Global Trade This Week – Episode 116
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Keenan Brugh 0:00
You're watching Global Trade This Week with Pete Mento and Doug Draper.
Doug Draper 0:10
Hello, everyone. Here is a another edition of global trade this week. We kind of lost track of where Pete is. This week. I'm not sure what airline or air or town he is in. So we decided to bring in the man about town. Keenan is going to join us in today. So Keenan, how you doing?
Keenan Brugh 0:30
Hello. I'm doing great. excited that we're hitting fall weather now. It's a little bit cooler during the day a lot cooler at night. Yeah, so I'm enjoying the changing of the seasons.
Doug Draper 0:41
Yeah, yeah, it is good. You know, it's good sleeping weather, as they say windows open at night. And and I heard and this is more for folks here in Colorado. Is that because we have such a wet summer right at the start and temperatures have been relatively mellow that the color changes up in the mountains. They're going to be spectacular this year.
Keenan Brugh 1:03
All right. All right. I'm into it. Yeah, leaves are always pretty. And I was hoping you were gonna go somewhere about a being a great year for skiing. Somehow that wet summer would translate into a lot of precipitation in the winter. Hopefully that's the case.
Doug Draper 1:17
Yeah, well, we have plenty of time. You're on a split board, and I'm on skis. So there'll be plenty of planning discussions on on on winter sports, for sure. So that's right. Conditioning
Keenan Brugh 1:29
season is well underway. I don't know if you've begun your formal training, but you got to make the most of it. Formal training
Doug Draper 1:36
it by drinking beer and eating Cheetos as part of the formal training. I'm all in. I've been doing.
Keenan Brugh 1:42
carb loading. Exactly.
Doug Draper 1:45
All right. Well, hey, man, let's get this thing started. I think we'll have you go first. Because I know your topics, we got four good topics, right. And we'll just kick it off with you.
Keenan Brugh 1:55
Sounds good. So Topic number one here, I thought was interesting. Mexico remains the top US trade partner in July. So for seven of the past eight months, Mexico has ranked number one for us trading partners. Now this has happened before. But pretty consistently, for a long time. It's been Canada from the 70s going on up until modern times. And then, you know, in 2015, for a few years, it was China, number one, and then Canada took it back. But now it seems like Mexico is making a really big play for it. And a lot of the reasoning both according to reporting I'm seeing from freightwaves and others. And also from our experience with CAP logistics, there is now a greater and greater trend of nearshoring. And doing manufacturing in Mexico. This has been a topic I've been hearing about for a long time. But now it's gaining steam to the point where it's pushing Mexico above Canada as the US trading partner of choice, which is pretty pretty big. We're seeing a lot more manufacturing going on in there. Some of its even Chinese companies just looking to either get around certain trade restrictions or just get closer to limit expensive logistics situations like we saw towards the beginning of the pandemic, when all of a sudden container rates were very pricey going to and from China. So they're looking to get a little closer to their largest market and manufacturer, but a lot of it's not Chinese, it's just manufacturers from all over the place. Whether you're a Swedish manufacturer or a German manufacturer, I know of some German manufacturers that are building some facilities and capacities down in Mexico so that they can produce and then sell to the ultimate market here in the US. So it's interesting, a lot of these things don't change from time to time. It's Oh, yeah, Canada, or China is our number one trading partner or it's Canada, but now it's Mexico. And so it's one of those things where it makes me want to brush off my Duolingo. Fortunately a caf, we do have great people who speak Spanish, I am not one of those people. It's been since sixth grade. So I really need to dust off that language. If we're going to be doing a lot of trade back and forth. What are your first impressions, or have you been seeing any of this trend leading up to Mexico being our number one trade partner?
Doug Draper 4:13
Yeah, yeah, yeah, I saw that. It was I think it was a freight raiser freight waves article that you and I both both caught. So the first thing that comes to mind is when you said, ocean freight raised, ocean freight was rising. I think you needed to put an F bomb in front of that statement, which would have the emotion of how people dealt with insanely expensive ocean freight. So I just wanted to say that for starters.
Keenan Brugh 4:39
It wasn't it wasn't a little bit, it was an order of magnitude from 3000 to 30,000. It was a big increase. It's just awful.
Doug Draper 4:46
I mean, that's a whole nother podcast, but this unbelievable whenever you just said that number. I mean, you never would have thought of that. So the other piece that caught my attention is that you know nearshoring and ride sharing Friend shorting is a term that I've heard recently. It's been talked about for a long time. And it's always, you know, people have hyped the benefits of it. And I think another accelerator of COVID, right, was to push that and make some of those forecasts true. And we're seeing that now, right. Now, is there one gigantic industry that has just popped immediately that says, that's the reason why, no, but you know, I think we're starting to see it. And the fruits of it, if that's the right word to use, I think, is that sustainable? Is there just a blip there? Or are we going to continue to see Mexico right at the top for US trade partners or not? So number one, I'm glad that the talk is now statistically being shown. It doesn't seem like there's one juggernaut piece of business that has caused that, which to me is good. That means all of these, you know, small, quote, unquote, and medium sized companies that are are moving is pushing the envelope. Right. So so that's pretty cool. And it'll be interesting to see what happens in the near term. It's trending for the year, we'll see what happens. We still got four more months left, or three and a half months. So yeah,
Keenan Brugh 6:18
absolutely. We do plenty of business with Canada. But yeah, it has been increasing with Mexico and great points. I agree with you from what I've been observing. It's not one major country or one major industry, it has a lot of countries, and it has a lot of industries, increasing their manufacturing. And I wonder if similar to other trends that you've been covering on E commerce, maybe there already was this trend, people have been talking about nearshoring. And then COVID pandemic and Pandemic policies and resulting situations kind of expedited that trend a little bit. So it will be interesting to see. I'm kind of thinking it might be more of a trend here to stay. But who knows, Canada might might also get in there with some other nearshoring manufacturing or other sorts of things to compete against, because it is pretty close neck and neck with Canada and Mexico. But it'll be an interesting thing to keep watching.
Doug Draper 7:10
Yeah, yeah, for sure. Good, good topic, good topic to kick us off. So got, excuse me. So my topic, it wouldn't be relevant if we weren't talking about the year of labor. Right. Now, as you know, last, I think it was Friday at noon, or Friday at midnight, United United Auto Workers went on strike. And first glance, we're gonna dive into that in a second. But the bottom line is the winner, in my opinion of all of this craziness, is our good friend, Elon and Tesla, right? They're just sitting back and watching, watching everything unfold. And so that when I was thinking about that, it led me to do a little a little research. And these are numbers from the Wall Street Journal, Kenan Pete, and I don't really reference our sources, we just kind of throw stuff out there. And people like what that real. So this is real on Wall Street Journal. So the labor costs per Tesla averages out to $45 an hour, that's a loaded cost with the pennies and all that kind of stuff. Currently, United Auto Workers is $66 an hour. So just in the current state, or previous in our Yeah, in the current state. You know, it's $21 more expensive. If all of the demands come through, it would push that hourly wage to $136 an hour, which is just unfathomable how that can happen. You talked about ocean freight rates going from three grand to 30. How can a business survive when their labor rates jumped more than double 66 to 136? So it's not the key things that jump out on on this one is a 32 hour work week, but get paid for 40? All right, that's a huge one, a 36% wage increase. That's another one. And then there's eliminating compensation tiers and restoring cost of living increases, extending retirement and stuff, those are all kind of manageable, but the two big ones is, is working 32 hours and getting paid for 40. And the other piece is, you know, the wage increase. Two comments on the fallout of this number one is there's only, I guess, three factories, three manufacturing places in Michigan, Missouri and Ohio, one for each of the big three. So it's not the whole enchilada and it's not the whole, you know, all of the auto workers. So it's just dabbling, and I've heard that that's the case because they are getting strike pay. And if everybody went on strike that the coffers would not be able to sustain strike pay for everybody. So I think it's going to be little blips and figure out where the pain points are, and go from there. Strike pay is only 500 bucks a week, which sounds good the first, you know, couple of the couple a week or two, and then reality strikes in that food needs to be on the table and gas needs to be put in a truck. So, you know, we'll we'll see how that goes. But and then the other piece, obviously, this is logistics supply chain and global trade is what happens is supply chain. I think if this thing comes down and gets resolved in 20 days or less, I don't think we're going to see that much of an impact beyond that. The things I've read, is it it could start really impacting. And the final comment on this Keenan, before I'll have you chime in on your thoughts, is that there's going to be panic buying, people aren't sure what's going to happen. And if you're on the fence to buy an automobile, you're going to do it now. And that's also going to raise the already extremely high prices on pre owned and used cars. Right. So I think that that's what's going to impact the consumer out there is panic buying used cars are still going to continue to creep up. And I think will be cool. Just as the supply chain goes, if this thing lasts less than 20 days beyond that. That's a whole nother topic. So I don't know what your take on all this.
Keenan Brugh 11:23
As I'm not an expert in labor law, or I guess we're in a lot of unprecedent situations anyway. So maybe Pete or others have had experience and can read what's going on. But ultimately, the companies can't handle not having workers right and there, there's no ready supply of robots, that's going to replace everybody. So they're probably going to have to come to an agreement, it's only going to get more and more painful as opera production lines are down for longer and longer and longer. So my amateur prediction would be that they will reach an agreement. I mean, it's already started to strike. So it's gone hot, so to speak, but there will eventually get an agreement, whether it's fully what they're asking for or even more, who knows, they probably will end up being paid more just to kind of the trend we've been seeing lately with other union actions, labor actions. And it's one of these things we might be seeing more and more of, you know, in big industries, there might be big labor groups organized and negotiating. But ultimately, the inflation that we've seen the last couple years since lots of new dollars have been created and or spent by the government since the pandemic and Pandemic response, that inflation is working its way through the system, people have already been noticing. Eggs are more expensive and cars and more expensive and different things. But eventually, they're going to have to ask for raises, they're going to have to ask for more money, especially when some of these corporations are looking at record profits, right. And so we're probably going to be seeing more and more of these, probably some of them with organized labor and strikes. Some of them maybe just on the individual people will move if the company doesn't pay them more, or some other company will offer more. And you know, it's interesting going into potential recession the second half of this year, early next year, maybe the United Auto Workers are doing it at the right time. It could be a good time for them as opposed to six months earlier or six months later than what it is right now. So non expert opinion, it seems like they've timed it pretty well. I think they're probably going to get what they're asking for. Yeah,
Doug Draper 13:35
yeah, that'll be crazy. But you had a good point. It's like this way from COVID. Right. All of the labor issues this year, have been transportation related. Right. And I think we made mention, I don't know if it was before the show last week or not. But you know, I've had people say, Gosh, when COVID hit, you know, did you how many days? Did you not work in the office? Or you know, how did you do it and I'm like, zero, I was like in the office the entire time practicing safe disks and steam. But like I said, you can't virtually ship a box, right? So you can't deliver a box without a truck and a driver and all these things. So even so during the pandemic, all of these entities were still on the front line, and now it's come to roost if that's the right word. So it'll be interesting.
Keenan Brugh 14:21
Interesting, for sure. And just funny aside, you had mentioned the Wall Street Journal. You know, we we do often reference lots of different stories and things but uh, there's one apparently the Wall Street Journal wrote an article about Tesla being in talks with some Middle Eastern companies about building an Eevee plant. And Elon replied on Twitter now x.com That is an utterly false story. So either Elon is lying and doesn't want the secret out for some reason or the Wall Street Journal is just reporting on things they don't have. I've also been seeing some more mainstream news organizations kind of running out of actual stories that they're investigating so then they just end up reporting on tick tock trends or Instagram trends. Yeah, maybe I'll just use that I didn't come up with a halftime ahead of time so I'll save that for my halftime
Doug Draper 15:13
Nice nice. Well as you know Keenan because we call you out multiple times during our show that halftime is brought to you by CAP logistics. Keenan is the man the myth the legend he and his company enable Pete nice to have this platform to talk to you about our our comments and criticisms in our industry. So Keenan, I always say Namaste on my post. So there you go. And we think cap logistics for having it so i Man You go first on the halftime I'm cool with that.
Keenan Brugh 15:45
Let's do it. Yeah. So this week, the Wall Street Journal and others I'm sure to NBC I think saw covering it. We're talking about a trend, not sure where it started tick tock Instagram, one of those things I don't use regularly of women finding out that their husbands, boyfriends, brothers, partners, whatever, dads, anything cousins. Women have been surprised to find out that men, a lot of men anyway, think about the Roman Empire on a fairly frequently basis. So the women are incredulous. They film and ask their their partner, brother, whatever. And then, like I don't know, every day, every other day why? And then women are shocked that that's that often. So I guess my question to you is, how often do you think about the Roman Empire?
Doug Draper 16:33
Yeah, I would say very infrequently. Remember, you know? Yeah, I don't know, my birthday is on the Ides of March. So every once in a while I'll drop every year. Yeah, I'll drop an eighth at TU brute a. And then if I'm ever at a party, and there's a bunch of cars out front, I pretty much say it looks like everybody came Roman style, right with their chariots. One, one. So that's like twice a year because I don't go to very many parties. And my birthday happens once a year. So I would say twice a year is when I think about it.
Keenan Brugh 17:11
I'm not sure if I'm quite on the trend of every single day, that could be possible. But pretty close. I mean, it comes up. There's memes that involve the Roman Empire. There's lots of obviously lots of comparisons between politics, everyone looks back at what happened with the Roman Empire. And a lot of our US political institutions are kind of modeled after the Roman Empire and how they did their architecture and how they did their coins and how they did this and that sort of deal Republic type of things. So there's that, I think might have been a topic on global trade. Earlier this year, there was some new research on how Romans did their concrete in a way that was actually self fixing. So that might have been a recent real deep Roman dive as there are currently lessons we can learn from what they knew a long time ago, of how to make concrete self heal. As in, it'll crack, the rain comes down, the rain dissolves this calcium carbonate and fills in the cracks before they can expand any larger, which is more advanced than the concrete technology we have today. So I'm not quite sure if I've reflected enough to know how often but I'm somewhere less than every single day, but definitely more than twice a year. I'm probably five out of seven days a week. Are you serious? It comes up all the time. I don't know.
Doug Draper 18:37
Why. Wow. All right. Well, that's an interesting, we'll have to pose that question to our other co host next time. Next time. Cool. All right. Well, this one is for all well as much as everybody in Colorado, but it's making national news for sure. Primetime primetime in Boulder, Colorado and Deion Sanders. You know, really surprised everybody with what University of Colorado is doing. And I'm not going to get into all that. This isn't a football discussion. But the thing that caught my attention is, and if you're not from Colorado, one thing about this team is they have a swagger. Right? And probably some people think it's a little over the top if you saw the CSU football game, I think there was like 15 Personal foul penalties where I don't know that people are just got this swagger a little bit, a little bit in your face, between that mentality, the transfer portal, the consolidation of the big five conferences, and the NFL name image likeness. I think Deion Sanders and prime time is kind of accelerating. Now use that term earlier. What NCAA athletics is going to look like in the future right, there's going to be swaggered guys are going to be making money. I think Deion Sanders son should dere is Whoo, you know driving like a $200,000, Maybach, Mercedes, right. And everyone's like, Okay, that's cool. Five years ago, you know, that'd be, you'd be suspended. So, and even, you know, my daughter's a rower at University of Kansas, and she even has a group, the university supports the college kids on all sports, on how to present yourself to promote NIHL. So it's almost like she has a an agent, if you will, and the university is making sure they go about it the right way. So they're talking to him about I think there's like this kind of Facebook page that that you can set up for as an athlete to promote your NFL status and things you could bring to the table. So anyway, the the halftime and my whole point on this one is I think what we're seeing in Boulder, Colorado and the craziness, the excitement, around prime time is just a precursor of what modern day, NCAA football is going to look like.
Keenan Brugh 21:07
Very interesting. Yeah, I know, there have been major changes on the rules there. I don't actively watch sports. So I haven't been observing it. So my baseline is still set where college athletes are not driving around multiple $100,000 cars, because that is not allowed. But maybe that is allowed now. And it's a different sort of world. I think I had a friend go to the most recent game up in Boulder, we'll have to ask him his experience and what has changed because it probably has changed a lot in the last few years that I have not seen. Yeah,
Doug Draper 21:37
it's crazy. The sunglasses that he wears, the day before the CSU game last Friday, they sold 1.5 million pair were pre, you know, they didn't have on the company. I forget what the company's name. It's like peppers or something like that. But I mean, they're crushing it right. And so all this money that's coming around NCAA sports that's maybe already been there, or always been there that's now coming to the surface. It'll be interesting to see what transpires in the next two years.
Keenan Brugh 22:08
Yeah, I mean, just kind of wrapping that up. It hasn't even been that long that in the professional world. Investors and producers have been treating sports football primarily but other sports as well as entertainment franchises. For a while it was like a whole different sort of thing. But I'm blanking on the guy's name. It might have been like the Morningstar founder, there's a billionaire that I think he started with, like Philadelphia or something, but like paid a lot large sum of money to buy the team, but then treating it more as like, hey, we have a hit movie, we have a hit television series that people will be coming every week to watch, we know what that's worth. And to your point, if people are paying attention to star athletes, and they're making recommendations of these are the sunglasses eyewear, use code XYZ to get a discount. Those types of influencer marketing campaigns can be highly effective. And so there's a company that sells glasses or any other thing, they will probably try to work with these athletes to reach that audience. So it's connecting buyers and sellers in ways that we haven't seen in the past. And it's still relatively new with the professional sports and Disney getting on board with ESPN acquisition and what we've seen there, we're probably going to see that more of that process filter down now that the rules have changed in order to help student athletes be compensated because I mean, this stuff was happening anyway, it was just under the table. And so now now, hopefully, it's a little more aboveboard. People get to see what the rules are and play fair.
Doug Draper 23:39
Yeah. Yeah. Good. Very interesting. All right. I'm making a U turn here. Excuse me. And we're going to get back on track with global trade this week. So I think you started with your first topic. So I'll throw the ball back in your court once you got for Topic number two. Yeah, Topic
Keenan Brugh 23:54
number two is on diesel prices. You know, I've already been seeing recently sources like freight waves have been talking about experts predicting there could be higher diesel prices this winter, this fall up to $5 per gallon, which is over $1 Where we are right now. But then I saw another story this morning about oil hitting a new record high as Azerbaijan is contemplating military action. Apparently, there's some tensions between Azerbaijan and some of the Armenian population. They border Armenia and I guess there's some Armenian people who live in a region. I'm not sure of the details, but apparently there's been some terrorist activities or threats or tensions and now anti terroristic activities and tensions. And this is only further increasing speculation that there may be tightening of supply. There's already OPEC and limitations and quotas being controlled and keeping prices at a certain area. You have that and then add on some unexpected military conflicts like The new terror war war on terror type of situation. It's flirting with $100 barrel. Again, we're sitting at 95. Last I saw here WTI crude. So this sort of stuff has impacts on transportation, obviously, and all the industries that we serve. So wanted to see if you've been hearing about this potential $5 diesel price for a while now, or if you'd heard of the Azerbaijani anti terrorist activities, but that seems to be what investors are currently fearing, and are bidding up prices of oil right now?
Doug Draper 25:38
Yeah, yeah, I've heard a little bit about it. I've never heard pegging a number to the fuel, like you said, Five bucks. For diesel, I've not heard that. But I have slowly watched the, you know, the cost per barrel jumping up and, you know, it makes national news and everything's crazy when it pumps over 100. And, and we're right there. So the two comments on that, and then and then we'll, we'll we'll move on. But the first one is that logistics companies made a very strategic play, it could have been 25 years ago to separate the cost of the activity of delivery, and the cost of freight or excuse me, the cost of fuel, right? When I started my career at airborne Express, and if you're over about 45, I'm sure you've heard of that company, if not, they were acquired by DHL years ago. But when I was at airborne, it was just a flat rate, right 10 bucks to get you here, there. And then by separating the fuel, and the rate for the actual work, I think has helped justify to carriers, hey, this piece is not us. We're not trying to make any extra money, this is something that we need to pass along. So I think the logistics industry in whole has done a great job separating those to help explain what's going on and why the rates are what they are. And the other piece, Kenan is that, and I made a reference to this year ago, maybe a year ago that you're going to get out of your car, you're going to look at it and say, Oh, my God, you may use other expletives than that. I can't believe fuel is $5. This sucks. And then you start pumping your gas. And you listen to the Katy Perry song on the radio, and you think about the Coke, you got to go and buy. And then you fill up your tank. And that's just part of life and you move on. So I don't know at what breaking point it's going to be where people are going to change buying habits, but transportation our industry, they've separated the two, which is put them in a good position, justifying and explaining the fluctuations of fuel. And then the bottom line is, you know, if I want the pillowcase that I want, and I got to pay an extra 50 cents because of fuel, I'm gonna pay it, right. I mean, that's just the way it is and how dominant fuel is in our industry. So those are the two things that I have comments on.
Keenan Brugh 28:03
Yeah, great points. And with the spike of cost of transportation over the last couple years, I imagine many businesses that had as a core part of their business model, super low, international or US domestic freight, already kind of had to deal with that issue of what are we going to do if Can we pass along our prices? And in many cases, if they could, they would? And if they couldn't, they can't? And then we're out? So that would be a good question. I'm not expecting a bunch of businesses to go out because freight becomes more expensive if if diesel goes to $5 a gallon. Those companies have probably already been purged the last couple of years as costs have gone up or they've figured out another solution nearshoring or buying a domestic source or whatever the case may be. Yeah, something to keep an eye on that trend is going that way and any conflicts can end up increasing that kind of as an aside not quite a halftime but as an aside. Did you see that story about the US military jet that was flying without a pilot for a while?
Doug Draper 29:07
I was I was about to bring that one up I saw I mean you're talking about the one that the pilot you check and then yeah, literally they couldn't find the jet
Keenan Brugh 29:16
Yeah, I don't know all the details don't know what's disclosed are still confidential but for whatever reason they had rejected and the jet still flew it was still flying in autopilot zombie mode, but it has apparently been found. I think it went down somewhere in South Carolina. So at least it didn't end up in any foreign countries hands but yeah, wonder to him it was just gonna keep going until they ran out of fuel. I guess I don't know. It's crazy situation was not expecting to see that news story this week.
Doug Draper 29:45
Yeah. How do you lose a $500 million jet? Or you know, I don't know if that's the
Keenan Brugh 29:51
price. It was only two only 280 million.
Doug Draper 29:55
I mean, you're kidding me? That's insane. I don't even know. It's just bad. Definitely, to me, you think of all the good, amazing technology that's out there and yet, quarter of a billion dollar plane just goes missing. Crazy. Crazy. So I'll wrap it up here with this. This one's pretty quick. But I saw this one. And I was like, okay, is this the final straw where Amazon is really a logistics company? Or are they an online retailer? Or did they start as an online retailer, and just because of their service offerings have morphed in. So the reason that caught my attention is that Amazon has come out with a service called supply chain by Amazon. And for lack of a better term, it's a freight forwarding division. So now they're saying, Hey, we can pick your widget up in China, and we can manage the freight and the transportation over to the US, right, so that's a new, a new service offering. They also have a program that's called partner carrier program, or PCP, or they can handle the domestic trucking to DCs that you need to ship to, and they do not have to be Amazon DCS. So that's essentially a domestic trip, truck brokering operation. And then they have what's called aw D, which is Amazon warehouse distribution, where they say, hey, we'll go ahead and warehouse your product for you. Don't worry about it. That's essentially a three PL warehousing company, right. And then I heard that they're coming out with kind of, they're going to overlay all that with machine learning, to try to figure out and direct efficiencies. So they'll be able to say, here's where we're going to import this based on buying habits. And so this vessel of this widget needs to go through the Panama Canal and get on East Coast distribution center. So you know, pick up inventory from manufacturers all over the world, they can ship it across the borders, they handle customs clearances, that domestic current transportation, they manage your inventory, when to replenish it, they can handle final mile. It's just It's crazy that they are officially becoming a logistics company, and not an anti online retailer. So that's it a freight forwarder truck broker warehousing, and then overlaying it with technology to make that whole process efficient. So it's official, Amazon is a logistics company.
Keenan Brugh 32:25
Wow, quite a move. I don't follow Amazon super closely. But just in learning from you. And Pete, over the last several weeks, months, I had heard that, you know, they've made big moves, acquiring assets, and then they kind of pulled back a little bit. So they like grow and expand and then pull back and keep just the parts that are working well for them. And Amazon's supply chain needs. But now it seems like they're growing again. But then not just serving Amazon. I mean, maybe Amazon will get special treatments and rates or just better network availability of assets. Movable or warehousing, if they're also serving other companies. It's an interesting move. They're actually becoming a logistics company. Very interesting.
Doug Draper 33:09
Yeah. So they'll take a little bit of piece of the pie on the freight, they'll take a piece of the pie on the warehousing, they'll take a piece of pie, the final mile delivery and oh yeah, we'll make our money because we're providing the platform for you to sell it in the first place. So you know, kind of it kind of makes sense. And they've had a pretty phenomenal run at all the logistics things they've touched. So it'll be interesting to see what happens with their freight forwarding entree. So
Keenan Brugh 33:33
definitely a space to watch. You know, they've had some notable big failures of investments. Like I remember, like some of the fire stuff, I can't remember, I think they kept some of the brands, but they tried to make a fire phone and stuff. And that never quite worked out. So they make big experiments. But I think something that Amazon does well compared to some other big tech companies, is they'll try experiments, but then they'll see if they're working or not. Oh, no one wants an Amazon Fire Phone. Okay, we ask that we move on memory hold up, people won't remember I did somehow but most people won't remember Amazon even tried and failed to do a smartphone. But for the ones that do work out, they just become a new thing. Oh, yeah, Amazon, of course, the head of Amazon Web Services, and now that's making a good chunk of their profit. So this is something similar where Amazon needed Amazon Web Services. So they started doing it for themselves then became the dominant leader for everyone else needing that type of web services. Amazon needed physical logistics and now they're going to be offering it to other people as well. So very interesting to watch.
Doug Draper 34:34
Yeah. vertically integrated and owning the rails. Right. We've talked about that in the past so but you know what is also interesting Keenan is this show and it comes to our listeners every single week. It doesn't matter who's on the other side of the camera. Sometimes you fill in for me sometimes you fill in for Pete. Sometimes Pete is right there in front of our faces. So we want to thank everybody for joining us. Sweet keen and I can't thank you enough for filling in awesome topics. I think we had a good, good dialogue on all of them. So. And then of course I want to thank our listeners for joining us. And we look forward to seeing you next week on another edition of global trade this week. All right, Keenan. Thanks, man. Appreciate it.
Keenan Brugh 35:17
Thank you. Have a great week, everybody. All right, you guys
Transcribed by https://otter.ai