tv Bloomberg Business Week Bloomberg April 20, 2019 3:00am-4:00am EDT
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inflation that -- dead? this new era is confounding economists in calling into question the independence of the federal reserve. >> the fed is having a series of conferences culminating in chicago. it is a combination listening tour with a talk to people of all walks of life and affectional economists. they are trying to figure out what they are doing wrong. it is not just inflation by the way, it is broadly monetary policy, but inflation is at the heart. >> that leads us to an important point, monetary and fiscal policy. monetary being what a central bank does come a fiscal being the government, tax and spending.
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we have an administration that would be very ok if those two were done a little more hand-in-hand. there is a case to be made for that. lefties hate donald trump, and yet share some interest. both of them believe the economy can run hotter. telling them that the growth we deserve to have been holding back the stock market. people who agree with him trump on very little also believe the economy can run hotter. so the fed finds itself being attacked two very different directions. jason: running hotter would basically mean do not raise interest rates or cut them. that would mean the unemployment fall.all -- could
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but this idea of combining federal reserve policy, the idea of giving up the independence and working with congress, or something, or the government on fiscal spending policy. is one of thers people talking about secular stagnation a persistent chronic threat. kind of saying that the fed alone cannot tackle that. there is a chronic shortfall of private investment demand. more savings in investment that pushes interest rates down and the government can come in. by investing, soak up some funds. carol: we talk about that with infrastructure. there is all of this private
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money waiting to be put to work, and yet the government has not moved. you couldught is that crowd in. by having more government investment, rather than crowd out revenue investment, it might deuce investment. taylor riggs is here with another look at low inflation. >> this is interesting because despite all of the comments from the federal reserve, we can see their target or 2% inflation. here is their preferred measure, you had been a key -- you have janet yellen and jerome powell. and not even able to push inflation of. -- off. what do you do? carol: exactly right.
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carol: welcome back to "bloomberg: businessweek." jason: join us for bloomberg the everyday on the radio. and catch up by listening and subscribing to our podcast. carol: and you can find us online at businessweek.com and our mobile app. mercenaries, spies, double agents are all gathering in bogota. jason: the troubles in venezuela are turning the colombian
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capital something at casablanca -- like casablanca. carol: were seemingly everyone is trying to help or take advantage of the christ. -- crisis. >> something like 1,000,000.3 moved -- 1.3ve moved. immigrants have and columbia is relatively stable, i don't want to overstate that. jason: after years of being the opposite. >> that is right, these marxist guerrillas. suddenly, you have a country that has come into its own in a position to the welcoming of refugees. unlike syrian refugees in germany, they all speak the same
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language and same culture. carol: integration was never an issue, correct? >> yes, i have never even passed an immigration law is nobody wanted to move there. if thise says that continues, venezuela will surpass syria in the scale of its crisis. >> it is amazing. maduro situation with continues, they will reach from three-4,000,002 five or 6 million. jason: this is much bigger than those two countries. united states has taken a strong stance. how does the rest of the world play into this narrative? >> great question. i think there are several key points in the world today. centraleally become a
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superpower rivalry hotspot. the russians are really resisting the american effort, the trump administration, which does not have an active foreign policy, has taken a deep interest. jason: why do you think that is? >> several reasons. the whole shift in the region which was focused on leftist shift.m has begun to that fits with the ideology of this administration, which is very conservative. a great believer that socialism has seen its last days and that the united dates to help push it out of the region. there's also the revitalization of the munro doctrine. without any sense of it being old-fashioned has said that we need to say that in syria will not be dominant, this is our
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region. and with more work, we can get the cuban to play a big role. and in nicaragua. john bolton has picked a venezuela, nicaragua, and cuba as countries he views as a trick of terror. them play a to see role in turning the region around. jason: nothing dangerous could be named pizza bottom, right? carol: we have got an interesting map that shows the u.s. nuclear power plant that may be facing risk. jason: and if you look at the red dot, those are the real danger zone. it incorporates the number of flood risks that were not incorporated. you can see a lot of nuclear power plants and a lot of red. carol: conditions have gotten
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worse because of climate change. the whole point of the exercise is post-fukushima analysis is to look at what is the most extreme event that is possible enough that it is worth accounting for. the industry makes a point that, in any industry, there is always a question of how safe is safe enough. no perfect answer, but at least they are trying to get them data -- in the data. give us your best guess about what kind of flooding. the criticism is not around the process, so much what happened afterwards. in january, the commission said of the steps taken to address these updated risks would not be mandatory. and critics say that is not good enough. jason: these guys are not deeply incentivize to give a wish case
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to give -- incentivized a worst case scenario. >> to be fair, they have a pretty strong in vantiv to avoid a meltdown. -- incentive to avoid a meltdown. insisted in this country and a reliance on regulation. is -- itmportant it is is an example of the way climate change takes things a difficult. you have the system of risks and costs and climate change and throws it off wet. and also this separate question of what do you want to do? you cannot reduce the risk to zero, how much can you spend for the marginal increase in safety?
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carol: the owners have said that rather than redesigned land to address increased flood risks that it would be enough to store emergency meant in concrete bankers. the commission agreed with the industry finding, saying emergency agreement was adequate. and in january, they rolled it would be voluntary. is there political pressure? >> a five-member commission, three of whom appointed by republicans. the current majority says the current system is safe enough. they do not have evidence that is necessary to impose this requirement. the two minority members disagreed. there is this question of how much of that is just a function of the fact how much of it is this new deregulatory philosophy we're seeing under the trump administration. fact hard to separate the from the baggage.
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the people who are saying this is not enough tend to be environmentalists i've talked to them at length, they know their stuff. but their frame of reference is the priority of safety. for industry frame of reference and shared by the commission is less keep this is this working. this is a tough time for nuclear, they are under pressure from natural gas industry and from environmentalists. new industry has never won favorite with environmentalists despite their claim that they provide more carbon free energy than any other source. that has not gotten the many points. up next, we are able to keep phones secure, but cannot do the same thing with handgun. french tycoon host lady gaga can turn his year around.
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jason: welcome back to "bloomberg: businessweek." carol: you can also listen to us on the radio on sirius xm channel 119, and on a.m. 1130 in new york, 106.1 in boston, 99.1 f.m. in washington, d.c. jason: a.m. 960 in the bay area, london on dab digital, and through the bloomberg business app. carol: in the technology section , why we have smartphones but not smart guns. jason: firearms makers have resisted digital innovation that could transform public safety. >> the clinton administration cut a deal with smith and wesson, one of the oldest gunmakers in the united states. they said they would put in 2% of revenue, a substantial sum, into finding out whether there was a research path for smart guns. the administration really supported this of some folks
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supported, but the nra did not. if this was said smith and wesson was being traders, not loyal to the base of the nra. siding with the opposition. they put out a call to their members saying we don't support method weston anymore. -- smith and wesson anymore. overnight, they saw sales plummet and were sold for pennies on the dollar. carol: there is a statistics that says half of gun owners with it are buying a smart gun. >> part of the studies is that they all come from different organizations. there are some studies that come from lobbyists, but the reality is there is a lot of interest, but the people that are the most are eitherponents very opposed or very for it. we might have a lot of middle-of-the-road owners, they
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might feel a little more open to it. but then you have what we call super owners, people the 17 or more firearms. those are people spending money. those might be the most loyal. if the nra says we are not on board with this, that is going to be difficult to sell. jason: tell us about some legislation came through new jersey. a lot of this hinges on that particular law. >> you are right. there was an effort to bring them forward, however, the way legislation was written stated that if a smart firearm is available, it must be sold in new jersey. it would be the main firearm of new jersey. what happened as he saw in california and maryland, there were relatively small gun stores that started carrying this one firearm that the nra tested and
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found it was somewhat faulty. carol: a smart gun? >> yeah. technology, afid bracelet the owner would wear. they would try to shoot it and they said it would either be glitchy or faulty and would not work quite right. soon after, other views from less partisan organization found the same thing. they found magnets could unlock the gun, thereby defeating the purpose. peoplee these very loyal see this law in new jersey that says you will make us have to buy this gun? and they really were very unhappy. politics, iing of love this. on our podcast, we were joined by pantsuit politics cohost. toshe and her cohost aims talk about both sides of an issue in your that in a
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respectful way. -- an issue in a respectful way. here she is. >> because of my spirits, i thought i would do a podcast about women in politics. and i have all of these fabulous friends i will start interviewing women. interview, and i like to give answers more than ask questions. long, -- whena beth came along i thought this was a good idea. we had good rapport and chemistry. carol: terrific. he started how many years ago? what was the first podcast like? >> matt bevan had just been elected governor of kentucky, he was pretty trump. conversation in that it took off quickly.
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we stayed committed to just talking to each other. the important part is the vulnerability between the two of us. jason: -- carol: and you come at it from two different ways. you are more liberal and that is more conservative. how do you keep it civil? >> we talk about this in our book. it is not a secret sauce come it is a practice. it is not a one time you have a conversation. you're going to get it wrong, get fact wrong hurt each other, but your committed to the practice of listening. about engaging and curiosity. that grander vision about where we are going, instead of feeling like every time we have to come to an agreement about health care, that will not go anywhere. jason: and for more of our interview, check out our extra podcast. download that and subscribe at bloomberg.com.
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section, the finance this french billionaire has had a tough year. jason: he was indicated in a bribery scandal, one of his companies shut down. carol: he is still the number one shareholder in the event -- in vivendi. may also help his family regained and hold onto control of that empire. b -- vincent bola bollore isent dynamic. yes done this in multiple companies but the big one is vivendi. it is one of the biggest in europe, and back in 2014, he started with a small stake but exerted influence. he took over the board, became
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chairman, and now he has started a strategy to try and build something modeled on disney. carol: they call him the smiling killer. >> has a reputation of being a tough customer when it comes to taking over companies. the big one he has done is telecom italia. it used to be the state-run monopoly and he wanted to use the distribution to put vivendi content. that will be familiar to a lot of us. it is universal music, youtube, lady gaga, taylor swift. canal, thestudio biggest studio in europe. he had this dream of becoming a disney in southern europe, but it has gone sideways. jason: enter paul singer, not a phone call you want to get.
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>> yeah. for the last year, europe has been watching this amazing battle between holsinger the hedge fund manager and bollore. the problem is that it has loads of debt. and you are dealing with an old technology. land lines in the age of global, it is tough. singer smelled blood and saw value. he wanted to go in and take the board away and then spin off the landline business. he has won aded, succession of battles and taking control of the company. 24-25%, but it cannot control the fate of this company. that has been a rare thing. jason: tell us about the kids and the roles they play.
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his 39-year-old son is now the chairman of vivendi and his younger brother just went on the board. has stepped down efficiently because of all of these problems. his daughter runs the electric car company and sebastian, the oldest, is involved with a gaming company. less, itto do nothing is similar to the murdochs, he wants his children to pick up where he left off and his family has controlled, the wealth originally came from a paper company. they made cigarette papers. papers in bibles. he is taken this small company and transformed it into the empire. he wants to pass that on to his kids, but the question is investors want to know if they have the chops. next, call it an apple
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jason: welcome back to "bloomberg: businessweek." carol: still ahead in this week's issue, dominating the global ed market. jason: and lamborghini and bugatti both made a big splashes at the auto show. carol: and in our features a section, the entrepreneurial success story behind here in technology. jason: they have outfitted
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presidents and hopes with hearing aid and are preparing a new product for people who don't even need hearing aids. carol: it is fascinating. austin started a hearing aid company in his basement in the 60's. he had this vision that he was making money helping a guy and he watched what did. he says he saw how a transformed life and thought, if i'm a doctor, i can only change one life a day, if you're lucky. with hearing aids, i think it is a thousand times. literally, he has a vision, he sees this saying on the side of the bus. he sits on his bed and gives himself a pep talk. being a doctor is great, but if i want to change lives, i can bring hearing to the world. jason: they are rethinking the entire relationship and purpose of this thing. >> and everybody has always
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thought of it that way. his first vision was in the 70's and again in 98, very clear that the future was not a hearing aid of a communications device. --thought of it in your here year, you should begin to get that, translate languages, and all these things that were not possible in 1998. here we are years later, that is what they are doing. thatthey have realized this is a good place to take body readings. jason: when you take your kid to the pediatrician, that's how they take the temperature. >> exactly. and you can connect your phone to it. they looked at the various ways they could leverage the tech. smaller, mostly
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because of your iphone, all of these are tiny. they have turned it into a little computer. carol: this is a way to get so much information. >> they hired a guy who headed an innovative group at intel. they didn't drone's, tim of the spear technology stuff at intel -- tip of the spear technology stuff at intel. you can think of it like a little iphone. him,onder now, and i asked are your competitors going to be apple or google? you're putting technology in a place apple was not thinking about. this is a cool story, you can tell beloved. -- we love it. they also went through a tough time. >> some executives were caught defrauding the company. jason: just flat out stealing. >> and, while on the payroll of recruiting others to start a
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competitor. various things that are in clear violation of fiduciary duties. we're talking president, human resources change, cfo -- jason: a conspiracy. >> i refer to it as a palace coup at one point. jason: trying to create their own palace. carol: by that happening, as they brought in a bunch of new senior executives, is this what is moving the company to the next stage? yeah austin and his divine intervention idea, he spends most of his time flying in a gulfstream around the world fitting low income people with hearing aids. he felt like that is what i should be doing that i lost track of the company. i fell asleep and look what happened. because of this, he flew back in, tour up the sea suite, brought in new people.
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saying that was terrible, but it was meant to be, because have foundhe may that three years later when they take a bunch of his employees, who knows. jason: staying in the features, many americans to be among them. we think of tesla when we think of electric cars. carol: but warren buffett knows better. this chinese company is the global leader in electric vehicles. we have a chart showing projected sales and it is no surprise we expect tv to grow a lot -- ev to grow a lot. what is significant is the chinese share. jason: that is why byd is such an important player. >> byd is a big name, one of a few chinese auto brands that have taken off.
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what is interesting is it is pumping out more plug-in vans, trucks,lift then any other in the world, including a company run by a certain twitter addicted south african. lot to amplify electric vehicles in china. why hasn't it received more attention than someone who is on twitter and awful lot? -- an awful lot? for one thing, it is in china, a long way from english light which media that language media -- english language media. the passenger car business is essentially chinese, so unless you are there, it is not something you are exposed to.
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recently, they have not been in the glamour business. they are not trying to create status symbols. it is utilitarian, reasonably priced electric vehicles and they have been quite successful. jason: take us to the beginning. you mentioned the top, the battery pieces. how do they become what they are today? >> byd started in the batteries business. a chemist started it. essentially, it was a company supplying batteries for nokia feature phones. gadgets that emerged in the early volumes. a pretty troubled
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state owned carmaker, a really small company. producing a version of the ford pinto, a bit of a joke. but right at the time, and they are on record, they said they would make electric cars. we intend to make the cars and the batteries. that did not look like such a great bet until a little earlier off -- ev took off with byd at the heart of the boom. carol: and of retailer is breaking all the rules. jason: and some are calling foul on the gig economy. carol: this is "bloomberg: businessweek."
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"bloomberg: businessweek." join us every day on the radio from two-5 p.m. wall street. or catch up on our daily show by listening to our podcast. jason: and you can find us online at businessweek.com and through our mobile app. in the business section, you may be overwhelmed to ever step into one of this japanese retailers stores. carol: and that's just how they like it. >> the chain and bases itself on the fact that don quixote was unconventional and so are they. they are breaking a lot of the rules retail has had. when you think about large retail, consistency is something you impose. you have products in one location, you have been in 500. stores are arranged in the same, that is not the way it works. carol: chaos, it feels like. >> floor-to-ceiling sensory
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overload. carol: you have been there? >> i have been to one entitlement. -- in thailand. this is the made in japan phenomena. japanese love quirky, and this is quirky. it allows staff at each store to decide what the product mix ought to become how to be merchandised, and even allow them to purchase on a local level. carol: like letting store managers fill out the product mix lets them react to their customers in real-time. >> it is a place where if your local market wants to have dried, sliced gloves, you will have those. if your market is very fashion conscious, will give a lot more clothing. what they have done, they have expanded to singapore. in singapore and 80% of the
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store is centered around food. that is different than what they do in japan, where it is 30%. what they discovered his people want food in singapore and like the idea of a lot of japanese snacks and things. and it feels the chinese tourists -- appeals to chinese tourists. and you can change and turn on a dime. it looks like the weather is raining, all of a sudden, store manager says bring out reindeer. -- rain gear. if it is sunny, bring out all sorts of sun cream and umbrellas. it just gives you the ultimate control, as if each store is its entrepreneurial outlet. carol: i think i saw a revenue number forecast, something like $12.6 billion. >> it is very large, not just a couple of guys. this is, in its own way, a very
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unusual, but disciplined, retail strategy. by pushing decision-making as low as you can, it basically gets you closer to a consumer and makes the consumer want to shop there. and by having so much merchandise in a way that it is difficult to get through, you have built the sort of treasure hunt feel. line thatove that describes it as a mashup of t.j. maxx, dollar tree, and the no-frills grocery with japanese eccentricities. >> it is this mishmash of retailing styles. but that is what draws people, it is unpredictable. section,d the solution this is an app that restaurants can use to fill vacancies. jason: but the server is -- service is not free and some workers are not happy with the
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disparity in pay. us --is an act solved to created -- an app created to solve staffing issues but it is good for both as well. carol: how? >> it happens more frequently than you know, every time step in, there is a no-show. but there are crazy statistics that the average restaurant monthee has less than one in 22 days, and within 16 months, most will experience a complete turnover. and it costs close to $6,000 per employee. carol: that is not easy. >> to the rescue, this app called pared started by industry experts.
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started by a guy who knew what was going on behind the scene's and a technology expert. iu can get on the app and say need a dishwasher, and within an hour, some people walk in the door. jason: how does this work? you are cooked, i'm running the kitchen. carol: how about you are the cook and i am running the kitchen. >> you say what you need and they have algorithms that match you with somebody who has experience similar to the restaurant. they will match you with somebody who is in sync with your needs. carol: what will i pay jason and the dishwasher? jason: i thought i was a cook. carol: jason is doing at all. >> that is actually, there is an issue with pared. hour and mostn
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people in the kitchen are not getting paid that much. jason: interesting point, let's say i have a dishwasher for carol. i'm in the kitchen and my buddy does not show up. i shoved my job. she goes on the app, recently in, and i learned that this guy is getting 20 bucks an hour but only getting 15 or 16. >> you take your apron off and say i'm out of here. ,here are some things going on you are getting your taxes withheld on the app, succumbed ,pril 15, you have a big bill but it could definitely cause problems in the kitchen and people are comparing salaries. apps, haveking of you heard of kids singing and doing jumping jacks? carol: we will introduce that cars showed off at the
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carol: welcome back to "bloomberg: businessweek." jason: you can also listen to us on the radio on sirius xm channel 119, and on a.m. 1130 in new york, 106.1 in boston, 99.1 f.m. in washington, d.c. carol: a.m. 960 in the bay area, london on dab digital, and through the bloomberg business app. about features a section the next global big thing is made in china. jason: it is fun, reverend, and it is called tiktok. tiktok, no relation to bloomberg's tictoc service, is an app that was a little bit like fine, little bit like snapchat. it basically lets kids to do live streams and music videos.
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screens the teens and -- tweens. what is interesting is it is the first time one of these chinese internet companies has had a hit. jason: that is an important point. alibaba, but about those are essentially as big as they are. domestic chinese companies. >> and of the chinese market is so huge company just on the backs of those users. but what is interesting here is k, which grew out of a chinese app, was grown through the acquisition of another kind any -- company called music.ly. and if you are a social media user you have seen a day deluge -- seen a deluge of trying to get you to check out this app.
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according to one analytics trackers, it was the biggest app in the u.s., which is stunning. 13% of all facebook ads that ran on android phones were for tiktok. >> this company has raised an enormous amount of money of the most you from chinese investors. the valuation last year with 75 billion, putting it in uber territory. carol: what is facebook saying? they have got to be watching. >> they probably have a room full of people watching this. ,uring the analytic hearings you may revert mark zuckerberg getting into an interesting exchange with a senator who is talking about his journey from the dorm room to becoming this tech mobile. he said only in america. >> and he said there are some impressive companies in china. he's talking about tencent and baidu.
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and last year, facebook created a knockoff service called lasso. it did not go anywhere, but shows they had interestiktok hao tons of data, using ai to maniuplate the data. but all of this information has caught the attention of regulators. >> it is not like they are just an american style social network , it really is chinese through and through. and one of the ways it is chinese is it has this sort of data first idea. rather than focusing on social connections, the backbone of twitter, facebook, snapchat, it is focusing on ai and recommending content. into also much more censorship and privacy. there is no controversial content, it is not a political app. online, a reporter got a
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first look at the lamborghinis new car. here she is with lamborghinis ceo of the americas. the goal is to create a winger on the front number and on the rear hood where the car has more downforce, allowing the driver to be in the best conditions well driving -- while driving. this has been further improved. so agility, speed, and ease of driving, and control. and control here is the big factor of the evolution. ldi, thee have the lamborghini dynamic intergraph. it is an integrated vehicle
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assistance system that manages the entire dynamic behavior of the car. the brain is not anymore a reactive, but it is predictive. car weans that in this fit a lot of sensors with intention to read data and the attitude of the driver at the same time the car anticipates the steps of the driver. say in lamborghini it was artificial intelligence. level, but as already a step ahead of what we launched two years ago. and the suspension, the steering system, four-wheel steering the activegether and factoring works together, managed by this brain, to give the utmost experience.
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jason: and bugatti's head of americas showed hannah the limited edition car. >> the idea is to make something timeless. to connect the driver with the , too manyt too much items, but just the essentials. a design which will last forever. as you can see, this is the bugatti. you have some specific colors, you have the logo, 110, and the steering wheel is special. >> a unique shape. >> correct, like a formula one. you have for driving modes, and very easy. maybe we can start? >> of course. >> it sounds good, very good. they will know you are coming. >> let's have an idea of the
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sound systems. 16 cylinder. the only car with 16 cylinders in the world. carol: bloomberg businessweek is available now. jason: what is your must-read? carol: the story on hearing technology, it is a fascinating look at the hearing aid technology industry and of the men it who built this incredible firm. yes has created hearing aids for presidents, popes, celebrities, it is a fascinating story. jason: and looking around the corner, you start to think about that technology in an entirely different way. carol: yeah! yours? tiktok, i felt so cool at home because my 14-year-old watches these videos. i thought for equal being him -- feltow the story
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