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tv   Bloomberg Markets Americas  Bloomberg  July 31, 2020 10:00am-11:00am EDT

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>> 3:00 p.m. in london. with 30 minutes into the u.s. trading day, i am guy johnson. my hosting new york "bloomberg markets alix steel. welcome to "bloomberg markets." -- my cohost in new york, alex deal. welcome to "bloomberg markets." upx: basically, we all ended buying iphones on apps advertised on instagram. let's see what is happening in the markets. index -- a reversal for their daughter. -- for the dollar. it was broadly weaker on the day. 1.25ing 1.18, i am hearing for the euro-dollar -- we will see. all of that equals buy more gold. guy?
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guy: the university of michigan giving indicators of consumer confidence, pretty much in line with that except for the current conditions number, which looks a little light. it is up in terms of where we would expected to be normally, but nevertheless, you have an 82 print there but and citation of 85. 84 last time. at headline number coming in 72.5, little lighter than the 72.9. to 10ion 2.6% five years years out. basically everything in linux of the current number. alix: we are a little worried about what is going on. underwaye call is right now, started at 10:00 a.m. they are reporting some good news in guyana. it has been a huge boon for hess is hard tobut it
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emphasize how bad this quarter was four at chevron and exxon, particularly with exxon not writing down any assets. joining us is mark stoeckle, adams funds ceo and senior portfolio manager. it is always good to see you. i want to start on tech. numbers were amazing. -- companies made made billions of dollars. on the flipside, people indios already making less, spending more, dipping into savings, and a lot have less money with the unemployment benefits wearing out of its extra boost. where do you reconcile that for yourself, as an investor? mark: good morning. it can be hard to do that, but i think the most important part is, often times -- and it has been noted on your show several times -- is there is a big difference between part of the economy and what these companies are able to do. as an investor, i think we need to continue to concentrate on what is driving revenue, what is driving margins.
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clearly, the message we got last night was that revenue and margins continue to be driven regardless of the fact that the individual,n to the my not be doing as well as we would all like it to be. guy: with these numbers have been so good if the u.s. government had not kicked in a load of stimulus into the u.s. economy? mark: that is a really good question. i think they would have been good. what they have been quite this good? not quite sure. before the most part, this was below anyway. i do not think these companies specifically rely on the part of the population that is getting the vast majority of the government stimulus. certainly some of it. you could argue some of the low havephones maybe would not
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done quite as well, the iphone se, but i do think there is a separation here, and it is something i think the market is having a hard time understanding. you look at what is going on with the economy, with unemployment, yet these companies continue to do what they are doing -- there is a decoupling there. but i think they all would have done well, even without the government stimulus. alix: so what do you do now? you have apple at a record high. how do you by the stocks? or do you not? how do you diversified your portfolio so you're not just stocks? mark: that is one of the messages that i think is overlooked too often. ondo we believe you should these four stocks -- and in varying degrees, we own all four of these stocks. but we also own 84 other stocks. ishink the diversification
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important, especially as these things drive up into a little bit of rare air. the valuations are not nearly as cheap. apple's valuation has effectively doubled in a year. i would argue that they are doing a lot of good things because of that, but i think that the idea that i am sitting at home, as an individual investor, and i will just own any of these four stocks is a mistake. important thats people diversified. i mean, let's look, just for a second, at the last month, say. that consumer discretionary, consumer staples, have both outperformed. haveials, utilities outperformed technology. if you're just sitting on these, you have missed a good opportunity. the only sectors in the past month i've done as badly as tech
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is energy and financials. so i think the diversification matters, especially over the long-term. short-term, you can beat yourself up because i should have owned a little more apple or a little more facebook. but i think, over a longer term, the diversification is really important. mark, one of the stocks you do own, family, is nvidia -- apparently, is nvidia. nvidia is looking to buy arms from softbank -- is that a good idea? mark: let me start rising i am not sure how it could be done. nvidia has plenty of cash on hand. they have that capacity as well be used,le stock to but let's not forget arm is an supplier of
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semiconductors. i have talked to our tech analysts. i am not sure why they would. it have really good ip? yes, it does. but their business model is very different from nvidia. if i am apple, and i am buying if i am apple and i am buying from arm but i am competing against nvidia, how does that work? so could it happen, sure. stranger things have happened. but we cannot see the really good business decision behind something like that. it mayway, i also think have antitrust issues as well, because i think samsung, qualcomm would all say that does not make much sense. alix: i think it also brings into the spotlight semis and other parts of tech that are not
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apple, facebook, google, and amazon -- there was a great piece in bloomberg opinion saying i believe the bond rally was a renewed bond in stocks. is that what the bond rally tells you or not? and you can still sort of go looking for other areas? mark: i am not sure that is what the bond market is telling you, but we think we can go to other areas. not apple,ertainly facebook, google, and amazon, but they have been on a really good run. nvidia is one company. it has very valuable stock to be able to use. but there are certainly places that, i think, have been overlooked by some investors that really should not be. would lead you to believe there are certainly other places to be looking. a quick question before we
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leave it -- if we get a blue wave in washington, how much more tax are these tech companies going to be paying? mark: well, the taxes will go up. i think there is no doubt about that. i think specifically it would appear that the democrats will be keenly focused on making sure they pay something. i do not think it is going to be outsized. i also think that -- i am not convinced that, if a blue wave happens in november, it is something that is going to happen immediately. let's not forget that the republicans were not able to do this very quickly either, to lower taxes. so i think raising taxes would take some time. go up andwould go up, a lot of different areas.
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technology would not be the only sack their that would be disadvantaged by it. i do not think the disadvantage would be outsized, i just do not think they will get that through. guy: mark, great to share some time with you. mark stoeckle, adams funds ceo. let's move on and talk about what is happening in logistics. xpo logistics is seeing a rebound in demand for its truck services following a temporary shutdown of the entire industry. it is one of the top 10 transportation logistics providers in the world. its ceo is brad jacobs, and he joins us now. watching washington, we are all trying to figure out exactly what happens if we do not get another stimulus package out of d.c. what would that mean for your business? how important is government stimulus right now to keeping the economy going? brad: it would certainly help,
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but it is not the end of the world if it does not go through. we just had a quarter where there was modest stimulus, but ofregenerated free cash flow $121 million. and we saw sequential improvement each month of the quarter. so the trend is positive. alix: walk us through what was moving. brad: so the biggest amanda was in our last mile business, where we had 3% organic revenue growth year-over-year. provider ofargest last mile statistics for heavy goods in north america. so when you are buying a washing machine or a television or in exercise equipment or home improvement, we are more likely not to be -- we are more likely than not to be arranging that. that business was up this quarter. guy: do you think that
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continues? -f that - brad: i think yes. i think people will still be indoors for a while. they will be improving their homes and apartments and will be exercising, and i think there will be more demand for that. i think that is a trend. and, by the way, everything e-comm related was on fire during the quarter. it is our biggest vertical. e-comm in europe, where we have the largest equal filming we had hugere, rivers business, returns business -- that business has gone up quite a bit. alix: something we talk a lot about here on bloomberg television is the difference between how europe and the u.s. dealt with the virus in terms of its stimulus and support of workers and how it positioned those countries coming out of the pandemic -- are you noticing
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that divergence on the ground in logistics? brad: 100%. our european business is far ahead of our north american business. the recovery -- they started earlier than us, but they also nationwide lockdowns. they are almost recovered. not fully, but almost. we have some parts of our european business that is actually higher than it was a year ago. the in the states, we see beginnings of recovery, but it is spotty and not anything compared to europe. guy: do you think that trend continues? again, i am wondering what becomes permanent as a result of what we are seeing in covid-19. brad: a lot of that depends on behavior. there are things we can control, in terms of how we react to the virus, and i am very encouraged that the conversion rate from getting sick from this awful
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disease and actually dying is going down. so the therapeutics are fantastic. butforbid you get covid, you're better off getting it now then a few months ago. and vaccines are on the horizon. i was on a call with the ceos of andbig pharma companies, they are working at lightning speed to have vaccines in a few months. now we have to get everyone say take the vaccine, which will be the next tumbling block after that. alix: what role will you play in the distribution of vaccines? in my interpretation if you're on a call with them, you will be part of that. brad: we will play a part in the logistics and distribution, in the warehouses to get it from here to there. that is what we do. we are a company that moves in the mosta to b efficient way, and we have 800 warehouses in the midst of that supply chain to make it more efficient. everything that is going on in
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e-commerce we are facilitating. ourmain thing driving growth is outsourcing trends. so companies, more and more, are throwing their hands up and saying, look, we need to outsource our transportation, someone who dresses full-time for a living. companies like xpo logistics. that will continue to drive the growth of the industry in the coming years. on that call with a pharmaceutical ceos, what are they telling you about the timelines that they are working to in terms of delivering the vaccine? what kind of messages are they giving you in terms of when your services will be required in order to get this out to the population? brad: they are very, very proud of something that usually takes about 10 years will rollout within a year. the speed of developing and testing and making sure the
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vaccines are safe and then manufacturing billions and billions of dosages is a monumental project. it may be the biggest project humankind has ever worked on. and they are saying they will have hundreds of millions of dosages in the next several months and that each one of them will have over one billion dosages next year. so to vaccinate 7 billion people on the planet -- and some will need more than one vaccine -- that is in sight. that i do nothing that lowly done within three months, six months, nine months. i think it is a second half next year of event. but i have been surprised on the upside of the speed of which they have been working on this. alix: when we hear from drug manufacturers, they say that manufacturing processes, like the little glass vials, are what they are missing. what are your hurdles? if you had a lead time of nine months, how quickly can you fix it? brad: i think the logistics,
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while huge and complex and daunting -- we can handle that. the main gaining factor is making sure the vaccines are safe. they are all doing trial tests now, taking 30,000, 40,000 patients, give half of them the real deal and half a placebo, and they do not tell who is getting which. they are doing this in places where there is a lot of covid activity. then they will see, pretty quickly, what the rates are between the placebo and the actual vaccine. and they will see very soon, within months, which ones work and which do not. i am optimistic about the vaccines. i just think we have to be realistic about the time it takes to get all that done. i think it will be roughly nine months to 15 months. alix: we really enjoyed catching up with you. logistics ceo.o coming up, glaxosmithkline gets the biggest investment yet for a
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vaccine. we will talk about that with roger connor. this is bloomberg. ♪ ♪
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live from new york, i am alex deal. guy johnson in london. this is "bloomberg markets." two-putt $1 billion is pledged -- $2.1axosmithkline billion has pledged for a glaxosmithkline vaccine. joining us now is glaxosmithkline's roger connor. we were just speaking to the ceo of xpo logistics. what are using on your side? roger: good to talk to you. everyone wants to know the timeline. towill take a number of time
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get there. we are going into critical clinical trial starting in september. we will start our final clinical trials, assuming those go positive at the end of the year, we are expecting approval of this vaccine in the first half of 2021. there is a chance some doses earlier could be available for emergency, but we are expect and expectingrst half -- that approval in the first half. guy: how does that money the u.s. pledged get spent? roger: in terms of the $2.1 billion issued for funding today, the split -- just over half of it is for research and development. clinical trials are very expensive. tens of thousands of being -- of people being tested. we are spending that amount in terms of clinical trial
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investment. the rest of it is actually manufacturing skill. delivering acal is vaccine that is safe and effective but being able to make it at scale. investing enough manufacturing capacity, buying raw materials in advance -- it takes months to manufacture. assuming charles are successful, the minute we get a go, we have product sitting in -- assuming trials are successful, the minute we get a go, we have product sitting in vials, ready to go. alix: are you looking to make a profit? roger: we will price it thoroughly, everyone to make sure this is a -- and we want to make sure this is a global vaccine. going to significantly discount it. for any profit we make in their
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short-term term, we will reinvest that in a number of things. reinvest it in research into the coronavirus for the future. secondly, invest it in pandemic preparedness capability, so this does not happen again, or if it happens again, we can go even faster. thirdly, donation purposes for the developing world. guy: where does that manufacturing go? where does this stuff get produced? element that gsk is manufacturing is actually a proven component of a vaccine. we have a supply chain in existence. it does not operate at the billion-dollar dose next year, but our particular supply chain is in the u.s., in europe. coverage, and those manufacturing sites will be investing in building that
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cap ability up as fast as we can -- cap ability up as fast as we can. alix: who gets at first? roger: we believe it has to be globally accessible in terms of our overall approach. we know, though, there has to be investment at risk, so this is why investment from the likes of the u.s. and the u.k. is critical. sharinge investing and the risk of the manufacturer. who gets at first in terms of timing? a lot of that will depend on the regulatory environment. who approves it first and allows it to be used. that will play out over time. of -- we willerms all want the first dose. the race is certainly on for that. and is your expectation
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terms of will i need a boost every year? will i be seeing these investments today still being used, the capacity, still being used in five years, 10 years time? i am wondering about the longevity of the investment. the question. vaccines could hate differently -- could behave differently. so how technologies perform in terms of efficacy, how many people actually get the required level of immune response, then also how long does that protection last four is key. also which sent of the population gets it. we know the highest risk for covid-19 is elderly. how that vaccine performs in that population is key.
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the technology we are using has a track record of giving that broader and wider protection in both population and in duration. it will be fascinating, over the next number of months. we will start to see head-to-head comparisons of which vaccine creates that efficacy, who gets that duration of protection. that will answer your question in terms of is this thing that will be seasonal and keep coming back or can we prolong this protection? guy: we will leave it there. good luck. thank you for your time. roger connor of gsk. this is bloomberg. ♪
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live from new york, i am alix steel come along with johnson in london. this is "bloomberg markets." signs the housing market is a
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bright spot in the struggling economy. taylor morrison saw a demand with homeowners -- home orders up 80%. ceo, sheryl and palmer, joins us now. always great to get your take. if you walk us forward, the biggest question in my mind is, as we have millions of people intentionally losing $600 a week , starting tomorrow, what does your business look like in six months? good morning. good to see you again. obviously, the strength in our industry, i think, has been somewhat really unexpected and very good. their strength coming from consumers -- really across all age groups -- we have seen a lot of strength in first-time buyers. today, the ability to buy a home, if you have the ability, the down payment is more
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affordable than even rental rates, so we are seeing very strong demands of people pushing out a multi family into single-family. we are also seeing it across that first move up your people see -- people need more space because the kids are home. we are seeing it with active adults who want to make sure the balance of their journey was a good and positive one. obviously, unemployment is always a key factor in homeownership. the consumers have an effective have been more renters than homebuyers. fromare people moving urban to suburban? yeah, we are seeing that, and the last time we talked, we said we were hearing a lot about that. there was a lot of discussions on our sales floor. today, that has moved into real activity, and we are seeing our buyers make that move. i would tell you that,
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generally, that is coming because there is another reason, there is something else in addition. it is not just this life from urban, it is coupled with the desire to have more space, and what we are really hearing from our buyers and shoppers is the need for enhanced technology. important, our healthy home features, which are why we introduced our team live well, to make sure we could give our help and the confidence in their home they deserve. alix: i want to point out a headline, florida posting another record number of deaths -- i wonder how that translates into the trends in your business. the conversation five months ago was get out of the northeast. now it is our sunbelt getting hit. geographically, what kind of shifts might you be noticing?
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sheryl: to your point, we are seeing tremendous drinks coming out of the northeast into strength- jim i just -- strength coming out of the northeast into florida. that we arelooking seeing a lot of activity from new york and connecticut. truly, the desire to begin their journey a little differently. i understand the numbers are really difficult, but as we look forward many months, i think people will continue that flight into florida. is interesting. it will be interesting to see whether the tax story on federal shares that. fact peopleaout the are looking for advanced technologies within their homes to make themselves safer and
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healthier. want andemic, do people new home rather than a home someone has previously lived in? sheryl: yeah, we are seeing what i would call a strong bias to new. people are so aware of the , the perceived risks of any environment. it does not matter if it is schools or stores. we are seeing a lot of information about planes. even going to the dentist's office, they had to put in new air filtration before they even reopened. if you think about all the touch points in a home, knowing that your new home could provide you health and safety is really top of mind of all of our customers. we had more than one third of our home shoppers say they prefer a new home rather than resale for the in-home and
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wellness features. we are really seeing that amongst the younger demographics. something around 40% of the lineal and -- millenials and genx shoppers, which is why we are seeing those features around clean air, clean water, chemical free paint. alix: is there enough space to build all new homes or is there enough supply in that respect? sheryl: the supply is very limited, both on retail and the new home market. always a bit of a challenge of making sure we can stay in front of the demand. think the buyers choice with existing inventory is very limited, which is why we are seeing so much activity in the home market, talking about new, fresh, clean, safe.
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guy: are you buying land? have you toned down land purchases as a result of what is going on? back to late go march and early april, we are she took a bit of a step back, wait and see, understand what covid was doing, what the consumer impact would be, what the demand was. through april, as you probably saw, that was our low point. in may, we saw nice year-over-year growth. in june, over 90%. as you can imagine, with a kind of sales we are seeing, we are absolutely out in the market, very active, acquiring land. it does not mean we do not do it carefully. we make sure the core gbits of location, type of land -- core
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attributes of location, the type of land, that is very important in strategy and always has been. we are active in the land market across the u.s.. guy: thank you for your time today. sheryl palmer, taylor morrison homes ceo. up next, we turn our attention to the travel space. an analyst called it the worst border in modern travel history, and it certainly showed in expedia second-quarter results. we will talk about what happens next. the company ceo, peter kern, will join us. this is bloomberg. ♪
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guy: from london, i am guy with alix steel in new york.
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this is "bloomberg markets." expedia shares are down after inir reporting a slump bookings. the ceo is peter kern. he joins us now. i've spoken to a bunch of airline executives over the last few days. they are all telling me the same thing. this is about cash burn management. what is your cash burn look like right now? what can you do going forward to get it down even further? ater: first of all, we are in very different position than the airlines. they come off course, have huge fleets, huge organizations, and a lot of stocks. we are different than that. we raised a different -- we are different than that. ofparticipate in all aspects the ecosystem, so air is very challenged, and i feel for the people working in those
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industries, but we have participated in the alternative accommodation area. ,e participated in the hotel which has been stronger than air. it is a much different case for us, but we are fine on cash. we had already undertaken significant cost-cutting effort in the beginning of the year before the pandemic hit. we certainly accelerated that. we have gotten our cash burn greatly reduced. we raised a significant amount of capital earlier in the year. we are quite comfortable with our balance sheet right now. extend -- thes deferred payment system where you then have to return payment -- payment from people who ask he booked a vacation -- if that gets worse for you, how much room do you have to cut, in terms of costs? we are looking across the
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entire company. we announced earlier a goal of $500 million in savings, which did not even go into our variable cost profits particularly we are already at a run rate of $400 million in savings, and we expected to weaning fully better than our goal. we also have taken cost out of the variable side on the call center -- variables i, on the call center side, technology on the profits and -- processing size, and even advertising, where we expect to be much more efficient in our performance marketing in the future. there is a lot of opportunity for us to take costs out. but i will say that whole notion of deferred bookings has settled down. it was particularly acute in the back half of march and april, when nobody was booking travel and everybody was canceling. but that has considerably changed in the last few months.
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even in july, with cases returning, it is not growing at the same rate it was in june. but it is in a fine place for us to sustain ourselves, so we are not particular concerned about that. much of that effort booking has burned away anyway, and we feel good about where the business is . obviously, it is greatly reduced. as you pointed out, the quarter was terrible. of course it was -- it was not a surprise to us or anybody else. what matters is where we are now and what we will look like when the business returns, so we are spending all our time on that, making sure we are efficient when it comes back. returnsn the business -- let's talk a little about that. what does it look like? we have spoken to a logistics guy in the past hour who talked to us about rolling out the vaccine. he will be responsible for that
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in terms of moving it. we just talked to the head of ,accine at glaxosmithkline again, late 2021. clearly, the vaccine will be a major part in the way we turn around our behavior. when do you see it coming? what are you looking at in terms of a return to normal? peter: i would say -- not to be trite, but we are planning for the worst and hoping for the best. obviously, they are more informed about the likelihood of the vaccine and timing -- that is the panacea for all of this. clearly, when we have a vaccine and it is widely distributed, we have little doubt the world will go back to traveling quickly and return to normal. and happens between here there, whether there are therapeutics, which there is a lot of hope for, that are effective before the end of this
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year, whether people are comfortable with that -- it will be a combination of what people are comfortable doing and how science is coming along to protect them. i think we are seeing more and more ways -- last night, the nba started. we are seeing more and more ways people are adjusting and figure out what is possible. we are seeing that in travel. that is why the vacation rental business has been stronger. but we will see it in other areas. hotels are doing a great job on safety. people will have to get comfortable with that, but they will. are airlines and airplanes much more safe around an air quality standpoint than people have historically given credit for. people will increasingly get comfortable. that will give us a bumpy but positive ride over the next some period of time, and then we will get to a vaccine, and things will normalize. alix: in talking to analysts, what really seems to concern them is that interim period of
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when you have to keep cutting costs, to keep cash in hand versus than losing market share, so when there is an uptick and a recovery, you will not have the same kind of exposure that airbnb does or bookings does that has more direct traffic on mobile platforms -- already squash those fears? peter: first of all, we have a ton of direct traffic. the majority of our business in this period, as we grew out of april, has been through direct traffic. all of our brands have great followings in different parts of the world to different degrees, so we are not at a real deficit to anybody. was we said on our call are being careful about waiting in. in -- wading back the business one gets through performance marketing has been much, much smaller. what i said is we are working on foundational work to get ready
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for most robust -- much more robust times. there is a lot of foundational work we need to do, but we are not giving up share. we do not think we will cede share for the long term. have every confidence that we will not give up share. in fact, we have demonstrated, during times like this, when people are looking for information and choice and price, they come to us and they want to find the right answer for themselves. guy: you bring a performance marketing, so let's talk a little about it. what do you make of google's performance on the hill, and is this an opportunity for you to reset your relationship with the tech companies when it comes to the amount of money you are spending on performance marketing? peter: i think there are two
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parts to that. the first is that we are perfectly happy for the regulators to take a close look at fintech. we have been public in our view about google advantages their own products, etc., and have done at the expense of their customers. we have been clear with them about that. but we have to do what we have to do, and we can only affect andimpact on the options performance marketing, and we have a lot of opportunity there. we think we can drive more direct traffic -- trafficking. we think we can be more affected by combining our brands and using a bear portfolio approach which we have never done before, so we continue to believe in that business. for us to keep driving but, clearly, the deck is stacked against us, and we are more than happy for the regulators to take a closer look at trying to
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contain that never-ending move towards inequity, in our opinion. alix: how big of a competitor do you view google as? google as anot view competitor. i do not think they want to be in our business. they are trying to extract as much money out of industry, but they do not want to actually book travel, helping a traveler through flight cancellation or hotel cancellation or bad weather, etc. i think google is smart about wanting to be in the things they are good at and control everything through technology notscale, and they do want to mess with customers. we actually want to take care of customers and help them along their journeys, and i do not think google will go there. whether they unfairly taxed industry in the way they conduct their operations is another question, and that is what we
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have issue with, but i do not worry about them as a competitor. alix: and i want to get insight on the working environment. there has been a lot of conversation in washington, d.c. about not wanting to extend the $600 unemployment benefit and wanting to reduce it because it is reducing workers from going back to work. are you noticing people not wanting to come back or do you not want them to come back? peter: it is not a problem for us. i've heard in the industry, hotel industry, etc. there are a lot more workers in some of those industries are at the bottom of the weight scale, and there has been some dislocation because of how those dollar values were set. for us, it has not been an issue. we would like our employees back as soon as our business can support it, and we have furloughed a relatively modest amount of people. we are looking at other ways to
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do short-term mitigation but long term, obviously -- it is not an issue for us. it has not affected who has come back or who is willing to come back. guy: how does it help? peter: how much has it helped? it is a question of how it impacts travel. my supposition is that generally helps people who needed the most, and those may not be the first to want to travel. the question it is how much will it stabilize the economy? travel as a reflection of economic capacity to do it. people love to do it -- they will extend their credit card and do other things to make it possible. i think it is a good thing. it is positive to hold up our economy. i will leave it to the to find thefficials right balance, but the economy is stable for now, and to come out of it is super important for
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any consumer business, and we are a consumer business, at least in large part. so i think it is important work. i hope they do something to help people in the u.s. whether that has any short-term impact on them, i am not sure, but i think long-term health will keep the economy moving and people -- keep people safe and fed. lot. thanks a peter kern, expedia group ceo. and we are waiting for mark meadows, the white house chief of staff, to join at a daily press briefing. that should take place and a couple minutes -- in a few minutes. we are looking for some sort of clarity in what the government will do. the republicans want some sort of boost and leave a comprehensive il for later. democrats are against that. it seems like the talks are ongoing but they are so far apart. hopefully we get some sort of clarity here. think that would be
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well received. i wonder if the markets are really pricing in the risk, on a day like today, if this does fall apart. clearly, this is something that needs to happen. you cannot leave this many people without access to this kind of funding at such a critical moment. this is absolute pivotal. when you take a look at what has happened over the last 24 hours, 40 eight hours, from company to company, businesses we have talked to and our colleagues have been talking to, many of the numbers posting right now are a direct result of what is going on in terms of the government support. maybe not direct weight individuals but broadly to the economy. this money trickles down. there is a velocity of money argument here. it is critical that the market, and governments, appreciate the real risk of what is happening here. alix: bank of america had a great analysis that they have
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held out here, and they talk about how much money will be lost in two weeks. ther you wind up having $600 loss from the economy. it was truly staggering. they say you could see a decline in income of about $18 billion a week. huge. and when you saw the income numbers today, incomes were down and spending was up, but the savings rate is also coming down, so you wonder how much of that buffer is there. then let's pretend you make it up, and in two weeks, $18 billion comeback -- will those people really spend it, or do you save it, because you do not know what will end up happening in the next three months? you do not know if there will be an extension. i think this poses, even psychologically, a really difficult scenario for consumers. like you said, the market seems to be ignoring -- on the flipside, what do i know? because apparently everyone bought ipads last corner--
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quarter. guy: i think that is their own demographic to be looking at, but there is a line between these demographics, and that is important to look at. you also have an election coming up as well, and it is tough to think about an election, if we do have this kind of scenario unfolding. alix: we are now speaking with mark meadows here. and: secretary mnuchin myself, with democrat and republican leaders, both in the house and the senate. last night, we concluded a meeting with senator schumer and speaker pelosi a little bit before 10:00. and, at the president's direction, we have made no less than four different offers to democrats on capitol hill on how we can make sure that the enhanced unemployment that is set to expire today, along with
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eviction protection, set to protected.ell, is those four different offers have been rejected. more importantly, they have not even been countered with a proposal. the democrats are certainly willing, today, to allow some of the american citizens who are struggling the most under this unprotected, and the president has been very clear for us to be aggressive and forward leaning to make sure they get protected. and yet, what we are seeing, is politics as usual from democrats up on capitol hill. , when weses me that talk about compassion and caring about those that truly are in need, that a temporary solution
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,o make sure that unemployment enhanced unemployment, continues has been rejected not once but multiple times. the democrats believe that they have all the cards on their side, and they are willing to play those cards at the expense of those that are hurting, and we will continue on with additional discussions today with senator schumer and speaker pelosi. perhaps an in person meeting tomorrow on capitol hill as we stay engaged, but i am in what we have experienced over the last three days, and i want to stress that the democrats have made it zero offers over the last three days. so in a spirit of compromise, the president has sent us back not once, not twice, but three different times to try to find
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common ground, and what we have found from our democrat negotiators is that they are bumping the price higher than the very bill that they passed out of the house several weeks ago. to give you a particular example of that, in their heroes bill, they have $100 billion for schools. and,tched that offer actually, put forth a proposal for schools,ion for k-12, and higher institutions. and yet, what did they say to that? that was two months ago, we want to increase the amount of money we send to schools to $400 billion. we are going in the wrong direction. they are going in the wrong direction because of partisan politics. it is very disappointing. so we call on capitol hill to get serious about their negotiations.
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the president is serious about the negotiations. we are willing to engage. as you know, lita mcconnell, yesterday, put forth a one-week extension, at the current level, for enhanced unemployment. and what did we see? senator schumer objected to that. there is no clear message the american people should receive other than the fact that the democrats are willing to play politics at a critical time in our nation's to give you that brief update so you could have it straight from the negotiations as they happen over the last three days. the pressn it over to secretary. toyou have been listening mark meadows, white house chief of staff at the daily press briefing. seems to be very angry saying
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the talks between him and chuck schumer and nancy pelosi not doing very well. they gave four different deals to the democrats and were rejected every time. i don't have any clarity on what those different deals are. that boils down to longer-term unemployment enhancement. it ends today. it will leave a lot of people on the chopping block and evictions will become a big issue within the next few weeks as well. the s&p down 2/10 of 1%. you don't see a ton of reaction within the equity market. this is really key in the u.s., you don't get this, we will lose a lot of income for a lot of people. that will be disastrous for spending. no real insight into what those plans are as of yet. clearly they are in the partisan posturing world for both sides. guy: absolutely. it has been fascinating to watch what the dollar h


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