Pivot - Covid’s ‘second wave’ and business, Europe brings antitrust suit to Amazon, and a prediction on fitness trackers

Episode Date: November 13, 2020

Kara and Scott talk about the spike in covid-19 cases and how that's affecting the stock market ånd business. They discuss antitrust charges against Amazon from Europe. In listener mail, Scott talks about whether college should be free. Kara has a prediction on fitness trackers. Learn more about your ad choices. Visit podcastchoices.com/adchoices

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hours of entertainment, delicious dining, and warm, welcoming service that's designed around you. Check out virginatlantic.com for your next trip to London and beyond and see for yourself how traveling for business can always be a pleasure. Hi, everyone. Get started at HubSpot.com slash marketers. Because there's a coup going on, in case you're interested, or an attempted coup by a bunch of imbeciles. Isn't it ironic that we have a coup by a draft dodger? I mean, it just doesn't get any stranger. They're scary and feckless at the same time. That's what it is. It's scary because they're installing all these people at DOD and whatever, but they're all idiots.

And so you're sort of like, interesting, but can they pull it off? But they can't do anything. So it seems like, no, they can they pull it off? But they can't do anything. So it seems like, no, they can't pull it off. No, it's sort of Rick Moranis' Darth Vader in Spaceballs. It's like, thank God. Thank God they're just so dangerously, thank God they're just so fucking stupid. I mean, what are they going to do? They're going to take this all the way to the Supreme Courtyard by Marriott? I mean, these people are just, these people are just. Did you say that joke of Supreme Court? That's been in the dog's pocket for a while. I just, you know, the scariest thing about Dick

Cheney was that he was very smart and he was good at fomenting relationships. He was. I was scared of him. He's, for good reason. The Achilles heel is between the ears of this administration. Yeah. The Achilles heel is between the ears of this administration. And that is they're just so dumb. It's like they don't even know how to be good strongmen. Yeah. It's just so kind of. They have made the implicit explicit, though.

This is a theme I'm thinking of, this idea of they do everything explicitly. It's sort of like in a James Bond movie. It's kind of, yeah, I kind of do because it's like, now we're going to put you in a buzzsaw and then we're going to take over this and then we're going to do this and of course,

James Bond gets out and stops the whole thing. That's what they do. Old finger, you expect me to talk? No, Mr. Bond, I expect you to die. I expect you to die.

You know, that movie keeps getting moved. It's making me so depressed. I really want to see the new James Bond movie. Yeah. I love James Bond so much. They were smart.

They switched, They put it on a streaming video platform. They keep switching it. They just moved the Wonder Woman movie to like 2040. And so I'm not happy about any of this. In any case, what is coming up on Netflix is saving my life right now, I have to say. By the way, The Queen's Gambit is getting bigger and bigger. See, aren't

you glad that I mentioned that you should watch it? You should still watch it. I did. I've watched the first two episodes. It's great, isn't it? I think it's wonderful. Yeah. It's just wonderful. I'm glad glad that I mentioned that you should watch it. You should still watch it. I did. I've watched the first two episodes. It's great, isn't it? I think it's wonderful. Yeah. It's just wonderful. Which is, I'm glad something good, but Netflix is the same. There's about to come out a movie on Netflix, a rom-com with Kristen Stewart being a lesbian,

going home with her girlfriend and the girlfriend's family. Oh, I'll definitely watch that. Yes, exactly. For me, you know what? I've been watching rom-coms with lesbians for a while. It's called Cinemax, Kara. It's called Cinemax. Don't even.

Anyway, this is adorable, and Kristen Stewart is adorable, and therefore I shall be sitting right there at Thanksgiving watching it and ignoring my children. Anyway, a couple more things we can banter about. Supreme got bought by Vans, a parent company. Can streetwear brand maintain its image when it goes corporate? Supreme has continued to say successful. It's interesting. My kids love Supreme

and then they thought it was not good and then they liked it again. It was interesting, you know, but they did like it for a long time. I think this is a fantastic acquisition and the purists, I come from the world of brand strategy where people love to think of themselves

as brand purists and there's all these blogs about how Supreme is done. First off, VF is outstanding at taking streetwear brands and maintaining the equity and then providing the scale. I mean, VF has pulled off some of the most successful acquisitions in history. They took North Face, which took 40 years to get to a billion, and they took it to two billion almost overnight by providing the platform distribution in China. And I think the North Face brand is stronger than it ever is. They took Vans, which had this— I'm a Patagonia girl, but go ahead. They took Vans for—isn't that what Kristen Stewart wears?

Yes. Together, you'll watch the movie wearing her Patagonia fleece. They took that. A lot of emotions running high in that image. Anyways, a lot of mixed emotions. So they took Vans, which is a wonderful brand, but had ups and downs and some good brand management. And they absolutely scaled that thing. My kid wants me to wear Vans.

And everyone said, well, they paid too much for it. $2 billion on a $500 million for 12 months. That's four times revenues. That is rich for an apparel company. But, you know, whether, probably one of the best acquirers of brands, Estee Lauder's right up there. They took, you know, they took MAC, this little, I think it was $50 or $100 million kind of cult brand. And everyone said, oh, it's over. They scaled it to a couple billion dollars.

VF is outstanding. They have outstanding management. What they did with Vans, what they did with North Face, what they could do with this brand and this platform. They have outstanding brand management, bigger scale. And not only that, not only that, the acquisition's already paid for. The stock has gone from, the market capitalization of VF has gone from $27 billion to $3 billion in the five days since they've announced it, even though it came back a little bit. Supreme's an interesting brand. I don't think it depends on street cred necessarily. It actually

makes them very attractive. It has a look. My kid has a lot of Supreme stuff, and it's quite expensive. But it's lovely stuff, I have to say. I mean, this is a parent talking, which means dead in the water, if that's the case. But I think you're right. They're going to do very well with this brand. Artisanship, artificial scarcity, very, very low ratio of physical footprint to digital, 70% done digital. And also, they've mastered this whole idea of these Monday drops where they create excitement and they pre-sell everything. Indeed.

And then they're going to – this is what acquisitions are supposed to be. You take something really unique and wonderful and artisanship, and then you help these guys scale with capital and distribution. So I'm actually a big fan of this. They had one of these stores, these pop-up stores in Los Angeles. We were at the Taylor, Tyler, the wrapper store nearby. It was all on this one street, Fairfax in Los Angeles. And the lines were around the block,

mostly from people from Asia, which was really interesting. Just around the block, just buying big giant bags of this stuff, which is interesting. So they'll probably expand it quite significantly all over the place. Another thing, since Trump's defeat in the election, QAnon has lost some steam, apparently.

Is the internet about to become a better place, or am I too optimistic? Everyone's moving—all the obnoxious people are moving to Parley or Parler or whatever the heck they call it, which I call a flash in the clan. But it looks like they're like, oh, wait, this wasn't true. The QAnon people are surprised that perhaps the things they've been touting were not true. Well, it's just a couple— it's a collision of two things. And the first is Facebook and Twitter have realized mom and dad are coming home early, and they're trying desperately to pretend that they're not awful people and clean themselves up and put on, you know,

they're attempting to starch a permanently black hat, sort of dark gray. Yeah. And they're doing what they a permanently black hat sort of dark gray. Yeah. And they're doing what they should have been doing for the last decade. But just to let you know, just as we remember Marco Rubio and Susan Collins, we're going to remember Facebook and Twitter, how you've actually behaved the last decade. Marco Rubio has doubled down on dumb. It's really amazing. Yeah. I don't – the Lincoln Project says that he's their next target.

Yeah, good. So, and by the way, he's already, he's literally already, he's not spending any time representing the great state of Florida. No. He's spending all his time raising money for a 2024 run. He's already calling donors. He's never going to become president. Let's just make that clear. He's convinced he is.

He is never. Tucker Carlson's going to ride all over them. Same thing with Pompeo, another oaf. Same thing with Cruz. Nobody likes you guys. Sorry, no one likes you. Even the people that would vote for you don't like you. They like Tucker Carlson.

They like the lady from South Dakota, Nome, and they like President Trump is who they like. Yeah, I think Nikki Haley is in there too. But the other second force, and we made a prediction around this. All the concern about Trump and autocracy and him holding on and not leaving the office, what people fail to realize is that when a good man with poor execution leaves office,

we give him a Nobel Peace Prize. We love Jimmy Carter. Right. And strong men usually end up hung upside down naked with bullet holes in them, or they're taken to a field like Ceausescu and executed with their wife. Okay. Strongmen do not have a good post-game play. He's going to be just fine.

No, I don't think so. See, and that's my prediction. I think his power over the party, his power over media, a mix of, there's this phenomenon. Yeah, people get tired of him. I think people are just, I think he is literally, it's going to be fade to mediocrity. The fall to mediocrity here and irrelevance is just going to be as violent and as strange as his rise. I don't think he's going to pose nearly the threat, the presence, the equity, the influence that all these Republican senators think he's going to have, who literally have their testicles have, they've all become, I don't know what the term is.

Indeed. Well, what's interesting, though, Facebook has, speaking of trying to starch their hat white, Facebook has extended its political ad ban for another month as the Georgia Senate runoff heats up. So they can't really

be using that. They certainly continue to use content to do that, but it'll be interesting. And again, Kevin Roos again has pointed out

how badly they have bollocks the content problem. And then Facebook whacked back at him this week saying it's not as bad as you think. It's bad, but not as bad as you think it is. So it was interesting. Anyway, we're going to get to big stories because one of the stories that's getting lost in all this is COVID-19. The cases are sadly back on the rise in the United States.

Let's talk about what this means for cities and businesses. I hate to bring this back, but it's not over, even though we had some good news around the vaccines, which they're good news, but they're not the end point yet. This week, a COVID case in the U.S. saw a 69% two-week surge.

New York's Mayor de Blasio said the city is on the cusp of a second lockdown and restaurants around the state will start to close by 10 p.m. European cities are already on their second round of lockdowns. Even Republican states are putting mask mandates, sort of anticipating Biden doing that. But a lot of Republican states, Utah and Ohio, are looking at that. Meanwhile, with the news of the Pfizer vaccine, we've seen the stocks of pandemic star companies like Zoom fall and travel companies'

stocks soar. But we're in the middle of it still. And most people think next October is the first time we will all, next September will be when everything will be back to, and there's no such thing as normal. So talk about the impact on businesses. So look, I always need to preface this with I'm a glass half empty kind of guy. I mean, 99% of academics, investors, media personalities will always say, well, I'm an optimist. It's impossible for 99% of people to be better drivers than the median. It's impossible for everyone to be an optimist. And I just think the data is just so ugly here. And the fact that we haven't experienced a winter with COVID, the fact that we had, we're setting new records every day. We now have record hospitalizations. And we have the tip of

the spear here, the people that are supposed to be, you know, the reason Taiwan, South Korea, and Germany have done so well around this and have managed to arrest the death, disease, and disability that's been levied on our nation is they have leadership and coordination. And it appears that our leadership has just decided that they don't care. They didn't care before. They're willing to infect each other. He's busy doing voter, fake voter fraud lawsuits when he should be talking about COVID. But of course, he doesn't care about the job. I also unfortunately believe that our superpower as a nation is our optimism is that,

I don't want to say, the vaccine from Pfizer is wonderful. It's a wonderful story. It's the couple, the Turkish-German immigrants. It's just, it's wonderful. But everything that has happened, every projection that has happened around COVID-19 has one thing in common.

It's been too optimistic. Everything's taken longer than we thought. So, you know, everybody, we were supposed to have a vaccine by now. And whatever projections you get around when we'll get this vaccine, when it'll be administered, when we actually get the herd immunity, when we can distribute a product that needs to be stored at negative 60 Celsius and requires two doses. Do you realize two-thirds of people don't come in for their follow-up? I think it's their HPV vaccination. I mean, so I'm really— Scott Walgreens called me and told you you need to get in for that, but go ahead.

There's so many wrong places I could go with that. Scott Herpes Galloway is who I like to call. There's so many wrong places I could go with that. Herp is my name for Scott, but go ahead. Thanks for that. No problem. But you have this incredible optimism, or we have a tendency or a bias towards optimism. Yeah.

And it's our comorbidity here, and we need to be, it saddens me that New York restaurants are open right now. There was a study that just came out, and I think this is a really important observation, that people aren't super spreaders. Events and places are. And the four really dangerous areas are full-serve restaurants, cafes, hotels, which shocked me, and also gyms. And all of those things need to be shut down. We need a national mask mandate. Again, the data I always point to around China that's managed to be the host or the epicenter for this, but has managed to come back, was they really seriously locked

down. And I don't understand this defeatism that we have embraced, that we don't have the will or the mentality or the resources to severely lock down. It's beyond defeatism. It's this herd mentality, you have to die sometime mentality. I told you, my brother said that to me. I was like, what? Like, you know, I mean, it's just really not my California brother, my other one. There is a mentality of like, oh, well, can't do anything about it. Look at Mark Meadows versus, you know, Ron Klain. Look at the, look at the very different. Ron Klain is someone I know actually very well.

He's going to be the chief of staff to Biden in the White House. He's also the Ebola czar. Um, and hopefully we'll get him on the show to chat with us. But, um, he, you know, look at the difference. Mark Meadows got, was at many super spreader events. He seems to have given a lot of people COVID, was egregiously obnoxious about not wearing masks, rude on top of it, not just not wearing masks,

but rude about it, and then gives it to people, gets it. And then you have someone like Ron Klain, who does not have it, who a lot, you know, you don't see like this sweeping through the Biden camp. And you could, by the way, but they're careful. They're more careful and care about science. And here's this guy coming in who walked Ruth Bader Ginsburg through her Senate hearings. He was a clerk at the Supreme Court.

He was the Ebola czar. The qualifications to be able to handle something like this, I cannot wait until someone like that gets in place, qualifications to be able to handle something like this. I cannot wait till someone like that gets in place rather than this fatuous chucklehead who just has nothing. He has no abilities in any of the things it requires, especially around COVID. So talk about whether the restaurant industry can sustain another lockdown and also what should these at-home companies do to maintain their momentum as the vaccine is on the horizon but still not here? Beyonce just teamed up with Peloton this week, which is great. I already did one.

What stocks would you buy now in this landscape? So, I think it's fairly obvious. There was a pandemic trade, right? The Peloton, the Zoom, and Amazon, and several others. Restoration Hardware, Williams-Sonoma, HomeStops. And they checked back. They all had some of their worst days when the vaccine or the excitement about the vaccine came out. And then the beach stocks, the hotels, the cruises, the airlines all skyrocketed. You want to take the other side

of that trade now. And I'm stealing my thunder. This was going to be my prediction. But think about what's going on here. We're about to go into a winter. This will be the worst winter we've had since 1943 in terms of mood in America. We're about to constantly get news about how we are losing this war. We have a fighting force that is led by incompetent generals that is misallocating revenues, that is building tanks to go to fight itself as opposed to fight the enemy. It's just so fucked up. And we're about to have the worst winter, I think, in a long time. And the perfect storm, the perfect storm, though, of good things is about to happen for Amazon. Look at the macro data. The savings rate is greater than it's ever

been because people aren't going out and spending money. They're not going to restaurants. They're not traveling. They're not buying anything but essentials. So, okay, the essential guys, boom, Target, Walmart, and Amazon, boom. So, what do we have? We have an entire population of people who aren't going to travel over Christmas. They have more money in their pockets. They've been buying essentials, but now they're going to move to discretionary because they're going to be home and they're going to be depressed. So, they're going to buy a new rug. They're going to buy a new PlayStation 5 for their kids. They're going to spend more on Christmas gifts than they spent in a long time because they have a lot of- But not locally. But not locally.

Not locally, not in stores, on Amazon. No, I get that. I get that. What was interesting, I get that. But the issue is, when will they start to return to local? What was interesting, I just did a podcast with Raj Chetty on your suggestion, actually. He was amazing. And one of his statistics that was so interesting is that money spent in poorer areas is higher. The decline for local retail is lower because people have to go out and they have to buy at stores and can't avail themselves to the Amazon solution. wealthier areas of San Francisco, whatever city it happens to be, has gone down precipitously. And that they're not going to be hiring these people back because people are availing themselves to the Amazons of the world. Well, the people that can't stay home can or do, and they have nicer homes to stay at home. But look, it's as if Amazon was invented for a pandemic. It's business

lines or e-commerce. Oh, and by the way, they've made a massive investment in a vaccinated supply chain. Additional PPE, additional compensation, additional protocols. So the one supply chain that will likely be bulletproof through what will be the greatest e-commerce holiday in history is going to be Amazon. It's going to be the most bulletproof. And all those vans, which are like tanks lining up in the border, all those green vans we've been seeing with that smiley face on it, you know, all of the traffic they have to the site, the fact that they aren't just essentials. They have now all the discretionary stuff you want. But what do they also have? They have AWS. AWS is Latin for remote work. The AWS is going to have its best quarter ever. And,

oh, wait, what about streaming video? Oh, then they now have the number two or the number three player. It's as if this thing was invented. And it skyrocketed the first half of the year around 40 or 50 percent, but it's actually been flat since August. So, that's your buy. What else? This is the perfect storm of good things for the pandemic trade, which unfortunately is going to get new wind in its sails because this is just going to be such an ugly Christmas.

They will have the ability to make choices to keep going because it's not going to be just one pandemic, by the way. These novel viruses are here to stay. And so you're going to have companies sort of lining up to decide, you know, you're not working for us unless you get the vaccine. You're not doing this. Like, they can start to begin to act like governments should be acting. You know, say, you don't have to work here, but if you do, you have to get the vaccine,

things like that. And so, that should be interesting. What other stocks? What other stocks? Well, and who will offer that? I think I'm getting, me and my family are getting tested every week now. Yeah. And we have someone come to our house.

It's expensive and it's complicated. I think Amazon will start offering as a feature of Prime testing. I know. I was just saying, I'm trying to get Amanda tested because she's trying to go home to see her family. I mean, someone, a nice, well-trained person in a uniform shows up to my house five times a week called an Amazon delivery person. Why wouldn't they just take a swab and put it in my nose? Yeah. And then send me an email.

Or better yet, just when I turn on my Amazon show, it says your test results are in. It just blinks and you just say, okay, Alexa, tell me what my test results were. Yeah. The diagnostics, the healthcare that Amazon is in a position because of their hardware, their distribution is just striking. Okay, so you asked for their stock. Can I tell you someone in Silicon Valley's solution? What's that?

They bought their own testing. You might want to think it's only $5,000 only. Well, that'll happen. That'll be the next big innovation in hardware. They bought their own, and then someone you know, and they want to play, not Jason Koke, but he likes to play poker, wants to play poker with friends, and so bought the best test he could buy. And they test them before they come over, or they test them outside in their giant mansion courtyard. And then they wait, and then they can come in and play poker. I don't know who that person is, but I think there's a non-zero probability the first or second guillotine gets built in front of their house.

You'll hear it on Sway. It's someone who's going to be on Sway. Anyways, good for them. I think you're going to see hardware innovation here. You're going to see just as—we never used to—we never had the hardware. The hardware used to be we had these stupid glass pots called coffee pots, and then it went to the store, and then it went back to Nespresso and really cool hardware. Testing's about to be hardware in service.

Same thing with pregnancy tests. Like, you should be able to get them like that. Like, this is a real opportunity from a business point of view. And they became more and more accurate, that's all, over time. I think one of the issues of these rapid tests is the accuracy issues around them versus the other kind that take a few days. But eventually, we'll have testing in your home.

You'll have a device where you get tested all the time. So you asked for other stocks. Williams-Sonoma and Restoration will both hit all-time highs. As everybody decides, you know what? I'm gonna get myself or my wife that new couch or new, we're gonna invest in our home. You're likely gonna see Peloton rocket, just rocket.

They've extended their lead. I have seen four Peloton deliveries in my neighborhood. How many people are gonna give Peloton just rock it. They've extended their lead. I have seen four Peloton deliveries in my neighborhood. How many people are going to give Peloton as a gift? And by the way, these people spent, they're not very rich people. They just used to spend it at Orange Theory or SoulCycle or their gym or Equinox. And they're just moving that over. The sweat industrial complex is just being absolutely fundamentally recapped. Four Pelotons in the past week. It was really interesting.

And you're going to see, unfortunately, you're going to see another leg down in the beach stocks who got very excited and it's premature because it's going to be a long, dark winter.

So all the pandemic stocks that checked back for a week, quite frankly, it's a buying opportunity. But the mother of all, the mother of all pandemic stocks, a company that literally looks as if it was architected for a pandemic is Amazon.

And if I were advising people and I disclose what I'm doing, I think Amazon on a risk-adjusted basis is just so bulletproof right now. It's going to have the mother of all quarters. We're never going to see – I don't think we're ever going to see a company report the kind of metrics Amazon is going to report in this quarter. I would agree. Anyway, we're going to take a quick break. When we come back, we're going to talk about Europe's antitrust suit against Amazon, speaking of that, and a listener mail question. Fox Creative. This is advertiser content from Zelle.

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the one that Scott was just touting as a stock. This week, the European Commission Vice President Marguerite Vestager back again said Amazon was unfairly using data to box out smaller competitors, which is an issue in this country too. The case has been expected for months and closely trails the United States' own antitrust lawsuit against Google. Apple and Facebook are also facing investigations, both in Washington and Brussels, along with Amazon. President-elect Joe Biden is expected to keep the mounting pressure on Silicon Valley during his time in office.

It depends on who he picks for the number two, the antitrust slot at the Justice Department, but there's a lot of names being bandied about. And they're pretty aggressive, not as aggressive as people like Elizabeth Warren and Alexandria Ocasio-Cortez and David Cicilline want, but aggressive enough, more aggressive, although, again, the Trump administration has been relatively aggressive in antitrust comparatively, too. So why did Europe target Amazon before the other tech companies? I thought that was brilliant on Marguerite's part. And what's the strategy? And how will this transatlantic effort affect the companies both in Europe and the U.S.? You know, it's a good question.

I don't know why. The only thing I can think of around why going after Amazon first, because I think the case is actually stronger against Google, is that when you go after Amazon, a weakened Amazon or a less dominant Amazon, European retail is still a very large, robust business. It is indeed. Local, too. Yeah. And so that helps the local guys out more. Whereas if you heard Google,

it kind of helps Facebook. So I wonder if they think, okay, the whole point of antitrust is oxygenate the economy with greater competition. It feels to me that that oxygen flows to other European retailers as opposed to another American tech company. So the people really pushing or shoving Vestia are like Yelp and Expedia, you know, who are angry at Google. And so if she goes after Google, she's helping, you know, other American companies, where I think if she goes after Amazon, she's helping European retailers. What do you think? That's the only thing I can come up with. I think she's smart. I think she can stop it before kind of thing. Google's sort of invaded in ways that they haven't been able to push back. And Amazon doesn't quite have the

same power in Europe. And people like their local retailers. There's a much, you know, just the way they have more attention to privacy as As citizens, they really, it is a big deal among citizens and has a lot of support. The idea of local retail is a big deal in Europe comparatively. That's right. We'll just throw our local retailers over the side if we need to and accept our Amazon boxes. Europe, that's not the case. It will be eventually. They eventually got McDonald's.

They eventually get all our horrible behaviors. But it's really the right place to go. And also, it's easy to, you know, she has to demonize them a little bit. That's what she's good at. And then there's a very clear between the marketplace and the things they sell is just such a clear. And Amazon's already, there's a lot of emails about this. It's a good case for them. I think it makes sense. It doesn't mean they're not going to stop with the others, but I really think in terms of getting results, I suspect that she sees more yielding of more fruit

for her. And we'll see where it goes here. People have not targeted Amazon here quite as much, although there are investigations, because people love Amazon, right? That's one of the goes here. People have not targeted Amazon here quite as much, although there are investigations, because people love Amazon, right? That's one of the issues here. People love and depend on it in the middle of a pandemic. It's harder. There in Europe, they don't depend on it in the same way yet. Yet.

So I think it'll be interesting. It'll be interesting to see who Biden picks for all these different... Yeah, Jess, just back on Amazon in Europe, 80% of German consumers have bought something from Amazon in the last 12 months, and 800,000 retailers, mom and pop and larger retailers, sit on the Amazon platform, and there's Amazon gathering all that data, deciding which and how

categories they're going to go into directly and compete. And that's the primary issue here, you can both own the rails and get access to all that data and then compete at the end station. And essentially, it reminds me of, I don't know, in my opinion, the best TV series of all time, Breaking Bad. The cook, Jesse and Walter's only survival, they were literally playing for time, was they wanted them to teach other people how to cook meth. And once someone else got 80% as good, they were going to be dead. And that's how every retailer feels on Amazon. It's like, well, as long as I can make better crystal, much better, I'm fine. But there's Amazon watching me with their head over my shoulder, taking notes.

Right. And trying every day to find new ways to cook themselves. And once they can cook the meth at 80% of the quality, they're going to put a bullet in my head. That was a real reach in terms of a metaphor. But I think it works. I think it works. I think she's picking the right. She's a savvy woman.

Yeah, she is. And I think she knows. She's very good. It's not that the barn door is closed with Google, but they definitely will have a – they've been fighting for years, let's just say. I think that she is going for – there is a great love of local retail in Europe. I love Marguerite Bastier. She should star in a rom-com with Kristen Stewart. Boom!

On Netflix now. I don't know. The new rom-com. She was a former Danish economic minister. No, she's a straight lady. She just sort of looks a little bit that way, but she's not. She's a big family. I don't see looks, Kara.

I don't reduce women's looks down to their sexual orientation. I'm triggered. I'm triggered. Do you remember that website from a long time? It may still exist. It was called Dyke or German Lady. And then it was Euro. Dyke or German Lady.

Was there a yes button? I was always wrong. I have absolutely no comment. I have absolutely no comment. I was like, damn, German Lady. She's German. It was funny. I was just showing Amanda.

Remember shoes? Shoes. Oh, my God. Shoes. it was funny I was just showing Amanda remember shoes shoes oh my god shoes let's get some shoes shoes shoes that video

I'm looking at a lot of old viral videos these days and one of them was shoes I don't know any of those you know what we didn't talk about

as I try to elegantly segue out of German lady or lesbian is apple and its chips yeah I think that's a big deal. Yeah. All right. Yes, we do. Yes. Maybe we'll talk about it on Monday. We will talk about that.

That is a big deal. We don't have a third topic. But listen, we have a listener mail. We're going to do that instead. Let's go to the listener mail question. You've got, you've got, I can't believe I'm going to be a mailman. You've got mail. Hi, Kara and Scott. This is Michael from Melbourne, Australia. Scott, President-elect Biden has flagged free college tuition, which has triggered heated reactions on social media. And I was wondering what your view would be of this on the university sector. Love the show. Thanks for taking my question. That's a good one. I'm going to leave that for you, Scott, because this is, you know, I don't think he said he's flagged it, but I think that's more of a Bernie Sanders kind of thing.

Yeah, well, and Elizabeth Warren. Elizabeth Warren, absolutely. It makes the far left look bad, and it's another reflex memory of tired, really far left ideas that make absolutely no sense. Free college is nothing but a transfer of wealth from the poor to the rich, which we've been doing a really good job of for the last 30 years because the majority of students in college are either from upper-middle income or wealthy households. The top 1% are 77 kids in the top 1% of income earning households are 77 times more likely to go to an elite college. It's not about providing free college. It's about making college more attainable to those who can't afford it. So, we should take all that income they're

planning to push to rich people who populate college campuses right now, and we should use it for targeted financial support, and we should use it to expand big tech schools, embrace the big tech so they can dramatically expand enrollment at universities, such that a place like UCLA can go from an admittance rate of 12%, whereas now to 60%, so they can continue to let in the unremarkable children of single mothers who live and die a secretary, and then they can go on to make a shit ton of money hosting podcasts with German or lesbian co-hosts. The opportunity, the opportunity is not free education. The opportunity is more education affordable for everybody. But by all means, rich people, continue to charge them 58,000 bucks to send them to NYU. We don't have the money for it right now.

Also, that said, Dr. Jill Biden is an education expert. She may weigh in on some of this, do you think? Yeah. And by the way, I didn't, I didn't, it was a thoughtful question. That man sounded really nice. So I don't, a really good question. Another really stupid thing, forgiving everyone's student loans. Oh yeah, that's what they're talking about. You know what, we're a capitalist society. And my dad, my dad said this to me when he moved here. He's like, America is a terrible place to be stupid. I think we put for-profit schools out of business. I think it is morally corrupt what we've done. But there's a lot of people who make stupid mistakes and they paid off their student loans.

What do you say to them? What do you say to them the day after they pay it all off? And then you come in and forgive everyone's student loans? You expand social service. You expand national service. And you come up with a lot of ways to serve your country and get really aggressive loan forgiveness. But you just don't show up and start bailing people out of their stupid positions or their stupid decisions. It was a stupid decision for a lot of people to take on the student debt they did.

I don't know if it's stupid. I think people have asked for options. Well, we're preying on their hopes and dreams. I agree. We got to hit it from both ends. Secondly, there has to be creative ways to do this. You're right. There has to be.

And the second thing is, like, it just needs to be cheaper. It just needs to be more broad, more different ways to go that doesn't cost an arm and a leg. I had student debt. Well, you didn't. You were rich. I had student debt. But my student debt after undergrad and grad was a total of $17,000. And I could afford to pay that back because my total tuition, my total tuition for undergrad and grad at UCLA and Berkeley, get this, total tuition was $7,000.

Amazing. So, we need to move back. I tried to get my kid to go to public university. To UC? No, well, when we were in California, but no, it doesn't matter. You wasn't going for it? Anyways. He's paying your salary, Scott.

Anyways. That's what I'm doing right now. Yeah, by the way, I return all my salary. But anyways. Oh, my salary. But anyways, there's a huge opportunity here, and that is to take some of this money and dramatically expand public land-grant universities where two-thirds of America's youth are educated. And to upgrade technology, if you just take 50% of classes online, you effectively double supply. We need some class traders to get rid of the most unproductive, immoral union in the world, tenure. And we need to take these great universities, University of Texas, Cal State, Michigan, University of Florida, back to where they were such that good kids, not just freakishly remarkable kids, have a shot at an outstanding education at a good price.

It doesn't need to be free. There's no reason. I worked my ass off to get through UCLA, but I could do it. And there's nothing wrong with that. That teaches you character. That teaches you sacrifice. It's not your birthright to go to college. So, there's a shade of gray here that nobody on the left or nobody on the right wants to talk about. They either want to say free college or, you know, it's like, well, okay, let's be more thoughtful. Defund the police. Well, no, we really don't want to defund the police. That's a smaller group of people. Most people want police reform, and that's legitimate and reasonable.

Agreed. Okay, sorry. I got on my rant there. Most people do that one. That's just an ad. Like, you know, it's just an ad. It's just an ad. It's a call sign.

There are lots of people who think that, but the vast majority of people sit right in the middle, which is reform. Free college. Why don't you just give more money to rich people? They want cheaper college. That's right. We want reasonable college. And even more important than the middle, which is reform. Free college. Why don't you just give more money to rich people? They want cheaper college. They want college that's more affordable. We want reasonable college. And even more important than the costs, you know what the non-economic costs of the current caste system called higher ed is? Spring used to be a nervous

but joyous time to find out where you're going to school. Now it's the season of despair where you've got to sit down and your little girl who's played by the rules, done a great job, and you can't afford to send her to school. Yeah. And we need to dramatically expand enrollment such that people that get downshifted to a near Ivy-like experience with Ivy-like prices, basically all over America, the real moral corruption here is through a cartel system and this total drunk on exclusivity bullshit complexion of academics. That was ridiculous. We're charging people Mercedes for Hyundais. Yeah. We're charging people $58,000 a year

to go to shitty universities. 100%. And this notion that if you failed as a parent, if you don't send your kid to college, so okay, they didn't get into a good school, so I'll send them to a mediocre one and pay a quarter of a million dollars, which I have to mortgage my house. I do think one of the messages we have to give to people, I don't think college helped me one bit in my current job or anything else. I don't think college helped me one bit in my current job or anything else. I don't think it helped me one bit. Well, it gave you a credential. Would you have gotten jobs?

No, no, no. It didn't help me get jobs. It was the work. It was always the work. Never. Maybe if I was a lawyer. You don't think those first two or three jobs you had, you needed that credential? At the time, college I went to, Georgetown, was not considered that.

But you went to Journalism School of Columbia, right? Yeah, but it didn't get me any jobs. Yeah, but the education and the networking probably helped a lot. It didn't. I wish I had took that money and put it into Apple. That's what I wish. Right. That's interesting. A hundred percent didn't help me one bit. Well, one of the benefits, one of the silver linings here— Lots of other things helped me.

One of the silver linings of this pandemic is the fact that we do need to bust out of this notion that the only on-ramp to success is a college, a traditional college degree. And more importantly, we need to convince the greatest wealth creators in the history of mankind, the U.S. corporation, to stop forcing everyone to have a degree from an elite university, that there are other ways, other means of adding value in a company. So, look, I used to be, I always tell parents, a great plan B is to send your kids to school if you can afford it. But we need to fall back in love with the unremarkables, let more kids into college at a reasonable price

and also find other things, vocational schools, junior colleges, different types of certification and different on-ramps for people who don't necessarily want to go to college. A hundred percent. It's a very high paying jobs. They can be very high paying jobs and necessary. And they don't immediately want to go to college. A hundred percent. They're very high-paying jobs. They can be very high-paying jobs. And necessary.

And they don't immediately get digitized, the plumbing, electrical work. By the way, Sundar Pichai totally played to my emotional needs and launched this $300 Google certification program for UIUX and product management. Is that actually happening? I don't know. I'll check. I'll call them. I'll call them and find out. Were they toying with my emotions? Were they flirting with me? Yeah, they think about you't know. I'll check. I'll call him. I'll call him and find out. Were they toying with my emotions?

Were they flirting with me? Yeah, they think about you every day, Scott. I think so. That's all they do. Listen, we're going to take one more quick break. Oh, yeah. I'm on their mind. See, they forgot.

They don't want to let Scott down. They hung up. Yeah. All right, Scott, one more quick break. We'll be back for predictions. The Capital Ideas Podcast now features a series hosted by Capital Group CEO, Mike Gitlin. Through the words and experiences of investment professionals, you'll discover what differentiates their investment approach, what learnings have shifted their career trajectories, and how do they find their next great idea?

Invest 30 minutes in an episode today. Subscribe wherever you get your podcasts. Published by Capital Client Group, Inc. Support for this show comes from Constant Contact. You know what's not easy? Marketing. And when you're starting your small business, while you're so focused on the day-to-day, the personnel, and the finances, marketing is the last thing on your mind.

But if customers don't know about you, the rest of it doesn't really matter. Luckily, there's Constant Contact. Constant Contact's award-winning marketing platform can help your businesses stand out, stay top of mind, and see big results. Sell more, raise more, and build more genuine relationships with your audience through a suite of digital marketing tools made to fast track your growth. With Constant Contact, you can get email marketing that helps you create and send the perfect email to every customer, and create, promote, and manage your events with ease all in one place. Get all the automation, integration, and reporting tools that get

your marketing running seamlessly. All backed by Constant Contact's expert live customer support. Ready, set, grow. Go to constantcontact.ca and start your free trial today. Go to ConstantContact.ca for your free trial. ConstantContact.ca. Okay, Scott, I have a prediction, but you go first. You go first. I want to hear yours. I would suck all the oxygen out of the room. No. All right. This is what I think. I just did an antitrust panel for the American Bar Association, a lot of big thankers. And they didn't welcome my opinions about Google and everything else, just FYI. This was a lot of people who get paid to let mergers sail through or help mergers sail through.

I think there's 600-plus tech mergers that have gone through without any kind of stoppage. And anyway, I was talking to a whole bunch of people there. And one of the things that I got the sense of is that they're going to let the Google Fitbit merger go through with Halo and the other things. They're going to let that one go through. So, under the auspices of the best way to predict the future is to make it, I think you know something. I think I might. Right. So, Fitbit's going to go through. I think you know something. I think I might. Right. So Fitbit's going to go through. I think it's going to go through. Yeah. That's interesting. I don't know. Tell me why it's interesting. Well, I don't know enough about antitrust to think, okay, is this monopoly abuse? But just as Apple is going vertical with search engines and with chips, Google, what's interesting about Google is they're the only big,

really, they haven't gone vertical into content in terms of streaming video. And they also, they've tried with the Pixel, but they really haven't done much in terms of, or had much success in terms of hardware. I guess Nest, what would you say is their hardware? Nest, yeah. Yeah. So, Fitbit, it wasn't a big acquisition. Wearables, everyone else is getting into wearables. Yeah, you got Amazon. I'm wearing an Amazon Halo. You're wearing a Halo. Obviously, the Apple Watch, not the iWatch, the Apple Watch. So I guess they could say, look, our competition's all in this space. Yeah. Yeah. That's interesting. What did they buy it for? They bought it for scrap, right? $400 or $500 million? Yeah. And actually, it's the best

one on the market, really. Although I have to tell you, I really like this Amazon Halo, except for it's listening to me right now and you and me right now. I'm going to turn that off in a minute. But I have to say it's the best one. You can see it right here. It's the best one so far. It's still a little thick, but I have to tell, compared to all the others,

it's the one I don't notice. Fitbit is also quite good. Still also thick, but quite a good one. But the amount of information they're getting is really disturbing, I have to say. The tone of voice thing. You know, if I pull up my thing right now, let's see what it does. It keeps saying, you are a German lady. And.

And. Good stuff. Okay. So today. Good stuff. So today. Yeah. Oh, look at this this i'm happy today's 12 happy seven oh five percent it breaks down your happiness oh yeah no it's the tone it's my tone so let's see i was irritated 10 seconds ago i was irritated 10 seconds ago that That makes sense. Friendly, 2.5 seconds ago. Aggressive, 2.8 seconds ago. So during our thing, I'm happy.

Yeah. I'm aggressive. Yeah. I'm friendly. And I'm irritated. Wow. That is. You just described 80% of my sex.

Anyways. Exactly. Discouraged. Oh, I was also discouraged. There you go. Unconfident. That was earlier today. You're walking you go. Unconfident. That was earlier today. You're walking away with an experience with me. That was earlier today.

But right now, I am – what time is it right now? Come here, over here. I'm happy now. Look at this. You make me – Good for you. I'm irritated. No, I'm mostly irritated. Happy and irritated. Lesbian or German. I'm irritated, stubborn, and dismissive. It's really kind of crazy. Anyway, you can also –

What does all that mean? Okay, my prediction. They also have a body fat thing, too. Really? You can take a picture. You take a picture yourself and load it up to Jeff Bezos. Oh, yeah? Yeah. Bezos doesn't have body fat.

You have to be pretty naked to do that. Yeah. I'm comfortable with my nudity. I'm more comfortable with my nudity. It's other people who aren't comfortable with my nudity. Anyway, prediction. I already said this. So Amazon's up 20% in the next seven weeks till its next earnings call.

It maybe hits 4,000. The pandemic trade only gets stronger. And unfortunately, it's going to be really, there's terrible things that are going to drive this, but you have this perfect storm, incredible savings rate, nowhere to spend it, a Christmas that always involves discretionary spending. Money in the bank for a lot of wealthy people.

Money in the bank, and then a supply chain that can handle flawlessly. The majority of e-commerce sites are going to be overwhelmed, and they're going to start sending out emails saying, we're not sure you can get there in time for Christmas. And there's going to be one place that says, we start sending out emails saying, we're not sure you can get there in time for Christmas. And there's going to be one place that says, we'll get it there early, COVID-free, and at a good price. Boom.

I mean, it's just going to be staggering the business Amazon is going to do in the next six weeks. Okay. Well, there you have it. That's a really good one. We have two good ones. We have two good ones.

We will talk about apple chips later because it's an important story. We'll talk about that Monday. What are you going to plan for the weekend, Kara? Organization of my house and stuff like that. Getting ready. My son's coming home for a couple of weeks.

He's going to- From NYU? From NYU. Yeah, he's going to stay for December because he wants to see his friends. And all his classes are online. They're going to hopefully go back online in January. He doesn't go back until mid-January. So hopefully things will ease off a little bit. But New York's been pretty good, honestly. He's had a good time there and

he's making friends and he doesn't have COVID and they have very low rates. So you were wrong about that one, unfortunately. You know what? I was 100% wrong. And to be fair, NYU's testing, and this is all public, it's been very robust and their positivity rates have been like 0.01%. They've done a fantastic job%. They're like Taiwan. They're behaving like Taiwan. I have to say, I thought they would because I watched as they rolled it out, and I was pretty pleased with how they're doing it. And again, you know, I think Louis is being social, but they're being very careful. And they're doing a lot of testing, and they're following up very quickly.

And so I feel pretty good. And so one of his classes, they're all going remote now because of this rise in New York. And so he's just going to stay home with his mama. That'll be nice. Yeah. Yeah. So I'll be around. I'm not doing much of anything.

All right, Scott. That's the show. Thank you so much. It's a very enjoyable show. Email us with- You're 2% gratified. Let me see. Let me look.

What does Jeff Bezos tell me I am? Irritated and gratified. Email us with questions about companies and trends in tech and business at pivot at voxmedia.com. We love your questions. Whatever you want to ask. Thank you so much from Australia. We really appreciate it. Michael from Melbourne, which is a beautiful city, by the way.

One of my favorites in that continent. The nicest city in Australia. Underrated. It's a wonderful city. Wonderful. They have that market there. I love everything about Melbourne. Underrated. It's a wonderful city. Wonderful. They have that market there. I love everything about Melbourne. My nephew lived there,

so I went and visited him once. All right. Read us out, Scott. Today's show was produced by Rebecca Sinanis. Fernando Finite engineered this episode. Erica Anderson is Pivot's executive producer.

Thanks also to Hannah Rosen and Drew Burrows. Make sure you subscribe to the show on Apple Podcasts, or if you're an Android user, check us out on Spotify or wherever you listen to podcasts. If you like the show, please recommend it to a friend. Thanks for listening to Pivot from New York Magazine and Vox Media.

We'll be back next week for a breakdown of all things German lady or lesbian. Cara, have a great weekend. Do you feel like your leads never lead anywhere and you're making content that no one sees and it takes forever to build a campaign? Well, that's why we built HubSpot. It's an AI-powered customer platform that builds campaigns for you,

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