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HBr presents.
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Hi, everyone, good to see two after hours. I'm yummy.
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I'm here.
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I'm Felix.
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I'm rally.
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And I'm Rebecca,
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and welcome. Yeah, we have a big group today.
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First time five people.
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We're so excited. You're about to be introduced to the best listeners in the world. Can I just tell you that? But
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how do you know?
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How do we know? Guys? How
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do we know you should see, compared to most interactions when people are anonymous. The interactions are just really, really pleasant, really thought provoking.
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They are the best listeners in the world. And for whatever reason, they appreciate us for our weird idiosyncrasies. And I know they'll fall in love with YouTube as well. Yeah, so
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the important question is, are you guys on Twitter? Of course. Okay, so Rebecca, what is your handle on Twitter?
1:01
Rebecca, recap? Or possibly recap, Rebecca, I can never forget.
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One of those two.
1:09
Okay, so everybody out there, follow Rebecca on Twitter, we're not quite sure what her handle is. But we feel confident you can find her and then rally Are you on Twitter,
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I am on Twitter. But I have never tweeted. I haven't found like the right first tweet. Oh, I've been thinking about it. The stakes are like so high. Like, what kind of genius stuff do I have to tweet? For my first tweet,
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I'm not on Twitter. But from what I hear, your first tweet will be visible to lots of people for at least two and a half seconds. So you better make sure. It's a really great country.
1:47
So everybody, follow these guys on Twitter. We're so excited to have you as part of the show this year. What we're going to do today is we are going to do predictions for 2021. We have done this for three years now. And I'm really curious as to what you guys think your best prediction was from last year, my best prediction. And this is way back in January, remember is I predicted that 2020 would be the beginning of the end of the British royal family. And about a month later, Harry and Megan defected from the royal family. And I got so many listeners saying how did you? How did you?
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I think in January, I did say on financial markets. I didn't say anything other than it'll be the most volatile year that we've had in the last 10 years. Wow,
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of course, I
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had no reason to understand why.
2:37
You had an April show that had predictions in it right in the middle of the well, I guess the beginning of the pandemic, from what I can tell you we're all exactly right about what happened between April and now. I'm so glad we invited Robbie on the show,
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you're gonna make an excellent
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insight.
3:00
Brilliant rally.
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Okay, predictions for 2021. Here, you want to get started? Well,
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this one I think I'm going to get started with is I think 2021 will be the year of just remarkably important climate legislation in the United States. And it will be the signature achievement of the Biden administration. And it will come in an unexpected way. Meaning it won't come through some big thing like a carbon tax, or maybe even something big, like the green New Deal. But the unlikely agents of it will be the Secretary of the Treasury Janet Yellen, and maybe the chairman of the Federal Reserve, which is Jerome Powell. So we will see them use instruments that we didn't really think could be used, like Dodd Frank or other things where they define systematic risk in new ways and force changes in the way we think about pricing, climate risk, and the behaviors of investors and lenders. So it's going to be a really remarkable year for climate legislation the knighted states
4:03
may hear I think it's going to be bigger than that. Very good. I think climate is really going to break through on a number of fronts. I'm hoping the Biden administration will get serious about mandating disclosure for private corporations and publicly held corporations against climate. I think we might get a social and cultural breakthrough, that climate stops being number 13 on everybody's list and become something like number two or three. So I'm completely with you. I think this is the year we'll see really serious movement against climate change in the US and indeed across the world.
4:38
One thing that's really interesting about your prediction is that sort of a continuation of policymaking outside Congress, that most of the action shifts to the Treasury shifts to the Fed. And in a way, it's nice to see that we get things done even though Congress is gridlocked. It's probably also the not such a great sign for the vitality of the democratic process?
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You know, I was going to say something just along those lines. Felix, which is a sort of a question to which is how sticky is this given that its executive authority rather than going through the usual processes? Are you worried about this sort of stickiness of it?
5:20
Well, I think I'm less worried for reasons that Rebecca, I think made clear, which is that, yes, Congress is not going to be the locus of a great deal of activity, as much as we might wish it to be. But underlying the sentiment to Rebecca's point has shifted to such a large degree and is ahead of Congress. And I think the reasons why it will be longer lasting, are precisely because public opinion is there and getting there. So in that situation, I think we can see things that are really persistent through time.
5:47
I hope both of you guys are right, I have to confess, I'm a little less optimistic. So I really hope the both of you are right on this one. rally.
5:56
Did you have one, I have been inventing predictions all day to share, you do have a couple I feel like I should start by quoting a wise master who will remind us always in motion is the future. Bruce Lee Yoda, Yoda.
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antithetical people as you can imagine this, this
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size is a little off, but the general direction was exactly right.
6:27
So this is a bit of a downer. But I think that this year will be a year to reckon with a kind of mental health crisis. And I think the relief that we look like we're going to be able to feel in 2021, that you know, this thing is over and we're moving on, we'll also be accompanied by the feeling that that actually only solved one of our problems, which was the pandemic and our lives still have all the other problems they had before, but in some ways, magnified. But maybe I'll give a better spin on this. I think this is a year in which attention to mental health will increase for everyone. I think it'll be a year when people will take mindfulness seriously, they will take meditation seriously, sleep routines seriously in a way that in the long run will improve probably everyone's lives. But in the short run, I think there's a real reckoning coming in this next year, with just how undermining of many people's mental health this process has been.
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I feel you're right, Raleigh. But I'm hopeful that this has been a timeout for many people kind of what are we about? Where are we trying to get to what is the point here? And I think many people are rediscovering that the point is, you know, could I give my family a hug. And I love to see friends for dinner. And thank God, I have a job. So there is an opening for a rediscovery of just the very basics. I mean, in many ways, our society was so much on a wheel, bigger, faster, you know, just driving, driving, driving that, I hope this might be the year when arts flourish, music flourishes, seeing and cooking with friends flourishes, that once we can get out together, we'll really start to rebuild our society in a different kind of way.
8:24
I think I'm with you, Rebecca. And there's already some evidence, I think, on this, which is polling suggests that actually, family life has improved during COVID. Now, of course, that's not universally true. I think some people have had very bad experiences. But I think actually, there's going to be a real appreciation for the more important things in life that has been sparked this year already.
8:44
I think many data points speak to the general polarization that you see across so many facets of lives, right? So you have the general data, that's a family life is better than it used to be. And then you have this quite dramatic increase in domestic violence and one at the same time, right? You have people who discover what's really important than my work, and then you have the millions of people who are out of jobs and so on. So in a way, the polarization I think that has shown up in the pandemic, it's, in a way, many elements of that polarization have become even stronger as a result of this really unusual experience. And maybe it's a good chance for us to then finally confront the deep causes of polarization as opposed to find the symptoms. That will be a real gift, I think, to all of us into the country. Felix, did you have one I had one and it was not very optimistic either. So we're starting out on a down there No, but so this coming year, we will see decent growth but the lowest profitability of Chinese firms in a decade. And broadly what's going on the Chinese economy is being rebuilt around state owned enterprises and The influence of government, and you see it in the decline in profitability. So for private firms return on assets is now run six 7% or so that's about half of what it was a decade ago. For state owned enterprises. It's now a 2%, down from 6%, about a decade ago, it matters in dramatic fashion. Because this remaking off firm government relations with a much more directive hand on the part of the government where even large private successes think of the delay in the IPO of and we still don't really know what's going to happen there. Or that's a sign that independent entrepreneurship is probably not a thing of the past. But the idea that you can do this at a significant distance from the government. And the state, I think, is an idea of the past.
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First of all, can I just say nobody told me I was supposed to bring data to support was just a wild speculation. So if that's true, Felix, you brought data, so it must be, but so doesn't that mean slower growth for lots of other parts of the world to, since so many other countries have built their models on exporting raw materials to China on trading with China? So that's a real drag on global growth, too, right?
11:18
So that's one possibility. And the other possibility, of course, is that you keep Chinese growth alive by just investing ever greater portions of the national economies well, into infrastructure, technology, everything else. So I would expect less of an influence on global growth, but more of an influence on how quickly can Chinese households become more affluent?
11:43
This is such an interesting prediction. Felix, I think, the question for me, because you think about China much more deeply than I do. This doesn't sound like a one year prediction, you're talking about a really changed relationship between the market and the state. Do you see this panning out over the next five or 10 years?
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I mean, it's always been the case that China was skeptical about civil liberties. So that's an older trend. But I think what's happened now is that trust in markets among Chinese leaders, is just very low, I think used to be that the idea was, if we bring more entrepreneurial spirit to state owned enterprises, that would be a way for China to balance, rapid growth, wealth creation and some sense of control. What happens now is sort of more the other way around, where Chinese state owned enterprises, they're the ones buying up, or at least, you know, acquire controlling shares in most of the promising entrepreneurial ventures. And that is maybe a more decisive change in direction. But the distrust of markets I think, runs really deep. And I think it's unlikely to change.
12:51
This is definitely a topic we'll be revisiting in 2021. I mean, I think the changes happening in China right now have so many ripple effects. Yeah. Should I go next? Yes, yes, yes, I don't know if this is positive or negative. But my prediction is that this is going to be a year of tremendous divergence. And what I mean by that is there periods of convergence, when all the players in a market starts to do the same thing. And then there are periods of divergence when they all start to do different things. So take workplaces, we used to be in a period of convergence, work expectations were generally consistent across companies. Now we're entering a period of divergence where some companies will embrace work from home, others will not some will do something in between lots of experimentation, lots of divergence, some of the divergence will be by industry. But even within industries, there'll be lots and lots of variation. Another example, higher education, we were in a period of convergence, where most colleges and universities operated in kind of the similar way, We're now entering a period of divergence where you're going to see lots of variation in how colleges and universities decide to operate, some will go full on into virtual learning, others will re embrace the physical, communal aspects associated with in person learning. Others will do something in between. Another example is healthcare. We were in a period of convergence, where if you needed to see a doctor, you made an appointment, you went to an office, We're now entering a period of divergence where depending on your circumstances, you may go to a doctor's office, you may do a virtual appointment, you may go to Walmart and get treated there. So lots and lots of divergence. So I think just across so many pockets of everyday life, where we used to seeing convergence, we're going to start to see divergence. And on the one hand, this is going to feel sort of exciting and dynamic. On the other hand, I think it's going to feel somewhat frustrating and a little confusing to lots of folks. But I think we should all just sort of be prepared for that.
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Do you think that divergence will come along with some productive experimentation. And I'm thinking especially about workplace policies.
15:05
I think that's the best case scenario is that you see a recognition that one size doesn't fit all. I do think though, there are some pockets of industry where the workforce as all the leverage, and I think there are other pockets of industry where the leverage tends to lie with the employer. So for example, take Silicon Valley, the best engineers in Silicon Valley have so much leverage, and they really have the ability to dictate the terms of employment. I think that's not the case in other pockets. But like I said, lots of divergence. And you're going to continue to hear stories about how this is the new way of doing things, when in fact, we don't know what the new way of doing things is.
15:45
That's
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the joke I made last week about trends and how we try to call everything a trend, because we try to create convergence where there isn't any, I think we're gonna just experienced that all year long in industry after industry.
15:57
I love where you're going with this. And it feels really quite plausible. But how does it intersect with massively increased concentration? I think we're also going to see this coming year, so many smaller firms going out of business, so many firms that are short of cash being bought over. And after all, I mean, entrepreneurial founding has been dropping steadily in the US for the last 20 years. Yeah. Is this going to be yet more of less entrepreneurship this coming year?
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I don't know if I would call it less entrepreneurship. I do you think it's interesting that we have new mechanisms for the long tail of the economy to subsist. So for example, you lose your job, you start selling masks on Etsy, or you create a little shop on Amazon. In other words, there's so many platforms now that essentially offer business in a box. I mean, Amazon offers business in a box, if you want to start a business, they'll basically do everything from inventory to fulfillment for you. It's not the same thing, of course, because the power dynamic now is very different. And as an entrepreneur, one of the benefits of being an entrepreneur, the way we're traditionally accustomed, think about it is that you take on a bunch of risk, but the upside really belongs to you. Under this new dynamic, that's not necessarily the case, because you are beholden to the platform on which you subsist. And so the dynamic is really changed in some pretty significant ways.
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So I agree with you young. In fact, one of my predictions is that we will see an enormous wave of entrepreneurship. Oh, in fact, I see the early beginnings, right around the corner from where I live, I must have now seven or eight new restaurants that opened within the last couple of weeks. Yeah. And it's true across the city. And when I speak with the people who open restaurants, you know, the story is very simple story. I wanted to do this for a long time, getting an empty space was basically impossible. And now all of a sudden, there are opportunities that didn't exist before. Pauline Graham at Columbia and co authors, they have an interesting study about the wave of entrepreneurship that followed 911. So 911, displaced about 18,000 businesses, a half a million people lost their jobs were dislocated. And about 15 months later, you have this wave of entrepreneurship in basically all manners that you can imagine, whenever you see these big dislocations, it sort of takes us away from business as usual, which is terrible during the face of the dislocation, and which has some promise for many people as we think about how to use space better, how to use assets better that we preserve during the pandemic,
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are you buying this Rebecca,
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sitting here thinking, I love how optimistic my colleagues that the edges, the real leavers of the economy are all going to be consolidated. And I'm simultaneously thinking, Oh, boy, I hope I'm wrong. I hope they're right. It really
19:11
strikes me, young me. But your prediction is that we see wonderful things coming out of it right choice and specialization and experimentation. And yet, all of the inequality that I can see that comes out of it will only exacerbate What are pre existing conditions of inequality. So for example, the advantages of remote work, we know will only really accrue, I think, to high income workers. So the tension between the two strikes me is really interesting, which is we do want lots more experimentation. We do want lots more choice, and we want all these things. And yet we know what will happen. And so it strikes me what's interesting about your prediction is we're going to need new ways to think about regulatory apparatus because I think all the forces that you're describing will actually be politically quite unpalatable. On the downside, even as much as we might appreciate the upside of what you're describing, I
19:59
have data Actually, one this remote working inequality. And so part of the story of all of this pandemic is, every inequality we had before was magnified every single one, gender, race, income, all of them. But I just wanted to share my data on the here's points about remote work, which is the ability to work remotely is highly correlated with income. the more money you make, the more likely your job is one that can be done remotely. And the less money you make, the less likely it is your job can be done remotely. And this is true across countries, richer countries have more jobs that can be done remotely, and poor countries have fewer. And so this sort of magnification effect is a really profound one in terms of teasing out some of the implications.
20:43
So you are, of course, exactly right, Ravi. But what yummy. Also, I think what you said is, for people who can afford to have the option to work remotely, we will still see a lot of heterogeneity. I know people who could easily work from home and they're dying to go back to the the first day their office is open, they will be back. Of course, the flexibility or the set of options that people have available to them will vary in the way you explained. But at the same time, I do feel that we will see firms that will basically go back to a model that feels very 2019. And we will see firms that have these radical ideas about remaking the workplace and how that shakes out, I think it will be super interesting to see,
21:29
my favorite thing about young lady's prediction is that it's really difficult to disprove
21:35
a few more predictions. And you'll notice that Rebecca, do you have another prediction?
21:40
I do. And it's related to yours. I think this trend towards business having a purpose, and the move away from shareholder value maximization. I think it's really here to stay. And I think it's going to accelerate. But to your point, I think there will be a significant fraction of firms that are like, not for me, but maybe 20, or 30% of the economy will really drive this idea significantly harder, I think we'll see a big change in reporting, I think we'll see a big change in flows of resources, where people want to work.
22:16
I think this is the year. I think the things to look for there, Rebecca are when you start to see businesses, lay down real targets, measurable targets, and then take the additional step of tying those targets to compensation. That's when you really start to see progress.
22:35
I think you're exactly right, young me and that's why I think we'll see progress this year, there will be a real move towards adoption of metrics that are auditable and verifiable and that firms will increasingly be reporting against those metrics.
22:50
I think one of the interesting points about this, Rebecca is maybe going back to young me's observation about the industries in which Labor has bargaining power, I think about so many of the 20 something year olds who are thinking about what they want to do with their lives, and they will not work for firms that do not express in some profound way, a sense of purpose to which they can connect.
23:20
So can I tell a story here, it's not data, but it's a real story.
23:24
Stories are stories you're totally did. Four years
23:27
ago, I get a call from a CEO friend of mine. And he says Rebecca, you know, I think all this sustainability stuff is both, don't you? And I said, Yeah, I know. He said, But everyone I'm trying to hire thinks it's a real thing. So I went over to talk to him. And now that firm is one of the most purpose driven firms I know, because absolutely everyone he was trying to hire care about this. Yeah, I think we're always exactly right. This is no longer a nice to have for many advantaged young people. This is what they must have where they work.
23:57
So I have to say this is one where I think we'll probably sort this out Rebecca for many months to come. But I'm just deeply skeptical. You know, it is potentially Yes. And interesting way to hire people. Is it the way we're going to solve the world's big problems? I don't know. Is it kind of a marketing stick for asset management companies kind of feels like it. And so I'm really curious to see how this shakes out. Because I confess, Rebecca, I'm still deeply skeptical, but we'll figure this out over the next several years
24:25
forward to this conversation. So it's gonna be a good time.
24:37
Okay, rally Did you have another one?
24:39
Yeah. Is it time for less serious ones?
24:41
Yes. Yeah.
24:42
Yeah. Because like, this is pretty pretty heavy. Yeah,
24:46
but this is a pretty heavy podcast. Okay.
24:48
Yeah, I know. I know.
24:49
Yeah. We do heavy topics every week.
24:54
Okay, so I think in 2021, we will see a wave of elective cosmetic procedures to respond to the fact that we've all been on zoom or teams or we've been staring at ourselves. For so long. I look at myself hours and hours every day. And I have to ask myself, am I this shiny in person? Does my hair look like that? Am I not sleeping enough that these bags into myself? I think after looking at ourselves for months and months and months on these virtual platforms, as soon as we're allowed to have these elective procedures, we're going to all be out there getting things tucked in. I don't know what to do about the shining this thing. So
25:38
rally, what are you signing up for?
25:41
I'm trying to age as gracefully as I can. So I will not do any procedures. I made a commitment to myself before, so I'm really just going to moisturize a lot.
25:53
Young me You have to introduce him to the face mask.
25:55
Oh, yes. Korean face
25:57
mask is your next podcast while we do Korean face mask?
26:01
What makes you think I haven't done that before?
26:03
Well, we are looking at you on zoom, right?
26:08
I'm sorry.
26:09
It's just bad lighting. Look,
26:10
this is a welcome. It's a welcome to the club robbery. It's just before,
26:14
okay, so I'm going to do a fun one as well, because we're always taking us down this direction. This is a continuation of a prediction I made last year. And that is Disney plus will continue to completely transform the competitive landscape for entertainment. I don't know if you guys saw this. So Disney plus had originally hoped to hit 90 million subscribers by 2024. It's already hit that number, it's now projecting it'll hit 260 million subscribers. By then, it announced 100 new titles from things like Star Wars and Marvel in Toy Story. And what we're going to see is the advantage of flywheel business models over firehose business models. So Disney's a flywheel where every piece of content fuels other parts of its business model. So those investments continue to pay off over time, whereas Netflix content has nowhere to go after you've seen it. So my related prediction is that either some big tech company, or some big media company is going to buy amc movie theaters. Mc is running out of cash, more importantly appears to be running out of ideas. Its market cap has been slashed in half. But it's a fascinating asset. So maybe Ticketmaster, Live Nation swoops in or a Disney or Spotify or an Amazon some company that's in a position to make these physical spaces one piece of a larger entertainment flywheel, as opposed to a standalone business is going to snatch up this asset. And it's going to change the way we think about entertainment.
27:45
That's a fun one. So the related question for you young me is not just on AMC, but you know, a year ago, pre COVID, everyone talked about the streaming wars. Now of course, with COVID, it all got delayed, because everyone was streaming so much streaming
27:57
everything right for kwibi.
27:59
Except for quickly, which was a big loser. Which I think as we suggested it would be, but just to be clear, now post COVID with Disney success, and Amazon's just the pressure of the streaming wars reappear specifically on Netflix.
28:13
Look, I'm not predicting the death of Netflix, I'm not just
28:16
what I'm trying to go for the what happens when Disney rises? Does anybody bear the brunt of it? Or is it just more and more streaming content forever?
28:23
They're very, very different.
28:26
I was going to say us, Disney is just a completely different animal. I mean, how they frame their content, who they're trying to reach, fabulous business model. But I think there's a significant chunk of the world's population that isn't going to walk.
28:38
Are you speaking for yourself, Rebecca.
28:41
I have a subscription. I really, really wanted to see Hamilton again. But I have no young children in the house.
28:48
Don't watch the Mandalorian. The Mandalorian is not for young children. That's like, that's just good television.
28:54
But what's interesting to me about Disney is there is no content. I mean, I can watch everything they have in one long weekend. And then what I mean, when I saw the numbers young me, I was so surprised. Because how often can you watch the same content over and over and over? And I understand the business model is super lucrative because it's attached to all the compliments. So that's fabulous. But the puzzle is, why do you have to subscription more than three and a half months,
29:28
I would point to both comments, the first one by Rebecca and the second one by rally. So Rebecca says I don't have young children at home. So children do watch the same content again and again and again. And
29:40
again, as somebody who has been forced to watch Parent Trap like 15 times. I can attest to that.
29:44
And then rallies point about the Mandalorian which, by the way, no one responded to everyone just stared at you blankly when you talked about the Mandalorian but the other audience is people who go really deep into these incredibly rich universes. Whether it's a Star Wars universe or the Marvel Universe. And there are huge swaths of the population that go really deep into these universes. I have watched every piece of Marvel content. And I don't know it took me like, not two weeks. If you compare that to the torrent of content, that is Netflix, it is,
30:22
I mean, I confess it's super successful. And I'm puzzled to see why,
30:27
let's say the Star Wars universe are we going to get like weird and nerdy now,
30:29
as opposed to the rest of the podcast?
30:32
Like, revealing some, although I did quote Yoda already, so might as well. But the content that you're describing is like elaborations of a universe that nobody else can do. And you can't have watched all of the Mandalorian because it's being released every Friday. And so it's not like Netflix, where you can just like binge all of them. It's like going back to this other era of waiting for things to appear and then being excited about their appearance. And I think that kind of excitement. The so Katana series, which was just announced, that's like, hundreds of 1000s of girls all over the world are beyond thrilled at the possibility of that. And that anticipation and excitement is really hard to replicate with any of the other streaming services,
31:21
you know, Felix's facial expression, prices. Unfortunately, this is an audio format. Here, take us off of this give us a prediction.
31:30
I'll give you a quick one, which is the summer of 1967 is known as the Summer of Love. Because there are parts of San Francisco that just became these havens of outdoor activity and love. And I think the summer of 2021. And this speaks to something that Rebecca mentioned earlier. It's just going to be an outpouring of artistic endeavors and live events and enormous excitement by young people who want to be outdoors. So I'm going to Chris in the summer of 2021 today, as the analog summer it will be known as the analog summer and it
32:06
doesn't really roll off your time.
32:07
I know I'm working on it. Come on. You're the marketing guru. Okay, look, I'm just saying that it's gonna be the summer where we we've behind zoom, live activities will enjoy just a remarkable Renaissance, including as Rebecca mentioned, cultural activities, and my opening bid on the name you are welcome to join in is analog summer of 2021
32:34
is that a hashtag?
32:35
I'm trademarking it now. Okay. Yeah.
32:38
Next, I'd like that one, though. I do. I mean, I made fun of the name, but I do like this idea of communal activities again, I mean, they're just gonna feel so exhilarating. Felix,
32:49
I have a prediction about barbers in Brooklyn.
32:53
very specific. Okay.
32:56
They will be busier than you can possibly imagine. One reason is, of course, the corona overhang that now requires a lot of shaving but more importantly, it is now pretty obvious that the year it is out. And the Van Dyke is the next big thing.
33:16
We love to Google stuff.
33:19
So these are beard fashions that change from time to time. And we're at one of these dramatic historic moments when they change very quickly so the year it is essentially a beard that you let grow for about a year or so without any grooming. So you look like someone from the Eastern Mountain of some ZZ Top Yeah, very good. And and the Van Dyke is a combination of mustache and a goatee. And if you want to see what this looks like, you should google Christian Bale or any other male trendsetter and he will see that is the new fabulous pure fashion
34:01
now you're looking a little scruffy today Felix Are you working towards
34:04
this? Yeah, I'm no I never went from stubble to yours that was just too far out.
34:10
So plastic surgeons and barbers are going to be very very busy.
34:16
Yes,
34:17
but we can add to the list young me I mean if we're going to take me here seriously, mass oozes
34:23
yes dance
34:23
instructors. I mean it's just going to be
34:26
lug summer analog
34:31
growing on you see you made fun of it. It's
34:33
a great idea me here but the name but I really like
34:39
rally. Give us another one. Silly one. Okay,
34:42
so well, it's not silly. I consider this to be very serious because it's about style, but not dire. And there are no lives at stake. Okay, which is we all had this rapid transition from mostly working in a workplace to mostly working At home, we ended up in sweat pants and jeans, especially the ones with a little bit of lycra in them little forgiving during the pandemic moments. But I think some of the comfiness is going to persist in workplace style, but with an elegance brought to it. And so I think we're going to see like in lycra like athleisure becomes elegant,
35:28
downright oxymoron pants with velvet trim,
35:33
I think there's going to be an element of completeness. But with style and elegance sounds
35:36
like a nightmare. Honestly, I'm staying home.
35:40
I think we know how you feel about the hoodies young me,
35:42
I think, Robbie,
35:43
I'm a little surprised because I would have thought the pattern for the cultural movement is a reaction against. So in a way I would have thought on style, we would have gone into a more formal vein in reaction to this. But you're seeming to suggest that there's something permanent about the comfort that we found during COVID that will permeate style on an ongoing basis.
36:04
That's such a great point here. I think that we'll have both in a way, there's no way we're going to get everybody back into formal stiff fitting clothes in 2021. Like you can't take away people's comfiness once they're comfy, but I think that there will be a niche of people. And you can count me among them, who are going to probably overdo it on the formal side. And we'll be in not formal wear but like, I'll be in suits. Again. For sure. Right. We know, and I'll be happy. But that won't be the big yummy.
36:38
Did you see how he did that? Yeah, he made it so that you can prove him wrong on his prediction as learning so quickly. I mean, it's both gonna be this and the opposite of this.
36:48
Awesome sort of slipped in a little bit of hierarchy. Judge knows like, I will be in suits. Yeah, but you people.
36:56
You like rob people? Yes.
37:01
But it was not very soft.
37:05
Okay, Felix, did you have another one?
37:07
This is a prediction about design as well, I think we will see finally, finally, the end of a furnishing trend that many people refer to as mid century modern, for the last 20 years, if you went into any furniture store that pretended to be semi cool. That's the kind of furniture that you bought. But now I think it's on its way out. You're referring I think, Felix, if I understand you correctly to kind of like the Mad Men look,
37:36
yeah, what would be available at like
37:37
72, or sort of the hardcore,
37:40
I had always associated that with also remarkably cheap and easier to make furniture. So part of what has happened in tandem with this Felix is that that kind of furniture is readily available and relatively cheap. So what comes next? Because it seems like things that are more ornamental or broke would be necessarily more expensive,
37:57
but also that particular design that you're referring to? It's so inoffensive, right? And every Airbnb, for example, around the world exactly, is designed this way. And so you get this commoditization of that particular kind of design, because it's relatively inexpensive, it looks sort of nice, and it's kind of clean. And as you said, it's not that expensive. And so it's hard for me to imagine that going away. So
38:22
maybe two things. One is for everyone who aspires to have the real thing, the real designs that actually has gotten very expensive. So these innocent looking chairs that you see in every lobby, there are 1000s of dollars. Why no one quite knows. But they're very pricey. And then it's interesting, we don't quite remember but the 80s and the 90s was this really bulky furniture. And now we forget, of course, the mid century modern was a breakthrough because all of a sudden, you could breathe, and you had a sense of more space. So
38:55
do you think it'll be more like bohemian?
38:58
Yes. So pastel is definitely out because that goes back too far. Sometimes it's more the texture than the color the color is actually maybe don't move as much. But so say velvet. You see velvet everywhere. More eclectic, Robbie, I think that's true as well. Yeah. To me, it's exciting because the older style was so dominant for so long.
39:17
See, this is back to my convergence. One style, and now what's going to replace it? Yes, stylistic varieties. Okay, here's another prediction. You are going to start to hear so many Bob Dylan songs in every commercial out there. Okay. So Bob Dylan recently sold his entire music catalog for several 100 million dollars. So these artists who used to really reject the notion of having their music used in an overly commercial way, are now just selling their music. So Stevie Nicks sold the rights to her catalog for $100 million other musicians that have sold this year Blondie Chrissy Hind, Motley Crue, imagine that there was a market locally crew. Yes. So lots of reasons. There's some tax benefits associated with this. I'm
40:13
so glad you brought that up.
40:14
Yeah, you know, I did that for you,
40:16
called 21. I taught it, and then I gave it on my exam. And then Bob Dylan sold his rights. It was too good to be true. But
40:22
also, I think that the prospect of this huge lump sum Payday is just so seductive to these artists. I think streaming services have kept these older hits alive. And so I think it's just fascinating to see artists after artists sell their catalogs. Meanwhile, the genius, Taylor Swift is trying to wrest control of her catalog back so she's going against the grain a little bit convergence and divergence. Here you go.
40:51
It works for everything rally.
40:54
Beautiful. Okay, me here. Give us another one.
40:56
So I have a prediction for the corporate turnaround, okay, of the year. And I think it's going to be Barnes and Noble. So James don't took over as the CEO of Barnes and Noble last year brought in by Paul singer of Elliott Management, and he is changing the entire format. And he's giving choice back down to local booksellers. And he did it with Waterstones and he revived Waterstones. And I think he's gonna take that chain and do something really exciting with it. And it's going to be the corporate turnaround last year.
41:29
I like that one that's so in line with analog summer. I mean, bookstores as the kind of nexus of community and people want to be there, and they want to talk to each other, and they want to listen to authors and have it be vast space that that sounds really right. Yeah,
41:44
there you go. I like that one a lot. Right? We do have another one.
41:47
I predict that people are going to realize that Facebook owns Instagram and WhatsApp. Because I think, mostly people don't know that. And they're gonna discover that when Facebook has to divest itself of Instagram and WhatsApp.
42:03
I love the way you frame that because we talk about, you know, should they be broken up? Should they not be broken up, but the reality is exactly what you described, most people need to be reminded that they're all under one corporate umbrella. That's very fun.
42:17
Well, I have a related prediction rally, which is on big tech, this will be the year of the settlement. Meaning both in Google's case, in Facebook's case, I think there will be a rush to settle in some way or another I'm not sure full divestitures. But I think we're going to see not protracted litigation, but in fact, a great desire to settle in one way or the other. And I think on big tech, there's real chances for a whole new regulatory approach with something that looks a little bit more like a digital agency, Allah what the UK is doing, so that we no longer have the kind of ridiculousness of the FTC trying to figure out some of these issues. So I think the whole issue of big tech and regulation is interesting, but I think it's going to be the year of the settlement. More than is gonna be the year of kind of protracted litigation,
43:02
we will definitely be revisiting this topic in 2021. If we're making predictions about companies, my prediction is Tesla will buy either Ferrari or Aston Martin, both of which do not have parent companies. Tesla's market cap is now $600 billion guys. It's now worth more than the nine largest car makers combined, including folks wagon, Toyota, Nissan, Ford, BMW, and Honda. So I predict they will, but don't ask me why. Don't ask me the logic. It's gonna happen.
43:38
I like it. And will you be first in line?
43:40
No, for the electric Ferrari. But then we could have like electric Aston Martin's and James Bond movies. See,
43:45
you're seeing this synergy already? Yeah, yeah. With like Bob Dylan soundtrack,
43:50
and streamed on Disney and showing in the AMC theater that they
43:54
Okay, we'll be right back with one final round of predictions. Okay, let's do one more round of predictions. My final prediction is that airline travel will start to come back in 2021 somewhat, and it will be a nightmare, particularly international travel, because vaccine distribution will be so uneven across the world. Different countries will require different health documentation, different kinds of health passports, rapid testing will be commonplace in some airports, less so and others, which will cause further delays. The rules regarding things like masks and other stuff will differ across airports in airlines to if you're planning on international travel, buckle up. It's going to be a nightmare. That's my prediction.
44:51
So my prediction young me is that the US is going to be a nightmare. Just the same way That we're not really going to get on top of things, that the vaccine distribution will be very patchy, that many firms will be reluctant to mandate vaccines that some parts of the country will be actively resistant. And that this is going to be a really bad year for the US that we're going to see a continuation of the partisan warfare, that there won't be a coming together and that the US will fall significantly behind Asia and Europe, because people will hesitate to come hesitate to travel, I'm afraid COVID is really going to do a number on the US.
45:36
So I was going to come in on the opposite side of that Rebecca, which is I think vaccine take up rates will be much higher than expected. I think the nightmare will be tracking who has taken it and the it around that will turn out to be a big disaster. And I think the final piece of it is I think like we're talking about vaccines today, the rapid testing regimes that will develop in the first quarter will end up becoming the centerpiece of our response, in conjunction with vaccines. But I don't think people appreciate how much rapid testing cheap testing rapid antigen testing will actually end up being the solution. So I'm quite a bit more optimistic about it. But I think mainly because of the testing regime that will come and because I think backscene take up rates will be much higher. I'm with Rebecca actually on this. I think that in a very general way in 2021, Americans will feel that they're living in a more divided country than they lived in 2020 or 2019, that the divisions will feel even bigger. And I think the vaccine rollout will be a metaphor for that. And it will fall along the same political lines
46:42
that climate might fall actually, as well and a number of other issues. And so I think it's going to feel worse, in political and social ways.
46:52
rallies court exactly why I'm worried is it will become a marker of identity and political affiliation. I really hope I'm wrong about this. But that's my intuition.
47:03
I think some of our really big differences, they tend to be starkest when we talk about principles. And when it comes to practical considerations, I think some of these differences melt away. And I think vaccination will be similar. And you see it a little less than half of Americans were willing to try the vaccine, as long as it was abstract. And in the future. I think now it's closer to two thirds who say that they will try to vaccine just because it's more tangible. You know, you trust your doctor, you go to your doctor's office, and some my hope, I don't actually know. But my hope will be that the more practical, mundane it gets, the more people will do it.
47:45
I'm trying to be optimistic as well. And I do think it depends a lot on the extent to which your ability to reclaim the way you used to live depends on you getting vaccinated. Let's say there's a concert you want to go to. And in order to go to the concert, you need to show proof of vaccination, let's say restaurants search or require proof of vaccination before you walk in, if that's the case, and I think, you know, Oh, you want to come and live in the college dormitory, you just need to show up to campus and show your proof of vaccination, then you can so I think it depends a lot on that. And I think if those policies start to get put into place, then I think you're gonna see some pretty rapid adoption.
48:24
So I had a prediction that I think it's useful to draw contrast here, you know, Rebecca, and, Ravi, one of my predictions is about the state of the United States with relation to the rest of the world. And I think in many ways, we will look back at 2020 as the Navy year of the US position in the world, which is, it has been a rough, rough 40 years, for the position of the United States in the world for many reasons. And I think it is going to be bottomed out. And I think we will all be surprised by the degree to which the United States retains or re assumes its position in the world, despite what has been an enormously punishing for years. And I think the rest of the world wants the United States to succeed and be back in the way it was once. So this is an enormously optimistic prediction. I understand that, at least by some perspectives. But I think we will look back at 2020 as the absolute bottom, as opposed to the second or third step and the decline of the United States, I think because so many people outside of the United States want it to be a country that stands in opposition to various ideas that are promulgated around the world.
49:32
Can I push back on that here? Yeah,
49:34
please.
49:35
I think that the transatlantic relationship, the relationship between the United States and Europe has been in trouble for a long time. And Trump undermine the sort of last shreds of trust, which were already fragile. I think it's going to be really difficult quickly to rebuild that trust between the United States and Europe. I mean, the words will sound a lot better But I don't think it'll be rebuilt very quickly. Which is to say one of the questions that European leaders have is, are we going to elect some other person who's not going to understand the European project four years from now? Like, there are lots of people in the world and especially in Europe who find it unfathomable, that after four years of President Trump, basically half of the country voted for President Trump again, like half of the country minus a little bit. Yeah. And then half of the country plus a little bit voted for President Elect Biden. And once you sort of wrap your minds around that, President Trump wasn't an accident, he could have been reelected pretty easily. I think Europeans will look at Americans differently and think, like, really, so this wasn't a protest vote four years ago. Actually, you meant it. And half of you wanted to do it again. Like what are we supposed to make of you people?
50:58
I mean, I guess I have three reasons for optimism on this front. You know, one is, as I mentioned, obliquely, I think the rest of the world wants the United States to reassert itself in some ways around the world. I mean, look at what's happening inside the China Australia relationship today. I mean, there's a contest of ideas that I think needs a forceful proponent on one side, and I think the United States can play that role. I think the second reason to be optimistic is I think, and this is gonna sound really, you know, Panglossian, which is, I think Trump is and was somewhat soui, generous, you know, he is a unique figure in the world. And I think the ability of anybody to replicate what he did in the United States is very, very limited. And then third, I think the secular demographic forces that are at work in the United States will make a repeat of what we have seen very, very difficult. So I don't know altogether, my instinct is, we will see the United States return in not i'm not saying it's gonna happen overnight rally. But my instinct is we're going to see the United States not continue to slide in the world, but actually begin its resurgence. What is interesting is that historically, at least seen from Europe when the relationship was strained. I was always surprised how easily can bounce back? Yes, Father, Bush,
52:15
I think because of the Iraq invasion was difficult seen from Europe. And then almost like week two, exactly. A new president come in, somehow things get restored, I think same for the younger bush. Even more difficult. Yes. And then Barack Obama gets elected. Exactly, it seems. So that's, I think, one interesting historical tendency. And then coupled with if you sit in Europe today, it's not as though you don't know populism. It's not as though half of your neighbors are anti immigrant. So the bigger historic forces that you saw at play in the United States, I think, you look around Europe, and you see the same forces at work.
52:59
I think I come down in between you guys. On the one hand, I do think the world is hungry for a restoration of order. And when the US historically has been at its very best, it does have the capability of reassuring its allies in that way. But the point where I come down on rally side is I do think the idea of America has been tarnished in a really significant way. And I don't know that pointing to Europe, engaging sentiments, there is maybe the best way to measure that. The way I would measure that is like when I was growing up among developing countries, any developing country that had an aspiration to be democratic, looked at the American political system as the ideal, we want to be like that. I don't think you will find developing countries that now looks at the American political system and says, Oh, that's what we want. I think those days are gone forever. I do think America remains a military superpower. We're an economic superpower. We're a cultural superpower. All of those things are still true. But I think the idea of America as a place that has somehow managed to make the melting pot work as a place where multiculturalism can flourish, I think that idea has been really, really tarnished. Yummy. I
54:24
think what you're pointing to is in a very real way, the end of the American liberal dream, but somehow the society was getting better and better. And yes, there was bad stuff in history, but we've really overcome that it's not such a big issue anymore. And what we've run into at 60 miles an hour, is it's still there. And there's a really different conception of what America could be or should be, that a lot of Americans subscribe to.
54:55
Yeah, I have a really strong sense that the future of America is really up for grabs. Yeah, that is Not preordained. Yeah, that's
55:01
for sure. True. Yeah, for sure got to be.
55:04
I mean, to hear you might absolutely be right. But what's concerning is it's not clear that you are. But I
55:10
think what I hope for and I believe in is that the doomsaying that I feel has become prevalent about the United States is overshooting. And that I think, is important for many reasons that Felix explained. And these problems are everywhere. The question is, what model is best suited to adapt to it? And that is something which we'll just have to see. The good news about this prediction is you won't be able to say that I was right or wrong until at least a 10 years later, at which point I will disavow everything.
55:51
Okay, hex rally, did you bring in a recommendation you were given instruction?
55:57
Yes. And one recommend I followed the instruction, okay. It's a novel. Okay. And it is one of the best novels I've read in a long time. It's written by a relatively young American novelist whose name is Madeline Miller. And the novel is sirsi, which in Greek is pronounced cure K. And I insisted that my kids call this novel cure k until I spoke with Madeline Miller, for this project I've been doing at HBS. And it turns out cactus as she calls it, yeah, she's amazing. She's totally amazing. But what it is, so if you like the Greek myths, which we do in my house,
56:38
okay, that just cut our audience in half.
56:42
The big story is like, you know, the story of Daedalus and Icarus. Okay, the story of the Odyssey, all those stories have been passed down to us in a very male centric way. And what this novel does is reimagine all of those stories through the eyes of someone whom we would regard as a minor goddess, seriously. And so it's like 1000 years of the Greek myths through a female perspective, nice. And it all feels totally different. Sounds amazing. And so it turns out, I don't think I'll ruin anything. If I say like, it turns out if you tell the story of Odysseus from the perspective of not Odysseus and not of Homer, he's a total jerk is like, wow, yeah, that was terrible. What he did, and so it's beautifully. It's very poetic, but it's just such a powerful reminder of how we can see the old stories differently. If we reframe them.
57:39
I love this recommendation. Rob, we can ask you a question because I got kids who are deep in Percy Jackson and Rick reordan. So what age does this kick in? Can kids read this? For sure.
57:50
Age 12. Great. Good to everybody in my house is read it
57:53
kids start rally. That's a nice recommendation. Okay. Okay, Rebecca, did you bring in a recommendation?
58:01
I have to Oh,
58:04
she joins
58:06
on the podcast.
58:10
Serious one and a mellower one. So like many of us, I suspect. A few months ago, I started reading everything I could about race in America. There's one book that I have found incredibly helpful, which is called 1861. And it's a book about why the Civil War was fought. Why is it the North just didn't let the South go? I mean, you want to leave leave? Why is it the North went to war, and the complicated interchange between slavery and politics and the idea of freedom in the United States, and all these huge ideas, but told through individual stories about individuals in 1861, and how they responded to the coming of the war. And I thought it was brilliant. It's as gripping as a novel. I thought it was incredibly insightful into what that period meant. And of course, how that keeps echoing down the years to today. Nice. 1861 fantastic, but that less serious, although you might think this is more important, is the cookbook that brought harmony to our household.
59:35
We all just perked up.
59:37
My husband and I discovered just a little while ago that we actually have not been liking the food we've been making for each other. We are totally united on is called the Four Seasons of past and it's the pasta recipes that you can do. In half an hour to 45 minutes, that tastes delicious, and absolutely fabulous. And you don't already know. Nice. And so that is my recommendation for COVID harmony in the household. The Four Seasons are fantastic.
1:00:15
So on the zoom, I can literally see all of us googling this book, right?
1:00:20
I got it.
1:00:21
I got it.
1:00:23
Felix, what do you have?
1:00:24
I went to the museum this past weekend for the first time in many months, and I was really looking forward to it. And then at the same time, I was a little nervous, will it be crowded. And I have to say, this was probably one of the best museum experiences of my entire life. Because as you all know, in many big cities, the top museums are the most visited sites. And so I went to MoMA, and it was empty. It was literally like having the museum to yourself. And it's because they gate the visitors in a way. So you need to sign up online. And I've looked around a little bit, it seems like most museums are doing this. And the way it disperse the people was just fantastic. And so my recommendation is if you have a museum close by, that manages the visiting process really well so that it feels safe during the pandemic. That is a fantastic experience to have.
1:01:24
Wow. That's an awesome, awesome recommendation. Oh, me here.
1:01:29
So I have been particularly crafty today, because I have one recommendation, but it really is like 10. So as you may have heard john lecarre. A passed away. Yes. And with his passing, I have just been really revisiting all his work. And it is so good. It is just so good. All of it is so good. And the good news is there are several novels that are incredibly accessible, dramatic, beautifully written. And then there are television adaptations or movie adaptations that are almost just as good. And so I'm thinking of the Night Manager, I'm thinking of the Tinker Tailor, Soldier Spy, the original 79 BBC version, as well as the Gary Oldman version from about a decade ago. that body of work and his insight into the human condition is like, amazing.
1:02:15
So me here, I read his stuff so long ago does it hold up?
1:02:20
I think it holds up amazingly well. And the ability to see it in both TV and movies as well as read the original work. I think you should spend if you're continuing in a lockdown. JOHN lecarre A is a way to wile away a few days, if not weeks of time.
1:02:36
I love that one. I haven't read those in forever. And I read them after my father read them. It's like yeah, me all sorts of nice warm connective feelings. I love it.
1:02:47
It's so funny because you said that because my father watched when the Tinker Tailor Soldier Spy debuted. It came in the BBC in 79. It probably came to the US in the early 80s. And I remember my father watching that, and how much it resonated with him. It's just amazing. The work is just absolutely transcendental. I think that's
1:03:05
brilliant. That's
1:03:06
a really nice one. Okay, my recommendation. And I didn't even know about this, but have you heard of amazon smile?
1:03:13
Mm hmm.
1:03:14
So if you shop on Amazon, which most people do, and you use amazon smile for all your shopping, it is a program that enables you to donate a tiny percentage of all of your eligible purchases to a charity of your choice. And what's amazing about this is it doesn't cost you anything in your shopping on the same Amazon website. So you change literally nothing about your behavior other than the fact that you designate your charity, and instead of shopping@amazon.com you shop@smile.amazon.com which is exactly the same website. The only difference is Amazon then sends a tiny percentage of every single thing you purchase to the charity of your choosing. And there are more than a million charities to choose from there. So even if you can't afford to write big checks, which I knew during this time, it's difficult for many people to do. You should check it out. amazon smile,
1:04:08
what a great recommendation. My
1:04:09
mother has one of the charities on amazon smile.
1:04:13
Oh,
1:04:13
what's the charity?
1:04:14
It's called Captain care. It tends to pets without homes and people who need help keeping their pets to take care of medical expenses and stuff like that. So it's basically all about the relationship between people in their pets.
1:04:31
Oh, that's fantastic.
1:04:33
That's so lovely. And then finally, I guess I want to wish all of you guys a wonderful holiday. Yes. One of the joys of my life is the friendships. Yeah, I just wish all of you guys
1:04:44
the best. Well said absolutely. To all of you and looking forward to a new year with all of you.
1:04:48
Yes. Yes. It's gonna be fun. In fact, maybe that's my last prediction. After hours is gonna be really fun. Thanks everyone. for listening. We will be offer cup of weeks but we will be back in mid January on a weekly basis. That's it. This is after hours in the HBr Podcast Network.