Editor in chief of Bloomberg Businessweek, megan murphy. One of the most genderneutral equal societies, and they are having a me too movement. Ia this is something this is something that is really interesting. It is still focused on individuals and bad behavior, outrage, anger. Sweden is one of the most genderneutral equal countries smaller gap and. Abor force, a 4. 5 wage gap but really focused on policies. How can we use this moment . Criminal penalties for sex abuse, education, really meaningful realworld change. In america, sometimes were not ofa dad taking these moments outrage and connecting them to do anything with it for change. Meia what is fascinating to about this, there seems to be far more protections for women, they have a strange culture of silence. They see all sorts of sectors in sweden, too. This is a country that is modeled on, in part, because of the regressive paternity leave policy and making sure that men carry an equivalent burden of childrearing. Thate all the studies having men shoulder an equivalent part of household rearing, taking care of that, keeping women in the workforce. As we said, it has a much smaller Participation Rate issue and a wage issue. It talks about these issues openly, but still faces many of the challenges that we see in this article. A very maledominated political spectrum. Industries dominated by men. Place. Ve the policies in carol but where is the enforcement . We have these policies and we need to make sure there is accountability. That is what people are struggling, where these issues have come out. How do we change it and make people accountable . Young mother of a daughter, how do we leave the next generation in a position where this isnt happening anymore . Sweden is proven quite successful making real policy changes. Hopes that other countries will use this as an example and look. Or other things we can do julia talk about mitch daniels. Good is just sort of business, perfect for this issue. , doingerm republican something that other people arent. Universities operated much more as a business with big athletic department, he has done two interesting things. Hes trying to keep tuition cost down. Hes encouraging students to graduate in three years, not f r ur. Bought aversially , he believes it is fundamental to really changing this thing. And how the universes are operated. It is a fascinating look at someone who is going against the grain and against the trend. Carol i love this idea of stopping the increases in tuition. We have more from the reporter. Mosttch daniels was recently the governor of indiana and served two terms as governor. Prior to that, as the most wellknown as budget director of george w. Bushs white house. The Senior Advisor to president reagan. He has had a wealth of experience, mostly in the public ,ector and National Politics and to some extent, the private sector as well. But has had no experience whatsoever as an academic. In that sense, he sort of the unconventional university president. Carol he came to purdue and started shaking things up big time. As a mother who will send her kid to college in three years, i love what he did. He froze the cost of tuition. Wrecks he was clear from the outset that the model that a lot of elite universities, both public and private, have been adhering to. Under pressure. And if it wasnt broken, it was going to break it some point. You have a situation where more and more students are seeking to attend these schools. They have an incentive to continue to raise tuition. It is saddling students with more and more debt that they take longer and longer to pay off. It is especially true in public atversities were you also, the same time, have seen significant declines in state funding. To even the flagship universities Like University of michigan, university of virginia, university of wisconsin. He came in and said weve got to change this and get off this roller coaster. Why dont we freeze tuition and reduce cost elsewhere, make up for that revenue. Maybe it will give us a competitive advantage. Years later, proof is that purdue has benefited hugely from this. The university has seen a massive increase in the number of students applying to go to purdue. Alumni donations. And most importantly, students are graduating with less debt. I would say it is an experiment that worked on a larger scale. This is fascinating to me because it sounds like a man with a lot of policy experience. At the state level in particular, taking it to an and intrusion and seeing how we can shake things up and make it work better. It is an intuitive response. Applications have increased. I imagine a lot of people around people incant get the door. A lot of people were very concerned about that measure in particular. People saidrlier, that if we do this, its going to look like we lost confidence in our product. That is something that any marketer would worry about. If you discount the price of , it signals the quality of that product somehow lower than it has been. Theink he recognize that advantage of being seen as an institution that was actually taking costs seriously, concerned about affordability. Education that costs less and giving students more options. T was a risk worth taking it is to purdue path advantage purdues advantage. Carol he is pretty disruptive in terms of university. Hes talked about interestfree Student Loans and future earnings from the student. An onlineught university, one that was taken with controversy. This year, purdue announced that they had acquired most of kaplan university. It is a forprofit chain of mostly Online Education properties. And basically, what this deal looks like, purdue is going to take over ownership. Kaplan is going to create a new institution with a different still hasnt been fully resolved. They are not spending any money on the acquisition. Provideill continue to backend support and marketing. Do a lot of the nuts and bolts. Receive revenue going forward. Assembly next, is the line a picture of peace or a marketing ploy . Julia this is Bloomberg Businessweek. Carol welcome back to Bloomberg Businessweek. Im carol massar. Julia im julia chatterley and you can find us online at Bloomberg Businessweek. Com. The Company Behind soda stream employs a multicultural staff at their israeli factory. Julia this could be a model for peace in the region. Carol Daniel Birnbaum is the ceo of soda stream. Hes not just selling home soda making machines. At the same time, hes selling piece. Paeace. We wanted to go to israel and talk to him. An Israeli Company and an interesting area that moved from the west bank. Explain the location because this is important. The biggest manufacturing operation was located in the west bank. Which is in the occupied territory that i think a lot of people consider to be that israel is there it illegally. Seized in the war in 1967. That became a big issue because there are some groups that are trying to boycott israel. And the fact that the soda machine was operating made them a really good target and the fact that they had Scarlett Johansson as their spokesperson in a big Super Bowl Ad in 2014. Explain that. Have to back up a little bit. His background is in consumer marketing. He worked on the crest account. The Pillsbury Division in israel. He ran nike. Really great consumer marketing guy. One of the things he likes to do is start controversy. Its effective. It works. In this case, he hired Scarlett Johansson to do an ad for the super bowl where they took these jabs at coke and pepsi. They got a lot of attention for that. And it made them a target for these sort of propalestinian boycotters. I think he likes taking people on. He had a hipster david versus goliath. I think hes trying to turn the whole boycott and make that in soda streams favor. The Company Stock is way up. They bought this company, this private equity firm that hired them, for 6 million and it is now worth 1. 5 billion. Lets get back to the west bank. He was in charge of nike and given the opportunity to move away. Peace, not focus on just a profitable business. He had a real cocktail of employees. That is really important. He comes in in 2007, and they have this plant, this old munitions factory. They said we need to start hiring palestinians. There was terrorism at the time, it was controversial. Metal detectors. Basically, we will all go to the metal detectors. Some people quit. But also, what he was seeing was that andl palestinians israelis working together and getting along. He is saying that maybe what hes doing in the work they said his company is a way, a path to peace, if you will. Much more broadly in the middle east. The leaders of the palestinians and leaders of the aelis, Benjamin Netanyahu they are not interested in peas, just managing the conflict. They benefit from that. They are not seeing a future beyond that. He thinks private sector people like him, they need to take independent of the political process to try to bring about peace. It is the only way this will happen. In terms of what hes doing, being welcoming the palestinian workers, is it endearing him to palestinian human Rights Groups . You put your factory on this , the biggest stole city in israel. , very welcome. Do the workers feel about him . Both the israeli and palestinian workers . We went to the factory. Its pretty amazing. Its amazing that a guy who runs this company, he is the ceo. Its not a huge company, revenues are like 500 million a year. He knows all these people. He has long relationships with them. In theirnvolved personal lives, some stuff that didnt go into the story that im kind of sad about a break dancer, going to acting school. He is on intimate terms with all these folks and they are factory workers. Bank findscentral itself juggling president ial politics. Carol this is Bloomberg Businessweek. Julia welcome back to Bloomberg Businessweek. Im julia chatterley. Im carol massar. You can hear us on sirius xm radio and on the radio in new york. D. C. M in washington, and 960 a. M. In the bay area. Julia and in asia on the Bloomberg Radio plus app. The turkish president has been pressuring his central bank not to raid borrowing costs and he talked up a small victory. President of turkey has a theory about modern inflation. Keep inflation low, keep Interest Rates low, too. He has never explained where he got this idea. Not completely unprecedented in latin america. It was a School Called the structuralist economist. Argentine as the the argument was developing economies in developed economies are different. There are structural issues that cause bottlenecks, and it affects supply and pushes up prices. Those issues are beyond the reach of what the central bank can do to resolve them. So if you do push up Interest Rates, all that happens in an environment where theres a lack companiestion, the push up the cost on consumers and it is feeding inflation more. Except mostasis economies have progressed beyond the state. They offset the cost by charging consumers more. I get that. It does that apply to turkey . Inflation is 13 now. It is double what the centralbank target is. An recently, they had Interest Rate decision and announced a 50 basis point increase in the markets are expecting four points. They went into a tailspin and people are saying, whats going on. We talked to some academics, one , itargue that in the 1980s was true that in turkey, the structural issues due to fuel very high inflation. That is no longer the case barriers wereof dismantled and turkey is now integrated with the world economy. He talks about the Interest Rate lobby. A little conspiracy. Theory. The world wants to undermine us and he says there is this anyway, he says they are trying to damage the economy by lobbying for higher Interest Rates. The point is that the president leaned on the central bank and said we dont want you to hike rates. Perhaps you need to control inflation or at least the markets as you need to. And you got an independent central bank. It is more than an academic difference of opinion. Turkey has a huge deficit. Is about 5 of gdp and i think if you recall in mexico, it was around seven. When these get quite large, investors are on their toes, watching with going on. If you see this dynamic between the government of the centralbank, it could basically turn confidence in turkey around. Carol with turkey borrowing a quarter of the gdp to finance debt, you have that out there. If the economy falls into any trouble, they will deal with servicing the debt. That will be complicated. You also have elections coming up. You are doing these fun dances and i feel like they can manage a couple of different things. His priority is stimulating growth. Set up thewhere they special fund in order to lend companies and disperse billions of dollars already. With the turkish economy is that it is incredibly interdependent. Go up, imports are going up as well. This issue with the current account is sort of chronic and kind of builtin. So they need to level games. They need to be playing to the local constituency with an actual election and satisfy the demands of international investors. Julia , chinas roadmap for dominance and electric cars. Carol and a new fitness fad in india. Julia this is bloomberg fitness week. This is Bloomberg Businessweek. Julia welcome back to Bloomberg Businessweek. Im julia chatterley. Path satyaosoft nadella and the godfather of indian fitness. Julia all of that still ahead on Bloomberg Businessweek. Julia we are back with Bloomberg Businessweek editor in chief, talking about Chinese Companies always happy seeing the government to foster, subsidize, and protect. Now they are laser focused on electric vehicles. We spent a lot of time on this, China Growing their own homegrown dominant industries. It feels like it is when they are really going out for that. China is the biggest buyer of electric vehicles. In 2015,assed the u. S. Over one million expected to be sold in 2018. They have a really ambitious target of 8 million by 2025. Ambitious goal, and it is really being pushed by the government. They see this as a the next industry. The key to chinas dominance, they look homegrown to develop the best technology and really dominate their own field and look to export it elsewhere. I think we will see exactly the same thing. Carol we talk about tesla and elon musk disrupting the auto sector but it might have to be a chinese company. Have their Homegrown Companies competing in this space theyre offering healthy incentives to do this. Consumers are getting as much as 10 rebates. And we should mention there is a Good Business aspect. Na needs to have a massive there is a massive problem in the urban areas where it is not healthy. Almost two full. That being said, the economic. How much they think they can move into this space, we see the requirements europe has put on in terms of electric vehicle consumption of production. Very few people have the ability to produce and mass where we see these going right now in china is a place where you might be able to. Volkswagen, gm, toyota. All the big guys that have billions of dollars. Where do they fit here. Obviously, they would love to tap into the demand we are talking about for the chinese market. When china is intent on building coming have to wonder. They will have to pay to play in this market. The european and American Brands have sort of a cachet factor among chinas more elite and established class. That being said, this is really a freeforall in terms of getting in there and dealing with that demand. If you will be offered this kind of incentive to not only produce but consume. , we talkink about this about elon musk all the time but they are still not producing nearly enough teslas to meet demand. This is about matching up. Carol three years is a long time in this space. It is a huge amount of time in this space and are no weve grappled with the amount of change in the ev with charging, battery it is so massive and we spend a lot of time writing about it. Thel lets talk about story, i love a Good Business story. Who knew them in the land of where yoga was created, they have a health and fitness problem . It is a fascinating story inut how the fitness craze. Ndia, they become so much more rippling absy with. This is a great story about how they are tapping into this demand. Julia here is our reporter. Reporter i went to india in june to profile walker, the 84yearold director of a Company Called better fitness. They are pioneering the gym industry in india. I went there and sort of look that how to sell the gym business to a bunch of indians who are not familiar with what it means. What do you mean by that . The gym, we are familiar with it in north america. A mainstay for many people. In this part of the world where this exercises and so common, it doesnt exist. In india, the business has exploded fairly recently. , theurnofthecentury business really exploded. And as more money comes into the andtry, the boom continues a lot of upwardly mobile aspirational indians are discovering the gym membership. Carol i am someone whos done yoga for a long time. India is where it is created. I assume everyone did yoga and is healthy. Thats not the case. People continue to do yoga, but the idea of yoga that we have in the u. S. , for example, as a form of exercise that has been commercialized that is something that wasnt as popular as you would expect. It has become popular on the west and some of these entrepreneurs are now taking it back and selling it back to india. It is a developing economy and has come a long way. That means there are people that have more discretionary income. They are eating more, potentially, but the downside is there is an unhealthy population and people that are more overweight. As the gdp has grown dramatically over the last few decades, a lot of middleclass unhealthyve developed habits that includes junk food, smoking, alcohol. There is still a lot of malnutrition in the population. That persists. But within this upwardly mobile demographic, there has been a huge increase in obesity, heart disease, almost 10 of the population has diabetes. And the obesity rate increased between 1975 and 2014. They have come a long way from when they had to institute caloric a minimum to make sure people were eating enough. The issue is how to keep people from getting heart attacks in their mid20s. Some have called the godfather of indian fitness. And 84yearold man, he exercises in nothing but bodybuilding and there is a very warm and very eccentric. A country that hasnt seen anything like it before. It is through to his father, and they have over 200 gyms across the country and extending very rapidly. That. Eally introduce american kids, for the most part, if they are lucky, it is not the case in india. When they open up, it is still a city of 1. 2 million people. And have to do outreach explain what cardiovascular exercise is, for example. What weight training is. A lot of people also come to this idea of exercise because their doctor tells them to. Theyre having heart problems in their 20s. , the 19 minutes that change the art world forever. Julia and exchanging gold in ecuador. Carol this is Bloomberg Businessweek. Caroljulia welcome back to blog is this week. Im julia chatterley. Carol and im carol massar. You can find us on businessweek. Com. Julia in the rain forest of ecuador, a minor is searching looking for gold. Carol using a combination of our technology and ancient maps. He is a geologist. They have had various successes before, and there is a dream for several decades to go find the lost cities of gold. Carol what are the lost cities of gold. It was established in the 16th century and mining a heck of a lot of gold. The spaniards were kicked out by the local indigenous people. They send waves and waves. They are cities and really little settlements. Each time, the soldiers would be each time the spaniards gave up, they lost control of that region. May have always sort of existed in the imagination of people. But they a also exist in maps ad travel chronicles. They spend a lot of time in the vatican library. There are hundreds of years old documents. Was already an working geologist. Peru andsses in elsewhere on the globe, trying to take a bit of a sabbatical. Taking an intensive course in spanish. , they areamily assessed with the maps. And they told keith barron about this map that dates back to 1574. Carol the gold regions of peru as it was translated. Exactly. Carol jackpot . These maps were not unknown. They would find a lost cities. They found other gold in ecuador. That is what the story is about, the search for one of these cities. Hundreds of millions of dollars in the highstakes artwork. She loved it and did the math on who made wide. Julia nobody knew what was nobodyappen knew what was going to happen. People in the industry knew that it was going to sell. It was going to sell. They say i want 50 million for this work. Says, nouction house matter what happens during the sale, you get your 50 million. Julia where does the auction . Ouse sit in the middle of this do they find someone to offer that price . How does it work in terms of finding the guarantee . In the past, auction houses finance the guarantees. Hope that be on the it doesnt sell. During the financial crisis, there are tens of millions of dollars. It was a bloodbath because they were on the hook for that. And they had to take all of this into inventory. So after the financial crisis, they stopped doing guarantees for a while. When they came back, lets outsource risk. Lets find another person that place a prearranged bid. If nobody wants it, you will buy it. Insurance for the sellers and insurance for the auction house. They are not on the hook and they dont take the risk anymore. Leonardo the case of that has this guarantee, multiple times that. What about the person they made a lot of money. This, wee details of are never going to find out exactly what happened. Usually, the guarantor for taking on the risk. Take givehe money and the seller if nobody else bids. , the bidding went for 19 minutes. It feltt felt julia like longer. Wasnd so the hammer price 400 million. Extra, that is commissioned. Million on the outside that is shared between the seller and the guarantor. Sellers mustd the love this. It gives them the product, the most desirable work that otherwise wouldnt come up. Carol , how to be a leader at an Iconic Company that has already had to ceos that are larger than life. Onia Satya NadellaBloomberg Businessweek, just ahead. Carol welcome back to Bloomberg Businessweek. Im carol massar. Julia im julia chatterley. It you can listen to us on the a 6. 1 innew york, won boston, 99. 1 fm in washington, 960 a. M. In the bay area. Carol and in asia on the Bloomberg Radio plus app. In the debrief, megan murphy sat down with microsoft ceo such a the della Satya Nadella. Julia filling the considerable shoes of bill gates and steve ballmer. This is the best part of my job. With him, i was lucky and had a clear place to start. Was fascinating to me because i highly recommend people read it. Sort of detail about his life, which i dont think people really understand, and with his wife and disabled son. In his book and how he mulled himself to the executive is about empathy, putting up with the epic core of a corporate culture. Particularly one that has gone. Hrough that thats what i wanted to talk to him about. And when companies are expected to carry more of a voice. The immigration policy, infrastructure, ai. How do you wield that voice . How do you be that leader both internally and externally . The importance of listening, to be empathetic. Megan he is the third ceo of microsoft. He follows bill gates and steve ballmer. That is not easy. He says that when the names were circulating as Steve Ballmers replacement, none of the internal candidates were driving any enthusiasm among employees, including himself. [laughter] candidhe is incredibly about the cultural problems he felt that microsoft had when he came on. And how broken he felt the company was. In what way . That employees were not empathetic toward each other and there was a competitive culture that Business Units werent aligned in a single direction. This is a company that we all think we know and we have all used office. We know there products. We know the bejeweled history and the place in american culture. Thatve someone that candid needs to reinvent that, i found that particularly moving. Julia how do you reinvent a culture with former ceos that were so pivotal in their own way in the time that they existed at microsoft . Carol kendall out an outspoken. Megan there were a lot of employees in the room. If you meet him, one tip i would give executives is, hes very unassuming. He is quite selfdeprecating. To a fault. And describes himself as an average kid, got lucky. Somehow ended up as ceo of microsoft. We know thats not true. Interview ahen you lot of senior people, the people who know that the world does not revolve around them and actually revolves around their business and their employees he is not mistaken about that. Carol just listening to what you have to say about empathy, something struck home for him. You talk about his son. Ander through this tragedy this illness, it affects them. Megan his son is disabled, and they talked about the moment where they found out. I really respect his wife was the one that said to him, its not about us. It is about making this journey as productive and involved. It really shaped the mindset of nothing has happened to me. It is my job to go out there and try to make the world a better place in the way that i do through microsoft. But it is not about me. Carol its available on newsstands now. Julia an online and the mobile app. We saved the best for last in this one. Carol we both love the story that megan murphy did with Satya Nadella. He talks about empathy in the work lace, empathy and life. Its really important. Julia the importance of empathy in leadership. A man with pretty big shoes to fill as far as microsoft is confirmed concerned. More Bloomberg Television begins now. Announcer brilliant ideas, powered by hyundai motor. Idea, ideas sculpture is an incredibly dynamic discipline. It has an endless amount of possibilities