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tv   Bloomberg Business Week  Bloomberg  December 18, 2016 4:00pm-5:01pm EST

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carol: welcome to "bloomberg businessweek." i am carol massar. oliver: and i'm oliver renick. we're coming to you from inside the magazine headquarters in new york. this issue, light is so impossible to take national line -- the long shadow that may follow president-elect trump for treasury secretary. oliver: all that ahead on "bloomberg businessweek." ♪ carol: we are with megan murphy, editor in chief.
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an opening remarks you guys take a look at energy, looking at the social cost of carbon, something the obama administration had come up with. megan: this story is pegged off of what we see in donald trump's cabinet. he has put a lot of climate skeptics into his cabinet. we looked at how they pegged the social cost of carbon, originally set at 24,000 per metric ton and has increased over time. we are tracing the development of that. what they wanted was an economic estimate of the cost of climate change to society. how you could peg that, and what people are questioning now is what can donald trump's new administration do if they are going to advance policies that would roll back this clean power? what could they actually do? this number is one that many economists on both sides see as arbitrary, difficult to peg, and
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something he would not be able to undo, but still underpinning. oliver: speaking of energy, another big pick is rex tillerson for secretary of state. ceo of exxon mobil. in the politics section, you talk about his relationship with russia. tell us about that. megan: russia has dominated the news cycle since donald trump got elected because there has been so much about whether or not russia influenced the electoral outcome. the cia said they do think russia was actively trying to influence the election. any of his pick's ties to russia will be under close scrutiny. rex tillerson is a fascinating choice as secretary of state. his ties with exxon mobil to russia go back some time. in 2010 he was awarded a friendship medal from vladimir putin. they have the deal to explore in the arctic. drilling that has not been able to manifest itself because of
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sanctions on russia, but that is worth many billions of dollars to exxon mobil if the sanctions are relaxed and they are allowed to deal. they have a joint partnership with rosneft. what is going to be the key in these confirmation hearings -- we've had republican senators, marco rubio, lindsey graham, john mccain coming out strongly and saying i'm not sure we want somebody as secretary of state who has embraced vladimir putin. not only as a friend but someone you can do friendly business dealing ways -- dealings with. donald trump has been incredibly consistent about appointing people to his cabinet who he thinks have executive-level experience. that is something that makes people in washington very uncomfortable. rex tillerson is going to be under heavy scrutiny. carol: another member of donald trump's team, steven mnuchin. president-elect trump has lauded him as a great businessman. we actually take a look at that in this section. megan: we do take a look at that. we look at his relationship with
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a branch of a bank that he was involved with that was very heavy into something called reverse mortgages, which people will be familiar with. basically they allow you to get cash out of your home, mostly targeted towards elderly people who are sort of ending the term of their mortgage and want to actually release the equity in it. it is a product long thought of to disproportionately target elderly people who do not have the best finances. it is something that has come under close scrutiny. they use the word "dodgy." this is a part of his financial history that i expect to get a lot of scrutiny as well. one, mostly because steven mnuchin, former goldman sachs partner, but this is something that targets poeple in a way they know and can relate to. when you think about your mother and your father or your grandmother in your grandfather being exploited, that's going to be interesting to see how that plays out.
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oliver: we talked about it. >> his last job before working for the trump campaign, he spent six years running this bank in california. essentially, the bank was a complete disaster. it collapsed and had been taken over by the government in 2008. it was called indymac, it was founded by the same guy who ran countrywide. and like countrywide, just had a terrible record of making loans that put it in -- got it in trouble during the housing collapse. mnuchin came along in 2009 with a group of billionaire investors, he rounded up this group of investors and put $1.6 billion in to buy this thing. george soros, his old employer, john paulson, who made a fortune shorting the housing market. he was going along.
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michael dell was putting money behind this, and a bunch of old friends from goldman sachs. and they got together and bought this company out of bankruptcy , almost, out of fdic control, and turned it around, and it was a staggeringly successful investment for the investors. they made a fortune. oliver: but there is a catch now. carol: he sold it, right? >> that's right, last year he sold it to his former colleague. so, it looked like a big success, and from a financial perspective from the investors, it definitely was. it was a fantastic investment for them. oliver: but as cit started going to the numbers, what started to crop up here? what is at the crux of your story? >> just within a few weeks of cit closing the purchase and owning this bank, they started realizing that there were problems. they got subpoenas from the u.s. department of housing and urban development investigating their
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reverse mortgage business, which was just a small part of the bank that mnuchin had sold them. when they started looking into this, they realized the books were a mess. they had no idea how much money they had to set aside for various problems, and eventually they had to set aside $230 million more than they had thought. so, it was kind of an unpleasant surprise. carol: the auditors found an "material weakness" at the unit doing those reverse mortgages. the reason you do this story is because president-elect donald trump has put out steven mnuchin as his nomination as treasury secretary, and lauded him as a good businessman, so you're looking at what was one of his business ventures that was not so great and did not have such great oversight.
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>> right, to be clear, from mnuchin's perspective and his co-investors, it was fantastic. carol: they made money. >> we estimate he took something like $380 million out. between the dividends and the sale to cit at the end. steven mnuchin has a long career with a lot of success in it. he financed "avatar," worked for 17 years that goldman sachs, where he was a partner in part of the management committee, but this is something -- his last real job left a blemish on his record that was only really discovered after it was sold. oliver: up next, how the trump administrations threatens a crucial safety net that is dependent by many in rural america. carol: we will tell you about a new approach that workers and companies are taking to retirement. ♪
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carol: welcome back to "bloomberg businessweek." i am carol massar. oliver: and i am oliver renick. in the politics and policy section, the single biggest program impacted by trade is social security disability insurance. carol: but that could change under the trump administration. our reporter traveled to one of the most vulnerable regions in the country. >> if you pay into the social security fund, you have access to a trust fund for disability insurance, which means that if you become sick or injured on the job or not and you are no longer able to complete work, then you are eligible for a monthly subsidy. this program has been in place since 1956. the challenge right now is that in the last 20 years or so it has grown from 2.5% of working adults to 5.2% of working adults. that is a national number. when you begin to look at the regions where this is most prevalent, then you get a better sense of what is going on, which is that for a number of
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different reasons, they seem to be most prevalent in areas that do not have a lot of economic opportunities. disability should not go hand in glove with unemployment. you either get sick or you don't. you get injured or you don't. but what we are discovering is that a lot of people who would otherwise be eligible for this program but don't apply for it when the jobs go away, they do apply for it. carol: people will open up the magazine and see a map of the united states. walk us through it a little bit. you highlight certain areas of the country. >> that map shows what some economists call the disability belt, the appalachians, in some parts of the mississippi delta, and a spot between the borders of arkansas and missouri, northeastern arkansas
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and southeastern missouri. so these are rural areas, areas where the work that was there, very physical, tended to be economically depressed areas. you can look at national trends, and i talked to the chief actuary for the social security administration, and they said there is a good case nationally for the fact that demographics is driving this growth. we have had over the last three decades is that women have entered the work force and are now eligible for disability, so they can apply for it and draw down from that fund. they said it happened exactly as we predicted. workers are getting older, so we are not just talking about retiring workers, but the tail end of the baby boom, in its 50's, but still able to, but not able to work because the older you get, the more likely you are to have an injury and be unable to work. the social security administration says mostly demographics. the problem is, you look at that map and say, i don't see demographics. i see lack of economic opportunity. carol: what is interesting, what popped out as me and as you look
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at this map, you look at different counties. buchanan county, virginia, dickinson county as well. you highlight that the county is 95% white. buchanan county. in dickinson county, 98% white. what was the point here? >> i think the politics of this are pretty tough. i think that when we look at programs, they are race-blind, but when we talk about welfare, aid to needy families, it tends to be race-based. when they describe barack obama as the welfare president, it is a coded word for race. what is interesting about the disability program is that it is most prevalent in white areas. when you talk to people who live in cities, they tend to not even be aware that this program exists. it is very much a rural program, and there is a fine line between saying people are applying for
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jobs because there is no economic opportunity anymore and people are applying for jobs because health outcomes tend to be poor in these areas. because the work that was there, tended to be very physical, so the point of pointing out the ethnicities of those counties is to say that when we talk about government programs, there tends to be a racial component, even if we are not bringing it out in the open. carol: shifting gears, a new and gradual approach to retirement. >> it's called phased retirement. and it means you gear down instead of suddenly one day and announcing you are retiring, and then two months later you are completely out. you switch to a part-time reduced schedule, but you are still in the workplace getting used to the idea of retiring. carol: it is a win-win for the employee, who is nearing retirement, as well as the company, is it not?
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>> right, many companies have large numbers of baby boomers who are exiting all at once. they have enormous knowledge, they understand practices, procedures, people, and they need to teach that to the younger employees, they need to pass on what they know. if they just leave with all of that knowledge it is a huge gap. oliver: why is this a story right now? is it because there is a gap between the supply of workers, between the baby boomers or generation x or z or whatever it is now? >> absolutely. you have baby boomers hitting 65 every day, and will be for the next 16, 17 years. that is the traditional retirement age. people are working more sometimes, but other people want to leave at 63, so you have companies with large number of boomers who are all exiting at once. one is steelcase, a big furniture manufacturer in grand rapids. they have a plant out there that makes desks and filing cabinets.
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5000 pieces of equipment a day. they will lose one quarter of their workers over the next three to five years. carol: you talk about one person who has worked at this company for a long time. talk about how he worked it out. >> he is a principle of electrician, one of their best electricians. he is hitting 65 in february. he mulled it and they did not want to lose him. he sat down and talked to his boss. he initially wanted to go on a reduced work schedule where he would have thursday off and friday, and his boss said that is not going to go because those are our busiest days of this plant, and often the equipment is being repaired on saturday, and that is what he does. they worked it out and he is now taking off mondays. he has gone from six days a week to 30 hours a week. oliver: is it all a smooth transition in his experience? emerge,e any rifts that
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are there any kinds of speed bumps? >> there is adjustment on everybody's part. you have bosses have to get used to flexible schedules, but also the people that were doing this are used to being in charge, and they have to step down and let go. one of the people i talked to, he is only working one day a week on a very specific project. he really took care to leave his office and say i don't need my office anymore. this office goes to my successor, and i now have to sit in a cubicle carol: volkswagen goes through a huge cultural change. oliver: plus, why the american dream all has been a nightmare. ♪
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♪ oliver: welcome to "bloomberg businessweek." i'm oliver renick. carol: and i'm carol massar.
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you can also listen to us on the radio. am 113.0 in new york. 960 in the bay area. oliver: volkswagen's emissions scandal leads to a reboot of the corporate culture. you chose to start your story with an anecdote that took place several years ago in 2014 in a gaudy setting, paints a picture of what volkswagen used to be like. tell us why you chose to start with that kind of imagery. christoph: yes, the new management that has been put in charge to steer the company through what is effectively the deepest crisis and the company's history is trying to more than just resolve the scandal or fix
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the cars, pay compensation to car buyers in the u.s. they are also trying to turn the company at the moment, rein in what is pretty much unrivaled and excessive spending compared to pretty much all other automakers, and they are trying to turn and make the company leaner and more flexible, because as you know, the entire auto industry is facing age or dramatic shift towards electric vehicles with features like autonomous driving, so that is a pretty long, comprehensive list of things they need to address, while at the same time trying to digest the financial hit from the diesel scandal. carol: talk about some of the crazy things going on at the company. they jumped out at me when i read it. kind of the company's culture, you talk about a garden center where employees can order flowers. there is an in-house butcher, 3400 caterers at the company. i guess none of us realize the
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excessive nature to volkswagen. >> they have been keeping pretty much everything they do and related services in-house. almost all other car manufacturers have been outsourcing services like that, but volkswagen has always resisted that, partly because of the role the labor unions play. for historical reasons. they also have a vital interest to protect jobs, and that has led to some of the excessive results, if you want to put it like that. where like a sausage factory, a flower service, a postal service is still run from the company itself. carol: can i just throw out one stat, volkswagen employs 80% more people than toyota to produce roughly the same number
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of vehicles. so there is a ton of excessive headcount there. >> yeah, there totally is. i mean, volkswagen worldwide employs about 620,000 people, 121 factories, more than any other automaker. the key reason behind this is because they still manufacture all sorts of different parts and components in-house, whereas companies like general motors, ford, has outsourced the manufacturing of parts and components which are not critical to the individual brand. outsourced to external suppliers who can produce these items at lower costs than the manufacturer in itself and that is something the company is currently trying to resolve by sort of bundling the component operation into one big organization, but there needs to be something to get the cost down. carol: speaking of reboots and remodels, the troubled story of the american dream mall in new jersey. oliver: we spoke to reporter
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susan. >> right now construction is underway. it has been stalled for a while. financing is still not entirely in place. it will take billions more to finish. it has already taken $2 billion to get to where we are now. where people in new jersey know where we are and have been for quite a while. the opening date is autumn, 2018. carol: take a step back because it sounds like third time is a charm. this is the third developer who is trying to get this mega-retail entertainment complex in the meadowlands. this is supposed to be a huge development, but it's had a lot of problems. >> it started in 2004. xanadu. it was called xanadu. it was meant to be shopping and entertainment. the big feature was an indoor ski slope, which you can see from the turnpike, not complete, but you can see the frame for it.
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that was kind of the main feature, then the group that was developing it ran into financial trouble and they walked away from the project. another developer came in and ran into the recession and they had to walk away from the project, and then there it sat. ski slope, kind of a hulk of a structure in the meadowlands with hundreds of millions of cars driving by every year, but no one could finance it. then finally, governor chris christie, who probably if you live in new jersey, you know he once called it the ugliest damned building in new jersey, maybe america -- one thing you can agree with him about -- but when he came into office, he looked at it in and said, you know what, these developers have already put $2 billion into this. if we can get it going, we can create a lot of jobs.
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there are promises of big economic benefits to the region. carol: it is a good location, it's right outside new york city. >> it's convenient, and there is a train link that goes to the stadium. i mean not direct, but it will go to the stadium on game days. it seemed like a good idea to try and revive it, so they brought in a third developer, triple five based in canada owned by a family who also runs a little shopping center you might've heard of -- the mall of america and the west edmonton mall, which is in their hometown. so, they have been working on this project since 2011. they have greatly expanded what was already huge to include an amusement park, and a water park, and they are redoing the inside and adding all kinds of things. carol: up next, the challenge of preventing tainted seafood from washing up in american supermarkets.
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oliver: that is next on "bloomberg businessweek." ♪
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private wifi for your business. strong and secure. good for a door. and a network. comcast business. built for security. built for business. ♪ oliver: welcome to "bloomberg businessweek." i'm oliver renick. carol: and i'm carol massar. still ahead, can can app for tickets beat out scalper bots? oliver: if you ever bought our work on a cruise ship, prepare to get seasick. carol: and tainted seafood. what's behind it and what is being done about it? oliver: all that right here on "bloomberg businessweek." ♪ oliver: another must-read in this week's magazine. the cover story titled "bad shrimp."
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this story kind of took me by surprise. i am just curious, when you were going through this what was the first thing that pops out at you? i mean, how big a deal is this? megan: i mean, the first thing that pops up is the context we are talking about is china and where we are going in the global economy. this story really traces have something you do not think that much about, which is when you are eating sea fort shrimp or anything, just the chain it goes through and the problems and what is getting into the food supply. it really presents a tale of an economy that is rapidly transforming and the regulatory environment that leaves a lot to be desired in terms of what actually goes into our food. carol: here we have the u.s. regulators putting tariffs on chinese shrimp and they found ways to get around it. and they continue to do so. >> absolutely, and it really traces through that. i don't know if you would call them loopholes, but ways they have evaded scrutiny.
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not from a lack of intentional malfeasance but the very fact of wanting to get stuff done, and how one supply is making sure they are fishing, that they can sort of have a robust environment but what happens because of that and the contrary effect is that it seeps in and you don't know what is happening and what is happening in the live beds and where these things are living and breathing. and the effect of having a superbug possibility. that is the concern. it almost reads like a movie. seen playle we have out on the big screen before. it reads very much like that, something that seems relatively innocuous but because of lack of regulatory oversight, desire for higher-margin, higher profit and just, frankly, carelessness in terms of parts of the world that have very different standards than we would expect in sort of europe or the u.s. oliver: i am glad you brought it to this overall topic of globalization.
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but let's talk about sort of the science about what is happening , because basically there is this sort of ecosystem that is getting polluted and not in the way that we typically think about it. it is antibiotics working its way through the system, building up in the food we eat. >> exactly, and that is the thing. it is a story about how something is designed to be good and improve the health of certain parts of the ecosystem can manifest itself in ways we don't have a structure in place to deal with it. it sort of morphs and develops and it leads its way through in a way to current system is not designed to catch. we uncovered this tale of how this is filtering its way in the u.s. and other countries in a way that people did not think it could happen. particularly one of the things i really love about this story, and the cover is fantastic, and the imagery of this story, pigs next to discarded medicine and
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discarded antibiotics, and people actually shoveling excrement from animals into the same part of that ecosystem where shrimp and other wildlife is living and breathing. it is a fascinating tale. oliver: it is so true, when i was reading it, i was picturing one of these diagrams from middle school. [laughter] the arrow is going from there to here. it is not pleasant when you are reading it. forl: agriculture worked thousands of years when you start to introduce antibiotics and of the equation. we are starting to be much more sensitive about the increase use antibiotics and how it is creating superbugs and illnesses and problems with people, including death. >> when you talk about globalization and we are seeing it being played out in the western world, we are going to see it play out in the eastern world as well. people move at different speeds. regulators move at different speeds, and economies are moving
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a very difference speeds and they will take the advantage or they can in terms of exploiting regulatory arbitrage. antibiotics there had been introduced because they are beneficial to that part of the economy. on the more developed world side, that is where the products are emerging. that will be a tension that plays out in society. it is really accelerating and i think that of the next decade it is going to be the next big thing, where this arbitrage, is there a need for some sort of global oversight where you have unpredictable effects of what is actually as we said designed to be a good thing? carol: really well said. we talked to the creative director about the cover for this story. >> this story is kind of gross. and so, we wanted to run with that theme. and so, it is obviously shrimp and antibiotics. so we picked a very simple image of two shrimp getting pierced
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with a needle. representing the antibiotics. carol: that kind of creeps me out. i love the lettering that you did. it takes a back to science class. when you did your first dissection. you guys had fun with the lettering. >> that was exactly what we were going for. we have an art director who is a very good illustrator and sort of said, can you make this look like a dirty little microbes and he did a fantastic job. oliver: you went through a lot of effort to take pictures of the shrimp. >> yeah, so, with pictures like this, there are such things as food stylists. and so in this case food stylist's job was to lube up the shrimp and make them look grosser. it was a struggle to get them to stand up on the needle because they kept sliding down. carol: up next, the wild, wild west of live streaming. and the company being the way and the latest broadcasting
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trend. oliver: plus, one developer trying to help the little guy getting a concert ticket without having to pay a scalper. ♪
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♪ oliver: welcome back to "bloomberg businessweek." i'm oliver renick. carol: and i'm carol massar. oliver: in the technology section, facebook does it and so does twitter. carol: so does google and amazon. live streaming. the trend is just starting to take off. oliver: we spoke to a reporter about one of the industry's pioneers. >> 2016 has been a big year that all of the platforms have been pushing live video capacity. facebook has been into it. twitter, youtube live, amazon with twitch. they are trying to get all of their users to do livestream. oliver: and bloomberg on twitter. [laughter] that is a big part of it.
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the corporate element. obviously there are people who can do their own thing. they can stream themselves. but it seems like livestream will be going towards a corporate client. >> livestream is a company that launched in 2007, and they seem well-positioned for the current moment. they sell a bunch of services, hardware, software to anybody who wants to do a livestream and make it look semi-professional without hiring full production team. 2016 has been a huge year for this company. carol: run down some of the companies they are working with. it is like a who's who of corporate america. >> it is amazing how diverse their client list is. at this point, they are up to 10,000 paying clients. i was surprised when i went to meet in with them. into individuals, media companies, who is it? everything you can imagine -- churches, mega churches, a lot
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of them are live streaming their sunday services. radio stations like to livestream with people doing radio. there are big brands. exxon mobil just hired them to do live streaming. tech companies who want to live stream product launches. they have tesla, spacex, second-tier sports teams and leagues, professional bull riders is one of their clients. and yeah, just nonprofits, universities who want to get their professors live streaming. anyone doing a conference these days wants to have a livestream on the internet. ted is one of their clients, the world economic forum is using them. oliver: why does the room for them to take this part of the industry when there has been skype around for a long time , which kind of pioneered the video chatting and back and forth -- how are they able to take this part of the market?
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>> what they have going for them is you have these huge platforms like facebook, youtube, that are essentially giving away the basic services. you can livestream on facebook for free, skype is free. there are these places were organizations can go to do a livestream, but i think where this company livestream is coming from is you can use those services for free, but if something goes wrong, there will not be anyone on facebook to suddenly answer your questions. if you want to monetize it, good luck trying to figure out on your own how to do that. what they say is, ok, for a little bit of money, we will hold your hand and make it look professional and make sure it is reliable. carol: how an app call song kick can improve the live music experience. >> the ceo, matt jones is 30 years old from england. essentially, he was able to start selling tickets directly
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sort of to artists over in england. he promoted people like adele when she was unknown. he had all these relationships and started selling tickets for them. because he had a crowd surge, they could sell 20% of their tickets. they had a lot more control over their business and he made like 10% off of each. what do you do after you conquered england? you come to the u.s. carol: but then you meet ticketmaster and live nation. they are a beast and control a lot of the ticket sales. >> they do. yeah. even before the merger with live nation, ticketmaster -- pollstar estimates they have contacts with 80% of the biggest event venues in the u.s. in england, you know, concert halls let as many as 10
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companies can sell tickets. but in the u.s., ticketmaster negotiates exclusive deals with all of these places. carol: what do you mean places? >> venues, concert halls. they negotiate the deals with the concert halls. there are exclusive. they keep a tight lock on it. oliver: who exactly are they disrupting and who is on their side? is it about trying to break the agreements that these venues have? getting the artist to come on board? >> that's the thing. in england, when you have multiple ticket sellers, you can disrupt that. i guess the artist can use their clout and kind of demand a certain percentage of ticket sales. although that is not exactly the way they put it, ultimately, that is the strategy here. because you know, increasing -- well, the thing about live nation and ticketmaster is that they make their money from
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surcharges. they don't even keep all that money. they kick a lot of that money back to venues. but that is where the profit is. they don't make any money on live performances. that is a really important business for them. at the same time, if songkick wants to disrupt things, they have to break ticketmaster's hold and sort of force ticketmaster to give them more tickets. ticketmaster sees all this and says, we are not giving you anything. especially because you are turning around and selling tickets to the general public. you are trying to start a business on our backs. carol: up next, how the world's biggest art gallery make their money on cruise ships. oliver: and products to keep you flying in style throughout the holiday season. ♪
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♪ carol: welcome back to "bloomberg businessweek." i'm carol massar. oliver: and i'm oliver renick.
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you can catch us on the radio at sirius xm channel 119 and also on a.m. 113.0 in new york and boston, 91 in washington and am 92.60 in london. in the features section, one art gallery has carved out a very successful business selling its art on cruise ships. carol: but are the passengers getting a good deal? we talk to a reporter. >> on all the major crews lines, there is one company called park west, park west gallery based outside of detroit which says it is the biggest art gallery in the world, and it makes its sales aboard cruise ships. on over 100 cruise ships around the world, thousands of auctions every year and has a niche in cruise market and the business.
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i was intrigued to see how that worked, especially since there had been a long history of complaints about these options. carol: you have to tell us what this process is like. tell us what you saw and how they conducted it. >> here is what i did. i read some old lawsuits and the complaints had been they were promising people investment returns on their artwork. they were saying they were getting great bargains and that people were coming ashore and learning that i cannot sell it for as much as i bought it. i went on as a passenger to attend auctions and see what would happen with these controversies in mind. and what was interesting, event after event, they passed around the champagne and they would butter up everyone and get a
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good spirit going, and every one of these auctions, they were saying the retail value is $4000 but we will start the bidding at $3000. i wanted to know if were getting a good deal. and after a series of lawsuits, park west gallery changed its ways. my thought was it was a mixed bag. oliver: what is the art exactly they are selling? give us an idea of what type of pieces that people are buying. if people follow the art world, are they going to recognize any names? what kind of stuff are they selling? >> i mean, it is a full range of stuff. you can buy a piece of art for $50. you can buy something for $15,000 or more. the bulk of it is artist like peter max and thomas kincaid, who is very popular in the u.s., and people who you may not have heard of who are part of this stable of artists of park west that they represent.
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they had mark chagall's, they had, you know, prints. these are numbered prints worth tens of thousands in some cases. the bulk of what i saw them selling was in the few thousand dollar range. some people you heard of, some people you have not. is this supposed to be a good investment? the interesting thing is that they said that they could not predict the future. again and again they said that. that was one of the things that people complained about a these lawsuits that happened, that clearly they had cleaned up. on the other hand, there was a question of, did people know what they were buying? this is where even i was unsure of at first what there was. walking around the gallery, they had kincaid's with splotches of paint on them. peter max where you can see the brush strokes on it. there was actually a mix. not necessarily one-off paintings but something mass-produced and touched up to be one-of-a-kind.
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carol: what is interesting is that maybe what you see on the cruise ship as a consumer or someone who ends up bidding on a piece of work, you don't necessarily get that work of art that you see on the ship? >> right. and this is what some of the passengers were confused about. i bid on that day up there, saw it, bought it, now they are telling me to pick out a frame and we will send you another version from our florida warehouse. it was there in the fine print. i could see it when i read the terms and conditions. but there was one guy in a new york yankees t-shirt that thought he bought a painting on canvas, but ended up buying something else, which was a type of inkjet printer. it was a reproduce. they do a series of hundreds of not thousands of the same pictures and call it part of a limited edition series. it was not always clear to the passengers. oliver: staying on travel, let's
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talk about travel gadgets. carol: correspondent sam tested for products that may help with your flying over the holiday season. sam: we could start with maybe the product i was most impressed by, which are the bose, quiet comfort headphones. bose have been making noise reducing headphones for some time. these are new and has some interesting new features. they are wireless and noise reducing. they are in-ear earbuds, which i think are preferable. oliver: how do you block out noise using a bud? sam: the bose headphones were quiet controlled and they use opposite phase soundwaves to cancel out background noise. that thrumming of an airplane, you know, it generates a certain frequency. these have a microphone that he hear that frequency and generate
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the opposite phase frequency, canceling it out. carol: i love my bose headphones. did you like them, did they work well? sam: i think they worked very well. areke that the earbuds smaller. carol: you have to tell me about the scooter luggage, which looks fun to see you on. sam: i cannot say it was necessarily fun to use. this company micro makes scooters and decided, hey, what if we attached a carry-on bag, a traditional, hard sided carry on bag to a scooter? the scooter portion can flip up into the back of the bag when not needed. the telescoping handle can come up and down like it would on a traditional rolling cart and you could ride this thing around the airport because as you know, sometimes the distance because -- distance from gate to exit can be almost one mile. i am talking about terminal one in london where you just keep going and you say, ok i am in
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london now. carol: they look small. sam: it is a small bag, it is a heavy bag. once you pick it up with all of that scooter equipment, it will weigh a bit. you do get some really funny looks from people in the airport. carol: you have to talk about the carry-on cocktail kit. that sounds kind of fun. then you will need the sleep mask afterwards, after you have had your cocktail. sam: a small company designed and created these little sardine can-sized kits with all of the mixers that you would need to create a proper cocktail on an airplane. the only thing you need to get from the cart is the liquor. but this is all tsa approved, very small amounts. if you want to make an old-fashioned or a moscow mule or a bloody mary, you just get the appropriate liquor, the vodka, the scotch from the flight attendant, and you open up this kit and it has everything you need. in the case of the bloody mary mix, it comes with tiny little pickles sealed in a plastic envelope. carol: did you sample it?
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sam: i surely did, are you kidding me? i'm a journalist. that is my job. carol: to me about the deep rest mask. sam: some people think about sleep masks, what could people think about sleep masks. why not just put a cloth around my head? the thing you want in a sleep mask is you want some padding around the perimeter of your eye. now we are getting very technical here, but it causes the rest of the eye mask to rest above your eyelids, not flat on them. and that has several effects. first of all, it means you can blink. blink. and of course, if you are wearing eye makeup and both of you might be doing that depending on the shoot, it does not mess anything like that up. this one completely blocks out all light. very inexpensive, very
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comfortable. you can wear it all flight long. carol: "bloomberg businessweek" is available on newsstands now. oliver: a lot of great stories. did you have a favorite? carol: i like the cover story on the bad shrimp. so much bad shrimp coming in from asia, china specifically. it takes down into the overuse of antibiotics getting into the seafood. we don't want to see that because it is creating a superbug that is creating more and more deaths every year, if you will. but the story digs down into the details and tracks the progress of shrimp coming in from china into the united states. noter: even when it is coming in through china they find a way to come in through back channels. very interesting. carol: how about you, favorite story? oliver: probably the american dream mall in new jersey because as new yorkers, some of us have driven past it and it is not going anywhere. it is called the american dream. it is just really at a standstill. and the family behind it, it was great investigative reporting, because they are very shrouded. more bloomberg television starts right now. ♪
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♪ vonnie: coming up on "bloomberg best", the stories that shaped the week in business around the world. the dot plot thickens and the fed hikes rates. >> i think the fed took a small step beyond being data dependent. vonnie: the oil outlook brightens the outlook for crude. italian banks set price targets. there is a change in the guard at goldman sachs. >> goldman sachs is making this move from a position of strength. vonnie: donald trump continues to construct his cabinet. his unconventional picks have sparked plenty of discussion. >> if you are going to be president, you should have the best people sitting around the table. >> being successful in business does not necessarily mean you will be successful in


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