♪ carol: welcome to bloomberg businessweek. jason: we are joining you from bloomberg headquarters in new york. carol: this week's issue is the pay gap, and wait until you are about the gender gap that comes to stock options. jason: president macron once likened him to the god jupiter, but lately, his powers have started to falter. carol: first, we start with another jampacked week in washington.

politicsit all for us, editor matthew philips, who talks about how the nomination process and trade policy are impacting the top agenda and midterm election. >> the question over whether this acquisition tanks his nomination is a big one. and with the midterms coming so quickly, it is not clear they will have the time, if that does not work out, to have another process. on trade, the political ramifications of this are quite real. the chinese are quite calibrated in how they are going after certain issuance with their retaliatory tariffs, looking at agriculture, the other sections of the country. going after seeming to calibrate their response to trump voters in farm country.

jason: matthew, when we think about the implications of this for the midterms, it feels like regardless of how the kavanaugh situation turns out, this will be an issue that both sides sink their teeth into to galvanize their respective electorate. >> this is an issue that has played well for the democrats. it has fired up women voters. there are lots of estimates out there about how big this blue wave is going to be, not just taking back the house, which seems more likely than not, but whether the senate is in play too. jason: it is also not hard to imagine that the president could use this to his advantage. two underscore the friction, to say the least, that he has with the democrats on the hill.

>> yeah. his comments about this have been "look, i feel very badly about cap, he is a great man." -- about judge kavanaugh, he is a great man." he has also gone out of his way to criticize democrats, asking why are we hearing about this now. it is unclear of the timing, when her office was made aware of these accusations. but clearly, he is trying to make political hay. saying that this is a last-ditch effort, that they are pulling out all the stops and it is nasty politics. carol: speaking about politics, there are a lot of politics within the white house itself. not everybody agreed's -- on the trade issue, not everybody agrees about how we should be determining new policy. steve mnuchin has one of you, -- one view, robert lise hauser has another view. you really want that white house to be together. >> in the first year of the

white house, there really was this internal battle raging between your globalists, so to speak, your mnuchin's and gary cohn, who resigned after the tariffs were announced. he left just five days after. and on the other side, you have a wilbur ross, peter navarro, they have won the fight, it seems. they have got the ball. they are moving quite quickly on nafta, or at least trying to. tariffs are the tools they have decided is going to be the most effective in trying to bring about your reshaping of the trade deals. carol: washington is coming on on a big week on fed rates.

this week's cover story is an in-depth look at jay powell's first months in office, a story that leads the politics section. jason: the fed chair is not supposed to be in the politics section, but we can think donald trump put him there. -- for putting them there. his tweets test the principle of central bank independence. carol: it does. one of our veteran fed watchers joins us now. >> unlike janet yellen, he has made a concerted effort to go on capitol hill and pound the caucus, as he puts it. he has visited about -- in the first six months, he has visited or spoken to about 45 lawmakers, roughly. that is three times the amount that his predecessor did over the same timeframe. behind this, of course, is our tweeter in chief president trump, who has broken with

decades long precedent and take an open, public pot shots at the fed. carol: next week, we have another meeting. the markets are pricing in another rate increase. president trump has been very outspoken about not wanting higher rates. this is a test of his ability, not just as a banker, but a politician, how he manages that. he has stayed out of the spotlight by not reacting to what trump has to say. >> this will be the first inter-rate increase since the president went public with his displeasure. and this will be the first time when powell will be pressed to respond. so how he responds, how he does

that, does he dismiss it? does he say the president can do -- can say what he wants, but we will do what congress has told us. it will be interesting how he does the delicate dance so that he does not become a punching bag for trump. carol: you talked about what he has been doing, i love how your story starts, taking us back to trump gaveresident an interview, was critical of the fed. at the same time, how is up on capitol hill talking to lobby and how the fed is doing. you talked to him about being a politician with a little p. i love that. this is a guy who understands government, he is not an economist, he does not have the training like other central bankers. he is not a politician, but he understands how washington works. >> he has been around washington a while.

he grew up he or. -- grew up here. he knows his way around, he is comfortable in pressing the flesh. his two predecessors, in contrast, they were phd economists. they always seemed more comfortable in seminars or conferences than they did on capitol hill. but he does have these political instincts. it seems suited for this task, which is a very important one, protect our independence, our ability to carry out our policy without somebody sticking their nose in it. jason: still ahead, jeff bezos explained why he hates to take meeting before 10 a.m.. carol: and when it comes to venture capital money, salary, women are missing out, and we have one more thing to add to that list, equity options. jason: this is bloomberg. ♪

♪ carol: welcome back. jason: you can also find us online. carol: and on our mobile app. one of the stories we continue to follow has to do with amazon, always watching to see what new business it is getting into. let's take a look at the revenues. let's bring in taylor riggs with an interesting chart. taylor: i like the top line, because it shows a clear picture of what they are doing. going down, things can look muddled. we are looking really basic here at top line revenue growth. , normally, a company of the incompany decides to pull $200 billion of revenue, you'd expect a minute or high single-digit growth, but this company continues to blow it out of the water. another reason why even at $1 trillion in market cap,

analysts are still pretty bullish. jason: i kept looking at that chart and thinking "am i reading that right?" i even understand that one. and that brings us to a highlight, an interview with one of the most successful and wealthiest onto dinners in the world, thanks to our sometime colleague david rubenstein. carol: we have a rare conversation with jeff business -- jeff bezos at the economic club in washington. a must watch in a week filled with stories about amazon. filled with speculation about a new alexa devices, cars, and more. jason: there is always a lots to talk about when it comes to building a trillion dollar company and leadership. so here is a clip from the david rubenstein show. david starts by asking jeff about some legendary quirks. >> i get up early, i like to putter in the morning, have

breakfast with my kids before school. my puttering time is important for me. except for my first meeting at 10:00, i like to do my high iq meetings before lunch. anything that is mentally challenging, that is a 10:00 meeting. because by 5:00, it's like, i can't think about this today. on sleep, i get eight hours of sleep, unless i am traveling in different time zones, sometimes it is impossible. but i am very focused on it. for me, i need eight hours of sleep. i think better, have more energy, my mood is better. as a senior executive, what do you really get paid to do? as a senior executive, you get paid to make a small number of high quality decisions.

your job is not to make thousands of decisions everyday. is that really worth it if the quality of those decisions might be lower because you are tired, grouchy, or any number of things? it is different if it is a startup company. if amazon was 100 people, it would be a different story, but amazon is not a start-up. and all of my executives work the way i do. none of the people who report to me should be focused on the current quarter. carol: now, the gender pay gap. we have been talking for a long time about how women are underrepresented and underpaid across industries. unfortunately, we have a new twist to the conversation, the wealth gap created by stock options. we dig into how compensation packages are favoring men. jason: and that has big implications in places like

silicon valley, where big ipos are mintingays millionaires and even billionaires. and the next class of angel investors and business owners. here is rebecca greenfield with the information. >> we looked at 6000 companies, and the data is solid. what they found is that women hold $.47 of equity for every dollara man holds. that is over 50%. >> that is important, because this is literally and figuratively the currency of innovation, startups, silicon valley, so implications just beyond dollars and cents. the money that can lead to down the line has a next financial -- has an exponential effect. >> to be clear, lots of equity does not turn into anything, but we can see that equity can turn into a lots of money for a lots of people. it can mean you get to buy a house, but it also means you become the next angel investor the next startup founder.

arguably, this is more impactful than the pay gap. carol: break it down, you spoke specifically about a young software engineer. we talked about people going in to startups. often you are getting a salary but often you are getting a stock option part of the pay package. tell us about her experience. >> one of the women we talked to was an engineer at lyft. she got a pay offer, and knew a man who got a similar offer. they were sharing stories, and it turned out he was offered more equities than she had. she took the job, but when she got there, she asked around and it turned out that she had less equity than all of them. even though the recruiter told her equity was standard and could not be changed. when she pushed back, she got more. but if she had not been really

aggressive then she would have been making less money. jason: one of the sub trends you point out is the notion of mis-leveling. >> when you join a company, they tell you this is the standard compensation, standard equity. and what i was told by a lawyer who handles these negotiations will say that a company will tell you this is your level, whatever, and this is what we offer. she said that, often times, you are being hired for a position that is higher than that. and if you just push back then you will get the equity that you deserve. carol: i am curious about the legality of all of this. can a company come out for a similar position and offer a man and woman with similar experience different pay packages and stock options? >> that is an interesting question. i am not exactly sure, but mis-leveing gives them some

cover. if they say this is the position you are doing and this is what we pay everyone. once we argue you do more work, then that is illegal. carol: macron has seen a setback. jason: plus, florence continues -- as floods continue to ravage homes in the carolinas this week, one city in the middle of it all is figuring out how to beat it. carol: this is "bloomberg businessweek." ♪

♪ jason: welcome back, i'm jason kelly. carol: and i am carol massar. you can listen to us on the radio. in new york, boston, and washington dc. jason: and in the bay area as well as london. in the economics section, french president macron's victory reverberated around the world, striking a blow for europe as unified the rising tide of nationalism.

but he has faced some setbacks. economic growth has slowed, and anti-european sentiment is growing. carol: call it his monumental challenge. he is now staking his credibility on next year's elections and is really aiming to show that the magic is not gone. let's catch up with editor christine. >> he had a state his future on being a leader in europe. to knit the countries closer together. and he had several proposals that he sketched out in broad strokes and now those seen at risk because of the loss of political capital. jason: how much of this is on him? how much of it is forces beyond

his control? >> he has not helped himself, definitely. 60% is on him. he called himself, at one point, jupiter, the king of gods. and he has spent the last year trying to walk that back, but still. it is this idea that i'm going to stun the world with the majesty of french power. i will use that power. but instead, and you know, people just look at him and they feel like he is calloused. in france, more than 70% of people feel he is ruling for the rich. carol: it is interesting reading that story. was there any kind of support for what he wanted to do? in terms of making the region even tighter? >> there has been this notion that he and angela merkel have common ground on these ideas. but the devil is in the details. the idea of having, for example, a joint fiscal budget.

one finance minister. that, you know, would be very tough to negotiate which country gets that. right now, we're seeing all of the jockeying going around. this would be another very important post. carol: he makes some promises to his voters in terms of domestic issues, but has not really come through. if he had succeeded in that way, what his star be a little bit higher? >> we have to give him credit in the sense that these reforms he has pushed through are not going to yield results. it is not just france's economy. we are seeing, across the country, germany is losing and dynamism too.

his government argues that there has been more hiring. in some of the things he has said really makes them come across as somebody who does not care. there is a sense now, he understands there is a problem. and in the last month, we have seen a change. this month, he visited a homeless shelter, announced a new policy on poverty. he has been trying to soften his language. saying we understand that, beyond the statistics, the government reports, it is about people, and people are suffering. jason: in the politics section, we continue to check the aftermath of hurricane florence and returned to one of our favorite writers. he has become a leading chronicler of how cities cope with a ferocious climate. carol: the city focuses on north carolina's largest city. they tear them down and have been doing this for 20 years. jason: climate experts think this could be the blueprint for the rest of the country. but it has taken a lot of political will.

here are the details. >> i went to charlotte, north carolina just before florence landed because they have one of the most interesting programs. they use their own money to buy out homes that keep on flooding. everybody points to charlotte as the example of how to defend against flood risk in the best possible way. i think hurricane florence is proving what is a good idea. jason: how did this come about? this is surprising, candidly, to see a government that is this forward-looking. this is not happening, obviously, at a federal level. what is triggering this? >> the answer is individual leadership. charlotte is not the most flood

prone place, but from what i can tell, the stormwater utility really cares about this. they were able to get local dive in to raise rates on local customers, not a huge amount of money. with that amount of money, they can afford to buy out dozens of homes a year. and over time, they have reduced the number of homes and their flood plans. that means that, though florence is a problem, will be less bad than otherwise. carol: you write this in your story. a house that no longer exists is, by definition, a house that

can no longer flood. here is the point, remove those homes from flood prone areas in those devastating storms that are increasingly happening. it also doesn't reduce costs when it comes to rescue efforts. that is the other side of this equation. >> i spoke with the gentleman who runs this program. he said it is not just a money thing. he is trying to think of all of the homes that, if they still existed, they will just put people in danger, but it means firefighters and police have to figure out how to get in, often by boat, often at night, and save lives. that means more danger for everyone. and that people come out, they go into shelters, they need federal aid. i do not want to paint this as an obvious picture, there are strong arguments for allowing building as often and widely as you can, affordability is an issue in this country, and lots of cities have issues finding land for homes. charlotte is saying "let's take the lance with the most risk, by them, tear them down so they are not a problem anymore." my guess is that more people will look at charlotte and say, as our risk grows, we have to look at options like this. hoping for the best is not a great strategy. jason: coming up, toyota is behind in the race to create a driverless future. carol: we also dive into the challenges facing driverless cars.

jason: this is "bloomberg businessweek." ♪

♪ jason: welcome back to "bloomberg businessweek." carol: ahead in this week's issue, engineers have 100 problems to solve in developing driverless cars. make it 101. we are talking about weather. jason: and the u.k. government

is having trouble getting anything else done. carol: it seems like every week we are focusing on something that is going wrong for tesla. jason: another piece of bad news this week. we checked out the latest bump in the road for tesla and elon musk. >> he tweeted a few weeks back claiming he was going to buy the company and there has been all of this back and forth over whether or not he has secured funding to do that. bloomberg news reported there is a criminal probe of these tweets. we already knew the fcc was looking into this. there is a lot of risk for

tesla. jason: some interesting reads the magazine this week. one was about toyota and their ambivalence on the future of self driving. max: toyota is viewed by some as in last place in this driverless car contest. the story in business week this week looks at the strategy behind this. toyota is taking a contrarian bet, saying we don't think autonomous vehicles are going to happen as quickly as people think. the real benefit is to make cars safer. carol: we still have to figure out weather.

max: there's a great story about seagulls, which could screw things up if they get in the way up the car. and snow is very difficult for conventional sensors in a driverless car to pick up. if there is a whiteout, you could get lost -- it'd be easier for a computer. jason: the technology is lazers instead of radar. light bounces all over the place and the car gets confused. max: snow is very problematic for lasers. there are other sensors that go into driverless cars, including radar, cameras, and also futuristic stuff. technology scans the bottom of the road to try to locate the car.

carol: this is technology archaeologists and the military already use. max: the issue is putting this together. you have all of these inputs and the car has to put these together and make a decision. you can imagine a world where it becomes get another input for driverless cars. the problems are all of these things added up together. jason: max just talked about some problems facing driverless car technology. the driverless car of the future cannot handle more than a dusting of snow. it alters the traction of the car and how its cameras perceive the road. carol: it is a known problem in the field and a little bit embarrassing. even the best autonomous driving technology is still struggling to navigate bad weather.

>> we as humans can negotiate weather scenarios, but the robots have a much more difficult time with it, partly because of things like snow or rain or fog. partly because it can cover markings, which autonomous vehicles rely on to stay in their lane. we are taking ground penetrating radar to create a map of the subterranean area. and we can use that map to navigate the vehicle with accuracy. jason: that sounds really cool, but i don't quite get what you are talking about. carol: how do you avoid the person in front of you if the radar is looking down? >> we are doing positioning.

by creating a map of the subsurface and relying on it, you are impervious to things like snow or rain or fog. jason: how does this become available to an autonomous driver? >> we drive over a lane and create a map of that lane and use it to navigate the vehicle. urban ride hailing and commercial trucking can allow us to create maps of the largest metro markets in the u.s.. carol: you are not saying this will replace the other sensors or gps on the self driving cars. this is meant to work with it. tarik: right. you need all of these independent layers of safety and security. the public wants to trust something you would put your mother or children in.

we believe lidar and camera are essential parts of the solution, but insufficient right now in terms of building a product that can be used in all of these challenging scenarios. jason: al gore believes it is not too late to do something about climate change and he believes investors can profit. carol: and another issue getting more urgent, coming up. jason: this is "bloomberg businessweek." ♪

♪ jason: welcome back to "bloomberg businessweek." carol: you can find us online. jason: and our mobile app. carol: now to climate change and al gore. he's been an environmentalist for decades. he made a documentary, "an inconvenient truth," that the world to global warming. jason: bloomberg sits down with

the vice president and nobel peace prize winner to talk about climate change policy interesting less than the future of the planet. >> if there is so much money to be made in sustainable finance, why haven't more investors flocked to this? >> anytime there is a significant change, inertia is an obstacle. this is because of human nature. the qwerty keyboard does not make any sense, but the transition to the new design has frustrated all of the keyboard and software companies. change can be difficult, but

once change is embraced, you feel the wind at your back. carol: al gore was just talking about what he is doing with sustainable investing. joel: he is all about the future. we need to have companies that benefit us tomorrow. an example is protera, 100% electrical buses. he positions that company as something that can displace diesel buses that are already going out of business.

that is where he is trying to find highly disruptive hings that do better for the planet and invest. jason: what is al gore's mindset? joel: we are 10 years past "an inconvenient truth." past the highs and lows of that period, he is thinking, how can we actually affect change? he is not going to let go of this fight. carol: does he think it is too late? joel: not at all. it is so easy to be apathetical. but he says you have a moral responsibility not to let that happen. you should look at where your money goes. that is the only way you can

really affect change. carol: what would you tell your younger self about what you've learned? joel: he has a great respect for the role business can play. a publicly elected official who looks at the business community and says, this is where change can come from. carol: a public official who has figured it out. jason: we have a team at bloomberg dedicated to c-suite. tell us about these remarks. joel: the old ceo of pepsi is going to be transitioning out, someone who was not white and not a man. now it there is this massive competition in c-suite, all-male and white. carol: this story is covered in the u.s. edition of the magazine.

let's go to jordan. despite this diversity commitment by companies, we still have a c-suite that is predominately white and men. jordyn: with the departure of female ceos, c-suites are getting more male and white. we are seeing diversity more at the entry-level. we looked at what was happening. jason: what did you find? stark disparity.

we hear this all the time about diversity inclusion efforts. you mentioned people left their jobs, the impact it had on the numbers alone, much less the perception is incredible. ceos -- 24t 24 female ceos. was happening is middle-management is where diversity goes to die. it's really that these companies are not looking and following through with the black latina women interns and new hires. that's because people don't feel like they want to stay. >> she's not bashful, she lays it out like it is, she says part of it is just freaking do it. there have been some any conversations, so many companies

that say they are going to do it. we are still talking about this problem. >> some countries or like we are just going to do it. one of them is citigroup. they said in three years they are going to increase the number of black managers, so that will increase diversity by thousands. other companies, they do a conference every year for the black and latino new hires to say this is how you get promoted. about interns a new hires, there's something deeper to get at this problem. jordyn: those relational factors. you have to make someone feel like they want to come to work every day. that's a big reason why people leave. when we are talking about the job, it is white-collar professionals. >> having dug into the numbers,

you have a team here devoted to all of this. more optimistic or less optimistic? >> it's hard to feel more optimistic. story, we are a going to check in with the interns, see if these new programs are coming down the pipeline do make people want to stay. neglexit.xit became this is delivered businessweek.

♪ carol: welcome back to "bloomberg businessweek." jason: you can also listen to

what's on the radio on sirius xm, in new york, boston, washington dc -- >> and in the bay area and london. jason: i love private equity. it is always a treat to sit down with one of the big executives in that world. they just sit at the nexus of investment and commerce. they get insights into companies no one else gets. the co-ceo of the carlyle group talked to me about the world of investments. >> the number of public companies that are around our half of what they used to be from 20 years ago. we are seeing companies that don't want to go public. there is so much more advantage to working with private equity in terms of long-term growth and value creation of what we can do to help ease companies drive value. we are seeing a tremendous shift in terms of the desire to partner with private equity. really private capital, you're

seeing growth in different asset classes, infrastructure, certainly credit, which is going twice the rate of private equity. i think there is an underlying theme at play here. you are going to continue to see the emergence of private capital at the expense of public capital. can do with money and all the value that we bring to our companies is certainly going to drive more investment opportunities in the future. carol: this is a pretty big week in brexit, with u.k. officials meeting in salzburg to try and make progress on a deal, with no luck. sides failed to come up with a deal to break the deadlock. jason: our reporter points out all of this single-minded focus on brexit across u.k. has led the government to stop working. she calls it "neglexit."

>> we are completely obsessed with brexit in the u.k. people outside of the u.k. don't think about it that much. it's become such a big deal here. one lawmaker coined this phrase "neglexit" because of the political turmoil it is creating, the constant questions about whether theresa may will be the prime minister next week, whether we are going to have a hard or soft brexit, the fact she has this minority government, which means she struggles to get anything done in parliament that is controversial. carol: what are some domestic policy issues that are not being tackled, and foreign-policy issues? >> one of the things we looked at was a big issue in the united states at the moment, flooding.

three years ago, just before the brexit referendum, there were huge floods before the brexit referendum kicked off in the north of england. the chancellor at the time promised millions of pounds to people up there. that money is sitting there in government waiting, it is being allocated but not being spent. people far away from london are being increasingly frustrated from this. many of these people are the people that voted for brexit, because many of them felt frustrated at the way their lives were going and the policies the government had. they thought brexit may be an opportunity to change things. they are feeling more removed than ever before from westminster. jason: from a foreign-policy perspective as well, it feels like the government is so internally focused, as well as from a citizenry perspective.

members of parliament cannot really content with much of anything, especially things beyond the border. >> the government is focused on securing a trade deal with the european union, and hopefully trade deals with other countries after we leave the european union next year. we have to understand how civil servants working government. bright young things will have innovative opportunities to make names for themselves in the civil service. that is how ministers become prime ministers. but these people just get brushed aside and say, we are so busy focusing on brexit. they are not thinking of anything innovative, apart from how to solve this conundrum.

jason: there are thousands of villages that risk becoming ghost towns. carol: better jobs and modern lifestyles lure people to cities around the world. we see remote villages they are leaving behind. jason: a few are turning abandoned buildings into towns with hospitality hubs. carol: we got more from our editor. >> this whole idea of living like a local when you travel has become big business. small towns are falling into disrepair and becoming ghost towns. 3000 in spain could be ghost towns in the next couple of years. enterprising -- of few -- a few entrepreneurs have decided to start turning these towns

into hotels, everything from churches to stables to hotel rooms. onon: there is a term whether or not you could live up to this standard. >> there is a term in italy. there are 100 of these places throughout italy. i have stayed in one of these town-hotels, very cool places. carol: do we have airb&b to thank for this? people are looking for more authentic experiences when they travel. >> you are just closer to the ground. you are living the way the people in that town live. people got used to that idea. they expect to be in the town looking like a towns person.

>> you are living the way people in that town live. they got that idea through the company. people don't expect to have all these services when they travel, they expect to just be living like a townsperson. carol: some of these towns are almost dying. no one is living there. >> when people went to live in the cities, the way of life left behind would be agriculture-based. that is not the way it is anymore. these towns are up for sale. $175,000, a whole town. these entrepreneurs are re-creating infrastructure in the town. carol: bloomberg businessweek is available on newsstands. jason: and on our mobile app. carol: your must read? jason: the u.s. cover story about the fed. love this store not just of the institution but of jay powell is a different sort of fed chair. he knows his way around washington. carol: my must read, let me paint a portrait. we know the gender gap that is out there when it comes to salaries and opportunities. i find it discouraging that when

it comes to stock option grants, women are just not getting the same as men. jason: more bloomberg tv starts now. ♪ this isn't just any moving day.

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emily: i am emily chang, and this is "best of bloomberg technology," where we bring you all of our top interviews from this week in technology. coming up, gaps online play for men. we speak exclusively to the gap ceo on the outfitter's newest brand. plus, visa spent 60 years building to be the world's largest payment network. its shares are soaring. but facing more disruption than ever, alfred kelly lays out his strategy. the retail industry also battling tech changes.