● Sam Altman’s next move 20

● The race for a new banana 42

● A rout in renewable energy 12

December 4, 2023

A Deepfake Horror Story

Teenage victims of generative AI porn
fought back—and showed just how unprepared
the world is for technology’s new frontier 34
December 4, 2023

◀ An electron
micrograph image of
Fusarium odoratissimum,
a naturally occurring
fungus that kills
banana plants

FEATURES
34 Fighting Deepfake Porn
A group of teenage victims took matters into their own hands
EYE OF SCIENCE/SCIENCE SOURCE

42 Can Science Save the Banana?

Biotechnology might be the fruit’s only hope against a deadly fungus

50 Tallying America’s Trauma

The Gun Violence Archive provides real-time data the government can’t
◼ CONTENTS Bloomberg Businessweek December 4, 2023

◼ IN BRIEF 9 Hostages come home ● Holiday sales sizzle online ◼ COVER TRAIL
◼ OPINION 10 The Supreme Court’s new ethics code has no teeth How the cover
◼ AGENDA 10 COP28 in Dubai ● Voting in Egypt ● Skating in Beijing gets made

①
“So this week’s story is
◼ REMARKS 12 America’s clean energy future seems further away about deepfakes.”

“These are getting too

BUSINESS 14 ▼ LVMH is training a generation of luxe artisans in the US good. I thought the pope
1 truly was a Balenciaga
fan for a few months.”

“He did look great in that

puffer—but the story
we’re doing is decidedly
more dark than that.”

“Oh, no. …”

“Someone made
pornographic
deepfakes—1,900 of
them—of his high school
classmates.”

“I’m speechless. Did they

find out who did it?”

“They did. But it turns

out making fake porn
from real images
isn’t illegal.”

“Well, that’s upsetting.”

“Think we can bring it

into an image?”

“Yeah, but it’s going to

4 be disturbing.”

17 Move over, Detroit. Chinese cars are all the rage in Mexico

TECHNOLOGY 20 OpenAI’s CEO is back, but the power struggle continues

2 23 Microsoft’s unusual AI partnership reveals its risks

FINANCE 24 With tighter capital rules looming, banks are fighting back
3 26 A megadeal for UniCredit? The money’s there

ECONOMICS 30 In Europe, large stimulus is a thing of the past

4 31 Canadian and can’t afford a house? Try Alberta
33 Actual inflation since 2020: You’re not going to like it BUSINESS: PHOTOGRAPH BY ADRIENNE GRUNWALD FOR BLOOMBERG BUSINESSWEEK

◼ PURSUITS / 55 For an easy way to start the party, say, “Cheese!”

HOLIDAY ENTERTAINING 59 Give your guests the gift of bacon on a buffet table
60 New hotels in Panama City’s old town make it a must-see
62 Maestro pulls back the curtain on Leonard Bernstein’s life
63 Serve perfectly chilled wine to even unexpected visitors

◼ THE SHOW 64 Creativity is essential to moving work forward

How to Contact Bloomberg Businessweek

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Cover:
Illustration by
Lulu Lin
◼ IN BRIEF Bloomberg Businessweek By Mark Leydorf, with Bloomberg News

● Retail analysts were

● War in the
underwhelmed by Black
Friday, when spending Middle East
rose just 2.5% from 2022, ▶ Negotiators from Qatar and the US
continued to press Israel and Hamas
according to Mastercard to prolong the truce in Gaza. But Prime
SpendingPulse. But Cyber Minister Benjamin Netanyahu stressed
on Nov. 29 that Israel ultimately intends
Week lifted their spirits. to resume warfare to eliminate Hamas
According to Adobe Digital and the threat it poses. “There is no
situation in which we do not go back to
Insights, the five days from fighting until the end. This is my policy.”
Thanksgiving through
▶ Saudi Arabia approached its long-
Cyber Monday generated term rival, Iran, with an offer to invest
$38 billion, an increase from in its sanctions-stricken economy if it
stops its regional proxies from turning
last year of the Gaza war into a wider conflict.

7.8%
● The Supreme
Court is mulling
“Believe
whether the SEC me, you do
can fine people
without a jury trial.
not want to
live in my 9

universe.”
Currently the US Securities and
Exchange Commission can bring
“administrative proceedings” before
its own administrative law judges, rather
than bringing them in regular courts. Ruby Chen, the father of soldier Itay
George Jarkesy, allegedly involved in Chen, 18, who was kidnapped near the
a boiler-room fraud, fought the SEC’s Gaza border on Oct. 7, speaking at a
action against him by arguing it should news conference on Nov. 28. “It’s hard Khalil Al-Zama’ara (top) hugs his mother at his home north of Hebron in the
have to sue him in actual court. He to describe the feeling of not knowing occupied West Bank on Nov. 27 after being freed from an Israeli jail in an exchange
won that argument in a federal appeals if your kid is alive or not. It’s a feeling for hostages Hamas released from Gaza. Sahar Kalderon (bottom), 16, who’d been
court in Texas last year. beyond pain.” held in Gaza since Oct. 7, embraces a relative in Tel Aviv on Nov. 27.

● ChatGPT,
WEST BANK: HAZEM BADER/GETTY IMAGES. ISRAEL: IDF/AP. MUNGER: HOUSTON COFIELD/BLOOMBERG
● Miriam Adelson, widow ● The Mellon Foundation
● Charlie Munger
of casino magnate Sheldon on Nov. 28 announced it had
died on Nov. 28.
Adelson, is selling meet doubled its funding for the

$2b
Monuments Project, to a
Amazon Q.
$500m
of stock in Las Vegas Sands commitment. The project
so the family can acquire a aims to transform the The 99-year-old vice
chairman of Berkshire
majority stake in the NBA’s commemorative landscape Hathaway was Warren
Dallas Mavericks from Mark in the US to better represent Buffett’s closest partner
and “right-hand man.”
Cuban. Cuban will continue Amazon.com joins Microsoft and
its diverse history. So far, Munger served on many boards
to own a part of the team, Alphabet’s Google in rolling out its Mellon has provided about during his life and gave hundreds
own workplace chatbot. Amazon Q is of millions of dollars to various
with multiple media outlets designed to help corporate customers
$170 million to help preserve schools, in particular the University
speculating the deal is search for information, write code and or create 80 monuments of Michigan and Stanford. He
review business metrics. In an effort was famous for having an ethical
the latest sign that the to reclaim ground in a field led by its
celebrating often approach to investing. “Good
65‑year‑old tech billionaire main rivals, Amazon Web Services, the overlooked Americans. businesses are ethical businesses,”
retailer’s cloud computing division, is he told Wesco shareholders in 2009.
plans to run for president. weaving generative artificial intelligence “A business model that relies on
into more products. trickery is doomed to fail.”
◼ BLOOMBERG OPINION December 4, 2023

also consider the high court’s. At the least, the chief justice

The Supreme should be empowered to review and rule on recusal judg-

ments made by other members, and they on his.
Judicial ethics are of paramount importance to democ-

Court Needs racy. It doesn’t speak well of the justices that they’ve failed
to grasp the obligations this imposes on them. And it was an
insult to claim, as they did in a patronizing statement, that

An Accountable the new code is merely a matter of clearing up the public’s

“misunderstanding” about the court’s rules.
It’s now up to Congress to hold the justices accountable.

Ethics Code In drafting legislation, lawmakers should strive for ­bipartisan

consensus—which shouldn’t be hard, given the biparti-
san nature of the court’s ethical breaches. They should also
take care not to allow ethics enforcement to become polit-
Holding judges to high ethical standards is essential to the icized. But they can’t let the court’s blindness to its own
American legal system. The US Supreme Court’s recent injustice continue unchecked. <BW> For more commentary, go
adoption of an ethics code is an overdue acknowledgment to bloomberg.com/opinion
of this reality. But the court’s failure to include any enforce-
ment provisions reduces the code to a paper tiger. The pub-
lic shouldn’t fall for it. ◼ AGENDA
Where ethics are concerned, the high court has long taken
the approach of adopting “rules for thee but not for me”—
requiring all other federal judges to adhere to high standards
while exempting itself. Not surprisingly, the justices have exhib-
ited a series of embarrassing ethical lapses, including failing to
10 recuse themselves despite owning stock in companies appear-
ing before them; failing to disclose lavish vacation gifts; using
public employees to help promote and sell books; and accept-
ing free accommodations for themselves and guests.
These breaches have led to a public outcry, and rightly
so. They stain the court’s reputation and reduce public con-
fidence in its authority and independence. At a time when
public trust in democratic institutions is low, such failures
are all the more intolerable. A Gallup Poll this year showed
71% of the US public had only some or very little confidence
in the Supreme Court.
Yet the court’s new code could well breed more public cyn-
▶ Good COP, Bad COP
icism, by continuing to allow its members to sit as their own The 28th UN Climate Change Conference wraps up in
judge and jury, a standing invitation for misconduct. As one Dubai on Dec. 12. Controversy around holding COP28 in a
example, the justices have long claimed that disclosure rules fossil fuel powerhouse intensified when it was leaked that
that Congress mandated in 1978 didn’t apply to valuable gifts the UAE planned to use the event to pitch oil and gas deals.
they received; such gamesmanship is likely to doom any new
self-policing system. ▶ The US Bureau of ▶ Germany’s Federal ▶ Egypt holds its
Labor Statistics reports Statistical Office reports presidential election
Because the court has refused to take enforcement seri- unemployment data for October’s trade balance Dec. 10-12. Incumbent
ously, Congress should do so. The Constitution provides November on Dec. 8. on Dec. 4. Germany’s Abdel Fattah el-Sisi,
Analysts don’t expect surplus in September who came to power
lawmakers with broad latitude in regulating the judicial joblessness to change shrank by €1 billion from after a 2013 coup, seeks
branch, and the legislature has a long history of imposing from the 3.9% reported the previous month, to to extend his rule for
in October. €16.7 billion. another six years.
requirements on the high court, including mandating recus-
als in cases where justices’ impartiality could be questioned
ILLUSTRATION BY YUKI MURAYAMA

and requiring disclosure of their financial holdings and ▶ The Reserve Bank of ▶ Figure skating’s ▶ Yorgos Lanthimos’
Australia sets interest 2023-24 Grand Prix steampunk fantasy Poor
outside income. rates—currently 4.35%— and Junior Grand Prix Things opens on Dec. 8.
Their judicial decisions are not subject to review, so the on Dec. 5. Analysts, finals begin on Dec. 7 in The hypersaturated
expecting inflation there Beijing. Medals will be mashup of Fifty Shades
justices seem to think their recusal decisions shouldn’t be, to fall further, to 3.5% awarded in men’s and of Grey and Frankenstein
either. There’s no constitutional basis for such a view, and no by yearend 2024, say women’s singles, pair may be the raciest
another hike is unlikely. skating and ice dance. Oscar bait of the year.
reason federal judges who review recusal judgments couldn’t
◼ REMARKS

A $30 Billion Reckoning

● America’s path to net-zero carbon ● By David R. Baker, Saijel Kishan

emissions is getting narrower and Jennifer A. Dlouhy
12

No one expected the transition from fossil fuels to be easy. But day. “We’re in the moment of realization now where some of
a year after President Joe Biden’s landmark climate law prom- the euphoria has worn off and we’re starting to realize it’s still
ised billions of dollars for America’s switch to clean energy, not going to be easy,” says Eric Scheriff, senior managing direc-
some of the nation’s most ambitious renewable power proj- tor at Capstone, a consulting company in Washington, DC.
ects have been shelved, electric car sales are missing targets The specter of bankruptcies now haunts the sector.
and investors are fleeing the sector in droves. The result is a Electric-bus maker Proterra Inc. filed for Chapter 11 protec-
$30 billion collapse in US clean energy stocks in the past six tion earlier this year, with solar financing company Sunlight
months—a market many investors expected to flourish in the Financial Holdings Inc. following soon after.
aftermath of the law’s passage. Deals are falling apart: Private equity-backed Ares
Few industries have been unscathed by soaring interest Acquisition Corp. abandoned its planned merger with nuclear
rates, but perhaps none has been harder hit than renewable power technology company X-Energy Reactor Co. in October.
energy. For a sector that builds big, expensive facilities such And projects have been canceled. Utility owner Avangrid Inc.
as solar plants and wind farms, high rates cut profit margins shelved wind projects in Connecticut and Massachusetts this
enough to sink projects and bankrupt companies. The giddy year, and NuScale Power Corp. abruptly terminated its plans
enthusiasm that followed the Inflation Reduction Act’s (IRA) for the first small modular reactor in the US—a technology
passage evaporated, wiping out a quarter of the market value regarded as key to the sector’s potential revival.
of US companies in the S&P Global Clean Energy Index in the For anyone who remembers the last cleantech bust more
six months ended on Nov. 27. than a decade ago, it’s easy to fear a repeat. “In the final anal-
It’s a meltdown that underscores the obstacles standing ysis, green investing has to be based on economic realities,”
in the way of Biden’s ambitious climate goals. Along with says Jerome Dodson, the now-retired founder of Parnassus
sky-high financing costs, clean energy companies face the Investments LLC, one of the world’s largest sustainable invest-
problems of winning over potential neighbors for their proj- ment companies, with $42 billion in assets. He sold his stake
ects, securing government permits and plugging into a creaky in the business in 2021—at the “top of the market,” as he puts
CATE DINGLEY/BLOOMBERG

power grid unable to handle all the renewable power that’s it—and predicts that wind and solar stocks could fall an addi-
planned. Oil and gas producers, meanwhile, are doubling tional 15% to 20% in the next six to eight months.
down on plans to keep pumping. It was only two years ago that Wall Street investors and
The warnings are clear: America’s road to achieving a bankers headed to Scotland for a global climate meeting, wax-
zero-carbon electricity grid by 2035 is getting rockier by the ing lyrical about net-zero emissions goals and the profits to be
◼ REMARKS Bloomberg Businessweek December 4, 2023

made from the shift to cleaner energy. That’s a stark c­ ontrast “Everything that’s invested in new exploration, new ­discovery,
to the current mood as the world convenes for another round new extraction, new burning, new internal combustion
of climate talks at the United Nations Conference of the engines, new fossil-fired electricity plants—all these long-life
Parties, or COP28, summit in Dubai from Nov. 30 to Dec. 12. assets—puts us much further away from any climate goals.”
American clean energy companies aren’t the only ones Nowhere are the problems facing clean energy more
struggling. China’s biggest solar and wind turbine manu- apparent than in the offshore wind industry. Biden’s climate
facturers recently reported shrinking profits. Danish wind plans call for building enough wind farms along the nation’s
developer Orsted A/S is fighting to recover from a $4 billion coasts in the next six years to generate 30 gigawatts of elec-
writedown stemming from two abandoned US wind projects. tricity, roughly the output of 30 nuclear reactors. But wind
In many ways, though, the problems are most surprising in developers have had their component costs rise as inflation
the US. Biden’s sweeping climate law offers at least $374 billion ripples through their supply chains. High interest rates com-
in tax credits and other incentives to spur the energy transi- pound the problem.
tion. Many saw it as a grand experiment to test whether sub- Over the next decade, surging costs threaten to add about
sidies, rather than top-down government mandates, would be $280 billion in capital expenditures for the global offshore
enough to accelerate a change the planet desperately needs. wind sector, according to researchers at consulting company
Instead, the US remains far off track for reaching EY. Both BNEF and S&P Global Commodity Insights have low-
Biden’s goal of a net-zero economy by 2050. Researchers at ered their projections on how much wind can be added to
BloombergNEF estimate the IRA will get the country only the grid by 2030.
halfway there, cutting annual greenhouse gas emissions from There are also hurdles in the switch to electric trans-
5.3 gigatons to 2.3 gigatons by midcentury. portation. Higher borrowing costs have made electric vehi-
Most analysts don’t expect clean energy’s current diffi- cles even more expensive, damping sales. Tesla Inc.’s stock
culties to completely derail the transition. But missing tar- price has tumbled about 20% from its 52-week high in July.
gets will still have major implications for the planet and the The com­panies that deploy EV chargers, such as Blink
global economy, as the extreme weather events that are pro- Charging Co. and ChargePoint Holdings Inc., are nearing
pelled and magnified by climate change continue to cause penny-stock status.
enormous damage. There are some bright spots, including large-scale solar. 13
The US is the biggest carbon emitter of all time, responsi- Panel costs have been dropping, which squeezes margins for
ble for about a quarter of historical greenhouse gases, and it equipment makers but can help increase the speed of instal-
holds the No. 2 spot for today’s levels. It’s also been consid- lations. Researchers at BNEF estimate that installed capacity
ered one of the biggest offenders in rich nations’ failure to jumped more than 50% this year to a new record. Funding
collectively marshal funds to the developing countries that for climate tech rose to the highest rate in almost two years
often experience climate change’s worst impacts. in the third quarter, according to BNEF. And BlackRock Inc.
Although Bank of America Corp. analysts estimate the CEO Larry Fink, who’s been a vocal proponent of embedding
global cost for confronting climate destruction will be roughly environmental objectives in investment decisions, is attend-
$75 trillion—or $2.7 trillion a year—between now and 2050, ing climate talks in Dubai after sitting them out last year, as
the price tag for inaction is much higher. Doing nothing to green investing faced backlash from Republican lawmakers.
address extreme heat, disasters and rising sea levels brings an “The trends remain in favor of clean energy, even if we’re
expense of $178 trillion, the analysts wrote in a recent report. seeing some minor growing pains at the moment,” says Sonia
“My nervousness is that we have high interest rates for a long Aggarwal, CEO of consulting company Energy Innovation,
time, and that slows the transition,” says Chat Reynders, who helped develop the IRA while serving as a special assis-
co-founder of Reynders, McVeigh Capital Management, which tant to President Biden.
oversees $3.5 billion in Boston. Nevertheless, even with federal support and expecta-
The International Energy Agency recently predicted for tions that interest rates will fall next year, big obstacles
the first time that global demand for oil will peak this decade, remain. Take, for example, the US grid. The energy transi-
but it also said that “an undulating plateau lasting for many tion requires vast changes to the interconnected networks
years” will follow, with emissions remaining too high to limit of generating plants, transmission lines and substations that
global warming to 1.5C, a critical tipping point for averting make up the grid, which is still designed largely for fossil fuel
more extreme consequences of global warming. generation. And there’s a massive bottleneck when it comes
For its part, the Organization of the Petroleum Exporting to the process for approving additions of power to grids. In
Countries predicts oil demand will keep growing for decades. August more than 1,700GW of wind and solar power projects
Exxon Mobil Corp. and Chevron Corp. just spent more than were stuck in approval queues across the US, according to a
$110 billion combined on two megadeals to secure future oil federal estimate.
production. “The timeline we have to get to net-zero is quite “You need all of the ingredients to make the cake,”
short,” says Garvin Jabusch, chief investment officer at Green Capstone’s Scheriff says. “We gained a few ingredients we
Alpha Advisors LLC, which oversees about $400 million. needed with the IRA, but we’ve still got to get the others.” <BW>
Bloomberg Businessweek Month 00, 2023

B
U
S
I
N
E
S
14

S LVMH, Short of bench pin, and the jewelers place the rings there to
file them down. The bench pins of the more experi-

Luxury Artisans, enced jewelers are so worn that they almost look like
bits of driftwood. But some have just a few grooves,

Turns to the US a sign of the tenure of their owners: apprentices.

Two of the ringmakers at work in the jewelry
studio this day are among the eight trainees in
Tiffany’s two-year apprenticeship program. LVMH
Moët Hennessy Louis Vuitton SE and Tiffany have
● As demand grows, the parent
teamed up with New York’s Fashion Institute of
of Tiffany and Louis Vuitton Technology and Studio Jewelers, a trade school in
PHOTOGRAPHS BY ADRIENNE GRUNWALD FOR BLOOMBERG BUSINESSWEEK

trains apprentices in America Manhattan, to give the apprentices theoretical and

technical training. They also get practical experi-
ence working alongside seasoned Tiffany jewelers.
On a recent afternoon at Tiffany & Co.’s jewelry Earlier this year, Tiffany started another program for
­studio in New York, a dozen or so jewelers filed seven more apprentices, who are taking classes at
down gold engagement rings while a tiny vacuum the Rhode Island School of Design. The jeweler pays
installed at each workstation sucked up the gold dust the trainees’ salaries while they’re in the program,
to melt it down and recycle it. It’s a slow, meticulous and if they master the skills, they’ll have the oppor-
task, in many ways little different from the process tunity to remain at Tiffany and craft luxury jewelry.
artisans have followed for hundreds of years. “We are teaching the next generation of crafts-
At each station there’s a small wood block, with people how important the details are,” says Dana
Edited by
a V-shape carved out in the middle, that’s attached Naberezny, chief innovation officer of jewelry at
James E. Ellis to the worktable just below eye level. It’s called a Tiffany and head of its workshop in Manhattan, as
◼ BUSINESS Bloomberg Businessweek December 4, 2023

The craftsmanship is part of what underpins the

items’ lofty prices and the company’s marketing
pitch that it’s honoring the heritage of its brands,
some founded more than a century ago.
Despite a recent slowdown in the pace of sales at
LVMH and other luxury brands, demand for high-
end goods is much more robust than it was before
the pandemic. That’s colliding with a decades-
long decline in the number of people who know
how to solder and set high-end jewelry, seamlessly
stitch handbags that cost more than most peo-
ple’s monthly rent or assemble leather shoes from
scratch. With each generation, more workers in the
US and Europe have been turning away from this
type of manual work, instead preferring positions
tied to what’s known as the knowledge economy.
LVMH is trying to address its worker short-
age by ramping up hands-on training, with the
goal of boosting the careers of thousands of arti-
sans in the coming years. “People aren’t trained,”
says Alexandre Boquel, who’s in Paris and runs
LVMH’s apprenticeship program, known as Métiers
d’Excellence. “We need to find them and train them.”
◀ An instructor with
an apprentice at the
Tiffany & Co. Jewelry
Design and Innovation
Workshop in New York;
15
jewelry in production at
the shop

she walks among the workbenches and shows off

a hanging display of hammerlike tools, including
one used by the grandfather of one of the jewelers.
Training the next generation of luxe artisans
has become a critical mission for Tiffany’s parent,
LVMH, the French conglomerate that also owns
Louis Vuitton, Christian Dior and six dozen other
brands. The world’s largest luxury company is fac-
ing a worker shortage that threatens to curb its pro-
duction of sought-after handbags, shoes and jewelry,
underscoring the broader industry’s challenge to bal-
ance strong demand for high-end, handmade goods
with fading interest in craftsmanship as a career.
LVMH is forecasting that it will have a deficit of
22,000 workers by the end of 2025, a record shortfall.
About two-thirds of those positions must be filled by
salespeople at LVMH’s upscale stores and employees
at its hotels around the world. The remaining third
are craftspeople and designers—a smaller figure, The goal of the apprenticeships, Boquel says,
but one that in many ways is more crucial for the is to “perpetuate the savoir-faire of the group.” If
company to address. Much of the appeal of LVMH’s he and his colleagues aren’t successful at creating
most coveted items—a Tiffany engagement ring, a a pipeline of skilled workers for the conglomerate,
Loewe leather purse, a Hublot watch or a Loro Piana then they won’t be able to “sustain the current lev-
sweater—is that they’re at least partially handmade. els of growth,” he adds.
◼ BUSINESS Bloomberg Businessweek December 4, 2023

The difficulty in hiring skilled craftspeople is executives in the luxury industry. The French giant
already hindering the pace of growth at other lux- is training 700 apprentices this year, up from 180 in
ury companies. “We’re looking desperately to hire 2018, and it aims to have even more next year.
people,” says Marco Angeloni, chief executive offi- One-third of LVMH’s new apprentices are
cer of suitmaker Raffaele Caruso SpA. “It’s been my “reskilling,” meaning learning new skills that are
No. 1 headache for the past year.” loosely tied to their current profession, such as a
Caruso is in Parma, Italy, and turns out men’s
suits that can retail for as much as $5,000 each for
some of the world’s top luxury brands. The suits,
which the company also sells wholesale, take
employees about nine hours to create by hand.
The pandemic exacerbated the worker shortage,
Angeloni says, because many companies in Italy and
elsewhere temporarily shut down or scaled back
their production, sending many senior craftspeo-
ple into early retirement and forcing junior employ-
ees into other industries. Small factories, unable to
survive, shut down completely.
During Covid-19, “formal wear seemed doomed—
everyone thought the jacket was dead,” Angeloni
says. Then demand surged as the pandemic receded.
By then, Caruso employed fewer workers, and
Angeloni couldn’t outsource some of his production
as he usually did; so many small factories were gone product leader in marketing training to become a ▲ Tommy Cornielle
Rodriguez, one of the
or had been bought by major luxury brands eager to jeweler. Before the pandemic, that figure stood at craftspeople at the
16 guarantee their own source of production. “When around 10%. Boquel attributes the jump to a desire Tiffany workshop

demand came back, people weren’t as excited to that arose in France and elsewhere during the pan-
come back to work as we were expecting,” he says. demic to diminish the grip the digital world has on
“Many had changed their lifestyles or industry.” our life. “A lot of people in France have been think-
Angeloni has added 45 workers to Caruso’s staff ing that ‘I need to get back to something very tac-
of 450 since the beginning of the year, including two tile, to do something with my hands,’ ” he says. “It
senior people he asked to come out of retirement was surprising to see how many 40- to 45-year-olds
to train newcomers. But it’s not enough. If the com- were contacting us to find a profession as a jeweler.”
pany had adequate staff, Angeloni estimates, sales Part of Boquel’s work is getting the word out
could have increased by 70% this year versus last. about the breadth of jobs available at LVMH and its
Instead, they will increase by 30%. “Opportunities 75 brands. He organizes workshops at high schools

PHOTOGRAPH BY ADRIENNE GRUNWALD FOR BLOOMBERG BUSINESSWEEK. DATA: AMDA, WITH DATA FROM INEGI
have been lost,” he says, “for us and the brands.” in France and the US, for example, to introduce
Nicolas Girotto, CEO of Swiss luxury shoe com- young people to the opportunities.
pany Bally, says he constantly has about 5 to 10 “People don’t know 1% of these professions,”
vacancies for artisans. “The long-term trend for lux- Boquel says. LVMH has 280 careers, he says, includ-
ury overall is constant growth,” he says. Because ing calligraphers for Hennessy’s cognac barrels and
hiring isn’t keeping pace, Girotto says, he’s focus- artisans at Berluti who sculpt shoe molds known as
ing on having each of his company’s artisans learn lasts from a block of hornbeam wood using a knife-
several steps in the shoemaking process instead of like tool called a paroir. These artisans then file
specializing in one—a break with tradition. and smooth down the mold with a rasp, followed
As many as 250 separate steps are required by sandpaper—a process that, according to Berluti’s
to craft Bally’s highest-end shoes. About 20% of website, emphasizes “the elegant line of the shoe.” A
the 100 or so artisans in Bally’s atelier in Lugano, pair of the brand’s Oxfords retails for about $2,500.
Switzerland, have been trained in more than one Most of LVMH’s current crop of trainees are
task. “The more skills they have, the better for the in France, Italy and Switzerland, and the com-
company and the better for themselves,” he says. pany is expanding into other countries, including
LVMH’s apprenticeship strategy—start piquing the US, where it plans to initiate more appren-
the interest of potential trainees as students, and ticeships in addition to the two Tiffany pro-
expand the program to include more jobs and geog- grams. Apprenticeships are a traditional—and still
raphies over time—will be closely watched by other ­common—way to train workers in countries such
◼ BUSINESS Bloomberg Businessweek December 4, 2023

as France, Germany and Switzerland, but they’re interior with HD touchscreen, he was impressed
far less prevalent in the US, says Robert Lerman, with what the vehicle offered for its price. Plus it
who’s researched apprenticeships for three decades had a five-year warranty.
as a fellow at the Urban Institute, a think tank in “In general, all Chinese brands offer greater
Washington. France under President Emmanuel technology at a lower cost,” he says, standing in
Macron spends billions each year to successfully front of his new JAC Motors truck. It was his sec-
expand apprenticeships, yet the US invests only ond Chinese vehicle; he’d snapped up a truck from
about $300 million annually, Lerman says. MG Motor, owned by Chinese carmaker SAIC Motor
Most apprenticeships in the US focus on train- Corp., a few months earlier.
ing construction workers, electricians and plumb- Robledo is among the growing ranks of first-time
ers. If LVMH’s rollout is successful, “it would be a owners of Chinese-made vehicles in Mexico. Last ▼ Car sales in Mexico
by country of origin,
great example to other firms in that industry,” he year the country was the No. 1 importer of Chinese through October of
says. “It’s learning by doing. You can’t create jew- models, and so far in 2023 it trails only Russia, each year

elry just from a classroom.” according to data from the China Association of China

In France, it’s relatively straightforward to begin Automobile Manufacturers. Chinese cars accounted Brazil

an apprenticeship program compared with the US. for almost 20% of all car sales in Mexico through US

An apprenticeship tax on companies finances the October, and they’re selling faster than those man- India

cost to train apprentices, and employers pay train- ufactured in any other country, including Mexico. Japan

ees’ wages. And there’s a plethora of schools tied to Chinese car sales in Mexico rose 51% in the first
the fashion industry, making it easier for LVMH to set 10 months of the year, with 212,169 sold, data from 200k

up training programs and contact potential appren- the Mexican Association of Automotive Distributors
tices. In the US, though, “we had to build something shows. Every other foreign country is selling less
completely from scratch, inspired by France’s con- than half that to Mexican consumers. Almost all of
cept,” Boquel says. �Jeannette Neumann these vehicles are gas-powered, but the trend gives
China a coveted foothold in North America as it 100
THE BOTTOM LINE Luxury giant LVMH is expanding its
apprenticeship programs to satisfy growing demand for high-end
battles the US for supremacy in automotive sales. 17
goods amid fading interest in craftsmanship as a career. Cars imported from China were practically
impossible to find in Mexico until about 2016,
when they still made up only a tiny fraction of
total sales. Now buyers have a half-dozen brands 0

to choose from in Mexico City and other large

Chinese
20052023
metro­politan areas. Chirey, the Mexican arm of
Chery Automobile Co. in Wuhu, started selling cars
in Mexico just last year, and the parent’s Omoda

Cars Steer brand followed suit this year. Shoppers can even
browse BYD Auto Co. models in some Liverpool
department stores across Mexico.

Into Mexico That the vehicles tend to be cheaper is “very

important to Mexicans,” says David Barrera, direc-
tor of business development in Monterrey for
Banco BASE SA, whose clients include Chinese auto
● They’ve become the biggest-selling imports parts companies and vehicle manufacturers. “They
there, thanks to tech features and cheap prices don’t have as much access to credit as p ­ eople do
in the US.”
In addition, China has focused on improving
When Jorge Ramírez Robledo went to buy a new manufacturing quality, and its models are consid-
pickup in October, he encountered an enticing ered to have more advanced technology for the
option from a little-known brand in a Mexico City price, says Carlos Alvarado, vice president and stra-
dealership: the JAC Frison T8. At 468,000 pesos tegic adviser for Grupo Prodensa, a consulting firm
($27,317), the offering from China’s Anhui Jianghuai in Monterrey for foreign investors in manufactur-
Automobile Group Co. costs about $10,000 less ing. “It no longer scares us that the product is made
than similar trucks from Chevrolet, Ford Motor in China,” he says. “Every other high-tech product
and Toyota Motor. is made in China, like iPhones.”
After inspecting under the hood of a bright Two major forces colliding at exactly the right
blue model and peeking inside its spacious leather time gave China an opening in Mexico. Chinese
◼ BUSINESS Bloomberg Businessweek December 4, 2023

consumers’ big shift toward electric vehicles of US incentives. By building the parts there, the
has left the country’s manufacturers with leftover Chinese company evades Trump-era tariffs of as
gas-powered ones to sell abroad. And supply chain much as 25%, says Scott Chen, chief executive offi-
issues stemming from Covid-19 snarled production cer of Yinlun TDI LLC, the California-based sub-
of other brands’ cars and sent prices soaring, allow- sidiary of the Chinese manufacturer. Chen told
ing China’s Chirey, JAC, SAIC Motor and others to Bloomberg Businessweek that the company is also ● The maximum US
tariff Chinese auto parts
swoop in with more affordable options. considering a third Mexican plant in Nuevo Leon. companies can avoid by
Chinese entrants may have a hard time keep- Hybrid and electric vehicles are still somewhat building parts in Mexico

ing up momentum as rivals’ inventories recover.

Stellantis, Nissan Motor and Volkswagen have all
scarce in Mexico, because of their high cost and
the country’s relatively incomplete charging infra- 25%
seen spikes in sales during a post-pandemic auto structure, but China is becoming dominant in the
boom in Mexico, with light-vehicle sales surging nascent market. The share of EV and hybrid sales in
25% in the first 10 months of the year. And US auto- Mexico has risen from 0.5% in 2016 to 5.5% through
makers are building out their Mexican presence to August this year, with most of the vehicles coming
take advantage of President Joe Biden’s tax cred- from China, according to the Mexican Automotive
its for North American-made EVs. Ford, General Industry Association. “Chinese companies were
Motors and Stellantis have each announced plans able to deliver in less time and with better prices,”
to expand production in the country, and Tesla Inc. says Francisco Cabeza, president of the Mexican
is building a megafactory in Nuevo Leon. Association to Promote Electric Vehicles.
“It’s possible that more North American vehi- Thousands of electric taxis and public buses
cles will quickly begin to enter the Mexican mar- labeled with the government-created slogan “Soy
ket and displace Chinese competition,” says Jesús Eléctrico” (“I’m electric”) zip around the smoggy
Carrillo, director of sustainable economics at the streets of Mexico City. The taxis from Vemo, a
Mexico Institute for Competitiveness, a think tank. Mexican clean mobility startup, are from BYD and
Chinese carmakers are looking to Mexico to JAC; the city-owned buses and trolleys are from
18 expand their footprint in other ways, too. JAC has Chinese companies Zhengzhou Yutong Bus Co. and
announced expansion plans for its assembly plant Zhongtong Bus.
in Hidalgo, a joint venture with Mexican billion-
aire Carlos Slim’s Giant Motors. MG Motor is look-
ing to expand its parts distribution center in San
Luis Potosí. A half-dozen other Chinese car com-
panies have also in recent years expressed interest
in opening manufacturing plants for both EVs and ◀ An Anhui Jianghuai
Automobile electric
gas-powered vehicles. car at its dealership in
Although companies from China have yet to Mexico City

export vehicles from Mexico to the US, parts

makers are already doing so. Zhejiang Yinlun
Machinery Co., a Chinese supplier of cooling sys-
tems for cars and heavy machinery, opened in
Nuevo Leon earlier this year and produces parts Mexican shoppers can expect to see more
for GM, Volvo and Tesla, among others. Chinese EVs for sale next year. This summer, BYD
“Our US customers are very excited that we formed a partnership with retailer Liverpool to sell
have a factory here in Mexico, because of the issues its EVs and add charging stations at its ubiquitous
between the US and China, and also because of the stores. The company has also sold electric-truck
distance—since Mexico is much closer to the US,” fleets to major Mexican conglomerates including
says Dava Chou, project director of Yinlun Mexico, Bimbo, Cemex, Lala and Coca-Cola Femsa, the
speaking over the whir of factory equipment at the Mexican conglomerate’s bottling operation.
Nuevo Leon factory. The plant is only two hours Stella Li, BYD’s Americas CEO, says the Warren
from the US-Mexico border. Buffett-backed Chinese EV giant has more partner­
Yinlun plans to almost double its workforce with ships in its sights, too. “We are looking to bring
MARICEU ETHRALL/BLOOMBERG

the opening of a second facility outside Monterrey Mexico’s auto industry to the next level,” she says.
in Hofusan Industrial Park, where all the tenants “We have big plans.” �Amy Stillman
are Chinese. The company is looking to source the
THE BOTTOM LINE Vehicles manufactured in China accounted
bulk of its materials from North America—today, for almost 20% of all new cars sold in Mexico in the first 10 months
about 80% come from China—to take advantage of 2023. The country trails only Russia in sales of Chinese autos.
Bloomberg Businessweek December 4, 2023

T What’s Next, Sam?

E
C
H
N
O
L
20

O
G
Y

Edited by
Joshua Brustein
◼ TECHNOLOGY Bloomberg Businessweek December 4, 2023

revelations of tensions within OpenAI over his ▼ The Board

● OpenAI’s CEO returns with
fundraising for an outside chip venture, including Newcomers
near-unanimous support but seeking funding in the Middle East, and a dispute
some tricky issues to resolve with former board member Helen Toner over a
research paper she’d co-written that was critical of
the company. It was Altman’s pattern of behavior,
Sam Altman has shown the world that he’s not to rather than a single egregious action, that caused
be messed with. the board to lose trust in him, according to a per-
Within four days of losing his job as chief exec- son with direct knowledge of the board’s think-
utive officer of OpenAI in a surprise boardroom ing, who asked not to be named discussing private
coup, the 38-year-old artificial intelligence ­phenom business matters. Larry Summers
won back his position, aided by the support of In the wake of Altman’s firing, former OpenAI Summers, former US
730 employees—out of the company’s 770-­person employee Geoffrey Irving publicly accused Altman Treasury Secretary and
former chief economist
workforce—who threatened to quit if the board of lying to him on several occasions when he of the World Bank, is a
didn’t bring back Altman. worked at the company, but he didn’t give spe- professor and president
emeritus at Harvard
Anyone who’s ever had a job knows that such cifics. Irving didn’t respond to a request for com- University. He has said
overwhelming support for the boss is unusual. “It’s ment. Altman’s past has received new scrutiny, as AI will have serious
negative impacts on
a huge testament to the kind of CEO he is,” says well. His longtime mentor, Paul Graham, fired him labor and has warned of
Alfred Lin, an investor at Sequoia Capital, which from his position as president of startup incubator economic catastrophe
if the US “loses its lead”
invested both in OpenAI and Altman’s first startup, Y Combinator four years ago for putting his own in biotechnology and
Loopt. “There are always going to be detractors. interests ahead of the organization, according to AI to China. (Summers
is a paid contributor to
But the fact that he got to around 95% of employees a person with knowledge of the matter who asked Bloomberg Television.)
signing the statement is pretty remarkable.” not to be named for fear of professional retaliation,
In some ways, Altman has come out of the epi- confirming a report in the Washington Post.
sode stronger than ever, but the struggle isn’t quite In an internal memo the day after Altman’s fir-
over. Altman didn’t get back his board seat, and nei- ing, OpenAI Chief Operating Officer Brad Lightcap 21
ther did a key ally, co-founder and former OpenAI said the board’s decision wasn’t a “response to mal-
President Greg Brockman, who was kicked off feasance” but came because of a “breakdown in
the board and quit his position in protest shortly communication between Sam and the board.” The
after Altman’s firing. One of the people who fired company declined to comment further.
Altman, Quora CEO Adam D’Angelo, remains. People who know and support Altman say he
There have already been discussions among often argues both sides of a debate, which they Bret Taylor
investors about changing OpenAI’s complex gov- see as a useful way of exploring ideas but could Taylor, the incoming
ernance model, according to sources. Any changes be misinterpreted as making false promises or chairman, is a prominent
CLOCKWISE FROM LEFT: CHRIS J. RATCLIFFE/BLOOMBERG. STEFAN WERMUTH/BLOOMBERG. NATHAN LAINE/BLOOMBERG

leader in Silicon Valley

in the structure of the company and its board over ­confusing people. “Sam uses words fairly precisely who recently stepped
the next few months could determine a lot about in my experience. If he tells you what he plans down as co-CEO at
Salesforce. Previously,
Altman’s power within OpenAI over the long term. to do, that’s what he plans to do. If he tells you he co-created Google
Prior to Altman’s firing, OpenAI was considered he agrees with you in principle, he does. These Maps, served as CTO at
Facebook and founded
a stable company, beating the biggest tech giants are different things from each other. Not every- productivity app Quip.
in the race to develop AI, with Altman cast as its one groks this,” wrote OpenAI researcher Joshua Taylor has experience
acting as a board chair
charismatic, savvy leader. Altman is still a widely Achiam, on X. in times of transition,
respected figure who came out on top of an ill-­ Immediately after being fired, Altman resigned which he did at Twitter
prior to its acquisition by
advised coup, but he’ll likely continue to face ques- himself to moving on and starting a new company, Elon Musk.
tions about his rift with the board and his business according to a person familiar with the matter who
dealings more broadly. “We’re just now seeing the asked not to be named discussing private matters.
whole, complicated, Sam Altman,” says tech histo- Soon after, Brockman and other key employees
rian Margaret O’Mara. “Part of this is the reality-­ began resigning and voicing their support for
check phase of a Silicon Valley leader.” Altman. By Saturday morning, Altman reconsid-
To regain his job, Altman agreed to an internal ered after members of the board called him asking
investigation, among other conditions. The abrupt if he would consider returning, the person says.
nature of his firing and a statement from the board OpenAI’s main financial backer, Microsoft Corp.,
saying that Altman hadn’t been “consistently can- gave employees leverage by offering to hire them
did” in his communications set up expectations if they followed through with their threats to quit.
for the emergence of a smoking gun. Nothing In part, the employee reaction makes sense in
like that has come out, though there have been simple financial terms. Many OpenAI employees
◼ TECHNOLOGY Bloomberg Businessweek December 4, 2023

hold equity in the startup, which was recently “It’s really hard to not get wrapped up in that.”
valued at $86 billion dollars in a planned t­ ender Altman has said he has no equity in OpenAI, a
offer that would give staff a chance to cash out. rarity for startup founders. “How many people do
With Altman no longer CEO, some investors you know who would do that?” says Vinod Khosla,
were considering backing out of the deal, giv- an early OpenAI investor. “He’s very mission-­
ing employees direct financial motivation to urge focused … and he’s proven that beyond a shadow
Altman’s return. of doubt.”
But Altman’s supporters say he’s built credi- This is particularly notable given the reputa-
bility among employees by listening to their per- tion Altman built in his years at Y Combinator as a
spectives, particularly regarding the company’s savvy dealmaker and Silicon Valley superconnec-
stated values. OpenAI’s mission is to create artifi- tor. In the AI frenzy that followed ChatGPT’s intro-
cial general intelligence—AI systems that are gen- duction in November 2022, Altman has turned his
erally smarter than human beings—in a way that charm on world leaders, regulators and the press.
benefits humanity. Achiam praised Altman for Businesspeople often advocate for their industries
the way he handled internal dissent. “I remem- on the public stage. But Altman has cultivated
ber telling Sam in 2020—in front of other people, an image as someone who not only articulates
at a company office hours—that I thought releas- the benefits of AI development but is also clear-
ing something was a terrible idea,” Achiam wrote eyed about its potential dangers. The OpenAI flap
on X. “A normal CEO would (should) have fired has added a wrinkle to that story, but he retains
me. Instead, Sam took me seriously and asked for a ­sizable fan base in Silicon Valley. “Altman has
my advice.” been embodying a kind of idealism for a lot of peo-
Many employees take this mandate seriously. ple,” O’Mara says, “even though he’s always been
“We have a common mission to basically ‘Build a c­ apitalist.” �Shirin Ghaffary, with Rachel Metz,
God,’ safely, and for the benefit of all humanity—­ Lizette Chapman and Sarah McBride
and have a charismatic leader guiding us
THE BOTTOM LINE An unsuccessful attempt to remove Sam
22 there,” says an OpenAI employee, who requested Altman may have bolstered his reputation, but could yet have
anonymity to protect professional relationships. structural impact on the company he runs.

BLOOMBERG (3). GETTY IMAGES (4). *INVESTMENT WAS MADE IN 2021 BUT THE MONTH IS UNKNOWN. DATA: PITCHBOOK AS OF 11/28, BLOOMBERG REPORTING
The Pre-Coup Board
OpenAI is overhauling its board, with only one of its six
members staying on as the company moves forward

Sam Altman Greg Brockman Adam D’Angelo Tasha McCauley Ilya Sutskever Helen Toner
Altman was fired Brockman is a D’Angelo is the McCauley is an Sutskever, a well- Toner is an academic
from his job as chief co-founder and former co-founder and CEO entrepreneur and a respected researcher who heads strategy and
executive officer and president of OpenAI. of Quora, the online robotics engineer. whose work has focused foundational research
removed from OpenAI’s He was removed from Q&A service. An early She’s an adjunct on neural networks, is a grants at Georgetown
board on Nov. 17, with his role as chairman of Facebook executive, senior management co-founder of OpenAI, University’s Center for
board members alleging OpenAI’s board when he’s also the founder scientist at the Rand its chief scientist and a Security & Emerging
that he wasn’t being Altman was fired. He of Poe, a platform that Corp., according to key player of the coup Technology. Before
“consistently candid in then resigned his job, allows people to ask her LinkedIn profile. to remove Altman. joining CSET, she lived
his communications.” posting a note online questions from various McCauley serves on Sutskever, who’s clashed in Beijing, studying the
Although he was quickly saying, “based on AI chatbots. D’Angelo, the boards of effective with Altman over how Chinese AI ecosystem.
reinstated as CEO after today’s news, I quit.” who agreed to Altman’s altruist organizations quickly to develop AI, Altman and Toner
a wave of employee Staff pressed the board ouster, is the only Effective Ventures later wrote that he had a dispute over a
protest, he isn’t, for now, for Brockman’s return board member who’s and 80,000 Hours. “deeply” regretted research paper she
returning to the board. along with Altman. staying on. She agreed to helping oust Altman recently published
He’s since rejoined the Altman’s ouster. and said he would do that was critical of
company and has been “everything I can to OpenAI. She agreed to
posting cheerful selfies reunite the company.” remove Altman.
with employees.
◼ TECHNOLOGY Bloomberg Businessweek December 4, 2023

tech to its corporate customers, and it held an

Microsoft Is
▼ Largest AI investments
by big tech companies
expansive license to use the startup’s AI models. and their VC arms
Microsoft’s Azure cloud computing division also
Just the Copilot built and houses the supercomputer OpenAI uses
● Alphabet
● Amazon
to train its models. Microsoft had everything it ● Apple
needed, in other words, to quickly spin up a cred- ● Meta
● The tech giant navigates its unusual ible OpenAI clone if things went sideways. ● Microsoft
relationship with OpenAI Nadella used his leverage soon after Altman’s ● Nvidia
­firing, announcing that Microsoft had hired Altman
and former OpenAI President Greg Brockman to 2014

Until Nov. 17 the conventional wisdom in Silicon start an AI division within the company—and
Valley was that Microsoft Corp.’s partnership with would also hire any OpenAI engineers who chose $1.2b
OpenAI was an enviable success. The investment to defect. This made every OpenAI employee a
boosted Microsoft’s cloud computing business, flight risk and helped bring on the mass resigna-
gave it access to OpenAI’s best technology, reinvig- tion threat that led to Altman’s reinstatement.
orated its Bing search engine and helped stream- The result allows Microsoft to more or less go
line its artificial intelligence research effort. And $1.0b
● Nadella (right)
because Microsoft owned less than 50% of OpenAI’s and Altman
equity, the company avoided the sort of antitrust 2016

scrutiny that has followed it since the 1990s.

But one of the drawbacks of outsourcing key
technology to a startup—even one that many peo-
ple regard as a de facto subsidiary—is that it can
blow itself up without so much as a friendly warn-
ing. Microsoft found out about the ouster of OpenAI
Chief Executive Officer Sam Altman only minutes 23
before the public did, sending executives scram-
bling and shares sinking. Soon enough, Microsoft 2018

CEO Satya Nadella and his deputies helped engi-

neer a dramatic countercoup, restoring Altman
to his job and securing the ouster of the board back to business as usual: aggressively adding AI
members who were least aligned with Microsoft’s assistants, which Microsoft calls Copilots, to all its
interests. “He was playing three-dimensional con- software offerings. These AI assistants don’t come
sultative chess,” says Sheila Gulati, a longtime cheap. Any business that wants one for Word and
Microsoft manager who’s now a managing direc- Excel, for example, will pay an additional $30 per
tor at Tola Capital, a venture capital firm. user per month, roughly doubling what a typi-
The coup and the quick reversal underscore cal corporate customer pays for Microsoft’s office 2020

why Microsoft’s lead over its primary rivals in AI suite. At the same time, free and open-source AI
remains uncertain. OpenAI’s newly reconstituted assistants are widely available. Microsoft is bank- $3.0b

board is planning an investigation into Altman, ing on customers being willing to pay for the
$2.0b*
which could reignite the controversy around him. productivity gains from Copilot and the conve-
At the same time, Google, Facebook, Anthropic and nience of having it baked into such a wide array $1.0b
other competitors appear to be catching up. of software.
$2.5b
When it put its first billion into OpenAI in 2019, “It’s going to show up across all your experi-
Microsoft didn’t receive the protections that out- ences,” says Rajesh Jha, the executive vice presi-
side investors usually get. The startup’s for-profit dent who oversees the product teams for the office 2022

arm sat inside a nonprofit that was ostensibly ded- suite, Windows and search. Microsoft, he contin-
icated to advancing AI software while protecting ues, wants to “be the Copilot company.” In a way,
humanity from any danger should AI development the product name is apt. Microsoft is betting its
get out of control. It had no fiduciary duty to pro- future on an uncertain technology, even though
tect Microsoft’s interests, and could ignore the it’s not clear who—Nadella or OpenAI’s board—has $10b in OpenAI

company’s wishes in a disagreement over AI safety. the controls. �Max Chafkin and Dina Bass
$1.3b $1.3b
But this understates the leverage Microsoft had
THE BOTTOM LINE OpenAI can seem like a de facto Microsoft
in any potential dispute. As OpenAI’s primary subsidiary, but the tech giant has less control over it than investors $4.0b $2.0b
investor, Microsoft had the right to resell OpenAI’s often have over the startups in their portfolios.
Bloomberg Businessweek December 4, 2023

F Bashing
I
N
A
N
C
E
24

Wall Street is amping up efforts to convince Americans

they should care about arcane global banking rules

In recent weeks dozens of entrepreneurs have The ground rules of global banking don’t ­typically
ILLUSTRATION BY MICHAEL DEFORGE. DATA: BLOOMBERG INTELLIGENCE

paraded through the US Capitol, carrying signs get people outside of a few boardrooms in New York,
reading “Stop the Squeeze on Small Businesses” London and Zurich particularly fired up. But as the
and knocking on the doors of their representatives financial world debates US p ­ roposals tied to what’s
and senators. Regulations under consideration, called the Basel III Endgame­­­­­—an international over-
they insist, will cut into profits at consignment haul initiated more than a decade ago in response
stores, pizza parlors, auto body shops and more. to the financial crisis of 2008­—­Wall Street lobbyists
“This proposal will increase borrowing costs,” Dina are in overdrive and seeking to drag US public opin-
Akel, the owner of a New Hampshire bridal bou- ion along with them.
tique, wrote on LinkedIn, making it harder “for The debate will take center stage on Dec. 6,
Edited by small businesses to secure essential funding to hire when the chief executive officers of Wall Street
David Rocks,
Jenny Surane
more workers, and for farmers to take out loans for titans including Goldman Sachs Group, JPMorgan
and Jeff Black next year’s crops.” Chase & Co. and Morgan Stanley are set to appear
◼ FINANCE Bloomberg Businessweek December 4, 2023

One group ran a spot during

an NFL game, while the finan-
cial press is brimming with
ads proclaiming the dam-
age the proposals will do. And
Goldman Sachs has been p ­ eppering
­participants in a small-­business pro-
gram it runs with emails urg-
ing them to help fight the rules.
Many, including bridal shop
owner Akel and others flocking
to the Capitol in recent weeks,
have heeded the call.
At the heart of the debate is what’s
known as the capital ratio: a number
dictating how much money banks have to
hold as a cushion to absorb unexpected losses.
There’s general agreement that higher capital
requirements would reduce banks’ profits from
making loans, but regulators say it’s uncer-
tain whether they will meaningfully
raise interest rates for individual
borrowers. One thing is clear: Wall
Street is focusing on the potential
for a reduction of credit to small busi-
nesses and homeowners because 25
that’s far more likely to interest
Washington policymakers than
the most direct initial impact of
the p­ roposal—an effective cap on
lenders’ ability to buy back shares.
The banks’ ultimate goal is to kill or signifi-
cantly reshape the 1,087-page proposal that the
Fed, the Federal Deposit Insurance Corp. and the ▼ Excess capital at risk
from new regulation
Office of the Comptroller of the Currency unveiled
in July. Short of that, they want to delay imple-
at a Senate hearing on banking ­oversight. mentation. Already, regulators have extended the JPMorgan Chase

They’ll seek to convince lawmakers that the new deadline for comments to mid-­January from the $40b

rules are unnecessary and will hurt the economy. end of November, and lenders and trade groups Bank of America

“What I would love to know is what they really want have started compiling dossiers of objections that 31

to accomplish,” JPMorgan Chief Executive Officer stretch beyond 100 pages, according to a person Wells Fargo

Jamie Dimon told investors in September. “If they familiar with the matter who asked not to be iden- 26

want banks never to fail, this isn’t going to do it.” tified discussing private deliberations. If that fails, Citigroup

If approved by US watchdogs, the rules would they’re considering legal action against the reg- 15

require big banks to increase their capital cushion ulators, according to others. “It is pretty rare to Goldman Sachs

by ­almost 20% to ensure they can survive another see the large US banks stake out such a strong 12

crunch. The Federal Reserve and other r­ egulators stance in the media against their prudential regu- Morgan Stanley

say the changes can help avoid turmoil such as lators,” says Randy Benjenk, a partner at law firm 12

this year’s meltdowns of midsize banks. Bankers Covington & Burling. “This proposal crosses a red BNY Mellon

note that under various rules implemented in line for them.” 5

recent years they must already hold twice as much Michael Barr, the Fed’s vice chair for supervi- State Street

in reserve as they did before the financial crisis. sion, has spent recent months arguing that banks 4

They’re now sitting on $145 billion in excess capi- do, in fact, need to continue bolstering their cap-
tal, which would be wiped out—and then some—by ital positions, given the damage wrought by the
the new rules, according to Bloomberg Intelligence. ­financial crisis: Six million families lost their
◼ FINANCE Bloomberg Businessweek December 4, 2023

homes to foreclosure, and 10 million people fell subject to the same capital requirements as banks.
into poverty. And despite the additional capital Bank executives have been less vocal about how the
they must now hold, he adds, financial firms are rules will affect their vast trading and investment
still ­enormously profitable. He’s not wrong: The six banking operations—which is where they’ll likely
biggest US banks have racked up $1 trillion in earn- feel a far greater impact, according to the regula-
ings over the past decade. tors’ proposal.
As they’ve sought to make their case against And then there’s Wells Fargo & Co. Until
Basel, bank executives have focused on proposed recently, the firm was the biggest bank in home “If they want
changes to requirements for residential mortgages. lending. But even before the proposals, it had banks never to
The rules would raise the so-called risk weights for already started pulling back, and executives have fail, this isn’t
some home loans, including those with smaller little interest in jumping back into the field. So going to do it”
down payments, meaning banks would have to the rule changes would have scant effect on the
hold more money against those assets. bank’s mortgage strategy, says Kleber Santos,
But the titans of Wall Street rarely make the kind Wells Fargo’s CEO of consumer lending. “I don’t
of low down-payment loans that would be affected. think that particular decision by our regulators,
And in recent years, they’ve largely been edged if and when it comes,” Santos says, “will really
out of the US home loan business, with no bank change much on what we do in the home lend-
holding more than 3% of the market for originat- ing business.” �Hannah Levitt, Paige Smith and
ing mortgages, according to industry publication Katherine Griffiths
Inside Mortgage Finance. They’ve been unseated
THE BOTTOM LINE Regulators say requiring big banks to bolster
by nonbank lenders such as United Wholesale their capital will make the financial system more resilient, but
Mortgage LLC and Rocket Cos., which aren’t lenders insist it will stymie the creation of new loans.

The Ambitions of
26

Italy’s Money Machine

● Andrea Orcel has €10 billion in hand, and he’s ready to spend

A quarter-century ago, a young banker named region’s leader. “The dream is to respond to Henry
Andrea Orcel led a team at Merrill Lynch that cob- Kissinger’s question when he said, ‘If I want to talk
bled together more than a half-dozen midsize to Europe, whom do I call?’ ” Orcel told Bloomberg
banks to create Italy’s No. 3 financial firm. Over Television’s Francine Lacqua. “We would like to be
the following decade, the company now known part of that call.”
as UniCredit SpA spent $65 billion buying lend- Investors have cheered the 60-year-old Italian’s
ers across central and eastern Europe to become a efforts to scale back bureaucracy, close weak busi-
regional colossus—and Italy’s biggest bank. ness lines and shift resources to more p ­ rofitable
Orcel went on to take the top job at UBS endeavors. He’s supercharged UniCredit’s earn-
Group AG’s investment bank. Then came a court- ings and implemented the most generous stock
ship with Banco Santander SA, which ended in a buyback plan of any European bank, planning
court ruling that could net Orcel as much as €43 mil- to hand out at least €6.5 billion for 2023 via divi-
lion ($47 million) after the Spanish lender withdrew dends and share purchases. That’s helped almost
an offer for him to become chief executive officer. triple UniCredit’s share price, and today Orcel has
In April 2021, Orcel returned to UniCredit—­ €10 billion in funds available for targeted acquisi-
running the bank he helped create, aiming to tions or shareholder payouts beyond what’s already
transform a troubled conglomerate into the been promised. Along the way, he’s managed to
◼ FINANCE Bloomberg Businessweek December 4, 2023

27

win one of Europe’s biggest paychecks, with total that had lost confidence in itself, lost external ▲ Orcel in London
in November
­remuneration approaching €10 million a year. ­credibility,” Orcel says.
Orcel is confident UniCredit can continue to Despite his pedigree in investment banking,
thrive, but the next steps will be harder. Some of Orcel has yet to secure a major deal, even as some
its profit growth can be attributed to rising inter- outsiders push for a mega-acquisition that would
est rates, and that tailwind is likely to ease as the catapult UniCredit into the top echelon of global
European Central Bank scales back efforts to fight finance. Orcel in 2021 backed out of an agreement
inflation and customers demand greater interest to acquire the Italian government’s stake in Banca
on their savings. Despite the culling, he still pre- Monte dei Paschi di Siena SpA, but he says he’s
sides over an empire of smaller businesses across on the lookout for other purchases that might
central and eastern Europe. That’s left Orcel with a
hodgepodge of inherited computer systems, which
means further streamlining will be more compli- The Orcel Effect
cated than what he’s managed so far. And recession Change in stock price
looms in Germany, where UniCredit owns the for- UniCredit BBVA Santander BNP Paribas Deutsche Bank Société Général
mer HypoVereinsbank.
Orcel took the helm after a period of turmoil
that saw UniCredit become a byword for the frag- 150%

mentation that plagues European banking: lim-

ited profitability stemming from operations spread 100

across localized markets that make it hard to boost

efficiency. His predecessor, Jean-Pierre Mustier, 50
CARLOTTA CARDANA/BLOOMBERG

implemented a painful downsizing, raised some

€13 billion in fresh capital and offloaded piles of bad 0

debt. While that created a foundation for growth,

UniCredit lost its position as Italy’s leader to Intesa -50

Sanpaolo SpA, and after a clash with the board on 4/9/202111/24/2023

strategy, Mustier stepped down. “This was a bank DATA: BLOOMBERG
◼ FINANCE Bloomberg Businessweek December 4, 2023

further boost the bank’s valuation. Although commercial bank like UniCredit. “You can work
nothing so far has had sufficient appeal, he’s clearly anywhere,” he says, “but certain principles always
amenable to the idea of a landmark deal. “Europe remain the same.”
needs banks with market capitalizations ahead of Beyond job cuts and efficiency tweaks, the
$100 billion if we want this economic bloc to hold thrust of UniCredit’s strategic direction is to use
vis-à-vis the US or China,” he says. fee-­generating businesses (insurance, payments and
Orcel has shed almost 10,000 jobs—about 12% of asset management) as a second profit engine, bring-
the bank’s total workforce—particularly at its cor- ing more products in-house rather than subcontract-
porate centers in Milan and Munich, leaving some ing them to outsiders. “We need to grow in the right
staff uneasy, employees say. And his hard-charging places—where do we want to gain market share?” he
nature—he’s known for calling subordinates in the says. “This is not very dissimilar to what I did at UBS.
wee hours—isn’t to everyone’s taste. He’s direct and We piled on in equities, where we were strong, and
demanding, and he has an investment banker’s pulled back on fixed income, where we weren’t.”
readiness to keep everything in flux until a deal is Europe has long suffered from too many lend-
­finalized, deliberately fostering uncertainty, accord- ers competing for depositors and clients. But rules
ing to several former colleagues, who asked not to be over the management of capital and liquidity can
named speaking about personal matters. lower incentives for cross-border deals, a concern
But Orcel’s fans say his determination, coupled even for regulators who’ve sought, but failed, to
with a willingness to do the unexpected, make him create a true banking union. Orcel argues that his
a natural leader. While cutting at headquarters, he network can offer a template for reaching a scale
invested in branches and employee training. And he that most of his rivals only dream of. “I can do
has regularly visited smaller offices across Europe domestic acquisition or combination in 13 coun- “Europe
to meet with bosses, middle managers and entry- tries,” he says. “What you would call cross-border, needs banks
level employees, bringing a new feeling of enthusi- I would call domestic.” with market
asm among some staff. “He’s totally committed in For now, though, he says he’s happy to focus capitalizations
28 everything he does,” says Marina Natale, a former on smaller purchases to bolster the bank’s poten- ahead of
UniCredit chief financial officer who’s known Orcel tial, with a constant eye on raising revenue and the $100 billion
since his time at Merrill. overall value of the firm. A November deal for the if we want
And customers say he has an investment banker’s Greek government’s stake in Athens-based Alpha this economic
relentless focus on their needs, something that’s not Bank for about €300 million was his first foray out- bloc to hold
always automatic in retail lending. Orcel has “made side Italy since taking charge. vis-à-vis the
a real break with the past,” says Massimo Perotti, Orcel makes clear that investors should expect US or China”
CEO of Sanlorenzo SpA, a luxury yacht maker and this tactic to continue, provided the right opportu-
a major client of both UniCredit and Intesa. “I can nities appear. He’s also upbeat on the bank’s prof-
see a huge difference in the approach,” he says. “I itability growth, even with the looming slowdown
feel like I matter.” in interest income. In the coming years, he says,
Orcel exhibits an alpha-male persona, sometimes UniCredit will continue ratcheting up its targets
water-skiing near London at dawn or surfing off the from a 2023 goal of €7.5 billion in net profit and
coast of Portugal, where he has a home. That’s made revenue topping €22 billion.
him the subject of snarky asides, with some employ- A bigger acquisition would be tougher, as
ees dubbing him “Chuck,” after the martial arts UniCredit’s valuation is lower than most relevant
actor Chuck Norris. Others call him Megadirettore peers. Orcel admits that UniCredit’s share price
Galattico, a reference to a 1970s Italian satire about takes those kinds of deals off the table for now.
downtrodden corporate workers and their over- And it’s unclear whether his shareholders, gener-
weening boss. ally pleased with the reliable payouts they’re get-
During his stint at UBS, Orcel transitioned from ting, would really welcome a megadeal. But if his
dealmaking to restructuring as the Swiss lender was plan to turbocharge the bank’s valuation comes off,
forced to dramatically downsize its investment bank he says he’ll be ready. “If it’s not the right terms, if
following a rogue trading scandal and a government it’s not the right way, it’s better not to do it,” he says.
bailout. He oversaw thousands of job cuts, setting But “if we were to do something, we are extremely
the stage for a pivot to wealth management that ush- confident that we can extract the value from it.”
ered in a decade of stability. His experience at the �Sonia Sirletti
Zurich lender helped put UBS in a position to res-
THE BOTTOM LINE By supercharging UniCredit’s earnings and
cue its stricken neighbor, Credit Suisse, last March— promising to hand out at least €6.5 billion a year to shareholders,
and honed the skills Orcel needed to run a complex Orcel has nearly tripled the bank’s share price since taking over.
Bloomberg Businessweek December 4, 2023

E Auf Wiedersehen,
C Big Stimulus
O ● Germany and other European debt to 60% of GDP is supposed to kick in again in
January. Finance ministers from the bloc’s 27 mem-

N
nations are coming under bers are wrangling over the details, but the bigger
pressure to rein in spending picture is clear: Borrowing can’t be allowed to run
amok anymore.
“We’ve had this huge amount of fiscal stimulus,”

O In case anyone doubted that Europe’s era of said Jason Davis, a portfolio manager at JPMorgan
extra-large stimulus was over, its biggest econ- Chase Bank, in a Nov. 23 interview on Bloomberg
omy just abruptly slammed the brakes on gov- Television. “Whether the rules come back in
ernment spending. January or they’re not organized until the middle

M Stymied by a ruling from Germany’s top court, of next year, we still think there will be pressure for
the country’s political leaders are in crisis mode economies to tighten budgets.”
as they recalibrate their budget for this year and Governments are starting to fall in line,
rethink their strategy for managing public finances. ­prodded by markedly higher debt servicing costs

I
30
The legal issue centers on the deployment of and scrutiny from investors and debt ratings com-
special funds that aren’t part of the federal bud- panies. Longer-term pressures, from greening
get to support large-scale investments. Successive industries and the energy grid to the fallout from
governments have resorted to this tactic to get

C around a constitutionally enshrined “debt brake”

that places stringent limits on the size of govern-
ment deficits and public borrowing. The case
in question focused on repurposing Covid-19

S ­emergency funds for greening and modernizing

the economy.
The ruling in the southwestern German city of
Karlsruhe on Nov. 15 effectively disabled one of
those special vehicles and implicitly cast doubt
on hundreds of billions of euros in other financ-
ing. Back in Berlin, Chancellor Olaf Scholz’s
three-party coalition is now agonizing over
how its whole program to make the economy ▶ Scholz
­climate-friendly can proceed.
It’s a coincidence, but notable, that the crisis
is happening just as countries around the
region, Germany included, are supposed to
embrace a period of leaner government after
years of spending freely to fight the Covid
pandemic and the Ukraine war-induced
energy crisis that followed.
CREDITS CREDITS CREDITS

With those emergencies addressed for

now, the European Union’s long-­standing
Edited by
rule limiting budget deficits to 3% of
Cristina Lindblad gross domestic product and public
◼ ECONOMICS Bloomberg Businessweek December 4, 2023

aging populations and shrinking labor forces, are Scholz’s ­cabinet has approved a suspension of the ▼ Germany’s off-
budget funds
added incentives. debt brake for 2023, a move that won’t add to over-
The shift away from stimulus was noted by EU all borrowing. A freeze on almost all new spend- Climate Other
officials, who in their latest set of economic fore- ing remains in force for now, and the ­outlook may funds €357b
€212b
casts, released in mid-November, said the bloc’s stay murky for weeks as officials attempt to devise
fiscal stance is projected to “turn contractionary” a legally watertight budget for 2024, leaving observ- Energy
subsidies
this year and weigh even more heavily on growth ers little to go on to gauge the impact. €200b
in 2024. Overall debt as a percentage of GDP is also Bloomberg Economics is downbeat, warning that €100b
receding, they said. growth in 2024 could slow to less than half the 0.9%
The UK—now long exited from the EU but fac- it’s forecasting if spending must be sharply reined in. Military upgrades

ing similar pressures—is also acting to bring its bor- Veronika Grimm, a member of Germany’s
rowing under control. A mini-budget unveiled on Council of Economic Experts, told Bloomberg Annual budget
€476b
Nov. 22 contained some small print confirming that Television that the extent of the fallout will depend
by 2027-28 Britain’s tax burden is set to rise to the on whether the coalition government and opposi-
highest level since World War II. tion can cut a deal. Any change to the constitution
As the UK and other big European economies to alter the debt brake would require a two-thirds
are realizing, however, it’s hard to wean voters off majority. “The situation is very challenging,” she
extra aid. In Italy, which has a debt ratio of around said. “The government really has to act rapidly.”
140% of GDP and a Moody’s Investors Service However things pan out, it’s clear that any new
credit rating close to junk, Premier Giorgia Meloni spending commitments will take far more political
has stuck with measures that will keep the deficit effort to work through than before.
above 3% until 2026. France, with a smaller burden The country’s budget quandary increasingly
but an even more demanding electorate, recently looks like another sign of an unstoppable turn of
found itself on one of the European Commission’s the region’s fiscal tide. Europe’s stimulus party was
SINA SCHULDT/PICTURE-ALLIANCE/DPA/AP PHOTO. DATA: GERMAN FINANCE MINISTRY, FEDERAL COURT OF AUDIT.

naughty lists because the country’s draft budget already winding down; now Germany’s judges have
for 2024 risks flouting its fiscal guidance. turned out the lights. �Craig Stirling, with Kriti 31
Germany was deemed by Brussels to be still too Gupta, Iain Rogers and William Horobin
generous with energy aid, but it also stands out for
THE BOTTOM LINE A court ruling in Germany has thrown
its prudence. As the economic engine of the region, government finances into disarray and may curb growth in 2024,
with a debt ratio less than half of Italy’s, its public while Brussels is asking EU members to cut back energy subsidies.
finances have long provoked both envy and frus-
tration among its European peers.
OFF-BUDGET FUNDS ARE MULTIYEAR, ANNUAL BUDGET IS FOR 2023

The country’s allergy to budget deficits is

grounded in its citizens’ own reluctance to bor-
row. (In German, the word for “debt” also means
“guilt.”) Prior to the pandemic, at a time of ultralow
borrowing costs, that stance was deemed absurd by
Alberta’s New Allure
international economic observers. But when Covid
struck, Germany was able to unleash massive fiscal ● Canadians are flocking to the energy-rich
support for households and businesses—amount- province for its more affordable housing
ing to hundreds of billions of euros—followed by
aid to ease the pain from soaring energy bills after
Russia’s invasion of Ukraine. What’s more, a huge Nicole Kealy was something of a trendsetter. In
EU spending program to help pandemic-crippled January 2022 the mother of four sold her home in
countries such as Italy could proceed only with Chiliwack, British Columbia, to move across the
Germany’s backing. Canadian Rockies to Calgary, Alberta, in search of
German Finance Minister Christian more affordable housing.
Lindner, a fiscal hawk, was already well on the With the profit her family made on their
way to returning the budget profile to nor- C$1.4 million ($1 million) Chiliwack home—which
mality, but he was also leaning harder than had appreciated about 66% in the roughly year and
before on special off-budget funds to meet a half they owned it—Kealy and her husband were
coalition partners’ policy demands for able to buy a C$550,000 house in Calgary, along
investment in green projects and main- with an apartment and a townhouse they rent out.
taining the country’s social safety net. Between their new rental income and the sav-
That approach is now in tatters. ings on their own housing costs, the Kealys are
◼ ECONOMICS Bloomberg Businessweek December 4, 2023

living comfortably for the first time in years.

They’ve even been able to splurge on home
­renovations and a vacation to the Dominican
Republic. “In BC we had pretty good jobs, we
made pretty good money, and yet we were still
barely keeping up,” says Kealy, 43, who is a
teacher. “Here we’re mortgage-free, and we have
two rental properties.”
In the year or so following the Kealys’ move, tens
of thousands of British Columbians and Ontarians
have decamped to more affordable Alberta. The
oil-rich province’s population surged 4.1% in the
12 months through June, the fastest pace in Canada
and a rate that puts developing countries to shame.
In absolute terms, most of Alberta’s new resi-
dents come from abroad, with international immi-
grants accounting for slightly more than 60% of the
population increase, according to Mark Parsons,
chief economist at ATB Financial, a bank based
in the provincial capital of Edmonton. But all of
Canada is experiencing an immigration boom as The Bank of Canada’s rate-hiking campaign ▲ A crush of commuters
in downtown Calgary
Prime Minister Justin Trudeau increases targets for that started in March 2022 has exacerbated the
inflows from abroad to keep the population grow- situation, raising the cost of financing home pur-
ing and the economy expanding. chases significantly while leading to only small
What sets Alberta apart is interprovincial price decreases. Rates for conventional five-year
32 migration, which accounts for almost a third of mortgages have risen about 225 basis points since
the population increase, Parsons says. Of those early 2022.
new Albertans, nearly three-quarters come from The influx is welcomed by the province’s
Ontario and British Columbia. business community, which sees it as insurance
The main draw is Alberta’s relatively cheap against the labor shortages that have been so com-
housing. Real estate prices in Ontario and British mon since the pandemic. For provincial author-
Columbia soared during the Covid-19 pandemic, ities, the infusion of new workers is a sign that
while Alberta stayed relatively flat. The result is that decades-long efforts to diversify the economy “Here we’re
the benchmark home price in Calgary, the province’s away from the boom-and-bust energy industry mortgage-
largest city, was C$561,500 in October, less than half are finally paying off. free, and we
the C$1.21 million average in greater Vancouver and Alberta’s previous population surges were have two rental
C$1.13 million average in greater Toronto, according driven largely by major expansions of oil and gas properties”
to the Canadian Real Estate Association. projects, but the industry has played only a minor
role in the current one. This time the standouts
are technology—including fintech, agricultural
Breaking Down the Boom tech and cleantech—as well as energy-adjacent
Net population change in Alberta sectors such as hydrogen and biofuels.
◼ Interprovincial migration ◼ International migration ◼ Natural An increase in remote work also may be con-
tributing to the population surge, though data on
45k the phenomenon is spotty. The most recent fig-
ures from late 2021 show about 100,000 Canadians
30 working for an employer outside of their home
province, according to Parsons. “We suspect
15 remote work is playing a role,” he says. “If it’s
an affordability story, then you would think that
0 more remote workers are choosing Alberta.”
Notable wins in recent years include Royal
-15 Bank of Canada’s 300-person Innovation Hub,
Q1 2013 Q2 2023 which opened in late 2021, and Indian IT colos-
DATA: STATISTICS CANADA, ALBERTA TREASURY BOARD AND FINANCE sus Infosys Ltd.’s announcement about a year ago
◼ ECONOMICS

Inflation The Real Feel

that it would double the size of its Calgary office
to 1,000 workers. Since early 2020, US prices have risen
“There’s critical mass,” says Deborah Yedlin, about as much as they had in the 10 years
chief executive officer of the Calgary Chamber of
Commerce. “People are realizing that there’s an
preceding the pandemic. We crunched
ecosystem here to support the diversification of the numbers for everything from rent to
the economy.” romaine. �Reade Pickert and Jennah Haque
But the tide of new arrivals has its downsides.
The influx is crowding classrooms and further
straining an already stretched health-care system. Grocery inflation is expected Housing is less affordable for
It’s also driving up home prices in Calgary. to return to less than 2% renters and buyers alike.
PHOTOGRAPH BY GAVIN JOHN FOR BLOOMBERG BUSINESSWEEK. DATA: BUREAU OF LABOR STATISTICS, ZILLOW, US ENERGY INFORMATION ADMINISTRATION, FEDERAL RESERVE DISTRIBUTIONAL FINANCIAL ACCOUNTS, BANK OF AMERICA INSTITUTE. SAVINGS

The federal and provincial governments have next year, but that might not
Change in seasonally adjusted Zillow
pushed more responsibility for housing, men- offer American consumers indices since January 2020
tal health and addiction treatment down to the much relief. Rent
40%

city level for decades, without a corresponding Home value

Change since January 2020
increase in funding, says Calgary Mayor Jyoti
◼ Over 20% ◼ Over 40%
Gondek. “If we don’t keep pace with housing 20
1/2020 10/2023
and we don’t keep pace with getting the proper
Orange juice $2.32 $3.67
funding and financing models with the other two
12-pack soda 4.33 6.77
orders of government to support things like public 0
Coffee (1 lb) 4.17 6.18
education and public health, we’re not going to be 1/202010/2023
White bread 1.35 2.00
able to take care of the folks that are coming here,”
Eggs (1 dozen) 1.46 2.07
says Gondek, who took office in October 2021.
Yogurt (32 oz) 4.43 6.28 Change in average residential electricity
On the housing front, the city has a program to prices from August 2019 to August 2023
Chicken breast (2 lb) 6.12 8.44
encourage converting unused office space into res- ◼ Under 10% ◼ 10-30% ◼ Over 30%
Ground beef (1 lb) 3.89 5.23
idences. So far, Calgary has invested C$153 million 33
Uncooked rice (1 box) 1.43 1.92
into 13 approved projects and has four more in the
Romaine lettuce 2.16 2.72
pipeline, Gondek says, which will net 2,300 addi-
Large potatoes (4) 3.21 4.02
tional units of housing.
Milk (1 gal) 3.25 3.93
DATA BASED ON HOLDINGS OF DEPOSITS, DEFINED AS CHECKABLE DEPOSITS AND CURRENCY PLUS TIME DEPOSITS AND SHORT-TERM INVESTMENTS

Until more supply is built, the local housing

Butter (1 lb) 3.86 4.55
market is likely to remain in a frenzy, says Cindy
Banana bunch 1.14 1.25
Bauer, who has been a real estate agent in Calgary
Tomatoes (1 lb) 2.22 1.87
for almost two decades. She says that most proper-
ties receive multiple offers for well over the asking
price, and buyers face pressure to waive inspection Increase in price from January 2020 to October 2023, Increase in price
seasonally adjusted from 2019 average
and financing conditions. to September 2023
Out-of-province buyers now account for about
Used cars Car insurance Natural gas Child care
15% of Bauer’s work, up from 5% in prior years,
with some purchasing homes sight unseen. That
increased competition—especially from cash-
35% 33% 29% 32%
flush buyers from BC and Ontario—has younger
Calgarians feeling like they’ll never be able to buy, The cost-of-living squeeze is After adjusting for inflation,
she says. eating into pandemic savings. hourly wages have barely
With the Bank of Canada expected to begin budged since 2020.
Change in aggregate savings by income
­cutting rates next year, home prices may only quintile, since Q1 2020
rise further, creating an even more “exhausting” Q1 ’22 peak
Nominal wages
▲ 19.6%
­situation, Bauer says. 40% $30

“You go in, you compete with 12 people, and

only one wins—that means 11 people walk away Top 20%
devastated,” she says. “And then the next house 20
Fourth
20

that comes on, we all rush and go do the same Third

Second
thing.” �Kevin Orland Bottom 20%
0 10 Real wages
▲0.6%
THE BOTTOM LINE Alberta’s population surged 4.1% in the
Q1 ’20 Q2 ’23 1/202010/2023
12 months through June, the fastest pace in Canada. The influx is
helping to diversify the economy away from fossil fuels.
Bloomberg Businessweek December 4, 2023

On New Year’s
Eve 2020, young
women from a
Long Island town
were horrified
to learn their
photographs had
been manipulated
and posted online.

When the law

failed them, they
tracked down the
culprit themselves

The Legal Netherworld of Deepfakes

h k
e

e
d

l
o
h
a

By Olivia Carville
and Margi Murphy
Illustration by
Lulu Lin s
35
Bloomberg Businessweek December 4, 2023

completely naked. She knew the breasts featured thousands of images. Some
weren’t hers, but they looked real were rudimentary, made with basic
enough that other people might think ­photo-editing software. Others were
they were. She was too stunned to speak. more ­sophisticated: faces stitched seam-
The next image made her gasp. It lessly onto bodies engaged in sex acts,
showed a printout of a photo taken when women who’d been digitally undressed.
she was 5, with the chubby cheeks and Threads posted on the site detailed vio-
“Do you have a second? ringlets she’d long since grown out of. An lent fantasies. Some urged internet trolls
erect penis rested atop the photo, touch- to find and rape the women.
ing her face. The accompanying post Wallace found an account that had
encouraged men to ejaculate on it. Then been sharing the photos. The man was
she read: “Spit on this Spanish spic.” later charged with blackmail, harassment
“Oh, my God,” Luque said, choking. and possession of child pornography, but
“I started crying really hard,” she to Wallace’s chagrin, ­cumonprintedpics
says, nearly three years later. “You know .com remained in operation.
I need to call you.” that kind of cry where you sound like In the months that followed, as a
The text came through on Cecilia you’re dying? All the heavy breathing group of young women on Long Island
Luque’s phone around 5:45 p.m. on the and shaking and everything.” made it their mission to uncover who’d
last day of 2020. She was in a shopping She drove back to her boyfriend’s put altered images of them online,
mall parking lot not far from her home in house and called the cops. An hour Wallace continued his investigation into
Levittown, a New York suburb on Long later detectives from the Nassau County the website. When he found out it was
Island. She was sitting with her boyfriend Police Department were knocking on the charging women to remove photos, he
in her black Jeep Liberty, waiting for his door. She hadn’t been the first to call that says, he was furious. “Who the f--- do
shift at a movie theater to start. They night. Word of the website had spread they think they are to not only run a web-
were chatting about the New Year’s Eve across Levittown. More than 40 girls site like this, but to also charge people to
36 party they were hosting later that night. from MacArthur High had been targeted. remove content?” he thought. “And how
The message was from a former class- Some were working shifts in clothing are they getting away with this?”
mate at General Douglas MacArthur High stores or sitting at home watching New
School. Luque found it odd. They’d grad- Year’s Eve celebrations on TV when they NO FEDERAL LAW criminalizes the
uated a year and a half earlier and hadn’t opened the link to see doctored nude c­ reation or sharing of fake pornographic
talked in months. She texted back, ask- pictures of themselves. Others were at images in the US. When it comes to fake
ing if she could call in 10 minutes, after college parties and ran home in tears. nudes of children, the law is narrow and
her boyfriend left for work. “He’s gonna pertains only to cases where children
wanna hear this, too,” the reply said. HALF A WORLD away, unbeknown to are being abused. And Section 230 of the
Luque put the call on speaker. There’s anyone in Levittown, a former police offi- Communications Decency Act protects
a website, the classmate said. A weird cer named Will Wallace was ­investigating web forums, social media platforms and
and creepy site where someone is post- a possible internet sex crime in New internet providers from being held liable
ing explicit photos of girls from school Zealand. Earlier in 2020, an ex-colleague for content posted on their sites.
and writing about them being raped and had called him about a case that had This legal landscape was problem
murdered. “There’s pictures of you on it, stumped police. A woman was being enough for police and prosecutors
and I wanted you to know that,” she said. bombarded with anonymous emails con- when it took time and a modicum of
The phone buzzed as a link to taining pictures of herself next to erect skill to create realistic-looking fake por-
the website came through. It had an male genitalia. The photos had also been nography. But with billions of dollars
­extremely graphic internet address: sent to her parents and to a boyfriend, of venture capital flowing into image-­
­cumonprintedpics.com. Luque started who’d broken up with her after receiving generating software powered by arti-
scrolling. She saw Ana, a classmate, in them. The harassment had been going ficial intelligence, it’s gotten cheaper
her cheerleading uniform. And Ruby, a on for years. Wallace, who was trained and easier to create convincing pho-
friend who’d sat beside her in ­detention. to dig up evidence online and hoped to tos and videos of things that never hap-
Then she saw a photo she recognized. start a private investigation business, pened. Tools such as Midjourney and
It was her, at 18, standing in a dressing decided to look into the case. Stability AI’s Stable Diffusion have been
room. But the swimsuit she’d been wear- Using a reverse image search used to produce images of Pope Francis
ing in the original photo, the one she’d tool to find places the photos had in a puffer jacket, actress Emma Watson
uploaded to social media, was gone. appeared online, he was directed to as a mermaid and former President
Someone had digitally altered the pic- ­cumonprintedpics.com. The site, which Donald Trump sprinting from a cadre
ture so it looked like she was posing had been around for about a decade, of FBI agents.
Bloomberg Businessweek December 4, 2023

The term “deepfake” was coined on

a Reddit forum dedicated to fake porn
made with deep-learning models. It’s
now in the Oxford English Dictionary,
defined as an image digitally manipu-
lated to depict an individual doing some-
thing they didn’t. More than 15 billion
such images have been created since
April 2022, according to Everypixel
Group, an AI photo company. The ven-
dors that designed these tools have
installed safety filters to ban the creation
of explicit images, but because much of
the software is open source, anyone can
use it, build off it and deactivate the safe-
guards. Online security experts say more
than 90% of deepfakes are pornographic
in nature. Mark Pohlmann, founder and
chief executive officer of Aeteos, a con-
tent moderation company, says he’s
seen doctored images of girls as young
General Douglas MacArthur High School in Levittown
as 3 dressed in leather, their hands tied
­together, their throats slit.
Like many technological advances, porn laws, and a few, including New By New Year’s Day 2021, the former
these AI tools edged their way into pop- York, have amended them to include MacArthur students had group threads
ular culture before lawmakers and deepfakes. But some prosecutors say going, seeking to support one another 37
law enforcement authorities under- those laws apply only to intimate ­photos and unmask the predator behind the
stood their power. One man who did shared consensually. As for images harassment. They already had a sus-
is Björn Ommer, a professor at Ludwig pulled from social media and doctored pect: Patrick Carey, a former classmate
Maximilian University in Munich and to become sexual content, no law exists. who was then 19. He’d never played
co-creator of Stable Diffusion. Ommer sports or had a girlfriend, and they
says he told academic colleagues last LEVITTOWN, THE FIRST postwar regarded him as a stoner with a supe-
year, before Stability AI released the soft- US suburb, looks much as it did in riority complex. His father was a police
ware to the public, that he was “deeply the late 1940s, when it was built detective in New York City.
concerned” it had the potential for great for ­veterans—White veterans only—­ Some of the young women had pre-
harm and wanted researchers to stress- returning from World War II. The streets viously received Snapchat notifications
test it first. But it was rushed out anyway, are still wide and tree-lined. The single-­ that Carey had taken screen captures
he says, to a­ ppease investors. (A spokes- family homes are still uniform, tucked of ­bikini shots they’d posted—pictures
person for Stability AI didn’t respond to behind manicured lawns and picket that had later appeared, altered, on
questions about Ommer’s allegations but fences. The 52,000 residents are still cumonprinted­pics.com. Others recog-
said the company is “committed to pre- overwhelmingly White. Many work as nized his handwriting from images on
venting the misuse of AI” and has taken teachers or cops. “It’s a very close-knit the site with words like “whore” and
steps to prohibit the use of its models for community,” Luque says outside her “slut” written across their faces. Luque,
unlawful purposes.) father’s house. Now 22 and an art stu- who was friends with Carey in school,
PHOTOGRAPH BY SHRAVYA KAG FOR BLOOMBERG BUSINESSWEEK

In October, the Biden administra- dent at a nearby community college, she saw his writing style in some of the long,
tion issued an executive order seeking to goes by her middle name, Cecilia. “All detailed fantasies posted along with the
prevent AI from producing child sexual the houses are right next to each other, pictures. Several shared their suspicions
abuse material or non­consensual inti- and on the inside they all look exactly with their parents and the police, who
mate imagery of real individuals, but it’s the same,” she says, waving to a neigh- told them there wasn’t much they could
unclear how and when such restrictions bor walking a dog. “Levittown is such do. They didn’t have probable cause for a
would go into effect. More than a dozen a safe place to be. Nothing weird ever warrant to subpoena Carey’s IP address.
states have passed laws targeting deep- happens here. Kids don’t get abducted. Cyberharassment cases are gener-
fakes, but not all of them carry c­ riminal People don’t get hurt or assaulted or ally hard to prove. Keyboard predators
charges; some cover only election-­ anything like that. And that’s why this are savvy and know how to cover their
related content. Most states have revenge was all so crazy.” tracks. Digital evidence they may
Bloomberg Businessweek December 4, 2023

fail to mask or delete is difficult to the Nassau County Police Department Carey’s
c­ apture and time-consuming to p ­ rocess. said ­detectives “conducted a thorough mug shot
The detectives hunting them are often investigation.” He didn’t respond to
more comfortable investigating IRL specific questions about the case.)
(in real life) crimes. Online vulgarity isn’t The victims and their parents cared
high on police priority lists. In this case, less about the nuances of the law than the
what the person had done might be gro- immediate danger. The prime s­ uspect
tesque, but it wasn’t ­obviously illegal. was in their community. If the police
Months went by without an arrest. weren’t going to do something about it,
Deepfake images of Levittown girls, they’d have to do something themselves.
some made from pictures taken when
they were as young as 13, were still being OVER THE SUMMER, a former tell her he’d “rather be with the devil.”
posted from accounts with names like MacArthur cheerleader found a Carey liked to stir up debates on
Serryjeinfeld and Tweenhunter. The ­disturbing photo of herself on the site. ­s ocial media. He’d told some girls
material was getting even more graphic. She was smiling, wearing a white tank their viewpoints on issues like Black
Some threads had reached 30,000 top and jeans. Beside that picture was Lives Matter were misinformed. “You
views, including one where the poster what looked like a deepfake image of don’t need me to explain what a false
asked users to send voice r­ ecordings to a woman in the same outfit covered in ­dichotomy is, do you?” he teased one.
a girl threatening to rape her to death to blood, her hands tied behind her back “You’re basically a socialist,” he wrote
“finally teach her not to be such a teasing and a plastic bag over her head. The another. “I’m just trying to spare you
cum target.” In May 2021 he wrote about caption used her real name and said the next five to 10 years of irratio-
her again, saying how funny it was “see- her body had been found near an aban- nal thinking.” He didn’t sit for a grad-
ing which TikToks she deletes after they doned construction site with semen uation photo in the 2019 MacArthur
yearbook—beside his name it just says
“camera shy.”
38 Ana knew Carey was odd, but she
One victim dropped out of college. didn’t think he was perverse enough to
be behind the pictures. She decided to
Another says she lost 20 pounds from stress. start her own investigation to unmask
At least two started carrying knives the predator and see if she could clear
Carey’s name. From her bedroom,
she spent hours each night scrutiniz-
ing every post her harasser made. In
get posted here.” He began including the in her mouth, anus and vagina. And it one, he’d shared an image of his geni-
former students’ full names, addresses, claimed a video of her death was cir- tals bulging out of a little girl’s under-
phone numbers and social media han- culating on the dark web. “I’d had wear while standing in a girl’s bedroom.
dles and prompted others to contact enough—it had to stop,” says the former Looking closely at the background, she
them directly. student, Ana, who asked to be identi- saw a white dresser with brown trim
By summer 2021 the young women fied only by her first name to avoid fur- and a stuffed toy sloth on a bed.
started receiving private Facebook, ther harassment. Carey had younger twin sisters,
Instagram and Snapchat messages with Ana was then working as a special and Ana began searching for them on
their photos beside male genitalia, or needs aide at an elementary school in ­social media. She discovered that one
covered in semen. They got calls late Levittown. She’d heard that many of her of them was posting dancing clips on
at night from ­foreign ­numbers, with former classmates suspected one of her TikTok. They were filmed from the
heavy breathing at the end of the line. oldest friends was behind the pictures. exact same bedroom she could see on
In response, most ­deleted their ­social She’d known Carey since she was 5. His ­cumonprintedpics.com, in front of the
media accounts. One dropped out of col- parents’ modest clapboard house backed same dresser, with the same brown trim.
lege. Another says she lost 20 pounds onto East Broadway Elementary School, Even the sloth was in the same position
from stress. At least two started carrying which they’d both attended. By the time on the bed. “Oh, my God, this is crazy,”
knives in their handbags. they got to MacArthur, Ana was a cheer- Ana recalls thinking. “It really is him.”
The gravity of the posts did little to leader in the popular crowd, while Carey She says she sent the photos to
accelerate the police response. They was into grunge music and weed. But Detective Timothy Ingram, the lead
told the young women they were still they remained friends, sitting together in investigator on the case, in August 2021.
working on the case but provided no a ninth-grade computer class. He’d regu- “You girls are doing our detective work
further information. (A spokesman for larly tease her about being Christian and for us,” she remembers him saying.
Bloomberg Businessweek December 4, 2023

THAT SAME MONTH, in New Zealand, At the station, Carey gave a sworn to boost his posts and make them
Will Wallace was closing in on the statement saying he’d created an account ­appear more popular. In one, he’d even
p erson behind cumonprintedpics
­ on cumonprintedpics.com in his senior pretended to be a victim, begging for
.com. The hunt had become an obses- year, when he was bored and addicted the harassment to stop.
sion. Disturbed that no one had been to online porn. He said he got a kick out The prosecutors obtained ­warrants
able to shut down the site, he spent eve- of the way the site’s users “shamed girls,” to gain access to Carey’s phone and
nings when he wasn’t busy with family “wrote rape fantasies about them” and apps, including 10,000 pages of
responsibilities or online studies for shared their personal information. Instagram direct messages. They saw
a psychology degree trying to find out Carey’s case landed with Melissa evidence that he’d culled photos from
who was behind it. Scannell, an assistant district attorney social media and used software such as
After months of dead ends, he’d and chief of the cybercrime division for Body Editor to d­ igitally undress his sub-
hit on the idea of sending an email to the Nassau County District Attorney’s jects. “Some were so good you wouldn’t
an address on the site that ­offered to ­office. With a background in child sexual know they were fake,” Scannell says.
remove photos for a fee. In his note, abuse cases, Scannell was familiar with The prosecutors soon understood
Wallace requested the removal of some the dark corners of the web. Working why police had struggled to identify
fake nudes related to a case he was work- out of an office at the county courthouse appropriate charges. New York’s penal
ing on. He got a response asking for $99 in Mineola, she began reading Carey’s code bans promoting a sexual perfor-
to take them down and happily obliged. posts. “The tenor of what he was writing mance by a child, but the image needs to
The invoice came from a company in scared me,” she says. “I had a fear that depict a real incident. The images Carey
California called L.A. Nerd IT Consulting, this was going to go off the internet.” manipulated or defiled didn’t seem to
but the payment went to Cloud The police had filed low-level qualify. Nor did the prosecutors have a
Cyberservices LLC. Wallace learned ­h arassment and obscenity charges path under the state’s 2019 revenge porn
that Cloud was registered in the UK to against Carey, which were unlikely to law, because the photos Carey had used
one Scott Trentcosta, born in 1993. The result in jail time for a young first-time had been posted publicly. Undeterred,
last name had appeared in some email ­offender. Scannell had 90 days to raise they pored over the penal code and
addresses he’d previously connected the stakes. After reviewing Carey’s spent weeks analyzing all 1,198 photos 39
to the early registration of the website. posts, she walked into the o ­ ffice of fel- Carey had uploaded to the site. “We were
“Gotcha,” Wallace thought. low assistant district attorney Kelsey getting loopy by the end,” Scannell says.
A public records search turned up a Lorer, who’d gone to MacArthur High, Then, on Oct. 5, Lorer found a real
Scott Trentcosta of the right age resid- and said, “You gotta see this shit.” image of a 14-year-old girl’s genitals
ing in Louisiana. He also learned that The two got to work filing subpoenas that Carey had shared on the site. The
a company that had appeared on bank for all the IP addresses linked to Carey’s photo, taken without her consent six
statements of some victims who had account on cumonprintedpics.com. years before by her then-­boyfriend,
CAREY: NASSAU DISTRICT ATTORNEY. SCANNELL AND LORER: PHOTOGRAPH BY SHRAVYA KAG FOR BLOOMBERG BUSINESSWEEK

requested to have their images removed, They found he’d created 14 u ­ sernames had spread through the school via
Nola Cyberservices LLC, was regis-
tered to Trentcosta in the same state. It Nassau County prosecutors Lorer and Scannell
appeared he’d found the man behind
­cumonprintedpics.com.

ON SEPT. 5, 2021, according to a p­ olice

report, Detective Ingram knocked on
Carey’s door, armed with printouts of
some of the worst posts. He was home, as
was his mother. Ingram started reading
the posts aloud. Carey’s mother pleaded
for him to stop and turned to her son,
who admitted he’d written them.
The report is scant on details, and
Ingram didn’t respond to requests for
an interview. But clearly the detective
heard enough: He seized Carey’s phone
and tablet, placed him under arrest
and escorted him out of the house
without giving him a chance to put on
his shoes.
Bloomberg Businessweek December 4, 2023

texts and social media. The district Kayla

­ ttorneys were aware of the image
a Michelle
because the girl had complained to
police about it more than a year earlier.
The statute of limitations had expired
for the ­former boyfriend, but not for
Carey, who’d shared the image in 2020.
“I think we’ve got it!” Lorer yelled,
running into Scannell’s office.
Two months later, Carey was charged
with multiple felonies, bringing the
total number of counts against him to
33. He pleaded guilty in December 2022
to misdemeanor child endangerment
and three felonies: promoting a sex-
ual performance by a child, aggravated
­harassment and ­second-degree stalking.
Not one of the charges related to the
1,198 nonconsensual pornographic
deepfake images he’d created.

AS CAREY’S CASE headed toward

s­entencing, Will Wallace’s efforts
to expose Scott Trentcosta and get
­cumonprintedpics.com taken down
40 were getting nowhere. He’d tried sending
the information to law enforcement offi-
cials in Louisiana and emailed reporters
there with the information he’d uncov-
ered. No one replied. He wrote a blog
post laying out the details. No response.
Then, in January 2023, Wallace dis-
covered a Reddit forum where posters
band together to go after websites that and when he didn’t get a response, he testified at the hearing, a young woman
host nonconsensual pornographic con- added a ­paragraph to its Wikipedia named Kayla Michelle (she asked us not
tent. One target was cumonprintedpics page. It read: “DDoS-Guard protects to use her last name) who’d known Carey
.com. Wallace reached out to the blog- the fetish forum and non-­consensual since she was 13. “We were friends,” she
ger leading it, Claudia Lopez, and she imagery website c­ umonprintedpics. says. “We hung out all the time.” Even
shared his investigation unmasking The website is known for providing a after they finished school, Carey would
Trentcosta on the forum. Dozens of trolls platform for men to sexually degrade send her jokes on Instagram.
found Trentcosta’s relatives and called images of women.” Now 23 and working in ­insurance,
them. They hacked into his ­university Within a few days, on April 10, Kayla had been one of the first
email and tracked down an old mug cumonprintedpics.com was offline. in Levittown to find out about
shot for marijuana possession. And they DDoS-Guard confirmed in an email to ­cumonprintedpics.com. Her father, an
PHOTOGRAPH BY SHRAVYA KAG FOR BLOOMBERG BUSINESSWEEK

spammed threads on cumonprintedpics Bloomberg Businessweek that the website officer with the Nassau County Police
.com with Trentcosta’s name and photo. is no longer using its services. It didn’t Department, had searched her name
Every post was removed immediately. say why the site went dark. “Finally,” online one night in early 2020 and
As all that was happening, Wallace Wallace told his wife, “this dump has found something that disturbed him.
and some of the vigilantes were going been taken down.” “Are you aware of this?” he asked her,
after the site’s business model. First they showing her a website on his iPhone. It
reported the site to online a ­ dvertising PATRICK CAREY APPEARED for had a picture of Kayla standing in her
company ExoClick, which pulled its ads. s­entencing in Nassau County eight boyfriend’s backyard, but the bikini
Then they turned their attention to the days later. He’d been staying at home she’d been wearing in the original shot
site’s host, Russia-based DDoS-Guard. since being released from police cus- had disappeared. She found pictures of
Wallace sent an email to the provider, tody 19 months earlier. Only one victim herself at 15 with braces, alongside posts
Bloomberg Businessweek December 4, 2023

encouraging users to vote on which sex District Attorney Anne Donnelly said the Later that day, Scannell and Lorer
act they wanted to do with her, includ- depravity on display in the case “truly sent their letter to the administra-
ing drinking her urine. Her father tried makes my skin crawl.” But Carey had tor of tributeprintedpics.com. Most of
asking his colleagues for help but was under­estimated the bravery of the young the MacArthur class of 2019 deepfakes
told there wasn’t much they could do. women he’d targeted, she said, “and that have since been removed from the site,
The photos were fake, and the poster is why we are able to stand here today but thousands of other images remain,
was anonymous. Thinking she’d been and make this announcement.” including some showing teenagers with
the only girl targeted, Kayla didn’t tell Then Donnelly unveiled a proposal semen running down their faces or par-
any of her friends. She didn’t hear any- to make deepfakes illegal in New York. ticipating in group sex. Some users on
thing more about the site until that New The Digital Manipulation Protection the site offer Stable Diffusion deepfakes
Year’s Eve, when word got out. Act, she said, would make it a crimi- for sale, while others post pictures of
She attended every one of Carey’s nal offense to publish sexually explicit women taken from social media and ask
hearings leading up to the sentencing, photos that had been digitally altered, who can “fake them.”
her dyed bright orange hair and nose whether the images were originally Businessweek’s efforts to track
piercing standing out in court. At one shared on social media or not. A ver- down Scott Trentcosta at L.A. Nerd IT
session, the father of a victim had to be sion of the bill has been introduced in Consulting’s office in Monterey Park,
restrained after trying to jump the bar- the state assembly and is looking for California, were fruitless. A person
rier to attack Carey. At another, Carey’s sponsors in the senate. at the address said no one from the
father abruptly left the courtroom, vis- company had been around in years,
ibly distressed when some of his son’s WITH CAREY BEHIND bars, the and mail addressed to Trentcosta
more graphic posts were read aloud. Nassau County prosecutors had one had been piling up. An email sent to
Kayla says that, after discovering final task. Scannell and Lorer drafted him in November, informing him that
the fake photos, “I’d lived with a fear of a letter to send to cumonprintedpics Businessweek intended to identify him
being by myself, fear of going outside, .com, providing Carey’s certificate of in connection with cumonprintedpics
fear of men in general.” She’d had night- conviction and an outline of the case. .com, elicited a plea not to “name and
mares in which strange men hunted her “Based on his criminal conviction aris- shame” and an explanation that peo- 41
or she had “rape me” tattooed on her ing out of his posts,” they wrote, “we ple who don’t want to have their pic-
forehead, just as she’d seen on the web- would respectfully request that you tures posted can have them removed
site. “I didn’t want to live my life in fear remove all posts by usernames associ- for free. The sender signed off by call-
for what he took away from me.” ated with him.” But when they went to ing the reporter “Weirdo.”
She stepped into the witness box with the website to search for the administra- As for Wallace, he’s put his hunt for
her handwritten statement. Her hands tor’s email in April, they discovered the Trentcosta on hold. He’s now work-
were shaking so much the paper was site was gone. They didn’t know that an ing as a health and safety inspector on
barely legible to her. She took three deep ex-cop in New Zealand had seen that it a construction site in Queenstown, in
breaths and looked at Carey, who didn’t was taken down. southern New Zealand.
return her gaze. “This is for all of the That should have been the end of it— The young women in Levittown are
victims,” she began. “I am looking you except it wasn’t. When Businessweek, trying to move on, but it’s hard. Fourteen
directly in the face to tell you that you drawing on police records obtained of them have protection orders out
disgust me. You had the audacity to talk through a Freedom of Information Act against Carey until 2031. They still can’t
to me through ­social media, joke with request, searched for u ­ sernames Carey grasp how what he did to their photos is
me and try to be cordial with me, while had employed on ­cumonprintedpics legal. As for Carey, he was released from
behind my back belittling me, p ­ utting .com, the names also turned up at the prison in September after four months,
me down, sexualizing my younger self URL t­ ributeprintedpics.com. It was the with time off for good behavior, and is
and body. You completely changed the same website with a different address. back home. (He and his father declined
way that I viewed myself and my body, “What?” Scannell said in August to comment for this story.)
and for that I’ll never forgive you. I hear when told about tributeprintedpics In early November, Cecilia Luque
your name, and I feel sick.” .com. “It’s back?” She tried to open it was driving through Levittown when
Carey was sentenced to six months on her work phone but was blocked she saw Carey wandering down the
in prison, 10 years’ probation and life- by a firewall. She texted a colleague, a street. He was wearing a brown hoodie
time status as a sex offender, which ­c ybercrime analyst with unrestricted and had headphones on. She recog-
meant he’d no longer be able to own a web access, and asked her to see if the nized his walk. “My heart started rac-
smartphone or any device with a cam- deepfakes of the former MacArthur stu- ing, and I started crying,” says Luque.
era or be within 1,000 feet of a school dents were still visible. Minutes later, She turned her car around to confront
or a playground. In a press conference the analyst texted back in all caps: him, but by the time she got back to the
after the sentencing, Nassau County “WHAT THE ACTUAL F---.” spot, he’d disappeared. <BW>
Bloomberg Businessweek

A D I R E F U N G A L I N VA D E R I S AT TAC K I N G P R ACT I CA L LY T H E
O N LY B A N A N A T H E WO R L D E AT S .

42
CONFRONTING THE

BY A N D R E W Z A L E S K I

C AV E N D I S H B A N A N A S I N C O L O M B I A
December 4, 2023

P H OTO G R A P H S BY M C N A I R E VA N S

BANANAPOCALYPSE 43

T H E B E ST H O P E F O R T H E CAV E N D I S H M I G H T B E
G E N E T I C M O D I F I CAT I O N

TAY L O R F R A Z I E R - D O U G L A S , L E A D S C I E N T I S T AT E L O L I F E S Y S T E M S ’ B A N A N A P R O G R A M I N D U R H A M , N O R T H C A R O L I N A
Bloomberg Businessweek December 4, 2023

DR. BANANA’S FIRST LOVE WAS COFFEE. FOR EIGHT Even after chewing through every plant, TR4 remains in the
years, Fernando García-Bastidas bred beans in his native soil, ruining the fields for future production.
Colombia, trying to make a stronger, more flavorful brew. But The fear, always, was that TR4 would creep its way into
gradually his passion grew for the banana, the fruit he’d seen Latin America, where frost-free weather and rich, alluvial soil
daily growing up in Nariño, the region bordering Ecuador to has provided the premier place for growing Musa ­cavendishii,
the south and the Pacific to the west. He began doctoral stud- the Cavendish, the world’s most consumed banana. Although
ies at Wageningen University & Research in the Netherlands, about 1,000 varieties of banana exist, including many that live
studying wild types and supermarket varieties, rare cultivars harmoniously with Fusarium, most are unfit for inter­national
and crossbreeds—and how Mother Nature sometimes con- trade. They’re too small or too seed-filled. Too fragile. Too
spires to kill them. Over the years he amassed an Instagram acidic. More tart and tough than sweet and soft.
following under the handle @drbananagarcia. By contrast, the Cavendish plant produces a wondrous
In July 2019, García-Bastidas received an SOS over WhatsApp banana. About a year after it’s planted, a secondary stalk
from a plantation farmer in La Guajira, in northeast Colombia, emerges from the pseudostem, and the inflorescence, the
one of the country’s main banana-growing regions. Healthy flowering part that transforms into fruit, appears. Out of that
banana leaves are deeply verdurous; the ones in the pictures ­second stalk grows a single bunch of bananas, which can
were more yellow than green, and their edges were marred by weigh well over 80 pounds. Each bunch contains “hands”—
the charcoal color of singed paper. “The only thing I was think- what you buy in the grocery store—that are made up of “fin-
ing,” he remembers, “is ‘I hope not, I hope not, I hope not.’ ” gers,” the individual bananas. They’re hardy enough to
A week later he flew from the Netherlands to Colombia withstand long journeys without bruising. They don’t ripen
and headed for the plantation. Donning a protective suit and too quickly. They contain no seeds, by virtue of their triploid
boots befitting a surgeon, he trudged into the field. With each genomic ­structure (11 ­different chromosomes with three cop-
whoosh of his pant legs, the mantra reverberated in his mind: ies of each). And yields are consistently high.
“I hope not, I hope not, I hope not.” As a result, Cavendish bananas make up 99% of global
Soon, García-Bastidas saw drooped and flaxen plants. banana exports. In 2022 the Central and South American
Carefully, he peeled back layers of one plant’s pseudostem— countries where the market is concentrated shipped more
44 what laypeople might consider the trunk—until he saw black than 16 million tons overseas. Almost every supermarket
lines running vertically through the vasculature that shuttles banana, regardless of the stickered imprimatur of its brand,
water to growing bananas. “When I saw it,” he recalls, “I said, is a Latin American Cavendish. Americans buy more of them
‘Ah, shit. This is Fusarium.’ ” than any other fruit. Without them, the $25 billion global
The possibility was so alarming that for the two weeks García- banana industry crumbles.
Bastidas spent in Colombia, he was assigned a h ­ andler and Really, there’s only one problem with the Cavendish: It’s
placed on lockdown in his hotel. “I couldn’t talk to anybody, highly susceptible to Tropical Race 4. And that made García-
not even my family,” he says. A test he conducted at a lab in Bastidas’ identification of TR4 in the world’s Cavendish cor-
Bogotá appeared to confirm his assessment. A month later, ridor a potentially dire matter. Almost 8,000 acres across
after double-checking samples sent back to the Netherlands 17 banana farms are now under quarantine in Colombia,
with him by the Colombian government, García-Bastidas knew officially the world’s fourth-most-prolific banana exporter.
for sure: The Grim Reaper of bananas had arrived. That’s only about 6% of the total area where bananas are
grown for export in the country, but the fungus is expected
FOR 40 YEARS, FARMERS, SCIENTISTS AND MAJOR to continue to spread. It’s already in other South American
­ roducers in the industry have watched with growing anxiety
p countries, found in Peru in 2021 and in Venezuela this May.
as the fungus García-Bastidas saw, Fusarium odoratissimum, Ecuador, Costa Rica and Guatemala—Nos. 1, 2 and 3, respec-
or Tropical Race 4, marched through banana plantations in tively, in terms of banana exports—are on high alert.
Southeast Asia. In 2013, García-Bastidas reported finding it After the Colombia discovery, government officials and the
for the first time outside that region, in Jordan. Soon it spilled country’s association of banana growers stepped up efforts
into the banana fields of Africa. at “phytosanitation,” hoping to prevent the fungus from
Fusarium is naturally occurring and typically spreads escaping infected farms. And Dole Plc and Chiquita Brands
when contaminated soil hitches a ride on clothing, shoes International Inc., the largest companies in the banana busi-
or vehicles. In a banana field it burrows into the soil and ness, joined a partnership called the Global Alliance Against
attacks through the roots, quickly invading a plant’s vascu- TR4, which was formed in 2021 to monitor and check the
lar system and choking off the flow of water and nutrients, fungus’ march through Latin America.
rotting it from the inside long before bananas appear. Slice One avenue both companies are exploring is how to increase
open the corm—the bulblike appendage under the soil from the Cavendish’s resilience. But breeding resistance into the
which the pseudostem grows—and the infected plant mate- variety is a dubious proposition: Because it’s seedless, it’s ster-
rial resembles the brittle embers left after a c­ ampfire. And ile, reproducing only via “sucker,” a stalk that grows from the
there are no treatments for this. No preventatives, no cures. corm to replace the adult plant. Eliminating the f­ ungus is also
Bloomberg Businessweek December 4, 2023

near impossible. Fumigating the soil has been tried in other years later, the two attractions that garnered the most attention
infected countries, only to see TR4 repopulate areas thought were the “Big Mike” and Alexander Graham Bell’s telephone.
to be uncontaminated. These challenges have helped push the By 1900, Americans were eating 15 million bunches of Gros
research toward genetic fortification. Michel bananas annually. Three years after that, Fusarium—
In April, Dole planted dozens of genetically engineered specifically Race 1—was discovered in a Panamanian Gros
Cavendish plants in one of its infected banana fields in Colombia. Michel field. Slowly but surely, it wiped out millions of acres
The plants were supplied by Elo Life Systems, a startup in of bananas, along with millions of dollars.
Durham, North Carolina. Some of the plants are genetically By the mid-1960s, United Fruit (now Chiquita) and Standard
edited so the genes required to produce fungus-­fighting ­proteins Fruit (now Dole)—which had rapaciously built dominant posi-
are activated to mount a defense. Others have had proteins from tions in Latin America across the decades, deploying some-
TR4-resistant varieties of banana inserted into their genome, times brutal tactics toward workers and governments alike—had
producing a transgenic fruit. switched from the Gros Michel to the Race 1-resistant Cavendish.
“Banana companies see this fungus as an existential In 1965 the last Gros Michel bananas were sold in the US. The
threat,” says Elo’s chief executive officer, Todd Rands. “We Cavendish wasn’t as sweet or as firm as the Gros Michel, but it
can’t afford to fail.” was the best option available for widespread export.
It may seem short-sighted for the world to rely on a single
THE CAVENDISH IS ITSELF, IN A SENSE, A CHILD OF banana, but monocultural mass-production ensures high yields
Fusarium. It first came to the Western world’s attention around and controllable costs by standardizing growing and harvest-
1826, when British naturalist Charles Telfair obtained several ing methods. That’s how bananas, shipped to far-flung loca-
of the bananas from China. But its dominant position didn’t tions, became a $25 billion industry. “We call it the giant with
begin until well after the modern trade in bananas was estab- the feet of clay,” García-Bastidas says. “It’s such big business,
lished. As Dan Koeppel writes in his 2007 book, Banana: The and it relies on one simple variety.” It wasn’t until the 1980s,
PREVIOUS SPREAD: BANANAS: LAURENT VAUTRIN/DOLE. THIS SPREAD: ILLUSTRATION BY 731. LEAF: PHOTOGRAPH BY MCNAIR EVANS FOR BLOOMBERG BUSINESSWEEK. INFLORESCENCE: ALAMY.

Fate of the Fruit That Changed the World, that trade began in when the Cavendish was planted in Southeast Asia, that its
1870, after an American sea captain returned from Jamaica vulnerability to Tropical Race 4 was identified.
with 160 bunches of a cultivar known as the Gros Michel. It The vast banana estates of Malaysia and Indonesia were
was so novel that, at the Philadelphia Centennial Exhibition six particularly at risk. Yet the response there was muted, even 45

A N AT O M Y O F A C AV E N D I S H P L A N T

LEAF
PSEUDO STEM: JACEK SOPOTNICKI/ALAMY. ROOT: GHEORGHE MINDU/ALAMY

I N F LO R E S C E N C E

P S E U D O ST E M

CORM
Bloomberg Businessweek November 20, 2023

cavalier. Koeppel recounts that one article in Malaysia’s

New Straits Times “portrayed the issue more as a challenge
than a c­ alamity, something the country’s respected scientific
community could easily brush aside.” Meanwhile, banana
plants were dying. One 5,000-acre Fresh Del Monte planta-
tion in Sumatra was hit especially hard. “The reality,” Koeppel
writes of the Southeast Asia TR4 outbreak, “was a total—and
precipitous—wipeout.”
Tropical Race 4 is following the same trajectory as the earlier
Race 1, having leapt across the Pacific to infect Latin America’s
banana fields. But researchers contend that the fungus was
lurking in the soils of Asian banana-­growing regions all along
and merely escaped. And this, García-Bastidas says, is the truly
scary thing. Various strains of Fusarium are distinct forms, not
evolutionary iterations, that have likely existed for millenni-
ums. There’s even a strain known just as Race 4, which infects
stressed or weakened Cavendish plants growing in colder, sub-
tropical environments. All that needed to happen to unleash
TR4—especially pernicious because it infects Cavendish in all
climatic conditions—was for the industry to plant rows and
rows of the same susceptible banana.
By 2016, Dole was already engaged with the Honduran
Foundation for Agricultural Research, trying to identify

46 “WE CALL IT THE GIANT WIT H THE FEET OF CL AY. IT’S SU

banana varieties resistant to the fungus. Five years after that,

the company was citing TR4 as a serious threat in a filing to
the US government, titling one section “Tropical Race 4 may
impose significant costs and losses on our business.” The
next year, Dole wrote, “We may be unable to prevent TR4’s
spread or develop bananas fully resistant to the disease.” The
company declined to comment substantively for this story
but said through a spokesman that “although the TR4 risk is
a concern, Dole is strongly engaged in combating it.” So far,
it’s spent almost $20 million on quarantine and prevention
efforts. It’s also been looking for another way—and that’s why
it began collaborating with Elo Life Systems.

IN JULY I TRAVELED TO DURHAM, WHERE ELO IS

­ orking on its Cavendish genetic-modification project. The com­
w
pany’s headquarters is situated in a suburban business park,
an inconspicuous site with an auspicious history. Elo’s labs are
located in the same building where Mary-Dell Chilton—who, in
the early 1980s, created the first genetically modified crop by
inserting a yeast gene into a tobacco plant—spent decades head-
ing biotechnology research for Syngenta AG. Under Chilton’s
leadership, Syngenta was the first to commercialize Bt corn,
which was genetically modified to express a protein that kills
the larvae of European and southwestern corn borers. For
farmers, it meant no longer having to hose down fields with
gallons of insecticide, though as with all genetically modified
B A N A N A P L A N T S AT E L O L I F E SY S T E M S
foods, it wasn’t without its critics or controversies. To cite one
Bloomberg Businessweek December 4, 2023

example, in 1998 scientists at Cornell University found that

Bt corn ­produced pollen capable of k
­ illing ­the ­caterpillars that
become monarch butterflies, considered an endangered spe-
cies by the International Union for Conservation of Nature.
Rands, Elo Life Systems’ CEO since 2022, refers to the com-
pany’s specialty as “molecular farming”: growing ingredients—
sweeteners, proteins, starches and fl
­ avors—by reconstructing
the existing natural pathways that make these ingredients in
plants. One of its pioneering techniques was to take a genetic
pathway that produces a commercially useful sweetener in
Chinese monk fruit and reproduce it in the genomes of water-
melons, sugar beets and other crops grown in the US.
Matt DiLeo, Elo’s vice president for product development
with a Ph.D. in plant pathology, told me as we began touring
the facility that the company’s work on the Cavendish began
in 2020. Aware of the threat TR4 posed, it reached out to Dole
about forming a partnership. He guided me to a wing that
houses the startup’s growth chambers—sterile white rooms
whose 82F temperature is maintained by long, cylindrical over-
head heat lamps. The air inside was sticky, vicariously trans-
porting me to the Latin American fields where bananas are
grown. Transparent plastic containers, each one bar-coded,
were spread among three shelves along one wall. Sealed inside

CH BIG BU SINES S, AND IT RELIES ON ONE SIMPLE VARIET Y” 47

each was a tiny banana shoot sitting in a chemical medium of

nutrients and hormones to nurture minuscule roots.
These are the modified plants, and Elo propagates many
identical shoots from each one. Some have outside genes
inserted into their DNA; others possess a version of their orig-
inal genome that’s been modified to tell the plant to express
a specific protein. To test whether the baby plants show signs
of resisting TR4, Elo’s scientists remove the shoots, dip them
into a solution of fungal spores and plant them in soil in a sep-
arate growth chamber. “Then it takes 13 days to either kill the
plants or not,” DiLeo said.
The Cavendish contains more than 30,000 genes, exceed-
ing the 20,000 or so found in a human, but Elo’s scientists
are studying only about 100 targets. Some are Cavendish
genes that might be switched on or off to kick-start a disease
response; some are genes from other bananas that might con-
fer resistance. Elo arrived at those targets by identifying dif-
ferences between the Cavendish genome and the genomes of
TR4-resistant bananas and related species, such as plantains.
Find a distinction, and you may find the gene that could pro-
tect the Cavendish. The work took about three years and a
good deal of computational biology.
Fusarium fungal spores are devious, staying dormant until
they detect banana roots. Researchers don’t know exactly how
some banana plants fight off the fungus. According to Elo, it
might be the case that resistant cultivars stop spores by rapidly
generating gels and gums in the opening stages of infection.
LAB COMPONENTS
Cavendish plant growth at Elo Life Systems

E M B RYO E M B RYO S G R OW I N G PETRI DISH COVERED

CLUSTERS INTO SHOOTS WITH TR4

SHOOTS IN A CLUSTER OF S H O OTS R E A DY FO R

GROWTH MEDIUM SHOOTS R O O T G E N E R AT I O N , T H E N
PLANTING IN SOIL
48

These block Fusarium from moving up into the pseudostem, actual banana plants. For genetically edited Cavendish, she
giving the plant enough time to activate fungus-fighting pro- adds enzyme reagents that change the genome inside cells.
teins. Susceptible cultivars such as the Cavendish activate their For transgenic Cavendish, she uses soil bacteria to insert novel
disease responses much more slowly or not at all. banana genes into the cells. The plants that result look like car-
After we finished in the growth chambers, we entered the amel popcorn in their early stages and take anywhere from 6
lab where Jack Wilkinson, Elo’s director of discovery, inves- to 10 months to germinate. They’re transferred to the plastic
tigates how Cavendish plants can confront infection more containers only after tiny leaves emerge.
quickly. “If you can just slow down the fungus, that gives the At the back of the tissue-culture lab are several chambers,
plant a chance to protect itself,” he said. each about the size of an industrial refrigerator. They collec-
The “discovery” in Wilkinson’s title here entails identifying tively contain about 450 banana plants with various combina-
the right antifungal material. He previously worked for Calgene tions of genetic material, some growing in petri dishes, others
Inc., the company that designed the Flavr Savr tomato, the first growing as tiny shoots inside plastic containers. The hope is
transgenic, commercially grown food deemed safe for human that at least one will survive soil saturated with TR4.
consumption by the US Food and Drug Administration. Using “Most people have no idea that the bananas they eat every
modified yeast, Wilkinson grows banana genes in small cell-­ day are on the verge of extinction,” Frazier-Douglas said.
culture plates until they start expressing antifungal proteins. “I want my kids to enjoy bananas the way I enjoyed bananas.”
Once he’s developed a batch of different proteins, he isolates
them from the yeast and dumps them into other plates con- OTHERS ARE ATTEMPTING TO ACCOMPLISH THE SAME
taining Fusarium spores. feat as Elo. James Dale, head of the Banana Biotechnology
Wilkinson showed me a petri dish filled with antifungal Program at Queensland University of Technology in Brisbane,
proteins and little black dots—TR4 spores sitting quietly, doing Australia, is a leader in M. cavendishii metamorphosis. His
nothing. Their inactivity meant the proteins were successfully achievements include making one of the world’s first geneti-
inhibiting Fusarium growth. If they weren’t working, the spores cally transformed Cavendish bananas in 1994. (Neither you nor
would have been proliferating in long black strands. anyone else is already eating a genetically modified banana;
Proteins that stop or slow Fusarium in the petri dish are Dale did this for research purposes only, after TR4 jumped
sent to tissue culture, a lab directly across from Wilkinson’s the water and began decimating Australia’s Cavendish crop.)
and the next stop on my tour. This is where Taylor Frazier- “The outbreak in South America has absolutely changed the
Douglas, lead scientist of Elo’s banana program, creates the ­environment,” he says. “People maybe really will need a genetically
Bloomberg Businessweek December 4, 2023

modified banana if we’re going to keep growing the Cavendish.” to f­ acilitate t­ ransportation and a ripening profile that keeps
Dale’s new Cavendish, dubbed QCAV-4, contains a gene from it from spoiling before reaching its destination. “That’s a big
a wild Southeast Asian banana. It switches on systemic resis- ask,” Dale says. “There are certainly bananas that have been
tance in the Cavendish, so that, even if Fusarium invades the bred conventionally that do have disease resistance and some
plant, it doesn’t do any damage to the fruit. In field trials, Dale of those characteristics, but I’ve not seen anything close to
says QCAV-4 has a survival rate greater than 90%. Australian a Cavendish coming out of any of the breeding programs.”
authorities are currently evaluating it and expect to make a This doesn’t mean the approach is hopeless. In the
ruling about its safety in April 2024. If QCAV-4 gets the OK, it 1980s, Brazilian researchers developed a Fusarium-resistant
would be, as far as Dale knows, the first genetically modified banana—it just tasted more like “an apple or unripe pear,”
banana approved for consumption. From there, he says, he’ll Koeppel writes in his book. And this year, Chiquita, which
conduct more field trials in different environments. didn’t respond to a request for comment, announced a part-
If there’s one reason banana lovers—consumers, com­ nership with university researchers in Wageningen. Led by
panies and fruit scientists alike—can feel optimistic about García-Bastidas, the project is seeking to produce a TR4-
the fight, it’s the contrast with the lax response to Race 1’s resistant banana that tastes like the Cavendish, as well as
charge into the Western Hemisphere. The Gros Michel was new cultivars resistant to a variety of diseases. A first test
eventually ravaged in part because the problem was pushed batch of bananas was recently planted in the Philippines.
off instead of met head-on, with growers ignoring the fun- Until an alternative can be found, whether genetically
gus and simply o ­ pening up new fields for cultivation. This modified or not, countries are doing what they can to con-
time everyone is being much more aggressive. “The import- tain the spread. Colombia’s Ministry of Agriculture and Rural
ant thing is that one of us is successful, because this fruit is Development, working in tandem with the Association of
so important to so many people,” DiLeo says. Banana Growers of Colombia, has invested almost $5 mil-
The potential catch is the use of gene-altering technology. lion since 2019 on various sanitation and containment proj-
Whether consumers would accept genetically modified bananas ects. They include the construction of washing stations at
is uncertain. Dole concedes in its 2022 disclosure forms that plantations to clean soil off transport trucks, purchasing
shoppers and governments might view them ­unfavorably. about 42,000 liters of disinfectant to clean equipment and
“It is possible that new restrictions on GMO products will installing more than 1,300 miles of wire fencing to enclose 49
be imposed in major territories for some of our p ­ roducts or stricken banana plants. These are important, if probably
that our customers will decide to purchase fewer GMO prod- insufficient, steps. “What we’ve learned over and over in
ucts or not buy GMO products at all,” the company wrote. the history of plant diseases is that even when you have
One paper published in 2018, not even a year before García- these huge quarantine efforts, it buys you time, but not a
Bastidas found TR4 in Colombia, noted that although 88% lot,” Elo’s DiLeo told me.
of scientists think genetically modified foods are safe, only Toward the end of my tour of the company’s Durham
37% of Americans agree. The US passed federal legislation in offices, he brought me to its 5,000-square-foot research
2022 requiring that the terms “­ bio­engineered” or “derived greenhouse, on the other side of the business park. Some of
from bioengineering” be printed on the labels of foods with the space is reserved for the watermelons and sugar beets
genetically modified ingredients, and the European Union Elo is using to produce monk fruit sweetener. About a fifth
has strict regulations governing genetically modified crops. is for the new lines of Cavendish bananas. Shoots that sur-
Both regions import huge numbers of Cavendish bananas. vive the initial 13-day test are discarded, but genetic cop-
If people want to keep eating them, though, we may not ies of them are eventually potted in the greenhouse. After
have a choice. “We’ve hit the limit,” DiLeo says. “The only they’ve grown for about two months, they’re hit with what
way that we’re going to solve this is if we use biotechnology.” would normally be a lethal dose of Tropical Race 4—more
than they’d encounter in the field.
FOR ALL THAT GENETIC MODIFICATION PROMISES, As DiLeo and I walked through the greenhouse, I saw row
other scientists working on the South American TR4 out- after row of Cavendish that had been subjected to the fun-
break see a case for diversification instead. “I know peo- gus, about 100 plants in all. Some were wilted and black—
ple are used to eating Cavendish, but we need to rethink dead. Interspersed among those, though, were others still in
the overall banana production system,” says Miguel Dita, a the fight. It was too soon to tell if they’d make it six months,
plant pathologist in Colombia for the Alliance of Bioversity or nine months, or beyond a year—never mind thriving at
International and the International Center for Tropical scale, gaining regulatory approval or reaching consumers.
Agriculture. But their pseudostems were still intact. Each plant’s blades
Dita acknowledges that developing a banana with simi- were a lush, verdant green. Their leaves, far from drooping,
lar qualities to the Cavendish through conventional breed- drank in the sunlight. And as early as next year, the bananas
ing is “quite difficult.” If a new banana were to assume the hanging in bunches could be the mighty Cavendish, unmis-
mantle, it would have to be disease-resistant, high-­yielding takable in all aspects save for one: a newfound resilience
and p­ alatable to billions of people, with skin thick enough against a ­fungal invader. <BW>
A
SPREADSHEET

50

FOR
SHOOTINGS
The Gun Violence Archive obsessively By Madison Muller
tracks deaths and injuries in the US,
but that dedication comes at a cost
Illustration by Yoshi Sodeoka
Bloomberg Businessweek December 4, 2023

D
an Kois was a new one it used previously, but so far police you missed one,” he emailed the team.
­e ditor at the online departments have been slow to transi- Bryant and the editors at Slate went
p u b l i c a t i o n Slate tion. One-third submitted no crime data back and forth until, inevitably, it made
when the mass shoot- of any kind in 2021. To “resume pro- sense that they join forces.
ing at Sandy Hook viding nationally representative data” A year after Newtown, Bryant
Elementary School in Newtown, in 2022, the FBI said it would accept and the team had tallied more than
Connecticut, happened in late 2012. summary reports from departments 11,400 deaths. But that number was a
Twenty of the victims were 6- and that haven’t transitioned. And there drastic undercount. Slate’s research-
7-year-olds. Kois, who has a child who have long been NRA-backed policies ers lacked the time and resources to be
was then about the same age, says, restricting how the Bureau of Alcohol, more c­ omprehensive and, eventually,
“It really freaked me out.” A data jour- Tobacco, Firearms and Explosives can to keep the project going. But Bryant
nalist by trade, he went looking for store and publicly release data, too. wouldn’t give it up.
numbers about gun violence in the Kois thought that by crowdsourc- Today, what was rebranded as the
US but “kept running into a bunch of ing information about shootings, his Gun Violence Archive is the US’s sole
brick walls, different numbers in differ- Slate team could come up with a more repository of near-real-time data on
ent states, and different numbers that accurate real-time picture of US gun shootings. Incidents can be sorted by
seemed shockingly old and out of date.” violence. They began by asking social deaths or injuries, the age of victims,
Tens of thousands of shootings media users to flag shootings that they a shooter’s intent, mass shootings or
take place every year in the US. Some, came across, and emails started to pour geographic location. That’s made it
such as the one on Oct. 25 in Lewiston, in from people looking to help. the go-to source on shootings for the
Maine, get a lot of attention because of A guy in Lexington, Kentucky, media, academics and politicians.
high casualty and injury figures and an named Mark Bryant was particularly Tracking, logging and verifying
ensuing manhunt; others, like the one engaged. Before retiring in his early 50s, every shooting in the US is daunting. It
the next day that left five people dead in Bryant had worked for companies such requires an obsessive attention to detail,
Clinton, North Carolina, don’t. And yet as Microsoft Corp. and International a knack for statistics and a willingness
regardless of how sensational the epi- Business Machines Corp., where he to drop everything at a moment’s notice 51
sodes are, no one federal agency keeps was a computer systems architect. In whenever there’s a mass shooting. The
track of them. Data is siloed, which late 2011, a 36-inch-long blood clot that GVA defines one as having a minimum
makes it difficult to study a ­public-health could have put him at risk for more seri- of four victims shot—either injured or
crisis that kills more kids annually than ous issues such as pulmonary embolism killed—not including a shooter, and
cancer, drug overdoses or car accidents. or stroke landed him in intensive care. there were 619 this year as of Nov. 27,
This lack of transparency isn’t unin- When he got out of the hospital, he by its count. No one’s been more
tentional. The National Rifle Association says, he felt like he was given a second obsessive than Bryant has in compil-
successfully lobbied lawmakers to pass chance. “I have one more good gig left ing all that trauma. It’s taking a physi-
a provision in annual appropriations in me,” he thought. “It’s gotta be good, cal and mental toll.
legislation that for years prevented US and it’s gotta be right.”

T
health agencies from collecting data Eight months later there was a mass his year there have
on shootings. The Centers for Disease shooting at a movie theater in Aurora, b e e n m o re t h a n
Control and Prevention, for example, Colorado. Horrified by what happened, 72,000 shootings in
doesn’t have a guaranteed earmark and annoyed generally at the politics which someone was
from Congress to study gun violence around the issue, he went online for injured or killed,
in the same way it does other causes of answers—and was still looking when according to the GVA. Each of them
death; in 2021 the agency got $25 mil- Sandy Hook happened. was identified and logged by one of
lion for this purpose, but it has to split How many kids die annually from 27 employees, who work remotely and
that money with the National Institutes gunshot wounds? Bryant wanted to whose ages range from 22 to 71. They
of Health. What information the CDC know. In the wake of Sandy Hook, NRA start around 7 a.m., and some keep
does gather can take six months or lon- Chief Executive Officer Wayne LaPierre ­working until 2 or 3 a.m. “It’s an addic-
ger to analyze. Its data collection sys- had introduced the (now oft-repeated) tion,” Bryant says.
tems aren’t equipped to track injuries. phrase that “the only way to stop a bad The workers divvy up the coun-
For its part, the Federal Bureau guy with a gun is a good guy with a try by region. Some monitor a hand-
of Investigation collects data on fire- gun.” How often did that happen? The ful of states; others are focused on
arms used in murders, robberies and answers weren’t easy to find. Eventually Chicago, Los Angeles and other hot
­aggravated assaults. It moved recently Bryant came across Slate’s p ­ roject and spots. They trawl local news sites, social
to a new crime-tracking system that started comparing his research with media, crime-tracker blogs, police
allows for more granular data than the theirs. He noticed discrepancies. “Hey, reports and more, going through
Bloomberg Businessweek December 4, 2023

but he says it captured only about 45%.

“The best way is eyeballs,” he says.
Bryant is now 68, and his white,
bushy beard and horn-rimmed glasses
give him a strong resemblance to Santa
Claus. He grew up in Harlan, Kentucky,
an Appalachian town that was once
part of the state’s formerly thriving coal
industry. Before he started the GVA, he
toyed with using his background in
computer systems to teach coal miners
tech skills to help them transition into
other jobs. Today he lives with his wife,
Sharon, and their three cats.
Given Bryant’s dedication to under-
standing gun violence, one might think
he’d been personally affected by it. But
he says he hasn’t been, and drawing
him out on the emotional sides of the
gun control debate is difficult. What
drives him, he says, is a desire to force
all parties to adhere to the same num-
bers. Before the GVA, gun violence data
was so spotty that politicians and orga-
nizations on both sides could loosely
52 cite any statistic that helped advance
their agenda, with nothing to check it
against. His initial hope was that trust-
worthy figures would move the US past
its political divides on the issue. He now
realizes how “unbearably naive” that
was: “I thought that facts mattered. I’ve
now watched an entire decade of his-
tory, science and facts be vilified.”
The NRA has painted Bryant as a
gun control advocate. In February the
NRA’s LaPierre called Bryant an “anti-
Bryant gun zealot” in an op-ed that also took
aim at the CDC. Bryant says he gets
about 6,000 reports daily. Several the shooter’s intent, which addresses threatening emails at least once a week
areas require more attention than oth- whether it was accidental or purpose- from people he doesn’t know. Even life-
ers, and not only because of the vol- ful or done in committing a crime or long friends, he says, fear he’s working
ume of shootings. Police departments in self-defense. for the government and wants to take
log ­information differently. They’re not On Saturday and Sunday they away their guns. Some of them reach
PHOTOGRAPH BY STACY KRANITZ FOR BLOOMBERG BUSINESSWEEK

always thorough: In many cities, police team up to keep an eye on Baltimore, out on Facebook; others tell him in per-
don’t even report nonfatal injuries. It Chicago, Philadelphia and other places son that they “don’t know what’s gotten
takes much more effort to keep track that tend to see the most violence over into him.” One friend since kinder­
of what’s h­ appening in LA, which has a the weekend. For the same reason, garten is married to a ­conceal-carry
police department that doesn’t separate certain holidays, such as the Fourth of trainer. They made a rule 10 years ago
shootings from hundreds of other daily July, are all-hands-on-deck days. Until not to talk about guns for the sake of
reports, than in Chicago, where there are recently, when he brought on more the friendship. Recently he didn’t get
more shootings but cops maintain a gun staff, Bryant was working 18-hour days. invited to his 50th high school reunion,
violence dashboard. Bryant makes sure He’s tried using technology such as arti- and he worries that when he dies,
that every entry in the database details ficial intelligence to help scrape the Sharon will need to pay people to be
who was shot, how old they were and internet for information on shootings, pallbearers at the funeral. Several GVA
Bloomberg Businessweek December 4, 2023

employees declined to speak to who studies gun violence at Columbia when it started. Now it needs about
Bloomberg Businessweek for fear that University’s Mailman School of Public $800,000 annually, Klein says. The
it would make them targets of the NRA Health, was the lead author of a paper organization was recently awarded
or its supporters. published in June that urged some a $250,000 MacArthur Foundation
­c aution regarding granular examina- grant. But the reality, Klein and Bryant

B
y Bryant’s own admis- tions of GVA data; the study looked at the acknowledge, is that they need to fig-
sion, the GVA’s data GVA’s work in four cities over a five-year ure out how to secure long-term fund-
isn’t always uniformly period (­2015-20) and determined that ing and how to provide leadership for
robust. The organi- it caught 81.1% of what Gobaud’s team the GVA for the future.
zation collects more called “community firearm violence Bryant is usually quick to pick up
data on kids and firearms than on any shooting events.” “There’s a tendency the phone, but it’s been harder to reach
other types of shootings. There’s infor- for us to use the data and not really him recently. His health has started
mation on both fatal and nonfatal think through” what potential biases to deteriorate, the result of a lack of
shootings for kids (and, separately, for might be inherent in it, Gobaud says. sleep and few, if any, breaks over the
teens). It notes which were accidental Race and ethnicity data are excluded past decade. He all but disappeared in
and which occurred on school grounds by design. Michael Klein, the 81-year-old August because of an infection that,
when students were present. Bryant billionaire chairman and co-founder of at its worst, he says, knocked him out
makes a mental note of kids who were CoStar Group Inc., a real estate informa- cold for almost 24 hours. “You’re not
accidentally shot by a parent’s firearm tion company, is the GVA’s sole source of 18 anymore,” his doctor scrawled on a
that hadn’t been properly stored—this, funding. Klein also stumbled on Slate’s prescription pad during one of many
to him, is a particularly heinous expres- project after Sandy Hook; he had no recent visits.
sion of gun violence. The team goes financial ties to organizations on either The health setbacks have forced
through the data several times a day to side of the gun debate and saw a need for him to slow down. He’s hiring more
check for errors. “There’s nothing worse more data, too. Klein and Bryant with- staff, including an assistant. (The goal
than me getting a call six months later hold race and ethnicity data because of is to add three more employees to get
from a mother whose kid got killed tell- a worry that gun rights advocates and to 30.) He never thought the GVA would 53
ing me we spelled the name wrong,” the NRA would use it to downplay the be around for this long, he says, but
Bryant says. scope of gun violence and say it’s mostly now he’s reckoning with the reality
Data on suicides is next to impos- an issue affecting Black communities. that it may still be needed for years to
sible to include in real time. Police They want to remain as non­ come. “We’re ­succession-planning,” he

“I thought that facts mattered. I’ve now watched an entire

decade of history, science and facts be vilified”

departments don’t typically report partisan as possible. “We do stats, not says. He and Sharon are also ­thinking
­suicide data because it’s not crime-­ ­ dvocacy,” Bryant says. And though he
a about taking a vacation, perhaps to
related. Coroners don’t usually release says he’s “not even remotely for ban- Cambridge, England, where they
information about suicides unless a ning weapons,” he wants to see pol- can cruise along the canals. “It just
case receives a lot of public interest. icies enacted that could help reduce seems like the most peaceful thing
That’s a crucial missing piece of the deaths, such as the safe-storage require- in the world to do,” he says. More
overall picture of gun violence, because ments and child-access-prevention immediately, he’ll settle for a beach:
suicides account for more than half of laws that public-health experts have “The s­ econd my feet hit the sand, I’ll
all fi
­ rearm deaths, and more than half widely endorsed. Only a handful of be beating myself up for not doing
of all ­suicides involve a firearm. states have these p
­ olicies in place, and this earlier.” <BW>
And the GVA doesn’t include there are no rules at the federal level.
­information on race and ethnicity, even Klein says, “We haven’t accomplished Michael Bloomberg, founder and major-
though Black Americans experience dis- what we hoped, which is to have some ity owner of Bloomberg Businessweek
proportionate rates of gun violence, and impact on policy.” parent Bloomberg LP, also founded
the majority of mass shooting victims That hasn’t dissuaded him. The Everytown for Gun Safety, which advo-
are Black. Ariana Gobaud, a researcher GVA cost about $250,000 to run cates gun-safety measures.
P
Clockwise from top: Robiola d’Alba
al Tartufo, Uplands Cheese Rush
Creek Reserve, Fromagerie L’Amuse

t
Brabander Reserve, Vacherousse

e r ai nin U
d’Argental, Linedeline

nt
t E g R
S
Instan

U
I
T
S 55

59
A better buffet

60
How to throw the easiest, Panama City’s
fresh flow
most fabulous
62
holiday shindig. In Maestro, Cooper
(Hint: It starts with cheese) captures the composer

By Kate Krader Photograph 63

A faster, smarter
by David Chow wine cooler

December 4, 2023

Edited by
Chris Rovzar

Businessweek.com
HOLIDAY ENTERTAINING SPECIAL Bloomberg Pursuits December 4, 2023

If there’s one guest you want to invite to a party, it’s cheese. Raymond Hook, who co-owns the fromagerie Capella Cheese
The sumptuous dairy product isn’t demanding—­generally it in Atlanta, calls it an “elegant, creamy master­p iece.”
just needs to come to room temperature and land on a nice Another fan is Jamie Nessel, director of product and pur-
cutting board. You can dress it up with dried or fresh fruit chasing at Bi-Rite Market in San Francisco. “This holiday,
and a wedge of the Spanish quince paste membrillo, or it like every year, you’re probably going to see tons of gor-
can arrive unadorned. geous cheeseboards, baked brie and cheese ball recipes
“It’s easy to curate and a beautiful conversation starter,” take over social media,” she says. “While those are cer-
says Tess McNamara, head of salumi and formaggi at Eataly tainly delicious options, at Bi-Rite we’re obsessed with the
North America, the Italian market that has stores around incredibly rich, deep flavor of simply warming the seasonal
the world. “Put it out, and all of a sudden a crowd gathers.” Rush Creek Reserve.” (Specifically, it can be heated in a low
Take the Uplands Cheese Rush Creek Reserve, a salty, oven for about half an hour, until it’s soft and warm. Serve
woodsy cow’s milk cheese that’s so soft it could double as with spoons.)
a voluptuous dip. It’s this season’s “it” cheese, according to Here’s what you need to know about this cheese and four
an unofficial survey of five top cheese p ­ urveyors in the US. others—plus a raft of other secret weapons for an instant party.

Rule No. 1: Get a Wedge With an Edge

Uplands Cheese Rush Creek Reserve which broadens the wine’s pear, herbs and truffles. As a fruit- and floral-scented Arneis
The only time to get it is around the lemon-zest taste with a slight bitterness and from Piedmont, it has the right combo of
holidays, after it’s produced from cows that contrasts the cheese’s tangy flavors. fresh acidity and full body to complement
have been snacking on dry fall hay. The large the cheese’s creaminess.
round has a soft white rind and is wrapped in Vacherousse d’Argental
a strip of spruce bark. Its incredibly creamy A holiday favorite of Dominick DiBartolomeo, Fromagerie L’Amuse Brabander Reserve
center—the Wisconsin-based producers president of the Cheese Store of Beverly Golden Brabander cheese is generally
refer to it as savory custard—has a smoky- Hills, this lush cow’s milk cheese from aged for eight months. The reserve goat
sweet milky flavor. They recommend France has an exceptionally smooth center gouda, made from the pasteurized milk of
56 that overflows its orange-tinged rind. Saanen goats in southern Holland, is aged
that you heat it slightly before serving to
increase the oozy factor. (See above.) Why: “You can pair it with some great bubbly for 16 months so the sweet, nutty cheese is
Why: “The perfect holiday cheese,” says or a nice festive cocktail,” DiBartolomeo stocked with compelling textural crystals.
Hook from Capella Cheese. “It’s seasonal says. “It’s also perfect if you pour over some Why: “A holiday centerpiece,” says Bi-Rite’s
and festive and loved by everyone who seasonal jam or chutney, and incredibly Nessel. “It’s an extra-aged goat gouda that’s
tastes it—if you can find it.” decadent if you top them with some caviar.” really dense and fudgy, balanced by notes of
Pair it with: Domaine Marquis d’Angerville Pair it with: Domaines Schlumberger Riesling brown butter and caramel.”
Volnay Fremiets 2011 ($170). An elegant, Les Princes Abbés 2020 ($29). The maker Pair it with: Remelluri Rioja Reserva 2015
aged Burgundy is ideal if you’re serving the of this gooey-soft cheese suggests ($50). A bold but mellow red such as this
cheese course French-style, after dinner. serving a fruity riesling for contrast. This rioja is a top match for the intensity of the
This silky red has complex, damp-earth bottling, from Alsace, is a bright refresher golden, aged cheese, particularly at the end
nuances that match the cheese, with enough with sharp acidity and yellow apple, of a meal. The vintage’s elegant deep fruit
acidity to contrast its richness. lemon and ginger notes. It also has a rich and hints of smoke and leather highlight
mouthfeel to stand up to the cheese’s the nutty, gamy flavors; its velvety character
Linedeline buttery texture. contrasts with the cheese’s crunchy texture.
This goat’s milk cheese has a layer of
PREVIOUS PAGE: FOOD STYLING BY YOUNG GUN LEE. THIS SPREAD: COURTESY COMPANIES
ash and a creamy, slightly citrusy filling. Robiola d’Alba al Tartufo THE ONE WINE THAT GOES WITH
Its fans include McNamara from Eataly Laced with bits of truffle and then PRETTY MUCH ANY CHEESE
North America, who hails Wisconsin-based festooned with additional slices, NV Champagne Bollinger Special
producer Veronica Pedraza as “one of the the soft cow’s milk cheese from Cuvée Brut
best cheesemakers the USA has known.” Italy’s northern Alba region has no Champagne is the best overall choice
Why: “It’s everything you want in a holiday problem going over the top. Julia to pair with cheese, especially when
showstopper,” McNamara says. “Decadent, Hallman, owner of Formaggio it’s an hors d’oeuvre. The bubbles
dashing, nuanced and equal parts sweet— Kitchen in Boston, loves its and bracing acidity of the wine cut
butter, fresh, cream—and savory—grassy, buttery flavor. the decadent creaminess and rich,
bright, hint of fresh chives. Not to mention it Why: “Nothing says the holidays salty flavors. This particular brut has
looks like a cake and is ready to celebrate.” like truffle cheese, and this one refreshing, crisp apple notes and the
Pair it with: Domaine Philippe Tessier makes a great centerpiece to a earthy nuances that go especially
Cheverny blanc 2022 ($25). Sauvignon blanc spread,” Hallman says. well with tangy, savory, soft
is the classic pairing with goat cheese, but Pair it with: Bruno Giacosa examples with a rind. Then again,
try Loire Cheverny blanc with this ash- Roero Arneis 2021 ($38). This it works well with hard, salty, aged
ripened wheel. Its lively sauvignon-dominant Italian white won’t overpower cheeses such as Parmesan. $70
blend includes chardonnay as well as orbois, the delicate flavor of the black —Kate Krader and Elin McCoy
HOLIDAY ENTERTAINING SPECIAL Bloomberg Pursuits December 4, 2023

The Simplest Cocktails Come Premixed

Tip Top Boulevardier is attractive enough to gift. Pour the tequila-
This small but potent bubbles mix into a highball glass over ice and
limited-edition serve with a straw. $23 for 750ml bottle
boulevardier was
developed by Miles Tanqueray Negroni Cocktail
Macquarrie, the Beyond the gin and red bitters backbone,
bar master behind this variation surprises with a hint of holiday
Atlanta’s Kimball spice. Divide each 375ml bottle among four
House. Pour into friends. (Although the label suggests eight
a rocks glass over 1½-ounce servings, don’t skimp—pour your
a large ice cube besties a double!) from $14 for 375ml bottle
and garnish
with orange or Ghia Le Spritz Sumac & Chili
Thomas grapefruit peel. Among the vanguard of nonalcoholic
Ashbourne $40 for eight-pack of alternatives is the latest from Ghia, which
Espresso Martini 100ml cans some liken to a spicy margarita. It’s tart,
All you need to fruity and fiery; you can pour it over
serve this ready-to-drink, hazelnut- and Delola Paloma Rosa Spritz ice straight from the can or mix it with
chocolate-tinged delight is to shake it well Paloma, meet spritz. In this offering from sparkling water to soften the assertive
with ice to encourage a foamy top to form. actress-pop star Jennifer Lopez and bar pro flavor. $48 for 12-pack of 8-oz cans
$20 for four-pack of 200ml cans Lynnette Marrero, the decorative bottle alone —Kara Newman

Open a Box and Presto—Party!

57
The Traveler Caviar Set
One of the top-quality purveyors in the US,
Tsar Nicoulai Caviar sources these half-
ounce jars of osetra, lustrous golden osetra
and baerii caviar from its partner farm in
Greece. They come with a mother-of-pearl
spoon, Bellwether Farms crème fraîche and
blinis. $229

Dandelion’s Luxe Hot Chocolate Trio

Dandelion’s house hot chocolate—an almost
decade-long fixture in the San Francisco
cafe—has a rich, 70% Ecuadorian cacao base
that’s sweetened with organic cane sugar.
Gingerbread adds cinnamon and nutmeg;
mocha has a dash of local roaster Ritual’s
instant coffee. $65 for three 5.6-oz packages

Ami Ami’s Mulled Wine Kit

With bold labels inspired by vintage
Campari ads, the new boxed-wine
company Ami Ami teamed with
prized-spice peddler Burlap & Barrel
for this mulled-wine pack. Warm
up the house vin rouge with single-origin
Wagyu and Champagne Party Kit Bemelmans Bar Martini Box East African cloves and black peppercorns.
Online butcher Meat N’ Bone pairs 10 oz of New York City’s most famous piano lounge $38 for 1.5 liters
Japan’s treasured A5 buttery wagyu beef knows a thing or two about martinis—the red-
ribeye and an 8-oz filet mignon medallion jacketed bartenders there mix 1,000 a night. Hot Pot Party Kit
with a festive bottle of Moët & Chandon This do-it-yourself kit is equipped with two of Online Asian market Umamicart has pulled
Impérial Brut Champagne. Bonus: The set the bar’s thin-lipped, etched martini glasses, together an assortment of shelf-stable
comes with a 10-inch cast-iron skillet from along with a jigger, a strainer, a stirrer, picks, a ingredients to make this mouth-numbing
Victoria Cookware. $353 mixing glass, napkins and a recipe. $395 hot pot kit for 6 to 10 guests. Soup bases
HOLIDAY ENTERTAINING SPECIAL Bloomberg Pursuits December 4, 2023

for the Chinese cold-weather staple Nashville bakery can be shipped nationwide American brand MìLà arrive ready to cook
contain tomato and Sichuan peppercorns, and are designed for parties of as many as with three regional Chinese noodle kits:
with condiments such as chili-spiked 10 guests. Each set comes with two dozen Sichuan dan dan, Shanghai scallion oil, and
fermented soybeans and toasted sesame 1-inch, ready-to-bake mini biscuits, plus 8 oz Beijing sweet and savory. The set includes a
oil. $65 of glorious seasonal brown sugar cinnamon bamboo steamer basket, plus two bowls and
butter. $90 chopstick sets, and three condiments: ginger-
Biscuit Love’s Brekkie Biscuits scallion oil, spicy chili crunch and the all-
The textbook-perfect flaky, creamy biscuits MìLà’s Soup Dumpling Set important soy-vinegar dumpling sauce. $160
(and incredible cinnamon rolls) from this These 50 pork soup dumplings from Asian —Kat Odell

Old-Fashioned Games Have Staying

Power—for a Reason
box, you must be able to understand it by “But people often just keep playing,” Levin
reading the back—not a lengthy manual. says. “And that’s the other sign of a really
And no round should last longer than good party game.”
15 minutes. If your party’s so last-minute you can’t
Quick-reaction games get the count on overnight shipping, stay away
energy up: Levin champions Taco Cat from Charades or Celebrity, which can get
Goat Cheese Pizza ($11), where players competitive. Instead, opt for something silly
must say one of those five words as they that no one is good at, says event planner
flip a card from their stack. If the image Jennifer Oz LeRoy. “You can MacGyver this
on the card matches the word, the last party with a Candy Cane Olympics,” she
player to slap the central pile must take says. Buy some big bags of candy canes,
all the cards that have been drawn so far. and set up games throughout the house.
58 The goal is to be the first to run out of cards. Arrange a set of bowls down the hallway,
From Levin’s own portfolio, start with marking each with a point score; guests
Tag Someone Who ($20), which owes a then have 10 canes apiece to throw, trying
debt to Truth or Dare and Cards Against to land in the bowls to get the highest
Peter Levin loved playing games so much, Humanity, with a Facebook twist. Each score. Hide canes around the house or
he turned it into a career four years ago, card features a question that players must garden, egg-hunt-style, with a prize for
co-founding Hunch Studios, a party-game answer by suggesting another player; for whoever finds the most (and, surprise, the
specialist. He identifies a few key things that example, who’d survive the longest in a prize is shots of schnapps). Or task teams
make a game a party booster rather than a zombie apocalypse? Or who’s most prone with passing a cane or two from person to
pooper: First, a card game is almost always to repeating the same story ad nauseam? person in a set time, using any part of their
better than a board game, as the rules are Whoever receives the most votes keeps the body but their hands. Just don’t tell Santa.
typically simpler. If the game comes in a card. The first person to seven is the winner. —Mark Ellwood

Save a Souvenir This Year

In a world governed by the law of “pics or it the shutter. The Lomo’Instant 2.4-inch-square image in about
didn’t happen,” capturing a party’s best—and Automat Camera and Lenses 12 seconds. You can add messages
preferably most infamous—moments is every South Beach Edition ($199) and augmented-reality-triggering QR
bit as essential as keeping the Champagne has interchangeable fisheye, codes to your pics before printing.
chilled. Standard smartphone shots might wide-angle and close-up lenses. The phone: Nothing dissipates
do the trick for a Sunday brunch, but this is There’s also one for making the holiday spirit faster than
the season to step up your snaps and make a multiple exposures on its asking for a seventh take of
wall of memories in real time. Here are tools Fujifilm Instax mini film. a group picture because yet
to help you do it. The prints: Most again someone had their eyes
The film: You’ll feel a little like Warhol shared pictures quickly closed. Google’s new Pixel 8
when you’re wandering around with a sink into the digital and Pixel 8 Pro phones (from
Polaroid. Load yours with the company’s quicksand of our devices, $699) solve that issue with Best
new i-Type Retinex Edition film ($34), which never to be seen again. Take. After you snap a burst
COURTESY COMPANIES

prints the picture inside a circular frame Fujifilm’s pocket-size Instax of images, it lets you remix
bordered in bright colors. Square Link photo printer the photo, choosing each
The lenses: With instant pictures, ($140) shares snapshots person’s best face in one shot.
creativity has to happen before you snap on the spot, producing a —Matthew Kronsberg
HOLIDAY ENTERTAINING SPECIAL Bloomberg Pursuits December 4, 2023

CHAMPAGNE
Sparkling wine is made for the holidays,
and Richards starts all of his parties with
it. He also recommends stocking a full bar,
including solid nonalcoholic options, not just
a cursory cranberry juice and Coke.

BACON
“You need something sitting on the counter
for people to snack on,” Richards says. He
cooks a couple of packages of bacon until
they’re nicely crisp and sprinkles them with
pepper. The strips, a family favorite, can
be served upright in cups. They go well
with another family go-to: a Southern-style
relish tray, with traditional pickles and dips
augmented by sharp cheddar cheese and
shrimp cocktail.
SOUP
Soups are not only comforting but also
a good buffet option because you can
keep them warm and ladle them out as
needed. And they’re good to have on hand
the next day, if, as Richards puts it, “you’re
like my family and might have had a little
too much to drink.” He puts chili in the soup
category. When he serves his, “I sit back
and wait to hear people talk about their
family recipe.” 59

green ramen with peppered pork belly, FISH

Southern a bestseller.
Richards is culinary director for
Since the start of the pandemic, Richards
says One Flew South customers have been

Comfort
Jackmont Hospitality, a company focused more adventurous in their ordering, and
he’s selling more fish than he used to. He
on elevating the more than $469 billion
likes a big grilled fish on a buffet. It can be
airport quick-service food market. In whole, such as bass or a side of salmon.
2024 it will open 12 more restaurant con- But make sure it’s thick, not a delicate fillet
cepts in airports across the US, and in
The rules of the party February, Richards will publish his first
of sole.

buffet, from a chef who cookbook, Roots, Heart, Soul: The Story, BAKED POTATOES
Richards recommends a do-it-yourself
specializes in soothing Celebration and Recipes of Afro Cuisine
baked potato and sweet potato station to
in America, with co-writer Amy Paige
stressed-out travelers Condon (HarperCollins, $35).
accommodate a variety of diets. The key is
to have lots of accompaniments: bowls of
By Kate Krader “Our No. 1 job at the restaurant is to sour cream, crumbled bacon, maybe some
take the stress out of travel,” Richards vegan sausage, chives, shredded cheese—
“Comfort” isn’t a word commonly says. He brings elements of home and that chili you might also be serving.
linked to airports, especially not ­entertaining to Concourse E, such as CAKE
Hartsfield-Jackson Atlanta International soft cloth napkins, place mats and a wall Pies are indisputably popular for the holidays,
Airport, which in 2022 was the world’s mural that depicts a forest, as if it’s the but Richards is adamant about his preference
busiest, with 93.7 million passengers. view through a kitchen window. for cake at a party. It’s more attention-getting,
But some travelers head over to We asked Richards, who knows for one. Pound cake, which you can bake or
Concourse E—even planning extra-long harried diners better than almost any- buy, is versatile, a key to success on a buffet
ILLUSTRATION BY TARN SUSUMPOW

layovers—to seek out exactly that. They one, for the key to throwing a party. table. Serve it with berries or poached fruit
if you want to be seasonal. Pile it high with
sit down at chef Todd Richards’ restau- His ­secret? Serve dinner buffet-style
whipped cream, ice cream, syrup—the works.
rant One Flew South, where homey so guests with many different arrival But, Richards says, you can take it in a more
dishes arrive with warmly spiced and departure times will always find a over-the-top direction by toasting it in the
twists: nourishing cauliflower soup with groaning table. Here are six staples he bacon fat left over from your snacks and then
curry and crispy chickpeas or collard says every holiday buffet should have. drizzling it with maple syrup.
TRAVEL Bloomberg Pursuits December 4, 2023

Hotel La Compañia is in
the heart of Panama City’s
Unesco-designated old town,
or Casco Viejo. Part of Hyatt
Corp.’s exclusive Unbound
Collection, it is Lenz’s pas-
sion project. He stumbled on
Panama a decade ago, on the
way back from sailing around
the world for two years with
his family. A Canadian trans-
plant and trained chef, Lenz
had spent more than 23 years
Casco Viejo in Hong Kong hospitality and
GO HERE NOW intended for Panama to be a
pit stop where his two children could learn Spanish. That

Panama City eventually turned into an ambitious plan to restore and

reimagine an entire block of abandoned ruins—including the
17th century Jesuit convent of La Compañia de Jesus, a uni-
versity and an early 20th century upscale department store—
It’s worth sticking around this port into an 88-room luxury property. It took him eight years.
“All the foreigners coming to Panama to build a hotel
best known for passing through come to me for advice,” Lenz says. “If only half of them
By Lebawit Lily Girma make it, Panama is going to be very different in three years.”
The old town had been in decline, but Casco Viejo is
60 “You see the big stones?” the hotelier Chris Lenz asks, rebounding. A five-minute walk from La Compañia, Accor SA’s
­ ointing excitedly toward basketball-size rocks embedded in
p 159-room Sofitel Legend opened in January in a majestic
a row of arches. “Those are from Panama Viejo. They were in cream-colored colonial building, accented with arched win-
another building in the original city, when Columbus visited.” dows, that sits at the water’s edge. The soaring white-and-
It’s a sweltering Sunday in July, and the restaurant gold interior lobby preserves the glamour of the former
Santuario is buzzing with well-heeled Panamanians brunch- ­members-only Union Club, created by the Panamanian bour-
ing amid restored brick walls and stained glass. But before geoisie on this spot in 1871, where they gathered to shape and
I can eat, Lenz wants to show me his “living museum,” discuss Panamanian politics and culture. Albert Einstein and
a sprawling maze of local history sprinkled across the Eleanor Roosevelt were among its visitors.
three c­ ourtyard-facing wings of his newly opened Hotel While luxury hospitality is growing in the city, tourism
La Compañia. has steadily been building in remote areas, too—albeit a bit
There’s a framed image of Spanish explorer Vasco Núñez under the radar. About an hour’s drive north of my room
de Balboa next to a picture of Panama’s first elected presi- at the Sofitel, the Emberá Tusipono Indigenous community
dent, Manuel Amador Guerrero, which his family donated inside Chagres National Park offers a very different type of
to the hotel. The names of Spanish ships that exiled the tourist experience. The group has occupied this lush pro-
Jesuits and transported enslaved Africans are carved into tected area since the 1970s, when Emberá communities
a mahogany bar. Lining the resettled to escape violence
walls of Lenz’s “hall of fame” in the treacherous jungles on
are autographed portraits of the border with Colombia. In
famous Panamanians—Grammy 1985 they gave up farming and
winner Ruben Blades, Yankees hunting in the area and began
closer Mariano Rivera, polit- welcoming tourists to share
ical analyst Juan Williams. and preserve their crafts, music
There’s even a 1640 statue of and food.
St. Ignatius, the Spanish Jesuit When I arrived, I ­followed
priest who founded Panama’s a rocky pathway along the for-
COURTESY COMPANIES

first university. ested banks of the Chagres

It dawns on me that I know Santuario restaurant River, which feeds the Panama
very little of this country at Hotel La Compañia Canal, and boarded a motor-
beyond its famous canal. ized dugout canoe. A tribe
TRAVEL Bloomberg Pursuits December 4, 2023

Lenz says this

Pesca chombasia at could be why
Maito restaurant
the government
hasn’t focused
on tourism.
In the void,
growing num-
bers of small lux-
The Sofitel Legend ury hotels have
begun creating
member, bare-chested their own image. On my last day, Lenz takes me on a stroll
and wearing a traditional around the corner from Hotel La Compañia and up a block
beaded skirt over a loin- to Villa Ana. His second hospitality project, slated for late
cloth, stood at the front January 2024, won’t be another hotel. It will be much more.
to steer through shallows The restored 11,000-square-feet four-story mansion sits
with a wooden stick until on Casco Viejo’s Independence Square and belonged to a
we reached his village. I wealthy Panamanian family in the mid-20th century. The
spent the day amid thatched-roof houses built on stilts to urban myth, Lenz says, is that the Arias family, ashamed of
withstand floods, eating freshly caught fish fried over an their lesbian daughter, Ana, moved to the modern side of
open fire and served on banana leaves. the city, leaving her locked in the house. In reality, the fam-
The Emberá are one of seven Indigenous tribes that ily turned the ground floor into a bank, which they owned,
reside here, and, with the Pacific and Atlantic only 50 miles while Ana lived upstairs, hosting extravagant parties until
apart, the country is home to one of the world’s most biodi- she died in her 90s. Lenz envisions an art gallery on the
verse habitats. “We have so much that hasn’t been touched,” ground floor; a restaurant, including a rum and cigar lounge,
says David Kianni, general manager at the Sofitel Legend. on the upper levels; and a spacious jazz club in the attic.
He cites the San Blas archipelago’s pristine beaches on His hope, he says, is to create an ecosystem for jet-­ 61
Panama’s Caribbean coast, which are hard to reach and setters, so they’ll choose the old town as a starting point to
have no fine dining, Wi-Fi, or even restrooms. explore the country. Adventure travel—such as hiking, bird-
But Panama lags behind neighboring Costa Rica in touting ing, wildlife spotting and jungle boating—is a niche market,
its ecological riches to international visitors. The country was but it’s growing. “This is Panama’s opportunity,” Lenz says.
stifled by military dictatorships for much of its recent history, “And it’s happening organically, without the government
though its markets and institutions have begun to mature since even being aware.”
the US returned the canal zone at the end of 1999. For $135, I took a 105-minute ferry from the city’s Flamenco
Until recently, most travelers thought of the country as Marina to one of the 200 Pearl Islands, 32 miles off the coast
the site of one of the world’s greatest feats of engineering. of the city. The ride turned into a h ­ umpback-whale-watching
The 50-mile waterway admits as many as 14,000 ships a excursion. Amid passing pods of spinner dolphins, we gasped
year; in 2022 it pumped a record $3.5 billion into the coun- at the sight of the giant mammals breaching in the distance.
try’s economy, according to the Panama Canal Authority. Ours was the only tourist boat there.

WHERE TO STAY band—salsa, when I was there— local chefs boldly celebrating from Chef Mario Castrellón
The Sofitel Legend and Hotel that draws dancing crowds on the nation’s Afro-Caribbean, reflects his “Chombasia”
La Compañia each offer a the weekends. Add a beachside Indian, American, European, concept: a fusion of the Afro
distinct atmosphere in Casco break at one of the latest swanky Chinese and Japanese heritage. and Asian culinary traditions
Viejo. La Compañia’s bustling island resorts that dot Panama’s At Fonda Lo Que Hay, in that shaped Panama’s identity
complex has five restaurants, Bocas del Toro archipelago: Casco Viejo, an open kitchen during the construction of the
including Italian, French and Nayara Bocas del Toro, an hour’s delivers Caribbean-inspired canal. A story comes with each
American steakhouse options, flight and a 15-minute boat ride soul food as diners begin lining dish served: Wonton shrimp
two bars and a rooftop pool. from Panama City, offers respite up at 8 p.m. for plates of tuna dumplings sit atop a blended
The Sofitel Legend’s tranquil in solar-powered, over-the- carpaccio on toasted yucca, sauce of coconut, curry, anise
waterfront vibe permeates its water bungalows flanked by whole fish grilled in banana and molasses. The pesca
spaces; go for a snack with a mangroves and coral. An “aerial leaves or pork belly in a creole chombasia, a grilled whole
skyline view by the infinity pool beach” lets you sun and dip in stew with rice and beans. A white snapper, basks in a curry
or order a soothing herbal bath the ocean from a sandy platform. 20-minute drive east of Casco and vegetable stew, with a
drawn by your suite’s butler. Viejo, Maito clinched a spot side of coconut rice and an
Rooftop bar Ammi, with views WHERE TO EAT on the 100 Best Restaurants optional serving of ají chombo,
of those same skyscrapers lit Panama’s dining scene offers in the World 2023, and it’s Panama’s red-hot, cherry-tinged
up at night, comes alive with a a smorgasbord of flavors, with easy to see why. Each plate pepper sauce.
CRITIC Bloomberg Pursuits December 4, 2023

her career as an actress, but after marrying Bernstein, her

most prominent public appearances were often silent: She
was photographed next to him at galas and concerts and ben-
efits in impeccable designer outfits. Privately, she became a
New York hostess who turned their apartments—a duplex on
Park Avenue, then a palatial spread in the Dakota—into the
center of a glittering social whirl.
Mulligan’s Montealegre enters the marriage cleareyed. She
loves her husband, their milieu and their celebrity—at least
for a time. His gay life, as long as it stays discreet, isn’t a con-
cern, particularly after they have three children.
But discretion isn’t Bernstein’s strong suit. Maestro begins
sunnily enough, in the mold of one of Bernstein’s musicals: His
big break, filling in at Carnegie Hall after the conductor Bruno
Walter comes down with the flu, gives way to his courtship
of Montealegre (or more to the point, her courtship of him).
There’s even a dream dance sequence in black and white.

Bernstein’s Big It becomes a more conventional film—back in color,

­thankfully—once the plot coalesces around the domestic
drama. Despite his affection for her, Bernstein lets his fre-

Close-Up netic work life and frequent affairs wear Montealegre down
as the 1960s give way to the ’70s. The word “darling,” which
she initially murmurs to Bernstein as a term of affection,
is wielded with increasing sarcasm as time goes on. But
In the biopic Maestro, actor-director Mulligan, who’s become a master of depicting intelligent
resilience, ensures that Montealegre never falls into the
62
Bradley Cooper knows the score woman-in-a-gilded-cage trope.
By James Tarmy The movie certainly flirts with it, though. Most of Maestro
occurs in the tasteful solitude of their country house in
The conductor and composer Leonard Bernstein and the Connecticut or in their living room in Manhattan. Cooper,
actress Felicia Montealegre weren’t an obvious match. First, who wrote the script with Josh Singer, captures the intelli-
there was the matter of Bernstein’s incandescent celebrity: gence of the Bernstein family. In times both happy and tense,
By the time they married in 1951, crowds were following the the dialogue is filled with bon mots and quippy asides.
musical wunderkind as he flitted from triumph to triumph. Maestro is particularly enjoyable when it transitions from
Then, there were Bernstein’s gay love affairs, which he barely private to public. Bernstein might be wonderful with his chil-
tried to hide. Their union was, their mutual friend Rosamond dren and funny with his friends, but on the podium—the
Bernier wrote in her memoirs, “the best possible move for movie’s only true public moments—he comes alive. Cooper
him, but not all plain sailing for her.” embedded with multiple orchestras as he researched the role
Those choppy waters are dramatized in the film Maestro, and superbly embodies the conductor’s famous physicality.
directed by and starring Bradley Cooper as Bernstein. It hit Various scenes in concert halls showcase the joyous, histrionic
theaters on Nov. 22 and streams on Netflix starting Dec. 20. gestures that helped make Bernstein a cultural icon.
Cooper had ample reference material for the role. As music The movie’s score is primarily music composed by
director of the New York Philharmonic, Bernstein embraced Bernstein, and it’s particularly effective. There are tense
television early and enthusiastically; his young peoples’ con- snatches of West Side Story as Bernstein brings home a young
certs, where he would explain the thrill of a piece of music in man named Tommy Cothran (Gideon Glick); we hear his tur-
lucid terms children could understand, were seen by millions. gid Mass as Montealegre begins to perceive of Cothran as a
If that wasn’t enough, he composed scores for a series of real threat to their marriage.
hit musicals, most notably West Side Story, which broadened The entirety of Maestro, in fact, hews closely to real events.
his reputation beyond so-called high art. Chatty and glamor- But despite a few bits of expository dialogue here and there,
ous, Bernstein was friends with royalty, celebrities and presi- the movie is content to be impressionistic, a series of vignettes
JASON MCDONALD/NETFLIX

dents. Much has been made of Cooper’s prosthetic nose, but strung together. It might help viewers to know the many real-
on screen the likeness is uncanny; adding to the fidelity is his life people and historical references introduced without any
singsong voice with a midcentury His Girl Friday inflection. explanation, but to a large degree, these details are beside
Montealegre, who’s played in Maestro by an excellent the point. Maestro, at its essence, is the story of a couple who
Carey Mulligan, is less of a known quantity. True, she began traded a Hollywood ending for a life among the stars. <BW>
THE ONE Bloomberg Pursuits December 4, 2023

Chilled at Warp Speed

With the QelviQ Personal Sommelier, getting wine to the right temperature—
and keeping it there—has never been so convenient. By Elin McCoy
Photograph by Janelle Jones

Consider this: You’re primed to enjoy a superb

bottle of wine over dinner, but the red tastes
soupy, flat and alcoholic, because it’s too
warm. Or maybe the white lacks aroma and
complexity, because you chilled it in the
freezer and it’s much too cold. One piece
of the puzzle is figuring out the right
temperature for the specific bottle
you’re pouring; the other is getting and
THE CASE
keeping it there. Most iceless tabletop
coolers are simply insulators, keeping Belgian siblings Helena and Xavier Verellen
an already cold bottle cool for a couple spent eight years perfecting the design of
of hours. But new portable electric the QelviQ, testing 315 prototypes. It shows:
versions not only maintain the For anyone who uses a smartphone, this
63
perfect chill for as long as you want; revolutionary bucket-style cooler offers
they also get it there in the first much more than any other tabletop chiller
place. And quickly. The best is the I’ve tried. It gives wine and food pairing
$495 QelviQ (pronounced kel-vick), advice, has free access to sommeliers 24/7
which selects the right temperature (no bots!) and keeps track of your wine
and cools the bottle two and a half inventory. You set all this up on a proprietary
times faster than a refrigerator. app available in seven languages. Simply
take a photo of the bottle label, and the
app searches a database of more than
THE COMPETITION 350,000 wines for the ideal temperature,
• The $105 Cooper Cooler rapid based on the varietal, region and producer.
beverage and wine chiller cools wine (Many Champagne bottles will fit, but fat
faster than any other device—from ones such as Dom Pérignon won’t.) After
room temperature to 60F in one inserting the bottle, press a button on your
minute. That’s because you add phone to activate sensors that check the
water and ice before you insert the starting temperature. Then it adjusts to the
bottle. After you choose one of its ideal one, using a Peltier thermoelectric
five settings, it spins the bottle and cooling module. Three beeps and a green
sprays it with ice water until chilled. light let you know the wine is à point. $495;
One drawback: It’s very noisy. qelviq.com
• The shiny stainless-steel $130
Cobalance electric wine chiller
has easy-to-read LED touchscreen
controls. It will cool to a low of 41F, but
that takes some time. And its shorter
angled slot doesn’t work as well as QelviQ’s
for tall bottles.
• Two standard bottles fit upright in the all-
black, cube-shaped thermoelectric Vinotemp
two-bottle open wine cooler ($280). It’s made
by a company known for wine refrigerators.
A digital touchscreen allows you to set a
precise temperature from 41F to 66F.
◼ THE SHOW The Businessweek Show airs on Thursday evenings.

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Putting Imagination
To Work
By Max Abelson

tes
Ga
ago
Chic

64

The business world can sound sapped of imagination. There was virtually no room for women in American
Just listen to the language of work: “job,” “staff,” “boss,” art when Judy Chicago’s career began. Now, at 84, the
“­efficiency” and “strategy.” Corporate jargon is dry and painter, sculptor and photographer is the subject of a new
empty: If you want to “drill down,” just “ping me” and we’ll retrospective at New York’s New Museum.
“move the needle” by “unpacking” this “content.” The delay in widespread recognition of her work
But imagination is fundamental for startups that aim to doesn’t bother Chicago. “You know why? Because I had
disrupt or leaders who want to transform. The Businessweek five decades of working in my studio without ever think-
Show turned to two of the most imaginative people work- ing about the market,” she says. “I had my own vision of
ing today to ask how creativity and work can complement what art can be—should be. I believe art is an act of gener-
each other—and how to protect imagination from the osity. I feel really bad for young artists, because they get
forces of the marketplace. swallowed up, spit out, like stocks on the stock exchange.
Theaster Gates is an urban planner and artist who trans- But, you know, you can stand up to that.”
forms abandoned buildings on the South Side of Chicago. Her work aims to spark the imagination of its viewers.
He’s turned a former power plant into a woodworking stu- “If patriarchy were dismantled, would women and men
dio, an old bank into a library and an abandoned school be equal? Would men have permission to be gentle and
into an arts incubator. “I’m definitely always both inventing vulnerable? Would women have permission to be strong?
words and trying to resist certain labels,” Gates says, describ- Would there be equal parenting? Would the Earth be pro-
ing translation issues between creatives and bureaucracy. tected?” she says. “There are questions that we need to
Economic development and urban planning are at the come together and answer. We are so polarized now, but
root of his work, along with sculpture and performance. if we don’t answer those questions, we’re going to drive
Money can reinvigorate a community’s imagination, but the world to destruction.”
Gates warns against replacing the “fabric of the neighbor- She wants museum visitors to imagine answers to
hood” with “gross reinvestment and redevelopment.” After these questions, then to transform a passive visit into
about two decades of building, he’s thinking about how to real civic action beyond gallery walls. “I want to tell
give away what he’s created. “Imagine it as a kind of long- you something: It’s worth it to feel like you’ve made a
BLOOMBERG

term durational performance,” he says. “At the end of the contribution,” Chicago says. <BW> �Abelson is the host of
performance, the audience gets all the props back.” The Businessweek Show.