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Hello and welcome to World Business Report from the BBC World Service.
I'm Roger Hearing and on this edition, a leap in the shares of Oracle makes its co-founder briefly the world's richest man.
Also, what gentrification is doing to parts of Mexico City.
I rented here cost around 4,000 pesos a month in 2007.
Today, that same apartment costs more than 10 times as much.
Buy now, pay later firm Klana finally launches on Wall Street.
The Russian superyacht being auctioned by the US government, but no one's quite sure who owns it.
And why are young people complaining about burnout in the first years of their working lives?
But first, if you think you had a good day on Wednesday, just consider the man who became 100 billion richer.
Larry Ellison is the co-founder of Oracle database software company and Oracle shares surged 40 after it gave investors a surprisingly rosy outlook for its cloud infrastructure, business and artificial intelligence deals.
Now, Oracle may not be that well known outside the tech world, but it's been around since 1977.
The biggest websites, from Amazon.com to Yahoo.
And the biggest companies, from British Airways to General Motors.
Use Oracle for e-business.
In fact, that was from the 1990s, I think, 1997.
But Larry Ellison, whose net worth is tied to the company, now has $393 billion.
And that means, for a brief period, the title of the world's richest man went from...
Elon Musk to him.
But the firm's share price had shed some of those gains by the end of the day, putting Elon Musk back on top.
Well, if you want a comparison about Mr Ellison's wealth, it's around the same as the GDP of Pakistan.
Well, here's a little of what Mr Ellison thinks about his company's success, speaking a little while ago to Fox Business.
You know, my original goal when we started Oracle was to build a company of 50 people people I enjoyed going to work with every day.
It got to be a little bigger than that.
We have 150,000 people inside the company now.
Well, one man who's followed Larry Ellison's career with interest is Mike Malone, veteran Silicon Valley journalist and host of the Silicon Insider podcast.
He joins me now.
Mike, thanks for being with us.
What sort of man is Larry Ellison?
Well, he's kind of a complicated figure.
He's not transparent, let's put it that way.
He's not trying to be one of the boys like a lot of the other.
Executives wearing Silicon Valley, wearing leather jackets or, you know, work clothes and that sort of thing.
Larry dresses in suits.
And the closest comparison I think you could make to him in terms of his manner is an emperor.
He's a pasha.
He lives very well.
He's had six wives.
He owns an island in Hawaii.
And he's lived very well.
He's also known as a very ruthless businessman.
The old joke used to be your first year at Oracle, you thought it was the greatest job in the world.
The second year, you began to wonder if you were crazy.
And the third year, you sought therapy.
It's a tough place.
But...
So Larry Ellison, I talked to two women a few years ago.
I had lunch with them, two top executive women executives in Silicon Valley who worked for Larry.
And I said, why would you work for such a guy with his reputation?
And they said, because he's the smartest man about databases and thus AI in the world.
And he makes great decisions and he makes it exciting.
OK, that's it.
There's the contradictions of Larry Ellison.
It's an interesting picture of him.
And I mean, I suppose one of the things I should ask, Mike, for those who don't know, I mean, we.
We know about Oracle.
I guess some people have heard of it, not people who have heard of Apple or some of the other big tech firms.
But what it does, will you tell me what it is that it does that's so important?
Well, it's morphing right now into heavily cloud and AI, but it's always been about creating settings on the web for big companies like Google and that sort of thing.
Early on, they were in computer databases.
They're famous for buying up any company that looks like it might compete with them.
They buy up, or if it looks appealing.
And they're also notorious for almost never innovating in those areas again.
So, I mean, it's a remarkable thing, a 50-year-old company.
They don't last that long in Silicon Valley.
I mean, look at HP, look at Intel.
They got old.
But Oracle.
It just set a new record for its value and it jumped from 200—their previous high point was 280 billion.
For a while this week, it was $341 billion.
Their stock went up 41%.
For an ancient company, this is amazing.
And it's Larry again.
I mean, he no longer runs Oracle, but he kind of does.
But he's the chief technologist, and he spotted AI.
He bought after initially dismissing cloud.
He embraced it.
And now they're going to be powering companies like, oh, NVIDIA.
I mean, it's mainly and mainly open AI, which is a hot company because they're going to provide all the servers.
So Mike, let me ask you one question just briefly, which is these numbers are just mind-boggling, the amounts of money.
We seem to be at a point where the richest people in America seem to be even richer than they used to be, relatively speaking.
The tech area, the place where you are, Silicon Valley has really put this situation to a point of almost unprecedented wealth for certain individuals, hasn't it?
Yeah, some of these individuals and companies are the wealthiest in human history.
I think Oracle's right on the brink of turning the Magnificent Seven into the Magnificent Eight, the moment they cross a trillion dollars in sales.
Part of it is because we changed the law in this country a number of years back.
Where companies could change the nature of the way they run their business.
They can – and the United States government wasn't doing antitrust, so you get a company like –.
Well, like Facebook, acquiring one hot company after another, just jumping from stone to stone across the river to greater wealth.
And Ellison's been doing that for 30 years.
Right. and has the money to show for it.
Mike, thank you so much for being with us.
Mike Malone there looking at Larry Ellison and the success of his company, Oracle.
Let's bring in Susan Schmidt now, Portfolio Manager at Exchange Capital Resources in Chicago.
Susan, thanks for being with us here on World Business Report.
First of all, the Oracle share prices.
I mean it was interesting that, just for a fraction of a moment really, Larry Ellison did go higher than Elon Musk in terms of wealth.
Then it came back.
So this was a sort of bounce.
But Oracle's a very strong company, isn't it?
It is a very strong company.
It's been a strong player in the industry throughout.
But what is interesting today is the market's reaction to this really Very strong number.
The number is about the backlog, the business that will be developing.
And so it's not the most recent quarter but really projections out for the next four years and tremendous amounts of growth that are expected, showing that Oracle has moved solidly into the cloud computing business and AI offering that cloud service, competing with the likes of Microsoft Amazon Alphabet, Google in their cloud-based offerings, and that Oracle has hit the demand, which is an indication for investors as well that that AI trend continues to be extremely strong, that there is so much demand for it.
Yeah, it's interesting because we've certainly heard people say, oh, well, the AI –
The situation is really a bubble in the end.
Investors are putting too much behind it and it could all disappear quickly.
But clearly investors haven't taken that thought on, have they?
Well, customers for Oracle certainly haven't.
There is question of how soon will profitability really show up.
And investors have been looking for that.
But equally important to investors is the long-term trend of growth.
And certainly what we're seeing with the Oracle numbers is people are less worried about the profitability.
Businesses want to have the capability right now and the profitability will come in the future.
OK, let's turn our thoughts to the rest of the market.
The S&P 500 and the Nasdaq composite rose to new highs, closing highs today.
So clearly something is, you know, quite apart from what Oracle's doing, is boosting them.
What's going on in the investors' minds?
Well, investors are optimistic that at the Fed meeting the central bank for the US, the meeting next week the Fed will lower interest rates by a quarter of a percent.
And that will be the beginning of the Fed starting to take down interest rates.
They've held off on that as there's been so much uncertainty around the impact that tariffs would have on prices and the economy.
And again, still concerns about warding off inflation.
Investors now feel that economic data supports a slight lowering of rates.
Almost 90 percent of the market thinks that that quarter percent is going to come off.
That's really imbued them with an optimism about companies and their profitability.
Interesting, isn't it?
Yes, we'll see if it all comes right, as they expect.
Thanks so much, Susan.
Susan Schmidt there.
Now, there have been a series of protests in Mexico City about increasing gentrification.
That's when the character of a poor urban area is changed by wealthier people moving in, improving housing and attracting new businesses, but often displacing current inhabitants in the process.
Well, in the neighbourhood of La Condesa...
Activists estimate as many as one in five homes is now a short-term rental or tourist letting, forcing out the long-term residents.
The BBC's Will Grant reports now from Mexico City.
The timing of the anti-gentrification protest in Mexico City was no coincidence.
The 4th of July, US Independence Day.
It began as a peaceful march over aggressive rent hikes, unregulated holiday lettings and the endless influx of Americans and Europeans into the capital's trendy neighbourhoods of La Condesa and Roma, but it soon descended into violence.
Radical demonstrators attacked coffee shops and boutique stores aimed at tourists, while chanting Gringos out.
Two days later, President Claudia Sheinbaum, who'd previously served as the mayor of Mexico City, condemned the protest as xenophobic.
No matter how legitimate the cause, as with gentrification, the demand can never be to just say get out to people of other nationalities, she said.
Her administration would support the mayor, Clara Brugada, in tackling the issue, she added.
Mayor Brugada then set out a 14-point plan to regulate rent prices, protect long-term residents and build new social housing at affordable prices.
For many, though, the mayor's promises came too late.
Activist Sergio Gonzalez says in the past decade his group has recorded more than 4000 cases of forced displacement of long-term residents from his neighborhood of La Juarez alone.
He was one of them.
The first apartment I rented here cost around 4,000 pesos a month in 2007.
Today that same apartment costs more than 10 times as much.
In La Juarez, I met Erika Aguilar, whose family had lived in the same building for 45 years.
In March 2017, officials came to every apartment in the building and told us we had until the end of the month to vacate the premises.
Erica now lives almost two hours away by public transport.
Her old home is now a building site, as the new owners convert it into luxury apartments.
Combined with the high cost of living in the US, the draw of the leafy streets of Condesa is obvious.
It's peaceful.
We've really enjoyed it.
Alexis and Richard also Brooks, are on a short trip to Mexico City from Portland Oregon with, they say, half a mind to maybe settle here one day.
Obviously we don't want to contribute to gentrification.
I think, as long as you treat those around you with respect and you try to be a part of the community, I think it goes a lot further.
Learn the language.
But for displaced resident Erika Aguilar, the radical demonstrators don't represent her cause.
Still, she has advice to anyone planning to relocate to Mexico City.
Learn Spanish and pay your taxes.
Will Grant reporting there from Mexico City.
The U.S. electric grid is approaching a breaking point.
As demand soars from data centers and home energy use, our aging infrastructure can't keep up.
And the Department of Energy warns that without action, blackouts could surge 100-fold by 2030.
The good news?
One solution is already here.
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In business, they say you can have better, cheaper or faster, but you only get to pick two.
What if you could have all three at the same time?
That's exactly what Cohere, Thomson Reuters and Specialized Bikes have, since they upgraded to the next generation of the cloud Oracle Cloud Infrastructure.
OCI is the blazing fast platform for your infrastructure, database application development and AI needs, where you can run any workload in a high availability, consistently high performance environment and spend less than you would with other clouds.
How is it faster?
OCI's block storage gives you more operations per second.
Cheaper?
OCI costs up to 50% less for computing, 70% less for storage, and 80% less for networking.
Better?
In test after test, OCI customers report lower latency and higher bandwidth versus other clouds.
This is the cloud built for AI and all your biggest workloads right now with zero commitment.
Try OCI for free.
Head to Oracle dot com slash strategic.
That's Oracle dot com slash strategic.
You're with World Business Report from the BBC World Service.
Now Klarna is a Swedish fintech company that's dominated the buy now, pay later lending business internationally.
Roughly 93 million active users across 26 countries.
Well, now it's launched on the New York Stock Exchange with shares immediately jumping in value, worth around 19 billion, and it marks a significant milestone for the Swedish lending giant, which has cast itself as a challenger to credit cards and traditional banks.
But the firm has faced questions about the risk that its business model could lead people to spend beyond their means.
Well, the company's launch had been cancelled earlier this year amid global uncertainty over tariffs and inflation.
So I asked one of the leading climate investors, Johan Hegland, founding partner and CEO of TAIX, if he was pleased at what had now happened.
The listing itself.
It looks very promising and we're very happy that finally it is happening after a few years wait.
In some sense they've been pretty unlucky with the timing, but now it's finally happened and we're very happy about it.
How big a deal then is this listing for Swedish fintech?
Because, I mean, it's a big number.
It's a big name.
Does it make a big difference?
I would say it's a very kind of emotional day.
It's a historical day.
I mean for Klarna, Sweden and European fintech.
It's a lot of emotions in that sense that it means so much for the whole ecosystem, especially Klarna.
You know the big juggernaut.
And I think also for the whole ecosystem.
You know now you're going to have more business angels.
There's going to be more companies.
So there's so much positive things that will come out of this.
Because startups in Europe have had, well, I mean, it's all been a bit sluggish in recent years.
I mean, got inflation, global tariff uncertainty, cost of living, all these things.
Do you think this successful listing actually suggests that perhaps a bit more confidence.
Yes, and I think also that is why we think this day is so important that it's not only about Klarna.
Corvive and Figma, they did very strong IPOs before the summer.
They are not as strong issues anymore.
And hopefully, you know, this could be a way of kind of turning the page.
So what we think is that, if this looks like to be a very successful IPO, and if this continues, we do believe that, you know, there's going to be more IPOs coming.
I think this could open the floodgates.
Well, I would say it certainly suggests it is successful, because we're just getting news that in fact the shares have opened at 52 in New York, against 40 IPO price.
So I guess you're pleased with that.
Yeah, that's amazing news, because we've just been waiting all day.
We hear a lot of rumours, but nothing confirmed, so that's really good to hear.
Klarna have gone past a big hurdle.
What do you hope to see from Klarna as a result of all this?
I think that they are on a very, very interesting path.
And also the timing for them to go public is.
I think it's really good because they have a really strong foundation.
You know, they're a global company.
They are broadening the products.
It's a growth story in the US.
It's a pretty immature market and they are, you know, growing really fast.
So I think it's going to be three main focuses.
That I mean obviously keep the growth strong in the US.
I think that would be the most important thing.
And then, of course, going from you know the BNPL to be, you know, a kind of broader product in that sense, to become more like a you know digital bank in that sense.
And the third one obviously will be also to see if they can reach profitability.
But I don't think in the short term that is the most important part.
But I think those three will be the focus areas going ahead.
You mentioned about going away from the NPL buy now, pay later because I mean that is an industry that has been very successful but it certainly had some clouds over it, people even ethically wondering about how good it is and its effect on societies where it exists.
I mean, would you feel more comfortable being involved with a company that was perhaps more like a bank?
I still think it's the bread and butter as of today.
And I think that they are in a very strong position so they can start adding new features and new products.
And that is also why I think it's a really good timing to go public, because they have this kind of you know strong equity story about what's going to happen next.
And we also see that, for example, as a company like Revolut, how successful they are.
I think it's an inspiration for Klarna and many other fintechs to go in that kind of direction.
Johan Heglund there.
Now, how would you like to buy a luxury yacht with a helicopter pad pool, jacuzzi and a stunning winter garden on the sundeck?
Well, it's worth at least $325 million.
There's just a slight problem of ownership. the US Justice Department seized the boat, the Amadea, in Fiji in 2022, saying it belonged to Solomon Kurimov, a politically connected Russian billionaire who was under sanctions. but there's been a long court case by another Russian claiming he is the owner.
And now US authorities have put the boat up for auction.
If you do buy the Amadea currently birthed at a shipyard in San Diego California, and sailing out of US waters.
He could be seized by the agents of the man who says it was always his.
A complicated story, as I heard from Aishwarya Kavi of The New York Times.
So the US government seized the Amadea several years ago under the Biden administration, under this Department of Justice program called KleptoCapture.
And it was part of this effort that has since been disbanded to kind of crack down on Russian oligarchs who are very close to Vladimir Putin in response to the Russian war in Ukraine, hoping to get close to those who are close to Vladimir Putin and who have amassed a large amount of wealth through that proximity.
And so seizing this yacht that was anchored in Fiji and convincing Fijian authorities that a Russian oligarch who has been sanctioned by the US owns this yacht was a pretty big win for the administration at that time.
And that's sort of how the US ended up with it in its hands.
And when you say seized it, who did they actually seize it from?
Were they clear who owned it, who the oligarch was?
Right.
So the oligarch that they claim was the owner of the yacht or they have seized it from is a different man than the one who is now claiming, or we can call the paper owner of the yacht.
So the oligarch that the claims owns the yacht is a man named Suleiman Karimov.
And he has a net worth in the billions.
And he's very close to Vladimir Putin.
But the man who owns it on paper and whose ownership might be a problem for any potential owner of this yacht down the line.
If someone bids and wins the auction arranged by the US, that man is a different man Edward Kudinatov.
So Kudinatov claims ownership of this yacht, says it's him.
But I believe there's been a legal judgment in the US that it isn't him.
I mean, it's very complicated, isn't it?
So the way that this has played out has been in court, in US federal court, and a judge has ruled actually that Kudanayatov, who is being represented by a firm in the US, doesn't really have a right to dispute auctioning of the yacht.
And I believe he's still trying to appeal that, but he hasn't been successful because the yacht is now being put up for sale.
But the big catch here is that Anyone who buys the yacht might want to sail it outside of the US, into international waters, into the waters of other countries who might not perceive.
US sanctions on Russia in the same way that the US does, and who might be amenable to a lawsuit against the US for seizing the yacht from Mr Kudinatov?
So you could buy this really nice yacht with all its lovely winter garden on the sundeck, helicopter pad pool, jacuzzi and all that, but you can only sail it around the coast of the US effectively.
Well, you could try.
You could try sailing it to international waters and see what happens.
But his lawyers, Mr. Kornatov's lawyers, are very firm that he wants his yacht back.
I mean, as you said, it's very elaborately designed and decorated for a very particular owner.
Yeah.
You know, these yachts are not really something that you pick a base model and you run with that.
It's been customized and done up with all these extensive extra features.
And Mr. Kurnatov says that it's his yacht and he wants it back.
So is it expected that there will be lots of bids then for this yacht?
Well, we don't really know.
Bidding closed at 2pm Eastern on September 10th.
So we will see if anyone has even bid at all.
Probably a bidder will get to set up quite a bit of a deal because it's worth quite a bit more than the 10 million that you had to put as a hold to even submit a bid in the first place.
And with all the legal issues, experts are saying that people are not going to necessarily line up, even at a steep discount.
Aishwarya Karvi there of the New York Times.
Now Gen Z or Gen Zed.
Those born in the late 1990s, early 2000s are the newest generation to enter the workforce.
But many say they already feel burned out.
So what's driving Gen Z's discontent in the workplace?
The BBC's Megan Lawton's been finding out.
We're starting with a scroll through TikTok.
On this app alone, there are over 84 million posts about burnout.
From what it sounds like...
To the symptoms and statistics.
If you are miserable at your job, you're not alone.
98% of Gen Z is burned out by a new report.
Beneath this TikTok from anti-work girlboss, I saw a comment from Sarah which said the main issue is that we're working just as hard as previous generations, but we can't afford anything they used to.
I think the main reason why me and my friends experience burnout is because we grew up watching our parents live a comfortable life.
And that's just not a reality for us anymore.
And that's a lot of the reason why companies are not incentivizing us to stay there.
Me and my friends experience burnout is because we work hard for a company.
Our wages are not keeping up with inflation.
So while our parents were able to afford vacations and afford homes, As simple as homes, we're not able to experience those types of rewards.
There are plenty of studies that can be found online about burnout and Gen Z.
23% of young workers are saying that they're dealing with unmanageable stress.
I can't find a true definition for unmanageable stress.
A study from 2022 has gained a lot of attention on TikTok.
It's from US health insurance firm Cigna and suggests...
98% of Gen Z is burned out by a new report.
They surveyed close to 12000 people aged 18 to 65 in 15 countries, including China India Kenya, the US and UK.
Okay, well, what's your social and emotional well-being looking like?
And how do we attend to that?
Jordan travers is a psychologist and clinical director at awake therapy in new jersey in the us.
A common denominator that often goes undiscussed with burnout is unrealistic expectations.
Jordan is a millennial and says the way.
Younger generations are raised to think that the job world is their oyster and their well-being a top priority has built somewhat unrealistic expectations.
Not only unrealistic expectations for the person.
Maybe of unrealistic expectations on what the criteria are to be promoted, to move up the corporate or hierarchical ladder, or how to position ourselves to propel ourselves forward professionally.
Of course, we can't stereotype a whole generation.
But Jordan points out Gen Z tend to be more self-aware and take mental health seriously.
But these values, Jordan says, can clash with workplaces that still prioritise productivity over wellbeing.
Megan Lawton reporting there on the crisis for Gen Z and entering the workforce and how they feel about it.
That's it from World Business Report for me and the rest of the team.
Bye-bye.
