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>>daryl: coming up next on insights on pbs hawaii is hawaii in a real estate bubble? [intro music] >>daryl: aloha and welcome toinsights on pbs hawaii. i'm daryl huff, with hawaiinews now. for many hawai'i families,the dream of owning a home seems more and more remote.with mainland transplants are often stunned by the cost ofhousing when they come to paradise.meanwhile, wealthy foreign

buyers seem unconcerned aboutprices as they seek a safe place to invest in the world'sfragile economy. this year, we've seen soaringprices and a sharp increase in sales.is this evidence we're in a real estate bubble or thenatural result of low inventory, high cost todevelop and high demand. where will hawaii's realestate market be going next. we always like to hear fromviews like you so share with us your questions andcomments by calling

9731000 on oahu or 800-24847if you're on a neighbor island. you can alsowatch insights streamed live on pbs hawai'i.click on the title or find us on twitter at pbs hawai'i.to our guests. stephany sofos is a graduateof the university of hawaii at manoa majoring in history andminored in economics. real estate broker appraiser.author of the book untold stories of real estate diva.history of the hawai'i through real estate agentworking in the business for

past 40 years.sumner la croix is a professor in the departmentof economics and university of hawaii at manoa, researchfellow at uhero. he identifies several factorsthat contribute to the high housing price.scott higashi is executive vice-president for locationsformerly known as prudential location.oversees more than 300 agentings in six officesstatewide throughout the year.location research department

tracks sales activity formore than 350 hawai'i neighborhoods.and jon whittington is president of compass homeloans, a direct mortgage banking company based inhawai'i. prior to launching compass inlate 2014, he was president of american savings bank's homeloans division where he worked since 2000 were 9.the career mortgage banker, he spent the bulk of hiscareer with the country wide home loans prime consumermarkets division.

let's just start off to makethings clear. sumner la croix, who what isa bubble when people talk about a real estate bubble.what does that mean? >> when people talk about abubble, they're talking about a large sustained increaseasset price. pushes the asset price farabove its fundamental value. the reason people argue aboutbubbles whether or not they exist is what exactly is thefundamental a.m. value of an asset.some would say market value is

the value.others would say, it's going to come back down.forces of the market sentiment.>>daryl: when we talk about a bubble, always fear thepossibility of bursting. isn't that really kind of thedefinition too? >> most of the time, whenafter the fact, identified a bubble.bursting. people start to buy tulips.then all of a sudden, the prices of tulips start to goup.

think they're goodinvestments. prices go up further one day,the merrie go round stops and the prices of tulips fall backdown to relatively low levels.>>daryl: scott higashi from locations.in your career, have you seen bubbles and what does it feellike when you're in one. i think we saw was economicdown turn. saw this dramatic reductionin the number of sales and then values dropped.but was interesting about

hawai'i in that cycle, ishawai'i's values department drop in the same percentagethat you saw in other parts of the country.so i mean, part of the insulation in hawai'i has toa lot to do with some of the factors you brought up in yourintroduction. inventory constraints,regulatory environment that makes it hard to develop, sowe did see a down turn in my short career real estate.and it showed all the signs of the thing that you wouldexpect, people feeling a lack

of confidence, in owning orbuying a home, and fewer sales.but values, you know, actually didn't fall presiptusly here on oahu. >> not how it felt.>> a lot of real estate has to do with confidence and how youfeel about at that marketplace.>>daryl: jon whittington, you're the mortgage banker inthe crowd here. there was a lot of blameplaced on the mortgage industry back when we had thething that we all could

probably argue is a bubble.2008. 2009 crash.has the mortgages industry changed to prevent this fromhappening again in. >> changed dramatically.kind of the token legislation that came behind after thatwas the frank legislation and essentially, a lot of reasonsled up to that the mortgage melted down.and you can find fault along the way.started wall street, rating agencies.since then, with more on

consumer side and protectionsplaced on the consumer, as a lend, we're, and rightly so,many ways, constrained from being able to get that elasticwith credit again. you can argue goes back to theclinton administration trying to make homeownershipas a right versus a privilege and the went behind that.manifested itself on that. today we had very, tightcredit boxes, so people couldn't qualify what thatmaybe should. starting to see talk of that.coming from a very tight,

tight box.coming bit, pendulum swinging a little bit over.some more people can qualify now.just recently, fannie mae and freddie mac, largestinvestors in home loans, opened up a lower down paymentfor higher price. which is a beneficial to thewell qualified borrowers. credit worthy.talk more later about the decision it's people can makewhat the opportunities are. stephany sofos, your ownexperience four years, what

whats it look eis process likegoing through the bubble the ones that you recall.>> well, first of all, i think we are in a bubble.and i think it's going to pop. when it does, we don't know.it could be because of politics or could be a naturaldisaster. something is going to happenand it will adjust. this is about i've been inabout four cycles four our five, this one is, this marketis the most odd market for me. never seen a market like this.>>daryl: you mean this time

you're talking about?>> this time right now. never seen a market like this.because prior to? market, there were waves and in the 60it's, you had the canadians come n seventies, you hadsaudis come in. eighties, late eighties, youhad the japanese come in. 90's, you had kalai chinese.early 2,000s, you had the caucasians from the mainland.this market, you have everybody.coming into our market including russians.i've never seen russians.

they're coming in with cash.they purchased everything all the luxury market in sanfrancisco and california and la and new york, and now,they're coming to hawai'i. so i guess everybody is comingin to land bank. >>daryl: do you think thisbubble as you see it across the board or particular pieceof the market? all that description you gave medidn't sound like investment so much in middle classhousing but the high end such, kind of stuff that's going inkakaako, waikiki.

i think it's across the board.across the market. seeing people investing in$5 million luxury homes. it's everywhere.>>daryl: are you seeing the same thing?>> no doubt we're seeing different kinds investment.i will, my friends stephanie, should never short ofopinion, i actually don't think we're in a one and idon't see that. i think what's differentabout this cycle versus the last one is the rate ofappreciation is somewhat

moderated.i just feel like if we look at the past cycles, if you indexthem all and summer probably better at the indexingproblem, i just see with that we're probably in year six ofa ten year cycle. is the way i would look at it.i feel there's still more appreciation to come andstability in the market. inventory levels at moderateprice points certainly around the medians for single familyand for condos and below, are really tight.competition for those

properties show up in theamount of bid-ups that take place in those price points.but i do think that in the higher price points,certainly over $2 million and maybe even $1.7 million, andup, those are tight markets. i don't think there's enoughbuyers in that marketplace to support the inventory on themarket and that has slowed. >>daryl: in the situation asdescribed by scott, may not think that there's a bubble,it sounds like you did have too much building and for alimited market at the high

end, do you think this theremight be a bubble there? >> no.i don't think there's a bubble.i think i high end may have had a surge in prices.to have a bubble, you have to have a massive surge.something like we saw in las vegas.seeing run-ups in the your of 100, 150% relatively shortperiod. >> i can tell you i've lookedat, appraiser and i do a lot of residential appraisalwork.

i do a lot of apartmentsbuildings work and all of that.and three years ago, apartment buildings, therewere selling for 150 a door. unit.now, they're $375,000 a door. that's incredible.three years? then i'm seeing places like diamond head andkahala, they were a million seven and now they're 3.4.in three years. that's too high.going up too high. >> i likeel argument, if welook back to prices were back

in 2005, 2006, that was theheight of the previous boom before we had the down turndue to the great recession. if you adjust for inflation,if you adjust housing prices for inflation, since then,barely gotten back up to where we were in 2005.i mean, there have been run-ups in prices. once youtake inflation out, it's not that great.then what would explain this? i do agree with stephanie thatoutside buyers here have always been a force in themarket.

there's times where theydominate the market. also think that inside buyersare important too. if you look at housing prices,many times, determined by swings in the local economy.not just by how many foreign buyers are here.at the very upper end, foreign buyers make a big difference.>>daryl: let me ask john. the mortgage business prettycarefully tracks whether properties are getting toohigh a value for what the mortgage will support.you guys watch for this.

because you're the onesultimately at risk. so what are you seeing in thatrespect? do you feel that there's a lot of propertiesthat are over valued, are people coming in and payingcash regardless of the mortgage?>> i think careful. we see the market onetransaction at a time. every transaction we do has anappraisal. tied to it.we can sit there and say, where are we, where is it.the bid-ups, kind of median

mark e. we see that too.and the borrowers that are buying at market, appraisersupporting the value even at the bid-up price.if there will a difference between the bitter price andwhat the sales appraisal, appraisal value is, it's kindof marginal. so people are still able toget into those homes. the difference is if you'regoing to buy pay higher than what the appraisal is, come upwith the difference in cash. that's a lot of cash.you're going to have problem

doing that we're not seeing alot of that. cash buyers you mentioned,they're not as no, ma'am independent they were 2 or 3years ago. not as prominent 2 or 3 yearsago. we had cash.now it's 20 to 25% range. >>daryl: scott higashi fromlocations, question from sam in kauai.how far can prices still go up if wages stay stagnant? isthis a fair appraisal of the economy? awkward to a lot ofpeople that we're hearing

that wages have not risen ata pace, yet we're seeing the housing prices go up.what is the experience of buyers out there of thatsituation? >> it's hard. i think one ofthe things that we're facing is wages may be haven't grownor haven't kept payson the same pace as prices.there's not more land to build more homes and the choicesdevelopers have to make when we're building new homes iscontending with the regulatory environment,higher construction costs,

which are going to drive theirprice of homes higher and then as you have people with lowinterest rates competing for homes, so john mentioned,bid-ups for example in aiea, pearl city, mililanimakakilo, seeing up to 25% of the homes are going for morethan asking. doesn't count the homes thatactually went at asking. in some case, not only pricesmeeting the market demand, but exceeding those price andthe dilemma is i don't think we can build houses fastenough to absorb that.

it is a dilemma.i would agree with the individual calling with thequestion that i don't know that wage growth and homeprices are keeping pace with each other in hawai'i.>>daryl: sumner la croix, what do the numbers show.>> median wage, person that 50% of the people are blow.50% above. in the wage earningdistribution. wages haven't changed muchsince the waihee or reagan administration.pretty much flat.

it's personal income.being inned substantially last couple of years.there was about 4% rise in real personal income.in 2014. about 5% rise in 2015.wages have been fine, other sources of income havecontributed to people's ability to finance a home.>>daryl: so maybe this a question for.>>stephanie: any. you talked about the offoffshore money coming innd being spread out around themarket.

we hear phenomenal aboutindividual buyers bidding up properties.would that still be a bubble to you if what's driving it isthis demand from actual people who live here too?>> i think, yeah. i think in a it's, there is abubble. 5% increase of someone'sincome, when your housing are rising 30% is still a biggamble. and the real estate market,the reason why everything is going up, is there is demandbecause there's two reasons.

the local people want theirpiece of paradise. and investors want theirpiece of paradise, plus they want to invest in a safeenvironment. investor came to me and said,i want to keep my investment where the greatest militaryis located so that i will know that my investment will beprotected. to my face.thought, wow, that's interesting.>> question. >>daryl: how much has the hugemilitary presence affect

housing costs?>> huge. huge.>>daryl: does everybody here agree about that? do we havea large enough population to affect the whole market.>> you have a lot of military who have their militaryallowance so they can go in and rent at much higher levelthatten a local person can. so that drives up the higher,you have higher rent which is higher income of return.investment. which means higher prices.so people will go out and buy

a bigger house, renovate it,and this rent to somebody who can pay for that higher rent.>>daryl: this is an interesting question.i think that one of the things that we would like to explorehere is the effective a bubble on actual decision-makingprocess that goes on in, say, a local buyer.the question, what should a home buyer do if she or he islooking to buy. let me start with scotthigashi. still time to buy or shouldpeople be nervous?

>>i don't think people shouldbe nervous. i think it's time to buy.affordability in hawai'i has a lot do with interest rates.interest rate environment has been favorable.folks have gotten used to this as a new normal.when you see interest rates, people interest rates go up,people flood the market thinking we've got to hurry.first thing, a lot of folks are so afraid of the process,don't get prequalified and find out who they can afford.a lot of times that

surprises.they over estimate the amount they need for a down payment.part of the process so explore that affordability first andthen the world actually opens up.it's not true that there is nothing available for inevery price point to buy that that's simply not the case.i think one. things, one of the barriers is the fear ofthe process and then thinking the read the paper.it's so sense ea expensive. i don't know how we're goingdo that.

i lot of people are payingrent at equivalent level of at what a mortgage would costthem per month. because of that, barriers orfear or perception don't take the first step.great time do that. >>daryl: whittingtoningcalled from tom from waikiki. what role cast a mortgageindustry pay in raising the cost of housing.you've had this pretty consistently low interestrates now for a while. and he's describing wherepeople may be coming to the

table now, going, maybe thisis real. i mean, what do you any? doyou think that these costs that are going up might bebecause interest rates are so low? what happens ifsuddenly, interest rates pick up?>> absolutely. with low interest rates.that expands affordability. because your payments arelower. therefore, you can make lessmoney to be able to afford it. and interest rates do go up,affordability gets

compressed a little bit.definitely interest rates have an impact on hawai'ihousing. anecdotal.hawai'i seems to find a way. honolulu seems to find a way.whether it's the typical thing that we see, notnecessarily debt to income ratio.it's more of the down payment side of it.typically, you can get 0% down.get 3% down and not be a veteran.and a the lot many he pahoa he

doesn't know that.you-it lot of people don't know that.you may hui up with family member or parents and dosomething. and since, finding in hawaiifinding a way, we're giving away quality of life though.>> could be. if that's your definition ofquality of life. i'm no here to arguedefinition. but some people really, enjoyhaving multigenerational living in their homes.where with when i went to away

to college, my dad turned myroom into a den. >> remembering that supplyhere is relatively fixed. we just have not added verymuch to the supply of housing in the hawai'i over it's lastten, 12 years. ho'opili, just allowed us togo through, that's lpn been in the planning process for overten years. koa ridge has been around fora long time in the planning process.those are the only additionsnd koa ridge stillhasn't been approved.

ho'opili 12,000 homessupposed to come in over the next 20 years.only big housing development supposed to come in.maybe 500 plus homes per year. that will help alleviate someof the demand that's coming about for extra housing.continued population growth, economy tends to kind of slowbut okay growth, as you hear predicts, we're going to seemore people coming here. not to have homes put them in.bid up prices. extra demand bids up prices.>>daryl: you have a fan out

there, stephany sofos righton the money. let me ask.pretty much alone. why do you feel it's importantto raise this alarm? saying we're in a bubble, is anlarging thing to a lot of people.why do you feel it's important to say it.>> because you need to be aware of what's going on.and go into your investment with open eyes.i tell people that if, i'm doing some transactions rightnow.

i tell people, you're going ifyou can afford it, buy it. because historically,hawai'i property has always gone up.it goes down sometimes in recession, but the recessionshave been much more mild than on mainland.when the great recession went down, places went down from 10to 70%. in hawai'i, it went down 10 to30%. so it's a good investmenthere. and if you can buy and hold,do it.

if it's affordable.you're going to be like there and struggling every day totry and make that mortgage payment, and you're cryingand you're worried that you're going to make that,don't do it. if you can do it, and you, itcan be a reasonable expense for you, in ten years, it willbe a great investment. it might not be a greatinvestment for the first two or three years, in ten years,it will be. >>daryl: gut wrenchingexperience to be underwater

on a mortgage.>> not that many, excuse me. not that many people inhawai'i have that situation. we did have foreclosureshere, about you not catastrophicically like lasvegas, arizona, san antonio, and parts of california.so we because again, what sumner said, people will comehere and there is a great desire for local people towant to have their piece of paradise and people coming inhere want their piece of paradise.that will continue to drive

the prices or keepsstability. maybe the prices willstabilize and go down with the recession.but it will keep everything stable.>> i like to, if you dent mind. talked about las vegas,california. inland i aminland empire. sand states.until hawai'i, we're based in honolulu.owner market in honolulu was maybe off 10% at the trough.where we saw the big impact

was in the resort residentialresort areas. kihei, wailea, kona, poipu.>> ko olina. right.we had a lot of mainland buyers.earlier came in and buy it, levied up homes thiscalifornia. most impacted in hawai'i.so i think it's important when we honor that happened there,leisure mainland market, stayed pretty strong throughthe, even through the worst. agree with that.i want to agree with some ea

something stephanie said.interesting thing about homeownership is you purchasethe home, and you fix your payments, and i think whenpeople think about the threat of a bubble, or the danger ofthose things, it's really in the event of selling.so you buy a home and live in it, your payments stay thesame. debt over time is going townand values do go up in hawai'i.historically, values move up. maybe not year one or two.over time.

it's hard to find a ten yearperiod of ownership where someone was upset with thedecision to buy a home. and live in it.>> so i think homeownership still the right path.>> if you were thinking about buying a home, try twodifferently scenarios. one is world economy weekweakens. dollar appreciates.driving foreign buyers away. leave the market.downward pressure in price. u is us enters minorrecession.

viewer visits.economy relatively strong. visitors from california.better incomes to people tourist jobs.find that some of the stock market weakness in china.means that people want to get some of their money out.good place to park your money. somewhere in the u.s.u.s. real estate investment is relatively safe.government doesn't come and confiscate your stuff.chinese economy underneath that relatively strong.may still find even though the

stock market, small part ofchinese economic scene is not doing have well.lots of wealth being generated and people want tostart coming here to continue to mark money here.if the exchange rates not so advantageous.you can come up with different scenario where hawaii onworld economy is going. thinking about if you'regoing to buy. recession is always going tohappen. only question is when.>>daryl: you're talking

about, again, same thingstephanie brought up. offshore money coming in.who can do anything about that.i had a panel here last week about kakaako and one of thepeople said, go out 8:00 at night and look at one of thosehighrises. supposed to be work forthhousing. middle class housing.you're going to see that 40% of the lights are dark.i mean, is it true that we have so much of that offshore moneyin here.

they'll say, this is an llc.locally registered company. local buyers.what do you guys think is really, is there a lot ofpeople from offshore buying into our real estate?.i think statistically. when you look at 2014, on theresidential side, anyway, from what we could tell, it'sabout 11 or is it% of the market.12% of the mark e. 2005, 25% of the market. offshore fromcalifornia, continental u.s. and asia or other place.complexion of the market has

changed.while folks may have bought and held from at that time, idon't see that more recent market is not being asinfluenced by that outside moon money.not in all pockets. whether that means, i thinkthey're present. offshore money is present.it's necessary. by the way.i think part of the buildings that you see coming up in theurban core require new markets to open.>>daryl: let me ask you.

>> agree to disagree with you.>> absolutely. go ahead.i can see you leaning that way.>> no. i think that foreignnationals are here and they're by buying left andright. i think that that's whatdriving a lot of your market. >> where they're from n i dosee a lot of them going into hawai'i llc's and so it looklike it's a. >>daryl: limited liabilitycorporation.

formed in hawai'i.(. right.corporation. and to bring their moneyoutside of their countries, with their governments,they're having to establish a business and whether it's arental business, or whatever they're doing, establishing,bringing it in over here. i did a lot of appraisal as theand there's a lot of foreign national names that i see thatare not local people. they're in every market.>>daryl: let me ask.

sumner la croix.is there any scientific track of this number and is there ared flag that goes up at some number.>> dbedt has a nice study they've been recently offoreign buyers in the market. no.i think another phenomena we're seeing in spill overoftourists into the market. we're seeing that we haven'tbuilt a lot of hotels in recent years.visitor days has been increasing.filling over into the

neighborhoods.push willing up prices. there isn't a really goodstudy of that done yet. >>j 1 ohn 0 : i remind ouraudience tonight we're exploring whether hawai'i isin a real estate bubble and other trends in theresidential sales mark e. we'd like to hear from you.973-1000 or 800-238-4847 calling from a neighborisland and i have already gotten a ton of calls.so let me kind of go through these.>> because we're so is

charming.>>daryl: you guys are bringing them out.i tell you. what should a family do thatmakes a needian income in hawai'i.can they afford a home? do they need pool their moneywith other family members? you mentioned thisphenomenon. really, when he talk about themedian income, is there something to buy?>> absolutely. i think no matter where youare, something for you.

i would say, median income,you can get by 0% down as long as you're in areas that areavailable for usda. guaranteed rural housing.and 0 down. loan is guaranteed.so the lender is safe. in that regard.and actually really careful to make she'ser you don't havetoo much debt against your home.that's aaron yeah that someone can do.i'm just kind comes to mind. if you, honorably dischargedveteran.

you've got va available toyou. also zero% down guaranteed.then you've got like 3 and quarter percent down on fha.many ways to get there. i think scott hit the head onthe nail earlier. talk to a lender.get prequalified. get preapproved.pull your credit. look at income and assets.tell you where you can go and had then connect you with areal estate agent and then go out and find the property.>> i was going to say, you have

a panel on kakaako.in that corridor, there's a building coming up thatactually will be for people who are making 100% of thearea median income in some cases less.two highrises coming up in the near future are designed forfolks in the 80% of the ami and up to 120.does it solve the whole problem and is it going tostill be competitive? absolutely.but i do think that there's going to be options.>>daryl: some of median

income, not going to be ableto buy a single family house, anywhere in the urban area.>> possibly not. i think that's where thechoices come in. absolutely true.the reality of our market is certain neighborhoods arehigher priced. and make it difficult.no doubt about that. >> i did see a kaimuki housewhich was 800 square feet. for $560,000.>> 2 bedroom,. >> 2 bedroom one bath on 2,000square feet.

you know, so it was a starterhome. >> i think i saw the line forthat house people running down the street,.>> another thing we're starting to see is familiesthat are squeezed into a home. lots of people living in thathouse. thinking about let's add thesecond story. third story.if it's allowed. >> whole other issue.construction costs are so high right now.barrier.

quick question.i don't know that we have a lot of leasehold places any more.question still kind of haunts some of the properties.leasehold. it's a lot cheaper.scott higashi, is leasehold safe to buy?>> it depends on the register of the lease.generally speaking, length of the lease.>> they're not that many left because a lot of them haveeither purchased the fee or period of conversion has beenallotted.

>> you have to know whatyou're baying. you have to know what you'rebay bying. couple of questions aboutpeople trying to, i think reed the market a little bit.question. are people buying homes theycan't afford like in 2005, 2007, scott whittington,you're the mortgage guy. are people buying house theycan't afford. >>unfortunately -- fortunatel y, no.becauseful they're getting a

mortgage, i can't see gettinga mortgage. not a mortgage guy.ones that get mortgages,. >> if you can get a mortgage,can you afford it. we're talking about doddfrank a little earlier. very restrictative.we have to call build and repay.you cannot do the loans. even if they have greatcommission or bonus income, still looking at that incomeover time, and can they afford that mortgage.if they cannot, actually we

get in trouble with ourregulators. so there is a bigger picturethan this. so things get overhe cantended because maybe your job changed the day after youclosed your loan. we can't have foresight on.validate everything, the day before loan funding, we'revalidating their employment to make sure they're there.>> in hawai'i, market, which is always been cyclical,we're always trying to read the cars.look for the canary in the

coal mine that is going totell you the boom is over and drop is about to start.roy from waikiki. what will happen if a lot ofhome sellers start to cash out and sell? what do you think?>> i'm not quite sure why that would happen.i think if people -- there's a big demand here.the reason why there's a big demand to be here is becausethis is great place to live. there's really good amenitieshere. rain good weather to the hosthawaiian culture, to the

water.to the natural beauty of the place.those of us who live here sometimes get caught up in thetraffic. if you're living in west oahuand commuting into downtown. understandable why you getcaught up in the traffic. still a very high amenityplace. people decide they want tocash out and prices start to fall a bit, others willfollow. and decide to come to hawai'i.>> what about the real estate

flippers? are they at riskat all? scott higashi? >> yeah.i don't think there is a flip market.i just don't recommend that. you know, i think the adventof these great tv shows that give these fansful ideas, buya place, fix it up and flip it. i don't think our, marketbehaves that way. >> i've seen a lot offlippers. i don't know if they're good.but they're doing it and some of them have made money.some of them haven't.

but flippers will get burnedin the end. because very, it's tooexpensive and but they're buying it for 500.putting 150. flipping it right now.kailua is incredible. kailua coconut grove wasalways considered the dregs area.and small, it was small lots with single familyconstruction. and last year, it hit athousand dollars a square foot.that's kakaako prices.

that's diamond head prices.i was like, oh, my god. how far is this going to go?that's just it's incredible and there are a lot offlippers in kailua right now. >>daryl: the questions arecoming in. along those lines.about neighborhoods that have traditionally had affordablehouses, kauai, big island, and people are asking, what isgoing to happen to our communities? rising pricegoing to start changing the nature of our communities?scott?

>> absolutely.i mean, i think that when you have that kind ofenvironment, it will change the nature of the prices.it's unavoidable. the hard part about theneighbor islands have when the economic down turn occur,it was much harder on the neighbor island communities.still not seeing where those prices are recovered in full.on like oahu where they continue to accelerate.neighbor island markets do behavior very differently andwill is a lot of outside

influence in particular theresort markets. traditionally residentialmarket, i clearly flip in the phenomenal flipping canabsolutely affect values. >>daryl: interestingquestion. it was huge problem.it was a question about, i could see a fixed incomeperson asking this question. they're seeing that theneighborhoods pricing up and their property taxes goingup. to point where they may be paypaying more, hawai'i is low

property price.state. it's still scary for them.jon whittington. are we seeing people get introuble because of the property taxes?>> no. not so much.hawai'i has the relatively low property tax compared toother place on the mainland. i can hear city councilsaying, we can't raise property taxes.>> we get taxed in every other way.>> we're like number one when

you put all the taxes that wepay and g.e.t. that's 5% right off of everydollar you earn. and your rent and on your, onevery service you use. i mean, we are the highesttaxed state in the nation. and when you say real propertytaxes are low, that's not a real issue.that's a nonissue because if that tax keeps going up,that's going to be go right to the renters and renters aregoing to be displaced. we have to balance.we can't be taxing us every

which way.we've got to calm down on taxes.>>daryl: you're making me, i got to read this question.stephanie sofos consider running for mayor? okay.>> i would probably go postal. if that would happen.>> congratulations. >>daryl: this is a i have tokeep controlling it. because we're moving rightalong here. again, i asked about thecanary in the coal mine. what should people bewatching out for? what is

the statisticalpsychological, what is the thing that could trigger thenext trending down? sumner? >> kind of decline in tourism.certainly, if we were looking out there, the this 30%decline in the value of the japanese yen.of the new zealand dollar, australian dollar, canadiandollar, all phenomenal made it much more expensive tovisit here. numbers have been robust fortourism. doesn't mean within day,people are going to wake up

and say, let's go to mexico.if they're looking for a vacation, find things likemexico vacation is much cheaper.cube starts to move forward in the tourism industry, we maystart to find more competition there too.there could be a recession coming about.>>daryl: sudden shocks. >> hurricane ripping throughhere. >> canary in the coal mine.inventories big indicator where we are in a cycle.we're like 3 months right

knew, ininventory.that what does that mean if no more homes came on the markettoday, the amount of velocity in the market of peoplebuying, 3 months, after 3 months, you would have noinventory left. >> basically have able homesgood enough for 3 months at the rate the market is goingnow. amount of time the homes arespending on the market on average,-market on average,still about 40 days. we've seen times in hawaiiwhere that could be months.

many months.so i think right now, we're not seeing -- i thinkconsumer confidence at least from what we see, we do a lotof first time home buyers that trepidation.and think folks don't, are confident that they're goingto have a job or don't have good employment outlook.don't feel confident. don't buy a house.think if that creeps into the economy, i think that's goingto be tough. that's when you start to seevalues drop.

things take longer to sell.sellers have to back off a little bit and don't getaggressive. listing their homes.when sellers put their home on the market, know theneighborhood is going more and seller gets more and nextseller gets more, moves price up.part of it is lack of inventory.you would have a neighborhood you wouldn't thought, how dothey get these prices. if it's the only home on themarket and people really want

it, more than one person wantsit, supply and demand says, they're going to bid that up.>> i do know the length of time was 30 to 45 days a year ago.now, it's 90 days. 3 months.so there is a, it's starting to stretch out.so that shows you that the market is slowing down.>> right balance point. not quite a seller's market.not a buyer's market yet. >> 60 to 90 days.i think this is actually a better market than it was ayear ago because it was more

of a frenzy a year ago.it seemed to have peeked in 2004 and i started to see thetrend going down in june of 2015.so now, things are starting to stretch out a little bit moreand buyers are waiting a will longer and sellers arebecoming more realistic. so i'm starting to see pricereductions. across the board.i see people willing to negotiate.before, no one would negotiate with you.they would just say, this is

my price and i'm going to putall offers to the sellernd you might be lucky if you get usto accept it. inouye, they're saying, okay,how can i help you? >>daryl: it seems like youwere, do you feel like we're hitting a crest here?.i really don't. i still see that we're medianhome prices are still increasing.>> economists look at history and we're looking at what'scurrently going on. you have to remember that yearlooking at your data that's

been given to you over thelast 3 to 12 months. we see it going forward.>> that's true. also taking some of ourpropredictions with local economy.we see again, not great growth, about you we see stillpretty substantial growth in local economy.over the next 2 to 3 years. that's going to drive up localincome. i think we'll see local demandthat will keep the median home price relatively high.i don't think we're going to

see big declines or bigincreases. at the upper end, that's adifferent market. upper end, we deal much morewith exchange rate changes. >> what's going on in thechinese stock market. in california, too, we findthat all of a sudden, people decide they want to take socksome of their stock market wealth and park it in realestate. happened in 1999, 2000, afterthe stock market crash in the united states.>> you asked about how do we

see it.and what's going on. you think what's happeningright now is there is some nervousness in the unitedstates economy and the world economy and it could be basethe on this election. this could be, and whattriggers a recession can be anything.natural disaster. it could be political.it could be currency war. it could be some type of ascare. so i think that, yes, we aregrowing and we're kind of

stalling, slowing down a bit.because people are just waiting to see what going tohappen, who is going to be in office.>> holding their breath a little bit.>> yes. and also being morepractical. but again, going back to whateveryone said, if you have the money, if you have the abilityto mortgage, if you feel comfortable in your monthlypayment, then buy. because you will never, thereis no -- you cannot time a

market. no one knows when totime a market. we're not geniuses on thatlevel. we hope we are but we have tolook at it for me, for you, whatever you want to do, if itworks for me, then i'm going to buy.>>daryl: let me ask. we have a number of callerswho have asked about affordability.what is affordable. what is correlation betweenthe high cost of housing and homelessness.rent control.

a number of questions.and then what about the t.o.d. transit-oriented developmentalong rail. and we are on the verge ofgovernment looking at some of housing policies and tryingto generate a lot more affordable units into themarket. if you did that, in a reallyrapid way, can that destabilize our market? arewe in any danger of that? >> first of all, i think weneed to build more. i mean, there's lots ofcontroversies about to we

want to have new green fielddevelopment. big controversy.build up the middle, building on ag land.building on land that hasn't previously been developed.that's where the big controversies are in hawai'i.it's much less controversial to have development,redevelopment on already developed parcels.if the housing crisis is going to be ameliorated, notsolved, but ameliorated for people in middle an low incomeit's, we're going to have to

build more in those areas.think transit-oriented development is one placewhere the state, in particular, the state to takea look at its plans and to think about how can can we getthese lands in the hands of developers who are going tobuild. workforce housing. at thesame time, not windfall profits out of the whole deal.>> i'm concerned about building it and they willcome. that mantra that everybodytalks it to me about.

i'm really concerned about weneed to build, we need to build, we need to build.i want to see infrastructure. i want to see, we're going to,right now, the city is renovating their sewersystem. but they've state the they'renot increasing the capacity. you want to build 12,000 morehomes. where you are you going to putthe poop? sewer line, storm train drains are the only, inthe state, only one in the united states where when therains heavy will, storm

drains go into our sewer andbacks up and then we have raw sewage everywhere on thebeaches for 2 or 3 days. and that affects us, as peoplein our where we want to live, and it affects tourism.you've got to build infrastructure if you want tobuild houses and i don't see that happening.>>daryl: governor's housing proposals, legislature,there was money for infrastructure.there was money for affordable housing.and there is this opportunity

around rail stations thatthey're talking about. assuming that they can takecare of all the poop. scott higashi, what impact doyou think a large amount of inventory over the next, 6, 7,8, 9, ten years, would have on the real estate market inhawaii affordable and middle income housing. i don'tthink it has a negative effect at all.we're tracking the amount much interest in some of thekakaako developments that have not been built that aregoing to be either workforce

or housing that's actuallyhave being administered and overseen by the stateagencies including the hcda and hhfdc, there is a verystrong indication that these demands far outstripswhatever inventory is currently planned and i justdon't think that in the affordable, more affordablecategory, whether by the way, even though we're in realestate and looking for people to buy homes, there is room ont.o.d., whatever, to actually build affordable rentals too.so a lot of housing option i

think that exists. and thatcan be a good transition for people.not everyone will buy a home. but if we can provide betterrental opportunities, better near rail stations, thatcould be very beneficial. i don't think either of thosethings will have a downward effect on the market.the question becomes, and i think sumner and you know, ifyou look at higher price condominium, higher pricehome, i just doesn't know that they absorption is there forthat.

and i think that is a danger.>>daryl: couple of callers now.moving now to the what some makes just building housingexpensive in hawaii. we haven't really exploredthat yet. caller's neighbor build housedoes not make much profit. high costs are driven up byrealtors. >> be careful.it's not us. it's the mortgage brokers.>>daryl: okay. i mean, we talk and thegovernment talkeds about

getting involve in thehousing business in a much bigger way.but really, the way we do our regulatory structure, are wecapable of building things that people can affordquickly? let me throw that one at you.>> i don't think we niecely have to have it that if youwant to do a housing development, that it takesten years to get through the regulatory process.i think this is the time of thing that the state and thecity ought to be looking at to

try to figure out how tostreamline the process. >> work together? worktogether? >> hold on.>> regulatory process still needs some reform.still very complicated. we have a double veto process.if you're trying to build on say land that's currentlyzoned ago land, you have to get it reclassified by thestate and project has to be approved by the city.and if honolulu doesn't approve it, there's no otherplace to go to.

on the mainland, if suburb ofnew york doesn't approve it, you go to the next subshall.go to the next. if you have projects that youthink are useful for people in the new york area, there'shundreds of jurisdictions you can build in.here there's just one jurisdiction and the stategovernment holds second level of approval on thosedevelopments. big deal.we need to be thinking more about how to streamline thatprocess.

>>daryl: really fun request ithink. i want to get this in.fun question. fan chose it.not representative of local residents.you guys are all local residents.no one is deend going gentrification.of local people. i think it meansgentrification. are we head for a fundamentalchange in the way honolulu looks.get use the to the idea that

old rustic neighborhoods aregoing to get drastically thinged.>> absolutely. people a lot of local peopleare having a difficult time affording what they have.and it's going to come to a point that people will have tosell and leave. because my own niece, my ownniece, left a year ago. she couldn't afford to livehere. even though i was a willing tohelp her, and her in-laws were willing to help her, theamount of costs to live here,

and the to get a bigger house,was just too much money w so it's going to get to thatpoint that some people who cannot compete with yourpeople, it goes back to jobs. and what type of education andwhat type of quality of jobs and how much money, you can't,your days of living on the beach and getting fish, whereall the fish are fished out, because there's too manyfishermen and we need to balance, there's no balance.and so people are going to leave.it is going to change.

things are going to change.and you have to get ready for it.>>daryl: with that question, l goes back to our regulationquestion. people say, don't change.what we have. scott higashi, do you see inyour sellers for example, maybe buyers, looking forneighborhoods that aren't going to exist?>> i don't know if they're looking for neighborhoodsthat aren't going to exist. homes grow old and we have alot of neighborhoods that

were developed 50, 60 yearsago. in the insurance market, youthey, to pay for hurricane insurance, on a single wallhome, versus a new modernized homes, substantial costdifference. so in some case, homeownerswell, actually, i've got a repair the home anywhere.maybe i should build a new one.and even though that sounds critical, there are otherfactors. it's not just a housing cost.cost of insurance the and

insurablability and homesstart to fall apart. so there's a lot of homeswhere generation of folks that lived in, new buyers comein and say, gosh, i really want to change this.i want to renovate. i want to make it better.and people will do that. i think we forgotten thatpeople did that. at one point.>>daryl: that's free enterprise.>> it is. >> an example is kahala.in the fifties, pig farms.

and then they came in and theyhad built all of the of the backfill and other developerscame in. they built these single wallconstruction homes. they sold for $18,000.in 1959. now, then those homes sold fora million. then they tore them all down.building mcmansions. and coming in.whole new different place. i went it kahala elementaryschool as a kid. i don't recognize any of theneighborhoods.

>>daryl: this is aninteresting question. i think that we've sort ofanswered it. let's state it straight out.what does the panel think about legislators making itillegal for nonamericans to buy property in hawai'i so wehave more of a chance. second question is, seemslike we're accommodating outside interests, are wetrying to make it easy buck or truly helping families localfamilies. let me ask you.is that fact outside money

really affecting the middleclass buyer? >> we've had outside moneyhere for a long time. i mean, we've had u.s.mainland money here since the 1950s and 1960s.in particular, since the jet plane came in 1958.that money been here. japanese money followed.good history all monies that have come through here.one thing is critical even if we're not going to do greenfield development, not going to develop much on the northshore.

center of the island, we doneed to come up with more dense development in theurban corridor. otherwise, we're going tofind that exactly the scenario.you put forth. people are going to say, ican't really live here. i have to leave.i think if we do some of that additional densedevelopment, we're going to find that we're going to findthat more people are going to be able to afford.person lived here most of my

life now.you're on a island. eventually, we're going torun out of place for people to live.what happens? >> we're going to sink.>> sounds like i agree with you.we don't have enough developable land.supply and demand. legislature going to outlawnondomestic buyers. better spend time, where canwe find transit-oriented development, expand ourdevelopment opportunities

and the entitlement process.>> useful to think about a city like denver compared tohonolulu. economy prospers.you get more inner city development but the suburbanrings start to example expand.move out into the some of the farm land.rural areas. think you're going to havemore redevelopment. all the roads are is going tobe a park lot. there's no infrastructure gotthe last word.

mahalo for all you guy forbeing with us. next week we'll examinestate's shortage of medical doctors.900 doctors short. shortfall expected to grow to1500 physicians in the next five years.it's accepts severe on neighbor islands where manypatients go without care or fly to oahu for treatment.what it take to attract and maintain primary doctors andspecialists on the neighbor islands.next time on insights on pbs

hawaii.i'm daryl huff. a hui ho.

rent apartment valencia

>>farzad: hi everybody we're going to getstarted. thanks so much for coming out.>>will abramson: we should have brought note cards>>farzad: my name's farzad. i'm with the tastemakers team.this is kavon, and – >>kavon: tastemakers team as well.>>farzad: yeah, let's just jump right into it.you guys all know why you're here. in three years the san francisco-based yourstruly has become one of the hottest music video brands on the web.their mission, to discover and document, celebrate and interrogate, capture and catapult thoseartists who without question demand our affection.

in three short years they've produced nearly300 videos. built a number of high-profile partnerships.and in the process have worked with some of the hottest artists in indie music today.just a few right here. ara music, best coast, camera obscura, damfunk, emma, freddy gibbs, grimes, holly miranda, in love, john vanderslice, kurt vile, localnatives, morning benders, night jewel, odd future, pure x, real estate, shabazz palaces,twin sister, unknown mortal orchestra, vetiver, washed out, yellow wolf and zola jesus.so that just leaves off quincy jones, and the xx and you got the entire alphabet there.>>will: they're in collaboration together. [laughter]kavon: so today we are honored to be in conversation

with will abramson.we'll discuss his background. what makes yours truly, truly theirs.how they've grown. the obstacles they've faced. what they're cooking up and what's in storefor the future. plus a little later we'll be hanging out withchris chu who you just saw in that video. of the morning benders, now pop etc. whichyou'll also learn about later. the hangout will be live from brooklyn.we do ask that you stay until the end of the video. we're gonna have two camcorders backthere and we don't want your head popping up. we tried to make… we're gonna make thispart of the tastemakers series. so many of you were here for our first talkfor steven allen.

this is the morning benders and yours truly.and then we'll also be doing 'one on one design' with yves behar.so without further ado please welcome to google will abramson.[applause] >>farzad: alright, well we thought a fittingintroduction for anyone who hasn't seen your videos is a quick reel. this is from the series'in my room' that you guys do with mtv. let's check it out.>> man: it's not for an event really. it's not for money.it's not for like, there's no proper show. it's just; you're just playing your songsagain. [guitar music]it's stripped down.

there's just a group of people sitting aroundyou and you're playing your songs. [guitar music gets louder]>>male singer: [singing] put your dreams away for now.i won't see you for some time. i am lost in my mind.i get lost in my mind. mama once told me.you're already home when you feel love. >>multiple singers: [singing] whoo hooo hooohooo whoo hoooooooooowhoo hoo hoo hoo >>man: those are always the shows that youremember the most. you know, because you get like a genuine audiencereaction.

like you can play on a huge stage and youcan you know have great sound and every ones into it.but then you walk backstage and you never see those people.you don't get any like – >>woman: i think it's also more fun –>>man: feedback. >>woman: because you just don't you're notafraid. [guitar riff]>>woman: and so i'm just gonna go for it and i'm not nervous at all [giggles]>>man: yeah. [single guitar playing]>>multiple singers: [singing] i left first. >>female singer: [singing] because i knewthat this was cursed.

no i never want to see you again.left you hopeless high and dry yeah >>multiple singers: [singing] i moved on.>>female singer: [singing] because i thought that i was strong.i was thinking about myself. >>male: not having it amplified kind of feelslike less official. so you can just kind i have fun—>>female: yeah, totally. >>male: you know.like if it's not amplified all of the sudden, like everything that happens is just—>>female singer: [singing in the background] happening right now.[guitar with background singing] which makes like playing the songs.you know like every time can be its own different

thing.you know it doesn't have to be played the way that it supposedly played which is cool.>>kavon: all right will, where were you born and raised and what did creativity meet yougrowing up? >>will: i was born in new hampshire but igrew up in cupertino. i come from a very musical stock.both my grandmothers, one of which is sitting right here played piano, my grandma playedrecorder. my dad would sing beach boys songs for mein the bathtub when i was a baby. and on weekends my mom was cleaning the house,she would play frank sinatra and george gershwin songs throughout the family stereo, pausingonly to make sure that i would slow dance

with her at least once a weekend.when i was in fourth grade, i saw my very first show at the shrine amphitheater.it was my dad's and i favorite band at the time our r.e.m.and in sixth grade i proclaimed to my parents that oasis was the second coming of the beatles.[laughter] >>will: by seventh grade i realized that theyweren't the second coming of anything. [laughter]>>will: it was then that on family trips to san francisco my parents would drop me offat amoeba with the brownbag lunch so i could spend the whole day looking for records.senior year of high school, the same year that i, my friends and i won a battle of thebands for this rap group we were in called

all about backflips.[laughter] >>will: my future co-founder and best friendand i bob started a music magazine called 'paper airplane'.and it was also that same year that i realized that you could actually study music industryin school. and i think, i realized that i wanted to bein the music business when i was grounded on halloween, my dad took me to see the moviealmost famous. and there's that really nerdy guy who hangsout with rock stars and it was sort of then that i realized that he wasn't nerdy at all,he was the coolest dude i'd ever seen. [laughter]>>will: and that's what i wanted to do.

so creativity for me as a kid was really justabout pursuing whatever felt right. like i was always journaling a lotand when i discovered hip-hop i immediately just started writing in the style that i waslistening to. i was never really musically inclined.like i can read music and play piano but i really just always approached music as a collector.you know i think it's just something that has always spoken to me.and it was there from when i was a kid and i can't imagine my life without it really.>>farzad: so wait. two things in there.one, as in the preparation for this interview you didn't tell me about that hip-hop group.[laughter]

>>farzad: 'cause you knew i would've foundthat. uh—>>will: it's pretty embarrassing. >>farzad: but secondly, you mentioned pursuinga career in music. you found out about school and so, yeah, soat what point did you make the decision to go down to usc and then—>>will: yeah so— >>farzad: pursue the whole music thing?>>will: when i was in high school, when i graduated i went to chico state which hada really great music industry program. but there were aspects of that program thati like. for example they had their own record label.they had a great college radio station.

but it wasn't in one of the hubs for the musicindustry which is new york and la. so i applied to the music industry program.the bachelor of science in music industry and got in.and so i moved to la. in the first summer i got there before i wentto school i was interning at universal. and so i interned from one o'clock until 7pm in the afternoon. and before that to pay for my apartment iwas working at coffee bean from five in the morning until noon.so i had that whole summer to sort of like get ready for this transition i was makingto go to usc. and usc was really, i kind of cut my teethjust doing internships.

and i became the hip-hop music director atour radio station. it was there that i first interviewed an artistfor the first time. i had mers come on my show.and i also interviewed atmosphere who in high school was like my favorite rapper.and i'll never forget the feeling of just being in the presence of someone that youhave such respect for and reverence for. and that nervous feeling you get, much thesame way as sitting out in front of an audience of people that you don't know.[laughter] >>will: but that same feeling that i had thenhas transferred over to every single interview i've ever done.and that feeling that i get when meeting someone

that you really love and have invested youremotions into is still so exciting to me. and i just kept chasing that throughout collegeand then in my professional life when i graduated. actually before i graduated i got an internshipat yahoo music. and then when i graduated i became a full-timeemployee there. and founded the indie music department there.and just tried to figure out how to fit interviewing artists and being around artists into prettymuch every aspect of my job. wherever i could.cuz i just thought, i wanted to develop that skill but i also just found it so excitingand rewarding to. >>farzad: let's talk about one of the firstendeavors you did.

when you were working at imeem –>>will: yeah. >>farzad: at yahoo i suppose.and that wasn't interview series called "keys to the city".tell us a little bit about that. >> will: sure yeah so imeem was a streamingmusic service. and i got there pretty early on when theywere still figuring out the strategy, their content strategy.and i have a lot of leeway to come up with programs and launch programs that i thoughtwould help market the brand in different ways. and so one of the sites main constituencieswhose hip-hop. so i started a documentary series called "keysto the city" where i would go to all these

various locales to document the local hip-hopscenes and have rappers take me around their hometowns.the first one we did was in philly. it was the roots and diplo who participatedin that one. and then, we went to seattle to do a documentaryseries about all the seattle mc's who really, it's like a really strong scene up there butthey haven't been able to launch any national stars.but when you go there it's like this big fraternity. and the "keys to the city" series was reallyeye-opening because we were traveling on our own dimes to do this.it didn't have any support from imeem. it was just stuff that myself and bob woulddo.

my partner bob would do on the weekends.and so we flew ourselves to la. we flew ourselves to seattle and all overthe place to do this series cuz we thought that these stories needed to be told.and this is my first experience with video production at all.i mean we rent, we borrowed bob's cousin's kind of like crappy camera to go do this stuff.and we just went and tried it. and i think a lot of the skills that i acquiredfrom being an interviewer and being a producer came from this trial and error that we weregetting in this "keys to the city" series. we ended up getting some great acts.like we interviewed the game and compton around la.and nate went up to canada to do a piece on

kardinal offishall who's a really big canadianrapper. they took him around toronto for a coupleof days and he came back with some great stuff from there.and it was also at imeem that i met both nate and caleb who round out our founding crewat yours truly. nate was actually if you go to the next slide.nate was producing and shooting take away shows which are basically kind of the grandfathersof performance videos online and— farzad: so the difference isn't on "keys tothe city" was just interview strictly? >>will: it was interviews and just kind ofmore in-depth documentary. so like, the funny thing is that not a lotof that content is online.

because it was all uploaded to imeem whichno longer exists. so you can't really go back and watch a lotof the "keys to the city" stuff. but we did stuff on raphael saadiq in oakland.a bunch of great videos that i think are hopefully on a hard drive somewhere.but they're definitely not online. >>farzad: this is, 'the take away show', startedabout 2006. and that's from the blog called la blogotheque.i'm sure you guys are familiar with them. they sort of had a network of bloggers andyou and nate i guess both were. >>will: yeah so nate.i didn't know nate, but he was shooting take away shows.and he connected with the mission of the take

away shows and reached out to the founderchryde. and he was the san francisco arm of the takeaway shows. and i found chryde separately just from beinga huge music fan. and when chryde came to san francisco fornoise pop in 2007, he introduced me to nate. he's like, you know one of the dudes fromthe take away show lives here. and so immediately upon meeting nate, he andi started working on stuff together. we started producing videos that ended upon imeem. and producing take away shows like this leakylee take away show we shot on a beautiful blustery san francisco day.and it was also at that time that i met caleb,

one of those like music industry schmoozefest kind of things. and caleb and i actually connected over ourmutual admiration for the walkman, the band the walkman.and we actually just had the chance to shoot the walkman after years of kind of like waitingand hoping that we would get a chance to work with them.>>farzad: just on this past tour when they were here.>>will: yeah, yeah. just on this past tour.they came for the 10 year anniversary show. so they came by studio different fur whichis on 19th and valencia. it's actually where we shot the very firstgeorge truly video with waves.

and i think when he was doing the video, hethought that he was shooting a take away show. and, surprise.this is a yours truly video. [laughter]>>kavon: so, i mean i feel like we've already gotten uses of the story.but kind of like what was missing in the music industry?or what was missing in your view that kind of you know birthed yours truly?i mean i feel like we've heard a little bit of adhesive, but put it together for us.>>will: yeah, i think you know we took a hard look at the music landscape of the time.we saw these different verticals. there is a sales and subscription, there'snews and criticism, there's music discovery

which the thousands of music blogs that weread every day and there's music is lifestyle. and one of our biggest challenges was figuringout how could we differentiate ourselves in this already overcrowded space.what can we do to compel users to come to yours truly instead of any of these othermusic brands that they trusted every day. and so in figuring out that value proposition,one of the things that is just as important to figuring out who you are is to figure outwhat you're not. and so we knew that you know if you wanteda record review you go to pitchfork. if you wanted to watch music video, you goto youtube. if you wanted to listen to an mp3, you goto hypemachine.

but if you wanted to learn more about an artistbeyond their mp3 or watching their music video. if you wanted to get to know them as people,or to watch them create their craft you know firsthand like you were sitting right there.there really wasn't much out there for you. and so instead of you know trying to competewith all these brands up here, we decided that if we were going to win we had to inventour own game. and so we use what skills we had which wastalented filmmakers, passionate journalists and we created a format to put the artiststhat we loved in the best light possible. and so what the take away shows we were doing,was they were putting artists into their format which was the take away show which to me isstill the most revolutionary format out there.

but we decided that we wanted to adapt perartist and give them whatever situation fit them best.and from a brand perspective, it was really just about focusing on what we thought wecould do really well and iterating on that process and innovating within those confines.and so it's really just kind of a choice between do you want to be mcdonald's or do you wantto be in and out burger? mcdonald's has something for everyone.you know they got chicken nuggets, and those suck and the big macs suck too.but when you go to in and out burger and you know that there's three things on the menuand everything is good. you know exactly what you're getting and youget it every single time.

>>kavon: nice, alright so –>>farzad: so, you're not inspired – >>farzad and kavon: by mcdonald's.>>will: i'm not inspired by mcdonald's. >>farzad: that's a good segue.>>will: although apparently when i was a baby my nickname was william "the refrigerator"perry. they called me "the fridge", and apparentlyi could put down like three cheeseburgers as a two-year-old.[laughter] >>kavon: so i think that people love, i meani definitely do and maybe i'm just gonna latch on to like making this a question.like what are you inspired by? i mean i feel like i watch some your videosand i have such a distinct yours truly take

on this.like you've almost created your own genre or your own way of approaching music.what do you guys look for in inspiration right? what inspires you guys or you know sent youon this path. >>will: sure, i think you know there are fourof us that do yours truly and each of us have different points of inspiration.and it's a combination of those four people who come from very different backgrounds withvery different sets of tastes that make yours truly what it is.but we also agreed on a few things about the brand.you know, we agreed on a few things we wanted the brand to stand for.but in terms of inspiration, i get it from

a couple of things.wax poetics magazine is one of my all-time favorite magazines.it's incredibly well done, well researched. it's basically about soul music and latinmusic and african-american culture throughout the years.their photo of the guy with the pink sunglasses is taken by jason nocito who's the principalphotographer at the fader magazine. the bicycle is by william eggleston who'slargely considered to be the father of color photography.aaron rose is kind of your renaissance man. he the curator of 'the beautiful losers'.and just he really straddles the line between commercial and fine art.there's also geoff mcfetridge on there which,

his hand has touched so many major brands.pepsi, nike, new york times you name it. jay-z is kind of the king of the brand extensionin my opinion. you know jay-z may not sell the most records,but he's by far the most well respected artist. and he's been able to take the equity in hisbrand and apply it to so many different areas which is truly amazing i think.so, and then, the black-and-white image you see is a film by bruce weber on the saxophoneplayer chad baker. and that film you know shot on 16mm black-and-whiteis just such an amazing portrait of that artist. it's completely unflinching and a brave portraitof him. and ultimately what we wanted to do was setout to tell stories.

and what the thing in common that all of thesethings have is that these are all brands that do a great job of presenting stories in themost honest and direct way possible. at the very base of it, you know these areinspiration points. these are influences of ours.but at the end of the day it's really the music.i mean there is no better feeling than finding a new artist.like i get no bigger rush that when caleb sends me a band that i've never heard of.or when i find a band on the blog or on myspace or band camp that i've never heard of.and it's like you start listening and it's really good in then you're like "oh god pleasestay good, please stay good."

and then it keeps being good and then—[laughter] >>will: and then the songs over and you'relike, "oh my god, if this band has one more good song it's over."[laughter] >>will: so like it's really just the music.and there is so much that, there is no shortage of inspiration out there.you know every day, or at least every week i try to make sure to find one band that blowsme away. >>kavon: thank you internet.>>will: yeah, thank you internet. >>farzad: so discovery is a big part of yourstruly. but also can you tell us about sort of thevisual and philosophical concepts behind the

brand.in particular the logo. >>will: sure.>>kavon: which is absolutely beautiful by the way.it's – >>will: yeah>>kavon: it's very distinctive. >>will: yeah, we spent about six months everyweekend and most weekend nights at bob's house trying to figure out how to present this logo.and bob who's the designer of this logo is our creative director and he's a graphic designerby trade. and so a lot of our graphical influences comefrom his vision. and basically what we decided on was we wantedto think about what yours truly really was

at its core.and ultimately what we're doing is we're shadowing artists.we're following them around. we're capturing their stories, but ultimatelywe're watching them. we're standing behind them.we're shadowing them. and so, this idea of t shadowing the y comesfrom that philosophy that we are there to you know discover and document, capture andcatapult and ultimately shadow these artists that we admire.and deserve to be covered by us. >>farzad: when you started to get this thingoff the ground, before anybody really knows who you are.i mean how do you actually gain access to

artists?>>will: we booked it through a publicist that i knew named daniel gill who represents alot of great bands. and waves was in san francisco.this was really you know right before he started to get some, started to get some traction.i think a lot of it has to do with getting onto bands early.you know getting involved in their careers early on before they blow up.and there's a lot of evidence of that with yours truly.and it's like artists before they get big are just more flexible, easier to work with,have more time. but one of the biggest things was the factthat we were in san francisco.

so, you know bands have a lot to do in la.they have a lot to do in new york. but often times they are just hanging outin san francisco because there's really no, there really was no media outlet.like yours truly in san francisco. so we were able to get access to bands basedon my relationships and caleb's relationships with label people, with publicist.with managers and with bands. but ultimately it was just the quality ofthe work we were able to show them early on. you know we shot that first waves video andthe band loved it. i was able to get it on gorilla versus bearand fader and stereo gum and pitchfork right from the outset.so right away we were building a case study

for what yours truly could be and what thebenefits for you a band would be for doing yours truly.and i think this slide is actually meant to talk about the brand of yours truly.and i kind of want to do that for a sec if i can.so everything about yours truly begins and ends with the name."yours truly". which is a way to sign a letter.and a lot of our core values come from this act of letter writing.so "yours truly" stands for careful curation. because you're not just gonna write a letterto anyone. if you're gonna put the time and effort intowriting some a letter you have to make sure

that that person is going to reciprocate orthey're really worth the time and effort you're willing to put in.so we think about that every time we choose bands."yours truly" stands for high quality but handcrafted.if you're gonna write a letter, then you're gonna do your best to you know give your bestpenmanship. even though mine is always terrible.[laughter] but you're gonna do your best to make it lookgood. but at the same time, like if you mess upor something that's just part of the fact that there's a human writing it.and so we want people to see that yours truly

is made by real people who really care aboutwhat they are doing. and lastly, when you write a letter you wantto be proud to sign the letter and then give that letter to someone.this is yours. truly.and so we think about that every time we make a video.you know this is kind of a little gift for the bands.it gives them another reason to go out and get people to fall in love with them.it's a gift to fans, to get to see another side of an artist that they didn't get tosee. or to discover an artist they never knew existed.or to hear an artist speak for the first time.

and for us, the gift is that we get to spendthis time with these musicians that we a lot of times have crushes on or love and adoreor just are really passionate about. >>farzad: i think the next thing we want totalk about is sort of what is your model for marketing and distribution?on the web. >>kavon: i mean you guys don't have ads onyour website. >>will: yeah.>>kavon: you don't have mass marketing campaigns. you know, i mean, everyone here works at google,so we know that revenue, you don't need revenue right away.but kinda like what is your plan. >>will: yeah.so i sort of equate the yours truly business

model to two cross-sections of a house.the outside of the house is the beautiful facade, the architecture, the big open windows,the fresh coat of paint. and that's the yours truly brand.that's what we've been really developing this whole time.so whether you see it on our website on our facebook our twitter our tumbler or you watchit on our channel on pitchfork tv or you see yours truly videos on any of the blogs thatwe push out to. or our partnership with mtv.this the strength in the brand that's been able to get us these integrated partnershipswith brands like mtv, pitchfork, odyssey which is a local speaker company.we've also done stuff with levis and urban

outfitters.and so it's this strength in the brand that's been able to give us these opportunities tomake partnerships where our brand and their brand are getting married for short periodof time to do these series. and that feeds the other side of the housewhich is yours truly's services. where we offer production services to brands,to media companies like pandora or mtv or beer brands or companies like levis, likechevy, w hotels, braun, aces. any number of these companies that see thework that yours truly does in its public facing side.and, you know, attached themselves to that work and then realized that we would be agreat fit for a series that they're producing

for their own purposes.so it's sort of this hybrid model of we are a public facing brand and an editorial brand.but we're also a production company offering production services.and it's a cool reciprocation because you know just last week someone from an agencyreached out and they said you know, "i really like the way yours truly videos look i wantto do a series on several artists for a beer brand that i'm working on."and so in that case, we offer our producers and directors to go execute whatever campaignsthat they're trying to do. and that's a good way for us to make moneyso that we can continue to do all the free editorial stuff that we really want to do.>>kavon: yeah.

and so tell us about how the web has likeplayed into that right? i mean you guys are a blog, or started asa blog right? and so—>>will: yeah. >>kavon: what is the web allow you to do?and like kind of compare yourself to maybe even a traditional record company right?what are you guys using? how are you using technology to replace certainaspects of it? >>will: yeah, i mean, i think one of the decisionswere made early on. and this has a lot to do with the fact thatwe decided not have advertising was that if you want to sell advertising, you have todrive traffic to your site.

but what we wanted to do was to create a pushmodel where instead we would focus on the content and getting the content out to asmany places as possible. rather than trying to suck people back toour site. so as soon as we release a video, we're encouragingall the blogs who are fans of this band to post our video and to link back to our site.so that's to help drive home the brand equity. but also to just expand the reach of our contentitself. because we've always been about the content.the content creation process. so, we always have had this push model wherewe are leveraging all the assets that are created in the process.so there's the video, there's the audio of

the session that will upload to soundcloudthat will route through our facebook or our twitterand in an effort to get more likes, or get people to re-tweet.we do contests for tickets and giveaways and stuff like that.and basically it's just about leveraging the assets that are created while were shootingthe band. so while were shooting bands, we're takinginstagram photos and posting those posting that to facebook.and really it's kind of a different way than a lot of bands approach.sorry not bands, a lot of websites approach building a brand.but for us it's worked.

it's gotten us to be featured and in conversationson all these sites that are outside of our network.and to get people to you know, maybe if they see it the first time they'll just watchedthe video. but maybe if they keep seeing content on theseother sites that they already go to and they keep seeing this link to yours truly, they'llend up coming back and realizing that we have this huge catalog of bands that we've beenshooting. pieces that we've collected over the years.that's kind of how we've done it. >>kavon: you guys have done a great job.>>will: thanks bud. >>kavon: love that graphic back there.>>farzad: so before we get into more of how

you guys are using the web and actually southby southwest where on one and the musicians and then the interactive side sort of cametogether, met in the middle and you guys were actually out there together for a day or two.>>will: yeah. >>farzad: we want to watch something brand-newfrom you guys. this is actually, i think it's sort of premieredon youtube music. >>will: yeah>>farzad: that's where i first saw it. jacob mcpherson from the youtube team threwthis up on the web a couple days ago where you guys were featured on the music page.so let's check it out. this is a really cool video.>>lee fields: oh, man i feel good today.

had to get that out, you know.you got a laugh inside you sometimes. a lot of people don't know.but my, i live by the rules of if you keep a laugh on the inside it'll hurt you later.so if you got a laugh, laugh i don't, let it go.don't hold it down. i believe laughter is a good remedy.i'm not a doctor; don't claim to be a doctor. i'll let the doctors be doctors and lawyersbe lawyers, politicians be the politicians. i'm a singer, that's what i do.[guitar music] >>lee fields: [singing, blues style]i've always been a faithful man. til you came along.i've always been a grateful man.

i've always been a faithful man.[saxaphone joins in with guitar music] >>lee fields: don't make me do wrong.baby. don't make me do wrong.i've always been a faithful man til you – [just saxophone music]>>lee fields: came along. [just guitar music]>>lee fields: i was just hanging out. trying to clear my mind.i saw you eyeing me. it was plain to see.said i was a married man. said you were 23.don't make me do wrong. baby.don't make me do wrong.

[saxophone joins guitar music]>>lee fields: nooooooooo! don't you know.[just guitar music] >>lee fields: i've always been a gratefulman. til you came along.i've always been a faithful man. i've always been a grateful man.[saxophone joins guitar music] [just saxophone music]>>lee fields: came along. [just guitar music]>>lee fields: we were just hanging out. didn't mean a thing.but when i start walking out, something came over me.never felt so guilty.

[saxophone joins guitar]>>lee fields: never felt so good. don't make me do wrong.baby. don't make me do wrong.noooooooooo! >>lee fields: i've always been a faithfulman. i've always been a faithful man.[saxophone joins guitar] [just saxophone music]came along. [saxophone and guitar music]>>lee fields: yeeeaaahhhhh!! i've always been a faithful man til you camealong. always been a grateful man.i've always been a faithful man.

don't make me do wrong.don't make me do wrong. i've always been a faithful man til you –[just saxophone music] >>lee fields: came along.>>farzad: very cool [applause]>>will: i had just made him breakfast in our kitchen right before he did that.and we had chickens in the backyard of the house.and so, he was, he wouldn't shut up about the fact that we had fresh eggs."i haven't had fresh eggs since 1973 and they don't taste the same."[laughter] >>will: but when he did that scream, thatlike animals scream, i swear the house was

like reverberating. it was insane.it was really fun >>farzad: so that was something you guys filmedin austin? >>will: yeah, yeah.so we were up out there from monday to monday this year.so one of our official showcases which the white poster right there.that was during interactive, so it was the last night of interactive.and caleb produces all of our events. so he put together this event and then anotherevent in partnership with gorilla versus bear. that's the poster on the right.so that was at the hype machine hotel. they have different bloggers curate differentshows.

and so we did those two official showcasesand then the poster with the state of texas on it is a poster for our 'in my room' series.which is in partnership with mtv. and then there's just some stills there.>>kavon: you guys were really busy. >>will: we were very busy yeah.it was a lot of fun, but we shot 10 different bands and we had those shows.it took a lot of, bunch of meetings. and just catch up with people in the musicbusiness that you only know over e-mail over the phone.it's like so that what you look like in person. so there was a lot of that that goes on to.but it was tons of fun. and that was the first piece that we releasedfrom our south by southwest section.

that lee fields video.>>kavon: so your label, 'love letters inc.' >>will: mmm hmm.>>kavon: you know it really kind of, you guys are in on.in business terms you're like vertically integrated right.kind of going end to end. can you give us kind of a sense of your planis in that sense. i mean are you guys, like gonna be the firstpeople to go from a blog to a full blown record label.>>will: we wouldn't be the first no. there's plenty of—>>kavon: yeah, there's a lot of people. >>will: there's plenty of examples of thatactually.

one of the best examples is a blog out ofthe uk called transparent blog. and they released the first washed out singleand a bunch of other ones. and now one of the guys has an imprint on,domino records. but our idea with love letter inc. was reallyjust to; it's kind of a brand extension of yours truly.it's really based on our love for physical objects.just like letters. we love to be able to hold something.so we wanted to be able to give our fans something that they could hold.something that we could design. something that we could be involved in fromstart to finish.

so when bands are coming through san franciscoto do yours truly sessions. they're playing songs they've written foran album of theirs or an ep of theirs. or something that they've done themselves.but in order to keep innovating, in order to keep you know doing something new withour format we wanted to get involved earlier on in the process.so in the songwriting process. or in the recording process.and we wanted to offer our fans and fans of these bands better insight into what thatprocess was like. what does it take to make a record?so the first record that we ended up doing was this big k.r.i.t record.and big k.r.i.t put out a mix tape that i

listened to and loved and this was beforehe got signed at def jam. and was kind of like a full-fledged rap starnow. but i begged his manager to fly out to sanfrancisco. and i was gonna put them in the studio withthis great local r&b band. so he came to san francisco, crashed on mycouch for a couple of days and we made this ep.and that became the first yours truly release. and the second one 'how to dress well'.the white background with the image in the middle.that was a tribute record of the 'how to dress well'.tom who is managed by caleb.

one of his best friends died.and so what he wanted to do is this ep called 'just once'.where he would do orchestral versions of his songs that we would release on 10 inch vinyl.and make available for sale. and the one thing that's unique but is alsocommon to each of the releases is that they each have a charity element to them.the big k.r.i.t record, 100% of the proceeds go to the, go to charity.the nitro records, and 'how to dress well' record, one dollar of every sale goes to charity.so what we really wanted to do was create these physical objects and be involved inthe record making process. but also, create something that we could useto get back to the communities that deserve

it.>>kavon: you know i keep on hearing the word create with you guys and that's what i loveabout you. it's like you're always you know.you always, you didn't see that there were like these behind the scenes videos.so you went and created them right? and now it's like you want your vinyl recordsright? so you're gonna go and create them.>>will: yeah >>kavon: what else do you guys, you know,what other project you guys got up your sleeves? like what else is going on with the yourstruly. >>will: you know were constantly producingvideos.

and it's these short either short form documentariesto performance pieces to these making of pieces. we're doing epks and you know making of albumpieces. we did a live concert dvd of the documentary.but really what we're looking forward to this year is bringing the yours truly experienceinto the living room. which is something that i know youtube isfocused on too. as well as vimeo.bringing yours truly into the living room. improving the yours truly site.getting yours truly on ipads and iphones. just improving our distribution model to getyou, into as many eyeballs in as many homes as possible.as well as to continue to produce the same

high-quality content that we have been doingall along. but i'll give you kind of a sneak previewof one project that i'm excited about. it's the stagger lee project.so in 1895 in a st. louis saloon this pimp and hustler and notorious character namedstagger lee shot billy lyon in the back of the head for trying to steal his stetson hat.and so this story that happened in the late 1800s as soon as it happened it swept throughthe south and it was played and covered by whorehouse pianist to just pool balladeers.and passed along before recorded music ever occurred.just as sort of a folktale. and every time whoever sang it would reinterpretit and stagger lee gets scarier and scarier.

and he's just this bad villain like character.and then when recorded music came around, the song has since been recorded over 400times by elvis presley, bob dylan, bo diddley. you name it, the black keys.you name it, someone has a version of the song.and so this character of stagger lee, this badass character has been translated intoall these different forms of music except for the one form that i think it really fitsand that's hip-hop. and so what i wanted to do was to update thestagger lee saga for the 21st century. to basically find two artists who could playthe parts of stagger lee and of billy lyon. but before they do that, i wanted them tosteep themselves in the history of blues music.

which is what created this song.so the idea is to send big k.r.i.t. and yellow wolf down to the mississippi delta.to have them take a trip to clarksdale mississippi where bb king was born and robert johnsonwas born. and to basically soak up the roots of bluesmusic and to use that influence to create a new version of the stagger lee song.and we would create a documentary about that journey.a documentary about the making of that song. release that song.do a music video for that song. and basically what the goal is to bridge thegap between this american roots and folk music that it has influenced not only hip-hop butr&b and rock 'n roll.

and try and bridge the gap between what kidsare listening to today and this great tradition of american music that is in danger of extinction.and i just remember reading the story for the first time and just thinking this hasto be told. and then when i finally heard big k.r.i.t'smusic, i realize that he was the guy who could play stagger lee because he's from mississippi.he's a producer. his music is so bluesy and soulful and i thoughtyou're the guy, your stagger lee. so we have this idea, and it's really justsomething were trying to get made at this point.>>farzad: that sounds really awesome. got a little bit of time left.and i think that means that it's time to jump

on our hangout with chris who you might'veheard for a second there. so i'm just going to move the computer upso that he can see us all. or at least see us up here.and yeah, let's try to do this. >>will: is he hanging out?>>farzad: hopefully this works. chris are you here?there he is. >>chris chu: hey you guys.hey how are you? we got farzad.>>kavon: what's up dude, thanks for coming. [laughter]virtual reality. >>chris chu: seeing the side of your face,it looks good.

[laughter]>>farzad: awesome. chris, thanks so much for taking the time to be with us.of course one of the most celebrated videos from yours truly comes from the morning benders'"excuses". i think we all pretty much fell for it thefirst time we saw it. >>kavon: instantaneously.>>farzad: i think it's been well, i'll ask you.what's it been like for the band, what was it like making the video, what was the reactionwhich guys got? >>chris chu: it was great honestly.just thinking back to that day is so special. and i think, we've done a lot of sessionsand music videos and stuff like that.

and almost 95% of the time we do them we haveno idea how it's gonna turn out and it's just, you kind of let it go and we just hope forthe best it. but when we did that session, we just feltlike this is gonna be something special. we knew it from the moment i think that wewere done that day. and then we saw the first captures we wereblown away. >>kavon: awesome.and you know what did it do for you guys as a band?i mean like people see music videos but nothing quite like that.>>chris chu: yeah, yeah. i feel like that was one piece of contentabove anything else that we've ever done that

people knew about us.you know we went on tour all over the world and by far the most common thing people wouldsay was you know i love seeing you guys play that song on the roof.playing that song on yours truly or whatever. >>kavon: yeah>>chris chu: people definitely got the word out about it spread around which is most powerfulthing you can do. >>farzad: that's awesome.well, we do hope that you guys have plans to work with yours truly in the future.but not as a morning benders, it's going to be as pop etc.can you tell us a little bit about the name change and what we can expect from the newgroup if you could call it that?

>>chris chu: yeah.well i wrote kind of a detailed explanation of why we changed the name.which i can go into just briefly i guess. we have time for that?>>farzad: sure. just briefly that's fine totally.>>chris chu: yeah, i mean we named our band morning benders early on like a lot of bandsdo without thinking about it very much. [laughter]>>chris: i mean we thought it was funny or whatever and didn't think much about it.but we found out at some point like about a year and a half or two years down the linethat there's this alternate meaning in the uk and europe that "benders" is kind of likea slang word or the equivalent of fag or gay

as used in america.like kids call somebody "gay" thinking it's funny.and you know were not like super pc guys or felt like, you know.it's not like something we would correct someone on the street and yell at them.but when it comes to our band and what we are associated with it just made sense forus to not be associated with that. because it felt like it was giving off thisfeeling or this expression that isn't in keeping with how we feel and how we lead our lives.it just, it became ignorant. you know kids thought we were making a jokeagainst gays. that's just, that's not a joke we would makeyou know.

so were pop etc. now.and we have a lot of exciting stuff. >>will: and killer tunes.>>farzad: yeah. if you guys haven't heard the new mix tapeyet, you can download it for free on their website popetc.com is that right?.>>chris chu: yeah. >>farzad: and do you think also the new bandname in some ways is a prelude to the new sound?>>chris: yeah, i was telling will the other day that the motivation behind the name changewas well what i just told you. but it definitely aligned itself with thiscreative changes well. we have a whole different set of stuff.and we've always told all our fans that we

want to change, were not creatively satisfiedby staying in the same place. so i know people get their hopes up and theywant to hear big echo 2 again or whatever. [laughter]>>chris: but we just can't. i think there's a lot of bands do do thatover and over again. they make five or six albums that sound generallythe same. which is great for some people, but for usit's not how we want to do it. so yet we have this great mix tape out.and we got a full album coming after that. and hopefully some cool videos and stuff aswell. >>kavon: very exciting.so, do you know, do you guys actually have

a release date for that yet?>>chris chu: we don't have an exact release date.but it'll be sometime over the summer like early summer.it's a very summery album, so we wanted to align with that.>>farzad: ok. and hopefully coming back to play a hometownshow if i could call it that. >>chris chu: oh yeah.>>farzad: sometime soon? >>chris chu: of course.yes it's definitely a hometown show. we still consider ourselves bay area kids.and we talked a lot about how we're gonna and end up back there.so next time hopefully i'll be in the room

with you we all at google can hang out.>>kavon: hey, that would be awesome. >>farzad: you're welcome any time.>>kavon: yep. chris, do you wanna actually.chris do you have like 10 minutes? or do you have like 6 minutes?>>chris chu: yeah. >>kavon: cuz we might open up to questions.and we can have you and will respond to people's thoughts and questions interrogations.>>chris chu: sure. >>kavon: do we have a microphone?>>chris chu: hanging out. >>kavon: alright cool yeah, hangout.[laughter] >>kavon: that was a marketing plug.we paid him to say that.

do we have a microphone or no?that thing work? perfect, does anybody have any questions oryours truly or chris chu. lisa.>>lisa: i was just wondering— >>kavon: you wanna give>>farzad: we'll just repeat the question. >>kavon: ok.>>lisa: how much work, how much time and effort go into drafting each videos?>>will: wow. well there is a sort of like three differentphases of it. there is the booking of the band which isfinding the bands first of all which takes a lot of work.i have google reader of about 300 different

blogs that i read every day.i probably say the same is true for caleb and nate but probably 300 different blogs.there's the finding of the band. then there's the booking of the band whichis a bunch of e-mails back and forth with their publicist or their manager, just figuringout where we're gonna do with how we;re gonna do it.then figuring out how it's gonna get recorded. and then there's the actual day of the shootwhich is usually just a few hours. and then there's the post production processwhich is handled by nate or bob who are editing the video.and that's really the most time intensive process.so if i had to put like an hour on each video

i would say like 16 hours what do you thinknate? 16 to 24 hours maybe.i mean it depends on the content too. like if we're doing a documentary or evena short documentary that's really narrative in nature.then that takes much longer to edit than like a performance piece would.but like i said it's these, it's this whole kind of start to finish process that.it takes a while but it's gratifying. >>farzad: do you find that the quality ofartist that you work with actually helps that process.i mean like when i look at the morning benders video and i see this performance like it lookseffortless.

but i can imagine it was an easy thing toget in a room full of people— >>will: well that's all chris.>>farzad: multiple drummers. >>will: i mean, that was chris's, this islike his. i sort of see it as like your swan song forsan francisco. like a going away present.you like those are all your friends, and i remember we were just hanging out.like i knew you just from being at different fur.and it was sort of like yours truly was just getting started and you guys were enough finishinga new album and you are playing me the mixes. and you were like, "i have this idea thati want to do this piece and invite all these

people."and it was an honor for you to have us do it.and i think that the fact that it came out that way is just, we kind of met in the middleand just got it done that day. and the stars aligned and all that stuff.but yeah i do think it has something to do with the quality of the artists.and like i was saying earlier, we think about people that really kind of deserve the attentionand deserve our effort. because it is a lot of work to put into aband. and so we kind of take this less is more approachwhere we'd rather shoot way less stuff and have it be way better than just be constantlyproducing content just because we have to.

if we had a bigger team than i think you knowwe might be able to do that. but at the same time, we like just you knowmaking each thing we do very special and putting our all into it.>>farzad: awesome. unfortunately, we're actually running outof time. >>will: really, that was it?>>farzad: so i'm gonna have to call today. [laughter]>>farzad: thank you so much everybody for coming out, chris thank you[applause] >>farzad: catch you later man.>>will: later chris, see ya.