE WHITE HOUSE AND THE PENDING NASA ADMINISTRATOR WOULD VIEW THE MISSION THIS MORNING? >> I BELIEVE THE PENDING NASA ADMINISTRATOR WAS IN A SIMILAR FLIGHT, SO ONE CANNOT HELP BUT BE EXCITED THAT THIS IS CONTINUING, THAT THERE ARE MORE PEOPLE GIVEN ACCESS TO SPACE AND I THINK FROM THE WHITE HOUSE LENS WHEN YOU SEE AN AMERICAN COMPANY CONTINUE TO FOSTER INNOVATION THAT WE WANT TO SEE COMING FROM AMERICAN INGENUITY, THAT IS A PLUS. FROM THE LENS OF NASA AND THE WHITE HOUSE, WE WANT TO SEE AMERICAN PROMINENCE AND AMERICAN LEADERSHIP AND THAT IS WHAT YOU ARE SEEING HERE. ED: JEFF BEZOS A SIMILAR BIG PICTURE VIEW OF SPACE, LIKE ELON MUSK ONCE HUMANKIND TO BE MULTI-PLANETARY SPECIES.
JEFF BEZOS TALKS ABOUT LIVING AND WORKING IN SPACE. YOU REFERENCE THE FUTURE BUSINESS MODEL BLUE HAS OF THE FUTURE OF INTERNATIONAL SPACE STATIONS. DO YOU HAVE LINE OF SIGHT TO THAT FUTURE FROM A TEST LAUNCH LIKE WE HAD TODAY? >> ABSOLUTELY. THE INTERNATIONAL SPACE STATION IS SET TO RETIRE IN ABOUT SIX YEARS, SO BY 2030 WE EXPECT THAT TO START BEING RETIRED AND THERE ARE A NUMBER OF SPACE COMPANIES, INCLUDING BLUE ORIGIN, THAT ARE WORKING TO REPLACE THIS STATION. WE ARE NOT GOING TO SEE ONE STATION BECAUSE THE INTERNATIONAL SPACE STATION IS QUITE LARGE AND BUILT OVER A DECADE SO YOU WILL SEE MULTIPLE OPTIONS. YOU MIGHT HAVE A SPACE STATION FOR SCIENTIFIC RESEARCH AND ANOTHER FOR SPACE TOURISM SO WHAT YOU SEE IS THE -- THIS REPETITION OF FLYING GIVES A LOT OF -- ADDS A LOT OF EXPERIENCE AND EXPERTISE TO TEAMS BUILDING WHAT COULD BE A FUTURE SPACE STATION.
ED: IT IS GREAT TO HAVE YOU BACK ON THE PROGRAM. NVIDIA PLANS FOR MASS PRODUCTION OF AI SUPERCOMPUTERS BUILT ENTIRELY IN THE UNITED STATES. WE HAVE DETAILS COMING UP IN A LITTLE BIT. WE ARE BASICALLY FLAT ON THE NASDAQ 100 AND WE HAVE ERASED ALL OF OUR GAINS.
PRINCIPALLY, YOU SEE APPLE STILL HIGHER. IT IS NVIDIA AND AMAZON THAT ARE THE DRAG. NVIDIA IS INTERESTING. WE WILL GO OVER THE HEADLINES
IN A MOMENT, BUT SOME OF THE WIND TAKEN OUT OF THE SALES OF THIS TECHNOLOGY MARKET IN THE LAST 10 TO 15 MINUTES OR SO. THIS IS BLOOMBERG TECHNOLOGY. ED: INTEL WILL SELL A STAKE IN ITS PROGRAMMABLE CHIPS UNIT TO SILVERLAKE MANAGEMENT. IT SPINS OFF ITS NON-CENTRAL BUSINESSES. THE DEAL IS EXPECTED TO CLOSE IN THE SECOND HALF OF 2025. INTEL BOUGHT IT 10 YEARS AGO FOR $17 MILLION, PART OF THE STRATEGY TO DIVEST. ANOTHER CHIP NAME, NVIDIA IS WORKING TO
MASS-PRODUCE AI SUPERCOMPUTERS BUILT ENTIRELY IN THE U.S. I LATE 2026. IT IS RAMPING UP DEVELOPMENT OF TWO MANUFACTURING PLANTS IN TEXAS AND SAYS IT WILL PRODUCE HALF $1 TRILLION WORTH OF AI INFRASTRUCTURE IN UNITED STATES OVER THE NEXT FOUR YEARS. I THINK IT IS IMPORTANT TO BE
HONEST WITH THE AUDIENCE ABOUT THIS STORY BECAUSE IT HAS BEEN A MULTI WEEK THING WITH NVIDIA. WHAT DO THEY MEAN BY PRODUCE HALF A TRILLION DOLLARS OF AI INFRASTRUCTURE? WE ARE TALKING ABOUT IS ASSEMBLING THIS SYSTEM THAT THEY CALLED ACCELERATED COMPUTING, NOT JUST FABRICATION OF KEY CHIPS. >> THAT IS AN IMPORTANT POINT. ELECTRONICS MORE THAN ANY GOOD COME FROM EVERYWHERE YOU BUY A COMPONENT FROM VIETNAM, CHINA. IN NVIDIA'S CASE, I AM NOT CERTAIN BUT IT IS COMING FROM ALL OVER THE WORLD. WE ARE TALKING ABOUT LATER STAGE MANUFACTURE AND ASSEMBLY. WHAT WE KNOW IS THAT IN RECENT
WEEKS AND MONTHS THERE HAS BEEN PRESSURE FOR LARGE COMPANIES TO SPEAK ABOUT HOW WE ARE INVESTING IN THE U.S.. IF TARIFFS COME AND SUPPLY CHAIN DISRUPTIONS COME, WE ARE READY. SO THAT IS WHAT NVIDIA IS MESSAGING TODAY. THEY ARE RAMPING UP PRODUCTION IN THE U.S..
THEY WILL MAKE UP TO $500 BILLION OF GOODS IN THE U.S.. ED: IN TEXAS, WHO ARE THE MANUFACTURING PARTNERS? BRODY: THEY ARE PARTNERING UP IN TEXAS. IT IS THE WHO'S WHO OF COMPANIES DOING MANUFACTURING. FOR ARIZONA, IT WILL BE TSMC AND THE PHOENIX CAMPUS. ED: BRODY FORD IN NEW YORK CITY, REALLY APPRECIATE IT. THAT DOES IT FOR THIS EDITION OF BLOOMBERG TECHNOLOGY.
WHAT A START TO THE WEEK IT HAS BEEN, PARTICULARLY IN MARKET REACTION. A LOT OF YOU ARE LISTENING TO US AS A PODCAST. A LOT MORE TO COME THROUGH THE WEEK. PARTICULARLY WHEN IT COMES TO TECHNOLOGY STOCKS. FROM SAN FRANCISCO, THIS IS BLOOMBERG TECHNOLOGY. ♪
2025-04-20 09:06
