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tv   Bloomberg Business Week  Bloomberg  December 24, 2017 1:00pm-2:00pm EST

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carol: >> welcome to "bloomberg businessweek." julia: >> we in the bloomberg magazine headquarters in new york. carol: this week, the #metoo movement. manned -- withey a man wielding the wild to protect the outdoors. carol: and in a special section, what business is doing to help the world. julia: all of that ahead on "bloomberg businessweek." ♪ carol: we are here with megan
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murphy, let's start with the back of the magazine, peter metcalf. megan: i'm excited we are starting with the game changer, because we don't focus on a lot and it is focused on people doing things you should know about. a little known fact about me, i am a former big time alpine mountaineer. carol: are you serious? who knew? megan: in the mountaineering community, they are primarily known for very technical products. so you don't fall off the mountain. peter is particularly interesting, he has used his position, he stepped down in 2016 from the company, but he used his position and the outdoor industry to motivate them around issues that are important. this is our good business issue, we want to highlight people doing things that tie-in to their position in the business world, maybe it is a political point of view, things they think
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are worthy of society. julia: he was lobbying against the stripping back of federal protections for land. this is a huge industry. it cannot be understated. megan: it cannot be understated. this is before president trump and of the controversy we have seen about federal lands under this administration. we have talked about this before, there has been specific action by the administration to take lands that were formally federally protected around monuments, particularly in the west, causing a huge amount of controversy. federal protections of public lands in america and in other countries around the world is a -- is seen by many people as a natural right, they have a right to see the beauties and natural treasures. myself included. that believe that this something every human should experience with their own eyes. peter metcalf has been at the forefront. carol: i think it's another
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example of somebody in the private sector saying government, i don't like your message and i will take care of this. megan: he did this first in the outdoor apparel show, everyone supported this, saying this has to go into a statement that is what we believe in, access to the wilderness, these spots we want to protect. julia: what does the future look like? what are the plans? megan: he was big mountain climber. he does a lot of adventure activities. we talked how he has been kite surfing in greece. this is a man who has a voice and cause. i would not expect the cure from -- expect to hear from him, he will be a force i think or moralizing in terms of his space in san francisco, and a force we have yet to see, he is nowhere near done. carol: trying to protect another significant industry in this country. julia: speaking of a force for morals, from the back to the
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front of the magazine, a hit you you square between the eyes. that is #metoo. it is impacting different industries and i think how people are approaching women, the world, perhaps differently. megan: i'm so glad you said the keyword, which is women. #metoo and this moment of reckoning we are seeing is really about treatment of women and how women have fared and in some cases been overly assaulted, harassed, held back, and in some cases, much less quieter way that women are treated in society and industries. this takes a look at one that is fundamental, and that is the magazine culture, the sexualization of women, how women are made to feel about their bodies and how they are made to feel how they look. if this national reckoning is extending into some of these more quiet, furtive, accepted
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ways women are put in society. it is hard for us to get out of. carol: these remarks really move me. we have more on them. >> the harvey weinstein allegations started in early october, and within about a week, the #metoo campaign has started. i remember opening facebook and twitter one day and it was this cavalcade of stories. people i knew. being a woman and having reported on sexual harassment, i was aware of how prevalent it was, i knew the statistics, but it is different to see it in a numerical form and then find someone you grew up with sharing the story of something that happened to them 10 years ago and you never knew. i think for women and men, it felt overwhelming for a while. it calmed down and now it is in the news every day. you wake up and people are making jokes, who is this going to be? there have been rumors about
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people for years. the louis c.k. stuff was out there. there were some whispers about whether or not he was going to get caught up in this and he was. one after the other after the other. i think what has happened is this is something women have known about for a very long time. only now do they have a platform to be able to talk about it openly and in a way they feel comfortable doing and actually be believed. carol: a lot of people are wondering too, we've had discussions before, but is this time different? is something different happening? >> i think so. definitely. i wrote a story last your best -- last year about sexual harassment and why it was so prevalent. what we call in media as the peg. the reason for it. originally it was going to be about that and it turned into everywhere i turned, there were similar stories in every industry. women working at all levels.
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we wrote something, and it got response, but, you know, for the most part companies were not saying oh my gosh, we had no idea, we're going to change everything. it was still just sort of status quo, a lot of sort of legal checks, companies and employers can use to get around allegations. arbitration, settlement clauses. all of that still exist but they are being called out on it. carol: what is interesting is you are telling me that we are starting to see an evolution in terms of how people think about, men how they think about women because of the stories that have come out, but yet you still talk about hollywood, and how that if you look at the script and how they write about women characters, it still shows that that has not changed in hollywood despite all of the stuff that has happened. >> i find this fascinating. carol: i do too.
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>> before i talk about hollywood, i will say that advertising has changed quite a bit. you can turn on the tv and find men in detergent commercials. there is a cute one where a man learns how to put on makeup so he can play fairy princess with his daughter. julia: you named this great statistic, 40% of households and the united states have female breadwinners. you do have a significant proportion of men who are stay-at-home, dealing with these kind of things. >> even if it is both parents work and earn equal amounts of money, not one particular parent is going to be doing the laundry. advertising has figured that out because they have to sell their stuff and they need you to feel like you have a relationship with this product. hollywood does not necessarily have that. if you go to a major movie, the chances are, especially in blockbusters, it will be more stereotypical. carol: you wrote about how in
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the script they described a woman. tell us about that. >> last year, there was a producer who started a twitter account, and he is a producer and he also reads scripts. he started just writing -- his tweets are essentially descriptions of female characters in movies. he and analyzed them all as jane so that writers are not being called out. jane is a stunner even for her age. jane, 13, just coming into her womanhood or something like that. julia: that is quite benign. [laughter] >> they are just very bizarre. carol: the description about their looks. >> their looks or how you the viewer are supposed to feel about this woman. that is assuming that you the viewer are a man.
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it is still very common to write like that. carol: up next, a potential model for peace in the middle east in the form of a soda factory. julia: and the upstart selling muscles in mumbai. carol: this is "bloomberg businessweek." ♪
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♪ carol: welcome back to "bloomberg businessweek." i'm carol massar. julia: and i'm julia chatterley. you can find us online at carol: and on our mobile app. this week, a special section devoted to good business. julia: in other words, businesses mixing profits with good deeds. carol: we talked about putting it all together. >> just about anything could constitute good business. when you look at what a lot of companies are doing, you find that there are a lot of
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companies looking to do things like help people get more fit in india, which is a story we wrote about. or you look at academia and higher education, not usually a place with a lot of innovation, and you have someone like mitch daniels at the university doing a lot of innovative things. we spent the year trying to scour for stories like that. julia: i feel like there is a theme that crosses the stories, someone going above and beyond the call of duty in many ways. because they are passionate about something, they want to disrupt, they want to change, bring greater awareness. that is the biggest theme, beyond the business they are running. >> that is very right. we look at in india, we look at the gym chain. it is a fascinating story. india, as recently as the 1970's, had instituted caloric minimums. people were so underweight that the government said you have to eat this me calories.
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-- eat this many calories. an economic boom happened and now they have all the problems we have in the west of obesity, diabetes, and a quarter of all the people who have heart attacks in india a quarter of , them are younger than 40, which is insane. carol: i find this shocking, because when i think of india, i think of yoga. i think everybody in india does yoga. [laughter] carol: it's not a big deal. >> it's not. something like 97% of india does not do yoga. it is very small. and this gym chain has recently opened something like 20 locations in bangalore in one day. they now have more than 200 locations. they're trying to bring fitness to india. carol: it's interesting what he is doing, he's growing a lot. he's also trying to, as you say, they don't have physical education for kids and they're trying to reeducate the society. and it is working. >> huge growth, as i said, they opened 20 gyms in one day.
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it is not just reeducate, it is educate. for a lot of people going to the gym, they've never seen fitness equipment before. the idea of this western gym experience is new. julia: it's not coming from the government. >> no, this is all private. julia: they are not putting enough. speaking of education, let's talk about mitch daniels. he is a man also making a difference. radical in the education sphere. >> higher education is not a sphere where there is a ton of innovation, it moves very slowly. mitch daniels took over, two-term governor of indiana, known as the blade because of his cutting of budgets. he takes over at purdue and immediately does things colleges don't do. one, he froze tuition. for six straight academic years, tuition for in-state students
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will be under $10,000. this is that a time when a lot of competitors are seeing tuitions rise and rise, primarily because of a lack of state funding. he froze tuition. he's doing other innovative things, offering something called degree in three, which will allow you to come in, and if you are willing to stay on campus for two summers, which is not the most fun thing, but you can graduate in three years, which will save you about $10,000. julia: talk to us about the ceo of sodastream. he is another interesting character, someone who wants to change the world. or at least that part of the world. >> he is a really fascinating guy. sodastream is a fascinating company. if you remember soda stream, you might think back to 2014, there were boycotts. a factory in the west bank, boycott the saying it was an occupied territory. his whole thing, you can call it a shtick or not, you look at the gaza strip and you have 40% unemployment.
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you look at mainland israel, 4.5% unemployment. you cannot have peace in the middle east until you have economic equality. his argument is, i have a way in, we just have these factories. he moved the factory out of the west bank into the largest bedouin city in the world. he has palestinians working to -- next to israelis and jews and -- julia: egyptian jews, russian jews. >> everyone. carol: and they are getting peace through the workplace. >> exactly. his argument is, if everybody did what he is doing, all of the tensions would go away because instead of treating people like the other, you would say, i know this guy, i work for him, he works for me, we get along great. that is what he is selling, whether it can bring along piece is another question. that is the approach he has taken. julia: gracing the cover of our good business issue this week is microsoft ceo satya nadella. carol: we talked to our creative
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director. >> obviously he is a very powerful man, he runs an enormous company. we try to humanize him in this, and not put him in a formal business light that you are used to seeing him. he chose his own wardrobe. this is his casual attire. he is sundrenched and leaning against the railing. he looks fairly content. we thought it was a nice feeling. carol: in a company like microsoft where you have two iconic leaders so identified with the coming, you have to -- with the company, you have to make your mark, it's not always easy to follow. he is making his own mark and he will be a different kind of ceo. >> one of the takeaways from the interview, he is very empathetic. i think there is also the fact that this issue is the good issue, and it made sense to play this up. the headline is he is the empathy officer. carol: up next, reasons to be optimistic about raises. may be aboutsney
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to becoming the walmart of hollywood. carol: this is "bloomberg businessweek." ♪
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♪ julia: welcome back to "bloomberg businessweek." i'm julia chatterley. carol: and i am carol massar. you can also listen to us on radio on sirius xm 119 and on am 1130 in new york, 161 in boston, 99.1 fm in washington, d.c. and in the bay area. julia: and in london and asia on the bloomberg radio plus app. in the business section, a look et al. big and -- a look at how big and influential disney could be after it gobbles up fox studio. carol: here is reporter gerry smith. >> disney was already a huge
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force in hollywood, now you're talking about having the fox studio is part of disney, that gives them a lot more negotiating leverage with movie theaters, for example. you are already talking about disney having pixar, having the star wars films, and now combined with fox, you also have a huge franchise in avatar, which has a four sequels in the works. julia: in terms of numbers, if we are talking for the movie specifically, box office receipts. >> disney, when it is negotiating for films with theater chains, there is a negotiating about revenue share, usually it is 50-50. disney now has so many successful movies like a star wars movie, it could use that negotiating leverage with theater chains and demand a higher revenue share. that is something they could potentially do with some of the fox films, as well. carol: whenever you see this kind of combination, you wonder about how this changes the landscape in the entertainment and media world, how it changes hollywood. disney paid billions of dollars for the bulk of 21st century fox's efforts.
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-- assets. it is a big deal. how does it reshape everything? >> is a huge deal for hollywood. specifically, disney is making a big bet on the future. bob iger believes that in the future, we are not going to be signing up for as much cable tv or going to movie theaters. what he wants to do is create streaming services that go direct to consumer. you can subscribe online and never leave the couch. what this means is -- disney already plans to introduce a streaming service for a lot of its movies in 2019, and they could potentially use some of those fox movies for part of that, even potentially hold back some of those movies from being in the theaters and go direct to consumer as part of the disney streaming service. carol: does it make disney more powerful when it comes to negotiating for content? everybody needs content on all these services. where does that put disney in the stacking? >> that is interesting, because maybe five or six years ago, a
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deal like this would be really huge for people selling their ideas in hollywood. now, you have taken away a buyer, because fox and disney are under one-run, but you also -- are under one roof, but you also have new buyers. silicon valley companies, apple, facebook, amazon, netflix are all huge fires of content right now. in some ways, it does take away a buyer of film and tv ideas, but you have something more -- so many more buyers of content in hollywood than before. carol: productivity in the u.s. has been depressed for a decade, but finally showed signs of life this year. julia: we talked to our editor about what this may mean or -- for capital spending but also paychecks. >> it's going on about 1.5% growth, but this is after years of barely anything. it was 2.7% per year, up to 2000 and the eve of the great recession. the highlight this year is we are seeing services start to pick up your services are 64% of the economy.
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it is a big, important thing. the reason is capital expenditure. businesses are going beyond replacing older equipment to buying new equipment, investing in r&d, software and other technology. that is beginning, it is powering the uplift. carol: if we are all more productive we are going to be , kicking out more stuff. what is that mean for the economy? >> hopefully some of us will get raises. carol: that is another thing we haven't seen for many years. every time the unemployment data comes out, we see that more and more people are working, you would assume of the wages would start to increase but we haven't seen that. >> janet yellen testified before congress of the end of november and said that productivity, she thinks that is the reason wages have not been growing. once we see that sort of start growing more robustly, that will enable companies to thing about
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-- think about giving wage increases. it also raises the growth potential of the economy. it puts us on a higher track. it would allow the fed to start lifting interest rates without worrying about choking off growth. that is important because when the next recession comes around, central bankers are around the world are worried about how they will fight it when interest rates are so low. lack of total ammunition. a really important game. -- theme. let's get back to what you were saying about wages. the conundrum for businesses if you don't have productivity, if you try and raise wages, you also have to raise prices for consumers. what we're saying now, if we are starting to see productivity rise, they can do one without the other, which is critical. >> that is right. you are making more with the same number of workers. in the service sector, what is going on until now, and we think
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the capital spending increase is because people were able to hire more, wages were stagnant, and the choice was usually, take more people on rather than invest in automation. we have a nice anecdote in our story about a $14,000 sushi rolling machine. $14,000 for a small restaurant, that is more than half the wage, the annual wage of a worker. you start to look at this thing, in an make 200 rolls hour. a sushi chef can make 50. so the outlook begins to change if you see that wages, the employment is driving up wages because the labor market is tightening. julia: up next the opioid , detective that is not always right but still in high demand. carol: and why more and more women love ashley stewart. julia: this is "bloomberg businessweek." ♪ julia: welcome back to
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"bloomberg businessweek." i'm julia chatterley. carol: and i am carol massar. still ahead in this week's issue, handheld device that helps cops fight the opioid crisis. julia: the website you need to know about if you are curious about bitcoin. carol: and how a community helps the ashley stewart business model works. julia: all of that, ahead on "bloomberg businessweek." ♪ julia: we are back with bloomberg businessweek editor in chief megan murphy.
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in the technology section, i love the story. we talked about the evidence man and the role he was doing in fighting opioid addiction and using new and novel ways of doing it. megan: this is a story about a device called true narc. we talk so much about the opioid addiction and it is ravaging americans and the american economy. this is a device that is being marketed that can test positive for fentanyl, a deadly drug being mixed in a wide variety of opioid products. literally, they say a grain of sand is enough to kill you. this is why police forces across the country really need a way to test for it that -- they cannot touch it, smell it, it masks itself in substances that look like other street drugs. and this is why it is such a huge problem and why the demand for this device, it is
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expensive, $22,000, or so many cash-strapped police departments facing the ravages of this epidemic, from how they see families to halliday police, -- to how they police are looking , for something, anything to help them. carol: the trump administration has said this is one of their major initiatives, to go after the opioid crisis. where is the federal money to put this device in the hands of law-enforcement? megan: it is a huge issue. we have seen it even play out in the past few weeks and tax reform, where is the money that is going to do this promise of combating the opioid epidemic? fentanyl is lethal and it is now so widespread. i think we have to be realistic as a country in that how to fight this epidemic starts with getting the funding and it starts with education, starts with ways that are expensive and time-consuming and needs a cultural shift. but we cannot keep waiting on the sidelines of this epidemic,
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it is a sweeping through, particularly rural parts of the country. carol: i think it's great the magazine stays on the crisis it seems like all most every week. there is so much money in this industry, i feel like with a lobbyist in washington, it is hard, i feel like, to get significant change because of these relationships out there. the government and private industry. megan: absolutely. here is another thing, the opioid epidemic is most prevalent in the most disadvantaged communities in the country. the ones that don't have a political voice. this started in a poor, urban, appalachian areas. it has reached a tipping point. we stay with it in the magazine because we see that. carol: i'm so glad that you guys do. speaking of a forgotten community, this is more of the, story, of an upbeat ashley stewart is going in the retail world, after two segments of the market that really have been forgotten. megan: it certainly is. ashley stewart is a miracle
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story, it has survived to bankruptcies. it focuses on african-american overweight women. that is a sector that is among the most neglected in society, let alone in the retail industry. it is a positive story. it is a story of one man's belief in his communities, and kinship among women. it is a great story. julia: and i love the name. can i say the reporter on the story, she was moved by the workers there and what the stores are doing. megan: i think we all are. to go anywhere, i am someone who obviously loves fashion. to go to a place where you feel that you are embraced for who you are and what you stand for and who you are as an individual and not about what you look like, how much money you make, that is what actually stewart is about. -- what ashley steward is about.
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have our reporter for you. >> ashley stewart's clientele is primarily african-american women, and they are plus sizes. they may close in sizes 12-36. this is a interesting story for many reasons, it is a successful retail story. even though they filed for bankruptcy but they are doing well. >> they are, and they are really committed to brick-and-mortar. their 89 stores are primarily in urban, black communities. they are really, strongly committed to keeping those stores hubs of the community and having in-store events. that is what they have always been, that is where ashley stewart has found success, and these are stores that places where women feel good about themselves. julia: this is the critical
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point, as well. they do cater to a neglected subset of the female population in many ways. they are about empowerment, letting them dressed in the things they want to dress, rather than pigeonholing women in what they should be dressing. >> and women who are streetside, size, which is 02 10 12, thiszero to 10 or is not revolutionary. but when you are consistently told that your body is not attractive, that you are not attractive, that you are unseen, you are invisible, to have the kind of clothes you want to wear to have sexy lingerie, crop top, tight jeans, that is great. carol: these stores first opened in harlem, newark, bed sty. >> that was part of the idea. the brand has always been about treating the customer well and
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differentiating on that in a time when maybe customers were not treated so well or afforded some of the luxuries that higher end places do. carol: or there wasn't even any products. >> that was a big part of it, as well. when they opened in the early 1990's, they had a store security wore tuxedos, that was a big part of who they wanted to be. carol: they gave roses to customers, didn't they? >> yes. julia: tell us about who is leading ashley stewart? you talked about the fan -- a foundation of it. as carol said, it is have a pretty torrid time, even with the success. >> everything about the story is improbable, including the ceo is a guy named james ri, a child of korean immigrants. he grew up on long island. he comes out of private equity.
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he had not run an operating company before. he had been primarily an investor. he was a high school teacher at one point, he has a law degree, a very eclectic history. he took over this company about three years ago. carol: he knows the company well, though. >> right. he was part of the investing team in 2010 when it filed for its first bankruptcy. he led the team at that time. he could tell you he had a vision about what the company could be. some of that vision came to pass, some of it did not. hurricane sandy happened, the retail environment changed. he left that firm. the turnaround was incomplete, to say the least. he got a call back in 2013 saying, look, this is not working out, we are heading for bankruptcy, real liquidation, can you come back and help?
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and he did, and i think he has, there is a bit of it where he believes he was right. he really thought that initial investment thesis was not wrong, and he was going to prove it. julia: up next, the winning ground game in alabama for doug jones. carol: the rise of lobbyist turned regulators in washington. julia: this is "bloomberg businessweek." ♪ ♪
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julia: welcome back to "bloomberg businessweek." i'm julia chatterley. carol: i'm carol massar. you can also find us online at julia: and on our mobile app. in the politics section a peek , inside the successful senate campaign of doug jones in alabama. carol: and how he was able to get african-american turnout to exceed president obama in 2012. julia: here is our editor. >> one of the reddest states in the union, they had not elected a democrat in 24 years. that person was richard shelby, who soon thereafter switched to the republican party. this is a state that has really come up for all intents and purposes, no real democratic state infrastructure or party that has many links to it. -- legs to it. even before he won, people were thinking about it as, he had already pulled off the
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improbable. he had funneled millions of dollars of outside democratic money into the state without raising the hackles of conservatives who are wary of outsiders and national democrats. he had built up in a lot of ways through his campaign a state party that was sporadic and almost nonexistent. julia: the skeptics would look at this and say, everyone heard the allegations against roy moore, was this actually a doug jones when or a roy moore loss? -- win or was this a roy moore loss? particularly given the politics you just talked about. >> that is a totally legitimate criticism. when you look at the question we want to raise, whether this transfers at all, whether they can duplicate the success that jones had and spread it to other states, particularly red states in the 2018 midterms. you are not going to get the fundraising advantage that doug
1:44 pm over he doubled him up. that is not likely to happen again in any other senate race. you're not going to be able to replicate a polarizing candidate like roy moore. what lessons do translate? you look at the coalition he was able to build between moderates, young people, and the african-american turnout, which was quite substantial. when you look at places like tennessee and texas, immigrants -- democrats are hoping they will be in play next year, that is part of the playbook that they will want to take advantage of. carol: it is interesting, they were really on the ground and on the phones. they made a lot of phone calls, knocking on doors, going out to get the vote. >> that is right. and they were very careful. one of the most interesting comments we have in here is from somebody at the dnc, which is, they could not be overt about this. the last thing they wanted to do was nationalize the campaign and get, you know, this to be
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running on issues like abortion and gay rights, for example. they wanted it to be about a local candidate who looks like the district, strong guy, but they had to be very careful about raising this to the level of a national campaign, which is why, you know, you do not see people like president obama being very active there, cory booker came in a very late. they were very careful about how to do that. julia: when you talk in the article you talk about some of , the supporters were galvanized to action. what specifically was it that was garnering that energy? >> i think it speaks to the larger resistance movement out there. doug jones is a former prosecutor, he is well-known among democrats in alabama. to the degree that he was able to energize people as a personality, as a candidate, i think it went much beyond that. with trump in the white house and turning off a lot of
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moderate conservatives -- remember, alabama voted for him hands down, one of the biggest margins he had of any state. it was a knock on trump, and certainly a knock on roy moore. and i think you saw a lot of enthusiasm and energy in a part of the country where the democratic party has not been competitive for generations. carol: staying in politics, the trump administration nears the one-year mark. julia: and the repercussions of lobbyists turned regulators can be seen throughout. carol: why is bernhardt getting attention? >> he is the newly appointed number two official in the interior department. it oversees federal land and a drilling on federal lands, among other issues. he is getting attention because he came into that role from being a lawyer in private practice with a very long list of clients. which is not unusual for a natural resources lawyer, but he has graded challenges, he is at an agency dealing with his former clients.
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you have noble energy and various mining companies. a long list of clients that now are petitioning the agency. you are seeing, he has taken a lot of steps to mitigate that, he is complying with some recusal requirements. at the same time, they are making policy decisions at interior that match the former client wishes. carol: i want to talk about the broader story. it is pretty significant in terms of lobbyists turned into sympathetic regulators. with bernhardt specifically, there was a pipeline, it was not allowed to go under the obama administration, but with the new administration of regulator, something is happening. >> in his previous role, he worked with a los angeles developer and helping them, trying to help them get federal approval for a pipeline that would send water from the mojave desert to los angeles.
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he was blocked by the obama administration. what is interesting is just in the last year under the trump administration, a complete reversal in policy. the interior department saying the government approval is not needed to lay the pipe in an existing right-of-way after all. carol: that is a specific case. let's talk about the broader story. we are one year into the trump administration, and what we are seeing, and very senior positions in the administration and even lower positions, but who still can change policy, they were lobbyists and are now regulators. >> to some degree, it is nothing new. administrations of all stripes and presidencies have picked people from the private sector. democratic administrations, president obama pulled from environmental organizations. republicans tend pull more from the business side. we're seeing a lot of that. to a surprising degree, the number of people who were
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executives or lobbyists for private enterprise are now in charge of the same issues they used to work on. carol: another example you guys talk about a mining executive , now in charge of mine safety. a chemical lobbyist writing a chemical safety rules. why does it feel that, to be fair, why does it feel like now that we have the fox in charge of the henhouse, when it did not feel like that under the obama administration? >> i talked to democratic senators that say the volume is just so much more now. you are seeing it from the top and throughout the rig the -- ranks of federal government. at epa, the administrator, scott pruitt built his career suing the agency he is now in charge of. down through the ranks of agencies such as epa, you see a former lawyers and lobbyists working critically of regulations they previously sought to weaken.
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it starts at the top and is reaching into the ranks of federal government in a way that is surprising some folks on the hill and public government advocates. julia: up next the bitcoin , market trying to attract goldman sachs. carol: this is "bloomberg businessweek." ♪ ♪
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carol: welcome back to "bloomberg businessweek." i'm carol massar. julia: and i'm julia chatterley. you can listen to us on the radio on sirius xm 119 and on a.m. 1130 in new york, 99.1 in washington, dc and in the bay area. carol: and in london and asia on the bloomberg radio plus app. in the technology section, a website is used by cryptocurrency buyers.
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julia: it is trying to prove it is safe enough for goldman sachs. carol: here is our reporter. >> coinbase is one of the most popular places to buy bitcoin. it is like a household name. carol: how much is going back and forth? >> they have exchanged $57 billion of digital currency in 2017, the last number i heard from them. carol: that is a lot. they have got to be excited by the attention that all of a sudden the world is a spinning -- is spending on bitcoin and digital currencies, and the meteor cries of bitcoin. >> i think it is exciting, it also poses challenges. this is a 225 person company. in a lot of ways, is still a startup. it is on one floor. there is still that startup
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charm when you walk in. there is a ping-pong table, a beer fridge, but they have doubled the size of the company's year and they will double again next year. they are ultimately looking at an ipo. they are sort of growing up. carol: who are the people behind it? >> it was cofounded by a man named brian armstrong. he was in the tech world. a lot of the guys are from silicon valley. coinbase has two separate exchanges. is for retail investors, and they also have an asset exchange that is for institutional money. carol: let's talk about that. how much is retail? how much is institutional? breakdownt have the of the numbers, but what i can tell you is that by account numbers, most of the customers are retail investors. most of the trading volume is from institutions. when i say institutions, i mean small cryptocurrency hedge funds.
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more than 100 of those have popped up just this year. carol: not really retail funds? >> not yet. the ceo said to me it is not goldman sachs yet, but i think it will be. carol: let's explore that a little. that's what they want to do, they kind of want to use coinbase and digital finance to revamp money. what is their goal? >> they have an ambitious goal. they want to reinvent the global financial system. what they see in five to 10 years is a world where maybe you don't have to go to a bank to get along. -- get a loan. you could do it online through a company like theirs using digital currency. there are all the steps they have taken to get there. the first up was creating an exchange and targeting retail investors, the everyday person. the next step is targeting the big wall street money. carol: let's talk about the wall street money.
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i feel like we get mixed messages from wall street, folks say bitcoin makes no sense, and yet they certainly are spending more r&d time and money on bitcoin and its uses. does coinbase need these big financial firms? >> it would certainly help. you have people like jamie dimon that says we will fire anyone who trades bitcoin. big banks cannot ignore this. all of their clients are asking for it, but they have to worry about reputational risk or customer rules, and they realize that in offering products to try to solve that problem. carol: what they do need to become legit is they need regulatory oversight. i assume they expect that. do they want that? >> that had a pretty friendly attitude toward regulators. the way they are currently regulated is a patchwork system through states.
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they have licenses in 38 or 40 states, and they are federally regulated. but they are not federally regulated by the fcc or those big traditional financial regulators you think about. we may see that happen at some point. carol: "bloomberg businessweek" is available on newsstands now. julia: and online at carol: i loved clears a story. she talked about how we are seeing cultural institutions and how they are changing writing about women. i think it is good they are doing this. we are seeing a slight changes. julia: and yet she contrasted it with hollywood scripts and the way they describe women. perhaps greater work needs to be done. carol: loads to be changed but i'm glad the conversation is happening. julia: more bloomberg television begins now.
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