oh baby no skin on skin you just got to keep the shirt on listen to me only the best for my daughter this is 100 laura piana vicuna she's got a few content there is nothing they're using to wipe her when she was no this is the sweater that she's got her face on but this is the softest material human you know i mean natural material on earth really this is not subject to any supply chain constraints oh in fact when you buy one from laura piana they'll fly one right to you let your winners ride brain man david sacksource [Music] guys isn't it amazing how people in power cannot take any time off and still remain in power and engaged when you have a baby jkl what's the reference okay our friend joe lonsdale venture capitalist living in austin had a tweet that uh went viral but maybe not for the best reasons he said uh in response to a dan primrack tweet dan works at axios who was talking about joe rogan criticizing uh the amount of time booty jag was taking on paternity leave and joe lonsdale responded wow great for fathers to spend time with their kids and support moms but any man in an important position who takes six months of leave for a newborn is a loser in the old days men had babies and worked harder to provide for their future that's the correct masculine response well it was an opinion from 1957 that's either his or he the way back machine but chose old school joe is a unique individual and he just happened to i think in this whole like not get canceled debate or don't let yourself get canceled debate the right is now saying like i'm just going to tell you how i actually feel and so joe told us actually how he felt i don't think he said anything offensive i think you can have a different opinion than what he said but i don't think he said it shouldn't exist he said if you're in a position of power and you check out for six months it puts everything that you're doing under a lot of pressure that's i think what he said and he called those very specific people losers the context is joe rogan called out pete butterjudge because pete buddha judge had two kids via surrogate and i guess it's taking six months or i don't know i don't even know how much time he's doing he's got three months but nobody knows if he's like working half but rogan but rogan had an issue with it and then dan primack basically said what rogan doesn't know is at his own company ie spotify there's a six-month policy which by the way joe rogan does not work for spotify based licenses show so there is no way for joe rogan to know the internal policies he is not an employee i mean jason if you want if you want to hang your hat on that little fig leaf okay no i'm just saying it's i'm not defending joe but i'm also saying like how would he know it's not like he went to hr and was like hey what's our fraternity he doesn't work there fine well six months is a long time especially i mean that is a long time to take off the word loser is a very strong word do you think men who take paternity are losers no no i mean there are children who take i do think that is a long time for somebody who you know prioritizes work i mean if an entrepreneur took six months of fraternity would you would that influence whether or not you invest in his business well look if you are the principal of a business and you just disappear for six months that's not gonna work i mean let's be realistic unless unless it does in which case then you have other problems well or look if you're at like the stage that google is at or whatever the founders can disappear and move to you know islands and private islands and it doesn't matter what they did but look we all know i mean that when you're a startup you face existential decisions daily weekly or monthly you can't just disappear for six months it's not going to work you might only have six months of runway so if you did take six months of paternity there would be no company when you came back in all likelihood let me speak for myself i couldn't ever take six months i'll i'll probably take three weeks to a month and honestly i agree with david i really didn't do much of anything nat had to do frankly all of this by herself and so i'm there to just be moral support and help where i can you know baby needs a diaper change i do that i'll hand feed in a bottle because she's tired of pumping and you know breastfeeding like but i am so peripherally at the edges trying to help and be relevant and try to give her a break here or there that's my role and at some point when the kid gets on a schedule there's even less stuff necessarily for me to do other than again just be moral and emotional support then of course there's bonding and stuff but you know to be honest with you like i have found as a parent the the connection that i have with my children has gotten meaningfully better as they've gotten older and maybe that's just the limitation that i have and my need to communicate and how i want to connect with my kids and how i feel i get feedback back that gives me energy to be a parent it is much easier for me to find that equation with my 12 year old than it is with my you know two day old so that's just me you know i'm going to be out for three weeks to a month and well the other thing we're leaving out here is the question of resources so joe lonsdale according to his podcast is a billionaire in his podcast title and so if you're a billionaire and you have unlimited resources at home and 24-hour night nurses which you know we all know what those costs uh you're talking about a thousand or two thousand dollars a day uh to have 24-hour coverage but that's nothing to a billionaire so if you i don't make it about class but if you were two working parents and you didn't have the money to hire somebody this is actually practically the only thing you can do somebody has to be with the kid and it can one spouse be at home you know i'm on 24 hours alone with the kid all the time as you guys know i'm from canada in canada we have a one-year maternity and paternity leave policy it can kind of go both ways the the basically the family gets it and you can allocate it as and how you need it and it pays for the salary the the government care basically guarantees your job you go on effectively unemployment insurance after some period of time where you go from 100 of your salary to about i think it's 50 somebody will correct me if i get these details wrong and then you go through the rest of the year now in both cases by my sister you know when she had both kids you know on the way in she was like i think i want to take the full year and by the six month mark she was losing her mind and you know she's a lawyer at a really good research hospital and you know she does work that's really valuable to her and that she finds really stimulating and she just needed more adult connection after six months it was very hard for her to kind of be there yeah i just think six months for the second parent is that seems like a long time i don't think i could take six months off but i also think if you have resources there's pockets of time even when i did stay home for i don't know the first couple of weeks after the kids were born you know they're asleep for three hours and then you clean the diapers feed them they play for an hour or two and then they go back on a nap you know it's like it's constantly the stop and start i mean that's the thing that's hardest about is the lack of sleep i think oh my god it feels like i mean it's funny but like i i forgot what it's like but you know you're reminded quickly it feels like you're drunk yes two hours you wake up you get a 10 minute cat nap you wake up and this is where again i go to and i'm such a big player in this play right now you know at the edges where i'm like not sleeping i can take care of tally but i i don't know how women do it it's it's incredible and for those of you listening has got his newborn on his chest uh and uh swallowed quite nicely there this is why you should subscribe on youtube and you can see you can see that he's using his new daughter to get the youtube subscriptions up this is good they should blow us past 100 000 how do you feel so special i feel so lucky um i feel so so lucky this is going to be the most popular cameo on the pod since freeburgs dog yeah i mean she this chick is so deliciously cute she's so she's so delicious and i forgot how beautiful the sounds that girls makes versus boys having three boys and two girls now i remember the boys they make kind of interesting noises but not really but my gosh like little baby girl noises oh and you guys sax has two girls you have three three big dog girls it's girls are incredible we're all basically girl dads like coco oh so what a blessing what a blessing i feel really like any news on your friend well we had a baby the day after each month at a baby so we're all right i did see the best congratulations thank you freeberg where's your swaddled infant you're letting you're letting chamoth uh win sweeps weeks here what's going on yeah his vacuna is on the way i haven't i haven't been are you in the joel lonsdale you you did one she's in the the place where you drop the kids off to get raised and then you pick them up in a year okay you're like oh you mean like vulcans you're like vulcans where you're vulcan into a learning pod and come back a year later i mean they sleep most of the day so she's asleep right now actually allison just sent me a picture she's sitting on the rocking chair where they're outside right now pretty amazing i give lonzell a lot of courage for saying what he thought i really don't think that uh what he said was altogether that like vilifiable if that's the word you want to use i think that there's a lot of reasonable points of view he could have maybe used better language but i think where he was coming from i think a lot of us probably wouldn't do it ourselves we may never judge anybody else i would never judge anybody who wants to take six months i know that i could not i would just i think me either i'm too selfish or whatever but um i'm not sure there's just that much to do as the secondary and to david's point if i was asked to be the primary i think i could probably step in and do ten percent of what nat would do or but uh here's joe lonsdale's super blind spot he made this very gender specific with men and women in certain roles and he basically is saying you know a man who takes six months off is a loser so he is not just giving his opinion he's attacking people who do take the time off and then he says listen in the old days men had babies and worked harder to provide for the future that's the correct masculine response so i think what triggered people about his response and perhaps rightfully so is that this is just a video but jason here can i say something like degrading men who take time to take care of their kids but look we've talked about this a lot there is an opportunity for folks like us to take a step back and slow down in how we interpret a tweet that's written at eight a.m in the morning super quickly yeah i'm not advocating he'd be cancelled and and not just him but everybody else but like there is an opportunity to teach empathy here where i'm not saying you have to agree with him but you can also choose to see what he's trying to say through the exact words that he used decide that you agree or disagree and then just move on of course you know what i mean and and i think that the reason why folks may want to do that in this case but in most other cases is eventually it will be you that makes a mistake sure and you want to be let off the hook by other people that are empathetic enough to say i really disagree with what you're saying but you don't deserve to be punished beyond disagreement i love what your mother said you know the mistake that we make might even be on the spot today i might have already made it i've already made it i agree that we should all just be a little bit less judgmental and um there there the there is an element there is a judgmental element in joe's tweet that that's probably the part i don't agree with is look if someone wants to do that fine take the time doesn't necessarily make them a loser but it's not a choice that i would realistically make yeah it's totally unrealistic it's not even startups like you know i i'm getting these i'm getting put to these multi hundred million dollar decisions a day i can't you know i could pause the business but that'll have so many downstream implications unfortunately i picked a job or am in a position where i can't check out even if i wanted to so i try to do my best that's the point you were trying to make that wasn't that well articulated i don't think any of us are in a situation where we can straight up walk away from work for any meaningful time i mean on a daily basis destroy my business yeah we get texts we get emails we get phone calls that we have to answer and so it's not it it you know almost definitionally isn't an option to just walk away but for those who it is and if that's their choice that's what it is the the great thing about freedom isn't that you can say whatever you want it's that you don't have to listen to what anyone else is saying and you know really well that disagree with joe i feel like you always have the option to not listen and you always have the option to walk away and yeah and unfollow and the whole idea of cancel culture and you know punishing people for the things they say regardless of what they say and and the censorship and all the shutdown of voices and channels for people to have a voice i think it um it takes the freedom away that's inherent in the idea of you know your choice to not listen yeah and and it's almost always totally hypocritical so this is a post script on the whole chapel debate it turns out that the leader of this the anti-ship hell protests who've been trying to get him canceled at netflix it turns out this this person has like a treasure trove of the most angry hateful vile tweets that anybody has when you put it in the group chat i thought that that was a joke the the things that she wrote were so beyond the pale beyond no we can't i don't even want anybody to speak these things i don't want to include it in the show notes they're literally the worst tweets they're the worst tweets seen seriously completely racist like i got racist i've seen such explicit racism in the 21st century basically aside from these tweets and um and this is the person who's trying to cancel chappelle was out there with the megaphone and who the press was fawning over by the way and she said in her thing yeah those were from a long time ago i've already owned up to those so let's move on wait oh owned up how owned up how and it's kind of like you know let me play the empathy card on me but then you know i so meaning i expect you to see through what i'm going through and that those expressions were in a moment in time so see past them and see my true character that's what she's asking that's what she's asking the world to do you know about her but then you're not willing to do it any for anybody else and that's where i think that double standard just doesn't work anymore and i think this is what people are getting really fed up with yeah yeah and i would also say that her tweets weren't funny they weren't attached oh my god they are so gross i don't have a customer service problem with this beeping beat no there's yeah i want to bash i want to bash this you know beeping asian or whatever over the head blah blah blah blah like a lot of racism towards asia you know um asian people no there was homophobic tweets there was asia asian hate tweets i mean it latina hispanic i mean she wasn't even trying to be funny that's the thing it was even it wasn't even a failed attempt to humor so here you have chappelle who i think is dishing it out in an equal opportunity way making you know funny uh observations about really he's criticizing our culture not specific groups and he's being deliberately misinterpreted by the people who want to cancel him there really to think that chappelle's standup routine is hateful really requires i think deliberate uh obtuseness you have to deliberately misinterpret what he's saying and so you have these people out there trying to do that and meanwhile they are guilty of that it's a total act of projection because they are guilty of everything they accuse chappelle of well not all of them this person in particular the leader the leader and of course the press doesn't dig any of this up it all happens through the through kind of internet slus that would be a narrative violation david if somebody is virtue signaling and they are leading a cancellation movement it's it's kind of a narrative violation to say well they maybe they should be cancelled by the same standard or you know quite easily i think the thing that i don't think she should get canceled let's just let's there you go yeah yeah i don't think she should be canceled but i and and this what if she said when she was drunk what if she had a nervous break i can only imagine that the difficult path that this lady has gone through and on the off chance that she's listening i'm totally cool with your journey i understand you made some mistakes we've all i'm gonna let you off the hook can you please try to let the next person off the hook i think that would be a nice place for everybody's aim to go and then and just to circle back with with joe when he started explaining himself itself in the thread when it became a conversation with a wider group of people the journalists went on the pure dung cancellation route but then there was actually a productive discussion about between ceos etc and i thought what was very interesting about it was he started talking to gary tan who you know was like listen we have a four-month leave practice at our venture firm and and joe said do you really take a hundred percent off cold turkey or did you work part-time and stay in touch like a responsible leader of your firm and of course gary did just that right and then joe says you know what i shouldn't have written loser and appreciate the push pack in more intensive operational context losing key leaders cold turkey for six months seems unnecessary but i respect the different takes here and i think that really is an actual good discussion about this is hey well maybe if you're an intense leader and you don't have the ability to take a couple of months off well maybe you should take a couple of fridays off and and then there was a really interesting discussion what's better for a leader to do spend a little more time every year or to spend three or four or six months in the beginning when you're as you just said chamoth on the periphery here and trying to be helpful on the margins maybe for the secondary person if it isn't 50 50 sacks it is actually better for you to pick up some fridays or whatever and take over the whole i'm glad you read that clarification by joe because i think what he basically is saying is that yeah he the initial language he used he he would he basically clarified that and it sounds like what he's saying is listen if you're on a high performance team and you're the star player and you disappear for six months that's gonna cause your team to lose so i think that's maybe what he was saying that's a perfect analogy sex because if we were looking at lebron james or kevin durant and they had a baby mid-season or draymond had a baby season which i'm sure has happened to you know folks it's not like they say i'm not playing the next six months of games they miss one game maybe two they go back on the road and i think everybody understands like yeah you can't give up one of your 10 primary years or three years left that lebron and kd have left i'll give you one final anecdote to end this chapter of our discussion today uh 2007 at facebook at one point in like one of the umpteen reorgs we were doing as we were trying to get out of the primordial ooze i was in charge of hr and everybody at that company was young except for a handful of people and then there was finally a person and i think it was our this hr person that that at some through some weird convolution of events reported to me uh who got pregnant who was pregnant and we didn't have a policy because nobody had ever gotten pregnant before and you know i remember saying oh we have to come up with a policy and what i did was i was like well what would i want which is the easiest way for me to answer most questions yeah and and i came up with four months for either the father or the mother irrespective of the context and that's how we started the original policy four years later though when i had my first kid um i took like three weeks and it came back because the grind was too hard yeah all right i think i think where we have to go is it's been a crazy week of uh the reconciliation bill the infrastructure bill and how to pay for this uh incredible spending it's been a meta week it's been it's been a meta week i mean and this builds on top of our discussions about inflation as well as the supply chain issues that builds on the conversation we had about covet and the new president so we're trying to get the wealth uh we're trying to get the reconciliation bill done and part of that is hey how is this going to get paid for and in the course of one week we've seen uh the tax proposals flip i think multiple times to ones that have never been tested and may not even be legal in the united states of course i'm referring to a billionaire tax which was proposed which would be a penalty or tax on assets that are liquid but that have not yet been sold and it would look back three years essentially going after bezos or elon lowry sergey basically going after the top 10 billionaires in the world and then maybe it was going to be the top 700 then it became a millionaire tax all of this to try to pay for these bills while so much money has been poured into the system that you know nfts and stocks are going through the roof where do we want to begin gentlemen should we does anybody have thoughts on this brief billionaire tax that was floated and what that says about where we are as a country in terms of how we think about the success of our greatest entrepreneurs do we want to talk about what's fair or the process well i thought the the process was insane and what was crazy was that you know ron wyden had been working on this proposal theoretically for the past two years and at no point did he bother to float the trial balloon with his colleagues in the senate to even see whether these people actually supported it beyond some folks on the progressive left who are ideologically fixated on you know this confiscatory way of running the country the funniest thing about that bill to me and i let the powers that be know this is hey guys i've always been on the record i'm happy to pay whatever tax you want i feel super blessed to be in america whatever i'm going to pay 30 80 i don't care but i had a real issue with the way that bill was written because i'm like um the democrats are writing a bill that will disproportionately tax democratic uh successful billionaires and it'll leave intact the coax who is literally the boogeyman to the progressive left who wants to write this bill and i thought how could you even write this bill this way it is so stupid you're saying because those people own private assets and this goes out guys guys like me would have been paying billions of dollars and the kochs would not have paid zero because their entities are private and university just so the audience understands yes how insane is that and yet we're the ones that is a great second order observation so these people clearly didn't think through that was my only issue with the thing it's like if you want to try to ram and jam this thing through go ahead and try i'm not going to be the one that that you know files a lawsuit the day after it's passed and takes it to the supreme court which will get hurt and you know this conservative supreme court would not have allowed this this tax to stand you can't target 700 people uh but by the way the reason you can't target 700 because there's a slippery slope from 700 to 7 million to 70 million and what it does is it allows tax and spend politicians a blank ledger to go absolutely crazy and just fund every single harebrained pork barrel scheme that they can come up with and that's really what we stopped was an important slippery slope and then in its place i think is a tax that is fair a simple surtax on adjusted gross income if you're above x you pay 5 million and if you're above y you pay another three so eight percent five percent on every kind of income and i think like that's a really reasonable way to get folks to pay more that seems like a good start but the first version of the bill was so stupid and the thing that really anchored me though was it targeted democratic successful people and left alone republican successful people written by the democrats friber what are your thoughts on the confiscatory nature of this i've never heard the word used that way confiscatory where we're going back and saying listen you won so much we're just going to take 20 or 30 of it we all pay property taxes so we there is a experience we've all had with paying a percentage of some of assets that we own people of all income brackets every year to your local government to fund local services that everyone uh participates in so you know i don't think it's unfounded now if you look at history as a guide you know france introduced a wealth tax to people making over uh i think it was 1.3 million euro per year and it was shut down and came back basically 1999-2000 and between the year 2000 and the year 2016 25 of millionaire households emigrated out of france uh during this period and the amount of tax revenue that was lost during that period of time was greater than the new revenue generated from the wealth tax that was introduced and so france ultimately scrapped the wealth tax um and there have been a number of other you know reasonably good examples of european countries putting in place these wealth taxes and then kind of removing them uh later so um you know on the one hand i i think that we've all seen this experience and switzerland does this i think you get taxed on your total assets in switzerland you have to go negotiate every year with respect to how much you pay it's a very weird process so on the one hand there is this kind of experience and and precedent for paying some percentage of assets sometimes it's a targeted asset and sometimes it's not but the longer range consequences we've seen is like you know immigration and people realize there's always a better choice but the question we have in the united states if we introduce a wealth tax like this where will successful americans emigrate to um you can see how people could leave france and go to belgium or go to the uk or go to switzerland or go somewhere else where they might be better off uh where where are americans gonna move to canada you're a successful canada i mean are you gonna move to vancouver i mean you're from canada but zach would you move you know where would you move to you know it's almost like there ends up being this kind of you know i think really interesting experiment that will be run here now remember this wealth tax was introduced by warren and others last year so this wasn't some new concept that was fly by night this has been one of those things that's been on the shelf for a while what happened is they pulled it down from the shelf and said let's try this they've never they've never had committee hearings on it uh they've never had committee markups on it it's been tried and repealed in european countries and like you said they pull it down at the 11th hour why because their carefully laid plans which they've been concocting for three months were thrown overboard when cinema said you wouldn't support the rate increases now i don't know why they wouldn't go to her at the beginning of the process instead of waiting until the end of the process but so because of that they're scrambling around trying to find any source of revenue so it's oh will a billionaire tax work no well what about a corporate amt how about that no what about a millionaire surcharge these guys are like burglars rummaging through the house they hear they hear the sirens they hear the sirens coming and they're like what can we take oh the tvs are bolted down can't get that where's the jewelry what can we take and it's just you can't set you can't set tax policy this way and this whole idea that we can set tax policy based on our intuitions of fairness without having hearings to ask the question what will this do to the economy how much damage will it cause this is absurd i'll say it's really important to note um the market is telling congress something here and the market is members of congress informed by their uh their constituents the market is saying maybe we shouldn't be spending this much because there isn't a place to fund it and no one's raising their hand and saying this is something we can all align on and so i think the the more important fundamental question is are we really equipped and do we really have a general economic interest economic interest meaning people measure things and vote with dollars to support these sorts of social programs and it seems to me the indication is no and this seems to me to be primarily a response of the pendulum swinging the other way post the trump era where you know the trump era was all about blowing up these ineffective over-regulated bloated government infrastructure and programs and people and and bureaucracies and now we've kind of found ourselves through our voted representatives swinging this other way but it turns out maybe we've swung too far and the market is now voting and saying this just isn't a a a playing field we should be on and so you know where they end up here i think regardless it's gonna end up needing to be some sort of reconciliation on spending to make this all work let's be honest bernie sanders and elizabeth warren were did not win the nomination the country specifically wanted a moderate uh biden was sold as a moderate go back to the way it was moderate dems like clinton like obama this is the classic coca-cola this isn't new pepsi nonsense and we got hoodwinked basically and i think what a lot of democrats are seeing now especially the moderate ones is hey wait a second biden is warren and bernie and sheep's clothing perhaps uh and and we didn't want this this we didn't want trump he was too hot and we don't want this to left crazy let's just take everybody's money randomly change the tax code i don't think american citizens want to live in a world where we change tax code at the 11th hour that is scary to people all people people who have savings if you care about the economy but yes but these progressives i think these progressives so so it used to be that taxation was a necessary evil you you you tax people because you got to pay for government and government programs everybody hates it but but you do it and you try to figure out the way of achieving the revenue government needs in the least destructive way possible but i think progressives now they're so focused and monomaniacal about this issue of income inequality the fact that there's some people who've gotten richer than everybody else that i think they're willing to tax those people i mean they would like to siphon off money from those people i think they would siphon it off just to light it on fire just to level people and so they don't really care what the impact is going to be on the economy well i mean and their position was in fact ban the billionaires that was their roof but you know before we get to that i just want to say these rules i think americans want the rules to be simple and i don't think people want you changing the rules at the last minute and then making them retroactive i think all americans want taxes to be predictable and simple not just change them willy-nilly because you change the budget this seems so unthoughtful and crazy chemaf your point i have two points to make the first is that i don't think anybody really knows what's in these bills and as a result of nobody really knowing what's in these bills they're used as negotiating chits so case in point when biden came out and said you know we have a 1.85 trillion dollar bill now and we're ready to get this done so that he could you know fly to europe and you know fly to cop 26 and kind of you know declare victory unfortunately the progressive wing of the democratic party in the house said no i'm not ready to dance yet and you know they have consistently refused to sign an infrastructure bill until they got what they needed from this other bill and so when pelosi called the vote she had to pull it because they weren't going to get the votes necessary to get this bill passed so what this says to me is that even with spending it doesn't matter whether you're spending five because that's a i think it's a trillion dollar bill right that's a one trillion dollar bill this is a 1.875 trillion dollar bill nobody cares about the quantity and nobody cares about the details they care about some perceived moral victory this is the only reason why we're seeing this you know mexican standoff that we're seeing today if these things were so substantively important we would have passed the first bill we would have negotiated a reasonable second version and passed that too instead we're here going through the end of the year with nothing done and i just want you know the democratic leadership who listens to this because we know a lot of people in washington listen to this podcast you guys gotta get something done because if you go into the midterms with nothing done with the democratic president democratic senate and democratic house this is going to be a bloodbath well this is why something will will get done but you know i think the political realities are that at the end of the day the democrats will come together and pass something but it's concerning that we're just talking about doing something because it will help you in the midterms you know the immortal words of nancy pelosi you have to vote for the bill in order to find out what's in it i mean at the end of the day we're not even going to know what's in this thing and um you know we're spending another it'll probably end up being a 1.75 trillion dollar bill it'll be stacked on top of the spending that's already happened one point remember buying already passed 1.9 trillion of coveted relief another 1.2 trillion of infrastructure no that hasn't passed yet well it's going to along with this now 1.75 million sorry 1.75 trillion of this new social spending bill assuming right so it's about five billion five trillion dollars five trillion progressives will have will have set the stage for this to be perceived as some sort of failure it's by the way david if you go back then if you take that five trillion and add it to the all the covid before and all of the uh the fed buying we've probably had one entire turn of gdp so call it 20 to 22 trillion dollars of money created in the last three or four years right now you go back j so so now so now you go back to jason what you started the thing that i have struggled with the most in these last few weeks is trying to come to a conclusion on inflation my worry is that it's here and it will be persistent and inflation comes in two ways way number one is if you massively increase the supply of money why let's just say the economy had a hundred dollars and now all of a sudden you just print another hundred so now there's 200 what will happen is all of the goods and services that make up that hundred will get repriced to absorb the 200 so prices go up inflation goes up the second way that inflation can happen is if middle and lower income people buy and spend because when rich people have extra money they just buy financial assets that's why you get financial bubbles but practical goods and services are bought by average everyday normal working folks and their wages are going up and so i think what we've created is a really distorted inflationary cycle that's going to really hurt the united states because as sax talked about we cannot print enough money to pay for the debt when interest rates go up this is this is the number one please this is the number one thing causing me concern as well is that you look around it's all time highs for everything it's all time best everything nasdaq and s p all-time highs crypto markets all-time highs shibu inu worth 30 40 billion dollar bubble uh i'm seeing sas real estate i'm seeing sas multiples at all time highs so you have to wonder is this a new normal is this sustainable or is it some sort of inflated bubble then you look at the inflation rates 5.1 percent to chamas point it might be persistent you look at treasury the treasury uh interest rates the yield is 1.6 on the 10-year t bill okay so effectively your real interest rate for savers is 1.6 minus the 5.1 percent inflation rate you're at negative 3.5 percent if you just save your money in t-bills in sort of uh risk-free you take the risk-free return negative 3.5 percent so now you have everybody going out there trying to chase yield because how do you earn a return on your money you don't want it to be uh you buy you buy stocks or nfts or houses so people start going into riskier and riskier assets to basically try and make up for the loss of inflation and so you have to try to hit the one outer yeah so then okay so so you have to ask yourself okay so back to this point about all-time highs is this because everything is really this great or how much this is driven by these sort of distortions 50 50. i mean i'm just putting a number on it like obviously the industry and the economy is doing fantastic but it seems 50 50. here's the other thing that i wanted to make in just the last portion which is i think what we've realized as well at the end of this is i i actually again now to use this empathy card i'm going to give the progressives my empathy card and say i understand what you're trying to do and i believe in a lot of what you're trying to do is to even the starting line for everybody right now a lot of what you end up proposing distorts that goal by trying to you know even out the outcomes and even the finish line but i really do think they want to even the starting line but here's the thing that we all have to realize now all the things that the progressives want to tax and fund are actually being done by private corporations and i think we just have to acknowledge that and make a decision about whether as a society that's okay or not i'll give you two examples number one is the federal minimum wage we have tried for years and we have debated raising this minimum wage it still sits today at seven dollars and 25 cents just this week mcdonald's moved their minimum wage up starbucks moved their minimum wage up we're talking about you know entry-level quick service jobs that now pay 17 to 25 dollars per hour right so two and a half to three plus times the proposed federal minimum wage the free market so and so and so what government didn't and wasn't able to do the free markets have done second example we tried to get free community college inside of one of these bills it was drops now depending on where you go the the nation's largest employer amazon actually will just pay you to go to college right so they are replacing that intention and a version of the gi bill but as a private organization so i think what we also have to realize is that maybe some of these policy decisions is actually a little bit of you know getting tilted by the fact that private organizations are acting more nimbly to actually implement this progressive agenda because it actually exists in america if you're willing to take the time to look let me ask a question about inflation if who is inflation going to um hurt the most and who's going to gain the most from it because it does seem like consumables gas station you know supermarket trips et cetera are going through the roof in that case you know that's going to have no impact on the top third of people because a gallon of milk at three six nine dollars doesn't matter but then you look at inflation on stocks it's going to make it go up so a rich person isn't impacted by their gas or their groceries but somebody in the middle class or uh who's poor that's going to dramatically impact them so if we spend more does that actually create a larger wealth gap saks look inflation is devastating for the middle class um if you have savings it if you can afford to put all of your savings and financial assets the way that the super wealthy can then your financial assets will go up but if you have a good your sort of middle-class income and you don't have your in your savings or in something more conservative you're gonna get absolutely uh eroded by inflation over time it's gonna kill you and you know the housing prices will go up the the um the middle class young couple that wants to buy a house for the first time that's going to be much harder to achieve because housing prices will inflate away so i think you know there is there are some effects that are awash so for example prices go up and then wages go up at the same time but savings can really get hammered if you're not in financial assets it hurts the middle class first but it also hurts it hurts everybody because again unless you're perfectly hedged going into a rising rate environment you will own assets that are just speculative questions a scientific question here are we starting to go into a self-fulfilling prophecy around inflation allah what happened in the 70s which is we've been talking about it so much that anybody who is thinking about raising prices says well everybody else is raising prices so even if my grilled cheese sandwich hasn't been impacted by all of this and i didn't have to give raises to my employees they're happy at their current salaries i'm just gonna put two dollars on my grilled cheese and we just get the cycle of everybody saying how much can i add to the cost of something i am trying to remember there was an earnings uh interview i saw yesterday uh god which was the company anyway they're um their company in the industrial supply chain and he said that they're raising rates to get ahead of the supply cost going up for them um so that their margins won't get squeezed and i think that's uh it's almost like that what you're referencing is a little bit of a run on the bank mentality where um those with uh pricing power raise rate raise prices and as a result you end up kind of seeing the the trickling effects because competition can't catch up so if everyone's kind of raising rates and it's not enough competitive advantage the one thing that's making this even harder right now is the gluts in the supply chain which are reducing the competitive market dynamics that we might normally see where one customer raises it one company raises rates and another company says wait our rates are going to stay the same but because so many people are challenged by getting product there's enough demand for their product everyone can raise rates together we're seeing this in the energy markets now so um yeah i mean this is kind of part of the scary scenario that everyone's trying to manage against so i don't know what the science is and i'm not an economist but it certainly seems to me like the psychology of managers and business owners and boards is such that they're saying let's get ahead of the curve let's raise rates and as a result you're seeing the trickling effect of inflation throughout the whole economy so um a little scary sex what do you think psychologically is going on with raising prices yeah so so expectations are definitely part of the inflation gain people raise prices if they expect inflation in the near future and then that feeds on itself and that's how if you look at countries that have had hyperinflation that's how you get a spiral now i don't think we're gonna have hyperinflation here but we're at 5.1 percent now and if people think it's going to be worse next year and the fed's not going to raise rates it could even be higher next year and i think people are going to start getting upset about this you know when they buy their thanksgiving turkey and their christmas ham and those prices are way higher than they think and they're already paying gas prices that are a lot higher than they're used to i think you could see a lot of unhappiness out there one other thing i'm thinking about is is the logical thing for a person to do in this hyperinflationary you know market is to say you know what the these i went to look at a car and i wanted to get to drive in the snow and i was like you know what i'm just going to hold off buying this because i'm not paying 15k over sticker so and i can pay 15 seconds i was like yeah do i want to do that ah the other car is okay i'll just put snow tires on it so are a lot of people champion as part of this psychological you know spiraling out of control situation then some group of people might say you know what i'm going to opt out of consumerism and i'm just going to lower my burn rate and stop consuming which is also bad for this you're going to stop consuming food your food prices are great instead of getting you know filet mignon you might get chicken okay well there's gonna be a lot of unhappy people who are eating chicken for christmas instead of fillet i'm serious well i'm coming to your house so i'm getting fillet so i'm good i'm gonna go to your house for lunch and i'm going chamots for the surf and turf after guys rich people don't create inflation the middle class and lower middle class create inflation there's just not enough rich people to matter they're irrelevant so when you look at the last two or three spikes and waves of risk that we've seen globally they've come from large multi-hundred million person cohorts of people right those could be in asia those could be specifically in china those could be in the united states plus all around the world because of certain loose monetary conditions that's what we have now we have a multi-hundred million probably approaching more than a billion person strong liquid buying pool of people that are again as i said if the if the lowest on the pecking order is now making 17 bucks an hour we all know this guys it's not as if the inflation stops at 50 000 bucks a year everybody's wages rise so consistent and persistent wage inflation will allow you to spend more because that's just what people do we also have high savings rates so people will feel more flushed with money the point is that everybody will spend they will spend more you know you can't get cars you can't get this you can't get that all this pent-up demand will get fed and the downstream implication is i think that prices will rise but it will disproportionately hurt the middle class in the lower middle class and then these asset bubbles will probably deflate or they'll have to get re-rated and if the fed stops tapering and you know hikes rates two or three times over the next 12 or 18 months man this is an ugly ugly uh stock market one of the things people have been asking me to ask all of us on the pod is what are our strategies right now given the turmoil we're in so maybe we can go around the horn and what we're thinking about in terms of our strategies to deal with inflation while maybe not getting ahead of our skis and being the bag holders anybody have i'm not people thinking i'm not going to answer this question and you you know why because i can't got it okay because of the public mark i don't i don't want to even answer this question yet okay well let me can i i'll let me further describe the the problem um so this happened in the late 1970s we had stagflation we had sort of every year we had um increasing inflation because of the expectation game and the thing that broke it was you had paul volcker come in at the fed and he jacked up interest rates and uh he actually caused a pretty severe recession in like 80 i think it was like 82 81 81.82 i think by 83 we were coming out of it and then the economy absolutely boomed interest rates came way down because he broke the back of inflation and actually interest rates came down for you know as a result of volcker and the fed controlling inflation they came down for 40 40 years basically and that those that decrease in interest rates fueled everything it made debt a lot cheaper it uh it made the stock market boom because the net present value the discount rate went down so that present value of all those future earnings went up um so you had it it set the stage for the boom in the reagan era and beyond in in the clinton era as well now what's the difference between then and now well for one thing the government debt as a percentage of gdp when reagan took office was around 31 okay so when volcker jacked up interest rates it didn't really create that much more of a debt service cost for the united states for the federal government now today the uh the government debt uh is 125 of gdp so if and this goes back to the to the druckenmiller point from previous pod if the the fed were to jack up interest rates to say the historical norm of 4.9 percent debt service would go from 2 percent of the federal budget to 30 you would have a massive crowding out of government programs so how we fund all that debt service very unclear so we're caught between a rock and a hard place the rock is we have inflation that could be persistent the hard place is the debt service so you know the tools for controlling this aren't exactly clear so this i think is fundamentally the the problem is it's it's not clear whether we're going to have you know interest rates going up or persistent high inflation uh those are the threats to the the sort of economic boom we're seeing now the flip side of it is that the reason why the stock market is one of the reasons it's at an all-time high is because earnings right now are fantastic so the economy is doing very companies are doing very well but we just had for q3 the gdp growth was at two percent annualized which was sort of an anemic number it's a low it's been since this covid recovery started so it's um you know it's it's interesting we're at all-time highs but there's also these like major storm clouds on the horizon and i'm not gonna like pretend like i know what's gonna happen i just you know when when things are this good i start getting nervous when it's this easy to make money across everything the stock market the crypto market yes the sas investing we're doing we know we're on our heaters can i just say that's the that's the part that really scares me so for example when everybody gets tilted because there's some sheba wallet where 8 000 turns into 5.7 billion right so for those that don't know there was a you know shiba inu coin which is a coin which was basically there to ape uh the other coin dogecoin the dogecoin right a meme coin um all of a sudden some guy uh 13 months ago put 8k into it because the whole market cap was 80k and then all of a sudden over the course of these 400 days that wallet holds 5.7 billion dollars of value or 10 the entire market cap of shiba um people get tilted by that then there was an article today in bloomberg where there's a gentleman a 66 year old man in singapore who's a billionaire right so he was successful in his own right however he had made in his entire career about one or two billion and he has made seven billion in the last two years speculating on tesla call options wow i'm not kidding so buying short dated calls right writing the writing the way making money allocating the gains buying the underlying tesla security over and over and over again and so you know i was talking to nat about this and i was telling her these these examples and she's like that's what sounds like a bubble because it really is very difficult to be in business and to make these decisions and to be real and also if you're a capital allocator or you're building companies like how do you know if you're doing a good job if everybody just is i'm gonna be right back guys i have to i have to deal with the goods yeah okay we got a quick baby change i think what's hard about this is okay so so one of the areas where it's sort of like best times ever are is the sas market which is where i invest in and i'm obviously investing in very very early stage companies but we're seeing valuations now go to multiples of arr that we've never seen before 50 75 oh i would say a hundred times i'd say a hundred times ar is sort of the rule of thumb right now and you're seeing what scale a five million dollar company is worth five hundred million uh anywhere from one million to ten million i mean absolutely between 100 and a billion dollars which makes no sense well no it does if well i'll let me give you the argument for why it could make sense okay let's say the company is expected to go 3.3 x this year and 3x next year that's basically a 10x over the next two two years so that 100x in two years will only be at 10 times ar multiple and by the way if you look at the comps for the companies that have gone public the sas companies have gone public like look at toast being worth what 30 40 billion so they're trading at 30 40 50 60 times arr in the public markets on big big numbers so how hard is it to go 3x 3x that is i mean going 3x is hard going 3x3x back to back that's like winning two and you know nba championships or being in the finals it's hard i don't think it's that hard i mean it's not for you but you're the king of sass i know i'm being dead serious for a saks founder with a million to go from one to three and then three to nine how many out of a hundred actually go from one to nine yeah i'll tell you yammer's trajectory and this is about this is over a decade old we went from one million in our first full year selling the product to uh well back in those days we looked at total contract value of seven million of tcv that was about five million of ar and then it it tripled the year after that so you know and then we tripled the year after that well yeah a category defining sas companies microsoft but but i'm just saying that it's entirely possible there's a lot more yammers today or companies with that growth trajectory so i mean but look this is what's led to you know our fund too which we started investing in 2019 which has a sas focus already has five unicorns in it from companies that we invested in the cedar city it's crazy so but look i mean when you're seeing like results that good where my head goes is okay this is too good you know what am i missing here or like what's the downside and how long will this just to build your just to build on your point there are these businesses that have i i would say interesting products that are growing well but they may not actually be very important companies yet they trade at enormous valuations and then you have these companies that are just so superb and i'm talking about microsoft google apple and facebook that now trade in many cases at some pretty deep discounts to their intrinsic value but this is the sign of this histrionic behavior that i think embellishes the end of a bubble right it's this thing where you look at a growth rate and you don't even ask the structural questions about business quality viability sustainability you're like oh well it's growing from 300 percent market you know it's only decaying to 200 percent i buy well it's like but yeah but what are you buying and is there any longevity and staying power this is why you know i've i think there are some great businesses in sas but i also think there's a lot of head fakes and in the public markets particularly people just want to buy that growth as david said because they're chasing yield they're not you know do they really understand am i buying this company because i really believe in this database technology versus that streaming technology versus this container technology they don't know any of those things well i i to so so this is the conundrum is i actually do believe like so i believe my own portfolio and i'm doubling down on all these companies and i do believe in sas and i think the reason why these sas companies get such great multiples is because they're pure software businesses very high gross margins 80 plus gross margins you know once the flywheel gets going they're very hard to displace i mean they have uh it's not just a recurring revenue subscription type business but you get expansion out of your current customer base so you know on january 1st of a new year you're starting with 120 150 of last year's revenue just from your existing customers and then you're stacking the new revenue courts on top of that so i am a believer in sas but when i see everything going so well it's sas and nasdaq and sap and crypto and then i see you know 125 debt to gdp and the the sort of radical uh spending that's coming out of washington i just start getting nervous and i don't know if i have like a prescription for people out there i would just be a little bit cautious right now and temper your enthusiasm but but look at the flip side of it is we could keep having a boom for five more years you know and so the more i was listening to vinnie lingam's um show on uh beep on call-in it's called it's called crypto music no he and sonny madrid do a great show that i think we all just got 25 bibs so we just you guys are all listening to his show it's called crypto musings they were talking about all the the dog coins the other night it was shiba inu and dogecoin and there's a couple others vinnie made a great point he said listen if you're out there listening and you're sitting on life-changing money and sheba you know sell take it off the table if you can key words being if you can so look i you know this boom could last for another five years it could last for another 10 years and the value valuations keep going up the earnings could keep going you don't want to miss out on that bull run but if you've got life-changing money in a in a highly risky position i'm amending my advice of let your winners ride to take some take some chips off the table prudently doesn't mean you sell everything but just take some chips off the table to diversify specific diversify yes yeah i mean i think it's absolutely i mean i gotta say when you saw these quarterly earnings there is no better business in the world than google single-handedly par excellence the most incredible money making machine that's ever been created and a close second as it turns out is microsoft unbelievable i mean just which is now the most valuable company in the world greater than apple well and friedberg's been saying this on the podcast forever but just to give people an idea q3 revenue at google was up 41 year over year to 65 billion dollars in a quarter and by the way that is high margin high margin the incremental revenue on the core google products uh generated an increment operated at an incremental 50 ebitda margin and they just adjusted their their capex depreciation amortization schedule because they realized that their computers that they use in their data centers last four years instead of three and the networking equipment last five years instead of three so they're like and i've been saying this since the beginning because i worked at google and earth is still there and he runs all the data centers in the networking infrastructure when i worked at google there was this amazing project where we built a 10th out i mean we didn't build it they built it a 10 000 port switch called fire hose which helped increase the throughput of the data centers and have these massively paralyzed indexing and um uh and uh and production servers um and there was so much investment made from the beginning in building the infrastructure stack the flywheel continues to move spin faster and faster and faster and here they are building their own servers building their own racks their own data centers literally the most ver they have their own fiber across the oceans um literally the most vertically integrated business in history with a moat that no one will ever be able to catch up on and i read all these nonsense comments on the internet about people being like why doesn't someone else go after search it's so crazy to me people fail to recognize that what we see is the tip of the iceberg at google and this flywheel is built by layers and layers of monopolistic in a good way monopolistic technical advantages that they've built into this business over the period of the past two decades and it is extraordinary beyond anything we've ever seen in human history how well this commercial enterprise has run and the reinvestment of capital has been extraordinary they've if you look at youtube in the quarter uh youtube generated this is insanity youtube is now operating at a nearly 30 billion dollar revenue run rate and that's just like pure margin incremental revenue for google layered on um you know built off of the same ad ad network uh that they were originally running on google obviously they have a different ad team now at youtube but youtube now has more revenue than netflix and it's growing at likely 40 to 60 percent year-over-year revenue growth rate whereas netflix is you know considered one of the fang stocks you know one of the top stocks and netflix is only growing at 22 percent remove netflix and just put google twice it should be and then you look at google cloud youtube in there on its own and google cloud is now operating at a 20 billion dollar run rate and you know they can just throw these services on top of all these flywheels that they've built and they become massive enterprises unto themselves i mean it is a behemoth that is effectively not a tax in a bad way but a tax on the internet because they are core infrastructure to service almost everything that we all consume and use yeah but they give it to everybody for free and they build the internet for everybody they have been extremely smart about competitive pricing as we saw recently they dropped the commission in the play store to 15 if i'm making an app and i'm giving apple 30 now i give google 15 i'm more inclined to promote my android app and that's gonna affect users and you know they're putting out this pixel six phone that looks like an incredible piece of equipment that's cheaper than that they're they're an incredible company if they are so incredibly well run at the top sundar is an incredible ceo um and they are they're running a money printing pass uh at amphitheater parkway in mountain view i was going to say jason to your point i was talking to somebody and one really interesting thing that this organization did was um a couple of years ago they basically went long google and microsoft and they shorted apple amazon and facebook against it and i asked them why and they said it's the best inflation hedge we could come up with at massive scale that could work in a way where you know we're long growth but we're hedged where you know the types of supply constraints that could come in and you know kick us in the ass would never affect microsoft and google the same way that it would affect apple and amazon which by the way in their earnings results they said right amazon has huge issues on the supply chain side apple has huge issues on the supply chain side amazon was up 15 they missed their numbers although amazon web services is a 40 year over year also on a big number 16 billion dollars in aws revenue for q3 so that as a standalone company is now on what do you what did you guys think about meta 60 billion oh my god i mean that was did you watch the video i watched the whole thing i watched two minutes of it and then i stopped watching pts i mean it's basically you you have facebook in the face of all of the things all the times they got their hand caught in the cookie jar saying this is going to be the new world but instead of us doing everything wrong and screwing the users and their privacy and democracy and creating strife in the world this time we're going to make it open source this time we're going to build a coalition and partnership and this time it's going to be awesome and it's it's like a dystopian snl skit where zuckerberg is describing the future and he literally describes how proud he is that you're going to be able to play grand theft auto and nick clegg is like yeah this is going to be amazing this time we're going to bring all the regulators and the scientists in to tell us how to build it and we'll have consensus of how to build the future and you're like did you just say that everybody in 3d is going to be in a virtual space beating each other up with bats and guns and killing police officers in grand theft auto luckily they didn't show a clip of it but it was basically zuckerberg taking credit for every single uh virtual reality or augmented reality thing you've seen over the last 20 years he literally took everything from education to hololens to you know poker games and he took basically credit that this is going to be the future in that instead of this time it being a closed ecosystem it would be an open one that supports nfts and don't worry this time i think any developer who puts any amount of their effort into supporting in any way zuckerberg's view of the metaverse is crazy when they could do it on a distributed decentralized crypto based open source platform you do not want to give zuckerberg any more power and if there is even a 10 or 20 percent chance that this is the next big computer platform zuckerberg needs to be stopped from doing it by the market i think you're crazy i think you've lost your mind i haven't yeah i i think you've lost your mind oh my god i have a counter argument too okay david you start well i don't even know if if i could categorize what i'm about to say as a counter argument i don't even know how to counter that all i would say is insanity all i would say is look i think it's really great that facebook is spending all this r d money on meta verse virtual reality oculus is a really cool product i think jason you made the observation that people use it once say it's the coolest thing ever and never use it again there is that element to it they have to solve that um using oculus for the first time was one of the most unique experience i've ever had with computing but i admit i don't use it anymore it's just not something better or worse than pornhub the first time but any event look i think i think the worst that's his way of saying words i think that the fact that facebook wants to do all this r d and virtual reality great um changing the name of the company however at this point in time it felt to me like a little bit like philip morris changing his name to altria group and by the way i don't buy the idea that facebook is like cigarettes i don't believe that at all i don't think it's it's bad for people in the way that it's been hyped up to be you're saying this is a pr marketing but it feels like they're running from their name and uh and basically it's almost like saying you know this whole business of social networking has been so sullied that we need to appear to be a diversified portfolio of companies of which social networking is just one small piece a deprecating piece yeah exactly and i don't i don't really buy into that and i i think if that was any part of their motivation it's a mistake because i think the only thing facebook should do about all these accusations is get up on their hind legs and fight because i think like all this these leaks from the so-called whistleblower i think this is a completely orchestrated political hit and they should just fight back and push back on it i think the dangers of social networking have been vastly exaggerated so it seems to me like they're buying into that nonsense by running from their name right so i at least would not have done this right now i would have won that battle and then if it was still important to change their name then i would have changed the name uh well they're losing young people at an extraordinary rate on facebook u.s teenagers were projected to decrease by 45 over the next two years young adults between the ages of two yeah we're expected to decline by four percent or tick-tock i think is probably more yeah tick-tock is big yeah yeah during that same time frame via leaked memo obtained by by the way i mean how in the world is facebook or instagram more dangerous than tick-tock i i don't get it no dick talk is deranged which but by the way our stan making or henry belcaster of all tick tock is reporting that we have like millions of views over there so there's some rogue did i say [Laughter] you're right the tick tock account there's an all-in tick tock account done by a fan and we got like two million views in the last week it is absolutely bonkers we just passed rachel maddow and a bunch of uh folks yeah we're more popular than all of msnbc yeah well i mean come on way to set the benchmark freedberg uh do you guys do you guys remember a year ago larry ellison had negotiated this deal with trump to buy tick tock for like nothing yeah he's gonna throw in lanai friedberg is uh supposed to be on tick tock yeah that's by the way uh xi jinping is on lanai right now and uh larry ellison got ticked fair trade nobody talks about the billy that uh ellison kicked into tesla right before [Applause] he's such a boss he made like 12 billion dollars 15 15 15 15 15 billion he's such a boss he put a billion dollar investment joined the board talk all talk all the the smack you on about this guy but he's landing spaceships on a drone ship in the middle of the ocean what do you figure it out and he'll figure it out and 50 next that's insane but wait i have one question for freeberg is zuckerberg pulling a larry page i.e somebody else become ceo of the facebook collection of companies and then he becomes the chief product officer and then doesn't have to go to senate hearings no i think he's way more active and driven in terms of product direction than larry ever was so i don't think they're the same person and i wouldn't liken these two and what about the meta strategy of changing the company name um by the way my prediction was that they were i should have done this on the pod a month ago i said they were going to change their name to meta i think that at some point as you diversify these businesses away from your core and you have this core engine driving the business um you know you have to make it look like these businesses can and will operate independently while they might get some leverage off of one another and one might feed into the other they need to be able to operate independently from a kind of public perception operating a management perspective that's what alphabet did it's a natural progression of states as you start to do things that are too far distinguished from one another um and so it feels reasonable i think you know is this a whole like pr rebranding maybe to some extent that's helpful but i do think that this idea that we need to do more than we're doing today and we need to make a big hard cold bet on it um is what this represents now the the the important psychological question is he doing it out of a matter of defense meaning like does this signal fear about the core business um or is it about ambition and aggression and re-bets on new opportunities and emerging opportunities that he thinks and that's the big debate that i think is kind of going on right now is how much often when you see people make big moves like this it's either out of greed or out of fear and i think some people are asking the question how much should we be afraid of the core business being eroded based on his making this sort of a big bet oh you think this could perpetuate that or it's a bit of a talent that this is happening a tell a guy right and that and i'm not saying that's the case i'm saying that's the question right right and that's the question a lot of people are asking is this a tell that the core business is at serious risk why do you he's putting 10 billion into it this year for example this apple you know ad revenue business i think is climbing by billions of dollars while facebook's core business is being affected by the the cookie tracking policy change on apple ios so at the same time that you know apple's reaping these benefits from the changes that they've made in ios you know people don't really have great visibility into how much it's really affecting facebook's ad revenue at this point and this could be as you point out to tell um that maybe things aren't that good and he needs to diversify and he needs to make a big aggressive bet elsewhere so um you know we'll see i mean an important question shamatha are we going to celebrate the birth of both your and friedberg's daughters with a poker game by gambling do you want me to you want me to give you my thoughts on that or no you don't no it's a joke can you take a paternity to go to listen i got a board meeting i gotta go bite all right uh for the queen of quinoa wait wait don't you want to know what i think i think on the meta thing i think the the risk is if google and apple take the hardware costs to zero because i think there's an incentive in a highly fragmented ecosystem you have to remember when apple introduced the iphone there was nothing that came before it so it was completely groundbreaking and i think what facebook has to figure out is how to make their vr experience so revolutionary that it attracts developers and in the meantime if apple and google figure out how to kind of give it away for free and just kind of make it a low-cost hardware game where everything else jason as you say is this kind of open source thing where it's like a browser yeah right where everything just exists in a d5 kind of world like the web in the internet then then it's a little bit more problematic for all the money spent that's what they have to figure out do you think that it's going to be vr or ar what wins the day with consumers well that's a good question i mean they're very different experiences um both can win but we're not winning 20 years from now which one will be used more for 10 years from now 10 to 20 years from now which one will make more money be more relevant be more beautiful well i mean ar the dream there is that you wear these glasses that have like the terminator view where it's like scanning the world and giving information you'll never forget anyone's name again stuff like that um that would be kind of useful maybe um vr i think is more about immersion it's really like a gaming experience i think at least now i think it's all about ar basically what he was saying there he was talking about vr i think vr lets you make the worlds and then ar lets you experience them concurrently with the real world and it's the same tools and libraries and kits as a developer making it for vr ar is going to be pretty i think seamless and so i think apple has skipped vr on purpose and they're going to ar i think google is basically going to go directly to ar and then where does that leave and then microsoft already has hololens that they've been investing in heavily and i think they got the biggest lead uh that at least we publicly know about so i think it's gonna be a race for who can get ar to work and vr is just like kind of a waypoint on the way there there's a lot of stuff going on and i'm i'm sure that people will want to check out of the real world for some amount of their life but they'll probably also want to be in the real world for some a part of their life and at some point maybe if those two things merge that distinction won't matter as much and i think if the experience is compelling enough it could happen well i mean if you think about us playing poker on the poker one of those poker apps if we could put our glasses on sit in our room and see each other at a poker table you know like if bogut wanted to play from australia and he was you know projected into the seat on the game when we all saw them there with glasses ar glasses that would be amazing wouldn't it sure be able to you know have two of the people at the game be projected in as it were could be especially if it was diego i mean that would be pretty great i mean for the update for the good of the game i i did a tweet where i said listen vr people leave it on the shelf and then you know palma lucky and a bunch of people got in my face about it and then we had like a actually really good discussion um and i said well what about serious gamers because i'm talking about serious gamers they all buy it and then they never use it they said yeah it's not for serious gamers i said okay well what about ipad gamers and casual gamers and bejeweled and candy crush they're like oh yeah they're not interested in it and i'm like well who are the gamers then is it the intense ones or the casual ones they said no there's a new category the number one game like rec room beat saber and golf are like crushing it uh with a million users a month in some cases you know what they all have in common they're physical activities where you get some amount of exercise and it would be very difficult to coordinate in the real world i know but jason when you look at things like like axi infinity where you know there are play to earn movements that are happening in in sort of this you know layer three kind of d5 world where yeah you're getting paid to basically you know play games that could be a job and then you will spend eight to ten hours in the metaverse of some sort so these things are very possible i find it so dystopian uh yeah that's true but i'm sure that our parents find some parts of our lifestyle dystopian and you know we find certain parts of our kids lives dystopian it's just what happens yeah i don't know all right everybody we will play poker we will play poker yeah we gotta play poker at some point we'll play poker either either tuesday or thursday okay yeah well that's good perfect babies will be like almost which which days are you gonna flake tuesday and thursday yeah which day will you play tuesday and thursday and thursday sexy people listen to me do i have to come pick you up i can play on tuesday all right everybody four the queen of quinoa the rain man and the dictator i'm jason caliconas we'll see you all next time on all in love you besties [Music] and they've just gone crazy with it [Music] we should all just get a room and just have one big [Music] we need to get mercies [Music]








my body is a wonderland if that wonderland is white soft and mushy sure and hairy too you know the worst thing about skin on skin sleeping with the newborn is that you know sometimes she roots and she goes after the man the male nip i know the problem is my nipple's covered in hair it's really awkward for everybody she start gagging i'll tell tally that story when she's 18. we're at her wedding it'll be even better hey everybody welcome to another episode of the all-in podcast i am wearing a blue shirt i am a pasty white old greek man uh who's balding and obnoxious and uh with me today is uh no no no no no you have to you have to say your pronoun bro am i oh and my pronouns are uh oh wait what are my pronouns my pronouns are beep beep and most people just call me a jerk with me today of course is my sri lankan urkel looking wearing a furry sweater hello everybody my name is chamath i have uh salt and pepper black hair brown eyes uh i am tall uh six foot two i go by the pronouns we king and stud muffin and uh uh i'm here to talk to you about uh internet security protocols i look like article i think people should just come up and say well i don't look like girls i'm the closest i don't look like urkel i look like a bollywood when you put your glass about welcome to the all-in podcast two out of the four of us are cancelled next up for cancellation socks yes i'm coming to you here from the floor of the new york stock exchange which was once land that belonged to the mohegan the montauk the oneida the erie and iroquois tribes you forgot the irish we own the seven points oh my god you literally did it you went for it saks i love you i'm uh isn't it important that at any moment that we're successful we have to flagellate ourselves and remind ourselves about that at one time all this land was owned by somebody else we stole it and also the greeks conquered the romans and so on but you forgot to mention you're also wearing a other shirt that is four sizes too large this is my slim fit so that's slim fit oh no here we go again sax has been upgrading the wardrobe he's changing we wait before freeburg does the intro uh jacob you want to tell them why we're we're doing these intros like this yeah i gotta pause before we get okay yesterday on the internet emerged a series of videos that were clipped of microsoft presenting their new suite of developer tools yadda yadda and corporate people got up and without any explanation started describing their physical appearance their pronouns their ethnicity their skin tone and their hair styles and the entire internet was like oh my god this is crazy woke-ism like what what is happening here this no i thought it was a skit i thought it was a saturday on the livestream and so right and so then as soon as they got called out by the entire internet they claimed that they were doing this for visually impaired people which kind of begs the question of why visually impaired people need to know what race you are like it's still playing into this like crazy weight race consciousness but then on top of it it wasn't just that we we know it's not that because then they start doing no no but hold on yeah also if you if you're blind and technically can't see you may not even know what blue means because you will have never seen the color blue or blonde okay right right but they were also identifying their races which kind of begs the question of why that's important but if you were born blind you would not know what that means either you're literally colorblind on the same footing as people who are not visually impaired what i'm saying if you're visually impaired you're using the wrong language that language is for the sighted people okay but i i'm just calling [ __ ] on their stated explanation that has anything to do with visually impaired because then they went on to basically recite the names of 10 tribes native american tribes that no one's ever heard of on on which the microsoft campus it used to belong to so which is why i was kind of making fun of that in my initial statement but so look this is just woke capitalism this is woke-ism out of control obviously they didn't see the election results earlier in the week it's clearly there was some level of virtue signaling i think in their defense they were trying to do it i think for the visually impaired the problem was they didn't explain the context and they didn't give instructions to the people on what to do so well but jake that video that was a clip pulled out of a broader context too right so like apparently this is common on campus or common there that this is happening all over so we just know it isn't common because i asked people online well it was optional it was optional it's optional to the common point i think the reason the internet reacted the way it was was i asked every single person who came at me because the work left came at me i just said can you show me another clip of this on youtube of any event where this occurred and nobody could so i think this was kind of a first when did you stop being a member of that that woke left jkl what was the mother like the hysterical side i've never been for bernie i've never been for elizabeth warren i've always been moderate always wait can i hear freeberg's intro yeah free bro can we hear yours my identity is an illusion it's an illusion created by the viewer and you can call me whatever you want i sit on the ground where during the haitian period there was lava and magma and nothing but co2 and methane and i represent those gases that are now lost to the oxygenation and the cyanobacteria that swarmed over this earth and took everything over and led to the formation of eukaryotic life and here we all sit today in our privileged existence thank you are you saying that you want to freeburger is just electrons hitting neurons in interesting ways yeah quantum foam is my pronoun so would you like to formally apologize for colonizing the dark matter during the big bang now or would you like to i feel it was inappropriate it wasn't fair when the cyanobacteria took over the the face of the earth and sucked up all the co2 and created all the oxygen and for that we all apologize for the genocide of the for the genocide of co2 and methane i mean those molecules were really happy and you know they had a very kind of like peaceful existence on this earth and you know we just came in and ripped it away just took it all away from them and you know and then the offspring ended up being us and here we are so apologies all right all right welcome to episode 54. everybody's canceled the final episode everybody's horrible i i don't think that the microsoft thing was bad and when you hear the broader context it was like you know that's just you know i think it's a reasonable thing that visually impaired people heard i'm still long microsoft and google and short the rest of the big tech so i'm fine with it there you go back to the stock price actually jamal do you think that the google long netflix short play is the right play i think the best trade on the best trade on the internet the most obvious simple money making trade is long microsoft google short big tech short the rest of the big tech short ibm short netflix no no no no short one meaning you can you can very comfortably short apple facebook amazon netflix and belong microsoft google so as a spread trade right right it's the most it's the best risk parity trade on the internet right now i mean period in the markets can you explain explain a spreadsheet so look look i i tweeted this a while ago but it's like and and again the i i think like well let me be constructive and say the people on twitter that respond to these treads are not totally stupid although i think they're kind of idiotic um i said you know here's how you can effectively you know i i said something about you know big tech and i said oh i can comfortably put my short on and i'm kind of trolling people when i do that because i'm not telling them the full trade and the real trade whenever you put anything on in my opinion is all about managing risk and the best thing about the internet and the stock market is that you know when you're betting on internet stocks you don't necessarily have to be naked long or naked short which comes with a lot more risk than if your long one security and short another against it so for example over the last 10 years you would have made a lot of money by being long amazon and short a basket of traditional commerce companies offline commerce i'm going to make up a basket but macy's jcpenney you know kmart sears right so if you're short those and long amazon that's what's called a spread trade you're you're basically playing the gap between your longs and your shorts it's independent of where the market generally trades it's one of the irrelevant of the market you're basically saying those stocks could go up but just not everything could work near amazon yeah when you put that trade on for example it's i'm going to bet that if everything goes up amazon will go up more than kmart walmart sears and if the stock market goes down amazon won't go down that much but these ones will go down a lot and you you're playing the spread so just just to be very explicit you know there was a very and i talked about this last week but uh i that this idea wasn't mine it's a borrowed trade from somebody who's a very well-known hedge fund manager who put it on in massive size and you know to be honest not knowing much of anything i just copied it but he's his initial trade was long google short facebook and that trade basically was at parity which meant that the long and the short canceled each other out for about the last four years until the last year it completely blew out and it returned about 80 85 percent so if you had put 100 and you would have made about 85 uh 85 bucks on this trade by being long google short facebook the the bigger trade at scale is actually long google and microsoft and short the rest of big tech and there's a lot of vague reasons why that this idea makes a lot of sense but what you're saying is they'll outperform the other basket of texas on a relative basis on a relative basis so so it's not like you're saying airbnb can't go up or facebook can't go up it could it's not going to go as well he's saying that the the trillion dollar market cap companies yeah not the airbnb oh okay and the reason and the reason why focusing there makes sense is there hyper liquid markets they have tremendous ways in which you can have massive size on so you could put a trade of 10 billion long versus 10 billion short i mean you can put mega size on on these things if you if you have real conviction and then the third thing is when the banks look at that kind of position they actually from a risk management perspective treat it differently than if you were just naked long any one of these things or make it long would be just making one bet yeah or you know or naked short which is even more dangerous so because if the market collapses by 30 both stocks might go down 30 roughly but one will go down 32 and the other one will go down 28 and so you're really only getting two percent two percent as opposed to the 30 percent of the so all the market risk is taken out when you make trades like that yeah the reason it's possible also today to do so at such a scale right chemoth is interest rates are so low so when you borrow on margin to go long the rate is very low and when you short the stock if it's a highly liquid stock it doesn't cost a lot to borrow too short that's so your actual you know uh carrying cost on that trade ends up being pretty low relative to the upside you expect so just to just to give you a sense of it my um you know when i tweeted that tweet out to complete the picture i was actually long something against my proposed short and i put it on in pretty meaningful leverage and um it's worked out really well because i was playing the spread i was basically betting that you know the the safest company on the internet today is google because they're both a platform company and to the extent that they're at risk at being an app company the risk is to apple but because they pay apple so much for search they're inoculated and so in many ways google is the safest and it's also as we've said before the purest money making machine on the internet you're referring of course to google paying apple 10 billion dollars to be the default search they own android so one platform and on the other platform they they pay them so much that they're going to be always protected and the second best company is microsoft and you we even saw it by the way this past week i don't know if you guys saw that but microsoft decided to take a broadside attack against notion yeah which is a productivity app that's been growing very well i felt this when i was on the board of slack when microsoft put its gun sights on us we always thought that they could not out compete with us and what it turns out is when you have a massive distribution advantage feature parity is enough and you can actually be slightly less than good enough on the features because distribution and bundling and packaging overpower a customer's desire to adopt a product so in the case of slack it was very difficult i think for us to compete against microsoft's bundling of teams with all this other software that they were selling and all the discounting that they could do made it very difficult for us to compete because we had a single product and lo and behold 18 months later the only real long-term protective solution for slack shareholders was to basically get bought by salesforce so that you could be part of a bigger hole this past week microsoft decided to go after notion and it's going to be i think a very similar story where you know once they decide to sort of go after this a product experience they only need to be eighty percent as good and then the distribution and bundling and packaging will take care of the other twenty percent it doesn't kill the other company but it creates headwinds that massive headwinds because because a company like notion cannot be fully valued over long periods of time simply being an smb company at a minimum you'll have to move into the mid-market you may necessarily never have to go to the enterprise but you probably have to go to the mid-market and in that is a very troublesome path because microsoft has so much you know uh so many tentacles inside of those businesses so anyways basically microsoft long google is a pretty obvious kind of like monopolistic you know pair trade the question is what do you short against it so that you can take up the market volatility and you can play spread again apple has severe you know headwinds with respect to inflation pressures um and margins and supply chain issues amazon has pretty meaningful headwinds now relative to uh pricing power and competition facebook has pressure with respect to regulatory oversight i just came up with one what about airbnb versus the airlines you're talking about small or rinky dink ideas well listen i'm not playing the same chip stack issue i wasn't there on tuesday night i'm on a thursday night so no no that'll be a good spread for me no that's a stupid idea and i'll tell you why okay if you're gonna put these things on go to where the deepest liquid markets are because those are the safest okay right like like don't try to be different being the same here tell me why airbnb which is a incredible margin business that's incredibly well run and growing versus airlines which are horribly run and low margin why wouldn't that be a good spread trade i'm just thinking i think it's a very very too you're picking two random companies out of a hat well no they're both in uh transportation and vacation and traffic they're completely different businesses with completely different motivations with different capital pools with different people that own the stock there's no point trying to get cute on these things my point is if you really want to be hedged against market risk got it go to where it's safest find the simplest most obvious thing don't overthink it or don't put it on so another obvious one here's here's so obvious is within big tech figure out which ones you want to be long which ones you want to be short that's a spread trade that over the next four or five years where if you expect a lot of market volatility it makes sense to maybe put some of this kind of stuff on right a different version of this idea which makes sense is in autos again trillions of dollars of market cap and you can make a decision do i want to be long tesla lucid and rivian and short the traditional autos that could be a trade you know but trying to like trying to go after like let me pick airbnb versus united airlines is too random for me and i don't think they're correlated enough for it to make any sense right speaking of the stock market uh saks um you've got the background of the new york stock exchange as your zoom background today what's that about yeah so bird listed on the new york stock exchange today this is a company that i've been involved in pretty much since the beginning we led the series a round back in 2017 it was actually the first check i wrote as a vc to lead around at kraft and four years later public company on the new york stock exchange is pretty amazing and so you're literally at the new york stock exchange we speak first remote bestie yes and you can see behind me um that is the floor of the new york stock exchange it's not like you know if you see the movie trading places it's not like that anymore there are no stock brokers there's no like paper flying around got it i'm not really sure what the purpose of all those monitors are down there it feels to me a little bit like a movie set yeah it's like a movie setting yes yeah and some people guys come here to record things but as we all know the all the trades are really happening inside giant machines can you turn around and just start yelling booyah and let's see if security comes and no i remember i'm in i'm i'm elevated above the floor no one could really hear me here i'm in like this sort of broadcast booth uh so take us behind the decision to go public as a four year old company we were expecting you know uh airbnb ubers and lyfts took over 10 years to go public now here we are sitting on a four-year-old public company is that a good thing a bad thing something in between and how does the board and the management team make that decision to go public i think it's a good thing um because the company well the company wanted to i think it had the opportunity to it um it grew very very quickly before covid then you had covid was like sort of a huge setback they i mean basically the scooter industry just stopped for at least six months because of lockdowns but then coming out of kova they bounced back really strongly they kind of pivoted their model to what's called a fleet manager model where basically they're putting a business in a box for a local operator a local entrepreneur to buy the scooters with financing and manage the fleet themselves so it's a much more highly virtualized model and so as a result of that in q2 they just did 60 million in revenue in the last quarter and i think it was a gross profit of something like 27 and uh it was had a loss of like 12 million so they're very very close to getting to profitability and uh you know the company's only four years old you know it took uber 12 years or whatever to get through public so it's been pretty it's been a pretty amazing ride there's been a lot of big ups and downs but uh so it's kind of a pretty sweet event what is it i know it was switchback was like the spat name right so it's it today was the first day it started trading under the ticker symbol brds i guess all birds took bi rd so we took brds and um you know if there's a total number of shares outstanding of i want to say roughly 300 million so it's about a 2.4 uh billion dollar market cap you know as it stands right now which you know for a series a investor is pretty great really happy for you sex yeah congratulations it's great congrats dude we heard last week sequoia is going to do the sequoia fund this evergreen fund keep owning shares now as a vc um do you distribute after four years of this investment and you made multiple investments or do you make the decision hey we think it's undervalued we have you know conviction in the company we were going to be in it for 10 years or do you just take the quick win and give everybody their shares well i've i'm gonna i've agreed to be on the board for the next year so you know i'm planning to do that and we have a traditional six month lockup and so at that point we'd have to make a decision about when or how much to distribute the shares and this is the first time we've been confronted with the decision i mean craft ventures is only a four-year-old firm and like i said this is actually the first round that i led as a vc so it's the first time we've been confronted with a distribution of this magnitude we've had some smaller distributions so yeah we still have to make those decisions we haven't decided yet what we're going to do if you if the stock is up let's say meaningfully in the next six months and you get to that you know six months and a day and you have the ability to distribute and it's up 25 and you're looking at it business is thriving you're on the board do you consider holding for a year or two so that you can distribute it at 16 25 or whatever your price target is maybe i mean we haven't we haven't gotten to that point yet so yeah i mean i guess what i would say is that our bias would be to distribute shares to our lps so that they can make their own decisions about whether to hold it or not um as long as we think the stock is you know priced fairly if for some reason we thought it wasn't then would there be an additional reason to hold on to it and make the distribution later chamoth what are your thoughts on this given it's come up before and a number of us are going to be faced with this decision and then we see sequoia has got lp buy-in for an evergreen fund well i think an evergreen fund is different from having to figure out how to do distributions so um they're they're solving for two different ideas the evergreen fund is really good because you don't have to do this continual fundraising process and you can basically roll gains back into the next tranche of invested companies in an easier way i like that idea it was pretty rare at the time i remember when i was starting social capital the only fund that did it really well was sutter hill um and for a whole host of reasons i decided to not do an evergreen fund in hindsight i think for me that turned out to be better because then it was easier for me to wind down and have a clear demarcation of when it was just myself and other lps versus when it was just my capital but there were some really good reasons to do it the hardest thing i think that sequoia is going to find in this new iteration is at some point somebody's reputation will be on the line for judging public equities and it's still not clear to me that people who live and breathe venture can context switch well enough to then live and breathe public equity so just the best example i would say is like tiger global when you look inside that organization which is incredibly well run there are two superb investors that carve the universe up right you have chase coleman that runs the public book and you have scott schleifer that runs a private book what does it prove to me it proves that it's just very hard to find a person that can do both and the context switching is very complicated so maybe sequoia finds an incredible public market strategist that can then manage these positions otherwise but they've done this for a few years right they've um sequoia i don't know people realize this they set up the heritage fund and they set it up with only gp's money it's got billions under management and it's been making late stage private but mostly public equity investing i know but that's a fun to fund what i'm saying is i'll be very honest with you if i was an lp of sequoia i would want the money back and the reason is i'm not sure that sequoia can compound money in the public markets anywhere near what i could so do you buy the point that they make that like exiting some of these left most of the you know kind of value creation on the table i think what they're saying something much more subtle which is they exited and they have regrets for selling you have to remember when sequoia distributed google every single partner got google shares now had they held those shares they wouldn't be saying any of this and famously i'll tell you when they held their shares i actually do fair enough but maybe they did maybe they didn't but let's just let's just put it out there that for example i know explicitly when i almost merged social capital with kleiner perkins like six years ago i spent so much time with john dore the most incredible thing that i was so impressed with dora was he was he told me he had never sold a single share of amazon that was distributed to him and he had only sold a handful of shares of google only to fund future capital requirements at kleiner at the time so i just think that ultimately i think probably what sequoia was saying is man i wish i had not sold my google shares when they were distributed to me because otherwise they wouldn't make that claim no i think what they're saying is more subtle i think they're saying you as our lps should have held them we are on the board of these companies from day one we have better insights in the second decade than in the first production board uh founder david friedberg how do you think about early exits distributing capital because you do have also with a startup studio structure which you should explain to the audience how a startup studio works because you create companies which is you know was a terrible place to be maybe five or ten years ago but it turns out you're in the best place because zero to one is where all the values created explain the two things what a startup studio is for people who don't know and then what's your view of selling early if a company of yours goes uh publicly i think there's a big um there's a bigger kind of framing here which is a lot of um investors you know professional money managers have tried to find ways to create what is called permanent capital which is a vehicle whereby they can continuously make investments decide when to sell those investments and recycle the capital into new investments with the idea being that over time they're not at risk of capital outflows meaning investors pull their money out and they're not at risk of uh you know needing to kind of go out and raise more money and they can they can share in the value creation as they grow their book value over time years ago a bunch of hedge funds set up public reinsurance companies dan loeb did this um uh what's his name einhorn did this blackman did it and basically bill ackman did it what they did is they set up a public company a new public company a reinsurer and then they used that that reinsurer to underwrite reinsurance and when you underwrite reinsurance you get all this capital that you can then go invest and then the hedge fund manage that investment and because it's actually a public company it's got a balance sheet the um the shareholders can't pull their money out right it's just got a balance sheet and the hedge fund was managing that balance sheet and you know generating good returns and this is effectively what warren buffett does and everyone looks to berkshire hathaway and warren buffett it's kind of the you know the the the key kind of long term here um which is uh hey look if you can keep investing and keep compounding value this thing can grow you know exponentially over time so you know the way we set up the production board i had the option of raising a fund and being a fund manager i chose to set up the production board because i was much more interested in i think the similar sort of vein of what sequoia is saying which is like how do you become a longer term uh builder and a longer term holder and where you don't have these incentives to return capital because you only get paid if and when you return capital and um you know and then you're kind of making these decisions to you know because your shareholders are saying well you had a good return quickly give me the shares back and let me and mark your profit and take your share and i was also more interested in look the fact is over time there's always going to be opportunities to chase with the capital so if we have a great gain if something works out really well we can take the the gain and we can reinvest that capital in building new things there's no shortage of opportunities to pursue for the rest of my life so that's why i set up the production board initially in partnership with alphabet and then later on we brought in you know bill gates and other allen and co and other kind of investors that have a similar sort of mindset which is like let's just if we have an exit recycle that capital and continuously they're not looking for a quick win they don't have pension payments to make right they don't have a reason to distribute cash and so same with me like i don't have a reason to take cash out so the objective was just build this thing over time and grow value over time and that's why i set it up the way i did and i think it allows us to make you know really long-term bets that are super risky most of what we're doing is super technical and and difficult and maybe very hard to pull off uh many of which are still after many years in a very early you need very patient capital patient capital and also the you know the preference for not trying to find exits but i have found this i'll tell you one thing i have been through a number of circumstances where i have seen businesses i've been an investor in or involved in that have traded long-term value for short-term opportunity meaning there's an opportunity to make a business that you can then go raise capital against you change your strategy to do that then you go raise vc funding and now the business looks like it's working but the 10x or 100x opportunity was taken off the table because you ended up going down this different path that was a sure thing that was more likely to work that created value in the short term that allowed you to mark up your investment or raise capital against that but you gave up the big long term thing and i think that's something i've been trying to avoid with the structure and it certainly makes sense with some of these other folks and what they're trying to do so what we're getting at here saks is decision making by capital allocators and on behalf of their lps or letting the lps make those decisions inevitably the crypto world says well why aren't you just doing this in a dow and you know having some decentralized authority make the decisions i had vanillin i've had a conversation with our friend vinnie lingam uh after the solana stuff and and multi-coin capital and we were talking about dows for early stage investing or syndicates and just brainstorming hey is there a way to do this and the problem i came to every time was should a bunch of folks be making decisions who are not meeting with the companies or meeting with 2000 companies a year what are your thoughts on a dao representing sort of what we collectively do but we all do it obviously in different flavors this actually exist yep well there have been dows that have existed to vote on buying nfts so yes for collectibles i mean i kind of feel like i'll let you know when it actually gets here so open-minded to it but who knows yeah but i mean we talk about these things as if they already are here and they're not quite here i mean technically i know they they exist but people haven't really figured out how to use them to you know to be a fund manager for example i think david's right i think the look i i there there are these three immutable features of web 3.0 that we're going to have to figure out over the next few years so the obvious ones are decentralization right that makes sense the second obvious one is the level of composability which means that you're plug and play with everything um but the third one is this idea of democratization and governance right and that's where dows come in and david's right we don't really know what the boundaries of that feature is i think it exists in some small level scale but we need to have many iterations of companies get built to figure out what it'll mean so i don't know i'm taking a pretty traditional approach jason which is that you know it's kind of like a crawl walk run strategy right now i'm in the crawling phase and i'm kind of saying how did web 1.0 and web 2.0 develop and i'm trying just copying it so you know in web 1.0 and 2.0 you needed companies like sun microsystems and cisco and you know all of the plumbers foundational stuff to build plumbing for the internet to allow the thousand flowers to bloom at the application level and you know we had a very good reference model by the way for web 1.0 for most people if you want to look at it it's called the osi reference stack and if you actually look at that osi stack you can translate that to all kinds of value creation over the first you know two arcs of the internet over 20 years trillions of dollars was created by just following each of those substrates um and in those transitional layers was where these great beautiful companies were built and i think similarly we're going to do that again but we need a different stack to represent what web pre is so yeah you know this week we did something which was pretty straightforward which was this idea that if you're going to build all these apps you're going to need a distributed compute infrastructure which means you're going to need very simple building blocks like remote procedure calls rpc that exists in web 2.0 it's kind of a not something you don't really think about but in web 3 doesn't exist and so it's all this aws you know gcp like infrastructure that has to get built and that's what syndicate does and i almost i think that's um a really very interesting uh observation there because everybody is trying to go to the application level and talk about the consumer experience but before you even have the ability you know we're talking about cars before we've even made a transmission or you know that's exactly right this is why crypto comes across as so delusional and strange sometimes they wrote 000 ico papers none of them were about infrastructure they were all about some sort of end game but the thing is it's a very delicate balancing act right you need a handful of companies that capture consumer imagination right that then incentivize all of the plumbing companies to come in and build underneath it right so it's a customer it's a very delicate balancing act right so you needed compuserve in order to enable a bunch of companies then you needed aol in order to enable another set then you needed yahoo then you needed google and in all of that what happened was people were pulled through right you needed amazon commerce to justify aws so we're in that world where it's going to be a little back and forth where the pendulum will swing back and forth between consumer experiences that capture imagination get to some level of scale that then create incentives for the developer ecosystem and the technology infrastructure to catch up uh zillow which we talked about previously became an eye buyer what's an eye buyer that means you buy a bunch of single family homes in all likelihood like open door and redfin have been doing and then you hope to flip them uh maybe improve them and uh maybe lower cost to the consumers by taking out real estate brokers this has created a lot of bad feelings amongst real estate brokers a tick tock video trended a couple of months ago where a broker said or accused zillow of buying up these homes in order to do price fixing and to corner the market on homes well uh it turns out that zillow which has an incredible ceo uh in rich barton and has done tremendously over the decades according ahead of their earnings call this week bloomberg reported zillow is trying to offload seven thousand seven thousand homes for 2.8 billion that's about a 400k average per home and zillow shares dropped 37 this week alone from 100 to 66. their market cap has dropped nine billion throughout the week uh and they're down 70 from a peak valuation of 48 billion just in february about six months ago zillow is going to reduce its workforce by 25 over the next few months i'm assuming that's all those eye buyers anecdotally a lot of what i'm hearing is they bought homes indiscriminately the anecdotal stories that are breaking on twitter and other forums with real estate brokers are they would look at a home they didn't know that it had a noisy neighbor or it was near power lines or whatever the people who came in bought them indiscriminately maybe too fast whereas some other companies maybe open door or redfin were more considered i actually had glenn from redfin on the pod not long ago and he said it's a very hard operational business you have to be very careful on what you buy in your entry price that seems to have turned out to be true what do you think friedrich rich barton who runs zillow is considered a legend in silicon valley you know he um uh has been involved in some of the most successful internet companies um and you know when he stepped back in as the founder of zillow stepped back in to run the business a few years ago it was viewed as kind of a second you know resurrection of this business and he was going to take it into new areas and then three and a half years ago he announced the cyber program which everyone thought was such a you know incredibly strong move and obviously chased open door which champ is involved in and i'm sure we'll share more on but it was such an obvious opportunity that if you could add liquidity to the real estate market the residential real estate market there's an incredible amount of value to be had now the way that they wrote about it when they talked about it initially and then the way that they've kind of talked about in their earnings report this week was that they were trying to be a quote market maker in the business and it turned out that what they were really doing was being more of a speculator right a market maker looks at bids and asks in the spread and then tries to to create a gap in that spread and make and take some share of it and by adding that liquidity the idea is the spreads can narrow and they can make money in this case they were looking at the historical velocity of selling prices of homes and using that as a way to kind of project what was going to happen which makes them much more of a speculator than a market maker and they clearly got this wrong and their kind of quote-unquote models on you know where prices headed ended up getting them in trouble there's also the inherent conflict where they are now competing in a way with the brokers that generate a lot of revenue for them and are a big part of their core business and they were clearly um you know cannibalizing their own business where the zestimate and some of the other scoring that they provide as a data and analytics platform to both sides of the existing market starts to get blown up because they're coming in and saying we're going to put our you know our foot down and say this is what the value is and it inevitably kind of cannibalizes the core product that they provide to both sides of the market so you know one could argue this was flawed from the beginning the execution clearly was way off and it begs the question you know where was leadership and kind of tracking what was going on here is these guys were buying homes at market prices that are well above what they were actually selling for in the market no one was actually doing on-the-ground work they were all doing kind of speculative models and saying this is what we think will happen and then they woke up way too late and um lost way too much money i think they lost 300 million dollars in the quarter so um you know really a lot of questions and a lot of challenges on this um i'm sure chemat has a point of view on you know what makes opendoor distinct from from zillow um but there's a really important kind of you know um underlying here you know yeah the maturity of a silicon valley uh entrepreneur who's crushed it so many times uh doesn't mean that they're perfect and you know this was a big mess you can go really too fast into a turn here and clearly they flip the car chamoth i i don't know how comfortable you are talking about this interesting very comfortable okay well then here we go number one you know i'm not on the board um of open door of open door maybe tell us about your history with open door chim off would be super look i look i am one of the largest individual shareholders of that company i think somewhere between three and four percent of the business i own we you know i came to own those shares with a large investment uh as well as through the transaction uh where we merged one of our specs into it and took it out ipob yes couple things to say the first is about the ceo and founder of opendoor eric wu is special special special so let me just leave it at that on that topic the second is i think that rich barton is very special but it speaks to two big mistakes that zillow made the first is that catching a wave of disruption is very difficult when you have an old line business that is fundamentally competitive with the new line of business and zillow as david said had this thing called zestimate whose entire job was to directionally drive top of funnel traffic into the rest of their media business now imagine you go to a website to look up your house value or somebody else's house value accuracy is a bug the feature that makes this estimate work is a highly inflated house price right like if you go and you see a crazy house price number that's interesting that's more um click-worthy than if you go in there and it shows some depressed value you think the sight sucks that's the unfortunate psychological reaction so i think whether we believe it or not or whether zillow knew it or not zestimate over time basically calcified this idea of price inflation so the accuracy was never a goal so then if you take that business and then you try to orient it towards home buying and you use probably zestimate or some version of it to underpin how you buy and take risk it creates a lot of risk and i think this is essentially what played out where they were over buying homes and they didn't know how to price this stuff accurately so you know my partner ravi tweeted this out but you know uh the open door margin on average is about ten percent the zillow margin on average was three percent so they had a much more razor thin margin of safety here which again speaks to pricing and then it speaks to this third thing which is that if you start doing one thing and do it really well with software the gains over years really compound and so when somebody else shows up and tries to pivot their business to try to copy it it's very very difficult the classic example is google versus yahoo yahoo had a beautiful directory driven business but when larry and sergey really larry invented pagerank and then invented that first version of a google search index as we saw it play out over the next 10 or 15 years it was impossible for yahoo to really invest the technology the technical capital necessary to catch up with google and every day and every week and every year as friedrich talked about last week those technical gains compound and compounded now google is completely unassailable with respect to search i suspect we will look back and the ability to accurately forecast price and volatility and the ability to sell these assets at a defined margin of safety in a predictable way is something software can solve and it seems that open door is the first it doesn't necessarily mean it'll be the only one but it has an enormous head start now and as long as they can keep iterating those gains will compound um so that's what i think i just think this is a wonderful business run by an incredible ceo to wrap up this uh zillow story saks uh any thoughts on you know jamaat's point here you know you're the rating agency and you add this business and the business it might be orthogonal to the existing money printing machine on a strategic basis what do you think any lessons or mistakes here uh in terms of when you handicap zillow or do you want to just move on to truck politics i mean look i'm a i was a c investor in open door because rabbi invited me to the seed round so you know i'm a little biased here but i think it's pretty obvious what happened zillow tried to copy them the business is much more operationally complicated than they realized it's a low business low margin business with the which requires a ton of capital so if you're off a little bit the losses can be huge and zillow couldn't figure it out they underestimate the difficulty that's what frequently happens when a big company tries to copy a smaller sort of upstart company so i mean that to me is what happened in a nutshell quite frankly we're an hour into this pod we haven't discussed issues any issue that i think is broadly relevant to most americans i think this is one of our worst episodes we're going to bore everyone to tears i frankly don't understand what the [ __ ] you're doing i don't even know why we have a topic list when you start pulling it out of your ass like dolls and i don't know what the [ __ ] else all right all right fine we'll talk about politics i thought the dow question sucked all right i'm just giving you the opportunity that we shouldn't even be talking about cut it out of the show this whole episode should be cut jesus christ episodes yeah i agree i think we should cut all that it's going great what do you know jason jason i agree that that part where we cut it that's all right fine you got some [ __ ] loser i'm trying to give you guys the benefit of the doubt to just because it was like no one cares all right fight calm down everybody you want to talk about politics we talk about politics okay saks go ahead tell us about the election okay i'll just rattle off some of the key results here from blue states we have a woke lash going on all across the country that's the important thing in virginia a state that biden one by ten he's cranking a huge upset republican glenn younkin beat terry mcauliffe a former governor there he was this was a huge upset mcauliffe was supposed to win younkin won 51-48 so that's a 13 point swing uh versus where biden was just a year ago in new jersey a state that biden won by 16 points the democrat held on to it but only by 1.5 points and i bet you anything the rnc is kicking itself they didn't give any money to chaturelli who's the challenger who i think almost became very very close and there were down ticket seats that went republican so the the um this is really interesting in south jersey which is a blue-collar bastion for democrats sweeney versus burr that's right the democratic state senate leader steve sweeney lost to a truck driver named ed durr who spent a grand total of 153 dollars on his campaign okay so those were some and then we had someone say write in like he was printing on others to say write me in i think i don't think he's a writer but but any event so so implications for 2022 dave wasserman of cook political report calculates somewhere between a 44 and 51 c game from the gop they only need five seats to win the majority so it's looking very bleak for the democrats in 2022 and then i think you also had some very interesting local elections in minneapolis voters rejected a proposal to defund the police with 56 percent of the vote uh they there was a ballot proposition to change the police department into some sort of larger public safety group voters were having none of it in seattle which is a very liberal city they voted for a literal republican as city attorney which is the office that prosecutes misdemeanors so against a police abolitionist who said she would stop prosecuting misdemeanors you're forgetting that in virginia it wasn't just glenn younkin that won but basically it was terry mcauliffe and then a lieutenant governor who is some milk toast individual and an attorney general candidate who was caught in blackface which by the way there is no more racist thing you can do just to let you guys let everybody in all the non-colors okay that guys please don't do blackface or brown face it's such a bad it's it's not it's not you're right it was a sweep so the lieutenant and junkin and it was a it was a black female lieutenant governor and a latino attorney general that's right and they swept right so that's right that's right so the lieutenant governor was winston sears uh she's a a black woman republican if you've seen the photo of her she's frequently photographed with a giant assault rifle in her hands uh that's her and then the hispanic attorney general jason miyari's uh one as well so yeah it was a huge sweep and then you know in long island and staten island which again are blue counties you had two republican prosecutors beat the local sort of incumbent democrat decarceration rad just i think i think this is very clear which is um trump was behaviorally extreme and after four years people were sick of it nobody wanted that behavioral extremism because it was unpredictable and people felt frankly in danger and i think that that was legitimate he also turned out to be extremely lazy and probably pretty dumb now what we're realizing is the different form of extremism which is policy extremism will also be met with the same response which is that you you can't sustain election results and wins right so people care consistently about three things they care about the economy they care about the education of their children and they care about safety and the thing that glenn younkin did which i thought was at least a playbook for centrists and the right and it's also a playbook for the democrats if they choose to embrace it is to understand that these things are reaching a tipping point where you know again we've said this before it is possible to live in a state of mind where you believe in black lives matter and you believe in law and order right and and when you try to pit those two things against each other for example like you would have thought the one place where they would have basically defunded the police in its entirety would have been minneapolis after george floyd but instead even they drew the line and said no or new york or new york there was a there was a really compelling quote actually by this woman i think it was in the new york times um and what she said was i didn't elect joe biden to be fdr i elected him to tack to the middle and just calm things down so that everybody could exhale so that we could reset same with me and what's up that was abigail spamberger actually she's a virginia democrat yeah she's a virginia democrat who won a seat in one of those blue counties that just flipped red to vote for yunkan and since she got elected i guess she got elected last year she's been telling the democratic party she's the one who called out pelosi in that you know caucus meeting saying i don't ever want to hear the words defund the police again that is electoral poison and then she said yes nobody elected biden to be fdr they elect him to be normal and stop the chaos and so certainly my vote yeah yeah there's a big backlash going on because biden has decided to start governing like bernie sanders no one elected him to do that so sax is the lesson dems learned this time around is it's very easy to beat trump but it's very hard to beat a moderate republican no no it's not that it's that you just have to be a rational normal person that's what i mean by a moderate republican well you just have to be moderate i don't think it matters when this is but this is the key to the condems it was so easy for them to use trump you know but these three topics are not a republican tent pole nor are they a democratic temple they are the tentpole of reasonable people yes meaning which most people are reasonable hey guys get out of the way so that we can you know have a reasonable life in an economy hey folks please make sure my kids when i send them to school for eight hours a day come back reasonably educated and please keep my streets safe and i'm not really willing to decarcerate ad hoc to such a degree that all of a sudden crime gets out of control those are not democratic or republican tent poles those are just moderate centrist rational things to believe in yeah being and also behave normally like i i think whatever happened with these progresses where they couldn't pass you know the stimulus bills and things that almost everybody agreed on glenn younkin was not behaviorally extremist yes and and from a policy perspective was pretty much down the middle eric adams eric adams is not behaviorally extreme and he is politically down the middle the mayor of buffalo who got reelected is not behaviorally extreme and he's politically down the middle do you start to see a pattern here yeah nobody wants aoc bernie elizabeth warren or trump i think it's not it's not a question of aoc or bernie or trump it's just that right now the temperature of america is let's just all exhale and just re-center ourselves as a country yeah and so moderation and centrism is actually what calls for today i don't know how to predict what happens in 15 or 20 years and maybe aoc is the canary in the coal mine for where the country goes by a plurality of people in 15 or 20 years but what's clear is it's not where it goes today and i think that we it all behooves us to just take a real step back and exhale and just read the tea leaves because every single thing that the democrats tried to do to sort of like make this extreme really didn't work the race-baiting all of that stuff really kind of failed and i think that that's important to listen to you know because you had a lot of black indian chinese families that just showed up hispanics you know that again reliable democratic voters and voted for glenn younkin in a way that was surprising to me right and then so if you compare new jersey and and um virginia biden won virginia by 10. he the the democratic nominee lost biden won new jersey by 16 and phil murphy barely sweeped by it was like 10 000 votes here she's always had a a republican kind of uh leaning group uh they're very uh tuned in one by 16. this should have been a cakewalk yeah but i think that's 16 how much of that is get trump out of office is what we i think the democrats need to parse we're repudiating behavioral extremism and policy extremism so i think we just need to realize rational normal chill people who can do reasonable things get our kids educated so for example on the education front i don't know if you guys saw this because i tweeted and you can put this nick in the group chat but in california right now there's a battle over math class ridiculous right where the title i'm just going to read the title because it sets it up california tries to close the gap in math but sets off a backlash proposed guidelines in the state would de-emphasize calculus reject the idea that some children are naturally gifted and build a connection to social justice critics say math shouldn't be political well of course the way that those articles are always written it's always about the backlash you know they don't talk about what what the people in charge are trying to do to basically degrade the curriculum of course there's a backlash because parents don't like what the people on these school boards are doing this was the sleeper issue in virginia was the school board issue you had you know parents were already angry that the teachers unions had kept the schools close for a year and a half during covet and while their kids were at home you know work doing classes over zoom parents got a good look at what some of their kids were learning and then like what they saw i mean we're talking about lessons plans that incorporated crt and you know the 16-19 project view of america singling out kids by their race making them focus on difference and then there were some you know rather explicit materials at young grade levels about you know lgbt issues and so this led to a whole bunch of confrontations that school board memes were parents of all races objected to you know the lease lesson plans for for their kids and the school boards and administrators just dismissed their complaints out of hand and you know their message was we're not teaching cr teacher kids uh but if we were it's a good thing and only white supremacists would object so you know that was sort of what was happening in the background and then mcauliffe comes along and makes this gigantic gaffe in the last debates about two weeks before the election where he says i don't think parents should be telling the schools what to teach and what yes this is the customer no he said that he said that on a debate and he said that debate about two weeks for the election mcauliffe was leading through this whole thing until that debate where and this was sort of a kinsley gaffe in the sense that you know michael kinsley set a gaffe is when a candidate inadvertently uh says something true you know this is mccalla's view is that the teachers union should be controlling the schools not the parents well um yes so this is what yanking uh jumped all over all of his ads in the last weeks of the campaign really focused on this issue you know poured gasoline on a fire and then the most tone-deaf thing mcauliffe did is he had randy weingarten who was the head of the the big teachers union come in and campaign for him at the 11th hour well of course that's not going to save him because people are sick and tired of the teachers unions so you know this was basically the big sleeper issue crt and the schools in virginia and you know this is this i think specifically is what the democratic party has to wake up to is that these progressive ideologies are not popular the other thing i'll say about glen yonkin is that this is another thing that the that the republicans should hopefully pay attention to which is you can look normal act normal be normal you know this is not an extremist in any way this guy was the co-ceo of carlisle which is a huge and very successful private equity firm so this is a very rational reasonable person who um you know didn't embrace anything that was really that pro-trump and that should be a real wake-up call to the republicans which is hey let's just run a fleet of normal people i think what you saw i think chamath is right that what you saw in virginia is that the playbook that gavin newsom just used to defeat the recall in california did not work in virginia which is he tried to paint yunkan as a trump proxy and young can very definitely you know avoided that he got trump's yes he got trump's endorsement but very early in the process he did not have trump come to the state um and you'd have to say it also helped younken a lot that social media that trump wasn't all over social media because he's been banned so you know in a weird way facebook and twitter deserve an assist here because they help keep trump out of the virginia race so you know this playbook that that newsom defined that would work very effectively from california which is simply to keep running against trump i think democrats thought they'd be able to win elections for years based on that that playbook didn't even last two months so you know so i think democrats are gonna have to find a new playbook here okay so friedberg on this california issue around education one of the key or most controversial concepts is detracting in other words instead of having high performing students go to a high performing track and then everybody else stay behind maybe keep in not all cases but keep some of the students together because there is some research that shows if done right if you track people together the higher performing students will pull up the ones who are slightly behind other people say we're basically uh throttling people who could be the next einstein or the next world-class leader in science math etc uh any thoughts on the concept of detracting since i'm assuming you were in the high-speed track in science and math maybe we should get rid of like jv and varsity sports teams as well and you know triple a baseball and major league baseball as well and you know any distinction of performance um or exceptionalism goes away you know and and that is kind of the the key social question is are we going to give up exceptionalism um to minimize uh the distance uh between the exception on the average and that seems to me if it makes people it makes people feel bad but i've said this point before you know we're doing it when we try and think about you know the billionaire attacks or what have you as soon as you start to limit progress um you reduce inequality but you limit progress and the same will be true not just in science not just in business uh but also in sports and athletics and um and any other kind of system where you will have exceptionalism you will have an average you will have a distribution amongst human performance and as soon as we try and limit the difference in that distribution um we move the entire curve to the left here's the uh counterfeit bird what some studies have shown is yes you will uh throttle the high performers but we're seeing uh along race lines certain demographics being left behind other ones excelling and that you can get yeah it's an ethics and values question right like do you think that individual freedom and the opportunity to pursue your opportunity your your exceptionalism um should be taken away from you such that others who aren't as exceptional as you are given um you know greater progress than they would have had on their own um and that's the key crux of what all of these social systems are grappling with whether it's in sports or business or finance or or um or education is what's the right thing to do and that ethics question is going to be defined by the social agenda of the moment and you know the means of the moment and what we all think is is the right thing to do and it's different all over the world and it's different within political systems but it's a very divisive point that i think folks who find themselves on one end of that exceptional spectrum in different aspects are going to have one point of view and folks on the other end of that exceptional spectrum are going to have other points of view and everyone's going to be sensitively tuned to where they fall in that spectrum i will say one thing though on that spectrum exceptionalism is rarer than the average therefore it is likely the case that over the next years and decades we will see the um the idea that we should remove exceptionalism in business and exceptionalism and education and exceptionalism in sports because it benefits the majority and um and no one kind of recognizes and a lot of folks don't recognize the progress that is made by exceptionalism and um and that's and then we're gonna wake up one day and be like oh wait a second we don't have the the best sports teams winning all the gold medals we don't have the smartest kids we don't have the best businesses china and europe and brazil and whoever else the emerging markets are gonna india are gonna start to have them such a good point i think this is a very old debate it's the debate between a quality of opportunity and a quality of results yeah and the progressive left is absolutely obsessed with a quality of results or outcomes which they now call equity which is we're going to take people at the finish line and we're going to move them around we're going to redistribute the outcomes to achieve a more proportional representation or something more fair as opposed to giving everybody as much opportunity at the outset as possible that is the fixation right now that is why they're taking out advanced math in the schools they're trying to level people it's not going to work it doesn't lead to a more we want to have an exceptional society where i think we should be focusing is creating as much opportunity for everybody the way to do that would be to let every child go to the school of their choosing so that we would stop trapping kids in bad schools but back to kind of to bring this back to the election for a second because i think it was a very clear repudiation of this progressive mindset and i think there's essentially two sets of reactions to it if you look at sort of all the left-wing commentators the the one who i thought seemed to get it the most was cnn's uh van jones actually had i thought you know a rare moment of introspection where he said this was the the results were a five alarm fire he said it was a big big wake-up call for the democrats to stop annoying voters with woke hectoring um he actually advised biden to start triangulating against awoke left in the way that bill clinton did i mean which is something that i've been suggesting on this pod so you're saying something super important the game theory now is for biden to put to the test the progressive left because now he can go firmly to the center and he can put all of the pressure on the progressive left in the house and uh warren and bernie sanders in the senate well he's right that's the first thing he should do is he should he should pull a sister soldier on bernie sanders he can't keep delegating the domestic agenda to bernie sanders he if he wants to save his presidency he'll start triangulating in the way that bill clinton did i'm not sure he's going to i think there's already a misperception that the reason why they lost selection is because they didn't deliver the goodies in this house reconciliation bill um that in other words i don't think the public cares about the goodies i mean they care about this normalcy and centrism yeah there there's a part of the democratic base that does want the what's in that house reconciliation bill but but here's the thing democratic turnout in this election was extremely high the democratic turnout for mcauliffe was higher than the democratic turnout four years ago for the democrat who won the turnout that in new jersey was higher than what murphy got four years ago when he won the problem that democrats have is that republican turnout was extremely high even without trump showing that trump doesn't matter that much to turn out and the independence came out in a big way for republicans so this idea that democrats can just win elections by delivering you know programs for their base that's not going to work so i think that's a misperception i think van jones has the right idea they need to triangulate but you turn the channel to msnbc and they were just blaming the whole thing on white supremacy basically hysterical um just on the de-tracking thing this shows to me a severe lack of creativity you if you look at what happened in the nba they had this developmental league which they didn't kind of run then became the g league they now have the ability to bring players fluidly from the warriors g league team up to the warriors or the next team up to the knicks what this means is you don't have to say there's two different tracks and the the two never shall meet in the season they can move up and down in math a very easy solution to this would be to have the high track for high performers have the regular track and then spend with all this money we have say hey every school is going to be open from three to five o'clock four days a week if anybody wants to attempt to get into a higher track of math just stay after school for two hours anybody can go and get one-on-one tutoring and just don't change the number of teachers the whole country wants excellence they don't want leveling they don't want equity they don't want a quality of results they want to have a quality volunteer david wants people to move up they do want to see that's true and brown students and immigrants do better at math that's what you're missing yes and that's about a quality of opportunity absolutely no it's not just about equal opportunity they're so far behind statistically that you need to do something new what we're doing is not working david that's why people are picking this bad they're they are eliminating advanced math because they don't want to actually look at the the problem what do you see the problem is well if there's another performance a certain group then you should work harder to raise them up not eliminated give me a suggestion it's charters and school choice okay look i mean if you're if you if you're gonna define structural racism as conditions that that trap people of color in poverty across generations seems like a pretty fair definition then you have to say the number one cause of structural racism is the school system school system education yeah it's the school system because we know poor kids are trapped in schools that aren't very good why because they're controlled by the education unions they don't have your choices so who is making that argument uh on the on the side of the left no one why because everyone knows the unions especially the education unions are the number one donor to the democratic party so the democrats won't even look at this problem although this is the way white supremacy could build their base is by saying we want to fix education that would be if you've seen education what do you think young industry in virginia by the way 55 of hispanics in virginia voted for yunkan so minorities are shifting on this issue and school choices these are the new quality of life issues if yunkan has a a good four years in virginia he can run for president and crush this thing can i show you just one one chart and then we can get off the politics thing which is it was this chart from this guy patrick uh raffini who's a pollster and i think it really illustrates the problem that progresses the democratic party for the listener okay so what this chart shows is it basically shows where the democratic the democratic party is and the senate republican party is in relation to the center of the country okay and basically as you'd expect in a democracy whichever party is closer to five wins okay so in 1994 when bill clinton was president the democratic party the center of it was smack dab as five the republicans weren't that far away they were six so the party even though there is a lot of partisan warfare the the political differences actually weren't that great and clinton i think more accurately found that dead center okay fast forward to 2004. so george w bush is president now the democrats are at four republicans are at five that's why republicans won okay now go to 2017 these poll numbers he did and this is a few years ago the democrats are all the way at two okay and the republicans are at six and a half so it's true that both parties have moved away from the center but republicans are one and a half points away from the center whereas democrats are three points away so the democrats have actually moved further away from the center if you look at who are the activists in the democratic party who is the base who is the energy who does all the work who does the contributions it is the progressives right this is why mcauliffe ran as mcauliffe is not a progressive he was the clinton democrat you know going way back to the 90s okay he was bill clinton's you know uh right-hand man in the party back in the 90s but he nevertheless ran as a progressive in virginia who supported the teachers unions why because he was appealing to the base of the party gavin newsom did the same thing in california gavin was never a bernie bro i mean he's always been liberal but he he has moved very far left and biden has moved very far left as president why is that because the base of the party has moved very far left so unless that gets fixed i see maybe it's going to the party's base but not the countries exactly so you're going to need a strong democrat who can basically give the heisman to that part of the base or they're going to keep losing elections i think this could be a republican decade i know it doesn't seem like it right now because you had trump and the republicans lost but look how quickly the republicans turned around their electoral fortunes so with trump on the sidelines then that's just a huge trump is the nominee in 2024 all bets are off but in 2022 he's not the nominee he's still censored from social media he's really nowhere in sight and people people have a very short um memory it turns out they've moved on very quickly young can check the box because he felt he had to to get the nomination and to run on the republican platform but then you think yunkan's going to talk to trump once no not once and i think and i honestly think this election is going to help republicans move past trump because what republican believes in um in like that the electoral system is rigged now right i mean all these blue cities and states just delivered big results for republicans so where exactly is the ballot stuffing where exactly is the stall where are the stolen elections that's going to that's going to stop now too they're going to stop it's going to stop overnight right because i mean by the way kristen cinema probably knows this like you know the the the funny thing about all of this is when peter thiel put in 10 million dollars into this pack for blake masters who used to work for him and said you know in arizona i'm going to run this guy against you cinema attacked heart to the center instantly so she she knew too yeah well so so just this small point of course so blake is running against uh the other guy um the astronaut guy i'm spacing on his name but but yeah but but cinema is up so to speak uh in the next election cycle so she got a little bit more time but you're right like cinema is attuned and mansion is attuned there are some of the few democrats that are attuned to where the center of the country is you heard a mansion in the wake of this election said this is a center-right country these guys better wake up um you know they should really now look i think i think what's going to happen in the wake of this election is that this infrastructure bill is going to sail through because one of the crazier things that the progressives were doing was holding that bill hostage it might have helped mcauliffe i don't think would a i don't think mcauliffe would have won but it might have helped him by a point or two if they had gotten that infrastructure bill done because a lot of those programs are going to be popular in a state like virginia okay but i mean but but i think that you know this house reconciliation bill they just seemed hell-bent on jamming it through with all these tax increases i don't think that's not popular you know what the big issue in new jersey is for them yeah one of the big issues in new jersey where you almost had this upset within one point was taxes you know um there was a a gaffe by murphy who said something like you know he said he said that if if taxes are someone's chief concern he said quote maybe we're not your state can you imagine that wow and he almost lost the election because of that so i don't think all these big tax increases are what the country wants and you know if biden insists on allowing bernie to dominate the agenda and warren i think it's gonna you're gonna see 40 to 50 seat losses by the democrats in 2022 okay moving on to our final topic crazy update out of china a research team has developed a method of converting carbon dioxide into starch science magazine published this paper from a research team 100 grams of catalysts converting 5 grams of co2 per hour into starch and freeberg i'm sure you tweeted that this is 10 times more efficient than corn plants uh what's the impact of something like this could it hit scale would it have an impact on food security carbon global warming yeah so i tweeted this paper app because it's just it's a fantastic demonstration of what's possible in this new emerging not emerging it's been around for a long time but kind of you know in the state of art in um in biomanufacturing you know photosynthesis is the system by which most starch is produced on planet earth today that is plants convert sunlight and use water and carbon dioxide to make uh starches and starches um and sugars which are what carbohydrates are account for 60 of human calories and we get all those calories from rice wheat potatoes which you know are grown on about 60 of our acres uh that we farm on planet earth so you know in in plants there's a series of these chemical reactions and what these guys did is they um isolated and created a couple of specific proteins um which are a class of proteins called enzymes and what an enzyme is is it's a protein that can take different molecules and combine them and re enforce them to react and make something new and they identified a couple of enzymes and engineered a few enzymes and put them together in a cell-free system meaning there's no cells involved it's just a tank with a bunch of fluids in it and and they stick in some carbon dioxide that they can suck in from the atmosphere and they um they can and they have to drive it with some hydrogen gas which we can just get from water and the system basically converts that carbon dioxide into starch which is uh being done at a rate that's almost 10 times higher than what we see with with corn plants so it's it's an incredible demonstration there's there's several steps to this system like six steps and i did some back of the envelope math and my back of the envelope math on what they've demonstrated and by the way everything they did is publicly available for reproducibility so people are going to try and resource open source so people going to try and copy this now but my back of the envelope math is um you know this system can produce about 10 grams of starch per liter per day which would mean it would take about 2.7 trillion liters to suck up all of the carbon dioxide that all of humans are putting in the atmosphere every year from all of industry that would require um about 27 million tanks that are about 40 feet tall and about 8 feet wide that whole all of those tanks could fit in an area about 25 by 25 miles you could attach one nuclear reactor to it to suck up the uh the water and convert it into hydrogen gas and feed the system and those tanks 25 miles by 25 miles would take out all of the carbon dioxide on planet earth and convert it into usable starch and that starts by the way that system could be tuned not just to make starch for consumption it could be used to make biofuels it could be used to make bioplastics it could be used to make anything that's hydrocarbon-based um and so you can kind of think about this being the entry point to a series of production systems that we could use to make stuff why freeberg why did they open-source it so they're a research team of scientists from china and they've been iterating on this this process this isn't the only process right and so what they're showing is that this is possible and what i think we will see is a lot of people rattling their brains now saying not only do we use proteins and enzymes that we find in nature but we're going to start to engineer our own proteins and our own enzymes that are even more efficient than what we see in nature and that's what's starting to happen this system alone what i just described this 25 mile by 25 mile system which is tiny is the equivalent of starch production from 42 u.s corn belts if you took all the corn growing in the united states it's 42 times that um is what it would produce that's my back of the envelope map of kind of what these guys did um and so i think what they're showing is this is what's incredibly yeah yeah and and the implications we could go in 100 directions and we could talk for an hour about what this means and what you could do with it but i think it it really catalyzes this point that that that we're kind of everyone's always like how are we going to get all this carbon out of the atmosphere what are we going to do with this where there's a will there's a way the science is here today 27 million tanks made out of plastic you could probably get that stuff produced you know a couple billion dollars find a piece of land that's 25 by 25 miles it's near some water and put a nuclear power plant there and you could suck up all the co2 in the atmosphere anybody want to take anyone would want to take a guess of how many people on the team were in advanced math courses the funny thing about this that i think is really interesting is that it came at the same week where we were ending you know what was this political theater of cop 26. you know greta thundberg uh who's you know how dare you how dare you she had this very funny comment which is like uh you know it was a bunch of corporate nonsense and the same old blah blah blah what's your description of cop 26. you know we had this great trickle of like you know agreements there was like on monday there was an agreement to stop deforestation uh and then you realized it's a non-binding agreement and you're like oh okay well i guess we're not gonna stop deforesting we're just gonna keep you know doing that and all of this stuff just kind of like took a lot of my enthusiasm um and i was a little despondent about what was going on and then when i saw this thing i was i was really quite impressed i will say that there's a very tricky thing happening right now which is that developing countries basically said listen if you want us to go after climate change um we want 1.3 trillion dollars in here to support us and so you know the western world will have to figure out whether we're willing to pay you know what is the equivalent of you know six or seven percent of us gdp to a whole bunch of other countries every year for them to slow down and if we don't make these payments to india and china and a bunch of other developing nations they they have said we're just going to continue to do what we're going at here's an idea take half of that money and put it towards science yeah take half that money and go build a plant that uses this system that was just demonstrated and put it in south texas and suck up ocean water and convert that ocean water into hydrogen gas by the way ocean water can be turned into hydrogen gas by running electricity through it so you're putting a nuclear power plant to make the electricity you run it through ocean water you create hydrogen gas you pump it into these friggin tanks and it sucks up all the co2 and it makes stuff that humans can consume and that we can use and suddenly you have this abundance of material you have this abundance of food and you can turn this in jobs and you can turn this into a lot of different things and you know this kind of goes to the point i've been making for a while if we want to invest in infrastructure this is the sort of thing that both solves climate change creates jobs and has extraordinary economic return potential built into it so how do you get politicians re-elected you know i think the private market may come after this stuff i'll be honest i'm you know i'm like i'm talking to people looking at this being like why don't we make a plant that we can make biofuels and bioplastics and food and other stuff out of this this technique and there's going to be other iterations of this technique um but it's such a no-brainer cost like a functional prototype of this like a small prototype nothing right i mean couple million bucks yeah like nothing so um you know the other thing that happened this week beyond this request for 1.3 trillion dollars is that you know we're now seriously considering carbon tariffs and we talked about this on a pod before but you know i've said i think this is the most disruptive thing in the capital markets and and geopolitics that can happen in the next 10 or 20 years is an effective carbon tariff which is to say that when a good or service enters the borders of a country they will levy some tax that they think represents its drag on the environment and so you know the simple example would be a car you know you make a car you make a tesla in texas but the minute it crosses the border to canada canada says well here's the true carbon intensity of this car all of the energy that you put into the aluminum to the batteries you know to the to the buildings where the engineers sat that were that were building fsd and uh you know i'm gonna charge an eight thousand dollar tax on this car or iphones coming out of china yeah that's happening i think that's coming so i think that you know the combination of tariffs and these transfer payments is going to create a real economic incentive for folks to make these kinds of big technological leaps so i'm pretty bullish on all of that i'm less bullish on politicians ability to organize because unfortunately again this is the first time i really paid attention to cop and it just looked like a bunch of really you know useless political theater it's just a lot of political theater saks does this uh science conversation about saving the planet do anything for you would you like to get back i mean i think it's the way to solve the problem is you have to figure out new technologies to actually take carbon out of the atmosphere because you're not going to do it through you know these political programs i mean you know china india paying them and and other developing nations 1.3 trillion a year i mean foreign aid already is one of the least popular parts of of the uh government's budget you're going to now pay 1.3 trillion to these countries so that they it's nonsense and you're gonna pay put that money into our education system nobody's creating science and technology that solves the problem nobody's gonna stand for that yeah and you know the the the tactical education system right pour it in yeah i don't think there's a political solution to this problem that's gonna be palatable to people i think it's gonna have to be solved through new technology now let me ask you a question freeburg you said there's a six step process given your experience building science and technology products is it possible for each of those six steps to get but 20 percent more efficient a year yeah look i mean um i just say that to describe that there's a series of steps in the system it you know um but uh at the end of the day this is a demonstration of science that has been you know probably funded to some small amount but you know if you start to iterate on this approach and think big picture and think infrastructure solution here uh there's a lot of room for improvement i'm sure so in other words you're back of the envelope 25 by 25 mile if this is getting 50 more efficient 25 more efficient year over year we could see it becoming you know uh twice as efficient every two to three years and your 25 mile might be a five mile radius city i mean think about going to mars right what are we going to do in mars we're not going to grow friggin fields of corn and grow cows and stuff right you're going to need a system that literally takes the molecules that are in the atmosphere there uses some electricity that's probably going to be produced by a nuclear power plant and convert those molecules into what you want to make and consume and that's what we can do on earth today the systems are going to get better they're going to get cheaper they're going to get faster and that's why i'm highly optimistic about solutions to climate change in the century it's not about an if it's about a when and you know the when is going to be defined by the willpower of how we are going to allocate our people and our capital resources to solve these problems and then your term we have the tools to do it i love the fact that we're sort of hitting this fork in the road where it's like do we just want to give the money to a bunch of governments to pretend they're going to solve this and grifters or do we want to put it into science technology innovation and entrepreneurial entrepreneurship that execute execute right yeah let's give it to politicians who don't know what the [ __ ] they're doing i mean it really is like when you know i don't know if you saw elon say like yeah if you want to solve world hunger can you make us can you oh my god let's talk about that that's just so beautiful i thought that was like the greatest that's dunk of the week nothing nothing gets me up in the morning like funding shenanigans right go ahead jake out tell the stories i mean just somebody was like oh elon you know made more money tesla stocks no not an article it was an article that was written sure and then he's like well if you want to solve world hunger i'm willing to sell sheriff jason can you describe it you're doing such a shitty job today as a moderator what are you talking about all i did was put a sis in your hands you guys dunked everything but dude yeah uh hey guys and there was an article there was an article that was written that basically said you know um you know 6.8 billion dollars uh which is you know what elon made like in a day or something could cure world hunger and then the head of the you know uh un world food program retweeted that again trying to further dunk on elon and then um elon responded well if you can just show me a plan and just please reply online here on twitter and it's credible and detailed i'll just sell this talk and i'll give it to you and uh everybody was like oh my god there was this oh my god moment like wow can this really happen ending world hunger sounds like a beautiful idea it can only only cost you know 6.8 billion dollars and obviously it went nowhere because the guy didn't have a plan and it was just a complete joke but that's what happened yeah and he's like yeah just put all of your uh put all of your expenses out there show us your plan and it was like oh crickets nothing all right everybody on behalf of the dictator chamoth paulie hoppetea the queen of quinoa the sultan of science david friedberg and for the rain man himself reporting from definitely reporting from yeah he's reporting from the new york stock exchange congratulations again my bestie david sacks on the triumphant ipl of bird we'll see you all next time on the allman podcast bye bye and they've just gone crazy with it oh we should all just get a room and just have one big huge orgy because they're all just useless it's like this like sexual tension that they just need to release your feet we need to get back










he's a robot don't quit your day job jamath that's all i can say bro you don't remember baby shark i mean how many no he doesn't know his kids first names for birthdays how does he know baby sharks ride [Music] [Music] hey everybody welcome to episode 55 of the all in podcast with us again this week the dictator himself jamal paulie hoppetea the queen of quinoa david friedberg and coming back from portugal and the solana conference riding his where heroin and prostitution are legal david said we were gonna we were gonna double click on that but you jumped the gun here on the docket so david how was the heroin in portugal great great okay there you have it folks i was i was fully drinking the kool-aid at the salana conference it wasn't heroin it was kool-aid it was it was literally kool-aid how many people were at the solana conference in portugal why is it in portugal what happens at a solana crypto conference i think there were thousands of people there and it was i mean easily and i mean it was kind of a mad house and people were trying to get in last minute nobody could get in because the conference was like totally sold out it was a lot of crypto developers a lot of people with projects and why portugal i think because there's a lot of conferences happening in portugal right now because they are easier on the covet restrictions and a lot of other countries so you can actually get in there and host a conference what was which stores with no masks um um i can't remember if like maps were required or not i did see people wearing masks indoors so were you required to be vaccinated do they do i did so i think i did show a vaccine pass at one point when i checked in i just did my booster i'm going to do my booster kind of it kind of uh it was a little i would say the same kind of shitty feeling as the second one where's that i just got fi i mean i had the first two were pfizer so i took pfizer she was the the nurse actually gave me a choice she's like you can do whatever you want physio madonna or j j i just i didn't know any better i texted my doctor so i just took um pfizer although the interesting thing is modern is the only one that's dose regulated for the third dose so there's a they they actually give you less specifically but pfizer is the same for all i think we talked about this on the pod there's one theory which they told you get whatever one you can get was the instructions because it's more important to just get one than which one you get but they said there's a swiss cheese theory which is if you took two slices of swiss cheese from two different bricks of it the holes would not be the same and therefore you overlap them so whichever deficiencies each one had maybe the other one doesn't so i should have gotten modern is what you're saying that would be i if you believe in the swiss cheese there i don't know fredberg you're a science guy i should ask aaron rodgers what he thinks i mean he's just straight up lied about being vaccinated huh i think so and i think the nfl's not doing anything about it yeah that's not cool i why would you lie about it i mean he's not he would have still been allowed to play so there was no reason to lie about it i i'm not totally up on that story the rumor is that kyrie is going to be playing basketball soon because eric adams is going to lift the vaccine restrictions uh you will not need to be show a vaccine card or wear a mask bro i don't work maybe i'll just get a pcr test every day i i don't think it's going to matter because the warriors are shooting the lights out and clay hasn't even come back yet and so that gary uh the second you see gary did you see gary payton yeah junior uh these clips oh the second i mean i mean he's like living above the rim oh my gosh his wise men back and then uh wiggins is playing great basketball i mean the warriors are gonna win this year i don't know steph is otherworldly right now yeah i think steph's got something to prove um even though he doesn't but he's playing like he's got something to prove okay so um do we want to just cover um the elephant in the room there the last episode i think we should get out of the way because it relates to solana there was we took something out of the last podcast so people understand we have an agreement between the four of us if there's something that somebody uh doesn't want on the pod after we record it we'll take it out because we don't want anybody i mean i think the philosophy haven't said this out loud is we don't want anybody to say something they regret that could cause damage to other people or to themselves so if they want to take something out that they said that's fine with all of us and um basically each of us has veto right on something so last week two people took their veto right on something and we took something out you want to explain our thinking on that sax and why we're reversing yeah okay so a few weeks weeks ago on the pod there was an oblique reference between me and chamath regarding solana and so and so some internet theorists that claimed that we were trying to engineer a pump and dump in solana which if you actually listen to what we said um it certainly is not a pump let me explain what it was so craft is the beneficiary because we invest we're the first investors in multi-coin we were kind of like their seed investor invested in their we put in something like 40 of the money for their special opportunity fund they were one of the first investors in solana so we are the beneficiary of about a billion dollars of solana so thank you multicoin at some point well so so they have started doing distributions by the time i texted chamoth they hadn't really started doing distributions i didn't know how deep and liquid the market for solana was i just asked jamath like i'd heard that tremont may have said something that he was long salon and wanted to accumulate so i sent him a text saying hey are you interested you know i thought maybe we could do an otc transaction at some point we get our solana he basically you know we had a brief exchange about that and then he mentioned on the pod that was the extent of it what i didn't know at the time but learned subsequently is that the market for solana is very deep about three and a half billion notional is traded every day so there's no need even if we wanted to fully get out of barcelona position which by the way we don't even have you know multi-coin still has most of it we it's not necessary to do an otc transaction we could just sell it explain what otc transaction is it just means over the counter it just means that instead of going to like uh an exchange you would deal with like a trading desk or it could just be direct like for me to chem off so that was basically the exchange it chamath and i talked about it for maybe two minutes and then it came up on the pod for 20 seconds so then some internet theorists basically clipped it and try to accuse us of organizing a pump and dump well obviously if you're talking about selling something it's not a pump it's also not a dump either so anyway the reason why we said cut it out last week is because we didn't want to give oxygen to this stupid like conspiracy theory that somebody had invented on the internet with like no basis whatsoever um because you could spend all day trying to like shoot the stuff down but then at the solana conference enough told me enough people told me that this was becoming a meme that i thought was worth addressing and what and look what you understand with crypto is that for every cryptocurrency like solana there are haters because they're invested in tribal or everybody's talking up their books there's pump and dumps and there are armies of anonymous twitter accounts that will coordinate attacks and or memes etc right so they're trying to spread the rumor that like vcs are big holders and solana and are going to dump it the reality is that multi-coin has a large position but they have lps they are slowly distributing their positions to lps in the forms of the tokens they're not selling them and giving you cash they're giving you the tokens you just decide what you do yes and by the way that's what we would like to do as well we're currently working through those mechanics because it's actually complicated for a pc firm to distribute you know in kind through tokens but well you had to give them to your lp so that's what i would like to do exactly so people are doing that with coinbase so coinbase is providing that as a service now from my understanding right so we're so we have to work through with rops that's what we're going to try to do is distribute it in kind so everyone can make their own decision i um i have a couple things to say so i've only been a buyer i've never um i haven't sold a single solana token and so we are you know net buyers and we're buying a bunch of stuff but i hate acknowledging that and this is why you know my tone was more non-committal when we did the pod is that i really don't like this culture that's emerged via twitter mostly where you all of a sudden have to be this maximalist that basically falls on their sword and never sells in order to be legitimate and i think that that's a really dangerous place to be so you know look if i take a watch that dangerous well if i take a much much bigger step back let me put solana in the context of crypto and let me put crypto in the context of the markets and where we are today at the end of the week after you know uh qt earnings uh in november of 2021 we have the stock market at absolute all-time highs ripping we have crypto at absolute all-time highs ripping we have the art markets i don't know if you guys saw phillips and christie's and sotheby's this past week at absolute all-time highs sold another people for 25 million we have inflation at a 30-year high we have 10-year break-evens at a 25-year high we have you know one point somewhat trillion dollars that we just approved last week and we're still horse trading on another three you know 1.8 trillion dollars of stimulus that we're going to put in and so when you and then you have i and i think the the most important thing which is the two most important founders of our generation the two smartest people who have really consistently won elon musk and jeff bezos have collectively sold more than 11 billion dollars of their holdings this year alone and if you can't take all of that and decide for yourself what's right for you and your family you're doing yourself a disservice i think it's important for me to never sort of like you know be forced to tell folks whether i'm buying or selling although i'm willing to do it in moments where i think it's important but i think it's really important to understand the context and so i think like these folks that like think derisively about individuals who are managing risk i think it's really naive and i think it's um it creates a lot of missed opportunity for them as well if the smartest people in the world are now selling their core holdings that they told you they would never sell and you are not reconsidering your position on things you're either much smarter than them or you're being really really reckless all right there you have it yeah you know i we just people also know inside baseball we have a docket of stories that we talk about on our group chat that make up the docket for the show but i'll bring stuff up and i didn't bring that up in some way to cause trouble or anything i thought you guys would want to clear the air about it and i understand chimao's position of hey you don't want to give these things oxygen or whatever but i think so i didn't even know that we needed to clear the air until you know i went to the conference and enough people mentioned it so but what's so funny is half the people on twitter spend all their time in crypto lens saying things like never going to make it have fun staying poor they're extremely jason as you said tribal i'm not sure that they're doing first principles analysis of these things they've gone they've got time exceptionally lucky yeah some of them are exceptionally good but many people broadly speaking have gotten exceptionally lucky and i think a little bit of it is getting to their head where they become you know very virulent against people that they think you know whose perspectives may actually be negatively affecting their position without actually understanding what david said which is these are incredibly deep liquid markets and one person's opinion is can't do much of anything right i mean that's a really good point i mean i'd like to give my opinion on solana but the thing or just crypto in general the thing that's like hard about it is that it's hard to talk about the benefits of say the salon of blockchain without being seen as a pumper of soul or a dumper of eth or whatever because all these things are so intrinsically connected i mean i learned a lot of really bullish things about solana you know at this conference uh i mean the biggest thing is i mean there's basically a a battle for the hearts and minds of developers going on right now between salon and ethereum that's why solana has raced up to you know over 200 i don't know what like seven thousand percent increase or some something incredible like that the reason is because solana as a blockchain gives confirmations back in something like 400 milliseconds whereas ethereum takes you know minutes and you know a transaction that might cost tens of dollars 10 20 30 50 of gas on ethereum cost pennies on solana and so that's the advantage yeah yeah exactly it's also you know a lot of developers feel like the tools the developer tools that they've created are easier than building on solidity the thing that solana gives up the trade-off that it makes is decentralization there's basically that transactions are processed by 20 validators and they're a top 20 based on holdings of souls so it's kind of like this proof-of-stake model so anyway there's some trade-offs there i can tell you that you know it's the view of you know our friends at multicoin and you know i heard a lot of this views at the conference although obviously you have to take it with a grain of salt because these are the biggest believers but their view is that solana over the next year will flip ethereum based on developer activity that there's real companies we spend a lot of time actually before we do anything is that's the only thing we've been looking at you know and syndica fractal a lot of the stuff that we've done deso is purely driven by developer interest when we see developers in the open source ecosystem building things on top of this stuff making stuff that's composable and usable by other people and building infrastructure you know we don't really second-guess that because they are spending their the most important currency which is not monetary capital but human capital yeah and there's the time and their skill and they can apply for another project yeah and so when enough developers so i i've always thought you just followed the developers and as more and more projects get started you just have to unemotionally support that i think the writing is on the wall which is bitcoin is gold ethereum looks like it's trending to be silver and solana could be the first but there will be others that come after it of real developer ecosystems that can be built on top of it the other the other thing that i would offer up to people for them to think about is before you blindly go and rush into crypto one way in which i try to think about these things is in the following way you see these projects get started all the time and i would view each of these projects as a mini economy and really try to think what is the economic value of what's happening under the hood so simple example you know helium is an interesting project that's trying to build a completely decentralized you know 5g infrastructure right render is a really interesting project that's trying to build a completely decentralized you know graphical processing infrastructure right gpus essentially in both of those things you can quantifiably economically measure what the value is that people get right in the case of render you're basically displacing an aws instance and so um that has a price and a value and so you know for render to be valuable there's an economic value that it replaces if you're joining a hotspot that has an economic value where you hadn't necessarily have to pay you know to get internet connectivity if you all of a sudden are on the helium network that displaces a measurable economic quantum understanding that is probably and taking the absolute value of that is the best way of really understanding which projects have potential so if you take those two ideas and marry them together where is their developer interest and where is their measurable economic activity at the intersection of those i think are the really compelling projects that can win well the thing that complicates all of this is that the developers are not just picking based on which language or technology or stack they think has the most potential they also have acquired economic stakes in it so a developer who might be objective and say hey this new platform is better than ethereum might be sitting on millions of dollars in ethereum and they're like i want to keep my bet going here um and i'm going to keep talking my book possibly but i but i do think that developers in general will choose the platform that's easiest and cheapest and fastest for them to develop on which would mean the list on coin market cap of market cap ones that has been static for a decade of crypto almost you know or largely the top 10 doesn't change that much it's xrp at stellar ethereum bitcoin tether that could be up for grabs that whole thing could change now that people are actually building projects and the the projects are getting competitive with each other and that's that flipping we're talking about correct sex yeah i think what's tricky here again is i never want to give anyone investment advice i mean that's just not my job and if there's anyone out there listening to the show because they're trying to get like tips or tricks whatever for investment like i'm not really comfortable telling people what to do um sure so you know everyone just has to understand that i did i do feel like what i saw at this conference over the past week in terms of developer enthusiasm activity was very bullish actually it was a lot like i went to the um ethereum conference i think was back in 2017 several years ago and it felt a little bit like that although i would say that this time it felt less academic like several years ago it felt more like white papers now it actually feels like real projects and businesses that people are trying to create still infrastructure and less applications or more applications mentioned a couple of them um so there's helium which is creating a decentralized network for wi-fi there's uh render which is creating a decentralized network for gpu there's one called hive mapper i met the founder it's a decentralized network for people to map the world you can think of you know the concept of a minor that bitcoin invented think of them more as like a resource provider to a network so with bitcoin you know we call them miners but they're the validators of transactions and we're trying to incentivize them through block rewards basically through small bits of uh bitcoin that get released to uh to provide these valuable computing resources to the network and so people are figuring out now how to create massively decentralized networks where you have you know thousands or millions of resource providers provide a little bit of something to the network for everyone's benefit in exchange they get some coin that's like a really interesting model that couldn't exist before crypto and so yeah i mean i think it's very interesting but you know in order for that to work you have to have like very you need fast efficient scalable blockchains and the feeling as i mean i'll give credit here to to tushar um who's one of the gps of multicoin his view is that this was the iphone moment for blockchain that that what salon has built because it's massively scalable and also very cheap i mean again you can run a lot of transactions for pennies now all of that is obviously very bullish for solana the thing i wrestle with is and jamal kind of allude to this is i think everything's kind of in a bubble right now because of monetary and fiscal policy and so you know i guess i you could say that i'm long solana versus eth but i do kind of worry that the whole world right now is very bubbly and so as a gp you're like what do you do about that i can tell you right now like this second we are sitting on solana that we have not sold so you know i am long in that sense however sometime over the next whatever number of years we will distribute out our position of solana to illinois and the lps will make their decisions and then they will make their decisions might specialize in crypto and want to keep it other ones might not want to hold assets and need that money to fund their endowment to give scholarships to students or whatever your lp's right particularly well yeah i mean and so i guess to the issue of hey we're not giving investment advice here we are all capital allocators and startup creators so we're talking about our day-to-day lives here nobody should interpret this as investment advice and especially not in a world now i don't know if you guys saw what happened with rivian this week i don't know how we don't talk about a company with essentially no public sales they've sold 148 cars to their employees it's worth 120 billion dollars any at freiburg did you see this ipo any thoughts on it um it seems like you have investment advice for the audience that you'd like to give tell me what rivian does wait can you play that video that you found that you shared with everyone you have that video you know okay well i we we do have it i can we could queue it up did you see this yet who is this guy no i haven't oh that yeah yeah well but just so i don't want to beat this point to death but i just think it's so important for the audience that what they should be getting out of the show if they're fans is maybe like advice on how to think yeah what a critical thing critical thinking how we think about investments tips exactly so look if you want to invest in crypto first of all like go understand like what all these different projects or blockchains do and figure out what is the purpose of the token in that system what are the token economics yeah does it even make sense or is it just a scam then if it's a if it's something like a blockchain go research how many projects are have developers on them and how much code is being checked in and maybe open a wallet and buy some nfts and buy some eath and transfer it and learn just how to set up your internet connection right right this was 1995. right exactly and then on top of all that you got to consider macro forces because i mean and i think you know my friends at multi-coin would fully concede this that you know it could be the case that if there's a crypto bust over the next year and this thing you know crypto has gone through boom and bus cycles for many many years it's the standard so you could have a situation in which for example solana flips eth and yet still goes down in value because there's an overall bust cycle so you know you have to consider the macroeconomic factors as well so there's a lot of things to consider here and then you also have to consider your own risk tolerance and you know what is appropriate for your portfolio and i mean when do you need your money are you a 25 year old everything is at all time highs and the two smartest men in the world are selling not just not just them by the way there are other guys that are heavily on the other side waiting for this whole thing to go like drunken miller has been very vocal about this um and he's uh he's been the best macro trader in the last 30 years so his position is what exactly that we're printing too much money and we're in a lot of trouble so you know look i mean generally there is um i think a good point of view being shared here uh which is you know understanding how to think about what you're investing in and what your uh your expectations are versus relying on someone's advice or opinion on what to do if you have to rely on someone else's advice or opinion on what to do you're gonna eventually lose money you should not be in that investigation you should not be in the market because guess what anyone that's giving you advice or opinions is gonna make money if you do what they tell you to do if you do what they tell you to do end of story so at some point they're gonna all make money and you're gonna end up losing money and it's a it's you know it's it's it's a better game to play to learn how to kind of be thoughtful about where's your money going what are you investing in and it takes a lot of time and a lot of money i've been sitting here silently as you guys have been talking deeply about solana and ethereum and bitcoin and the crypto markets because i realized so much of um you know what's needed to be successful in entering this market is a depth of understanding a depth of knowledge my time is highly limited i have spent no time on understanding crypto markets because it's so deep and it's so fluid it's changing every day it's changing every week so if i can't get smart enough to feel confident about the opinions and decisions that i would be making as an investor i decide not to invest and i stay out and so i'm not an active crypto investor you're a specialist and you're on the razor's edge on synthetic biology and and so many other whatever it is there are there are other areas where it's better for me to spend my time and my energy and i've chosen to do that versus being drawn into what view what feels like a very exciting kind of you know turbulent time there are other areas that i kind of spend my time on i just kind of try to recognize that maybe i don't know what i'm doing if i were to try and get involved here and so i'd rather stay out and i think that's council forever for anyone you know if you're going to make an investment it's important to feel confident about the knowledge and the depth needed to kind of be different than the rest i'll build on your point like when i when i started doing my spax i um started to write these one pagers and those one pages were artifacts for me to hold myself accountable for how i saw something in a moment in time and then to be able to see whether it was tracking to that and then also to share it to other people a starting point as david said a journey where they should then if they're curious go and do their own work it turned out not enough people were doing the work so then i had to start adding disclaimers to these things saying hey guys uh i'm not telling you to buy this please be abundantly clear these next backs that i will eventually launch you're to see an entire like in red block letters like please don't buy this right because to your point it doesn't matter what you say people want a lazy easy way out and so i just want to reiterate what all of you guys said none of us are dispensing advice we are not telling you to do anything please do your own work and please come to your conclusion it is your responsibility and if you're not sure go and look at your children in the face or your significant other in the face you are responsible to them and so do your own work i'll say one more um point on where i sit as an investor um i i choose uh to only participate in investing in what i call productive assets that is you put some money into something and whatever that thing is is generating money in some way or is trying to generate value through a set of activities uh like a business um or owning an apartment building where you're making rent you know anything that or you know a group of people that are trying to have some breakthrough or some discovery those are productive assets there's a lot of what's going on now that is what i would call speculative assets which is the only way you make money is if someone else pays more in the future versus what you're paying and there isn't an underlying productive asset to what you're putting money into are you're describing every ico or every ico every nft and the art market right these are these are examples of unproductive assets they're speculative assets in the sense that you're speculating that at some point the price of them are going to go up and someone somebody wants that nft more than someone down the road will pay more for that asset than what you paid but that underlying asset that capital that you just put in didn't go in to build something it because nobody wanted a new generation there was no ip you went into someone else's pocket that sold that asset to you and you're eventually going to try and sell it to someone else and so you know there there's a there's a real attraction here because what we just talked about is really hard to do having fundamental analysis and understanding of businesses and a fundamental understanding of what's working and what's not and when to shift and oh my gosh you know are things different or are they not to do that is really hard so people end up relying on opinions of others or they end up running into speculative markets and the speculative markets are easy to understand someone just paid more for x than the other person did therefore there's a trend line it's going up it's like playing roulette and you know black keeps coming up and you're like okay it's gonna be black again it has to be black there were seven correct there were seven blacks and so i i think that that's a really important kind of takeaway for for for folks that might be new as investors we're all susceptible we're all susceptible to this like i was just looking you know at my own performance coming into the end of this year and you know um i did a lot of specs this year but i also did these pipes which are these third-party deals private investment in public entities exactly other people's deals that they were bringing to the market where they said chmath do you want to be a part of it and um you know and i did and part of it was i was looking at these things and you know freebird doing my work but in the end it turned out i didn't do nearly as much as i probably should have because i ended up sitting on top of other people's work versus the original or underwriting that i would do if it was my own deal itself right anyways the net net of it all is like you know that was very inefficient capital deployment and as i look at it now it's like you know i'm down well i'm i'm technically up 19 but that's really because of one deal if i take that one deal out which is a total outlier i'm down 17 on about 200 million dollars of investment when you are a fast follower not the originator it wasn't your idea this is critically important there are many different ways to make money but you have to specialize and you have to first and your knowledge i trusted other people i did the same thing that i that i'm saying to other people about to do do not just copy other people you have to do your own principle work and even when you do your own principle work it may not be enough and you have to be willing to basically see the forest from the trees and walk away and so all these pipes i'm in the midst of sort of cleaning up and selling down and they've been just a kind of a disaster for me you know hold on i'm gonna build on this for a second because i think it's critically important what you said as well friedberg you have to be comfortable with the investment you're making i look at these companies and i look at the underlying customer the product you know and what kind of revenue it's going to generate and people thought i was dunking on rivian yesterday and i said listen you know when tesla went public people forget their valuation was 1.5 billion 1.7 one point okay so 1.7 billion uh when they went public now they already had thousands of roadsters and they had already had the no they had 93 93 million of revenue in year one so this was dramatically different than what riven had riven is being valued at you know whatever that is 120 billion i think yesterday rivien has 17 billion in cash somebody asked me at the poker game last night what i value driving at i said 17 plus three 17 million in cash plus three billion double roughly what tesla's was the market's hotter right now whatever but i put them at 20 billion and people were giving a hard time about i said i think that's actually the realistic valuation for this company and we are in a very dangerous moment in time right now where i think people are whether it's meme stocks or crypto or nfts suspending disbelief in some cases spax because they're not all created equal and certainly in private companies we're seeing this where people are giving people an amount of credit which makes no logical sense and is getting further and further disconnected in from reality so as an investor you have a choice either you have your fundamentals which i'm not going to change my fundamentals i'm going to focus on the fundamentals that got me where i am and i'm not going to be involved in a 100 billion dollar market cap company that hasn't launched a product yet let alone 120 billion one i'll stay focused on startups but what you're saying is also important because you're highlighting how you value that company you individually said i think that company's worth some multiple of how many cars have been sold in the past elon sold you know thousands of cars he was worth 1.7 billion these guys have sold and other people are coming in and looking at this company and saying they've built facilities they've built assembly lines and they've got pre-orders and bookings for lots and lots of cars down in the future and clearly they've gone in and you know some people have gone in and seen these plants and seen these cars actually working so you know it's really important to take note that your point of view is one point of view in a very diverse market with many points of view and everyone's going to come into this market and that's why unless you individually as an investor have a strong point of view and can show that you can apply your unique insights to consistently beat the market making decisions investment decisions like that you're eventually going to lose because those other points of view will be a bigger view of the truth and you'll lose money and that's why that and that by the way that's why picking stocks is ultimately a loser's game unless you have some unique ability and insight for most people historically and in an enough market right you need to have an edge and the public markets are hard to say that there's i mean if we double click on what you just said as the things that would be reasons to in bet on rivian number one they have 48 000 orders of pickup trucks against the f-150 which is now electric from ford and a million i don't know why i don't know why you're arguing this right like you're just making a point that we don't have someone on the on the on the panel right now but someone else could come in and argue okay and i would just say this is the part of the conversation to be honest jason to give you feedback i don't like because rivian just in defense of rivian for a second what i have heard is that it's a it's a well-engineered car or truck rather they've done a very smart path to market which is essentially to you know build these delivery trucks for amazon that allowed them to even frankly you know be default alive sure versus you know to use the paul graham term instead of default dead i think the point that's more important here is that it doesn't affect you so let rivean do well you know and this is part of the so i shouldn't have an opinion publicly no no no i'm just saying this is the part of the cycle that i don't understand where people legitimately have these zero sum points of view about companies um and this is where i think uh free burke is more right than anybody else which is there are the market is the sum of all these collective points of view sure and i think it's fine i think it's fine to have one i think it's a little superficial your point of view because it's not really you know sitting on top of a model or anything else and i think it's the same kind of superficiality that the tesla cute guys had about tesla for many years as well it takes a long time has somebody that does this every day and i just want to point this out it takes an enormous amount of time an enormous amount of work to be 55 350 companies i meet with you in the public markets jason it's different my companies are going public now so i take exception to what you're saying i know a fraud when i see it i've seen them before that's a really big statement no but the distance between the valuation and reality is in the 50 capabilities that's not in control of that's not in their control okay that's in a bunch of external market participants control so you can't pin that on them my point is the market right now seems dysfunctional and jason properly measured that you then you should throw shade at t row fidelity all these people that are bidding up your companies by the way because they are the ones that are taking review into 120 billion it's not rivien's fault and jason what's really going on in the market was public speculators no what's really going on it's not you can't sell 16 billion dollars of uh in an ipo to speculators these are much lower prices these are institutionally placed uh trade orders but regardless the market is clearly right now in in productive assets businesses the market is looking at a time horizon that it has never looked at before which is making bets that are 10 15 20 years in the future and that's because of the condition that we're in right now from a monetary policy point of view interest rates are so low there's nowhere to get yield in other assets so you have to look further and further out to find value so the market the market is betting is making 10-year bets which is like a vc times more than a 10-year map yeah and jason sorry can i just can i just finish my last point because before you interrupt me my issue jason is i think you are an exceptional angel investor but just the same way you derided a bunch of late stage guys remember last night at poker when we were talking about late stage folks entering into the angel market and the er series a you were extremely dismissive because you know what the job is to be done to do that job well and they have a different skill set similarly what i would just offer for you to think about is the people that really underwrite public market stocks well do things and have a skill set that is extremely specific and it is well trained as well and i think that okay all right no i accept i'm gonna i'll just let me i'll let me jump into that since you want to defend me and that's the people are in shock right now way to get yourself back in the game okay so here's where i think jake also i don't know anything about the derivation company but where i think jkl's right is we've seen over and over again that when a company gets when a startup gets a billion dollar plus valuation without a product invariably it ends up somewhere between a disappointment and outright fraud whether you know it was theranose or magic leap or quibby or whatever i'm not saying they're all frauds i mean i think just theranose frauds trading arts whatever so i think it's reasonable for any let's say seed or early venture investor to develop the heuristic then i'm not going to invest in anything with a billion dollar with basically a unicorn valuation without seeing the product first because we've learned we've got our hands burned so many times from these overhyped companies and here's why i agree if i can't see and use the product i'm not investing i'll invest in a seed stage but i will not invest in a unicorn stage no way i i agree with that but what i'm saying is when a company is going public like that there is demonstrable proof of concept there okay the only market in which that's not true is in biotechnology well i would say for fisker and nicola two related companies those ones seem very very shaky you can debate about the scalability of these things and you can debate that people didn't do the diligence but they had to at least put a proof of concept out there for you to judge if people don't do the work i agree with you like if you're rolling a truck down a hill sure outright fraud no but my point is if you were there and you did your work you would have seen what you needed to see what i have heard from people who were investors in both lucid and rivien is that they have sat in the cars they've driven the cars they've spent time with them they've seen the factories and it's very much real now what they're debating is ramp and velocity and scale i don't know i don't have a position in either neither do i have the bigger macro point of view which is important to me which is it's it just because these things are in the public markets i think people think it's easy to judge and i think actually modeling them and making good decisions is just as hard as it is for private we need to roll this clip because there is somebody who is giving exceptional advice on cnbc let's roll the clip yeah so well up starts up about 25 just in four days since we since we bought it we bought it on uh about four days ago uh so that's actually made a nice little move in the uh short term probably a little extended right now but longer term uh that that's a that's a good looking uh name a very powerful very strong earnings these stocks are actually they do not know what do they do uh excuse me what does upstart do uh well i'm i'm sorry what kind of company is it [ __ ] god brutal who is this guy who is he i have no idea jake how's that is that is that like your uncle or something who's that guy i listened yeah i i i mean what do you want cnbc well you know the guy's been on many times but doesn't this prove what we were saying which is that exactly you've got to do your own principle work here that that is why we wanted to play here's a talking head who's probably getting paid for selling some books and giving advice who knows nothing about what he's telling you you can join his membership club for one thousand a month yeah i'm sure he's publishing lots of papers that show that he's a highly successful profitable investor and look how smart he is he doesn't even know the company he just promoted on cnbc it's incredible on a um mechanical basis here chamoth you and i have been on cnbc many times in that moment uh what is going on what do you think is going on in the host's mind and the the producer who has to dump this call because they're watching this let's move on i just the breakdown where he says i'm sorry i i have no idea uh what do they do i think the point's been made i think the point's been made oh my lord everybody should do their own work yeah do you work just actually look like you want to say something i mean i just chose the agenda yeah look i mean there is a massive agenda in corporate journalism there's an agenda by the people on these shows to promote positions there's an agenda by the reporters themselves uh and on and on and on it goes so to jamaa's point if you just take them at face value you're and you don't do your own work then you're buying into someone else's agenda trust yourself okay uh one thing that we are trying to all understand uh is inflation the cpi uh has gone up 6.2 in october highest jump in 31 years since 1990 according to the wall street journal fifth largest straight month fifth straight month of inflation above five percent you know somebody tweeted out we'll pull it up here uh denver bitcoin put out a year-over-year commodity chart uh we can throw up on the screen and then uh i think friedberg you shared in the chat the average weekly retail prices around fertilizer what are our thoughts uh on the nature of inflation and how that affects our investment i i think it's persistent and the reason i think it's persistent is that there's a the all of these things are intertwined and so you know if you want to just bear with me for a second like when when this let's just go to the the entry-level economic job right so you're a barista at starbucks or you work at mcdonald's and you're making 17 to 20 dollars an hour what that does is it shifts labor and eventually there are other people that are entering the workforce or you know may shift jobs and essentially it just causes this leaky bucket effect where everybody else has to then accommodate itself so you know you have a guy like uh you know you have a company like amazon which is now going to pay 25 or 30 dollars to keep folks right because otherwise they may say oh you know if i make 15 or 16 an hour i'd rather work at mcdonald's it's simple it's not back breaking work blah blah so then they start to um increase the amount that they pay they increase their benefits and the like didn't i saw this thing this week there's a crazy thing that's happening though which is it's now pulling people from non-traditional job classes into those jobs there are teachers that are leaving teaching to go work at an amazon warehouse there are firefighters that are quitting being a firefighter to go work at an amazon warehouse because you make the same or more plus you have all of these other benefits and the job is structurally a lot easier and so people are making different optimizations and to that point i think we talked about this in nick you can put it in the group chat in reddit as an example there is more engagement in the subreddit around having a simple work life than there is now in wall street bets right so there's been a structural cultural change where people need to get paid more to do the same amount of work and then at the same time you have all of the all of the supply side getting more expensive fertilizer makes corn more expensive lumber makes house prices more expensive chip prices makes the iphone and cars more expensive or completely backlogged you know yesterday at poker sonny was showing us he bought a tesla and the delivery period october of 2022. yeah it's great it's freaking crazy so i i think that it's a it's this is the beginning of a persistence i think those are all like really valid points the thing i'm seeing now is i think we've moved into um what i'll call a contagion phase of inflation which is people are hearing about inflation they're seeing it in some places my gas went up a little bit my milk went up a little bit whatever and they're saying well i guess if everybody's raising prices i need to raise the prices as well of whatever i provide in the world so i can just keep up with everybody else and they're not looking at their inputs necessary and saying i need to charge more or that's the best business decision they're just saying everything's going up around me and so they raise prices i've literally had this happen three or four times and i went to buy a car and they wanted 15k oversticker and i didn't buy it based on principal but i'm sitting here going like maybe i'm an idiot maybe i should just pay the 15k overstick what do you thought stacks on inflation and the contact my thoughts are i told you guys like six months ago about this yeah can we just replay what i said on episode 32. it's got his researchers in the background giving him you've written down what you said on her episode no this guy's in the [ __ ] debate club stanford debate club over some of us when we make predictions take them seriously so you know is that a dig that professor ice cold takes i'll give you guys a link to a prediction that was made here's oh i mean i just want to replay the 20 seconds here we go the two david's dueling again just like in the group chat here's freedberg january 1st 2021 if you don't think inflation is already here you missed what happened to the stock market companies aren't performing better we're just inflating everything financial assets first everything else will follow that was a good one just make your point just make your point just add the clip i'm beginning to wonder if biden's going to be a jimmy carter here because frankly all he had to do was leave things well enough alone covid was winding down we had a vaccine all they had to do was distribute it to as many people as possible and covet let the recovery take shape and instead they pushed this insane 10 trillion dollar agenda he's gonna backfire massively look if the economy turns we were set for a post coveted boom and right now that is all at risk because mouth like you're saying they're keeping the economy closed or parts of it way too long they then over compensate for that by printing a ton of money and then they overcome say for that by raising taxes too much just just to build on that so that second step of their overcompensating their inability to open with money is so true because then what happens is your labor force stays impaired because people make enough money by not working it was true when i said in may it's even more true now he said it was there was inflation okay so there's inflation okay so now great good job somebody makes a prediction yeah i made one in january that said the same thing now look you can do three things to you can do three things to curb inflation raise rates right when you raise interest rates you slow spending prices come down inflation slows but the issue when you raise rates is obviously you see things like job loss and economic growth declines and it can very quickly spiral the other way this is the big challenge of fed tapering the other option as we've seen a significant attempt at lately is to raise revenue right so increased tax rates uh tax a broader swath of people at a higher rate or broader spot of business at a higher rate so it's very likely that you know tax revenue could kind of present itself again as a driver if inflation continues to spiral up and the third which is the least likely is cut spending right the the federal government spending the way it does right now makes a very inefficient way of kind of putting capital into the system and inflating we've seen historically that anything the federal government spends money on like health care and education the costs very quickly spiral out of control super inefficient why not just give that money to the free market to make decisions on how to spend it it would be more efficient etcetera and the market would effectively find balance where buyers and sellers are equivalent as opposed to having the federal government driving the price of everything up the fourth option that people don't talk about which i think may end up becoming an important option not kind of oblique option but more kind of backdrop is to start a war and you know when you start a war dog the dog yeah when you start a war you stimulate the economy without needing to pump additional capital in so you can increase growth and avoid the risk of stagflation and you can source resources that otherwise wouldn't be kind of flowing in the trade or basically in a land grab type situation but it doesn't necessarily mean that policymakers would say hey let's go start a war to decrease inflation taiwan but the premise that conflict can improve the economy is a important backdrop that starts to play into policy decisions that might get made over the next couple of months and quarters and that's really important whether or not the posturing is one of partnership and and reducing the tension with foreign nations or one of increasing the tension it's more likely that we would want to increase the tension when we're in an inflationary environment so that's quite a conspiracy there so what do you think sex okay let me we gotta go back first principles on this thing we're not gonna start a war to tame inflation okay but let me just explain what inflation is because i'm not sure people like fully understand like how this works inflation's very simple it's too much money chasing too few goods okay and we have both sides of the equation going on right now on the supply side on the good side we've got shortages we've got the ports backed up we've got paying people not to work we still have the 2 trillion of coveted relief passed earlier this year which was responding to a problem that was largely winding down so we have these labor short we have people dropping out of the the workforce in record numbers in the number that just came out showed in more people quitting their jobs than ever before so we have a shortage in terms of the production of goods and services that people want the same time we have this monetary and fiscal expansion coming out of washington you've got you know again they did the 1.9 trillion of coveted relief they did 1.2 trillion of infrastructure buying still talking about another 2 trillion of social welfare you have the fed still printing money with qe so you've got this massive expansion in the amount of money so look too much money chasing too too few goods creates this problem and it was very predictable and so what i said back in may that's what i was warning about and it goes back to the druckenmiller clip that we that we were talking about all the way back in may he said the same thing that we had a reckless fiscal and monetary expansionary policy coming out of washington at a time we didn't need it because if you looked at like retail spending back in may it was back to above trend so you know in other words like there was no demand problem the economy was back and they've just been pumping and pumping out of washington we made a we had a we had good intent we wanted to make people not suffer we wanted to get the economy on tap we may have just made a bigger bet than we needed to we overdid it we overdid it clearly but look who wants to be the politician quite frankly yeah he's not going to get you who is the who ends the eviction moratorium right the gravy nobody wants to be the politician who says okay now you suddenly have to pay your rent but obviously people have to pay their rent and we're taking away your bonus unemployment i mean people have to go back to work at some point when there's 10 million jobs open just as a uh i've been watching the taiwan situation like a hawk and i don't know if you saw this this week to go off on another tangent but the us is testing israelis iron dome and guam as a defense against chinese cruise missiles obviously um for possible deployment in taiwan and i don't know if you're watching and it's cancer in the nba uh but he has been going on cnn and stuff like that now talking about china pretty amazing i i predict escalating global conflict that'll be my prediction to mark the q4 well i i think that's i think actually that's a pretty valid prediction but i just think it's a little bit separate than inflation like i said it's not an explicit decision but i do think that in the backdrop of an inflationary environment where you have something that can temper the condition at home that at the same time you know might sell politically but we don't need but it's not going to solve anything politically okay i mean world war ii you know famously got us out of the great depression because that did stimulate demand but in a situation we're in today we have too much demand we have retail is trending way above curve what we have is a supply shortage and devoting resources taking them away from the productive economy to go to war would only exacerbate the problem and make it even worse what we need right now actually is for washington to back off to stop pumping demand with this with you know now they're still talking about this two trillion dollar machine so the money printing that's what we've got to get out of the way and to um to stop these disincentives for production and work so you have ma i mean mansion was exactly right about this okay do you remember when manchin when he was resisting this two trillion dollar social welfare bill i mean the things he said are already coming true i mean he said this months ago he said that we should take a strategic pause because he said this is a quote by all accounts the threat posed by record inflation to the american people is not transitory and is instead getting worse from the grocery store to the gas pump americans know that the inflation tax is real and dc can no longer ignore the economic pain americans feel every day that's what he was saying this past summer several months ago and they rolled right over him the psychology of this could be could be self-fulfilling as well because what's going to happen is you're going to have everybody raise prices because it's now become an escalation you know your hairdresser your you know whatever you know services you're using whatever product you're buying whatever restaurant you're going to is going to put two dollars on every appetizer and five bucks on every entree everything is just going to keep going up and then what happens is people who in the middle class or you know who are consumers of products in a large way will say you know what i'm going to put off buying a car then we're going to be driving all this supply up and then people are going to say you know what [ __ ] it i'll just drive this one for two more years that's going to cause stagnation and this is called it's what we have in the 1970s and you're right it's called an inflationary spiral which is the future expectations of increasing prices means that people start increasing them now and that feeds on itself yes and that's what we had in the late 1970s and the thing that broke that was paul volcker jacking up interest rates it was very painful it caused a very severe recession in the early 1980s but then the economy came roaring out of that by 83 it got reagan elected in 84 and you had 30 straight years of declining interest rates and that led to a stock market boom so the problem we have now okay here's the problem we have is there's going to be no paul volcker why we can't afford to jack up rates because the federal government's debt is so much bigger than it is we are not on a fixed rate we're on a variable rate all of the debt we take the average maturity of government debt right now is five years okay so that i mean that means the whole debt rolls over within five years so if they jack up interest rates we have almost 30 trillion of us federal debt right now so every one percent that they increase interest rates that means another 300 billion a year of debt service payments yeah exactly so there's going to be enormous pressure on the fed not to raise rates you already are hearing biden rattling the sabers saying that powell may not be his choice for a second term by the way powell is very dovish he's basically saying we can't raise rates right now because of this and that so and abide in the administration nobody in washington ever wants rates to go up right they want to keep these low rates forever this is the problem is look at the end of the day i don't know what the inflation picture is going to look like next year but what concerns me is we don't have effective tools to fight it anymore because we've given up our ability to raise rates because it would it would increase the cost of the debt so much and i mean so with just one article just to share with you guys is this again my one of my favorite sources of economic information is the the fred blog which is from blogs right from the st louis fed okay talking about two tales of federal debt okay and the article is about here's why there's so much disagreement on whether the federal government debt is too high so the first chart shows debt to gdp this is always the way of looking at government debt was simply looking at the ratio of debt to gdp it's now something like 125 percent in peace time i don't think we've had a higher peacetime ratio that would tell you things are out of control but for the last decade while it's been going on you had this whole school of thought the mmt modern monetary theory all these economists and experts and politicians in the media were eager to buy in because they want to spend the money okay and what they said is no it's not debt to gdp you should look at debt service to gdp this is the second chart on that blog and so debt service to gdp was was staying constant or even going down as the debt to gdp was going up why because interest rates were so low the problem is what was so foolish about this point of view is it is assumed that interest rates were going to last forever well if that was your point of view why didn't you do what trump actually suggested several years ago when he suggested having 100 year t bills they should have locked in much much longer duration maturities on the federal debt and instead and yellen rejected this okay and so you've got a five year average duration which means that if interest rates go back up the debt service cost is going to explode yeah so in 1980 we changed the goal posts for cpi so even as a measurement to know what we look at and i think jack dorsey tweeted this out so nick you may be able to find this tweet but you know we changed the measurement of how cpi measures and so if you go back to the original measurement uh it looks like inflation in cpi is uh much more pernicious than we would otherwise think it if we just look at the the new cpi that we that we started to look at as of 1980 so um that's another sort of like point we did this we did the same thing with i just go back to what i said early on had given up looking for two smartest people that we both know are net sellers well they're selling some yeah i mean they're not selling i'm just saying the two smartest people we know i mean we don't get financial advice here but should everybody be moving to cash no where do you put your money i don't know i'm totally confused this is i think the admission just buy productive assets great businesses that have durability and let them ride for 20 years i i like your answer the fact is we're all confounded as to what to do at this moment in time we're all trying to figure this out and we do this for a living but then you're trading the market like everyone else all the time like you know why trade the market where you can just buy great businesses own stakes in them and let it rest no i'm just talking about this i mean my practical issue is that i don't have infinite money and so in order to put my money into productive assets i have to sell other productive assets well if you've got other productive assets leave them in why sell well then it's like then i'm basically you know doubling down on a world view that may be old and dated right so if i'm along a bunch of software companies and i really want to do something in climate science or biotech what am i supposed to do don't try don't try and time the market shift your assets right why do you care what the no no i'm not trying to tax this i'm not trying trying to time the market i'm just saying if if my world view shifts to really want to double down on climate science or alternative finance or biotech i have to raise capital to do that you have to raise capital is what you're saying right but but for me i'm not raising it from other people i'm raising it for myself so to me the best place to be right now is in the company formation space because when you create a company um like friedberg does every three months there is so much value being created at that moment in time and so much further capital getting poured into it that if you are the originator of the company and you get some big slice of the cap table for doing that which is completely valid you originated the company whether it's unique or call in or whatever it is man that is a great moment of creation of wealth creation and when you're the person putting the money in at the billion dollar evaluation before the company whatever call in i'm sorry clubhouse went from 100 million to 4 billion with no revenue i don't know what's happening in the world but pretty crazy do you want to go on to um xi jinping and his he's going to be speaking with biden on monday it's done he had he got it done before his his video his zoom with biden oh yeah so they're doing this now the supreme leading hasn't left china the supreme court explain what this means uh from the story um i mean i think the basic the basic takeaway is that they've been working inside the body politic inside of china to basically reflect g on the same level as mao and um and effectively what this means is that it it allows him [Music] to remain um the leader of china indefinitely and so um there is no transition of power typically what had happened was these there were these ten-year windows and you know you you you go uh zhang you know 10 year cycles and then they pass the baton but it now looks like we'll be living with xi jinping until um until you know he he joins the after world so uh he's a ruler for life of china basically crazy i don't think that's exactly right what an incredible feat of political maneuvering without judging it just to say how what a complicated byzantine political infrastructure he must have had to navigate i don't know how he played this three-dimensional chess with all these people the slow systematic dismantling of the old guard placing all of his people in then slowly moving towards this this kind of recognition he's admiring yeah no the dictator got his name for a reason somewhere donald trump and steve bannon are like what did we do wrong we were so close january 6 we almost if pence would have just played ball sacks you'd still be in power huh your guys dropped the ball and we wouldn't have inflationary just think trump was leader for life you know jason given how accurate my predictions have been you should have a little bit more respect for my uh political positions what do you guys think happens now that g basically is ruler for life you know he i think the chinese term for it is historic figure which is yeah saying you know you're you're basically um you're a maid man basically you can't get whacked nobody can touch you you're good for life the end nobody can question you i mean can you imagine mao zedong then you know deng xiaoping and now xi jinping incredible like he is at that level well it means if you start a war and a serious military conflict that nobody can question you right you're the supreme leader so it's sort of like putin and mbs like mbs can go kill a journalist and he's got nobody to answer to it means he has nobody dong initiated the revolution and you know deng xiaoping was really the architect of free markets that has made china the economic powerhouse that it is today their internal reflection is xi jinping is on the same scale of that now i mean i can't claim for the future yeah what is the accomplishment that's going to really put him in that league and and you'd have to say it's the annexation of taiwan i mean that's the thing that he must be looking to do before you know his time to reunify china that's the thing that could put him in that league and so that that is the trip wire that to friberg's point that could lead to you know a conflict i i think they you know i hate to say that freeberg is wrong uh because like i don't think in this case i can i do think that there is some left tail risk for like a crazy wag the dog moment in taiwan it would be really scary really scary right now if i was looking at the sizes of the navy's people don't know this japan actually has a very large defensive navy the uk and the united states obviously have very large ones china's is large but not on a tonnage basis they have a lot of ships but together i don't know if you saw the military exercises going on but new zealand australia the united states uk and japan uh were basically i think south korea would were basically driving their ships around the south china sea this is going to be i think yeah so you know i did i did a really interesting interview with um the historian and commentator neil ferguson yeah who is also a pretty avid china watcher and i did an interview with him actually on on my app uh you don't want me to say the name shall not be yeah but anyway so he he had a really great line which is he said that the that type the issue of taiwan it's basically like the issue of cuba and berlin and the persian gulf all rolled into one so it's like cuba and the cuban missile crisis because it's right there off the shore of china it's like berlin you know because that was basically the dividing line between freedom and you know totalitarianism you know where where the berlin wall got built and it's like the persian gulf because the new oil are the semiconductors the chips that are fabbed in taiwan at tsmc and so all the resources that we're dependent on for the new economy are all right there so super smart framing yeah it's i thought it was a clever line the thing we have to remember about g is that his father was um was a commander uh for mao and was in a vice premier and so you know his historical he is the original princeling right remember you know there's this context of these chinese princelings but he is he is one of these originalists and so his motivation will be it seems at least to bring china back into that spectrum of power which is really about a consolidated country um and a single nation state and that has to include taiwan it can't it can't not so to your point david it's almost more motivation for him to go off on some crazy adventure and try to reclaim it it's really interesting to look at the tonnage of ships and the number of ships the united states has over 6 000 tons of ships 949 according to globalsecurity.org china has to only 2 000 tons and a thousand ships they have a lot of smaller ships uh and then russia uk india japan france indonesia turkey germany illinois warships jason or yeah this is their their navy warships um and so they're fighting uh but japan has a very large one i wasn't aware of this because i thought they were not doing military buildup but they have what's called a defensive navy uh which can't do offensive stuff so this is um i think this is really problematic how many of these ships are smaller than sax's yacht that he rented this year yeah saxis tonnage would kind of put the united states over the top i think in this gross cottage of sax's yachts is going to be donating his new yeah no for sure it's bigger than indonesia i see indonesia on this list turkey i mean how big in my defense it was a starter yacht it wasn't my indefensible next stop next one next one will be bigger yeah solana is going to make sure of that right yeah you can buy yachts with solana all right i think we covered enough uh ge and toshiba can't run their businesses so they're each separating into three separate let's talk about that that's interesting actually and johnson and johnson yeah today all right so on tuesday g announced they were splitting into three separate companies aviation healthcare and energy toshiba reported a similar plan johnson johnson today johnson johnson was today this is um in direct uh conflict with the consolidation and the creation of conglomerates and it's not good i think this is an important point jkl um you know in the 80s and 90s it was cool to create conglomerates meaning you would kind of stick businesses together that were rjr somewhat disparate um because you could financially engineer a way to do it that would juice shareholder returns right you could borrow money add lots of scale the cost of debt goes down you could increase your debt load et cetera um and you know the challenge is like when you're scaling a business you either need to grow your revenue organically or you need to acquire and when you're acquiring you're either acquiring horizontally or you're acquiring vertically meaning you're kind of integrating your supply chain or you're integrating um or you're adding ancillary businesses that you can cross-sell so you're either reducing your costs or increasing your cross-selling ability so there's some inherent synergy in the acquisition the problem with conglomerates is there is very little synergy meaning like when you acquire a new business like an aviation business it doesn't create synergy for your healthcare business and um you know there was always a rationalization that these managers of these big conglomerates had which was like oh well we could do this and we could do that at the end of the day it was financial engineering where they simply kind of used debt to reduce um you know the cost of capital and increase the shareholder returns and now everyone's kind of waking up to the fact that you're actually decreasing value because an investor that wants to own an aviation company doesn't also want to own a healthcare company so the investor doesn't buy those shares and the investor that wants to own the healthcare company doesn't own the aviation company so they don't buy those shares so the way to increase shareholder value is to actually split those businesses up and then the investors that want to own the aviation business will pay more and the investors that want to own the healthcare business will pay more and the overall value of those two businesses goes up by having them be separate and that's what the market's kind of waking up to and this is kind of a trend that's been going on for years now you know going back to kind of 2013-14 where the market started to kind of rationalize some of these silly conglomerate business ideas and break them apart into more kind of you know targeted businesses that can actually spin out or or yeah or break off breakups yeah that can basically attract shareholders to bid on each one of those businesses individually and drive value up you know we saw one business i was close to that i saw this with was dow dupont where they you know down merged with dupont and then they split into several businesses that each were focused on a particular vertical and it made a lot of sense to drive value for uh for for the for the overall shareholders so at the end of the day you know these conglomerates are about kind of driving economic outcomes and the only folks that you see doing this well are folks like warren buffett where the job is really about capital allocation where you know you can allocate capital to the best business and that business on its own will grow organically versus taking a bunch of crappy low growth no growth businesses levering them up to kind of juice the returns on each other and we're seeing this slow unwinding happening so i think it'll it'll continue to and you can probably go and pick a bunch of these conglomerates and you'll see the activist shareholders doing this they'll they'll buy a bunch of shares they'll instigate and say hey you guys should break up the share price will go up by 20 30 percent so if you want a stock tip of the day you know go find the next set of conglomerates that are going to get attacked and broken up it's interesting and you know with public markets dell is spinning out uh vmware and that's going to create a massive amount of cash and shareholder value they're doing a huge dividend so i guess my question to you chamath is when do we start to see this hit not from a point of weakness but from companies that are strong and see this as hey this is a way to just unlock shareholder value will we see an amazon spin at aws a youtube or an instagram come out of their parent companies i think it's very rare that these things happen on the offensive foot i think it's typically a defensive maneuver that's driven by really poor returns over long periods of time or activist investors totally i was about to bring that up i mean do you remember how hard that ebay i remember like john donahoe was the ceo he like fought that so hard i remember getting a phone call from him asking if i would support them he had rounded up read off and other people support ebay and i'm like no i can't wait wait wait no do you remember this we were in vegas and donahoe called and we were working on a plan and then you went and walked on through the plan do you remember this thing we were no what happened we were in vegas we were going to try to we were in vegas i can't i can't no no donahoe either called you or called me and i said you should talk to sax and you sketched out a plan for what paypal should do remember oh yeah yeah i do remember that but yeah like on saturday afternoon we sketched out this plan yeah yeah so i told john no i'm sorry i can't support you because i believe it should be spun out and so in the only two the only two people from the original paypal team who said that publicly were me and elon and we said that if you could get paypal out from under you know this you know this sort of ebay bureaucracy it could be a 100 billion dollar plus company the bar for acquisitions is extremely high like i think the the last really two acquisitions that were really done well was zuck's acquisition of what's happened instagram but since then the bar is extremely high for these conglomerates so as an example paypal was rumored to be buying pinterest and you know it there was such an incredible shareholder revolt that they had to put out a press release saying we have absolutely no interest in acquiring pinterest but what that all that did was just you know accelerate the bleeding because then people were saying wait a minute how strategically lost must you be totally that you would want to buy pinterest as and so then it and as a result the the paypal stock price has gotten absolutely yeah it was over 30 billion dollar company now it lost the entire value of pinterest basically here's the big issue that i think we have in american economics and company building you know we've gone through 20 or 30 years of really under investing in r d at the sake of share buybacks um at the sake of you know market consolidation dividend private equity you know driven take privates and so all of this capital misallocation has really put us on the wrong foot and the pandemic basically showed that we were really ill position so a lot of these um conglomerates it doesn't make sense today because we've proven that the compensation schemes for ceos the incentives for executive management are way too perverted and they just create horrible outcomes a different example i saw in the last i think 15 or 20 years ibm's market cap has gone down to 113 billion in the meantime they've bought back 132 billion dollars of stock what could you imagine the kind of r d that ibm could have affected with that 132 billion and where they could be so we have they're not they're not good capital allocators well we have horrible capital misallocation so well look at apple i mean i don't think they know how to spend the money in the r d yeah they're not they're not good at it they're not good at it they're better off they're better off taking those massive they're better off taking those massive r d budgets and putting it into m a budgets not for like a 50 billion dollar pinterest acquisition that doesn't make any sense has no synergies but on smaller acquisitions of teams that have built really interesting technologies ibm ibm could have bought a lot of different things to innovate or operate those guys don't seem to know how to do anything so like my point is now we're in the cycle where these conglomerates will get ripped apart so that a brighter fresher and probably younger group of executive management can take a different the spin on these companies and actually do some so for example like the j and j spin out is really exciting because you take med devices in pharma and you separate it from a really struggling complicated consumer goods you know package business you know the shampoo the q-tips the listerine get all that off-balance sheet now you can actually you know make drugs and med devices and that's a really interesting business that the right ceo can really do a lot of interesting things with i heard an interview with us then ceo of ge i think culp who was putting forward this plan the line that i remember that kind of resonated with me he said the benefits of focus are immediate the benefits of synergy is are hypothetical and i think that's really the key point here and that's what's going to fuel all this sort of deconglomeration is that the benefits of focus to a company are so huge that you know that but but the reason why it doesn't happen is because of this instinct that all these managers have for empire building right so when times are good they can keep building their empires and then something bad has to happen to force them to focus yes the motivation they're not they're not owners they're typically not founders and so what you end up seeing is their comp goes up linearly with market cap so the biggest right and this is just just to close the thought out on that whole ebay paypal thing i mean it was so obvious that ebay should spin out paypal but for the manager history the management resisted it and it took an activist shareholder i think icon came in this icon yeah it was icon who came here when the carolinas it's in the lobby you're [ __ ] well but but icon shouldn't have to come in there the reason why there's opportunities the managers won't do the right thing he unlocked a quarter trillion dollars of value he was incredible no i mean they spelled that out for 40 or 50 billion now it's worth five times that amount it's a quarter of a trillion dollars yeah it's crazy and just to to put this all in perspective the stock buybacks that are going on right now apple did almost 20 billion dollars less square they've done 77 billion in last year and you want to talk about the impact of tax policy on innovation well you've got on one hand here apple is is looking at well i'm gonna have to pay all these taxes i might as well just increase the amount i'm buying back and be neutral why would i want to show any kind of a profit here i'll just buy back as many shares as possible the company will eventually be private i mean this is you got to be really careful with how you do this because there's no incentive for people now to put money into r d or other stuff that just buy back the stock might be the most efficient thing to do correct in terms of like the shareholders you don't know how to spend the money it's the dumbest thing to do it basically shows you're an idiot well it shows you got nothing better to spend the money on so maybe maybe that's maybe buying back the stocks better than furring it away but yeah it means you're out of ideas it means you're not here or you or or a combination of my god this core business is throwing off so much money that we can't come up with enough ideas at that time i think that's no it just means you're not ambitious enough i mean what would you spend 20 billion on i mean zuck is having a hard time spending 10 billion on creating the metaverse a year i mean you're talking about 80 billion a year what would you put that towards what should apple put it towards no apple apple could even more aggressively double down to enter the car market they could have done it much sooner than they have they could spend 20 a year on that sure you're right you know easily um they could actually enter i don't know power they could uh yeah i mean but they're but they're you know apple their their culture is to have very few products as a company they're always very proud of that it's the steve jobs focus thing i mean i think it's worked pretty well for them i know you're second guessing it the thing that i hear i just don't like buybacks because i think it comes at the sake of r d for most companies i think it's going to be easy choice no the big tech companies are different but everybody else what you see is r d is like one or two percent of of of their you know but it's it's a shame look apple could definitely be more aggressive but i wouldn't judge the tim cook era until we see what happens with glasses because this is the product that i hear is coming is going to be their you know their ar glass glasses and that's going to be a new computing platform that they open up to developers and i guess cook's been there for what a decade but i think he doesn't want to retire until this comes out and he can see this is going to be his signature product i think but i'll tell you just the other thoughts that just went through my head as i saw this news about ge it really was kind of the end of an era you got to remember that back in the 80s 90s i think even as late as 2000 ge was the number one company in america by market cap it was the top of the s p 500 it later subsequently got kicked out of the the dow jones but the thing that went through my head is you know when i was a kid growing up the only two business names that i even knew were jack welsh and then lee iacocca you know that was it had their posters on your watch ge and chrysler in between the two of them it was big jacket well shania and now you don't even know the name of the the ge guy i mean like i know it because i watched some interview and i saw him up there but i mean you can't think of a business leader today who's not in tech and and really a tech founder or somebody who's handed the ball by the tech founder so we know tim cook because steve jobs handed him the ball but otherwise it's all tech all tech founders you don't hear about any of these old like dow jones type type companies anymore is this the the business the business environment the the economy has changed so much since the 80s and 90s it's all totally dominated by tech now but i would argue that the disruptive business and the disruptive business leader are always the icons back in the day the chemical companies were the icons and everyone knew the chemical companies and the guys running them then it was the industrial companies you know then it was kind of the financial you know then it were these guys in the 80s and 90s weren't founders you know but they were in different ways on r d spending top two companies without looking on r d in the world yeah global in the world number one number two give me number one number two uh i would say microsoft no it depends on classification but i would say saudi aramco freeburg what do you got yeah i would probably put exxon up there you guys need to think about who was been some of the most innovative leaders uh amazon 42 billion in 2020. but jason that's an accounting thing if you're saying in the world saudi arabia their exploration their enp budget is probably 200 billion dollars a year okay i i i guess maybe because that's not that's a is that is that a corporate entity technically it wouldn't be on the list it's a public company yeah so google no this is all companies samsung facebook some of this is just accounting categorization anyone who because the engineering budget is is basically what goes into rnd so the more engineers you have on staff the bigger you are doesn't mean you're producing anything by the way bigger industrial companies traditional companies that list things as r d you know most of those dollars flow out to third-party companies like enterprise software companies services businesses so it doesn't end up it gets accounted for it's quote unquote r d because they get to capitalize it but that spend is typically um uh not paying in-house salaries to engineers and that's the distinction between true tech companies and other companies that are quote-unquote going through a digital transformation or you know have a quote-unquote r d budget they're outsourcing r d and typically paying three times as much and typically getting one temp in the return um and i think that's the maybe a good heuristic for how you might kind of want to look at what differentiates detect a true test depending depending on accounting saudi aramco spends 37 and a half billion to 50 billion depending on height all right so that puts them at you know probably tied with amazon for all intents and that just means i was right jason that's what i care about well i mean i'm wondering well you know what the reason i think that you this might be obvious putting it aside i think the issue might be that they're recently public right so maybe they're uh you know they've only been filing public for two years or something all right i think that's everything uh how's everybody doing otherwise how's everybody's personal life are people losing their mind what's people's plans um for the end of kovid i'm gonna go have beer and pizza on the beach nicely done so i'm ready to get out of here nice yeah i mean i'm exhausted are you guys exhausted and this has been a [ __ ] crazy run i don't know what day it is anymore i'm like i'm ready to wind the year down i am so exhausted i mean this has been the craziest pace i've ever experienced in my life the number of deals going on the amount of inbound oh my god i tell you at that conference um every single so i have all these founders come up to me and pitch me what they're doing a couple of them like that sounds really interesting can we participate in that he's like no no the rounds are subscribed i'm like why'd you come up to me and pitch me this though how dare you like yeah so rule number one i tweeted i tweeted a new terms of service if this is only if i'm at a conference okay if you set up an appointment in my office it's fine that's like an opt-in but like if you come to me to pitch me your idea at a conference then and i say okay i want to invest like give me an allocation like don't come to me and pitch me if you're not going to give me an analogy no that's not cool that's like being like oh my god i know the best restaurant in the world it's open tonight they've got the greatest steak and they're like chasing no reservations guys tell saks about the white truffles from yesterday yeah we we had dinner at jamaat's house last night it was incredible he got these white truffles from us i've had in a year i mean it was really incredible i really appreciated it it was amazing and 2000 like it was 1996 white burgundy uh leroy i'm not a wine drinker i'm not saying that your guy your chef beat saxis from two weeks ago sax is wasn't sax's chef um your old chef uh i think one of his sessions david lives in the stratosphere he lives in a stratosphere burn that's just at a different he's next level are you eating my sloppy seconds over there no no i think we gotta beat that one i don't know that term means what you think it means anymore sex but by the way there was a there was they were gonna get there was a dinner conversation last night tax to your point jamal it's up to you to decide if you want to disclose the dinner conversation guess but um this guy said that there was a a guy that applied to y combinator that had 750 million dollars in crypto and so he's like applying to y combinator with his 750k for 150k to give up some percent of his company there's like all these stories of these guys they're like i will pre-fund my own series a with 15 million dollars to create this business inside of the yc machine that was incredible there was such an incredible like unexplicable inexplicable undescribed i think in the in the mainstream media story of crypto wealth creation that's been going on and these crypto um these crypto 100 millionaires billionaires are emerging and doing their own kind of innovation completely under the radar right the smartest people that we know are selling right now yeah and i think they changed their conversions um for the yc safe they're now getting preferred shares they used to do common and um they now i think it happens post conversion so they want their seven percent fixed you know after your next round of funding is my understanding i don't know if that's but yeah so they got it more aggressive but that's brutal it's you know what's happening is like the accelerators have to move earlier back to incubators so the idea of somebody you know grin or some of the other companies we funded coming to the accelerator with 20 000 and or 50 000 in revenue in some cases they may be able to raise money without and certainly the crypto companies are raising 25 million dollars they're outpacing regular companies regular startups non-crypto startups and they raise it in 10 seconds from a bunch of eth for buying tokens they've created a whole shadow economy yeah that doesn't have to play by any of the do you really need adventure anymore like well if you want to obey the law i guess you do but in a lot of these cases like i did this um this whole new economy could emerge completely offline right completely off the current do want to get this thing tightened up they don't want people doing this 20 i think it was 2015 i presented amazon at iris own and one of the things that i did was we calculated what bezos's investment track record was right because he basically took all his free cash flow and reinvested it in the business and you could measure what his return on uh invested capital was and it was like 42 percent and on a really big number on 10 percent on the money amazon deployed in r d projects like the kindle or 42 percent over like a multi-decade period and double what a venture firm would do or top down i mean he's in a class by itself but um my takeaway in that moment was wow this is the you know smartest investor of our generation that's what i said at bazel's at the time and you know baze has had a track record of selling roughly a billion dollars of amazon stock every year and this year he you know snap sold 6.6 billion which you know when we talk about the percentage you're selling we're talking about selling five percent 10 so you know they're not diluting their whole positions but these are big numbers you're right i think it's a signal jkl you got to close this out all right everybody it's been another amazing episode episode 55 of the all-in podcast from uh yeah whatever where you know where people are coming from uh the all-in summit we'll be in the spring at some point i'm gonna go to miami and look at the locations march 11th through 15th i can't because i'm playing poker yes okay you got your poker train in an undisclosed location big time if i can go listen is there anywhere poker big boys you need to have a funny guy there i mean i'm not a great dealer but can i be a waiter or something i mean i think the game starts at two thousand four thousand but it could get a little spicier free spicy you got a good year maybe you should go yeah maybe you should have solana play because let's get the solana chips oh he can play davidson [Applause] you put it in an llc and then you buy into the game and then that may not be enough that may not be enough all right 20 whatever 20 is enough for the queen of quinoa the dictator and rain man david sachs i'm jcal we'll see you next time on the olympics subscribe to the channel [Music] we should all just get a room and just have one big huge orgy because they're all just useless like [Music] [Music] i'm going home 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it was very interesting going to sax's kid's birthday party um freeburg and i were there for about two or three hours sac showed up for the last half hour i think i was there for i think i was there for two hours and didn't see sex and then i saw him on my way out the door but he had some youtubers there who were pretty cool yeah papa jake and logan thank you jake what's great yeah you know they have seven million followers on youtube eat your heart out jkl how many times bigger is papa jake than you business and podcasting on youtube is a new concept uh long form and long form is not what the algorithm is designed for it's obviously designed for short form and people getting to completion so getting to completion on a 90 minute video are we talking about love making again sorry welcome jesus when i say completion i it's not this we need an hr department at all in yeah i prefer the short form format for that too these are called open folks let your winners ride [Music] rain man [Music] david source it to the fans and they've just gone crazy with them hey everybody welcome to another episode of the all-in podcast it's episode 56. we've made it past 55 the show of the band is still together coming to you every friday night far too late because the rain man obsesses over every edit in the podcast with us again the all in scorsese himself david rain man sax and the queen of quinoa the sultan of science david friedberg is here and with a power sweater that cost me no turtleneck turtleneck i'm sorry a power turtleneck that cost more than your mortgage payment this month the dictator himself chamath paulie hoppetea i'm j cal it was a pretty incredible week i think we have to pander to the cryptocurrency crowd because that's just making ratings go through the roof here i am absolutely inspired by what we saw this week with the constitution dao forming in about a week and going from one or two million to 46 million dollars raised through a dow if you don't know what these decentralized autonomous organizations are it's basically analogous to a corporate structure but that's written in code so you can get a group of people together typically in the discord then you create a smart contract they collect in a wallet a bunch of eth or it's typically eth right now and then you get some kind of governance written into the dao where people get voting power they brought this together to bid on one of 13 copies of the original constitution of the united states and it was a very controversial moment last night when 80 of the money was raised in the last 48 hours and there was this crazy auction going back and forth with two representatives of sotheby's on the phone it hit 41 million dollars everybody thought that the dow had won which would have mean would have meant that almost 20 000 people who participated in this would then vote on what to do with this 41 million dollar offer coin desk incorrectly uh reported that the dow won and then the dao announced that they had in fact not some other statistics uh their twitter has 36 000 followers the group reported they needed 14 million to participate 30 million to be competitive and 40 million to have a great chance of winning they raised like i think six or seven million while they were on the air you know when the auction had started and the only uh downside to all of this is that there were huge gas fees uh people were spending 30 40 50 bucks to donate 200 which was the average size of these yeah they should have done it on solana all right so here we go talking our own book again now we got somebody's going to clip this out there's a lot of looks here we go jimoth what are you gonna do with your copy of the constitution you know what's so funny are you going to auction it back to the deck what are you going to burn it and make an nft out of it so it's it's funny uh i did buy something at these auctions uh yesterdays quite unique uh i will i will not comment on what it was but was it that turtleneck no but uh banksy oh no no i didn't i didn't no no no no no no but uh i i did so but i watched these auctions closely i guess is what i'm trying to say and i was surprised that the u.s constitution for sold so little you know for a basically like the magna carta of the best startup that's ever been created well but there's 13 of them right so on a market cap basis on a market cap basis you got to multiply by 13. yeah great 13 times 40 is still one of the originals it was the printing after the original was signed we have a 22 we've created a 22 trillion dollar a year startup that keeps compounding by 45 a year i would have thought these things would be worth you know a couple hundred million each well there's a lot of there's a lot of u.s memorabilia but yeah i mean but what i don't understand it means the u.s constitution david is not as it's not worth as much as it used to be that's well you know you got other you got you got the yeah there's a lot of documents you got the declaration of independence you got you know the gettysburg address there's i'm a dozen the tea party memo i actually think citizens united technically guys the citizens united if it was written not one time in one document uh by the supreme court that would be worth much more than 40 million because it's basically invalidated most of the constitution well here's one of the interesting things that happened here david wait david acknowledge that what i just said is true i don't even understand what you just said but i just said if you had printed the citizens united verdict from the supreme court on a piece of paper that would be worth more than 40 million it was it was like democracy 2.0 is what you're saying i don't understand why people are getting so swept up in this thing it's kind of my me neither me neither that's dead what you guys are missing is this is a a critical moment in the history of cryptocurrencies because the first three major use cases of cryptocurrency were kind of you had money transfer which is not as good as paypal or venmo or many other solutions oh jason i think what you said store of value hold on let me finish store value which is like who cares there's plenty to store value and then nfts got interesting but these dows are absolutely game-changing the ability to have 47 million dollars show up and be prepared to be deployed in 48 hours what are you saying ico you ever hear from illegal and they've been banned and people are being how is down any different i mean because dows have governance gaos have governance and it's a programmable government it's just a programmable corporate entity it is cheap if these things transfer ownership interest they will be regulated like securities of course that is a very important point and in this particular model the idea was it would all be kind of part of a non-profit and it would not be kind of there were donations in fact but there were donations and so as soon as these dials which they should and it's an incredibly powerful tool if it does actually become a security instrument then it changes everything and it is going to be that my whole thing is like it's one thing to do that outside the us first right and then it'll be crypto xus crypto investments that are going to drive this and that's why the u.s is going to be left behind here's what you're missing these dows are pushing the envelope in the same way airbnb and uber did in terms of you know bending the rules about ride sharing or renting your extra room these dows are kind of breaking securities laws they were telling people we're buying the constitution people who donated thought they were buying part of it or not so okay but here's the thing if they bend the rules like this what they showed to the sec is that there is a huge appetite for people to quickly form groups of capital at low dollar amounts to do something important or interesting in the world and americans now have a taste of that they're going to continue to have a taste of it and i think it's accreditation laws to change i disagree i think that what it showed is that this is yet another explanation of fractionalized ownership that demand existed well before dowse totally it's it exists today it'll exist tomorrow a dow was just yet another on-ramp but much like most fractional ownerships are terrible financial trades for crappy assets so was this so said differently if you're going to spend the time to open uh a robin hood or e-trade account it still matters whether you buy a share of lycos or a share of google right okay and so whether you do a dow or whether you have an llc to me it's irrelevant the underlying asset didn't make any sense had zero chance in my opinion of any meaningful appreciation and so if you really want to make something work and if you want to prove the dao then i would have hoped that they would have actually asked a few smart people hey guys people who buy art people who know crypto what are some assets that i should own because if this thing does appreciate i wonder if you'll do more to prove the questions that you just beat them out on the so obviously the value is greater than what the dow thought it was jason you're the reason why an accredited investor this is non-accredited investors who are doing this i know and that that on sophistication was clear the stupidest thing you can do if you enter an auction okay is to declare how you're going to be an underbidder so like it's basically saying hey guys you know here's my top tick and i'm willing to be and i can and so now you force these guys to be the underbidder at a dollar over there that's fine that's a mechanical issue sax what do you think well i wonder i i wonder if the reason why they chose this particular type of asset is because it's collectible and therefore it's explicitly excluded from the securities laws so basically you know that maybe maybe they're limited in terms of what they can go after because they don't want to be a security but until but but if that's the case then it does limit i think the applicability of daos right because what you want is is to create corporations that are programmable that you can have shareholder votes through the tokens yes things like that and you know basically a digital version of what they do analog in the real world with you know share certification shareholder meetings and stuff like that that nobody ever attends yeah that no but nobody ever attends these shoulder meetings and you know i get these notices of votes that are to be held nobody ever feels yeah exactly no one fills that stuff out well and people have super share super voting and so you feel like you have no say but in this case you do have a say imagine somebody had 10 000 acres of rainforest or a national potential national park and all of a sudden you pop up a dow and if the sec says you know what 500 or less you can back their money however you want hold on let me finish and they take that 500 and you get a million people to put 500 in which is completely conceivable somebody could buy 500 million dollars worth of national forests and say i'm gonna make this into a public trust to protect the environment this is uh on the brink of changing the world icos you could've done the exact same governance they had no governance that was missing hold on icos were for the benefit of the scumbags who did those grips and ran away with the money this is an organization with a predetermined governance structure this is like creating a new country or a new format for an llc that's what you're missing okay are you done yes what you're missing you're painting the optimistic scenario of what these things could do and you're correct but what's always happened in the history of humanity is these scenarios have resolved to people figuring out ways to scam other people to make money sure sure while this one looks all true let me finish without interrupting thank you but just like you know this looks like a great altruistic action we're going to go out and buy the uss constitution u.s constitution the next deal will end up being some shitty art piece that's worth a hundred grand of chamath points out they'll buy it for 10 million and everyone will lose their ass and the next 500 will look the same and that's why we have securities regulators and securities laws because in the past when these sorts of structures that weren't digitally governed and all this sort of stuff and people would go around and they would put together pools of money from other people and promise them the world and then they would turn around and steal their money and walk away we created securities regulators that could oversee and not have independent governance but have distributed governance across a regulatory system to make sure that this doesn't happen and that's the slippery slope of where this goes i'll say one more thing about the structure of this particular dao which i know can be resolved but it creates a problem in that everyone is betting or investing a fixed dollar amount without knowing how much equity they're getting and so when you say hey i'm going to put in 500 and there's currently 10 million dollars or let's say there's 10 000 in this thing it's like hey okay i've got 5 ownership in this thing if the next guy shows up and puts in ten thousand dollars you now have two and a half percent ownership in this thing and you've inflated the value of the thing you're buying and that's effectively what happened in the structure of this particular dow where the more money people put in the more they were paying and the less they were owning and you couldn't adjust that the correct structure in the future for people that do care about equity and ownership will be i want to buy one percent and i'm willing to pay a max of 500 to buy that one percent and with that rule engine which i know can be built into daos people can then structure what they're willing to bid and how much they're willing to participate in and the dow as a whole can resolve what it's willing to pay to go buy an asset and everyone can feel like they know what they're getting as they get into these things and then the third problem with this particular dow is we saw and i know it's kind of the first big one like this was the obvious point that these guys were showing the world how much they were about to go bid on this asset and if you take 46 million dollars and you divide it by 1.13 or which you know remember there's a 13 buyer's premium on this asset they showed everyone what they're going to pay and of course they lost at a dollar over they were the they were the under bidder i'll say something else the only fractionalized asset that has ever been proven to appreciate reliably are stocks every other fractionalized asset where you take something and then you divvy it up generally has been a trash burger you need to either own the whole thing yourself or if you're going to own it with a bunch of other people the only thing that's reliable are equities now that's just a historical artifact for how money has been made so i appreciate jason what you're saying which is i think actually you care about the structure because i think it has huge implications to people pursuing wealth creation for themselves for people participating in private markets but i do think that you're overblowing this one example because i don't think this showed any of that i think that this showed how unreliable and and useless ethereum is as a transactional layer for these things you know the fact that these poor people now have money stuck in a dow that they can't get out of because they would the gas fees would negate their contribution so that didn't deserve all the bumps in the room one second please you gotta hold on it didn't prove governance because as david said we had this inflationary outcome where all of a sudden i didn't know the equity that i owned the transparency worked against them because you're bidding on an asset where you were clear about the threshold max price you could pay so you had no pricing power and you had no uh opacity in in your bidding strategy so so i i think that this was a pr lark and in fact they said it started out as a joke and it took on a head of steam and so i think they felt like they had to execute what i would say is there are going to be some really amazing examples of dows this proved none of those things that the amazing ones will prove in my opinion and this will invite regulatory scrutiny faster than it will keep it away right you will see you know more of these scenarios where people get screwed out of money like they did in this particular case and i know a lot of everyone that participated in this dow i know that there's altruistic reasons who do they sue who do they sue the people who do they sue who do they go after now that they lost the 200 that they contributed yeah i mean there's there's there's no structure and i think that's part of the regulatory you know how do they get the money back i can't respond who's the person i could have actually bid for them and actually won that [ __ ] thing for half the price you know what i mean if you got anything you want to chime in no i mean well i don't know i would like to give a closing yeah why don't you go for it all right number one you're all speaking like a bunch of rich accredited investors uh we need to think about people who do not uh get to participate and what i see in my day job is people go to an equity crowdfunding site it's too arduous to allow non-accredited investors to invest it takes months and it's tons of paperwork so then what happens is the best deal flow which goes to the people who are on this podcast who are already rich we get to sweep up all the best deals because people who are founders and who have opportunities in corporations do not bother doing equity crowdfunding because the sec in their wisdom to try to protect people and they have good intent to your point freedberg has made it so arduous and painful for people that they then don't do it the founders i'm talking about this then keeps people down and when we were all poor we got to spend our money gambling or doing whatever we want with it but we all would have wanted to have when we were non-accredited the ability to place a bet on a startup and y'all are forgetting that and what's going on all of what you're saying in terms of the problems here are absolutely accurate and valid and those are what you need you need to identify through projects like this the gas fees are a problem so people can move this to solana you need to find out that they don't know how to do bidding and maybe they shouldn't say how much has been raised so that they can come in and bid more intelligently and maybe they do need to pick a better target but this is two hundred dollars per person they're you guys are acting like these people are gonna lose their shirts we agree with you i agree with you i think you agree with me i agree a thousand percent i'm a free markets guy i would love for there to be no regulation and everyone will come in and the problem is society won't let that happen and that's the point i'm trying to make it other societies have other societies if you're in the uk if you're in australia you can go gamble and you can go bet on startups there are different accreditation laws we have antiquated ones that unite the united states regulatory regime will be invoked because people will lose money and individuals will raise their hand and say i put money into a dow that i lost my ass on and enough thousands of people do that and then elizabeth warren and aoc will get on their you know their horse and they'll say let's let's fix this problem bernie sanders will say this is unfair the billionaires are taking the money from people and so i agree with you we should let people take risks we should let people lose money we should drop all the regulatory burden my point is really that i think structurally what's going to happen is there are going to be more of these things that are going to show up that will rip people off and that will heighten regulatory interest and people will come along and they'll start to clamp down on the stuff and that's that's my point okay i also think this example has nothing to do with what you're talking about i think what you're talking about jkl is laudable and we should all want that because i think that the broader number of people that get to participate in the wealth creation in tech the better but there are different ways of doing that i don't think we have to run full force and embrace the dao as the only way that that happens and i think that structurally the the demo the democratic norms inside of a dao in many ways make it much harder to govern inside a regulatory framework and it does set up a very binary decision by the sec and u.s regulators which unfortunately they're not going to go and be supportive of because the binary decision to support them would effectively negate their oversight that's right yeah they got jobs to keep too they have jobs to keep and mortgages to pay i think it's a cynical and accurate prediction that they will fight it but what you may not be aware of is that there is in the startup act from years ago they did allow equity crowdfunding they put a lot of throttling on it and now they're going to let you get accredited through taking a course or like kind of having a driver's license or a gun permit so it is conceivable that the next time a dow happens and they're trying to buy you but can you stop conflating these things together we've had iterations in the crowdfunding rules you're just trying to tag this with a doubt can you just separate it wait hold on a second can i just ask you a question can you please just describe and acknowledge that the crowdfunding rules have iteratively evolved in the absence of yes okay so just separate the two they're not the same thing they are two sides of the same coin because the taos allow a global participation in this and the capital can be formed instantly this was done in days that's what's so powerful about it it it costs tens of thousands to hundreds of thousands because they're doing equity crowdfunding this costs nothing because it was for a an ethereal superficial asset with a name that people recognized let me hold on a second now let me replace the us constitution with i don't know jason you just sent a deal a day ago what was the name of it let's just call it acme.com sure now what are people supposed to do it's not a known asset they are not known founders there may be turbulent issues inside the company that are still being hammered out what are these people supposed to do how are they entering a small bet place a small map do some research vote on it do collective research in a discord you're looking you have a bunch of researchers working for you you defended the gm you have a team your team does research and they're smart people and they get paid very well you were praising the coverage that wall street bets did on gme on this podcast 40 episodes ago you were saying how it was incredible because they were analyzing public companies who were governed by securities law they can't do that without private company yes because there are no rules that govern disclosure gamestop had very strict disclosure rules because they were public that was what allowed wall street bets to understand what was going on under the hood of gamestop it was the disclosure of the funds that the secs forced you to make that allowed people to understand the long and the short book that was building against it if if that was in the private markets that data is not obligated to be provided in the in the wild wall street bets would have had no idea so um i i think you're actually proving the opposite of what you intend which is it's the regulatory framework that allowed the retail gme position to happen great david and then uh yeah can i translate what jkl saying i think what jkl is saying is that we need to create some space here for innovation so that entrepreneurs can work out the kinks of these dowels so that one day jay cal can run a syndicate on a blockchain and fundraise that way isn't that what you're saying jkl or anybody i mean here's what i'll say you know when we do a syndicate amongst accreditation your book here in a weird way but i don't know i didn't mention the syndicate i didn't mention the syndicate.com once except for the icos as competitors to your syndicates but now you're all on the dow train icos i uh i thought were too big so i think you could solve this problem by looking at the bet size that people are allowed to make so you can just say hey the upper limit is 5k so now you've basically taken the individual cratering well because if you wanted to create a regulatory environment well because it would not get rid of the risk so you created a minimus exception so honestly guys the first 100 percent worth in one percent of another's okay so make it a percent of net worth no the first thing principle of portfolio construction is you need to be concentrated in the things you know and you need to stay away from the things you don't if you cap the upside on the amount you can invest what are people supposed to do peanut butter around 50 bets and you know what will happen jason most of those will be losers because the mortality rate in startups is super high and they'll end up with basically nothing how do they do in vegas how do they do betting about how to invest i mean i think what we're saying is that is that i mean this is where i actually agree is that the regulators should carve out enough room so that innovation can continue around this concept of dallas because who knows what they could become one day and we shouldn't we shouldn't kill this thing hold on we haven't killed anything because nothing exists and there are no rules about dallas the regulators haven't said anything i think we all agree that crowdfunding rules should get much more expansive that makes sense and with that private companies should disclose more that makes sense right we all agree with that so that you can have more disclosure and public available data so jason to your point communities can get into a discord like today if you said hey guys let's go and analyze a late stage investment in stripe what do you do blather on about it and just talk at each other there are no disclosures answer this question so now yeah so now are you supposed to are you supposed to enter carda or some other third-party platform and buy it at 120 billion how do you underwrite that very simple very simple in the startup dow concept we're talking about here you would do exactly what angel investors do which is say hey okay we had let's say this constitution now was to invest in startups okay 20 000 people put 200 in each we have a 40 million pool okay we're all going to submit ideas and then we're going to ask and invite those founders to come pitch the dow on a zoom and we'll all vote on which ones we like best and instead of you know a venture capital firm getting access to this now those 20 000 people could say you know what we're going to make 20 uh half million dollar bets and then we're going to pour the 30 million into the winners of that and that is just what i do for a living or any other angel investor early stage investor does you invite founders to come and pitch you and you place an intelligent bet just like people bet on the knicks or sadly on the jets and lose their money all the time and i like david's idea of saying hey maybe for the next two years we'll have a dow exception where you can raise you know from a thousand up to 5 000 people up to 10 million dollars and you just have to file that you're not a felon and we have some basic framework to experiment with this because you could buy you know a building that was going to be torn down like some movie theater for a community you could do non-profit stuff there's all kinds of beautiful things you could do with this instant capital formation and government structure that is programmable okay well it does relate to capital formation in the startup ecosystem here's what i'll say um you made a great point about uber and lyft pushing the boundaries and forcing the regulators to react yes you know why that happened it's because uber and lyft worked yes and it was successful and was not successful and so maybe if it is there's an on-ramp but i would say that the energy is better served in not focusing on a pr lark and probably just focusing on trying to improve the crowdfunding laws writ large which are already on the books and can be iterated upon versus an entire new body of regulation where nobody even has any idea what a starting point should be i think it's really i think it'd be very hard to get get those crowdfunding laws expanded with under the current regime it's sort of a minor miracle that they even got what they got several years ago right wasn't that what well it happened under obama when the 2008 yes the jobs act was in 2008 with the market crashing we said nobody's starting companies we're screwed here we need to get the economy going again so we're just going to allow more capital formation and so the 99 rule for llcs went to 250 and they just kind of loosened things a little bit and now their the mandate is the sec has to have a certification test for people to do private market investing and also people who work at vc firms right we have people who work for us who are not accredited they don't get to participate but they get an exception if they work at a venture firm etcetera so it's just it's probably simultaneously true that this thing was massively over hyped while also being the case that it's a worthwhile experiment that may lead to you know useful innovation in the future what i always look at when i see new technologies doing something is i just imagine if it 10x and what that would look like and if it worked and then i just 10x it one more time so what we're going to see i predict is this 40 million dollar will turn into a 400 million one in the next two years and then a 4 billion one in the next 10 and people are going to do something extraordinary they're going to do something so otherworldly changing what if a million people or 10 million people around the globe decided they were going to put money in to do a solar farm or something that would help society you can already do that jkl i mean that's like like a manager can friction someone's gotta someone's gotta manage it jacob's fantasizing about how big a sink it's gonna be yeah my syndicate is too large right now i can't accommodate everybody and it's also because of the law you could get bigger right well no the problem is you can only have 250 people in it that's the problem to death yeah we beat it to death okay anyway i'm obsessed with it fentanyl debts in the us are reaching a crisis point is that really what we're talking about i mean we talked about it in the chat you're deliberately trying to like avoid the biggest news today of the the biggest trend i get it we're gonna that's just a weird trick i'm just going straight down through the docket but if you want to jump the fence okay not guilty of all charges it happened within half an hour of us beginning to record this podcast i don't know i'm trying to keep the friedberg ratio up we had a nice strong emotional moment from freedberg he obviously is going to have something to say about fentanyl and science but okay he's going to walk off the show now to talk when you start talking podcast i'm not going to walk over the show you did last week you walked off you walked off and went you got a beverage you left for like five minutes ago i had to go pee all right fine i mean because i wanted to be during politics a kyle written house was founded that's usually when i take my break yeah exactly a third of the audience kyle written house found not guilty of all charges a 12-person jury in the kyle written house trial reached the decision uh after over 26 hours of deliberation he shot three people uh he killed two of them and he was found not guilty he was 17 at the time of the shooting he was charged with killing the two men and a third during the protest in kenosha wisconsin in august of 2020. this was during the protests uh over the police shooting of jacob blake he claims he traveled from illinois with an ar-15 style rifle to help protect businesses and provide first aid he did not cross state lines with the rifle that's one of the many inaccuracies that have been reported by the media over and over again because his dad lived there i guess he was in his dad lived in kenosha i think he went to school in kenosha he worked in kenosha you gotta understand like this is they're a few minutes apart where from his mother's house and they got and he never he never carried the gun across state lines the gun was bought from by a friend who was 18 who could possess it and it was kept at his house which is in kenosha got it he was apparently in kenosha earlier that day um and you know cleaning up graffiti at the school and checking out the downtown and then you know obviously when he went out that night then he got the gun but he didn't transport it across state lines so that that's i think one of the multiple what do you think what is your most important insight into this case and what it represents for american society and uh the justice system sex well i think that the cases become a little bit of a rorschach test of how you see america i mean there's clearly a a group of people in the i'd say the mate dominated the mainstream media announced percolated down to celebrities and figures from lebron james to to um i'm spacing but there's a lot of like celebrities who've come out putting forward this view that america that this trial somehow is um that that calgary house and white supremacists and that this not guilty verdict is an example of white supremacy in america somehow that became the narrative and um so that i think it's become i think there's like a couple levels to it one is the trial itself and what you think about the legal case i don't think that is that complicated or interesting you have here that the state was required to prove beyond a reasonable doubt that rittenhouse did not act reasonably in self-defense when three violent attackers came charging towards him that was i think a pretty tough case to make one of them had a gun too i mean this was right and so all of them had long criminal histories the first one who attacked him was daring him to what said that he was gonna kill rittenhouse the second one was bashing him over the head with a skateboard the third one was rushing towards him when rittenhouse was on the ground had a gun trained on him looked like he was gonna bring it to his head kind of execution style i mean all these i think cases if you saw the video from i mean for the first time it seemed pretty clear that he had a strong claim of self-defense so i don't think the case itself was that legally interesting the question is why it got blown up into being this like huge thing and it's really because the media wanted this so badly to be to feed into this narrative of somehow that this is you know a white supremacist violent attacker who was a vigilante who crossed eight lines with this ar-15 to go seek out trouble um to confront people at the protest and you know that case that that narrative just completely fell apart at the trial you know it's he didn't cross state lines for you know in that way he didn't you know with the gun when he went to this protest he went there it's interesting i mean he was a cadet an emt cadet he was kind of in this like junior firefighter program i'm not saying that he showed good judgment i think it was poor judgment for him to try and insert himself into that situation but i don't think he went there to kill anyone or to get into a confrontation he brought a first aid kit for you know for better or worse he thought he was going to help people and so any event the story really is about the media constructing this narrative that fell apart so quickly as soon as all the facts came out freeburg yeah i think the i read that there was um an analysis of the media and how they tried to portray this and that i think i'll build on what david said which is was really concerning like the there was they really wanted this to be a white kid who killed black people during a blm protest which was as it turned out the furthest from the truth i'll just tell you my experience when i first saw it that's what i thought i had read and i'll be really honest with you initially i was incredibly biased and my i had a violent reaction inside me of anger towards this kid because my thought was my god this white kid showed up at a black lives matter alley and killed you know three of of of my brothers you know like literally that's how i'm feeling i was so angry because they didn't really give the facts there was an example where in germany it got so out of hand that the articles were written that kyle rittenhouse had actually killed three black men or two black men and and i think that that's very dangerous because we need to have the truth and the facts so we can really figure out what's going on so that we can address what's broken we can hold people accountable and then we can move forward together and heal it but this like is the opposite of healing it just froths people up to make a lot of judgments with misinformation and i think that that's very unfair i didn't to be honest with you after i saw the facts i stopped paying attention to this case because i literally exhaled i would have been much more hurt and i would have probably paid more attention if this wasn't white on white violence quite honestly right right and i think people i think we've heard from a lot of people over when written house's testimony kind of went viral and started getting reported on there were a lot of people out there who were surprised to learn that all the victims were white that this was an example of white on white violence because it had been portrayed by the media as some sort of racial episode and um and it wasn't and it shows how the media is fueling this polarization and rage in our society by concocting these narratives which aren't true it's really that that i think is the dangerous thing i don't i didn't follow the case to know whether this kid was right or wrong but i do think if the media uses these opportunities to not just tell the facts and then race baits people on both of the left and the right and gets them frothed up they're doing a real disservice to america because i think it takes good people and it puts them in a state like me for a while at the beginning where i'm i was really angry and i didn't know how i felt and that's and i'm a lucid person you know ninety nine point nine nine nine percent yeah and so it just goes to show you how dangerous this stuff is when they can take a narrative and run with it and then there's no accountability for it um and we really have to stop and and check ourselves it just speaks to this ongoing fact pattern where the media is at a point where they are at a very much a low point in their trustworthiness their ability to fact check their ability to stick to the truth um i think it's been undone just this past week you know i think elon even tweeted out like you know he in exasperation he said where can i find like thoughtful news right he was asking twitter like what websites and and the the question wasn't that bad but if you read the answers it was really sad nobody had a good answer you know one person was like oh there's a browser extension that will show you how you know how much lying is happening inside the article and i thought to myself my god like there are browser extensions like a lyometer you know like this is insanity that that in 2021 that's what we are faced with which is very smart people all of us everybody listening normal people just you know out on the street we can all come to the right conclusion with given the facts and we're not given the facts anymore jake how do you think we're missing something here because um you you i know you you thought that this whole uh written house thing was crazy right which it was but are we missing an interview i think uh first off violent protests and violence is immoral and all of these protests whether it's blm on the left on the right they should all be non-violent there's a reason why martin luther king and gandhi you know said that's the rules if you want to come to the protest you have to be nonviolent and then i think the rhetoric that was created during the trump era and that he exacerbated and that he caused uh from a lot of his policies and the way he spoke as the leader of the free world in our country than polarized things i blame him for a lot of that and if you put a bunch of people who are on the far extremes into a situation like this and then you insert guns and you insert young people who have not developed their frontal lobes who do not have long term thinking which a 17 year old does not your long term and freebird will back me up on this in terms of science long-term thinking is something that develops in humans into their early 20s and so young people with guns in a violent situation with trump on tv during this time both good people on both sides whatever you know the borders all that stuff that he was stirring the pot on all of that eventually resolves to somebody's going to get killed whether it's on january 6 or it's a blm protest and that is why he had such a failure of leadership while he was so disgusting and horrible and loathsome because he was taking all of this heat and rhetoric up up and the person who winds up suffering in this are these stupid kids and their really dumb parents and mother who allow them to go to a protest and she could have stopped him with a gun somebody needs to stop these kids from going to a protest with a gun and i think there's a very difficult question here that can be asked and it probably is true i think that it was an open and shut case david that i mean i saw the video as well chamoth the guy puts a gun on him what are you gonna do you've got a gun this guy's pointing a gun at you whoever fires first survives it is self-defense and that's kind of undeniable i i think but i would hope that the number of people that really focus on this case look at the innumerable number of cases of black and brown people that have been killed the ahmad arbory trial is going on right now yes i'm sorry but i've seen one article in the mont arbore for every 50 about kyle rittenhouse yeah i just really hope ahmad arbory gets his fair trial and we're going to tell you straight up and let me say again brianna taylor not a single thing has still been done okay so i'm not that sympathetic to all of this talk right now because there are a lot of black and brown men and women who have been killed in this country where none of you guys care as much oh i care that was exactly where i was about to get to the question i was about to ask you to mouth is if kyle rittenhouse had been a black man and he had shot those three people what would the outcome of this trial have been would it have been the same justice system and i i don't think that anybody can answer that question and say it would have been fair justice i don't think it would have been i think the chance would be very low it means the situation would have been just just you saying it makes me want to cry okay it would not i didn't say for that reason but i it is the truth and i think that's what you know we in this country race is something that is our biggest weak point and we need to get well i mean leadership to work on a hypothetical injustice we don't know because that's a hypothetical that we can't know the answer to right now and you're ignoring the justice the injustice that's right in front of your face which is that this was a political prosecution from the beginning fueled by a media narrative that was completely bogus this is why i think david is right and we have to go to this root cause issue that we can all fix yeah you know we can't we we shouldn't debate these hypotheticals because they're hurtful like even now like you see me i'm emotional i can't think straight so let's get the hypothetical off the table because david you're right it's a hypothetical i mean this case probably should never this case had never been broad i mean as soon as you see the video if you look up the definition of self-defense okay you you just have to have a reasonable belief that your life is in danger and then you're allowed to use force and you know written house was running away these guys were attacking him they were chasing after him they had a gun trained on him they were bashing him on the head of the skateboard i don't know how any prosecutor looks at this and says we need to prosecute this so the case should never have been brought and then the media fuels this thing no but this is what i'm saying that's the thing that we can all change which is our reaction to that media portrayal the media can be held accountable for how they lie but how well people are you don't trust them and they're tuning them out and they're going and finding their own answers i mean this has been my point like i think we all get tuned up to what the media quote-unquote is and it's insane i think that's like yesteryear's news i mean those those guys have lost credibility you can see it in all the peer research and all the gallup research that um what used to be called and it's still by a lot of people called the mainstream media it's no longer mainstream and it's become kind of outskirt where people are finding their their sources of information is direct from the source from people that they know to be reliable trustworthy speakers of the truth and speakers of facts and they're getting them direct through social media platforms and other systems of self-publication and that the idea of having centralized media systems that get to have their own editorial and narrative over whatever facts quote they may be kind of gathering and presenting to us that's an old school way of doing things and i don't think we have to worry about it too much anymore whether or not individuals will resolve to truth seeking or motion seeking is the big question for the 21st century because as we've seen the media that the things that we do click on are the things that we already believe and that confirm our bias and that create an emotional incentive versus the things that may be not what we believe and not what we want to hear but may actually be factual and that's the big kind of challenging question here i think it's less about these evil media people and it's more about where are individuals going to make choices yeah i mean i'd say alternative media voices have never been more important and you know you can get a lot of them on sub stack people like glenn greenwald matt antonio garcia martinez call in the cullen app barry weiss i mean they all have a podcast by the way i couldn't help notice that the same week that this written house narrative collapsed the whole steele dossier narrative collapsed okay you had and i don't want to get too political and drag it back to the trump thing but you had you know john durham who's the special prosecutor unraveling this whole phony fake steel dossier with multiple indictments and you now have retractions by the washington post and other major publications and that whole narrative that fueled like an entire year of media coverage is completely collapsing and it's just another example of you know the media running with these narratives that turn out to be completely i hate to use the word fake but i mean it is i mean it's things in the dossier were fake but paul manafort's commenting again i would encourage everyone to stop using the term the media or even the term mainstream media and just recognize that there are specific outlets that are on their way downtown yeah these are content companies that need ratings they used to be the monopoly and they're no longer and you know they're like yesteryear's news and it's just um you know it's like complaining about you know whatever pick any industry that's been disrupted but they are and will be further disrupted by kind of direct to source fat gathering the big ultimate question is what are consumers going to choose um and that's the thing that scares me the most to be honest i i think that they can go either way you can either find better truth seeking or you can find better emotion more emotion seeking and that that's going to cause more polarization and more ugly [ __ ] well look it's it's happening right now you're right that the let's call it the corporate media the big media corporations their prestige and esteem and the eyes of american people have no and their credibility has never been lower it's gone new york times and cnn absolutely everyone's gone and people should be questioning them and stop listening to them and you have to diversify your information diet and you've got to be subscribed to some alternative journalists on places like sub stack but here's the thing that concerns me you know you've got the media narrative being dictated by msnbc and then it trickles down to lebron james and chelsea handler sorry that was the name that i forgot earlier who they were perpetuating this white supremacist narrative around cal written house by the way there was they looked at his phone his text messages everything there is no connection there's no proof whatsoever of a connection between him and white supremacy was completely made up by the media and yet these major figures in our culture who have this outsized impact we're tweeting about this and so the problem is you know like people like us diversify our information diet but there are large parts of the country that are just receiving this information and it gets basically passed down from the media to hollywood to the culture yeah and it's a photographer from tucker carlson to scott baio to the pillow guy it is fueling trump it is fueling tremendous divisiveness and polarization in our culture and i would say that you know jc brought up trump and he was a polarizing figure but i don't think he's the root cause of this polarization i think he is a reaction to it i think he is the manifestation of it is a manifestation of it and ultimately the root cause is the complete deterioration and collapse of journalistic standards in the media in the major mainstream uh corporate media i'll disagree i think trump's responsible for his own behavior and i've made this point in the past which is sex i don't know if it you make it sound and other people make it sound like in a directed editorial initiative to take things in a direction and i think that the reaction process is really about what do consumers want to consume what they choose to consume is what they sell more of and what they produce more of and that's the cycle that's driving this and you know that doesn't mean that these folks are not complicit or not making good kind of ethical decisions that could actually be argued either way but at the end of the day they're businesses that are selling content and if consumers want content of one form they're gonna choose that form okay look i i think you have a point that once a publication goes in a certain direction and starts getting subscribers there's some positive reinforcement there that has them keep pushing that direction that being said i don't think this is commercial in nature primarily i think what's going on is fundamentally ideological you saw for example the new york times they ran out barry weiss i've seen him run out of multiplayer no you're wrong on this thing because they wanted subscription no no you're wrong sex when the new york times did this they realized fox picked a side msnbc picks side and they they benefited from that by picking a side in the trump era so the new york times picked a side they went msnbc side and they got rid of the right because the right people drove away the anti-trump subscription so i think freeberg's right on this one i will say another thing to build on what you were saying before saks about the media's responsibility here we also have to think about the the cable news media's responsibility when they put these protests on wall to wall and they send people there that then inspires people to go there and you know when you do this wall-to-wall coverage across five networks and you obsess over something people are going to obsess over it and they see people out there rioting and people model other people's behavior and i think they need to think like how much coverage do we exactly have to give right now even now they're bringing out the national guard in anticipation of possibly riots and protests in research well in reaction no i don't know if it's gonna induce it but but in in reaction to this verdict in the ringhouse trial they're bringing out the troops to basically quell any you know riot before it gets started but why would that riot even happen because the people have been fed this narrative that is completely bogus and in that sense the media has been incredibly irresponsible and they're playing with fire they really are i'll say it again and we've fallen into the same trap look how much time we've just been talking about kyle written now i mentioned the mod arbory and we've just glossed over it is his trial being it's happening right no no but is it on video because that is another major issue here is when the trials are on video they should never do tv again on these trials there's never again i mean it really does in the courtroom but do not put it on tv like veranos is not allowing uh video in the courtroom and it's not getting covered to this extent and i think the video in the courtroom does drive this makes it a circus breaking news citadel ceo ken griffin outbid a group of crypto investors for a copy of the us constitution according to the wall street journal saying oh my god we knew somebody was trolling before this but now exactly i mean he was the central villain basically in that whole robin hood fiasco for payment for overflow and now he outbid the crypto crowd he is going to be enemy number one basically there is no more sophisticated market participant than ken griffin and on a silver platter this group of people unfortunately showed them their strategy and showed them exactly how to become beyond christ right you put one dollar on top of their basement what ken griffin knows ken griffin knows that now this is an object of interest that people are basically willing to pay anything for bingo he's going to buy it now and in one year he'll sell it for twice as much it's a valuable asset but by the way i want to make a point on this i disagree by the way he's uh he's a buyer he is not a seller he's going to hold okay but look markets don't work with this much transparency markets only work when people have different information than other people that are participating in the market no no no no no no no no no no no if everyone said everything that everyone else was gonna do same data but it's ruining really what everyone else needs different opinions but if everyone knew everyone else's opinion on what something is worth the market doesn't work and that's the problem here yeah so here's what i value an asset at and now if you know that you know how to play against me in the market and i hope that's what i said yeah exactly and one thing one thing i'll take note of that that i kind of realized yesterday when i was thinking about this which is this like transparency in markets leads to this inflationary problem why do you think everything that the government buys inflates because everyone already knows what the government is going to spend on that thing when the government enters into a market like health care or education or defense the amount that they're going to spend is published in a bill and congress says here's your authorized budget here's how much you're going to spend so there is no natural market force that says a bid and an ask what are you willing to pay and is there a walk away price there is no walk away price when the government is is told to go spend some amount of money and as a result the price of everything inflates to that walk away to that price to that budget can i build on that it's and that's by the way that's that's in my opinion based on everything i've looked at the primary reason for the increase in education costs because the government funds all the student loans the increase in health care um the increase in defense all of it is because the government is the customer and they tell the person that servicing them up front they tell the market what they're willing to pay and so the market just inflates to that amount and it's uh it's it's really the reason why the way that we budget things in the government as opposed to saying look this is the roi metric or this is the irr metric you need to be shooting for with this government spending it's all based on a fixed dollar amount of a budget that says here's how much you should go spend so look it's it's as i said it's actually worse than that because then the procurement process is is not is the furthest thing from a free market where you essentially have these licensed people that are allowed to provide services and so if you actually have the key critical input to making something possible you have to get bundled in through contractors and subcontractors and general contractors who each take their five and ten percent and then that's what you would that's when you have like you know and their hourly costs all balloon just a little bit just a little bit just a little bit and suddenly the balloon cost of everything matches exactly the button so the perfect example of this is the space program there was a there was a there was a rant by bernie sanders yesterday basically saying how could we have allowed jeff bezos mr bezos and mr musk to basically take over our national space program we need to test by his program we need to take it back and then somebody hold on and then somebody thought he went somebody thoughtfully went back and actually looked because again as david said everything is transparently published they went back and they actually counted how much money nasa spent in like the last seven or eight years and the number was 360 odd billion dollars yeah and then they counted how much money uh spacex had spent and it was you know if you counted revenue between seven and 11 billion totally totally and so you have this incredible disparity which speaks to this this guy space shuttle after the space shuttle was retired nasa didn't even have a way to get to space until spacex had the rockets i mean uh and think about how many people died on the space what bernie is saying which is what's i think scary to me is if you take the difference between 360 billion and seven so 300 and you know 53 billion dollars and divided by the number of people in the united states you're basically talking about a thousand per thousand dollars a person would you and i sit around a table and give bernie sanders a thousand dollars out of our own pocket i don't know to go and basically implement a uh a half-assed space program no it's unbelievable i'd rather give elon musk 10 cents which or one cent which is the the equivalent alternative or obviously this raises a really serious issue which is who is the better capital allocator of society private markets or the government and let me give you an example so today the house is voting out that reconciliation bill they've got it they're spending 2.1 trillion this is one example does one example that caught my eye is they've got 2.5 billion dollars going to tree equity whatever that is i'm sorry trading quality equity tree equity this is like tree equity i i think it might mean that like some communities i think it means that some some communities have more trees than others they gotta rectify that i don't know i mean this is like the jump the shark moment for the word equity because i think now everything is equity but but you know what what struck me about this 2.5 billion dollar number okay is that like craft ventures which i've been doing for the last four years we've raised and will be deploying a total of about two billion over call it five years into hundreds of startups that you know will pave the way for the next generation of the economy so two billion versus two and a half billion as one line item that's just a footnote that's an asterisk in this bill i mean what is the better capital allocation decision and what people have to understand is you know all this uh money that gets spent gets sucked out of the private economy somehow it either you know comes from taxes or gets added to the the uh national debt but either way it comes out of the private economy and resources that could be allocated to the next generation of of innovative companies right squandering the money like that on all these programs that no one even knows what they do uh when we're almost 30 trillion in debt is just unbelievable okay the one percent are going to be going to space and taking away the moon from the other 99 here roll the clip unbelievably this bill would provide and authorize some 10 billion dollars in taxpayer money to jeff bezos the second wealthiest person in america for his space race with elon musk the wealthiest person in america this is beyond laughable and i will be introducing an amendment to strike this provision frankly it is not acceptable it's not an issue that we have discussed terribly much but it is not acceptable that the two wealthiest people in this country mr musk and mr bezos take control of our space efforts to return to the moon and maybe even the extraordinary accomplishment of getting to the moon this is not something for two billionaires to be directing this is something for the american people to be determining yeah all the people have to be able to go to the moon before two people can go to the moon is that the idea yeah if there was a go to the moon dao it would get more [ __ ] good call back look at you this freaking hacks people would just plow money into it go to the moon down and give it all to elon musk it'd be so more people would do that than would vote to support the senate bill additionally i would like to report that stalling does not work at my lake house and amazon prime takes three to four days at my beach house on the cape and that these two companies are oppressing the three percent of the top three percent which i am not part of the one percent and some people don't have enough trees in my community there's only small trees and we want the redwoods from san francisco why do they or the hippies get the redwoods that are much taller do you guys remember uh one of our very earliest pods i made a statement which is equity is this danger word that the progressive left uses to steal power yes that we should feel unsafe we should always want equality but not equity because equity is zero sum right you know a cap table once you give somebody else equity it's dilutive to everybody else but equality is infinite you can have unbounded equality yes and when i hear these guys talk about this stuff it's so scary the second thing is i'm a little confused by what bernie's saying because on the one hand he wants to cancel the american government's effective you know support of these programs on the other hand he wants us to take back the responsibility for it but i think he must realize that it would cost 50 times more or a hundred times more he's he's not he's not he's not spending sensitive in case you haven't noticed i also think this is like virtue signaling like he was attacking bezos about like minimum wage and then bezos came over the top and like doubled it and then gave people college education that was bernie sanders platform for president was like give people free college and give people like a better 15 minimum wage bezos has done more for bernie's platform than anybody he should be thinking he should be telling people all companies should be asking like amazon no no but also actually to your point can i build on that amazon is now doing more to actually unwind duopolies and monopolies in markets than the government and the ftc is you know see this thing that amazon is now doing in the uk with visa where they basically shut visa off and people are speculating now that it's a step in this direction of amazon you know in amazon domestically in the united states they just did this big deal with a firm and so they are looking at and they there's a rumor that they may switch the amazon credit card off of visa rails and put them on mastercard rails but this is another example jason to your point of like you know bernie in the left progressive left would probably rail against the duopoly practices of visa and mastercard they can't get anything done jeff bezos has actually done more than a button presses a button and has done more now here's another one to build on yours who's doing i mean bernie sanders cares about global warming it's like one of his key issues who's donated more to bur to global warning than jeff bezos nobody nobody who's doing a hundred thousand electric vehicles for his delivery fleet jeff bezos jeff bezos took bernie sanders platform that he failed to get into office on and he made it amazon's platform here's a third example nick you tweeted this out nick or you can find this thing that i tweeted out but it was a little meme and it was it was um it was basically um tobey maguire and kristen dust right there's a meme famous upside down quit you know they're looking at each other and basically the joke is like you know every time you protested at you know to shut down a nuclear plant the resulting effect 40 years later was another 100 megatons of co2 was put into the air and it just goes to yet again another example of we virtue signal nuclear reactors and nuclear power we go and we get them all shut down it turned out that we ingested or we we uh put out as a result an enormous amount of more co2 than had to be put and then and now who's helping to step in and solve it another private citizen bill gates look if it weren't for these private companies we couldn't even get astronauts to space anymore impossible i mean like the government has actually lost the capacity to do that impossible it would it would have been impossible and who are we up against for space i mean china not just china just just china russia it's such a dichotomy between and this is like a recurring theme of the show between what the private sector and specifically and and not like the fortune 500 not those old stodgy companies are in the process of being disrupted but what the sort of entrepreneurial economy is able to accomplish versus like how stultified and calcified and incompetent the government's become i mean to your point freeburg i think sam altman uh led this the fusion energy startup healing like 500 million dollar round i mean by the time these nitwits you know in these political office figure these things out we're going to have fusion reactors aren't we is that real science is that coming close what do you think rubert i mean bill gates just did this uh what is it called terrapower announcement this week um he's got a company that he's been funding for years and they're building a 500 megawatt um uh fusion plant in um uh wyoming i think yeah in wyoming yes in wyoming and he got 2 billion from the government and 2 billion that was funded by the company and its shareholders which i think is majority owned by bill gates but it certainly uh feels and seems to me i mean look this one like we've said a lot of these infrastructure deals these big infrastructure deals for things like power and next-gen manufacturing and whatnot you know could use the could benefit from the boost of you know government subsidies or you know government shared costs to get these things off the ground over time as you get scale and reproducibility of them the cost per unit comes way way way way down um and so you know it seems to be the case that there are enough of these programs i think i know of at least half a dozen nuclear power companies that are you know in advanced stages of doing um you know first installation design right now and so it seems like this is going to be a reality i think it would be an incredible um boom to uh to clean energy in the united states and globally if we can get more of these built i mean was the staff china's building 150 nuclear power plants yeah they've commissioned 150 nuclear power plants i mean it's a no-brainer that that's what we need um in the 21st century it's the best renewable source a very small footprint very reliable it can run 24 7. uh doesn't depend on some you know sun or wind or what have you so you can plug it into a grid and so the government literally does not need to get involved in this aside from writing a check and just chopping it up fifty-fifty split the pot with bill i think there's an important role that the government can and should play here which is you know if we want to talk about what infrastructure this country needs i've said it on the last couple of shows we don't need yesteryears infrastructure we don't need last century's infrastructure new bridges and you know toll bridges or whatever nonsense is uh you know going to get inflated as a result of this recent infrastructure but what we need is next gen infrastructure and not charging stations because the free market's already there doing that um and you know not internet because the free market's already there giving everyone internet we see a thousand examples of that what we need is the stuff that the free market cannot afford to fund and stand up like next-gen nuclear power stations like biomanufacturing like large-scale on-demand 3d printing systems these are the sorts of infrastructure programs that the united states and our workforce could benefit from government subsidies to help the private force the private markets get stood up and as these things get stood up and the flywheel gets going and cash starts getting generated they can sell fund and they can grow and they can install more of these and the costs come down for the next one the things where the government is the only customer the only person buying the cost will only go up on over time whereas the things that the private market is building the cost will go down over time and in some of these cases where there's a big kind of hurdle to get over the first build or the first build cycle you know the government has an important role to play i think and so you know look i mean it's clearly not going to happen with this current infrastructure build there's a few nuggets in there that might be useful and helpful but generally speaking you're right i mean over time we want the cost of things to come down not go up and so we need the private market to play a critical role in being the majority driver you know of these kind of systems all right seems like a good place to end pete davidson is now dating kim kardashian how jealous are you jamal i'm not jealous what are you talking about a great i am i am shocked that pete davidson has dated some of the most incredible the famous popular women oh so you aren't jealous okay well i'm a little curious i gotta say i'm a little curious i mean if you put a picture of pete i mean there's gotta be something happening there let's just put it out there he's got the kevorka i'm gonna send you a link to an article i don't know what an article okay as i'm gonna remember that from seinfeld where um kramer was like you know dating all these beautiful women and it's because he explained he had the kevorka he's got a better finishing move yeah this is an article that went viral this week emily ratajkowski how do you pronounce her name yeah breaks down breaks down why women find pete davidson so attractive and so this was like you know i saw it all over twitter this week but it was all about you know what is the answer just give me the headlines i don't know it's some he's got uh super charming he's vulnerable he's lovely his fingernail polish is awesome he looks good he has a good relationship with his mom i mean i just think he comes across as a good guy might be the appeal um also they want to take care of him i think because he's got like his dad you guys are missing a more subtle non-obvious i don't know what you're talking about do explain maybe you could expand i'm just guessing it's a family this is a family show it's a family show oh my god uh no it's gonna take care of them that's what i heard from a woman said they want to like remember him but yeah i mean also kim kardashian i i think you know she just got the gen z i think she was probably going the way of paris hilton like maybe aging out of her uh you know uh celebrity and now she went kanye kind of gen x right and now she's going down to gen z she's got a whole new i mean i hate to be cynical about it but i i also you know saying this but um i was a little short donda but i've listened to donda now a couple times and my god is it guys pretty [ __ ] good i mean kanye west is one of legitimately one of the most incredible artists of of all time i mean the way his mind grows the music the beats it's outrageous i think if you give don that like two or three shots i was into late registration college dropout and 808 and heartbreaks amazing my dark twisted fantasy was probably one of the best albums i've ever created well see that's the thing is i think ridiculous with his later work like i didn't get into my beautiful dark christopher fantasy until i had listened to it ten times what are you guys talking about i haven't listened to any of this david do you know he's like is that like paul anka danny's like yeah wow saks do you listen to music actually this is exactly what's your favorite artist what's your favorite like if we found like if we listen to like your like your workout tracks so like on your like on on on barry manilow i like guy apple like what are you listening to like spotify like what do you like tucker caulson no music i don't listen to music when i work out the only thing the only time i really listen to music is when i'm like in a car or on a plane or whatever but do you have music for example like download it on your phone like if he said pull out your phone huh yeah i do you should give a couple names here yeah top three yeah honestly it's gonna be recent hits cause i just download what my kids tell me to download i understand just give me a couple albums that you've downloaded okay so where's um recently added okay so it looks to me like i recently added khalid yes okay good uh there's a gaga song uh kid leroy and miley cyrus okay okay killer roy and justin bieber great dozier cat my kid's like she's great she's great tick tock queen yeah see my kids keep me current you know you think i'm like she's great here's what i'm doing for my kids this is my new parenting strategy i was let they love listening to the 80s playlist on spotify but now i was like what who are like great seminal artists so i have them doing tom petty david bowie talking heads and bob marley and i get the whole greatest hits album and i explain to them every song and they're like totally getting into it so basically i actually know what great music is you're being self-indulgent you're focused on yourself and you're trying to make them a loser no i'm trying to get them to understand what actually really is you want your kids to walk into school and when somebody else is like hey do you like doja cat they're like no but have you listened to tom petty and the heartbreakers i've been doing i've been playing my kids my favorite artists and they and he's become their favorite artist aphex twin you guys don't know who he is yeah yeah yeah yeah yeah what about orbeez james album richard d james album is probably one of the best albums of all time and i play and my kids go friggin nuts for it now and they asked for it non-stop and i'm like oh my god i love you you're my kids it's the best thing i'm trying to get my kids into the my favorite movies and that's just too hard because movies everybody they were so too slow about this yeah getting they can't watch movies they're too slow they can't watch movies they only watch a marvel movie they can't even watch the original star wars or raiders who lost art anything where the scene doesn't cut every one and a half seconds they can't watch it it's like rage of the lost stock you're going to love this they're like this is so boring i'm like raiders of the lost ark hello boom are boring because they're like chris is terrible i remember watching his character development they they want to cut the first act how did you guys draw jaws would be like unwatchable kids he loved it did you guys ever watch like amc and you watch the old school movies of the 30s and 40s they are impossible to watch like they are so it's like watching a play you know it's like gotten more and more kind of um short form as we've kind of aged but you know that's like oh no what happened oh ok just came and took it from hockey you don't take the biscuit hockey you eating dog food you don't need a biscuit bad hockey you know those biscuits are cashmere they're really expensive all right i'm gonna i'm gonna go get my booster shot i'll see you guys later all right everybody this has been another exciting amazing episode of the all-in podcast for really gonna get search your cookies for the dictator finance champion and the sultan of science david freeburg we'll see you all next time sexy people have a wonderful time with suarez he came by last night i'm hosting miami mayor francis suarez tonight we're doing a cocktail reception fundraiser for him hung out with him and we got huge turnout i mean i tweeted this thing and we're going to have i think at least 60 people at the reception at least 20 people for dinner you're letting randos in your house from twitter have security oh they have to pay five dimes yeah yeah they have to pay but also like we kind of check everybody out one of your enemies one of your enemies will pay five dimes just to get in your house i think basically like buzzfeed paid to get in there i'd be careful we have to know who they are we've got the background there's a lot of people i mean look if we wanted to let everybody in there were at least 100 people who replied to my tweet saying i can't dm you but i want to go and open your dms for a day oh you can do that yeah francis came by yesterday with this team he was in top form he looks great he's excited about the next term all right we'll see you all next time bye bye [Music] we open source it to the fans and they've just gone crazy [Music] besties [Music] it's like this like sexual tension that they just need to release we need to get back [Music]








let's talk about the sweaters okay let david let's start with you because i love it i love it david i love that i decided to up my sweater game for chamoth this is tom ford love it tom ford tom ford the buttons are made out of endangered rhino horn we just lost a third of the audience so my sweater is a very light italian cashmere made by a company called doriani doryani cashmere uh this is this right here this right here is a little uh young calf leather very soft very soft and the buttons uh like david's uh are made from sharkton and for those of you at home who would like to spend 150 and stay warm may i recommend the marine layer you can find it on union street jacket i mean how you can also find that jacket on turk street how tilted is sweater karen listening to this sweater karen if you're listening i mean you must never reveal sweaty karen got back to me and she was like oh my god he's so tilted i think i know who she is sweater karen can kiss my brown ass oh so i jade comes home last night i kid you not she's like i i don't like you in the t-shirts i got you some sweaters and i was you know we're going to the mountains for the for the holiday and i was like did you watch the podcast about the sweater she's like no i don't listen to your podcast i was like okay fair enough um and i'm like i'm looking at these things through all these boxes and she's got this bunch of sweaters i started like what did you spend on this she said three thousand dollars i was like i'm not comfortable spending three thousand dollars on a sweater that's half a second eight of them i think that's the box the sweater came in was three thousand so i got my three quarters and i'm feeling good i'm feeling really good i feel pretty sexy and i'll be honest [Music] [Music] hey everybody hey everybody welcome to the holland podcast yes breaking into the top 50 podcasts week after week because of you the amazing audience telling your friends it's been two weeks so it's week and week all right we that's what i said week after week a week a week a week and a week the top 40 podcast episodes in the world thanks to the fans with me of course the dictator himself in a uh amazing sweater light light cashmere the consultant of science i found out from his mom she much prefers the sultan of science to queen of quinoa so that's what we're going with going forward david freeburg who had a great party uh up in um and i really enjoyed going and sacks who didn't go to beeps party or to friedberg's party he stayed home and played chess on his iphone the rain man himself david sachs welcome to the pod everybody okay you want me two new york stores my one true bestie jason calacanis it's true no that's not true i i really wanted to come but that's breastfeeding and so i couldn't come the helipad was shut down jamal couldn't land you were getting breastfed oh no it was um this great show called afterlife from ricky gervais there's literally a scene in it where a woman they work for a local newspaper that's going out of business and they're going to do local stories and the big story in town is a woman is making pudding uh incredibly delicious pudding and it's from her breast milk and they go and cover the story anyway i'll just leave it at that it's pretty amazing story do you want to know my two new york stories or not yeah let's hear it what would you say you had a helicopter story what's that helicopter story helicopter is also new york story so uh i uh went to deep dale to play golf with uh a certain well-known individual and uh we chopper we chop her back a finance individual uh media well-known political individual okay so this is not a rock and roller you do not want to step foot in a helicopter with a rocket no though but so here so here's my story which is why i i totally freaked out about helicopters and i can't this was eight years ago we played deep dill which is just you know outside new york get in this the chopper lands in the middle of thing i was like okay that's fine you know and we're going and i'm already feeling kind of skittish i don't like helicopters get to the east side heliport and eastside heliport is basically right by the east river and so the helicopter descends and one of the skis doesn't actually land on the [ __ ] oops thing and so it does a little tilty poops and then the guy comes back up and then he lands you i honestly like i i have never been more scared in my life all right that's it and i was like never again any besties it's a bestie band for life we're making a pack here nobody in [ __ ] friends it's crazy so that's why i'm on new york city last new york story was i was there two days ago or for the last couple days we're staying in the middle of the in the middle of this omicron breakout uh by the way had a beautiful dinner uh after the game draymond kevin durant me bunch of friends did you go to the game no we went to the private room at carbone it was so brutal though i have to tell you i feel so disgusting with myself i had a work dinner and i have sushi at the work dinner and then you know dratex after the game he's like hey look we're all having dinner carbon i said okay i'll head through i went to the hotel i called nat and i said i'm brushing my teeth and she said but you're going out and i said yes but if i brush my teeth i'm not going to eat a second center dinner and i thought you know and then but i made a key mistake but i didn't floss so i was unflossed but i brushed my teeth okay i show up and [ __ ] i lose it and yes wine and dessert and bread vodka it was really brutal and by 3am i stumbled home and i felt so bad because i had to wake up at like you know 8 o'clock in the morning no my first meeting was at 7 45. well congratulations to stuff hi by the way incredible no shooter of all time he's a virtuoso yeah anyways that was my that was my new york story i gained here's my here's mine i gained one kilo 2.2 pounds i gained in two days uh here's my car bone story hardest thing to hardest reservation to get in new york saks is like jake i'll need to help me a favor what's the best place in new york to do a closing dinner i'm like i got you i got my guy get my guy on the horn my guy's like okay i got you car bone friday [ __ ] night eight o'clock hardest ticket to new york you know what saks does goes dark friday afternoon 1pm he's like yeah we're not gonna make it i'm like oh my god my friend is like j cal your guy burned the carbon res that was the bird ipo i was going to take the founder out to dinner that night at carbone and then it turned into like the big group dinner with like 30 people so it moved over to by the way the the the private room which is like you know not in the restaurant but it's like a little bit on the side it only fits like 15 20 people so it's not like you can and that's that's then it's really tight how what can i ask your question what was steph's uh how did steph feel no steph wasn't there draymond kevin me benny fowler morale but just a bunch of us you say kevin kevin durant yeah kevin durant still ah friendly with uh he's honestly he's he's such a great guy i love kevin durant he really is really really really aggressive super super sensitive cool he's friends again with uh always always he was always i mean i think that when they had their blow up it was more like their brothers and it was just a little bit like when you started talking like joe pesci did did kevin durant ever start talking with joe pesci hey it's time baseball all right uh it was an eventful week on twitter we're only one week into the new twitter ceos reign jack is gone and already david sacks has been flagged it's a guy it can't be a coincidence that you were talking about them flagging accounts at the end of free speech and then pull it up on the screen everybody investors should be spending their time finding good investments not endlessly debating interest rates inflation and tax policy but that's the uncertainty washington has created it's a great tweet i like that tweet actually and then the flag the conversation from sax has been flagged some conversations can get heavy don't forget the human behind the screen do you think that this is that's machine learned or do you think that that's an editor that goes in there and actually manually flags machine learned right there i think that's a great question but what is but what is in there that actually triggers we're debating washington interest rates tax policy washington i'm not sure i'm not sure that you could build or maybe it's the ratio i don't i don't know how you would build a function that would weight this in a way where this could get flagged of all the things you could say with those words this is so benign well i think it's the kind of it seems to me this thing's trying to ward off bullying attacks on sex which i don't think saks needs to be too worried about all right because they're telling this to people who would reply you're saying it's there to protect me it's to protect you it's one of those things where they're like trying to get people to not insult you in the comments they're talking about them do you get a lot of insults and comments on your tweets oh undoubtedly but so it could just be a point this this tweets comments section was pretty benign oh right it may not be about the tweet it might be about the replies no it might be that this wasn't that hot this wasn't that hot i think your mother might be onto something you know michelle chandler got the same label around the same day for a tweet that seemed totally innocuous too so what i wonder about is you know is this labeled to protect us or is it a way is it sort of a passive aggressive way for snowflakes at twitter to like label people they don't like and sort of suggest they're vaguely disreputable i don't think it's that i don't think it's right it's a left wing it's a it's the it's the libs going after the the sacks you're powering any liberals getting obviously like left-wing people wait a second there seems to be a blanket attempt at trying to kind of mute the tone a little bit across the the debating that happens and the comments that come across in the replies and i think they're just trying to like get everyone to tone it down a bit i mean before you tweet it it'd be really interesting to know whether this was algorithmic or was editorial because i think if it's editorial it does actually i don't think it's as extreme as what david just said but it skews more in the realm of like people with an axe to grind can flag one thing over another or not right but if it's algorithmic i think that that algorithm probably just needs a lot of tweaking because it's not well anyway this doesn't it say that there's a person behind the tweet it's like trying to get people to not say it's charming the morning is charming it's trying to get you to be nice to each other it's ridiculous like your mom inserting herself and being like now remember it's it's there to suggest that there might be something wrong with the content that's being posted well you know in other words in other words the content is so triggering that you know it needs warning labels do you guys think that paternalism has a role on social networks to try and multiply the the kind of discourse being too acrimonious like i think we need some some of the transparency that jack dorsey repeatedly promised at all the congressional hearings remember when he got hauled up there he promised that they would give more transparency about the way that their algorithms worked where is that and it hasn't been delivered up they promised it now jack dorsey skipped out of town and there's a new guy in charge well we need to know how these algorithms work because they are pressing their thumb on the scale you know of debate in the marketplace of ideas by suggesting that some ideas are sketchier than others they should just put here this was algorithmically done based on they should explain it under there should be a little question mark you hope for the question mark based on the words in the thread it feels like things are getting heated here we did this with an algorithm or users reported this as a heated thread so we put this here or a human decided no we just decided yeah but you want it to be an open marketplace of ideas but the fact is it's twitter's marketplace of ideas yeah and facebook's is facebook's marketplace of ideas and at the end of the day i don't think you're going to get away from any of these centralized social networks having anything but some degree of moderation to play a role in a related thing they didn't just target sacks also chamata you didn't see this but uh they flagged one of your tweets uh just this afternoon pull it up as you can see here it's a slightly different one it says layers are for players this conversation will drift to five thousand dollar sweaters so a big warning for tremont just and for the people replying be careful this well that that that must be then that must have been human uh you know that's human energy for sure and uh this one came in or prof g another one came in for prof g so and in this case i think they're actually trying to think about uh the public good this guy is full of [ __ ] you thought jc benny would beat amazon how many how many hours of masterclass adobe photoshop did you take to to get this little joke i didn't make these my meme team did i'm convinced that there's two ways to raise your next fund in silicon valley one have one of the top 50 podcasts in the world or two have a strong meme game and i'm going for both sax now has a warning on his and this is how they put it on your profile page exactly this is crazy warning this person has interesting things to say if you if you're too interesting you get labeled now it's really crazy no i saw jake i saw jacob having too much fun with this and i'm like i gotta get in on this act you're like i need a meme team yeah if anybody out there i don't care if you're i need a comedian i'm i'm willing to pay on a pay per meme a pay-per-viral whatever it takes okay uh in a related story democrats want racial equity audits at tech companies according to the washington free beacon uh which sacks correct me if i'm wrong that's some sort of wacky right-wing uh publication uh never heard of it okay washington freebie again if instituted orders would have veto power over every product or initiative that's not an exaggeration is what the story says one proposal from house democrats would find companies 20 000 a day for not completing biennial independent racial equity audits a left-wing non-profit called color of change is pushing for these audits last week their president called for independent auditors to vet new products from tech companies before they were released in front of congress 2018 color of change successfully pushed facebook into completing an audit they called for more restrictions on trump's posts clear change itself pushed for trump to be permanently banned from the platform just so you know this is exactly the the rough version of what happened to microsoft in their doj settlement their anti-trust settlement was effectively an oversight where lawyers at the doj were the product managers and had not effectively veto right but you had to approve product features before you could push them for 10 years you know this is essentially what caused bombers rain just be so you know inaudib to do something and you'd have to go to these random folks who didn't really have the context to make a a decision one way or the other on future so i mean the idea that they would do this is a pretty it's pretty crazy i need a point of clarification here i've heard the term uh racial audits or racial equity audits my understanding of those were to understand the composure of the company uh in terms of you know the diversity in the company but this is something different this is in the product to make sure the product isn't racist can products be racist what's an example of a product being racist i don't understand what they would find let me unpack this for you okay what they are basically saying is that these big companies and for example they've called on google to conduct one of these audits they want all these big companies to conduct these audits these so-called auditors are actually political consultants who are members of the democratic party who are friends of the senators who are pushing for this they're political activists it's a gift and it's partly a griff but it's more than that because you know when you conduct an audit let's just take this word audit for a second okay you bring in a big five accounting firm and they will check your numbers according to generally accepted accounting principles gap and make sure that the numbers are what you purported them to be that is the purpose of an audit and if the auditor ever says that you've done anything wrong like you have to fix it there's no choice or you can appeal to some other auditor and have them redo the work okay according to these generally accepted principles with an equity audit what exactly are the principles that are being enforced or checked here there is no generally accepted list of equity principles that must be enforced these companies basically you have to do whatever this political activist tells you to do i mean it's essentially like bringing in a party commissar to now take over the company or at least be inside the company telling the executives and officer of the company what to do it's something that frankly the ccp would do it does feel a little like uh yeah stasi-like didn't we have all of the companies uh on their own from twitter to google to facebook release their own diversity stats years ago i think this is not more than diversity it's about equity it's about equity so let's explain the difference in what that means this is somehow how the companies run like the day-to-day life of the employees there not just the composure and the breakdown of the employees look equity equity means anything that progressives say it means we've seen on this program before how equity has dumped the shark there's now uh there's a provision in the infrastructure bill for tree equity so i mean really any disparity that occurs that progressives don't like can now be called a violation of equity and this gives them the authorization to come in there and start giving orders it's very weird that i don't understand how the product then review gets stopped meant to throttle you from a leasing product as a punitive let me give you an example so recently you know i wrote a piece called the the no buy list where i basically you had companies like paypal and some of these other financial firms were starting to deny service to customers to users based on their political affiliations and not just like people who are in you know well-known hate groups that like everybody sort of you know issues and wants to stay away from but these are people with relatively down the middle conservative you know conservative groups and they were being denied service by you know fintech firms so now i'm not saying that this is what this means but if this equity auditors tells you well look i don't think it's equitable to allow these conservative groups to you know be a user of your product well what's the company going to do they're going to have to listen to that and and that that is a plausible scenario given that it's already occurred we've all we've we've said this so many times on the pod but i just want to say it again for because i guess a lot of folks are new and listening whenever you hear equity used by a politician it usually means there's a power grab involved yeah because if you really want things to be fair you want things to be um equal meritocracy you want equality but whenever you start throwing the word equity around and say we want racial equity it's a bunch of you know a small number of people who you know basically have and live by what i you know what's often called luxury beliefs who want to judge other people who want to be morally absolutist and then who want to basically like uh you know exercise a power grab and we have to push back on that stuff because it's just a slippery slippery slope well this also seems like overbearing red tape for companies i mean if the company has no problems no complaints against it you know releases their diversity numbers like what is the point of going in and auditing them let's use let's use an example that builds on what david said let's take square okay one of the one of the most incredible things that square did was in a hackathon essentially build a cash app yeah and one of the most incredible things that happened in the cash app was that it really started to blow up in urban communities okay and it starts to normalize banking opening up bank accounts having more savings understanding you know an on-ramp into crypto you know cash app has probably done more to get black and brown people into crypto and to save money and to understand their cash than almost anybody else as as a customer almost explicit strategy and so is somebody supposed to go in there and just you know arbitrarily judge whether there's too many white people that work at square or not enough black people and so xyz thing has to change or such and such a feature doesn't actually speak to folks so you can't do it it's insanity it's like also to se to your point sax is what are the what do these people know like what is their qualification and what what's the goal right and and to build on jamaa's point if these senators so i think cory booker was the one who proposed this if these senators want those specific policies implemented in the fortune 500 let them pass a bill to do it and let all of our elected representatives vote on that bill and then we can see if it'll really if it's popular enough to pass and whether it passes constitutional muster they won't do that because these bills if they were directly concretized for international would be very unpopular so instead what they do is tell you well we're not going to do this directly we're going to put pressure on these big companies to hire one of our political friends again this like commissar-like person and empower them to tell these companies what to do so it's it's really kind of insidious what they're doing and they're kind of covering it all up with these nice sounding names i mean who could be against a racial equity audit right because yes if you're if you're against it you must be a racist and you must not believe in auditing companies right right word game you have to you just it's a word game it's it's using words that are really loaded and mean a lot to a lot of us right if i hear racism and race you're triggering it's not triggering but my ears perk up and i have i have a lot of inbuilt opinions on it that have been governed by 45 years as living as a as a brown man and so okay it stands to reason that i'm going to pay attention but on the surface if you say racial equity audit it also doesn't seem actually all that bad it seems like reasonably benign and that seems like an okay thing to do it's just that most of us then stop at that point and move on right but if you actually look at the rules again i would just say whenever political frameworks use the word we need to create more equity the outcomes are horrible for example look in healthcare you know if we have used this idea of healthcare equity health equity and we've misused it to such a degree and all we see is that now the system is so perverted it also doesn't work for the majority of people that have actually had the health care system work for it right like at the top of the pecking order has always been white men have always gotten the best care and we've always measured our health care progress in america based on the longevity of men white men you know 78 79 80 years old and then it started to degrade and people were curious what was happening and underneath it all was just a bunch of power grabs under the realm of equity we passed all these crazy laws we basically didn't do anything to really create more accountability and a cost based system and here we are so at some point when the citizenry hears that word you're gonna have to put your thinking cap on and actually take the opposite view which is hold on this is a really nice sounding word it may not be what i think it is and i got to pay attention because more than if i didn't hear the word at all anything you have uh on race freidberg representing uh south africans fundamentally i i don't think this is about race j call i think this is about power power it feels like a power grip also it feels like a little grip it feels like a little bit of a grift i know i had heard on the back channel that a lot of the people who are criticizing some big tech companies who were getting you know i'm not going to say who or under what modern sweaters sweater karen is that okay but there was a group of people who are like attacking big sur why don't karen if she has an opinion on sweater she must have an opinion on racial equity come on okay enough leave spread of caring the issue is um they would complain and create these you know basically you know twitter mobs and then they'd say oh yeah and hire us for twenty thousand dollars we'll come in and fix the problem for you so they were creating the twitter to then come in and solve the problem that's so good and i was like oh wow that is that's so brutal that's so dirty no i mean these hr consultants who've written these books like on the was it uh d'angelo or whatever on white fragility and you know how how to be an anti-racist i mean they're all making a fortune in corporate fees you know charging 20 30 000 per per gig i mean it is absolutely a racket i'm not a fan of equality of outcome i'm more a fan of equality of opportunity and i think um absolutely many many of these sorts of folks i try and identify methods to drive a quality of outcome and it inhibits the competitive forces that cause the best person the best idea the best business the best market model to win and you know i think it's easy to conflate the two when you don't really think through it but it is certainly appropriate and reasonable to make sure that folks aren't discriminated against when they apply for a job i don't think it's appropriate to then apply considerations of race and other factors when people are equally in the same job on who gets to have the chance at the bonus it is the best performer that should have the chance at the bonus and the same should be true in marketplaces and the same should be true with business um and i think that what we're really seeing is this fundamental effort to try and generate equality and outcomes um in lots of different manifestations and we're seeing it more frequently and more severely than we've seen it historically but it's not uh i don't think it's the right model and it's only going to lead to demise of marketplace dynamics and the things that cause forces for success and progress to wimp you know we we mentioned this a couple times i'll just say it again but we are about to have probably the most significant movement and questioning of equity versus equality um because i think in the next month maybe in the next two months we're going to sort of see a pretty strict opinion on affirmative action and if you talk to legal scholars the overwhelming consensus is this is gone um and you know we're gonna have to figure out how to rebuild you know what was a really important system that tried to give folks at least you know getting to the starting line in the same way but it's not gonna it's not really gonna exist in this in the same way shape or form speaking of karen's uh elizabeth warren uh was bashing elon over taxes and elon um has a twitter handle um with some followers and he responded uh elizabeth warren says let's change the rigged tax code so the person of the year will actually pay taxes and stop freeloading off everyone else unfortunately for uh elizabeth warren uh elon musk is pretty good at twitter he replied and if you opened your eyes for two seconds you would realize i pay more taxes than any american in history this year you pay which is i guess true he paid more in taxes now than any american in history as a side note elizabeth warren has a 12 million net worth and i saw that she paid no taxes on her equity holdings because she didn't sell anything which is how the tax code works and uh elon then responded uh don't spend it all at once oh wait you already did and then you know after the warm-up replies you uh really you know uh got in the zone and uh like steph curry just started draining half court shots he rationed her everything she heard her with 50 000 rupees yeah you remind me of when i was a kid and my friends angry mom would just randomly yell at everyone for no reason please don't call the manager on me senator karen elon also responded to bernie sanders uh tweet today about climate change bernie sanders said when future generations asked us what did we do to stop the climate crisis how would we answer and uh elon set and so great tweets uh but to the bigger picture did these people even know what's going on in the world no they woke up they woke up on the wrong side of the tilt bed yeah because uh in in like a 24-hour period he was the time person of the year the ft person of the year and they just went into super mega tilt mode and the buildback batter act got shelved and um well i mean you know i think we we talked about this last week but that bill is dead now i mean they pushed it to march to basically avoid a down vote nothing's going to happen david you're right we said last week wouldn't it be hilarious if elon said kill it and then it got killed well i don't i don't think that that's why the bill is dying i think the real reason is that we now see a fed posture which is actually pretty reasonable which actually says oh wait there's way too much money in the system as it is yeah you know the fed two days ago basically said we're going to see up to three rate hikes next year probably 50 basis points each so you know it's basically acknowledging that these these last you know several years we have printed way too much money and they're trying to fix the problem that they created so that's i think the real reason and then the cbo comes out and basically says the congressional budget office and says this thing is a white albatross that's going to cost way more than you guys think it will and so it puts biden in this very awkward situation which is you know on the one hand he supports powell um and you know he supports institutions or has historically like the cbo but he effectively then has to push back on both of them all in one false to try to ram this bill down people's throats and the support is i think it's crumbling and so you know to save face they basically said well we'll put a pin on this and we'll revisit it in march but you guys know what's going to happen in the next three months there's going to be some other crisis most folks will forget and it may just allow them to move on without having to actually deal with the potential of this thing getting defeated which would just be i think cataclysmically bad for exact for democrats you were on cnbc today i thought you said something really important where you said hey listen maybe if we just calm things down for a year we can you know get through i'm not sure what the exact quote was but maybe you could unpack that sentiment you had on cnbc today because i thought that was pretty important yeah well i mean i agree with what jamal said this um i mean this this bbb bill was particularly anachronistic once the 6.8 percent you know inflation print came out in other words we're in a hyperinflationary environment and here comes this bill that the cbo says if you know over 10 years would cost five trillion dollars that's the last thing we need is more money printing when you know we've got this inflationary fire out of control so i think that is why the the bill is being shelved probably not to return um i think that the larger problem that we have in the markets is that this there's a tremendous amount of uncertainty being created right now by washington we've had tremendous uncertainty over spending over taxes over interest rates and the conversations that i'm having with friends who are investors in really every asset class real estate vc crypto the conversations are all the same what's interest rates going to do what's the macro picture going to be i've never seen investors who should be focused on hey do i miss this company or buy this building or whatever those aren't the conversations it's all everyone's a macro economist now and so we're also distracted by this and so now the fed a couple of days ago finally gave us clarity i mean what they basically said is they're gonna accelerate the taper they'll end quantitative easing at the end of q1 and then we're basically gonna get explain what that means to people who don't know what they've been purchasing and why yeah i mean quantitative easing is kind of a weird term what it means is the fed has been going into the bond market and buying bonds um i think basically mortgage-backed securities and treasuries and they've been buying i think about 90 billion a month they're going to cut that back to 60 billion a month and that'll continue just to explain it a little bit more when you do that what you're doing is you're giving somebody that owns those bonds money okay so the fed prints money the government prints a hundred dollars takes that hundred dollars steps into the market and takes something from you in this case it's a bond and gives you that freshly printed hundred dollars what are you going to do well you're probably going to go and spend that you're going to buy other things and that's the cycle of inflation that quantitative easing basically creates and so when you call when you talk about tapering what that means is slowing down the money printing machine and slowing down you stepping in the market and buying assets with money that you've created out of thin air and it's up to other people to buy those assets if other people see value in them you you then are forced to find the real market clearing price yeah those those bonds are now on the fed's balance sheet and so there's a very interesting chart showing assets that are owned by the fed and it went up by something like three trillion during covid so that is the sort of monetary stimulus that's been pumped into the market over the last couple of years separately we've had something like six or seven trillion of dispending by the government so you know tremendously so that three trillion is not thrown away so we're clear we're going to get interest on that and people some number will default some of them will get paid back it's a way of stimulating the economy but we now know after this uh stemi checks and all the stimulus we did during the pandemic we don't need to put more fire or oxygen or kerosene on what we got going in this economy correct david yeah i mean we we should show that chart about how much the fed's balance sheet has grown over the last couple of years but you know the the argument i think would be the reason why they do they buy these assets is if they're buying bonds it basically means that it keeps the yield down right because if they weren't the ones buying them someone else would have to buy these bonds to keep the government funded and they might demand a higher interest rate a higher yield on the bonds so this by having the fed come in and increase the demand for the government's debt it means that the government can sell its debt more cheaply so when they stop doing that um i think you can expect that you know interest rates are going to need to rise in order to make our debt attractive to you know to bond buyers the other thing the other thing by the way that the fed did when they did that was it wasn't just government bonds that they were buying they decided completely arbitrarily at one point to start buying certain corporate debt so they own like four debt gm debt commercial that's called yeah no no no well not i mean commercial papers sort of more very fast turn short term duration but like how do you make a decision to start buying corporate bonds it's like buying corporate equities do you buy google versus facebook do you have who's the capital allocator making that decision so more importantly who's who's setting the price who's setting the price so you know these guys have been off the reservation for a long time i think it's fair to say that they were forced into action without a playbook in the middle of a once in a you know lifetime once a century pandemic fair enough and i think they actually did a pretty reasonable job but we just kept the tap on for so long yeah and now we're like dealing with this stuff trying to figure out how do we actually compensate so the idea that we would add knowing all of this so it's one thing i think if biden passed the bill five months ago six months ago because we didn't know any of this stuff but to do it now knowing that i think that it's really hard and i bet you that it's not just mansion on the democrats that are having a little bit of heartburn and second thoughts it's probably more because i suspect that they could have forced his hand really if it was just up to him but i suspect there are other democrats who are now teetering on the fence thinking i don't want my legacy to be tied to this when we're printing six seven eight percent inflation for me to basically keep the money printing machine on because it's it's insane this is like the sopranos episode where he gave him like he fronted the guy like 45 boxes of ziti and like you wake up and this guy can't pay the bill in the poker game like where can we even afford to pay this back at some point yeah look i think when when march comes around and this bill is supposedly going to be brought back off the table we're going to be into the election season in 2022 and i don't know that democrats are going to want to defend this i think there is a view on the democratic side that if they deliver enough goodies to their base then that will help them win elections but i think what helps you win elections more than delivering goodies to your special interests is for the economy to be healthy yeah and if they are sort of pressurizing this inflation situation that is i think ultimately that could backfire i think that's going to be worse for the economy frankly i think manchester is doing biden a favor because if the economy does grow by four percent next year as the fed is predicting it is and if inflation comes down because you stop printing money the way they're doing then you know i think the democrats will do better in the election if the economy is good i mean one of the reasons why they did so poorly you know in the off-year election uh a month ago is that there's tremendous economic anxiety out there people are seeing the inflation at the gas tank when they go to buy food and um you know if that continues i think they're going to do very poorly next year i wanted to like bring up this chart from fred on total assets on the fed balance sheet i think it is really interesting to look at this thing because so the fed had about a trillion of assets until 2008 okay then we had the financial crisis and they doubled it that's when the quantitative easing began i went to 2 trillion but then from roughly 2009 to about 2020 before covid somehow the balance sheet grew from 2 trillion to 4 trillion so and it had gone to four and a half and they were starting to shed assets so they were starting to get off drugs but it was still from two to four trillion between this like 2009 and 2020 period when supposedly we weren't in a crisis so you know they've continued this quantitative easing then covet hits and the amount grows from four to seven trillion just in 2020 and since then it's gone from seven to a little under nine trillion uh just in the last you know well they they they've been three trees i mean these are 20-year-olds they got to sell them well either they're going to have to sell the assets or they kind of do well well well it's not like that they basically are the are the fed is the one who bought the government debt so they're buying to call it a 10-year treasury so yeah i guess they could just wait till the the bond gets paid off but um but i guess they could do that but but now that fed has an incentive not to let the assets get toxic right so if you know the assets would get toxic if you know if interest rates go up too high that drives bond prices down and now all the assets on their books are worth a lot less yeah this is this is like the point where we have to just call it and say okay you know what let's move on meaning in the sense that like we have to go to these root causes because the money is more money is not going to fix what we're dealing with so i just put something in the group chat and i just want to get your guys's reaction to it because when i saw it it blew my mind there was a study okay that was just published a few days ago and it said the following thing children born during the pandemic have experienced a catastrophic drop in cognitive development of 22 iq points 22 yeah and when you look at it the people that were the most affected were male children and children of lower socioeconomic families but everybody was affected yet you see the amount of money that we're spending already so adding more money to something is not going to make it better if what we're spending today is basically just getting flushed on the toilet and these are the kinds of things that really matter how do you allow an entire generation of kids to to see to suffer by the way what does that show that means that teachers actually are unbelievably important so number one they should get paid a lot more okay let's just put it down there should be more of them and smaller class sizes exactly but if you if you have you know these completely screwed up incentives between you know the organizations the unions that represent these teachers and then the parents who have completely different incentives and they basically fight to never be in classroom and to not really teach this is the measurable outcome yeah the iq of our children i mean we have crucial ability their executive function their scores are going down how do they recover from that be a lot of tutoring it's gonna be a large summer school yeah i mean zoom's not gonna do it i don't think more fortnite in roblox fixes this problem no definitely not and and i feel terrible because like you know as a parent that's that was my solution right i was struggling with the zooms like every other parent and then in the evenings i was just so burnt and just feeling so beside myself in the middle of the pandemic whereas i had a no ipad rule for my kids that i broke down yep you know everybody did i mean it's like everybody you're home with your kids all day long it's not how it's supposed to work and but so the point is like this is where the government should step in and actually say okay here let me take leadership on this topic right and talk to the unions fix whatever needs to be fixed amp up the the money into charter schools do whatever you need to do but please fix the problem but randomly spending money to try to buy votes i think people see through that it just doesn't work and related to that omnicron is spreading like crazy uh new york city hasn't i'm rick omnicron omicron there is no n omicron omicron omicron yes i'll i'll learn how to pronounce it when it's gone omicron is spreading like crazy in new york city and in the uk amongst other places the nba and the nfl are seeing surges i've had a ton of people i know test positive this week you guys had that family friends crazy it's insane how many people are i know so many people in new york city related yeah and a lot of people that don't have um any symptoms so here's the chart of cases uh case of spiking but hospitalizations and deaths are flat or going down um in places where these outbreaks are occurring the uk uh charts are even starker there's a lot of anecdotal evidence everybody on tick tock and instagram and twitter young people in new york who went to cena con are saying they all got it but if you look at this what is santa con santa con is the worst holiday of the year it's a time when a bunch of young people dress as santa claus and get drunk and you have [Applause] that's what goes on everyone wears their little santa outfit and they go bar crawling so it's not sexy santa well actually i have a story about that i was san francisco you were sexy santa no i literally took my daughters out for pizza uh tony's uh in uh north beach and you know i've got my three daughters and there's all these people walking around like look dad it's santa claus like a lot of them and so there's a thousand santa claus descend on north beach and i turn around and i kid you not there are two old guys i'm talking 70 years old and they're wearing a baseball a santa hat santa boots and nothing in between literally [ __ ] naked in on the street so yeah bro you're you're so you're so demented okay you're like this like like unkey perv like every time i get those text messages i don't know what to think did you guys click on the twitter link when jason was like guys search for the folsom street fair on twitter no i can't i can't unsee what i saw i was like why is this awesome street trending i was like i thought there was a terrorist attack bro that was so brutal you you should you can't send that [ __ ] around like it's so brutal i don't click off i was like don't click on false i was like oh this is a twitter link what is it about web 3.0 not exactly uh the folsom street fair i'm gonna go ahead and say don't search for that um if you have kids around it's a little bit intense but anyway the santa calm was on saturday december 11th and so here we are five days late you know four or five days later and the stuff uh hitting if that's true it almost perfectly mirrors the original outbreak after saint patty's day in march 2020. and if you look on social media all the city md lines uh where people get tested are around the block and 30 nba players have entered the covid protocol in the last two weeks about seven percent of the league and uh we had a big question mark of would this be less more contagious it obviously is check less deadly it apparently some studies show as much as 40 times more infectious than delta um highly contagious extreme very much airborne it's going everywhere like i said last time if it does end up having low severity and low um hospitalization rate and low death rate for vaccinated or vaccinated plus boosted populations this could end up being a massive immunizing event meaning like a lot of people will develop new antibodies and resistance and you know that could be a net good thing but it's certainly the case that this is not a one strain one shot and done pandemic this is an endemic kind of circumstance we're going to be in this for a while and um you know the circumstances are one that may kind of require you know an adaptation in terms of how we live and operate and especially as it relates to things that are so important like keeping businesses open in schools um you know i think we're going to use recent memory to guide future decision making or at least politicians and you know kind of lawmakers will and they'll say hey this is what we did last time this happened and we just saw this in california where they're like last time like we told everyone going to lock down or wear masks indoors again and we're seeing that behavior again certainly it may have an impact in terms of the spread but this is highly contagious and it's going to spread everywhere and i think there's just some adaptation that maybe is going to be needed here over the long run there's no end there's no end inside there's no end in sight but uh it is less deadly and so could be mass immunizing and that has led people to think of this herd immunity potentially if there's not another variant um sacs if the nba and the nfl are learning to live with kovid and obviously when we were in miami there's no covet in austin there's no covid is everybody now just go because it seems like the politicians now whether it's in europe we're seeing the protests uh and i think we'll see them here in the united states if this keeps up australia obviously having protests as well the public has decided i think we're willing to have a thousand people die a day or a certain number of people die today to get back to normal so what what do you think the end game here is going into 22. i'll make a prediction for 2022. okay i will predict that even the blue areas of the country are going to have fatigue with all these coveted restrictions and so even the blue state governors who are addicted to their state of emergencies and their restrictions and lockdowns and closures and mass mandates even they are going to have to give them up in 2022 because the country is sick and tired of this peter pham had a really good tweet uh just the other day maybe you guys can dig it up where he had a friend visit him from texas and they've been living normally there since like july of 2020 roughly kids in school occasionally someone gets sick but they've been living normally okay it's a manageable problem and he couldn't believe peter's friend could not believe how they're living in l.a where still everyone's living in fear they've we now have a new one month indoor mass mandate thanks to you know governor newsom who still is ruling the state under a state of emergency what good is that going to do so i think you know but but but i think that some of these blue areas people are so petrified still of the virus and i think it's just because of they're the ones who have been ingesting all this fear porn coming from the media and but but i think it's gonna break i think the the finally this hysteria and panic will break it'll crest over the blue parts of the country in 2022 they're already back to normal in the red parts and especially omicron you can't stop this okay i think that's the the salient point here nothing spreading you're all going to get it look the little the little stupid vax card that you have to show everywhere to get like popcorn at a movie theater like you know in san francisco it doesn't do anything because vaccinated people can spread it too so that doesn't do anything and the mass main date doesn't do anything um you know and so none of this stuff does anything except getting a vaccine reduces the severity of the illness and losing weight and we can't have that conversations those consequences are mainly on the person who decides to do it what we have to say is we just have to tell everybody you know listen lose weight get in shape eat healthy get vaccinated get back to life that's it that's the best you can do i'm i believe everybody's going to get it we're starting to see like a real divergence in american life where and i think omicron's if we have lockdowns under omicron and really the big issue is school closures if we go back to school closures and blue states and have more of the learning loss that jamal was talking about and i bet we do whereas in red states they're still out there learning normally and they're dealing with it just like they deal with the outbreak of a flu season or cold season but they you know they're just managing it we're gonna there's gonna be we're gonna be living in two different americas but i but i don't believe this is sustainable i think eventually these governors who are holding on to their power and their restrictions are gonna lose in 2022 the ones who haven't given it up are gonna are gonna basically uh fall to a red wave in november 22. i think noosa might be the only one left school's closed i see everybody's cancelling their christmas parties jp morgan canceled that we're close we're close every christmas party's been getting cancelled um and i wonder if schools i mean teachers unions i think they got to be having a meeting right now they don't even the teachers don't even acknowledge that learning loss exists i mean decided to homeschool for the year of the pandemic and i kept my homeschool teacher for you know a couple of hours a day and uh my kids have done wonderfully and it's great to have the ability to afford to be able to do that but not everybody can have an after-school tutor let me upload this for a second okay so i'm spilling the beans on one of my predictions i'll make at the predictions episode we do but first we had covet okay then we had the overreaction to covid both politically and economically economically we pumped 10 trillion plus of spending and monetary and qe and all this sort of stuff politically we had these restrictions school closures lockdowns mandates okay i think we're about to enter a new phase which is the correction to the overreaction and i think we're already in the correction so the market's been correcting growth stock's been correcting for the last five or six weeks i now think that there was a bit of a political correction with young kid winning in virginia remember that state swung 10 points relative to a year ago and i think you'll see a further correction both political and economic in 2022 so we may not be completely passed kova but i think we are going to be past this sort of overreaction to covet what do you guys think about succession oh no i haven't seen it don't say anything jeremy strong jeremy strong let's talk about the journey jeremy strong okay jeremy strong is a weirdo uh according to a new yorker profile and there's been a huge response to it uh this profile handle kendall roy on success chandler roy who is woke and dumb and ineffective as an executive and obviously the show is modeled after rupert murdoch and fox and the kids there who are not dopey actually in the article it hinted that most of secession's co-workers dislike him due to his intensity and nothing acted and method acting rituals he won't rehearse with anybody he's in character all the time like daniel day lewis he won't get makeup whenever everybody else does because he doesn't want to reduce the energy and the buildup uh the article notes there is a fine line that strong walks between being a legendary method actor and just a complete uh the awesome networker wait can i tell you why this story was interesting to me and why isn't this you guys yeah okay so here's a guy who in many ways is a virtuoso and the reason you mean he's a he's a really good actor because i despise kendall roy on that show uh and i was wondering like is this guy just a terrible actor or is he such a good actor that i hate them yes i hate him and that's why i was attracted to this article and in it or after it so basically what happens is he's a virtuoso just i'll come back to in a second these people at the new yorker who i guess are just jealous or want to write click bait try to destroy this guy but what they didn't factor is that when they published this article all these other actors would come to his defense and do it really publicly yes anne hathaway jessica and aaron sorkin wrote a letter exactly that jessica chastain published to twitter because aaron aaron sorkin doesn't have access to social media by design and in all of it they said this is the most incredible person we've seen aaron sorkin says this guy is as good as dustin hoffman which is like this is as good as it gets so why was it interesting to me it's you have these people who are grinding and trying to perfect their craft be a virtuoso you talked about steph curry grinding try to perfect his craft just a little steph curry story as a tangent he he brought in this team where they basically started to map out all of the uh circumferences of the ring of the of the net and he practiced this summer literally trying to get it perfectly in to create this very specific kind of swish and he just kept shooting and shooting and shooting and shooting not you know all the time but every day for some number of shots trying to get the ball perfectly into the basket that is a level of perfectionism and if that's being a virtuoso that none of us can really appreciate but you see the output and we all love it he's already the goat and he's trying to outdo himself here's a different guy in a completely different theater in this case acting trying to also be really legendary and putting himself through all kinds of stuff and still not lose himself in it okay so much so that all of these other people will really appreciate how amazing he is and to me what i don't like is that then these critics who don't do anything who've never accomplished anything at all in their lives judgments feel so triggered that they have to judge him it's one thing to not have that skill i'll never be as good of an actor as jeremy strong i'll never be as good of a basketball player as death but i don't hate these people for that i'm so happy that people like this exist but there's a strain of people that exist and then you also have a and then who also have a platform yeah i was about to connect the dots for you is like look at yeah look at how the politicians feel the same way about private markets politicians social decide to try to destroy people yeah so instead what these people do is they take a shortcut they're the critics they're not in the arena okay the folks in the arena are booking wins and losses constantly but you have this you have this strain of impotent critic that doesn't actually know how to do for themselves and they somehow have a platform and then what they end up doing is cutting corners and then some subset of those start to cheat cue david well yeah it's a story that the congress back in 2012 passed a bill called the stock act to prohibit members of congress from trading on their insider knowledge based on you know based on legislative actions they're about to take and it's been widely flouted by dozens of you know representatives and senators and the problem is there's no punishment it's something like a 200 fine or something like that that gets waived in most of these cases so it's completely hypocritical because these are the these politicians like senator karen they're constantly demonizing and attacking other people to make themselves look better and then here they are they've got dirty hands um and they asked pelosi they said to pelosi well don't you think that members of congress should be prohibited from trading stocks right because their actions have such a huge consequence on them and pelosi said no it's a it's a free market it's a free market we should be free to to do that it's like huh you know i don't remember that being a defense every time you've wanted to regulate some you know industry that uh doesn't the president have to divest when they take the presidential office it's not a thing yeah so they're blind so why why would senators congress totally people be any different it's absurd that elected officials should be able to engage in insider trading it makes no sense the fed uh actually had this issue as well two um two folks on the federal reserve board resigned and then powell issued uh a whole bunch of i think new laws tried or regulations inside the fed to try to fix it and the same issue occurs with federal judges and there are federal judges that are consistently trading in the equities of the companies that are in front of them and so how can you how can you adjudicate a case there was one judge that had 130 plus conflicts trading conflicts 130 plus and he is the one that's there where at t or facebook or google has an issue i mean how can you actually assume that these folks are being impartial if that's the case and there are no consequences for this and yet you know if you're again going back to where we started somebody in the arena trying to do something you just got to think to yourself like you have critics that are bashing you you have folks that are basically flouting the law because they can and then you put these two together and it's like this is so it's kind of depressing to be honest with you you you start to lose a little bit of faith i mean this these politicians are grifters that's it and full stop i mean they're just grifting and i mean except for apparently except for bernie sanders and elizabeth warren they should just buy the companies they hate why aren't they buying amazon and tesla they would be total proponents of jeff bezos and elon musk if they did yeah in fairness to warren i've seen her tweet that she supports the banning of the insider trading by congress representatives but i don't exactly see her fighting for it uh you know as hard as she's denouncing people like elon so um look i mean it's it's characteristic of elected officials that they um what is it they see the the splinter you know in somebody you know in somebody else's eye but not the the log in their own or something like that isn't that the expression but you know who's taking advantage of this issue is blake masters who's running for senate in arizona just tweeted about that this would be the first thing he would fix if he gets elected which is to ban insider trading by elected officials and i i think it's remarkable that you know politicians as shrewd as nancy pelosi are deceiting this issue to republicans i mean i don't know why republicans wouldn't make this a major plank of their platform for 2022. nancy pelosi is i think the third or fourth richest person in congress her husband is a very sophisticated private equity investor there are these meme stocks that follow nancy pelosi's stock trading account or pretend to that were you know recently by the way banned by twitter right yeah that was yeah protecting her protecting her effectively so you know she has an incentive to not her seat of power is not necessarily the salary that she earns by being house leader but it's by translating that in a bunch of different ways and one way apparently it turns out is being an active equity investor in the market it's unbelievable that's allowed i don't know how this isn't just like an a plus fantastic issue for republicans they should make it an absolute plank of their platform here we go florida republican brian mast was late in disclosure disclosing purchase of up to a hundred thousand in stock at an aerospace company which had just testified before a committee he sets kentucky republican rand paul was 16 months late disclosing that he bought his wife bought stock in a pharma company that manufactures an anti-viral coven 19 treatment right nevada democrat susie lee failed to probably dispose more than 200 trades yeah just as much as 3 million i mean this is yeah just to be clear the violations have been on both sides of the aisle i'm not at all trying to say that republicans are better on this than democrats this is good bipartisan cooperation yeah yeah exactly i mean it's ridiculous this is the political class in washington engaging in bad behavior but but but the difference is this which is that pelosi the only leader of a party i've heard defend this is pelosi and i think this is a fantastic issue for outsider candidates really on both sides to run on well this is also something that biden can take because biden has never tried to do this stuff you know oh my god biden's got so many shady dealings and comments selling paintings to china there's a lot of rich spiders out there apparently he's got a rich brother he's got our you know paid a lot of money maybe that's true but joe biden has been really down in the middle come on be fair hunter is brilliant i mean he's selling paintings yeah but why are they buying hunter buying paints for 500 000 well i mean he's a great artist i mean a lot of people buy i don't know if you saw melania's coming out with nfts today so she's okay everybody's securing the bag now i mean if and by the way the presidential grift is always the best just as a case in point trump's spec is worth over 2 billion and buzzfeed which makes 360 million a year and i think has 102 million million cash issues he's not in office that's misstated jason trump's back his shares that he's going to be receiving are worth close to 20 billion 20 billion but he's not in office anymore so i'm not sure the shares he's going to receive oh yeah what you're counting is the market cap of the cash and trust the value of the shares that are already republican right the trump the value of the trump entity is going to be closer to 20 billion oh is that right wow that's even yeah crazier with no revenue there's more media right yeah well the sec apparently the doj sent a bunch of inquiries on this asking uh for background on the transaction because there's no business there's no contracts there's no employees it's just the whole but by the way ideas just to make sure that everybody understands this is this is a bipartisan thing as well the the ultimate bag secures the obamas got i think 50 million plus each for their book deals and they got supposedly high eight figures like 50 60 70 80 million dollars from now sorry hold on a second hold on a second when you said when you call them bag secures i was really triggered there for a second so am i supposed to take that offensively that you're saying michelle obama and barack obama secured the bag secured the bag is a term for getting the money the we're not against everybody not being able to make money uh the issue is trading on your office in a way that uh where you are trading on your insider information that your office is giving sure but i mean here or if you're selling influence if you sell a book hold on a second if you sell a book when you're out of office is that really a problem is that on the bus i wanted to point out that netflix won what was netflix's existential crisis for the eight years obama was in office anybody remember nobody remembers net neutral cares could they get would they have to pay verizon what was uh the obama's position on net neutrality they were for net neutrality netflix stock went up 40 50 x under obama it could all be a coincidence i'm just saying what the [ __ ] so you're saying it's like you're saying that this guy is lobbying payment to obama i think it's like are you serious i think it's like i mean listen the clintons were doing speaking gifts for goldman sachs at half a million dollars this is kind of my cue to go to dinner now okay so here's the mri you know the main way that winston churchill supported himself was writing books i think it's okay for politicians to write books and if because ultimately the public buys them and that's how they make money what about when the book is 50 million in the normal price for b10 that's the problem well i mean if i i guess you might have a point if the advance was so in excess of the expected sales that it raises a question of what the real motive is for the payment but i don't but is that is that what happened nobody gets paid a 50 million dollar event nobody gets an eight-figure dollar who's never made a documentary before no i mean if this book sold five million copies it still wouldn't be worth it uh let's move on to mrna so we keep our freed uh free burn factor i'm like so i'm so ready to go to dinner rick thompson gave me a wonderful bottle of wine by the way i'm going to go drink it tonight i'm so super tilted that you're you you you like it's like i mean what did i criticize the obamas yeah i can't deal with you there's a no-fly zone for you i'm super tilted i mean this is worse than sweater karen what what about the clintons can i can i uh go after their 500k speaking gigs from goldman sachs yeah that's okay yeah okay fine just don't trust the obamas but i mean jason are you are you doing exactly what senator karen did to elon which is by virtue of the fact that they're making money that you are now computing evil motors to it no it's just a disproportionate to what they should get by your assessment their assessment's the same about elon i pay a lot of money for michelle obama to do much of any i think she's a bigger deal for somebody who's never made a film on for netflix i don't think that makes sense you you said the same thing about rivian i don't know man you're projecting a little bit i i totally agree this is on the second floor i jump out the window right now yeah let winners be winners i think we should differentiate between insider trading sure bad and should not be allowed influence peddling badge should not be allowed and somebody out of office making money they're influenced oh no no not monetizing their influence and if they did that that's the problem getting paid for services is not getting paid to sell tickets or books that's if that's what it is that's fine it's disproportionate to the reality let's put it in yeah no no no jason say you like the obamas or i don't know i would vote obama for a third term okay didn't you get paid a fifty thousand dollar speaking fee recently to speak at a yes conference he did overpaid overpaid overpaid who are you trying to influence who are they paying you to influence jacal i mean honestly jacob jason jason jason you're like like 30 less than a high-end escort okay no offense oh yeah that's 600 bucks there's uh what's 30 more than 50 you're saying it's like 80 grand right i don't know 60 70 grand i didn't realize that um all right talk to us about the mrna news for cancer freeber that came out this past week so i think the article that you guys sent around was one related to an oncology treatment that uses mrna tech but i think it's what i wanted to kind of what i thought would be interesting to talk about for a second is just zooming out on mrna technology as a whole um which you know has been theorized for you know the the potential of it's been talked about for 50 years um if we talk about real quick what what rna is remember your dna your genetic code uh you know defines um the uh the printing of proteins in your cells and so every three letters of dna is as an amino acid a bunch of amino acids in it in a row form a protein and that protein has some function in your body the way that the dna gets translated into protein is through these mrna snippets so a little snippet of rna is a copy of dna which floats over from the dna strand and it floats into what's called the ribosome and the ribosomes the protein printer in the cell and there's lots of ribosomes and there's lots of rna floating around all the time and it's being copied over so some chemical triggers the expression of that gene of that sequence of dna into rna that then turns into protein and so a chemical induces the protein then the protein does something interesting and the protein has a function in your body and some of those proteins in human body can you know do bad things and some of them can do good things and so the idea has always been that we can actually use proteins as a way to modulate our health and modulate disease for example creating a protein that can attach to cancer cells and signal immune cells to come and kill those cancer cells as an example and some people have genetic problems where their dna prints the wrong protein and then that protein is malformed or causes some harm to your health and so the idea for rna technology has always been that instead of having dna be the source of truth for the proteins that get expressed in your body can we stick rna directly into cells and use that rna to trigger the production of proteins that can do specific things in your body and remember the biggest segment of the pharma market or a huge segment of the farmer market is what's called biologic drugs which are largely antibodies which are a type of protein that have some specific function but very many of these proteins are hard to get into the body and get them into the right place and get them to do the things we want to do so it would be a lot easier if we could get rna into the right cells to get those cells to make the right protein to do that thing that we want them to do so everything from cancer treatment to genetic diseases and there's rna interference and there's rna or what are called oligonucleotides that can be used to block specific bad proteins from being produced in your cells or is kind of another kind of course of treatment so making proteins that we think are therapeutic and blocking the production of bad proteins are kind of the mainstay of this idea behind rna technology and moderna was started to pursue this effort out of flagship pioneering which is an incubation shop in in boston um and they really kind of struggled for years to find the right footing of what's the right business model and the right product and the and the fda kind of struggled with improving this stuff and then boom covet hit and when covet hit it was like holy crap let's accelerate this rna technology use it for vaccines which had been in development for years and the protein that's being produced is the same protein you find on the the sars cov2 virus which triggers an immune response and builds up your immunity to that virus and now the floodgates are open and this is incredible because the frontiers in rna over the next decade could change the course of how we treat disease and change the course of um of outcomes for many diseases from genetic diseases all the way through to cancers and so we're starting to see those floodgates open i think there's now a few a handful of these uh you know uh rna interference um products that have been approved by the fda and we're now starting to see many more of these cancer and immunotherapy drugs start to get approved as rna therapies but it really i think was lit by um uh by the breakthrough with covid and everyone kind of seeing the benefit of this and the lack of side effects and we've now got i think a validation in the market and acceptance for consumers and this technology could transform the industry in the same way that genentech transformed the pharma industry with biologic drugs in the um 80s and 90s so it's super exciting and you know we can do updates regularly on our show if you guys want to talk about more of the cool stuff that's coming out but man this is going to transform how medicine is delivered and the potential of things that we can kind of treat let me ask you a question would the if we looked at the total number of deaths from covid and then the potential debt you know debts avoided or early debts or more life days added however you want to do it from mrna and the impact on cancer over the next say 30 or 40 years in other words the impact it would have on the people living today who lived through covid do you think net net uh will see that the prevention of cancers through this new technology could actually make you know uh basically the silver lining to what happened during covenant it's a good question um let me give you the counterpoint in the late 90s there was a a gene editing clinical trial that took place and they tried to uh and a patient and they and they delivered the gene editing technology via virus and so the virus goes in it spreads around and it has this this molecule that would edit the gene and and it was for genetic disease and a patient that they gave it to a young guy got this uh this virus and he actually died from it and they shut down all clinical trials for years and it was like boom that's the end so um there are a lot of scientists a lot of doctors have argued for years that that particular case caused so many lives to be lost because we lost years of progress in being able to run clinical trials during that time and get drugs to market that could treat people and you're right maybe the opposite has happened here that while these clinical trials may have taken years and years and years to get through in a normal setting perhaps the pandemic was the accelerant we needed to get more of these to market faster and millions of people whose lives would have been lost or would be lost otherwise to cancer and other genetic diseases and so on over the years to come will be safe because these therapies will get to market faster and so yeah it's it's it's a it's a great point and maybe i don't know what the calculus is between the lives lost and the pandemic versus the lives gained via these treatments coming to market faster but it's certainly a good way to think about it the the way to look at it we look at the days of life lost right and if we actually could actually predict how long somebody's gonna live and that you know extension of life i think we could come out of this ahead uh finally on our docket london breed calls for better policing in san francisco after this insane surge in crime here's the video it is time that the reign of criminals who are destroying our city it is time for it to come to an end and it comes to an end when we take the steps to be more aggressive with law enforcement more aggressive with the changes in our policies and less tolerant of all the [ __ ] that has destroyed our city we are going to turn this around this is a city that has a population of less than 1 million people an over 12 billion dollar budget the residents of the city have been extremely generous in providing us with the resources we need to make a difference and now the priorities we need to make must be to protect them must be to turn things around in their neighborhoods when you are in a room full of people i would say probably anywhere between 90 and 95 percent of folks could raise their hand and say that either their car has been broken into broken into or they've been a victim in some capacity or another that is not okay that is not acceptable sacks i thought crime was down and that everything was great and that we were going to defund the police what is happening here what's the big turnaround well it's it's exactly what i was saying that first of all i loved it i love what she said it's exactly what i've been saying for the last year and it's really great to hear her say the same types of things i started this this campaign back in january after new year's eve you had those two women uh get killed by a repeat offender who was released by chase abu dean and then as i dug into it i saw that he was doing this all the time as part of his agenda of decarceration so and you know a year later like we've talked about throughout this this whole time and the city is totally degenerated into some sort of dystopian gotham-like city uh this did feel like the beginning of a batman movie i mean it was a strong statement i thought it was great this is just the beginning of what needs to be done i predict that london breed is going to eventually butt heads with chase abu dean there is no way that he will support this agenda fixing the city she wants to increase the police presence so like you said she is going to refund the police not defund the police chase abu deen is i mean the only people he's passionate about prosecuting are police officers yeah so we have a huge problem that the police department is actually we have too few of them we're understaffed we take that job it's not just because the budget it's also because they're demoralized and they've got you know they've got this prosecutor by the way there was a case just recently where um a repeat offender bashed a vodka ball over the head of a cop and chase just announced that he's getting sent to mental health diversion instead of being prosecuted i want to what post this yeah a cop and not go to jail in the city of san francisco yes this is why the cops are demoralized so in order for london brie to fix the problem she is going and i think she's on the right track here he's got to go so here's my prediction on february 15th they are having the recall election for the education board and i predict that that board at least two of the three are going to be recalled the parents and tired are sick and tired of it they are going to be out i think that's going to embolden london breed to then support the recall of chase abu dean in the june election and and i think because he gets to pick his replacement yes exactly so that's what she's doing she basically flipped she was quiet up until this point uh and progressive left are slowly eating themselves yeah i mean i think this is self-preservation right chamoth i mean if she didn't make a change here she's going to be out of office too she'll get recalled it's not self-preservation they're realizing that these policies don't work moral absolutism didn't work on the left or the right these guys have tried in a small scale to do what a certain fraction of the democratic party has been trying to do at a national level it doesn't work overspending under policing under educating it doesn't do anything there i think there is going to be a schism i think it started after the young victory in virginia and i think it's going to accelerate throughout for the next year and especially after the red wave in november 2022 there's going to be a schism between liberal pragmatists and these extreme radical progressives i think um london breed represents she's obviously very liberal but i think she's pragmatic i think she wants to find solutions that work whereas chase boudin is a radical idiologue who will never change no matter how much evidence is presented to him those policies don't work i think um there's a simple formula the person who gets you into the mess is likely not the right person to get you out of the mess and um well said you know she she talks about san francisco having a 12 billion a year budget can you guys imagine if she was the ceo of a tech company that had 12 billion dollars a year in opex and she ran the business into the ground would the board say go ahead turn it around absolutely not the board would step in and in this case the board is the citizens of san francisco and they would say let's find the right person to turn this thing around and while she stood up and said the right things and maybe it would echo and i think you know even if it echoes within david sax's heart i'm sure it's echoing in a lot of parts of more liberal san franciscans um but i think that the apathy being asleep at the wheel and allowing the um disorganization across the departments within that city is ultimately her responsibility and i don't think that any amount of you know verbiage or action she might take at this point justifies the damage she has caused while being the leader of that city and i think that you'll and by the way i think you'll see to sax's point earlier i think you'll see the same response across the nation where folks feel like the leaders that got them into the mess that they're in locally in cities and elsewhere around this country are going to vote those folks out of office because they want to change and it's the same reason we saw folks vote trump into office and the same reason we saw folks vote trump out of office the more you want to see a change the more you're going to make a change with your political right freedberg is so so right there is a phenomenal twitter account his name is rob henderson and he's like a phd student right now i think he's in europe on scholarship you know is this this this this guy has has an incredible background which you can talk about later but rob henderson has this thing which i love which is that you know a lot of this stuff is born out of what he calls luxury beliefs right like defunding the police is a luxury belief if you're like this rich middle-class cloistered person that can sit behind a gate have armed security yada yada because you're not living in the ghetto where the byproducts of the byproduct of defunding the police are born out or decarceration are borne out or you know if you send your kid to a private school you can completely be for all these crazy radical ideas like defunding you know advanced placement defunding the gifted program because if your kid's smart you'll just pay for a tutor and you can do whatever you want those luxury beliefs exist more in the progressive left in such a small cohort of people than in any other political class that we have in america and when they get a hold of power they've now had the right to show whether those luxury beliefs can actually work the data says it doesn't okay with competence i mean how about that like just keep people safe and make the education luxury beliefs belong in sociology sociology textbooks in anthropological articles they they're they're better off and like we're beatnik smoke pot and talk about it over a glass of wine let me clean up something just so look i have no special desire to defend london breed i'm sure there are many yeah i knew that i don't know i'm sure there are many better people wearing a london breed brand sweater is that yeah look i i'm sure there are better mayors but um just i i think i think we have to sort of temper what you said based on the realities of politics in san francisco which are which are this we actually have a weak mayor the mayor can't do anything yeah we're supervisors without the boat the board of supervisors right and the soups are controlled right now by a bunch of crazies basically allies dean preston and matty hillary who are who are allies of chase abu dean okay so london breed i think wants to do some good things i think that she is more pragmatic than these idiologs i think that she could have been more aggressive and more outspoken about standing up to them however earlier okay but i think she is now doing the right thing in terms of the speech she just gave basically calling for refunding the police and we're sick of the [ __ ] and we're going to take action those are the right things to be saying right now she did the right thing in terms of supporting the recall of this school board and what i'm saying is let's give her a chance to see if she does come out of his favor of the recall of chase abu dean because i think that's where it's headed and if she gets on board with that and she shows she's pragmatic she may actually survive what are you saying if she gets out it's happening all around the country right we saw bill de blasio who was the first real progressive leftist elected to a major city he completely ran new york city into the ground now eric adams is going to go clean it up right we had glenn younkin who basically ran a centrist campaign take over virginia it's over it's over let's call it it's over centrism pragmatism enough of these extreme polar opposites okay right let let antifa and the proud boys go and make love to each other in some deserted island it's over it's done like proud boys and um what's the other group oath keepers or something they this uh woman who's gay said she's like oh you know it was rachel maddow she's like i think these are like gay activist groups aren't they like proud boys it sounds like a gay activist group i think we're seeing the the correction of the overreaction the pandemic cause what neil ferguson calls pandemic politics that we that the pandemic bred a strain of radical politics that we saw all over the country and i think on both sides and i think the country is going to come out of that did you see these idiots go to cheesecake factory and do a sit-in without their masks on and that that's their form of protest it's like we're going to go into the cheesecake factory it was a cheesecake factory protest and now it's going national with people who are anti-mass anti-vaxx they're don't want to have to show their cards or wear a mask when they walk through their seats so they're literally doing sit-ins at cheesecake factory and i was like i would protest going to a cheesecake factory i'm not going to protest any cheesecake factories well some people aren't on a diet like you jkl and they enjoy cheesecake ah well where are you at what's the number zach just give us the number what's your weight around 170. i'm 174. so i'm right i'm coming right up behind you you hear the steps you hear the sex sexy i'm going to tell you bro i love your sweater i'm going to drive to the city come to the mausoleum and make love to you with that sweater on oh my god all right everybody we'll see you next week on the lovely boys and podcasts love you besties love you sucks back at you let your winners ride rain man david sack and it said we open source it to the fans and they've just gone crazy [Music] besties [Music] we need to get mercy's [Music]








hey everybody welcome to another episode of the all in podcast and it is our year end episode it is our 2021 bestie awards this is where we give our awards for the best and worst of what happened in 2021 we did it last year kind of half-heartedly but this year hopefully we put a little bit more work into it with me again of course david friedberg uh the sultan of science the rain man david sacks and sweater jesus chamath palihapita how's everybody doing we're ready to go did anybody do their homework oh my god we are nine away from episode 69 and where we will have a special guest special guest who i've given the choice of coming on episode 69 or 420 no no no he has to do 69. he can't do 420. he can do both he can do whatever he wants the guy basically could do no wrong is he committed what about jack can we get jack on don't talk about that if you stop grinding jack yeah yeah maybe if you stop dunking on jack for no reason you insufferable sacks seriously you would suffer that enough that like i've alienated potential guests chamots alienated best now you're getting in on alienating the game it would be too much to have jack and chris dixon on together who who oh my god that is so cruel delete that no don't look at freebird i don't care about my relationship with 1816 dorsey we all know who who's the other person dick chris dixon chris dixon yeah who's that is a general partner at andreessen horowitz who runs their crypto fund oh nice it wasn't just me he's been very vocal lately about web3 why don't you guys invite the uh cfo of greylock as well while you're at it oh my god we couldn't get the uh partner in charge of human capital at excel you're getting a little bit far afield chris posted something pretty innocuous on web3 and jack jumped down his throat and same thing with biology as well i saw the c dixon quote it wasn't just me yeah jason now you're pretending you retweeted a photo of jack jumping down chris dixon's throat and saying whoa what's going on here now you're trying to pretend i love you now you're trying to pretend like he was triggered by me he wasn't triggered but he's jack after dark jack is gone wild chris dixon did did try a little misappropriation for which jack jumped down his throat basically everything in horror it's his thing they always culturally appropriate right like just like any other guy who quits his job and then goes on a ship posting rampage like did after shutting down i'm just one of his casualties there's a bunch of people he's gone i thought big jack energy was great i think he could no i think it's great ceo of twitter so he could tweet yeah he wanted to get in there no he wants to focus on blockchain clearly he he has religion on this and he believes that it's the future of the internet and he cares deeply about the democratization of access to finance and i think it would be awesome to hear his views on this i would love for him to come on and not be badgered about censorship and the role that he used to run how would you like him talking to you about you know being the ceo of zenifit's saks honestly i'm not trying to bathroom i only have one question which is the reason why he loves bitcoin is for its censorship resistance so why when he had the opportunity as ceo of twitter didn't he stand tall for resisting censorship he did david maybe he did okay so just tell us that read between the lines dude i don't think he has to answer to the twitter mob and try to say here's all the hard decisions i made that you guys didn't see you know this there's a there's the dynamics of a board and lawsuits and hundreds of hard decisions and the president inciting a riot at the capitol you're not supposed to create a list and publish it and say look at me i'm such a good boy i mean it's not reasonable i just think it's a reasonable question for me to ask yeah but the way you asked it was like isn't jack at an ashram like praying like you were full dunk mode i know that's one of your comedy writers writing those tweets for you did you get was that a punched up tweet or not it was a punched up it can't actually be [ __ ] up no it was not punched up just also funnier than you actually are that's why i'm saying that why did you have to throw my people yeah why don't you have to go to the ashram yeah why are you in canada jack has spent years trying to cultivate this like zen approach that has nothing to do with my people nothing to do nothing to do with the nostromo we're we're getting lost in the weeds here we have an award show to you guys later music introduce please welcome everybody to the 2021 bestie awards now just put in like everybody like denzel washington and you know like yeah can we edit screenshots from like the last oscar that you know everyone's in our audience okay oscars from the 80s like tom cruise getting up and cheering and whooping okay here we go [Music] [Music] there's a lot at stake here folks and we're going to start it off with biggest winner in politics a very difficult decision here sax biggest winner in politics who do you got i got eric adams the new mayor of new york city he was a huge underdog candidate he won by not being woke he rejected the you know woke sensibilities of the other democratic candidates he is a former cop who still packs a gun and he made his issues supporting the police public safety um charter schools you know as a instrument of minority advancement and he even pushed to make new york city a tech and crypto hub he is going to reverse the damage done under de blasio he won four or five boroughs of the democratic primary and overwhelmingly carried black latino precincts if the democratic party has a future after the rejection of woke it is eric adams okay freeberg who you got okay mine's a little um esoteric but my biggest winner for politics this year is the blockchain and i'll tell you why i think that the um embracing the blockchain as a technology that enables an evolution away from what folks consider to be um you know centralized control systems and ultimately uh underscores the interest of the populist notion that's sweeping over the united states is very strong and i think it's waking up politicians and it's going to wake up the political class to the fact that this system of organizing social economic and political action may ultimately evolve us away from the systems that we run today and it is a very serious threat to the current system of politics and economics and social order and i think it's starting to kind of rear its head and and politicians are starting to wake up to it and they're all thinking very deeply about what it means uh and so i would say the blockchain has really kind of created a new model for organization amongst humans that is waking us up in the political class more than anything else okay chamoth who do you got i think this is pretty obvious but i think it's glenn younkin the governor of virginia here's a guy that was a private equity executive who basically had to fade trump um but still pretend to feign that he needed his support and ran a pretty centrist you know pro-education anti-crime pro-business uh pro just individual um you know empowerment campaign in virginia which hasn't swung this way for a long time and basically uh beat terry mcauliffe and i think that this is the road map which effectively says whether you're a democrat or a republican grab into these centrist temples and run with it and you're going to get a ton of people in the silent majority who are sick of all of this fringe behavior both on the left and the right and so i think glenn younkin was a real canary in the coal mine for the political future of america all right great selection so far and a lot of diversity in the picking and so uh i went with joe manchin obviously the shadow president who was able to dictate uh what gets passed and uh build back better getting cancelled or uh cut from six plus billion down to maybe one point five billion if it ever gets true trillion rather sorry thank you um was my um hey a rising star or a foiling star after um his decision to denounce the build back better bill this year this week well you guys have to remember that the state he's from west virginia went for trump like 20 points it is a deep red state and manchin himself is a major anomaly as a blue politician hanging on in that state yeah so the democrats instead of alienating him should be thanking their lucky stars that they even have him for any votes because any other democratic politician in west virginia would have gone down to defeat a long time ago so they are lucky with that mansion can vote with them at all on anything to a layman like myself where i imagine most people who aren't aware of that kind of political circumstance he looks like a john mccain maverick kind of guy like he's coming in and saying i'm blowing this thing up and he gets all this attention i think does that light a fire for him maybe i think that's a great analogy which i think he is the democrats mccain you know he is the guy coming in there casting that very unpopular vote the single vote like mccain did on the repeal of obamacare the single vote that took that down but the reality is the republicans on obamacare didn't have a plausible alternative that's why mccain voted against that and i think here um in the same way i think manchester may be doing the democrats a favor because we can't afford all the spent new spending super interesting yeah here we go biggest loser in politics who do you got let's go in uh reverse order now chamath who do you got you go first jkl my biggest loser uh is elizabeth warren uh she wanted uh everybody to pay a lot of taxes who were in the billionaires to pay taxes she wanted to cancel them and now the largest tax bill ever paid by any american has been completed um according to a tweet from elon that he paid 11 billion dollars every program she wanted to work for and fight for has been done just not by her it's been done by the private sector she was attacking bezos for pay in factories and getting to a 15 minimum wage now amazon is regularly paying in the 20s and giving free college something her and bernie sanders were not able to accomplish in their entire careers and now she continues to dunk on capitalists entrepreneurs as the country basically says we're not interested in socialism we're not interested in this brand of politics they lost the election biden won and now uh this far left politics is i think becoming you know as as unimportant as the far right you know alt-right she's she's basically not important i'll build on your theme and i i actually just said the progressive left and the alt-right so i think that the short extremes in america have basically uh you know we've exposed them for the emperor with no clothes so you know we have tried progressive policies in cities and states in america that's failed we've tried far-right politics at the federal level that's basically crashed and burned as well and now what you see is a wave of normalcy and so you know all these chordling you know fringe classes get an extreme amount of attention because what they say is salacious or interesting but underneath there's no real substance or follow-through or real skill there's no basic understanding of anything economic policy foreign policy none of it and so they they make for great sound bites but they cannot govern and so i think the the biggest loser is the progressive left and the alt-right sax you want to go next yeah i mean very much in the same vein my choice is uh kamala harris the vice president she has a 28 approval rating uh polls show her lagging biden by about 10 points no vice president has pulled this poorly since uh dan quayle uh was the butt of every late night joke about 30 years ago and uh boy am i really dating myself with that reference what's the problem yeah exactly yeah potato a lot of viewers don't even remember what we're talking about but so the problem here is kind of what chamath was saying she harris is an equity scold the public is tired of being lectured and hectored about its woke sins and trying to compensate for that and showing you know warmth with a fake laughing cackle isn't going to reassure anybody who's just been called a white supremacist interestingly enough last year on our award show jason calacanis made the prediction that kamala will be the first female president of the united states uh just as a gentle uh reminder that we had predictions how you called him calacanis calacanis well he likes because i thought biden wasn't going to make it through the first term because he's so old and that he might not be able to function that was that was right yeah yeah that may still happen yeah i mean i think i might stand by that prediction we'll save it for the prediction show okay we'll save it for a prediction show next week we're taking no weeks off is the new rule here all right moving on oh wait i got my biggest loser oh yeah basically sorry my biggest political loser uh is um tony fauci i feel like uh this guy got totally vised out this year determinism is a trap right in his role you have to be deterministic meaning you're saying you gotta do x to get y in order to get people to take action and so you know in order determinism was needed for clarity of action to get people to take the vaccine and he said hey this is gonna you know ultimately end the pandemic and the problem with the determinism is it drives binary outcomes you're either right or you're wrong and in this case he was wrong right he said go get the vaccine the pandemic will end everyone got the vaccine and the pandemic certainly didn't end and it evolved and it became this very fuzzy gray math on where we sit today and i think as a result he completely lost credibility with a broad swath of people who otherwise would have been kind of still standing behind him because i do think he's you know he's an honest just forthright scientist but in order to drive outcomes he had to be very kind of stated and it was a bit of a trap this year and i think he got screwed so poor tony fauci i mean bless him but it was a rough year all right biggest political surprise saks what do you got what's the biggest political support yeah you know i just add to what shmoth had already said you know virginia went for biden by 10 points just the short time before younkin he secured trump's endorsement very early and quietly and kept the kept trump at bay and then he ran as a general moderate uh with the business pedigree as as kind of pointed out but there was something else going on here as well i don't think it was just centrism that would flip a blue state red it was also that issue of schools where mcauliffe had that gaffe in their final debate he said that parents shouldn't be telling the schools what to teach basically mcauliffe was sided with the the teachers unions and uh whereas younkin sided with parents and really i think voiced their opposition to crt in the schools that became the centerpiece for his closing argument and uh that's what allowed him to win win the election my biggest political surprise is joe manchin i think that he will probably be looked back on in time as our generation's paul volcker so let me explain what i mean by that you know at the time volcker was incredibly unpopular for what he did by raising interest rates to basically break the back of inflation and it really wasn't until 30 or 40 years later through the you know fullness of time that we appreciated that what he did took an enormous amount of courage because in the moment it created huge headaches and a lot of pushback and a lot of ill will and ire towards volcker similarly i think mansion is just now starting this process of just getting completely pilloried and you know people will point to a handful of elements of buildback better like child care that have now expired and those child care credits and and what it means to working families and that is true that but there are ways to solve for that by just going back and re-spending the seven trillion we already spend a little bit better um and in time the idea and the courage to not pour three more trillion dollars on this dumpster fire without getting ourselves better organized will turn out to be an enormous gift that he gave our kids a profile in courage even if we don't right now see it and a lot of people can be angry at it but that was the biggest political surprise is the desire for a politician politician because like you have to remember fed chair is elected right you're there you're in you're out but that was a surprise to me that he would go through this process and what it meant at a national level for his reputation to get to the other side yeah okay freeburg what do you got my biggest political surprise was that that insurrection crowd made their way into the capitol building i mean do you guys remember how shocking those images were yeah and what an incredible day that was i mean it was almost a year ago now and we watched on screen what felt like the crumbling of institutions that we always took for being uh we always took for granted and assumed were impenetrable both politically but more importantly physically and to see people physically break into that capitol building and cause mayhem and damage it really kind of exposed i think a nerve and it was a really kind of shocking moment a shocking day so uh you know to this day i still kind of think that that's been the biggest surprise for me of the year i you know i don't think any of us thought that that would happen both in terms of like that we let our defenses down and let people into that building like that and that there was enough of a groundswell to break their way into that building both sides were surprising and also just super disturbing to watch a bunch of elected officials cowering under tables while secret service had guns drawn in doors and also while some elected officials were kind of endorsing the behavior to some extent you know at a distance the whole thing was just shocking and i think a lot of us realize that maybe our democracy and i think i mentioned this on the show last year uh is not uh is a little more fragile uh than perhaps we uh we think it is trump was the biggest stress test ever for me uh the biggest political surprise uh was kamala harris being sidelined where is she what is she working on i thought that the democratic party was going to want to feature her showcase her with some great projects in order to maybe prep her for running if need be in 24 and certainly in 2028 and it seems like they have sidelined her deliberately and they don't believe in her which is they don't believe in the first female vice president and of color i don't think it's that i think that they think that she's not she's not they think that she's not electable and so they're hedging yeah so maybe maybe they're uh racist jacal or maybe they are saving her until after the midterms and then going to feature her i don't know what the strategy is the house i don't think it's like a fighter protecting her but if she was good enough to get to help get biden in office why isn't she good enough to uh feature now it just doesn't make sense to me uh that she was so sidelined well they did give her tests like they sent her to the border the problem is she doesn't have anything to say that's that will resonate with the american people but also be acceptable to her progressive base or her perceived her perceived progressive biggest because i actually think that she also has the ability and has in the past you know had the ability to be tough she completely has the ability to just be nails if she wants to be but again she and again maybe even biden to some degree still believe that the progressive left is the future of the party i think that most of us here think that it's a head fake and until she comes to those terms herself she's not she's going to continue to be sidelined but if she tacks back to the center and actually gets out there i think she's really capable of uh of of doing some stuff here she's very articulate she's very punchy anybody she you know she can really tell the truth but then she can also really just chuck and jive and say nothing when she wants to and that's just what's that corporal speak isn't working for her did anybody else notice freeburg sax that uh the initial reaction to manchin's vote or saying he wasn't gonna vote for this on sunday during the talk shows uh was like dunking on him oh my god he's horrible and then immediately monday they were trying to reconcile with him and say hey let's have a reasonable discussion about this we value your opinion as a partner well it was this weird emotional reaction like i got this email i forwarded to you guys from i'm talking about yeah and it's like crazy in that email like in that in her press release or whatever that email that she sent to us a bunch of us got it i mean jen's going crazy yeah it's hysterical it was such a cya by the administration like they wasted everyone's time for six months pushing this bill forward without checking to see if the swing votes would go for it so then the swing votes don't go for it the bill fails and they're blaming those fights i think it's that they just ignored what the swing votes were saying he's been saying from the beginning it's too big his number was 1.5 and they just said you know what we'll wait till the end and then try to high-pressure him or something or flip him at the end it doesn't make sense it doesn't make sense to push for that big a bill when it's a 50-50 senate they should have gone for something smaller and more reasonable either either that or they should have made a better calculation on inflation because again the minute that we had these big inflation prints and the fed basically changed their tapering posture that was the bullet in the gun and you basically handed manchin a loaded weapon and said here you go do what you will it was a terrible betting strategy by the republicans well he warned them he warned them that he was very worried about inflation and they were saying it was transitory and then he turned out to be right right all right biggest winner in business free broker you got biggest winner 2021 my biggest winner in business um goes back to the gamestop days and i think it was the retail investor class you know they were always there to trade on the wings and in the wake of the institutions and the markets prior to i think what took place this year and after what happened this year where they were able to coalesce and organize to make trades that move the market against institutions in a really meaningful way and broke several institutions in the process it highlighted that retail has power retail can organize and retail in aggregate can act to be a stronger force in the markets than institutions and so the retail investor is my biggest winner uh for 2021. who's your biggest winner chemath in business i mean this is pretty obvious it's elon musk you know as a former owner of tesla as a current shareholder of spacex uh as somebody who sold him a company this year david and i did to see him work is magical uh absolutely magical and uh i think that this guy you know you know there's there are these impresarios who just have these virtuosos who have these moments where they're just in the zone yeah uh and he's in the zone he's in his zone of mastery and to see a guy like that execute i think is a privilege so he's my if not elon who would you have because it's pretty obvious it's elon so did you have a second place consideration i would actually probably double down with what friedberg said i do think that there was um it's more sort of what i would say is the outsider class versus insiders i think that whether it's blockchain or web 3 or nfts or gamestop this was the year you know the constitution dao this was the year that loose affiliations of individuals um could compete on a level playing field with organized capital and i think that that's a really important trend for the future saks uh who do you have uh biggest winner in business if it is elan who's your runner-up yeah so i mean can't fault the elon choice is pretty obvious um but i would say in our world the biggest winner was tiger global um they basically productized growth stage capital by far the biggest deployer of late stage funding they productized it so pretty much founders can just send their metrics on like a single sheet of paper and they get a term sheet within two days they did by far the most deals uh it's really the soft bank strategy done right that's a great pick 15 billion uh i think it's the amount they deployed this year i don't know if you guys heard that number but yeah yeah uh in a single year to invest 15 billion and assume a five-year fund you know you're at a 75 billion dollar run rate it's pretty incredible i mean it really is the size of vision fund um and uh i heard i don't know if you guys heard but they are heavily dependent not dependent but they've built infrastructure with third parties who source all this data for them uh to really kind of measure everything prior to making investments so they've built a machine it's amazing uh my biggest winner in business is the ang not the fang drop the f and go with the ang amazon has a new ceo and they haven't missed a beat apple is about to hit 3 trillion and susan wojecki and youtube if you don't know is now at 2 billion users 30 billion in revenue and this of course is after elon because that's the obvious choice so after elon alphabet stock up 66 percent apple stock up 31 you guys know what's going on with those big companies so i'm gonna go with the yang biggest loser in business the biggest loser in business who do you have freedberg who's your biggest loser well i went i went the opposite of my biggest winner i went for those institutions that that you know got their lunch eaten by retail uh gabe plotkin and you know he lost so much money shorting gamestop against these guys uh buying gamestop to the moon he had to borrow 2.75 billion dollars from citadel and 0.7.72 just to get through his month uh i mean talk about embarrassing uh talk about reversal of fortune you know he's obviously been a renowned investor prior to this um and you know there's a few others that that were you know casualties of war white square a firm in london shut down half a billion aum um so all these folks who tried to bet against retail during the gamestop saga and since um thinking that the world was the way it used to be it had to kind of change it's amazing that that and the insurrection both happened in this year like time is more this year is insane yeah it's been incredible all of this happened in this past year it's crazy to think about we were here and i was up in tahoe uh skiing and all this stuff was breaking it was crazy that time that was actually our record episode when all and had that breakout episode who do you have for your biggest loser david sacks i have chinese billionaires who are the biggest loser this year if you guys remember yeah exactly a year ago we were all asking where is jack ma well he eventually turned up looking very thin and kind of broken but his experience was just an early sort of manifestation and sort of a canary in the coal mine of a larger ccp crackdown on all chinese billionaires and the ccp really seems to be increasing its control and putting these people under its thumb and there are a bunch of tech companies there like alibaba dd tencent baidu jd.com they've all been targeted for fines and tighter controls uh and china's pretty much shut down the foreign ipo market for their tech companies they've banned moving it to hong kong right i mean yeah exactly they're the ccp has basically brought all the billionaires under their thumb wow chamoth who do you have and this is amazing just so the audience knows we do not reveal our choices until yeah yeah it's really which makes it so great yeah i love hearing some of these things it makes me think for sure um yeah my my biggest loser is big tech um if you look at this year and you annotate it not for their stock price but for uh what i think is sort of the the precursor to longer term success there is a lot of signs that there's pressure building so whether that's measured in lawsuits fines uh bad pr if you put all of that stuff together i think the thing that that drives is decaying morale and when you have decaying morale you have human capital flight so people leave there are some articles just recently even about you know an exodus that you know uh novi novi i don't know how to pronounce it the cryptocurrency business of meta it's just a really really difficult thing to deal with when folks start walking out the door because they're just bummed out from working there and if you just and if you just you know google search the the number of issues that all of these companies collectively uh are dealing with i think that this is sort of peak uh big tech market cap is probably within the next year or two interesting uh this is just so great that we all had different choices um i picked the ang as the winner um i'm picking the f in fang as the loser meadow was a complete flop it was a stupid idea to change the name of the company the product they showed in that big tip off was like every science fiction movie we've seen for the last 30 years the leaks the apple wins against their ads uh the political headwinds and my last point is exactly chamat's last point which is no one wants to work there it's becoming more and more difficult if you're in silicon valley or you're a tech executive to see a reason to go work at that company i think that their vr efforts ar efforts will be beaten handily by apple and by the metaverse and you know open source slash decentralized solutions i think the f in fang should be replaced with the t of tesla and b tang facebook uh meta traded up 25 this year jacqueline listen i do think it's a juggernaut and when things go wrong it does take a while so these are forward-looking if people are leaving now maybe you'd see the impact of that in three four five years but i would not buy the stock i'd buy the other three letters i would buy the tang but not the f and fang but i think it's a good counterpoint yeah these things take a while to unravel well i think you know i think that the bet the better trade is pick the one that you love in fang and short the one that you hate and fang and if you get that right you can make a lot of money pretty soon big spread there right the spread trade like we talked about uh all right biggest business surprise what do you got saks what's your biggest business surprises i thought the biggest business surprise was tech leaders and startups moving to miami its emergence from really nothing in the tech scene to being a major tech hub it was just a year ago one year ago last december that delian sort of mused on twitter about hey can we just relocate silicon valley to miami the miami mayor francis suarez jumped in he responded how can i help and then since then it's just been snowballing and as san francisco has basically been sliding into what it's become miami just keeps blowing up and it helps i think what's been happening on the state level there that um desantis has kept the state open for business and he's kept schools open and of course the tax rate is zero uh the income tax and the capital gains tax that is or zero so uh it's really pretty amazing how fast it has become a major tech hub my answer which was really surprising to me starting in january and i think i i started texting you guys in january saying i really think we should talk about this on the pod if you'll remember and it's obviously just become a crescendo since then it's nfts um and it really has been incredible to watch how uh you know the individual um folks in crypto have embraced nfts as a way uh you know to tokenize the value that creators can bring to the world and i think yeah there's a lot of fluff and a lot of noise and a lot of bubbles going on within this nft space right now most of it will die and it will look terrible when people lose lots of money and feel bad about the decisions they made during this phase but what i think is really wonderful about it is the opportunity it creates for creators to monetize their talent in a way that doesn't require them going through middlemen to get distribution and middlemen who take you know huge slugs or huge chunks of the margin out of um out of what they create and this can ultimately translate into music into art into writing into all sorts of things so i'm pretty excited uh not necessarily about where nft sit today i think it's disaster where it sits today but i think over the long run why is it a disaster i i just think there's too much of this bubbly stuff that's going on where people are buying into speculative transactions that are going to lose their money and then people are going to be really hurt and really upset um but but the general core tech i love the fact i love the fact that creators people that are great at art and people that are creative uh can develop stuff and make money because people will appreciate it and pay for it and i just think that's awesome fantastic all right so for me um it was that daos were able to raise 40 million dollars in a couple of days for this constitution and get and basically captures every capture the entire world's imagination for you know a 72-hour news cycle uh much in the way the day traders did um with amc and gamestop to freeberg's point earlier than the big winners and i'm i have a dual one here i'm absolutely surprised about this you know the the the dow that was able to raise 40 million for the constitution but i was also disappointed that the sec in your 10 plus of crypto has not defined the rules of the road yet so that one group of people professional capital allocators play by one set of rules and then another group of people dow's tokens are playing by no set of rules or their interpretation of unclear rules i guess would be the most charitable way so that's my biggest surprise we have to have a regulatory framework for crypto for dows for nfts for tokens and it's just crazy that it hasn't happened yet what do you got your mom uh my my big business winner breakout company uh i have two but they're the same really as modern biontech uh you know these were guys that were kind of swimming at the edges of science and r d and somewhat was just incapable of putting one foot in front of the other until this pandemic and through a bunch of you know emergency use authorizations these guys have really shown up to help the world and in 2020 i think they cemented themselves as now on a path to not just you know be a vaccine maker for covet but a whole bunch of other things including cancer treatments and everything else so i think right these two companies these two companies really took a big step forward in 2020 absolutely and just as a side note openc had eight million a monthly val volume at the beginning of the year in january and 3.46 billion in august just give me a little idea of the scale of that okay best science breakthrough what do you got freeberg everybody wants to know the sultan of science's best science breakthrough i'm a little bit um blinders on this one because i think i mentioned this on the show a few weeks ago and i'm spending quite a bit of time at work on it which is that starch synthesis system that was demonstrated by those chinese scientists and the system itself is likely not going to be the production system that saves the world but the concept that we can take proteins that are expressed by different plants and put them together in a tank and then that tank can convert molecules from one form to another by leveraging these proteins that just interact and move move around in the tank is really an incredible demonstration and the demonstration is inspiring we can take carbon out of the atmosphere and make food with a minimal amount of renewable electricity and i think that's really a moment that will inspire a whole new realm of industrial synthetic biology work uh a lot of which i hope to kind of you know build and participate in pretty heavily in the work that we do day to day but it was really exciting for me so the starch synthesis synthesis system is your best science breakthrough what do you got sex i've got these new oral coveted antiviral pills that are coming out from pfizer merck the fda is supposed to be approving them by the end of this week as you'll recall last year around this time it was these new mrna vaccines from pfizer moderna but we now have to admit that the vaccines have not ended the pandemic because the virus can mutate its spike proteins around the the vaccine so the vaccines by itself cannot end the pandemic these new uh pills have i think a very good shot of doing it next year because they're protease inhibitors so they stop the virus from replicating and just and even if the spiked proteins mutate it will not prevent these protease inhibitors from working so i am hopeful that this will be the thing hopefully that ends the pandemic next year are these new uh antiviral pills i would like to make a counter to sax's um point i would be very cautious about the side effects that are going to arise from these protease inhibitors and um you know they're they're not as well studied as they normally would be but there are they have a serious biological effect in normal cells in the human body um and i think as more people use them you'll see more crazy stories about side effects that are really uh significant side effects would be there's a lot that are well documented but the way they work biologically is they disrupt um you know certain systems and those are not just systems related to the virus they're systems in our own cells and so i i i'm personally quite nervous about them i know that folks are pretty encouraged by them and excited but i'm nervous about them there's a similar medication that's been developed uh for hiv right it's called prep right does that cause similar side effects or because people use that prophylactically yeah to some extent you know and the dosage matters and so normally you would go through many more years i think of testing on these things to kind of truly quantify you know when you have half a percent or one percent of a population you know let's say take the most extreme case die then a million people use it you're gonna have a lot of people dying um and i'm not sure we've really gotten the boundaries of this yet and the dosage is pretty significant on them uh so uh yeah like let's you know let's keep a watchful eye on this stuff but uh i'm i'm hopeful but i'm also nervous well hopefully the number of people who need to take it freebird correct me if i'm wrong if we've got this many people vaxxed who will not need to take it and then omcron my biggest optimism is just that omicron is a um much less virulent virus and it sweeps through the population and we slowly see this pandemic kind of you know becoming less severe which is what was predicted do you think herd immunity even exists in the way that the virus evolves no so um there and by the way it's not binary uh it's not like hey you get hurt immunity and no one's gonna catch this thing there's clearly a spectrum of immunity meaning like i can maybe get the virus and be somewhat contagious for half a day or a day and i don't even know it and then i'm spreading it for that half day but i didn't even know i had it that's kind of you know not all the way over to hurt immunity and the traditional kind of definition of the way that we talk about it um but it reduces the spread and the severity and aggregate on the other end is like everyone gets it it spreads like crazy no no vaccine stops it changes anything no amount of antibodies changes anything and everyone just dies um and so somewhere in the middle i think is where we find our kind of you know our ground but i i don't think that the traditional definition or the way that people talk about herd immunity which is hey everyone get the shot and this thing's over uh it's gonna play out that way at all this is gonna be a slow slow wind down okay to give shamat some credit you said it would be a nothing burger and uh so far it looks like deaths and hospitalization specifically icu's uh admittance has not turned out to be a major issue yet knock on wood unless something escapes from the lab again i think that we're going to be okay i think this is the end of the end so oh that would be so great if this was the uh end of the end game my best science breakthrough is that this year we actually were able to inject in vivo so in the body genetic code for crispr two cases specifically one was to basically reduce the production of this toxic liver protein in a bunch of folks and then the second one moderately improved the vision of some people who had some form of inherited blindness and that's pretty incredible stuff that you can you know make something uh put it into your body and then you know your body does the work of editing out the bad genes and um that's a i think that's a pretty incredible breakthrough i had the starch on my list too but um i went with starship uh for people who don't know a march 3rd starship serial number 10 sn10 completed spacex third high altitude flight test of a prototype type and they were able to ascend um and then reorient themselves and land if you don't know starship is ginormous when compared to the falcon and the other rockets uh that spacex has produced i got to see it actually i went to boca and when you look inside that nose cone you can fit 300 people in it uh it is a payload that is absolutely unprecedented in terms of sending people or things to space and the fact that this has succeeded means all um uh the folks at spacex need to do is to scale it and they're pretty good at scaling things they just had their hundredth landing of their smaller rocket and so when this uh big boy this uh bfr big freaking rocket gets going it's going to change the nature of our species as multiplanatory planetary and being able to reach and put things in space that we've never been able to do so kind of an engineering feat but i put it under science uh and also to not pick the same one as free bird do you think starship is going to be able to orbit uranus no nick you can't take that i have veto rights all of this needs to stay all right biggest flash in the pan biggest flash in the pan sacks you picked people uh you told me earlier no i said we love people please yeah no that was yours um i had uh i think the the use of the word uh transitory uh was my biggest flash in the pan it seemed like for a brief moment that every uh administration official every uh democratic political consultant every talking head on tv kept using the word transitory it was very much the vocabulary word of the day but now uh it turned out that the inflation was not transitory and so the use of the word transitory i predict will in fact be transitory my summary like that what do you got chamath uh i picked uh all things uh metaverse and web3 and web3 yeah writ large if you guys were around in the emergence of web 2.0 there was there was a period when where this gaggle of investors were just clamoring about web 2.0 none of us understood what it is and we were building it it turned out yeah and so i think that uh these trends actually have names and those names are of companies and those companies create experiences that people want and so i just think that this whole concept of metaverse and web 3 goes away and we replace it with real solutions for people that give them value and then we'll be obsessed with these companies and uh this this too will be transitory i went with the constitution dao um while while i believe jason that the concept was inspiring and will echo for quite some time with other um you know kind of improved uh versions and different applications this particular dow uh caused a lot of people to lose a lot of money in gas fees transferring tokens over to cover the expense of the ultimate purchase that was not actually done it felt a little disorganized there was questions around equity and securities and the legality and misaligned expectations and while i get that there was a good intent and that folks that were involved in it were felt like it worked and it did what it was meant to do which was to be inspiring that particular dow came and went in three days and i'm not not not to discredit the concept and i think that more will come in the future but it really was such a loud moment and then it went silent two days later yep okay and i picked the woke socialist leadership of cities uh specifically the once great city of um the once great city of san francisco where they thought they had figured it all out and that they would be able to run roughshod over the citizens of their own city and lo and behold when um an investigative journalist was hired by myself and uh gary tan did the democratic recall and sac supported the republican recall lo and behold london breed has decided that she does not want to get recalled and she is fed up with the [ __ ] in san francisco and chesabuddin and all of these whack jobs are all going to get voted out and recalled and we've seen it and it came up earlier in the program to beat a dead horse but these failed policies of letting people run amok and not having some base level of protection and not listening to your citizens they belong in a textbook and in a preschool you could talk about them in graduate school yes this is great for a college dorm to talk about what would life be like as a communist as a socialist in the real world people want to be safe when they take their kids to [ __ ] school period end of story and if people don't feel safe you're not going to get reelected game over i also think that people have a reasonable right to have their kids educated and not managed to some watered-down lowest common denominators so as to not so as to try to make everybody around them feel better yeah a hundred percent all right i have a feeling that we're gonna this is gonna sweep here best ceo should we just say three two one and say the name i'll go first i'm gonna pick satya nadella oh well done and uh the reason i say that is that you know he if you look at this track record and i thought this business could not get any bigger but it just is a compounding absolute juggernaut and a machine he has completely turned that company around and from you know big chunky acquisitions he's unafraid to pull the trigger and rip the money in linkedin github this year he did nuance the product portfolio he you know we had to compete with him at slack when he was you know he decided to turn the the sights on on with teams on to us we had no choice but to basically sell the salesforce this guy is a master executor has kept the entire company out of the press has had the least amount of pushback around their growth and expansion the least amount of lawsuits the least amount of bad pr so just in terms of uh you know first class ceo he he he's running a master class he's crushed it crushed crushed scale totally what can brown do for you that was a ups logo and it's now it's now what the shareholders are google company microsoft twitter twitter uh palo alto networks uh and adobe have said okay [ __ ] proud too for you okay uh so much for the curry ceiling uh okay we have smashed through the curry ceiling absolutely there's curry penetrated the samosa ceiling there we go free break will you guys you're making me hungry i know god i'm having i'm having crab curry tonight can you believe it i went fishing i told you guys this i went oh bleep out the name i went fishing and uh we caught some crabs and so we're having a crap in the bay of san francisco bay yeah oh did you go up to like chrissy field and no we go we go to the pier and then they take us out past golden gate bridge to point reyes we caught rock fish which we ate yesterday delicious this is on a boat you did it on a boat yeah oh wow great great captain awesome yeah it's cool i would take london uh my 12 year old crabbing when i lived in san francisco off of chrissy field and we bring crafts home and all that uh you can get these incredible uh credits you can get a one-day sport license from the state of california it's good for 10 fish and 10 crab it's amazing all right uh so who do you got freeberg best ceo well i like uh i like the jack and elon um going direct experience this year and what i mean by that is it's less about like how well did the business performed i mean so many tech company ceos have performed so well this year it's hard to pick someone uh for driving business outcomes but what i liked about jack and elon jack in particular in the last day is um you know having a voice and going direct and being inspiring i think that leadership is all about defining where you're headed and then creating religion in the troops to follow you to go there and i think the way that both of these folks speak directly to people and the way that they speak authentically and that they tell a big story about where they believe the world should go and why you should follow them to get there um you know creates a model that a lot of other ceos i think should and will start to follow and i think we'll see a lot more of this kind of like twitter going direct type of activity happening in the in the years ahead sex what do you got best ceo i have brian armstrong because it was about this time a year ago that he drew a line in the sand and said that he was not going to allow politics in the workplace it was going to be a demilitarized zone for politics it was pulling people off mission and a year later he gave us an update it's been the best thing they ever did they gave a generous severance package to anyone who didn't go along with it was only five percent took it they then went on to have a very successful ipo uh it's now a 65 billion dollar public company and um a year later they are more mission focused they've attracted more employees their diversity numbers have not gone down and the reason i pick i'm picking him is not just because of the business success but i think there's a lot of ceos in fact i'd say most ceos including some of the bigger names that we're all kind of talking about are secretly would love to do what brian did they would love to basically ban politics in their workplace but for whatever reason they just don't have the cajones to do it i applaud brian for taking the hit of the new york times hit piece that then came after him and to stick to his guns he did this policy and i think coinbase had a great year amazing choice wow three great choices satya jack armstrong i think elon clearly is but i'm going to pick somebody else so it's not all elon all the time i'm going to go with frank slootman from snowflake this company has grown incredibly at an incredible velocity but i just read his book i got a pre-order of his book pre uh pre-release of his book called amp it up and i had him on this week in startups which will come out in the new year when the book comes out and uh he's a killer he absolutely he's like a killer he seems like an absolute killer and the book basically is i do not care about how you think business works here is the zero-sum game of competitive business and here's 205 pages it's a must read and he just wants to win and uh so my hat's off to him 100 billion company uh and they've absolutely crushed it so uh best investor chamath are you going to pick yourself for the third year in a row or do you have somebody else in mind this one this one i think is a is an absolutely easy one but it's my dear friend dan loeb oh founder and cio when did that happen founder and cio of third point uh and of of as i've seen i talked to him yesterday actually i called him just to wish him a happy birthday by the way it's his birthday ah happy birthday but he has shown the widest range this year and really put everything together yet again kind of one of these virtuoso performances early stage success so he was a you know early stage investor i think they did the series a and sentinel in one that had a big ipo this year growth investing he you know was a was a great investor uh early investor in rivian that went public this year he had great public performance and upstart a bunch of other ones activism he went after shell crypto i think he's an investor in ftx and a bunch of other things i mean just tonned it and to be able to put together a team that can execute across all of those business lines and risk manage and then where he still sizes like i'm telling you like it is so hard to size this stuff properly and get it right he did an incredible job and he's just a a beautiful lovely human being so damn all right we're we're cooking with oil we're moving at a nice pace i picked the sequoia fund the new evergreen sequoia and the sequoia fun the new evergreen fund obviously over the past two years they've had doordash airbnb snowflake unity all these incredible companies worth over 300 billion dollars combined and now those lps get to keep their money in this one vehicle and uh i think it's going to make sequoia even more powerful great innovation shout out to my friend roloff and i gave a runner-up to brad gerstner friend of the pod um who obviously did snowflake uh last year but i had to grab ipo this year which i think was the largest back in history uh and uh you know i don't think it traded particularly well yet uh but uh congratulations to brad as my run around who do you got sex well my first thought was nancy pelosi but you're just going on performance yeah i don't think it counts though if you do it through insider trading so i had to rule her out okay sure um so my actual choice my actual choice is ken griffin the founder of citadel um he generated something like 10 returns on a 500 billion dollar fund i mean just mammoth mammoth amounts of money but it wasn't just his economic return he's obviously a cash generating machine but it wasn't just that it was also the way that he came out on this whole wall street bets robin hood scandal way back in january remember of the whole payment for order flow was a gigantic scandal with with robin hood and he along with vlad and others was hauled up to capitol hill but they could not lay a glove on him he demonstrated i think in commanding testimony that all these conspiracy theories around his role had no merit and the populist revolt around uh this whole payment for order flow robin hood thing broke against the rock of ken griffin uh he comes out as a huge winner both economically and politically and you left out the most important part he was the super villain in buying the constitution yeah and he got refused one extra dollar yes he got he got revenge on the crypto people that's right that's right great great financial troll free break did we get yours yet best investor of 2021. i kind of stuck to private markets just because they're illiquid which means it's harder to source not everyone has the same data um we all have different data and different points of view so um within that i kind of said look what makes the best investor and number one is obviously good returns you know who's got the best returns but second is how scalable is your investing machine and third is how durable is it like does it get worse as you scale up i know where you're going with this um so you know i had three kind of finalists one was founders fund and i would argue they probably have the best um consistent returns in terms of the multiples on their funds uh tiger global which we talked about earlier which i would argue is the most scalable and durable as we've seen deploying 15 billion this year and then finally sequoia which has near the best returns scalable and durable with this new transition you talked about and ultimately sequoia won out so that's my my trade of success one of the first times we've had two of the same in the voting this is incredible best turnaround what do you got for best turnaround tremont best turnaround i picked ford enormous performance this year the stock's up 130 odd percent good portfolio mix of uh you know gas guzzling cars that still make a ton of money like the ford f-150s but you know they have the mustang they have the electric versions of the ford f-150s they had some great investments i think they printed like a 20 billion dollar gain on rivien so it's just a really really good turnaround from what that company was which was if you talked any car company that that could have been up 132 at the beginning of 2021 it would not have been ford so uh well done by that team who do you have sex are you an investor in fortuma uh no no so i went a little different for this i said the best turnaround was kyle rittenhouse's reputation as you recall ridden house shot three white attackers including two of them were sex offenders at a violent blm protest in kenosha the media then painted him without any evidence as a white supremacist terrorist who went there looking to shoot people like some sort of frustrated school shooter it turned out not to be true there was clear video evidence at the scene that he acted in self-defense once there was a jury trial all this came out he was acquitted on all charges and the prosecution was revealed to be politically motivated i would say that um britton house now has his freedom and he has a reputation back in the eyes of all fair observers who do you got freeburg well i went from who was in the worst shape and you know came back from that and i i put wework on here um which is an obvious and easy choice wework to me is like rocky balboa um you know rocky balboa could not win the match rocky balboa got so beat up goes to the you know to his corner he gets patched up he's bleeding from his eyes bleeding from his nose he's literally about to die his coach gives him a little smack on the butt and says get back out there and he keeps going he's not going to win the match um but man for wework to go from where it was a few years ago which was days or weeks away from bankruptcy billions of dollars of money injected by softbank and for them to orchestrate uh basically this this whole you know juggernaut into what looks like a business now um and get it public via spec and it now has enough capital and a good game plan and it looks like maybe a normal you know challenge technology business was really quite a turnaround there was no one to sell this thing to they had to get in there and they had to rework this whole thing and they reworked wework and rocky balboa is going to make it to the 10th round he may not win the match but you know he's still in it it was pretty pretty impressive to see them get it out this year all right listen i struggled with this one i had two companies that i really wanted to highlight for two different reasons one uh was twitter which had no product velocity and people thought and i'm taking out financial performance right now i'm just looking at the product itself um and my lord have they increased their product velocity releasing uh newsletters audio spaces um and countless other features and so i like them but i actually think disney which was and it hasn't performed well this year but they had 44 million subs um they added 44 million paid subs this year and uh people thought theme parks would be a problem etc and i think they're going to have an absolute killer future if apple had not uh if it hadn't been for antitrust right now i think apple will be looking at buying disney if they had had any way to get it through there because the job what are they what do they turn around exactly like turnaround means it's crappy and then it's not crappy well i didn't do stock price but i think they had a major threat and a major question of could they actually create their own streaming platform would it work uh and getting out of the pandemic could the parks rebound the parks have rebounded i see i think they're going to roll over netflix so the sentiment was like got this stock i don't know um and they've really i think turned it around yeah the stock's been a dog this year but yeah that's why i said like it's kind of hard to pick it but i do think like if you look at the fundamentals of the business twitter 2018 is going to go to 300 million um because they announced so much content from the star wars marvel pixar disney ecosystem that is coming this year and next year um and it's going from book of boba fett mandalorian obi-wan kenobi where um you know uh hayden christensen and the guy who played obi-wan kenobi are coming back like this library is going to have a ridiculous 2022. i like hbo max more than disney plus i mean my kids watch a little disney plus but they watch all the other streaming services too yeah uh disney plus doesn't seem to have a monopoly for me hbo max is such a depth of consciousness when that warner media deal gets done i think that's the juggernaut stock you want to own it's going to have an incredible library to compete with disney well i mean secession and just the library man they got so much in there they're releasing uh their sopranos they're releasing the matrix tomorrow on hbo they redid plus like league the new the new matrix comes out on hbo max tomorrow it's day and date i love that because i i love that they did that with dune i love dune totally yeah dune is an incredible movie i'm in my movie theater right now so i'm going to watch it on my movie theater this week okay worst human being i'm gonna go first i'm gonna say elizabeth warren um i think trying to raise money off of the back of the person who raised the most money for our taxes from taxes is just lame if you haven't seen she's attacking um elon and bezos in facebook ads trying to griff to get ten dollars while she's got 12 million in equities that she paid like zero dollars on because that's how the tax system that she has operated under for decades works worst human being to me elizabeth warren uh i am going to pick travis mcmichael gregory mcmichael william rhodey bryan roddy bryan and derek chauvin four white men who uh killed in two different incidents uh an unarmed black man they are scumbags and they should go to jail and they will for the rest of their lives they are terrible human beings great job saks who you got for worst yeah i've got a name here i don't know if if the audience knows yet it's a guy named peter uh dazek who's a british zoologist he's head of a group called the eco health alliance that received millions of dollars in uh nih grants for gain of function research in bat viruses if that sounds familiar it's because some of that was given to the lab in wuhan from which kovid likely leaked but that by itself is not the the reason why he's my choice he then became one of the leading signers and organizers of a letter that was published in the lansing in february of 2020 insisting with total certainty that the virus had made the leap from animals and humans rather than being uh rather than leaking from a lab in fact he basically painted anyone who had put forward the lab leak theory as a conspiracy theorist uh he you know his influence made this so-called zoonotic theory the official narrative that could not be questioned online for well over a year all the social networks then censored on that basis and he never disclosed his obvious conflict of interest given that his millions of research was threatened if the lab leaked three were proven right so this you know this guy not only helped unleash a plague upon the world he then lied about it to cover his ass and protect his millions that makes him the worst of mine if you're interested in hearing um a point of view on this uh jamie metzel did an interview with lex friedman on lex's podcast it's worth listening to it's five hours long but the um uh the section where they talk about what sex is sharing i think it's around the one hour mark um and it's a really interesting narrative that jamie shares about what this individual did uh during this period of time and why does it support what i'm saying yes he's not going to listen but now he feels smug with himself so yeah thanks for having me okay i'm into genius yeah alex is great no so uh my source for this has been the reporting of glenn greenwald who did some pretty good research on a great i mean sort of expose on the conflict of interest that was never disclosed and it was on this basis that all the social networking sites then engaged in censorship so just a whole you know cluster of bad motives by you know people looking to cover their ass but i mean it's worth hearing jamie's point of view on this which is he tries to identify the motivation and the incentives that those people had when they made those cover-up decisions along the way and i think it's really worth everyone taking that in that's what i really liked about lex's podcast interview with jamie um was you know none of these things come from a place of pure evil they come from a place of incentive and motivation where these individuals think that they're doing the right thing for some reason and and that's what motivated their behavior but that's also why and just to jump the gun here i am not giving you a worst human being answer uh not a virtue signal uh really i just go back to this point that i don't think humans are you know intrinsically evil i think that a lot of people make decisions for what they consider to be good reasons or the right reasons or reasons that are in their mind altruistic but ultimately have adverse consequences for another population not not derrick yeah i would argue that in some cases people who are selfish um don't make it very far in life and so they generally don't have that much of an impact in an evil way there's very few people that are purely selfish and make it to scale but um anyway that's my very esoteric so i think freeberg raised a good point which is i think we can judge this not by people's internal motivations because we don't really know but rather by the consequences of their choices right yeah the adverse consequences okay so uh best meme i'll go first uh i love daniel craig's uh the weekend because i've been so exhausted from this year that when friday rolls around that's all i can think about is daniel craig saying ladies and gentlemen the weekend he's just exasperated and exhausted as am i my runner-up was anakin and padme doing their conversation you know uh for the better right and you can look that up online it's a four pane it's one of those four pane conversation ones uh what do you got chamoth you have any best memes it's the uh bernie sanders inauguration outfit amazing always a great go-to that's a good one his little his little mittens and you know his attacks he's detached communist glare about that great meme yeah it's like he's at a sit-in at like uh some college in vermont in russia in the winter time exactly exactly it's like a little chipmunk yeah all right who do you got saks you got your best meme the ever given uh forklift meme this was that little forklift trying to push that gigantic barge out of the this year can you believe it and a closer runner-up was my fault plans versus the delta variant oh you remember that one that that was a great one that was a good one freedberg uh yeah i know you don't care about pop culture or consume much of it but give us your best me no i don't i don't have a meme so i do not have a meme upgrade i have no sense of i like tomorrow's name that was a good one i'll take that one sort of enjoy your memes but not enough okay can we upgrade his meme subroutine i love pop culture this the meme thing i just don't it doesn't resonate for me it just doesn't love pop culture yeah i am pop culture memes do not make i have trouble processing imagery and text all at the same time my subroutine is indexing all images and gpt3 i'm going to produce funny jokes ha ha my laughing sub routine has been upgraded [Laughter] sorry it's too easy sorry allison most losing company deliver them both i don't think she listens to this by the way no my wife doesn't listen to it i was talking to my wife about sweater care or whatever she's like what are you talking about i'm like the pod that everybody listens to none of our wives listen to this crap number 40 in the world no okay most loads of company this one is an absolutely easy one slam dunk it is uh pg e who this year was charged with felonies and manslaughter in the death of four people because of the wildfires that they started because of their inability to maintain their power infrastructure throughout the state of california very rare that a for-profit corporation gets charged with felony murder and manslaughter so i think that's pretty easy one what do you got freeberg i think one day the human race will look back and identify animal agriculture as worse than human slavery i i do think that that will be a profound realization over the next century for our species and uh did you say worse than human slavery i believe that that's what we will realize because the the scale of death caused by animal agriculture okay oh i think they've got the birth to death cycle that these animals live in in cages with no ability to touch or interact with their families uh the the hurt the pain it's extraordinary and uh part of my work that i do day to day is to figure out ways that we can use science to replace animal agriculture so the uh penultimate kind of animal agriculture processor in the u.s is tyson foods they are the most loath of them company to me um and uh i stick by my my answer can i can i give you a counterpoint yeah but it's delicious it's a joke that's not cool is it a spicy take i mean to human suffering of slavery and then equate it but you added i mean murder honestly free bird like if you yeah but the thing is look you haven't intended you've never eaten any form of animal protein so how do you know what you're missing it's true but he does know about cruelty um yeah i guess i think there's any winners in this conversation at this point yeah this is a longer pod we could do this another time fried chicken is really delicious oh man so is a good steak okay we got to stop i'm hungry sacks did you have a um besides tyson foods uh what do who do you got okay mostly for centering you and putting a label on your thing that's it i had the new york times a new book came out this year in 2021 called the gray lady winked the author ashley rensberg details decades of misinformation and agenda-driven journalism published by the times starting in the 1930s they had a nazi sympathizer as their german correspondent they covered up stalin's genocide in ukraine they assisted fidel castro's rise to power in cuba they lied us into vietnam and iraq they and they perpetuated the russian collusion hoax more recently the new york times has gone all in on woke journalism and canceled culture purging anyone from its ranks who commits a transgression against wilkes sensibilities from brian armstrong to kyle rittenhouse they've routinely smeared people as racist with no evidence to back it up remember they are not a non-profit they are a corporation and they have an agenda new york times most awesome company in my life and david can i double down on this i posted nick maybe you can find this but there was a there was an article in the washington post that i put into the group chat where the washington post article was effectively like washington post forced to revisit journalism practices because of falling click-through rates and lack of viewership so in a post-traumatic trump yeah yeah post-trump era two years on you know their their the number of premium subscribers that wapo has has pretty materially changed i guess and so you know they're revisiting what they're trying to write and as you can imagine they're going to air towards more click bait and it's the same for the times and so you know to your point we have to remember that these things are not run as public trusts they're run as for-profit businesses yep we've seen what other for-profit businesses do as it relates to information and misinformation and disinformation and so you have to heavily discount what you read in these places information after profits trust and this is why tech leaders and other people are increasingly going direct as we talked about all year in the pod go direct they are not the paper of record anymore direct is the new the internet is the paper of record i mean look at this podcast i mean i think like we're going direct we get more views on this than any other press hit we could ever do and we get to talk to you i think we've probably eclipsed msnbc any show that and we're probably going to pass cnbc and fox by the end of this year sure so uh for me um i would pick the mypillow guy but that's not a real company um so i just picked meta which is just so obvious i just think bro you have these themes you're like you're so after facebook you're super tilted about facebook you're super tilted about senator karen yes they just keep cropping up in every category i just it's hard for me not to pick meta here best new tech for me it's dao's um i mentioned it earlier i think it's phenomenal i think that they're going to evolve and globally what do you think it is taos no they're what global capital formation are phenomenal they're phenomenal i said phenomenal all right stop making fun of the kid from brooklyn okay do you think this podcast was number 40 if i didn't okay enough enough you're ungrateful pray listen you're tilting me now i'm trying to get this show over with 75 minutes in okay i say dows because i believe that they will become legal and global capital formation for the first time on an instant basis will exist and i believe 40 million is the drive run for the constitution 400 million and 4 billion will happen in the next 10 years to do bigger and bigger challenges the world wants to bet as a unit together and this is going to be the crowning achievement of web three dows what's the best new tech for you mr pauli hapatio i have two choices okay uh one is in the heavens and that is human space travel okay we had three different companies create astronauts this year three amazing that's like insanity so that it's mind-blowing and so if you think about what the next five to 10 years can bring jason what you said earlier about you know making ourselves a multi-planetary species what an inspiring thing that these thousands of employees across these three businesses did huge congrats to all three of them uh i found it really inspiring so i think human space travel and then the second which is much more closer to earth is sub stack i think really got to a level of scale this year that is really profound i have found it to be an incredible way to stay connected to the truth and there are some unbelievable people who are now able to create a life for themselves by telling the truth independent voices yeah and uh and you can support them directly incredible you know a handful of people matt tybee barry weiss eric newcomer just a handful that jump off the top glenn gleanwald but there's there's many more sub stacks going to learn how to promote these things to you in a better way i think over time but i think that was an incredible incredible subscription eventually there'll be some sort of group subscription and then you'll be able to put glenn greenwald and barry ice and and have multiple publishers come in like an aggregated feed or something to that effect in other words you could subscribe to the new york times of these independent voices and they would put the money across them it's the closest thing to truth as a service that we have and with po i'd say podcast is right up there too sax uh i'm obviously you're gonna pick call in but after calling what do you got for the best well i you know i originally had the the christopher jean at anything but your mother already mentioned that so i'm gonna i'm gonna go with starlink it got uh yes it it just came out at the end of 2020 but this year it kept getting better and faster and now it's reported that starlink is faster than the fixed broadband average in belgium canada australia germany the uk new zealand and france come on no way really yeah it's pretty unbelievable wow gavin baker just tweeted this uh earlier today this morning that's the data all i can say all i can say for all of us who owns yeah yum yum that's so delicious okay my best new technology i think the 2021 was the year of plasma fusion there were several iterations and step function improvements in plasma can you explain what it is to people who don't know the concept ultimately for plasma fusion is that you can generate a controlled nuclear series of nuclear reactions where energy is released and as these atoms transform and energy is released rather than have a runaway breakthrough effect which you would have in a nuclear bomb for example you can actually control it and harness the energy that comes out and there are several technologies and techniques that have been theorized for 50 years that we could do this in a way that the energy that we put in to create and start the fusion reaction um allows us to get more energy out and therefore you have a net energy creator just by turning atoms into energy in a way that doesn't cause a runaway breakthrough nuclear reaction that would be the equivalent of a nuclear bomb and so um you know the mit cfs collaboration had an excellent breakthrough that we spoke about on one of our pods the national ignition facility which is actually a usdoe funded facility came very close to energy abundance and they have a wonderful chart that shows 20 years of doing this work and then this year it suddenly balloons and is that how they make energy on the sun uh this one so so all of this is is fusion that's correct uh but that's not that's how they make energy on the sun well what we're doing here is um we're basically using lasers to create the same um uh uh density that you would get on the sun that triggers that same sort of nuclear war and what about uranus different they're different um buildings being funny yeah generally general fusion had a big breakthrough and bill gates is a big backer of a company called terrapower that announced that they're building a new reactor but i think generally speaking we are seeing 2021 as kind of that big step change where this stuff is starting to move from theory but we have it online still as everyone's been saying for decades 10 years every year every 10 years we say 10 years yeah best trend worst trend here we go i'm going to go with the best trend being centrism purple pills recalls of da's reasonableness and maybe the po the political class actually representing what most of the country wants which is a high functioning government that gets the hell out of the way what do you got sex best trend hashtag wokelash we saw this is similar to yours we saw a major pushback against woke ideology on several fronts this year first you had parents pushing back on crt leading to a republican sweep in deep blue virginia then the whole defund the police initiative was rejected on the ballot of of minneapolis where it all started even mayor of san francisco now wants to refund the police the attempt to cancel dave chappelle totally fizzled out after the walkout protests in netflix and even uh barack obama told the progressive left to quote get over their work purity earlier this year they should have listened to him and maybe they finally will next year after losing more elections um i'll just repeat something i said earlier i'll be quick about it the creator economy blossoming um new models for monetization for folks that create uh content whether it's video art music and uh you know there's all these new models for bringing your art to market your content to market and getting paid for it and consumers are clearly willing to pay for it so it's awesome to see the gatekeepers are falling away and the go direct model is working what do you got your mouth i'm gonna double tap that uh i have the creator economy i think it's incredible what these young creators are basically you know uh creating it's incredible super super novel and new forms of content tik tok is super addictive stay out of the comments youtube is incredible so this is a brave new world for for creators all right so worst trend the worst trend of 2021 i'm gonna go with giving credit for work that hasn't been done yet and just straight up founder and investor entitlement i've never seen it at all time peak here where people expect to be given huge rewards before they do the work and i'm very concerned about the lack of governance the lack of diligence and uh people believing they should get huge rewards before they actually do the work what do you got chamath uh my worst trend is the decaying of the national security of our supply chains um if you think about some of the really important things that we're going to have to get done over the next 10 years just like climate as an example china has done a masterful job they control you know a lot of the lithium a lot of the nickel a lot of the cobalt a lot of the graphite they control a lot of the rare earths that go into the permanent magnets and we don't have a solution so uh that is a really bad trend that accelerated this year we have some really ambitious programs in america that are unfortunately stuck because of you know lawsuits uh claiming that the you know the wood grouse is more important than batteries and so unless we undo that stuff we're in a bad place okay saks what do you got i've got uh the rise of authoritarianism around the world and here in the united states i mean even in western countries like australia it's basically been turned into a prison colony for months in the name of stopping covet here in the united states you've got governors like alvin newsom who've basically appropriated dictatorial powers through a bogus state of emergency you've now got um the unvaccinated treated as some sort of untouchable class of of citizens who aren't able to leave their house except to buy food and medicine they're even now in europe they're splitting they're forcing people behind partitions at the supermarket boston just announced they're banning on vaccine people from going to all restaurants bars nightclubs sport arenas fitness centers movie theaters and on and on it goes on top of that you've got censorship you've got um you know the censoring of speech you've got this this sort of crackdown on uh domestic political enemies and i think it's also emboldening authoritarian regimes like china and russia to crack down harder on their citizens because they see what's happening in the west and they think they can get away with it so all around bad stuff i think to your point sacks it's one of the reasons why we will see people in general looking for alternative ways to govern themselves and it will only catalyze and accelerate some of these other trends that i think we've been talking about my worst trend was the metaverse i think it's like the renaming of something that's been going on for a long time as if it's some new future thing if anyone's played fortnite over the last six years or five years um you know the metaverse has been here for a long time and this notion that you can kind of take it and make it something that doesn't exist yet and it's all about the future and make some stupid video about it uh i think is a little bit lost in what's already been going on which is people find value in digital goods people find value in digital levels and badging and they find um honor and progress in their lives uh by accomplishing things in a digital universe and they've been doing that from minecraft to fortnight uh to other places for a long time um and it's uh it's it's fascinating to watch but the notion that we call this thing the metaverse and everyone's trying to reclassify it as some future singular universe and therefore they can own that singular universe is is a is a pretty misstated and misguided kind of concept let's go on to your favorite book movie podcast music discovery of 2020 for music i had war on drugs for book of ray crocs autobiography i uh listened to on audible and it was great on tv secession curb your enthusiasm and dopesick were my three favorites i think freeberg what do you got uh considering that you have had your pop culture i will tell you guys one time i think i think it's very important that everyone on this pod and anyone listening to this that has any interest in what's going on in the world today broadly read ray dalio's the changing world order it is my number one number two and number three book recommendation of the year it is absolutely critical to understand that the global world order is being reclassified as the united states has taken on too much debt and will ultimately lose its reserve currency status as we have seen with the transition of five or six empires over the past 500 years and this transition is very predictable as ray dalio highlights we are following a pattern that we've seen over and over again and um and we are in a moment right now where populism whether it's authoritarianism on the right or socialism on the left is a reaction to what is effectively a very small number of people controlling a very large amount of the wealth and the power in this country and in the world and we've seen this play out and as governments and societies evolve eventually this happens there's a massive revolution typically triggered by some new technology emerging like the printing press the radio shipping and in our case today i would argue what people are calling web3 or the blockchain as that that triggering technology and as that happens the current dominant empire transitions and a new world order emerges and this is not some conspiracy theory it's a it's an in-depth look at the economic political and social organizations that have broken apart over the last 500 years and where we sit today um it's not about politics it's just about manifestations of human behavior over time done for that everyone's got to read it my second oh i got one more come on okay no of course keep going wes anderson's the french dispatch is one of the best films i have seen in like a decade have you guys seen it no it is friggin amazing i feel like every shot is like a cinematography masterpiece um the writing is incredible the acting will blow your mind if you guys see that film we could talk about it for hours it is just no political agenda no nonsense in it it's just pure art it's really beautiful oh and then on music i'll give a shout out to a very unknown artist who i think deserves a little shout out his name is dk the drummer dk the drummer did a collaboration with a guy named alejandro arenda who was on american idol my kids cannot stop listening to his track that they did together it's amazing uh shout out for that guy i just figured he deserves it for putting out an awesome track all right sax um which steve bannon episode was your favorite [Laughter] so under book of the year i have a very recent choice which is san francisco by michael shellenberger it just came out but it's already i think very influential it's not just about san francisco it's really about how the so-called progressive agenda in cities is not working i think it is going to be the blueprint for a major backlash that's already begun here in san francisco with london breed taking on chase boudin i think that's going to be a recurring theme next year also other big cultural discoveries uh i like jamaath i have red pill journalists on sub stack glenn greenwald matt taibi antonio garcia martinez all of whom now have shows on call-ins so those are my choices um there's a second plug okay here we go uh chamoth what was your favorite app besides colin exactly uh let's see so uh my best album is planet her uh by dojicat danceable fun kids love it i love it you dance i can't wait she's awesome you know that i have rhythm bro all all in summit dance party here we go from the waist down as you also know but just peep that out please don't cut that out no no it's not true no you cannot hide from the truth boys [Laughter] best movie is dune uh it was so beautiful um cinematically just gorgeous uh uh incredible incredible incredible movie and then book uh i've said it this before but the way i think about the world is using these models and frameworks one of the most useful models that i have found is this idea of mimesis or mimetic theory which is that people copy each other that causes conflict it was espoused by a philosopher named renee girard myself peter thiel there's a bunch of us who are pretty deep rene gerard acolytes the problem is that his stuff can be a little hard to penetrate and so there was a book called wanting w-a-n-t-i-n-g by this author named luke burgess superb book very easy to read very accessible explains this really well one of the most useful mental models that i have and oh just shout out we didn't have best comedian in here but i really enjoyed hassan minaj's the kings jester a new show that is not yet on streaming but that he's doing live it was hilarious um it was insightful and really enjoyed going to it did any of you uh like loki thor's step brother and they did a tv show called loki which was like a very challenging metaverse multiple timeline kind of concept it's gonna set the stage for the whole next wave of marvel movies didn't you think that was the best marvel product this year or no definitely it was absolutely 100 percent spider-man homecoming but i think it sets in line wait wait wait wait we haven't heard from sax did we hear from sucks yeah sax just picked like some right wing book it was like san francisco or something and then he doesn't watch tv or whatever i mean saks did you you actually love movies you've made movies did you see a film you loved were you just watching like films from the 80s honestly it's hard to find like even one movie that i want to you know write home about i think it's a lot easier to find tv shows like we're enjoying yellowstone right now quite a bit i don't know if you guys are watching that kevin costner nobody who's on the left knows what yellowstone is explain to people this right-wing phenomenon it's uh it's a kevin costner show i don't know if it's right-wing it's about a ranching like family like they're traditional sort of cowboys who live in wyoming and or maybe it's montana i'm not sure anyway there's all these people trying to go after them to get their land mostly developers and uh it's fantastic they're fighting to preserve their way of life which is around you know raising cows it's taylor sheridan who's the guy who did sicario which if you've never seen sicario one and two amazing are the most amazing thrillers you're ever gonna see i mean very hard to watch they're so intense and i think yellowstone now is the reason i say it's right wing is it's doing incredibly well in the south and it's not happening in the coastal cities so coastal it's kind of like a leave me alone it it very much appeals to the republic did the traditional republican slash american sensibility and now they're making it into a universe so they did a prequel and it's just off the charts it's the most viewership of any program and most people in san francisco new york and la don't even know what it is yeah i'm not sure it's like it has an overt political agenda i mean the family who's the the subject of the show the costumer character he's just against progress he does not want developers coming in there building airports building ski resorts he just wants to preserve his way of life which is how it's been for 150 years rustling cattle can't wait to see and uh i don't know how political that is but they are like very tough i mean it's like so it's like it's like san fran san francisco housing possibly yeah okay we're gonna keep up with this one this is our rudy giuliani award for self-emulation basically people who destroyed their legacy in some way or otherwise just bungled everything sacks i gotta go to you first i know that you've got your writing team uh over at uh fox and um has something going on here for this one let's go well yeah i i went with the cuomo brothers uh you know great pull yes so first you have the governor andrew cuomo remember at the beginning of covet he was giving these constant press conferences there was even talk about on the part of democrats replacing biden with him at the 2020 convention this inspired the term cuomosexuals who saw him as a sex symbol and then he got taken down in august by sexual harassment allegations then a few weeks later there's a major scandal at cnn when leaked documents from the new york ag's office showed that his brother chris cuomo had used his perch at you know at cnn to dig up dirt on some of his brother's accusers then he was suspended and ultimately fired so both brothers self-emulated within a few minutes of each other and andrew cuomo had to return his 5 million book advance for his covent book free break who you got who lit themselves on fire and uh well i i was a little general i kind of said you know all these politicians who made claims about the vaccine not being worth doing and then they got covered and then on the flip side of the aisle all the politicians who said take the vaccine or you'll get covet and then they took the vaccine and they still got coveted so you know i think again credibility institutional credibility and deterministic statements like that from both sides damaged a lot of reputations uh um and uh it's just brutal to watch you know from from one day to the next from elizabeth warren to rand paul people getting coveted making one claim or another about you know the the good or the bad of the vaccine and at the end of the day kova doesn't care clearly um so anyway what do you got your mother senator karen i think senator karen is the obvious choice for me kind of proved that she doesn't really know much about economics is you know kind of mean um and just basically wants to you know is a moral absolutist authoritarian just on the left by the way i just i'll interject because i'm so passionate about this right now since i've read this book but you know you'll hear you'll see in this book that um this populist diatribe that you hear from both sides whether it's the right or the left comes from a place that's driven by an allocation of a lot of the resources capital and influence and power to a small number of people um and whether it's senator karen or donald trump they ultimately end up being this you know the same characters played by different actors over time and the left and the right stand up with authoritarianism and socialism as the answer and the whole thing cycles over again um and we're in this moment right now and this sort of stuff that you guys are talking about senator karen and others kind of saying it's only going to get louder i'm convinced but i think it's interesting because i think she's overplayed her hand massively i mean she's become so shrill and such a scold that you know she can never win that you know that beer test quite remember that question they asked they pull people on about presidential candidates is who do you most want to have a beer with you know that that question actually is important because i don't think people want to have a beer with people who are scalding them or are these moral absolutists like jamal said there is a check there and um so i i think she's i think what she's done is backfired and uh for me it was biden i mean what a disappointing uh performance he couldn't control the far left of the party he couldn't uh get anybody on the republican side to give him but one vote he declared independence from kovit in july i know it's not a perfect science or anything like that but i think that this presidency is one and done obviously to everybody and um yeah he was supposed to go right into the middle and he has not gone anywhere near the middle or led from the front either way all right here we go my god jason how much fox news have you been watching she's just hanging out with you too much i'm on this thread with you no i mean it is possible you know i really wanted a centrist uh for president he presented as such and then he hasn't done that and now he's being forced into centrism kicking and screaming he should have just started there that's where he that was the promise he started there that's where that's where he's most comfortable anyways that's who he is exactly like what a head fake and now he winds up there anyway and it's gonna be too late uh so it's just a disaster um he he basically took victory uh from the jaws of defeat or took defeat from the jaws of victory right like just terrible okay here's an award i don't know if we're gonna make this but who was your favorite bestie so this is you picking up the three other besties friedrich this is your idea you want to create this division of why somebody is your favorite bestie on the show i was just trying to give you a shout out for coming to my party okay you know while the other bestie said i am your favorite bestie no but you know what yesterday chamoth served me crepes with nutella so he's my favorite bestie now so you don't remember that plane no and saks had an incredible um party and you guys i want to say all three okay i'll tell you something all three of you guys have been incredibly generous and i i feel fortunate and i know it's a little soft moment but thank you guys that's it i haven't had mine upgraded my emotion is complete i love you guys is cracking this is in my programming but i should keep it together the tear sub routine has not been installed jabot you want to uh pick your favorite bestie and or go around the horn and this is just a bad idea no i love all three thank you yeah i love all three of you but for different reasons um i'm really lucky to have all three of you as friends oh very nice i am very lucky to have uh two of the three of you have planes that i get to fly on right now and second homes that i get to freeload off of uh and friedberg uh you know actually i just say like you know i get as i told your mom friedrich at your wonderful christmas party i said you know getting to know your son has been one of the highlights of the last year and a half for me so sincerely you know i was good friends with jamal and sax but you know you and i uh knew each other from poker but you know not great friends or super close friends yet and i think it's been one of the highlights for me and i really have learned to love and respect um your opinions your ethos uh your effort in the world and in a world of people who are complaining and whining and not doing i just feel so honored to be able to be uh the moderator here and spend time with you every week i would do this if we threw the episode away every week because it's inspiring for me for the next six days until we meet again um it really fills my bucket it recharges my batteries to to be with folks who just aggressively want to solve problems in the world where are we taping this next week so that's in like two or three weeks we're going to be at the upfront summit on the second day in la i think it's somebody want to give the date i think it's january any plans to tape from uranus oh he set it up stop with the uranus if we can terraform it's the 24th to the 26th but i think we're on the 26th we're on the last day in the afternoon all in podcast we're doing it uh uh mark schuster invited us and then the all-in summit will be in may um in miami we have the dates we're about to announce uh but don't email me for free tickets there'll be 300 tickets to the summit uh 250 of them are paid and then each bestie gets 12 tickets to give to a bestie that's how we're going to run it everybody has to pay and then everything will be simulcast or all right everybody let's wrap up stacks i know you're not capable of saying anything emotional but let's give it a shot just for the for the audience i mean this is a real question this effeminate [ __ ] that you guys are what is this so brutal you're such an [ __ ] what a piece you are such an [ __ ] i i will say this this group a few relationships in particular had a very rocky year and so it's always yeah and something really youtube that is true it was not it was not public what all that went down yeah but but chamoth and i here we are here we are and i fought very hard to keep the pod together and to make sure that you guys and you guys are literally like the the two characters from step brothers and what your characters you're talking about in this part you and your mother yeah and it's good it's good it's good to see us you're the idiot who crashed the bunk beds the one on top yeah he jumps on top of the whole thing i don't even know what movie you're talking about what is the two of you you sax and j cal found a way to fight to almost break up to destroy everything we've built together free brook and i had to step in not once but on two different occasions and i had to spend mediating the two of you back together was ridiculous you can't spend the time either yeah that was a tough one maybe sax could stay in his lane no no no no no don't start don't start don't start don't start nick's reminding me of something yeah he says he said i got so mad at jason this year that i threatened to make uh nick a millionaire out of spite nick i want to make you a millionaire regardless i know your uncle's not going to do it he's doing great he's doing great he's got to carry you take it easy everybody no problem people still asked me to this day was that whole few with jake how real or was it just for ratings it was real i know it was all it was real the bigger feud was not a the bigger feud was not aired on the air and right there was a second future that one was out of control we signed at nba let's just say there's an operating agreement now yeah it's not easy you know success is hard for a band you know and i think one of the things i'll say about this whole brouhaha and the you know saks and i having debates about how to run the pod is i think we came to the right place i you know i look at the comments and i think i've become a better moderator i think uh saks jamaat freeburg you've all become great at passing the ball and showing interest in each other's points and i feel like we're playing you know which is always my wish for this is that you know we play this game as intellectually honestly and crisply and as well with as much discipline with as much hard work as like let's say the warriors do and i really feel like even in the last ten episodes we hit a high-water mark in the in the audience and everybody i meet tells me the same thing my god the guy's just doing such a great job i'll say one thing one thing that makes it really hard i i was i was with chamath yesterday as you guys know yes and secret mission one thing i observed with chamath is no matter how much success or wealth chamath has accumulated he is still a hustler and i think that that is true for all of us and individually and independently we all still hustle we try and make things happen we find things that others aren't doing we push right grind we grow up at 5 00 a.m yeah east coast yeah for a day and i think i think all four all four of us in the same are in the same vein and that makes it really hard for personalities like that to work together in a consistent way and that underlies a lot of what i think ultimately bubbles up to the surface with some of this stuff but um you know we should be thankful that we can pull it off because it's it's pretty pretty awesome and can i say something nice about jkl here we go so it's true that without jcal this pod never would have happened you are the podcaster in this group you are the math skills you make the pod very entertaining and funny and so like frankly even though you're not as rich and smart as the rest of us you should stop you should stop feeling so insecure because you really are the reason for this pod all right listen let me give a compliment saks you bring so many great notes to the pod and you are so eloquent based on what your team writes for you your ability to read that script and the amount of money you spend forming your opinions from tucker carlson's ex-writing team is just extraordinary so much to the table i can't believe i ever wanted to replace you with nobody's gonna know who i was threatening to replace sacks with it was like literally like we're gonna replace this guitarist boys have a wonderful holiday have a great one i love you besties okay everybody we'll see you all next week for 2022 predictions our promise to you no weeks off for the besties i'm going to be with you every friday night bye-bye bye-bye let your winners ride rain man david sacks and it said we open source it to the fans and they've just gone crazy with it [Music] we should all just get a room and just have one big huge orgy because they're all just useless it's like this like sexual tension that they just need to release [Music] your feet we need to get back [Music]






so i was not going to bring this up sack said bring it up no no no no no no no you're already creating mischaracterizations you said you want to bring it up i'm like sure i don't know i'm not going to veto it i said well you have to bring on my covid obviously i'm the second bestie to get covered and i told you offline without the other two besties uh i will just say i got it at a social function period end of story you said it's okay to talk about yeah it's not like i wanted to bring it up you want to bring it up and i'm allowing it because i i'm fine with it so go for it we all got something at saks's event you got covet i got chlamydia oh you guys went to the downstairs rooms downstairs you promised it was a great party all right let's let's hear jason's accusation i've been hearing about it all week in the chat it was a great party jason you were angry you were angry and you were yeah you were really mad at sacks because you thought he actually gave you covet even though saks had people test every single person tested on the way in except you jacob j cal you walked around the velvet i have and you said guess what i'm a bestie i don't have to test and you walk right in that party at the end of the day there's nothing one person that flooded the rules got it karma's a jacob nothing better personifies poetic justice i do not place blame on anybody foreign you make fun of him you poke him in this super spreader it was a gop superstar you go to his party and you run around the velvet rope and you don't get your test and you go in and you walk out with why should i have to test why should i have to it was really amazing i don't wait all night so i'm a bestie i think he walked out with kovac because i think he walked in with covet there you go he's the only one not to test so who brought it in test my daughter and i came to your wonderful party it was amazing it was delightful and we tested and no you didn't when when you got the party testing with me i had the bracelet i tested it a hundred percent well i remember when you got into the party and i said how'd your covet test go you said oh i pulled my bestie card i walked around i pulled my best picture that's not true that's true that's why you said that you guys are getting probably making up now no you said that okay i mean i may have made a joke but hold on guys and then i find out the reason why jade wasn't at the party she was home taking care of two sick kids no she wasn't we yes she was one kid all right here's what happened i went to the party uh i did test there was a group of people that got there early had tested at another event they told me this they tested before they got there and they told me that they had accidentally uh brought it with them because they were the first to have a positive test result so in all likelihood it was that group there's no it doesn't matter who brought it because omnicrom ominicron is going everywhere what is it um it's a it's a character from trade i don't understand that what do you mean they brought it with them if they tested negatives came from another location they tested they claimed they tested then they were the first to come up that next day with a positive result which takes longer 24 hours to incubate right so that means they must have brought it with them they they tested it on sunday and had it they were your supporters negative at the door they did not test at the door they told me they told me they tested the day before no everybody was just at the door oh you're trying to blame it on no i specifically have tried to not say the person's name and you're trying to include it's gonna get bleeped out it doesn't matter they were all negative at the time of the party you hosted a super spreader they didn't get it till like five days later so they were not the earliest detectives you tested positive you had symptoms before they did remember the tickle in the throat guys remember what he said last week he had the tickle in the throat anyway thank you for giving me um omicron i am now super according to all results i am now superman have you tested negative now not yet i i did a test yesterday nine days later i'm still coming up positive i had two days of symptoms not that any of you give a you rap bastards did you just laugh about my covet nobody had no point in this conversation did any of you say how are you feeling was there any chance of death was there any chance i was triple i had done modern yeah at any point though did you feel like oh i may have to go to the hospital no that's too bad i felt the tickle in my throat on tuesday he coughed three times he seems twice and prematurely ejaculated once those were his symptoms [Music] [Music] this is going to be our prediction show last week we did of course our 2021 bestie awards uh how did everybody feel about last week's awards i think it was great yeah i was happy it was a fun show i think we um we all got to kind of talk about stuff we wanted to talk about and uh and it was pretty dynamic i thought it was a good show i liked it it was like the greatest hits so uh we're going to do some predictions for next year are you gonna do a drum roll in a and a little scene as well yes okay here we go here's an opening but it's gonna be like flying into the future like going through space space warp speed warp speed biggest political winner 2022 what did tucker carlson's former writers uh tell you to say sex [Music] people were intrigued about what was the second battle about that was the big debate who knows i can't remember the battle about the beep beep which led to me writing the google doc about beep beep oh i know what it was then i deserve a better award for that who's your biggest political winner okay come on let's stop at the inside baseball my biggest political winner for 2022. i predict uh my man ron desantis will be the big winner he's up for re-election in florida he won uh in 2018 with less than one percent of the vote it was a real nail-biter this time i think he's going to cruise to re-election quite handily and become the national front-runner on the gop side and the reason is because he had the right approach on kovitt he made the vaccine available he made the antibodies available but ultimately he treated the population like adults he let them make their own decisions he kept businesses open schools open and i think the rest of the country is going to come around to his point of view because the unstoppability of omicron next year and so i think that desantis who is much maligned and disparaged will come out as the big winner a year from now all right who do you got free burke vladimir putin um i think putin's gonna benefit from the rising conflict between the u.s and china uh the other day there was a call between putin and um g and they said uh and and putin called g his dear friend and said that relations between the two countries had reached an unprecedentedly high level and i think that his position um economically as a trade partner with china and as a beneficiary of chinese economic prosperity will only grow as tensions between the us and china rise i think we're seeing that with some of his cavalier behavior with the ukraine right now and i think putin will become a stronger player on the global stage uh particularly as it relates to his relationship with nato uh over the next year um and he's been a little bit quiet the last few years he was kind of i'd say suppressed with sanctions and all the other nonsense that's gone on uh to keep him at bay but he could kind of rise up again in 2022 and and he could become a real player on the geopolitical stage globally um in a more meaningful way than he has in the last couple years i mean you you white guys love putin it's crazy the whites love poop i don't love it god i hate putin i mean if you ranked if you ranked russia gdp do you know even do you have any idea where it even ranks you know russian gdp is probably i mean you guys for the amount of time you guys give probably probably nigeria is like crushes russia nobody ever talks about nigeria has all the same inputs except they're black they just don't have 2 000 nuclear weapons i mean this is a big reason i mean it's a fallen empire for sure but they still have thousand nukes yeah they land the position the energy that it provides the only one in europe i mean russia is geopolitically pretty uh significant insignificant economically significant because they have a madman running the country i don't think he's a madman but i'm just saying that you know there's a there's a lot of ink that's spilled about russia and i don't think anybody even takes a step back and actually looks like who do you got for yours it's not true in the world guys uh my my worldwide biggest political winner for 20 to 2022 is xi jinping i think this guy is uh he's firing on all cylinders and he uh is basically ascendant so 2022 marks the first year where he's essentially really ruler for life and so i don't think we really know what he's capable of and what he's going to do and so that's just going to play out you think he's the biggest political winner really oh my god i think i think it's going to be a he's going to run roughshod not just domestically but also internationally because you have to remember he controls so much of the critical supply chain that the western world needs to be i think he's completely i think you're completely wrong i think he's losing his power he's scared that's why he took out all these ceos he's consolidating power because he fears that they're gonna win too big and then displace him and he has massive real estate problems over there that could blow up at any moment in time he could face a civil war there i think he's totally isolated himself civil war they don't even have a major country is removing their factories and removing this dependency there what are you talking about what are they what's that what are they gonna riot with uh did you not see tiananmen square did you not see the riots in hong kong are you not paying attention to moth there's been many riots in china to kill those were crushed and that's not saying it would be actually he still will have massive amounts of uh i believe protests and yeah i think i think i think the the bigger risk is is that china gets better for xi jinping but worse for everybody else in china it's already worse for all the billionaires uh over there it's worse for the tech industry you've now got evergrand that whole uh you know gigantic debt implosion i think there could be contagion from china next year i don't think she's gonna lose his grip in any way but i'm not sure china's gonna have a good year next year it's gonna be terrible um i went with ron desantis with you sax i think he's obviously um a much more um he's a much more palatable candidate than trump and i think trump is not going to want to run and that brings me to my biggest political loser for 2022 as we segway i believe this is going to be split between biden and trump the two most important people of the last uh four years and i think biden is going to lose the midterms and i think trump is going to get destroyed with this january 6th thing and uh bow out and not run again who do you got for your biggest loser let me add an octogenarian to that which is my my pick for biggest political loser next year is nancy pelosi i there's a red wave coming the democrats for sure are going to lose the house that is baked into the cake and i predict she will announce her retirement shortly after that she has served you know a couple of pretty consequential terms as speaker she's never lost a vote but with this whole build back better she forced all her moderates to take a vote on five trillion in new spending which they then lost in the senate and that's gonna cost them some seats so she contributed to i think her own downfall that's going to happen next year is nancy to come work at social capital and you're going to give her a bucket of capital to work with to try to play the market by the way jason who's the excellent writer you got from tucker because i want to hire them all right listen i uh i got somebody from the youtube comments who said they would they would punch me up all right i got biden and trump nancy pelosi uh and then who do you got freeburg who's your biggest political user of 2022 prediction mine's a little uh depressing but i i'm honestly a little bit worried about the united states influence on kind of a global stage socially politically economically and i think that there's a number of events that could catalyze kind of a precipitous series of events um that could really harm the continuing influence the u.s has geopolitically so i i um you know i don't really have an individual but i kind of have the us and it's and its role on the global geopolitical stage u.s influence u.s influence yeah and you said you thought there was going to be this uh potential tipping point perhaps you see that being taiwan or what i've got a couple of them i think when we get into our contrarian points of view i'll share some of them okay uh chamath who do you got for your biggest political loser for 2022 prediction well look i uh i like your pick of trump which is not mine but just a double down on this trump thing it's incredible to see that he's just a bamboozler you know that's the same guy who's like you know telling people to not take the vaccine gets boosted then you know when he finally gets outed with this other scumbag what's that guy's name what's that other right knob sacks take out your phone and go to speed dial just read it those two dopes on stage are like yeah i got boosted what about you yeah i got triple facts then and then everybody's booing them i mean they're just such watch what they do not what they say guys the great thing is they are phenomenal entertainers but you can't trust a single word that they say so uh jason i i think that that's a pretty good pick my pick is the progressive left um as a class because i think these guys are being exposed basically for just being laughing stocks they'll be quickly becoming policy jokes inside of washington and in every city state that they run they just can't seem to put one foot in front of the other and they've been run amok with folks like these teachers unions who have really really really done a number on our children which is now finally getting exposed in the mainstream media and so all of these policies are just they're not rooted in any sort of science or legitimacy so they are i think going to pay a pretty heavy political price for mainstream voters in 22. you know what they remind me of those two guys like uh the old guys from the muppets statler and waldorf that's what like those uh trump and uh o'reilly are okay i think biden can still save save a lot of his long-term reputation i think trump's what would biden need to do in 2022 number one he needs to disavow the the progressives and basically shore up his party's ability to win back some seats and hold the line and so how would he do to be able to enter some of these places with some of this rhetoric that you know he basically was convinced would be necessary for him to not lose the progressive left there just needs to be a conversation inside the white house where they actually go through the cold political calculus of you know my enemy's enemy is actually my friend kind of thing and actually go back to the center yeah he needs to pull up bill clinton then trying he needs to pull brooklyn okay and quickly too i think it's way too early to conclude that the bind presidency is over i mean i think i think they're gonna lose congress next year that's baked into the cake but he's still got two years after that to pull his chest outside of the fire and if the republicans overplay their hand and he tacks towards the center you know he can change his fortunes he can change his fortunes quickly he's down a pawn but he could develop the board i got him all right i think the voice of populism is only going to swell over the next year and um that that's going to be the predominant force that's going to drive both the alt-right and the progressive left and it you know you could make the case that you know politicians that are in seats should be kind of disavowing these what we today are calling kind of extreme voices but they're only getting louder and the importance of kind of populist movements not just in the us but you look around the world i mean look at what's happening in brazil uh various european countries i mean it is like so you think populism is going to have a a rebound in 2022 we're all saying that we think it's fizzling well i can i just say free breakfast i think populism swelling and i think it's going to get louder and okay low interest low interest rates are simply keeping things at bay for now and i think that's going to shift very quickly and um populism just means what's popular and so i think there's a huge silent majority that's always stayed on the sidelines because they're not the ones that that are tend to tend to have a tendency to complain but when things get important enough they typically show up and so you know we may find that actually centrism is what's most popular i think populism is um anti-elitism and i think that there is a growing concern globally because of globalization that power and capital has been concentrated in the hands of a few that the voice of the majority is we want to be shared we want that to all be shared equally and that's what's driving populism around the world and it's in the us you know manifesting in different ways on the left and the right and you'll see this in other countries around the world but i don't see the fundamental driving forces changing there until and unless we have massive taxation and redistribute wealth in a meaningful way or some massive shift in government um that that voice is gonna get any quieter i think it's only gonna get louder and there may be perturbations between here and there of like what it looks like but it doesn't seem to be going away that that's that's just to me kind of the underlying driving force and it's manifesting with different political stuff right now but interesting um it's not it doesn't seem to be silent biggest business winner for twenty twenty two month let's start with you small businesses um i think what we are starting to see is that these monolithic monopolistic megacorps aren't everything that they're cracked up to be and so there's going to be a certain amount of lock-in that we will tolerate there's going to be a lot of taxation and policy that prevents its further growth and all of that opportunity accrues to smaller companies and so in general i think that if you are on the side of the david versus these goliaths over the next year you're going to have or well frankly over the next several decades but starting really next year you're going to do really well and the middle companies so the folks that are neither huge nor are small let's take a you know an example like a shopify 100 billion dollar market cap but by no means is it a trillion dollar market cap their success comes from enabling you know arming the rebels and so i'm a huge fan of these enabling this enabling layer for small businesses both offline and online who do you got freebird um i am actually gonna go with stripe stripe is a payment technology company based in san francisco uh stripe raised money earlier this year at a 95 billion dollar valuation um the highest valued ipo tech ipo in history was alibaba they were valued at 230 billion dollars when they went public we are hearing rumors that stripe might you know kind of or think that the bankers think they might be able to break that and so stripes ipo could be the biggest tech ipo ever um i think they've been talking about doing a direct listing by the way i don't know the guys i don't know the investors i don't know the company i'm not an investor so i don't have any information whatsoever i'm simply an observer and and talk to people in the market but it sounds like they're going for direct listing and we could see that become the highest valuation tech ipo ever and then they will become kind of the golden child next year uh and you know kind of be be part of the you know the the top of the top what do you got sex i got rise of the rest meaning the parts of the united states that are not the traditional california new york centers of industry and wealth i think it's a trend that's been going on but it's going to keep getting bigger next year if you guys saw the net migration numbers by state they're absolutely stunning stunning so and it's the it's the zero tax states that are just booming right now it's states like florida and texas and tennessee and on and on it goes at the huge expense of california and new york i think that trend's only going to pick up steam now that salt is dead i think there was a hope on the part of many people that you know trump got rid of salt but and the democrats were supposed to bring it back and then aoc rejected it it's not coming back and what that means is that if you're in safe california for example you know with assault deduction your effective tax rate was around eight percent not 13.3 percent now it really is 13.3 percent that's a huge increase and the politicians in california don't even realize that the tax rate has effectively gone up to the end taxpayer and uh and and the quality of life isn't any better we're not getting anything more for that and so i think this x is coming so that's that's the subtle map that they actually really need to understand that 500 basis points you can overcome that if your life is five percent better in enough ways where you're like it's fine and the reason why people are leaving is they feel that their life is actually much less than five percent worse right if the traffic light doesn't justify it you know your windows are getting smashed in all the time safe your kids are you know depressed and need counseling because of the way that the teachers unions lock them out of school you're just like forget this i can't do this anymore right you gotta add those two numbers yeah you're here that's what that's what people really need to appreciate i don't think it's the actual effective tax rate but it's the delta of how poor your quality of life has gotten over these last few years relative to the tax you pay yeah i totally agree with that and then one other effect that i think plays into this is the reshoring of american industry which is not happening in places like california new york it's happening in places like texas sure samsung just announced a 17 billion dollar investment in a new chip foundry in texas here i'll post this and there's a lot of things like this happening so as we decouple from china and bring our supply chain home let's go that is going to be a big factor in the rise of the rest love it love it it it's great it's great for america because the wealth does need to be more evenly distributed it can't just go to tech and finance elites in california in new york yeah all right um i had two uh disney was my uh biggest corporate winner for 2022 disney plus crushing it parks raised prices people want to go to the park spider-man just had i think the number two or number three all-time opening in a pandemic which is crazy that ip is going to continue to work for them john favreau and david fiolini i think is how you pronounce his last name both crushing it with mandalorian boba fett one of the great characters from our childhood now is going to have his own book of boba fett starting on december 29th is that today or tomorrow uh tomorrow and so i think disney's gonna have a huge surge i think they're undervalued but my my number one for this category of biggest business winner for 2022 was millennials in gen z i think that they became completely empowered and independent they shook off the participation trophies and their entitlement during covid they realized that they have skills that are valuable they're sought after they learned how to make money they traded crypto they did stock trading they're doing shorts puts whatever on robinhood and they're just not impressed with people in power and they increasingly want to build and make money i think that those two generations have woken up and i think they're going to be the biggest winners in 2022 because dovetailing with your smbs chamoth i do think uh and i'm seeing it across my entire portfolio of companies uh you try to hire somebody and they're like yeah but maybe i can start my own company and sacks are actually saying a flavor of the same thing actually yeah because all these smbs aren't gonna happen in new york and san francisco they're happening all over america and they're people that are taking empowerment into their own hands there's tooling for them and there's opportunity economic opportunity for them to build businesses on their own and basically just say you know few build your nothing builds your confidence like moving from one city to another and having that's a very empowering thing to do when you're just like you know what i'm going to just leave and go somewhere else i'll make it myself so i feel like they are uh super impressive to me i really believe in i really believe in this because the three of us got there in totally different ways but i think it's roughly all the same we might be triangulating around a trend here biggest business loser for 2022. i'll just give it real quick i think crypto projects that actually don't deliver a product in 2022 are just going to be um lost i think this idea that people are going to bet on things that don't exist in the real world or don't actually have applications is going to end it's time for crypto to put up or shut up and i think the crypto projects that do that which a number of them are starting to are going to soar but it's going to be a big shake out there what do you got for biggest business loser in 2022 freeburg i agree with you actually that was mine yeah oh wow i said crypto bubble will burst there's a lot of scammy nonsense going on 90 of these projects okay you know are not going to yield value and fundamentals and i also think that rising interest rates are going to affect the crypto market there's a lot of leveraged trades into the crypto assets those will start to deliver as these interest rates shift up and as a whole you'll see a large percentage of them go away or decline in value but a small number will continue to grow in value just like we saw when the dot-com bubble blew up there was a number of companies that survived most of them did not and the few that did survive ended up being coming worth 10 times what the current market value is and i think that that's still possible with these crypto projects but uh i'd say 90 percent of them are probably going to start to blow up next year what do you got your mother well i guess i'm fading you guys and i'm also fading implicitly friedberg's pick of stripe but my biggest business loser for 2022 is visa and mastercard and traditional payment rails and the entire ecosystem around it so i think that this is the year you can put on what probably will be the most profitable spread trade of my lifetime which is to be short these companies and that anybody that basically lives off of this two or three percent tax and be long well thought out web three crypto projects that are rebuilding payments infrastructure in a completely decentralized way now that doesn't necessarily mean that what you say won't also happen both that stripe will have an incredible ipo and that a lot of these scammy crypto projects will go to zero however if you read the white papers of these crypto projects and you systematically put together a framework i think you can be long those and you can be short visa mastercard because i think this is their peak market count and for those of you don't know fading and sports betting taking the opposite side of a bet taking the opposite team i guess man visas market cap is half a trillion dollars huh it's incredible it's a completely contrived duopoly and what does it mean to a young person and mastercard's almost 400 billion so they're trillion dollar combined market you have to understand that the canary in the coal mine here is pretty significant the most important thing is amazon earlier this year nick maybe you can post this decided to just shut visa off in the uk oh yeah now amazon is not going to do something like that in my opinion unless it's a test of what they can do all around the world and again going back to this idea of arming the rebels there really is no need today for all of these small businesses to sit on top of visa mastercard and amex rails it's unnecessary and so it'll probably get developed in the developing world first this is why i think you know focusing in markets like nigeria to me are way more exciting than talking about you know these fading western european countries who cares right this is where this stuff will happen um it's not to say that those are those other companies can't you know trundle along for a while but when i say you know we'll look back in 10 years and their market caps will be materially lower anybody in those traditional infrastructure and rails versus anybody in this new infrastructure in rails will be it will look like a no-brainer do you consider the buy now pay later companies like a firm and upstart or whatever i don't know if upstart fits in that category but some of these buy now pay later businesses as being the alternative to the traditional payment networks or do you think that it's a different business no i right now i think what what by now pay later is is is a rate arbitrage right when as you said earlier rates are very very low so the cost of capital is low but it again starts to habituate the consumer experience to i don't need to pay these users rates to these three credit card companies to facilitate a transaction of money that i already have or money that i'm good for that's the big idea right and so when you translate that into web 3 in a good project or a good series of projects you're not going to need these companies and so it's going to i think eviscerate trillions of dollars of bargaining you also have in between these two venmo and cash app which are not crypto but they certainly as brands mean more to you this is why like do you think yeah do you think block used to be called square is a good fair trade against visa mastercard in this context yeah i like it you know i think that that that starts to get closer to to the truth my perspective is you can kind of short anybody who's public because anybody who's public can really only be public or will go public because they feast off of this artificial two or three percent transaction fee everybody does the companies you want to belong are those private companies in crypto that you can read the white papers of whose protocols have utility and who's building some element of infrastructure that replaces a traditional business so as long as you can kind of build those things up biology for example had a bunch of tweets this weekend where he was like you know i he has this idea for a mirror table what is that that replaces you know cap table management right now why is that important well it because it touches all of these really important kyc aml investing laws across all these countries in all of these places it's just a very simple example of where the new company that actually builds that capability of these mirror tables will do so at virtually no cost and so it'll have a 50-person team and so they're not going to have offices all over the world their cost basis will be you know an or order or two orders of magnitude let's face it visa mastercard became a tax and you can't compete in decades to have that power over folks but i think a firm does break that a firm breaks it because the people who are selling then decide you know what we'll give a little bit of a discount here to get more people to buy go ahead they were the classic network monopoly network effect monopoly business right like they got the small businesses they got the credit cards and by extension the consumers on the network and ultimately they created these these absolutely locked in networks but as with all networks complacency kind of you know drives innovation and this field innovation that we're seeing is now starting to figure out ways to not just crack their way into the network but to replace them with an entirely different model last point on this this is not one where i think this disruption happens slow i think it happens swiftly swiftly being five to ten years no like in a year yeah chamoth's point is really interesting because there's you know there are several billion people globally who do not have credit and who are unbanked and so if you think about where this is more likely to come from it's more likely to come from an innovative model in those markets that then ultimately finds its way into the developed world versus you know trying to break apart visa and mastercard and go get these small businesses to switch out of them and so on uh today so it's it's really interesting okay sax what do you got i don't know if it's biggest loser but the thing i'm most worried about is in 2022 the fed is going to stop quantitative easing or so they have said they are i guess march will be the last month in which they do this qe so starting in april there won't be any of this liquidity pumped into the system and so i think the the losers are going to be any of these asset classes that are heavily dependent on or have benefited from all this excess liquidity sloshing through the system uh it's true that the stock market i think has already priced in rate increases and an increase in the discount rate but i don't know if markets can fully price in a reduction in liquidity we don't know exactly what that's going to look like and so if liquidity is reduced next year i think that could reverberate through a bunch of markets including you know everything from sports cards you know collectibles which have gone through the roof to art to crypto to you know maybe some growth stocks and on and on it goes so that's my biggest worry is what happens when the fed stops qe and the biggest loser is markets because of uh quantitative the markets that have to get off drugs basically okay most contrarian belief uh saxophone tell us your muscular and belief since i'm sure that you workshop this with the contrarian peter thiel himself it never ends yeah i mean so i i have a couple of them here actually you want to wait and go after everybody else sure yeah go ahead uh i don't even know if this is contrarian or just unconventional but i think that all of this pressure in on the progressive left will manifest in the chosen one aoc deciding to step up and run against schumer in the primary in june of 2022 and she will lose wow that's a good prediction i like jamaat's prediction that's a bold one yeah that she would lose is well sorry just to give a little bit of color in this like let's just assume that she doesn't right and and you know that she shouldn't but let think about where she's sitting build back better is over there's an enormous amount of stuff happening right now where you know it looks like the progressive left is really going to be put under pressure and it's almost as if if she's really going to be the standard bearer and she needs to do something quickly otherwise she's going to have to wait until she's 38 you know she's you know another six years from now because it's not unlikely that she's gonna run against kristen you know kirsten gillibrand so this is kind of like it may be a moment where out of her sheer frustration she steps up and then we will see whether freeberg is right or i'm right whether the populism is really around the left or the populism is really around the silent majority what do you got sex i think i think that's a very good prediction um in a similar way i predict that there will be a strange new respect for bill clinton in the democratic party by the end of next year why because after the red wave there'll be a recognition that they need to move towards the center they need to triangulate and and clinton was the one who provided the formula for doing this he dragged the democratic party back to the center after they were losing elections and the other piece of this is going to be that it's already the case in polling that hispanics and asian americans now are swing voters and i think you're going to see in november 2022 that they go for republicans of big numbers and so the idea that the democratic party can just coast to election based on demographics i think that theory is going to be imperiled yeah and so and so they're going to be looking to clinton and maybe not so much obama as the as sort of the predicate they should be you know aspiring to in the future i think what's important about that is those groups of people i think are offended by the free money get something for nothing they're hard-working immigrant people who have pride they don't want handouts and then you have this left white liberal maniac saying no no you're poor you need handouts you don't you shouldn't work you need handouts you're you know uh and i just think they don't buy it and that's why i think they're gonna go to the republicans because republicans are hardworking and freedom-loving and what was clinton's big tagline in his campaign he he said that he supports people who work hard and play by the rules that was that so crazy that's the message the democrats got to refine right now they seem to be on the side of basically drug addicts i mean you know people who junkies are contributing nothing and pitching tents in the middle of public spaces and you know participating in open air drug markets yeah what do you got free and sore losers don't forget sir losers yeah and hysterical free burgers and hysterical people i mean being hysterical just never good luck if you'll bear with me i have i have three but um uh i couldn't really pick so the first one is i think and i shared this on the pod the other day i think we'll see the start of um great global conflict we we often rationalize the series of events that that catalyze conflict after the fact rather than recognizing that there was emotional conditioning that allowed it to arise in the first place i think we're in a state today where the conditioning is such that we're more inclined to engage in conflict globally than we have been in a very long time i don't know if it's kind of the conflict meter or what have you but you know you could see proxy wars uh and proxy conflict that arise sort of like what we're seeing you know maybe something in in the ukraine maybe something related to taiwan but this is primarily predicated by the fact that we've got uh kind of this inflationary environment and the rise of populism will force the kind of domestic policymakers and legislators to say we should do something that's active and something that will allow us to unite our nations to go and get into a conflict somewhere or more likely to do that than not and so i would say that the conditioning is there to see something like that happen and so we're not kind of thinking hey next year's going to be a year of war and that's why it's contrary and i think that there may be war that we're not kind of paying attention to today or that will surprise us after the fact the second thing is i'd say china may solidify its position next year and this is going to sound a little crazy as a leader in climate change mitigation whereas it's historically been considered kind of the primary foe against climate change and there's a couple of behaviors we've seen come out of china recently that i think number one remember china's a very rational actor they do analysis they make decisions based on long-term investments in thinking they recently announced that they're going to build 150 new nuclear reactors over the next 15 years at a cost of roughly 450 billion dollars that's about 3 billion per nuclear power plant the us is currently spending 30 billion dollars building two power plants in georgia so the chinese have figured it out they've also publicly declared that they're going to be completely carbon neutral with their economy by the year 2060 and they're making the investments through these nuclear power plants to demonstrate that they're actually on the road to do that and there are a number of other infrastructure initiatives that are meant to help them achieve significant reductions in uh in carbon by 2040 so so let me just point out why this is important because right now everyone thinks china's the foe they're causing climate change they're the biggest problem imagine if over the next year some of what they're doing pays off and everyone says my gosh china is leading the world in climate change mitigation their influence socially and politically will rise and this this gives china a very strong kind of position you know on the global stage and with with kind of people around the world thinking instead of china being a foe maybe they're the leader and the u.s is the laggard um and that creates a my third is very random which is some sort of natural catastrophe we we never account uh you know all natural catastrophes are very low probability but very high severity if you multiply the probability by the severity you have what's called the expected loss we always undervalue the expected loss of massive catastrophes natural catastrophes we haven't had one in a while uh it's a very low probability bet for me to say hey maybe we will but if we do um it's certainly under-appreciated in markets today and so when these kind of you know black swan type events occur did you uh did you watch don't look up on netflix is that why you're no what is that it's a new movie about uh crap don't watch it uh it's it's polarizing let's leave it out for now okay um i'll watch it it's crap my most contrarian belief is i think this is contrarian is that american influence and exceptional exceptionalism is going to soar i believe that is contrarian uh i think we've empowered this next generation as i talked about earlier millennials gen z are ready to be independent to build and i think gen x is going to start taking over from boomers as is what's happening in this very podcast here as we start to hit or reach time years as executives um and then all these boomers are retiring as chamath has pointed out over and over again and they're going to pass down their wealth which then creates a perfect storm of a ton of capital a ton of energy lots of new ideas a different perspective when the economy is going to boom uh and we will prove once again that we're the greatest country and economy in the world jk you're not you're not a contrarian you're what we call an optimist yeah okay and then i'll add to that jkl what are we are we gen x we're gen x yes and the fighting over covet abortion guns social justice and all this stuff is so exhausting not that these are not important issues that i think everybody is going to move to let's just start respecting and building and solving problems and i just think american exceptionalism will be um all that happens in 2022 i just think that that is my contrarian belief for 2022 everybody believes it's a primary race i think everybody believes it's coming apart i don't think anything's coming apart from the next century in a year i think it's going to be a great year i think it's going to be a great year can i give my second contrarian prediction oh god here we go yes okay it's good here it is i think the media the media is going to pull a total 180 on kovid okay so after pumping out coveted fear porn for two years they're gonna change their tune next year um some of the things you're gonna hear we need to live with covid it can't be eradicated they're even gonna say it's it's more like a cold or flu they're gonna say that politicians can't be expected to stop it they're going to memory hole their support for lockdowns we never supported that and why is all of this because we have an election next year and more americans have already died from covid under joe biden than donald trump that's appreciated memory hold what was your term yeah you've never heard of the term memory hole it's what the problem is got it yeah but did you guys know that that more americans have already died from covet under joe biden under donald trump that is stunning yeah it is stunning are you sure yeah 100 now his writers triple fact checked it yeah they did they did no look look it up um and it's certainly it's going to be even more true worse.com now look i don't blame joe biden for that sorry wait why is that because trump had no vaccine and biden has had vaccines and everything else maybe it's the consistency of them we've had a consistent you know one to two thousand people die a day fourteen hundred a day so maybe it's just that consistency in the us yeah i think it's because of the republican states that refuse to do any mitigation okay let's keep going look i don't blame biden for that i don't blame any president united states nonetheless biden campaigned on the idea of he's quote unquote shutting down the virus um he he and the democrats claimed to that they would be able to eradicate it that was the entire basis for all these coveted restrictions now it's it's the case that it can't be done everyone's realizing that they're gonna have to move the goal post a memory whole ever saying that and so the democrats desperately need covet to be over for the 2022 midterms therefore the media will say it's over well you started to see it already because the media is probably scratching their head they were the ones trying to force these lockdowns you know basking in the glow of whatever press release the the centers for disease control would put out and all of a sudden the cdc just had to do a complete 180 and when they used to force 10-day quarantines for these positive tests and people with covet they just backtracked to five and why was because there's nobody to work yeah the delta ceo asked for it last week and now they're i don't know if that's exactly true the cdc ultimately really is just in the hands of big business and so when big business needs these workers to come back you know they and it probably pissed off a lot of unions who would have loved to have just had a positive test and stay home forever the teachers unions particularly here we are so this is a really tough situation well and look and to be clear the message that the media is going to deliver about kovid next year it'll be the first time i agree with it but it's completely dishonest to them to pretend like they were never in favor of lockdowns and they completely inflated the threat and created this whole hysteria and next year they're gonna have to back off but also take it because no politicians that this new variant is much less deadly so it would be logical for people to take a less severe application on it now hold on jason we don't know whether there are more variants to come in the future that could be much worse the cdc makes a decision broadly speaking about everything they're not making a decision about omicron they didn't say if you have omicron because not only if they really even test for it i'm just talking about the reason they shortened this is because they didn't know what they were doing before they don't fundamentally know what they're doing now they're making best guesses and the problem with these best guesses is that they're inaccurate and it forces enormous amounts of waves of havoc every time they make it you know what i'm talking about i'm talking about sax's prediction that the media will flip a logical person including everybody on this call because of omicron taking over for delta and being a natural blocker it would be the logical thing to do so in defense of the media which i'm not apt to do it's logical for everybody to take a different approach right now because omicron is 40 times more contagious it blocks delta and it's become the dominant variant i think right now the media is confused they're not sure which way to go so you know there's a high probability that they tacked towards what sax is saying but if you read the new york times article it was through gritted teeth they presented the fact that the cdc changed the guy yes if you read that article it was like pulling teeth what do you mean when you say the media can you just define that a little bit it's everybody about fox news come on it's the elite prestige media it's the new york times the washington post cnn msnbc on and on and on do you think there's a bigger audience with the aggregate of those publications you just mentioned or the direct to the consumer publications that are happening on youtube of course they're being disaggregated because of their dishonesty so does it matter yeah of course it still matters because they still have a lot of influence they do and no offense to everybody on youtube but we haven't gotten yet to the economic viability where enough people on youtube can cover the broad spectrum of things that are important and then the mechanisms and incentives to amplify it so for example that's a good point we still need cnn there was a woman on cnn nick please post the clip that you we posted in the group chat talking about the incidents of suicide rates and depression in our children and what happened when they were locked out of school for two years okay and i am not going to stop talking about this because this is the issue of our times these are our kids well i want to get to under-reported stories uh as well jan oh for me i mean my kids hear me rant about this every day so i may as well tell you guys it's it's the crushing impact that our covert policies have had on young kids and children uh by far you know the least serious risk for serious illness uh but i mean even teenagers you know a healthy teenager has a one in a million chance of getting in dot and dying from covid which is way lower than you know dying in a car wreck on a road trip but they have suffered and sacrificed the most especially kids in underrepresented at-risk communities and now we have the surgeon general saying there's a mental health crisis among our kids the risk of suicide girl suicide attempts among girls now up 51 this year black kids nearly twice as likely as as white kids to die by suicide i mean school closures lockdowns cancellation of sports you couldn't even go on a playground in the dc area without cops scurrying getting shoeing the kids off tremendous negative impact on kids and it's been an afterthought you know it's it's it's hurt their dreams their future learning loss risk of abuse their mental health and now with our knowledge our vaccines if our policies don't reflect a more measured and reasonable approach for our children they will be paying for our generation's decisions uh the rest of their lives and that to me is the greatest under-reported story of the past year and i don't see it being talked about anywhere we talked about it first you know i posted that link about the decrease in iq points and then we started to talk about it there slowly and now it's trickling into the mainstream media where they're forced to talk and who's impacted it's not rich kids it's a common kind it's all of ours that was a fantastic clip that cnn clip was fantastic the ones who are the ones who get hit the hardest they can't do supplementals don't don't minimize what this is this is every child yeah very disproportionately effective the data was that it's disproportionately affecting minority kids yeah okay and that could be because of the sociology of the parents but jason you can also have rachel's parents okay jay so i'm just saying parents i'm saying all poor kids white poor kids who are public schools poor kids they're getting hit by minority kids of all kinds but frankly the point is it's all kids of all kinds okay so we don't need to sub-segment this to make this issue go away and seem smaller than it is we have literally put tens of millions of children yes at risk because of our behavior yes i'm agree with you and i'm not trying to minimize it or make it a smaller issue your point is that none of the smaller audiences um or smaller new media folks on youtube or their podcasting have enough breadth to really make an impact by talking about this topic is that what you're saying that the mainstream media is needed to hit the broad base no what i'm saying is very specific the people on youtube cover what the people on youtube want okay the people on podcasts cover what they want they're all very narrow their narrow niche okay yeah there is no set of incentives that then threads that together and then amplifies right in the absence of those two mechanics right those are software mechanics and economic mechanics that need to get built in what we lose is signal right that in my opinion right now over the last two weeks is the single most important signal and it is nowhere except for this one clip on cnn and the discussion that we had two weeks ago because the youtube i just want to be really clear on this because youtube is full of react videos right and video games which is fine and the concern is missing yeah is talking about this issue and actually holding people accountable and who should be held accountable in every single county where it was basically a board of education that was trying to shut these kids out who stood up and who told that story nobody did and if it was trying to be told it wasn't amplified correctly enough and so what happens is after two years of damage to all of our kids tens of millions of kids there's a couple of fissures one fissure was on this podcast which i'm very proud of another fissure was this one few minutes ago cbs cbs whatever which is sunday show yeah but my point is these are the things that really matter and we haven't figured it out yet what you're saying and i think it's a really important point is that as a youtuber as a podcaster you pick your niche that you can hit home on and you hit home over and over every week but no one says i'm gonna broadly talk about the issues of our time and make sure no no that's not true we do we do but it's it's a small subset but i think the bigger pictures there's more than a million people a week that listen to this we've we've far exceeded msnbc's average viewership we're probably going to pass you know most cnbc shows and some cnn shows by the end of next year so we will do it but there's not enough there needs to be more of us we're an opinion show as much you know we're not a traditional reporting show right in the sense that like go out gather data and facts and present them or do you disagree with them not that they do that anymore i disagree with that i disagree i actually think we do a decent job of filtering for the truth and the reason we're able to do that is because of our friendship we can hold each other accountable and call out the when we see because we don't have incentives we don't have anything to lose right i don't think there's anyone here but i want to build on something that sack said see it is very hard for the media to hold this dissonance because they're saying everybody needs to shelter in place covid is you know this huge thing they put the death count they put the case counter up they won't talk about debts in icu they won't talk about who's getting coveted because they have an incentive to get more ratings through kovid or trump and they took that and then it's a narrative violation or it's cognitive dissonance if they say at the same time everybody needs to shelter in place this thing is really deadly but we should send our kids to school so they couldn't take that position sax and chamoth they couldn't take the position that oh well kids could go to school because that would go against hey everybody needs to shelter in place and they picked i think covet is this super deadly thing everybody has to shelter in place over children you're giving them way too much credit i think what happened was they had a position to re-aggregate lost power and they took it that's real sense they did not think about the true consequences and it may not have happened at any one individual reporter level but when it ladders up to the editorial board and the decisions of the people who run the mass heads of these organizations they made the decision that currying and organizing power was more important than shining a light to do the right thing specifically in this case the thing that aggravates me the most is around our kids yeah i think they were going for ratings but anyway we can keep debating it well one thing we can say for sure is they created a hysteria whether their motivation was ratings or a power grab or political advantage there was probably all the above but the bottom line is they wanted to create a hysteria and they've been pumping covid fear porn into the population for the last two years but my prediction like i said is that it all flips next year why because there's an election and the way the media figures out what it's gonna what its narrative is gonna be is they start with the election result they want and then they reverse engineer the narrative that they think is going to help achieve that election result and if it means contradicting what they said yesterday they will memory whole what they said yesterday in order to get on board the new narrative that is what's gonna happen i do think you're right but i think i just i wanna i don't wanna lose this threat because this has nothing to do with covet meaning covet was a symptom of this but if you really thought that the organized mainstream media had the right to be you know has a purpose to be on the right side of justice where were they when when school boards were stripping out you know advanced placement programs for kids or where were they when they were shutting kids out or where were they when they were engaged in eight hours they can't go against whether you know a male can be on a committee you know because he's gay but he's not you know black i mean these were the issues that stopped our children from literally walking into the classroom every day well i mean they just those stories were not told and they didn't happen just in one place they happened all across the country and this is where those folks had a responsibility because they also probably had kids and they didn't do a thing about it that one issue for me really drives me crazy let me ask a probing question here we assume we're going to get out of this um you know pandemic in 2022 knock on wood no more variants what is the obligation and technique the strategy to solve what we did to these kids and i just want to put out there we don't have to answer it now but i think we could spend an episode that's a very difficult question jkl that i think you need so sociologists and psychologists and educators we also need entrepreneurship and ideas and we need to have a dialogue so we can bring them on but if we're going to spend all this money on buildback better how about we build back the 20 loss iq points that these kids have and then we do something about the depression and anxiety they have hallelujah jason we're never going to get there because the teachers unions won't even acknowledge that learning loss exists the leaders we need to break the teachers unions period yes oh let me make a prediction in that regard next year there is going to be a ballot initiative in california to before school choice and the way it's gonna work is that i think there's something like thirteen thousand dollars spent per pupil in california that's right that's right there's gonna be there's gonna be a ballot initiative that says that any parent who wants to send their kid to an accredited school can get a voucher for thirteen thousand dollars from the state that's just gonna be on the ballot competition let's go i predict it will be the big big election in california and maybe the nation next year and i think more than 100 million will be spent on both sides of that thing and i i can't predict it's going to win i hope it does this is a topic worth fighting over this is something important to fight over yes absolutely it's school choice because you know what absolutely these guys pulled the wool over everybody's eyes they slipped them the mickey they hoodwinked them you need choice we know this as entrepreneurs if there is no competition things do not get better these school unions are complacent well let's make a resolution let's make a new year's resolution because i think we all agree on this um i got approached about this ballot initiative it's it's going to happen there's going to be like i said a major ballot initiative next year for school choice in let's get california it all in summit profits we'll put towards this yes let's do it let's pull i'm in i'm in let's put some money behind this i want to tell you just to more personalize this issue because i really think a lot of people listening struggle with this i entered the pandemic with rules i had rules about devices i had rules about you know how much time they could be online i had rules around physical fitness right i had rules around diet and it all went out the window and it became this thing where it was like feed them the best they can sometimes they eat lunch with us sometimes they have to eat lunch by themselves because i'm stuck on some stupid zoom you know back to back in these dumb meetings because these kids aren't at school their only way to interact with their friends became video games like fortnight where they could at least talk to their friends yeah but then it became an addiction where they were doing it for hours and hours yeah and now i'm trying to and you know they gained weight because they weren't physically active and i am trying to unwind as is nat as is my ex-wife we're doing it together as a team it is so hard absolutely hard what about all these people who don't have the access to the resources that i have to try to unwind this and then what happens is i send my kids to the school and oh they may have a headache guess what they get sent home and then their brother and sister have to get sent home too until you can test and be coveted negative for a day in a row and so there's yet another day of school loss totally nuts and it's like this is supposed to be one of the best schools in the country it's not totally and then i think what is every other school like then if this is what i if this is what i know my children have to do i think we should make this we should have this as a major theme for 2022 for the pod i think it's we need to hold educators and teachers unions accountable absolutely school boards accountable all around the country to fix this this is your responsibility you need to fix it listen we held police officers responsible in the last year or two we've seen this you know policing being really like a spotlight put on it well let's put that same spotlight on teachers and administrators and schools they'll never do it they'll never do it without competition you that's the only way to politicians hold their feet you know what what i learned to build on what you said was i just decided to get a teacher and obviously i have the means to do it it's i know most people don't i certainly didn't have it growing up we could barely you know afford to exist but i think homeschooling is a viable option so with that 13k i can tell you five parents um who are in an underprivileged area can take that five times their team and take that what is that 65k and put it together and for 65k they can hire a teacher and they can do a better job with those parents and a teacher for those five kids i guarantee it so let's go to best performing asset of 2022 what do you got your mom this is simple this would be battery metals uh lithium nickel cobalt okay graphite put them in a basket like you can be along these things and rapid fire stacks what do you got best performing apps i just said series a venture because it's pretty unoriginal it's what i do i think growth got a little bit over funded and overheated and i think the seed stage also there's like so there were so many new c investors again it might have been partially because of excess liquidity so series a is still the choke point and i think it's still the best area to invest in innovation's not gonna stop there's gonna be great series a investments next year i also picked early stage startups because uh that's where the magic happens i picked early stage like right before series a i think spacking direct listings raising money people coming down to do the series b's all of that is creating a pull for more startups and the founders are getting very sophisticated in terms of finding product market fit and scaling globally you know earlier and that's what's creating these great big outcomes whether it's uber or facebook both figuring out and airbnb how to go global quickly so my choice for best performing asset of 2022 is still early stage startups freeburg what do you got obviously best performing asset in terms of a multiples basis you're never going to beat seed stage investing certainly um but uh you know i tried to highlight uh and continue my uh kind of contrarian bet that we're to see increased global conflict next year again driven by you know incumbents trying to hold on to political office and increase the inflation and fueling economic growth and the american response to china so in a world of increased global conflict i think assets that do really well are energy commodities and energy stocks i recently made a big bet on energy stocks uh defense stocks and it used to be a gold it could be the case that bitcoin uh you know sees a a role as being a defensive uh position in portfolios in a world of uh of war and conflict so though those are my kind of macro themes for for asset most anticipated trend of 2022 what he got you off a trend you're anticipating in 2022 peer-to-peer payments um the destruction of traditional rails uh it will come out of africa great sacks what do you got this is where i had the civil war between progressives and programmatic liberals so building on what jamaa said you're already seeing this in the feud between london breed and chase a boudin that is really gonna i think blossom next year we have not heard the last of that you saw it in philadelphia where the mayor michael nutter took on larry krasner i think you're gonna see it in new york city between eric adams and these manhattan elites um and you also saw it in washington d.c where the progressives were blaming mansion for you know the losing the build back better so this is a civil war it's going to continue and uh which moth predicted with aoc versus schumer would would certainly play into that so uh it's grab the popcorn it is the the trend i'm anticipating the most all right there you go uh do you anticipate a similar trend with like the alt-right trumpians and desantis and that kind of thing breaking up how do you see that playing out not not yet because um trump isn't on the ballot in 2022 so i actually think the republican party is going to be surprisingly united in 2022 i think where the trouble might come in is when we have a republican primary in 2023 and especially if trump runs then you know all hell's going to break loose so who is who are the two people who would be most viable against trump in that 2023 ron desantis and ted cruz nikki haley vicki helen that's going to be that's going to be fireworks freeberg what do you got anticipated trend my biggest uh anticipated trend for 2022 is going to be a gold rush in biotech into what i think will become the cover story on magazines throughout the year that humans have discovered the fountain of youth and this will arise from these investments in what are called yamanaka factor based cell reprogramming methods i've talked about this on the pod in the past a few years ago scientists identified that four chemicals could trigger gene expression in cells and get those cells to effectively revert to being stem cells and more recently demonstrated that using lower amounts of those chemicals and other what are called kind of epigenetic epigenetic factors can trigger partial cell reprogramming which causes cells in the body to act youthful as a result of those discoveries an absolute gold rush is now underway um more recently yuri milner jeff bezos arch and others put a billion dollars to seed a new company called alto's labs to pursue therapeutics in this area google has individually funded a company called calico led by art levinson the former founder and ceo of genentech and uh just recently uh blake byers and brian armstrong announced their new company called new limit with a hundred million dollars their own personal capital all of these companies are pursuing the same effort which is um basically causing cells to be youthful to regenerate in a youthful way and as a result you see kind of organs um and and systems in the body uh act more healthily and there will be magazine covers and you know uh 60 minutes arctic stories and all sorts of stuff will start to happen in 2022 saying oh my gosh as because the amount of money that's gone in in this year is going to cause breakthroughs and discoveries to start to get published about next year and when that starts to happen and the media and the pr cycle start to kick up you'll see this become the year of yamanaka factor based reprogramming and everyone's saying it's gonna be the biggest gold rush um in biotech since recombinant dna um was used by genentech in the uh in the 80s and 90s all right and uh i had uh most anticipated trend of 2022 being the incredible investor laws are going to change and evolve and it might just be you take a test and you're now accredited it doesn't matter if you won the lottery or you make 200 000 a year and a legal crypto framework is going to happen i think at the same time so those regulations combined are going to empower really interesting capital formation uh on a global basis whether it's running a syndicate with everybody in the world including non-accredited investors or dows or those two things merging or as biology is talking about you know a cap table over here that's mirrored on a blockchain at the same time and people being able to trade their interest in chamot's fund or sax's fund or one of my syndicates with tokens on the internet and that could become that's pretty cool a major unlock where you know if you were in i don't have a fund i run a meager family office well if you were in your earlier funds and somebody and there was still stuff trickling to social capital three the people who have that could sell it back to you or sell it to each other if they wanted to get liquidity um and that's going to be super interesting especially if it could happen just globally where some person in china decides they want to have access to u.s funds rlps could just start selling if it was structured that way most anticipated film tv series media yadda yadda for 20 20 22. what do you got yellowstone season nine uh sex so what's the first two episodes it's really great i mean you forget what a great actor um what's his name is uh kevin costner coster is a great actor yes yellowstone is great i'll be watching next season but what i had down here is thor ragnarok uh the writer director of td is back if you saw um the last thor movie ragnarok ragnarok the new one is called thor love and thunder yeah and you know thor went from being i think one of the most boring marvel characters in the first two movies to totally being one of the funniest and yeah you know most fun in his last movie so i think that sequel will be really good and then the other one is they're doing a prequel show for game of thrones called house of the dragon i'm gonna have to watch that and then the probably the the um star wars show i'm looking forward to most would be the obi-wan kenobi show with you and mcgregor so that was anakin and i had as well the obi-wan show the boba fett show and the mandalorian shows all coming back are going to be absolutely bonkers and then there's also this um token uh series that's coming out the prequel i think that amazon spending a billion dollars on and i think that's landing in 2022. uh what do you got chama it is the all in summit in may in miami and uh the the birth of all in media so i think that we by the end of 2022 we'll have um published content written content not necessarily by us well but uh other forms of uh media interaction that get the truth out to a large swath of humanity is this moving is this moving beyond just a couple of besties doing a podcast during lockdown what what all right wait so all in media is that a new acronym all in media what are we doing should we buy like a cable channel and just go 24 hours the name is the truth media a media okay there you go i didn't even know this is news to the rest of us but is uh building on the media broke okay here we go who are we gonna hire tucker um there'll be no shortage of folks who will want to come out of the woodwork to work with us on this and i think the goal should just be to make sure we figure out what the real north star is so that we never deviate and part of the biggest things that that we did guys was not trying to hustle for some few you know shekels here or there which was like jkl wanted to yeah what are they talking about we're going to work out we're going to talk in a minute about the plan for the summit the purity of not wrapping this thing with crappy ads and all kinds of nonsense is we've never lost our way we don't need some stupid deal for some crappy media company we all have independent ways in which we can monetize our lives and our hard work and so we should come to this to always tell the truth i think that that's a one of the i will say one of the great innovations that and decisions that you championed was not putting ads on it i hear it all the time for people i mean we're saving you from yourself jacob it's an interesting idea where you use advertising basis that's not driven by advertising dollars and not driven by greater by trying to maximize page views and clicks and visits um then it completely changes the equation of what's possible i think this was part of the idea of what publicly funded media was supposed to be but it obviously got you know maybe a little bit too far afield yeah it was it's just two yeah just two well then they started adding ads i don't know if you remember that they lost some funding and they're like okay we're gonna go for sponsorships they're not ads or sponsorships so you're saying we're the new pbs no it's something different we do this without any expectation of financial reward we do it because we enjoy it and so what's up for you jkl you've been no i mean i have other things that make money thank you very much i didn't know we were doing this category who what bbc show that nobody watches are you going to recommend does it matter i mean come on what show from finland with subtitles uh i don't know you know i spent a lot of time watching um like esoteric videos and stuff i find on youtube i really think it's so interesting it's such a different way of consuming media just tell us what video game you're playing anderson is putting out a porno all right what video game are you playing i called uh i called freeberg on the phone to talk about the ledge when he was going crazy on the group chat he's like i can't talk him on a video game what video games i was actually playing a video game by annapurna interactive which is larry ellison's daughter's media production company and apparently i didn't know this they had a video game arm and the video games are and the game i was playing was called maquette and um you kind of you kind of have this like interesting movie like poetic experience as you play the game so it's not really just designed to be action-packed and i don't know i thought it was a very interesting new way of um entertaining oneself okay we can move on it was highly stimulating she made a simulation of a biology lab and uh you actually get different beaker sizes and you have different sub proteins like you start you get to buy all of these lab equipment you want but it means it's actually easy it's kind of like a simulation it's like the same speed you must first mine it and the way that you mine is by solving mathematical equations i made a cruelty-free fish device dish in my laboratory because of the genocide of fish that was a little controversial take last week i got dms from people that was a spicy take freebird did you get any blow back from that spicy take last week the spiciest of the fruit i'm actually going to respond to everyone that sent me a note directly was it really because i people are like you're well well here's the thing the comment i made that i think really triggered people was i said that animal agriculture is worse than human slavery and maybe i'll just address it now real quick yeah you know i think the the point of view that people took away from that was that i diminished you know the pain and the the resonance uh in today's kind of socio-economic context of uh human slavery particularly recently in america um and that wasn't my intention at all clearly not your intention yeah what i'm trying to highlight is you know first of all human slavery has been around as long as humans have been around right for ten thousand years back to ancient egypt the enslavement of humans the the removal of opportunity and freedom granted to every living being um is is certainly manifest in the form of human slavery and we kind of take it as a very acute pain point what i was highlighting is every year over a hundred billion land-based animals are killed and they're born and put in chains and put in jails and then murdered and eaten by humans as routine and we don't like lift our head up and recognize just how serious and how skilled this this um you know this behavior is uh the industrialization of this process uh is really abhorrent and there's videos you can watch and i think when you watch them you'll recognize not delicious yeah i knew it was coming yeah don't do it and i know but i i do think that you know chama's voice in this is is really the voice that kept us from ever becoming an issue because it's not human we don't kind of pay attention to it yeah and i'm just trying to highlight that there is something that is at such an extraordinary scale that we don't pay attention to that one day we'll wake up and we'll be like oh my god how do we miss that complete agreement with your friend if you look at all life being precious and you say the life of a cow the life of a dog the life of a human these are all lives the scale of suffering is these animals yeah these animals experiences to be honest with you these animals these animals can problem solve they can feel emotion they can recognize yeah they can they can recognize things happening to them and to their their loved ones and their family members and i think that in the context of that to cause pain and suffering on those animals and on those creatures at the scale that we do is something that's just mind-blowing to me i think not enough and i expect that one day we will wake up and be like i cannot believe we allowed our society to do that but i do think that we need to solve tomas problem which is how do you make something that's freaking delicious how do you make it cheaper hold on a second it's not a problem like my perspective is i understand where you're coming from i respect your point of view but here's my point of view which is we evolved to superior superiority in an evolutionary process that was not preordained okay and we are now in a position where we are allowed to consume things that we choose now there is also a claim that you could make that you know what a tiger or a lion should not be attacking and killing a gazelle because you know that's causing suffering to the gazelle or blah blah at the end of the day how we choose to go and consume the things that we need for sustenance is a choice that we can make and there are probably better choices we can make over time but at the end of the day i think that this was a reasonable evolution of humanity and human ingenuity and intellect and i don't feel guilty about that i don't weigh the suffering of animals the same way i weigh the suffering of human beings i don't and i would argue that when we were apes in the jungle and we didn't have the choice i would wholeheartedly agree with you but today we are a people that do have the choice what choices and it's because we have the choice to not eat meat and still survive and still be happy that we can make a better choice it tastes good like there's a part of my soul i'll just that's and i agree and that's why i think we need to solve that problem and that's why i believe it's not a problem if you made an alternative for you that tasted good and was as affordable as the alternative which is actually killing an animal you would choose it and we haven't given you that solution yet when i say we i mean call it the techno food people but there is a tremendous amount of money going into this area and we will devise artificially produced meat that will not be made by killing an animal but will be made in the lab looks and tastes identical or a piece of sushi just give us a year over you'll have a piece of sushi in three years you will have uh you will be able to go taste chicken next year it'll be very very expensive okay uh but cell-based meat will be available at a commercial scale within the next five to ten years our you know steak that's really what it's about david my commitment to you is i will do a taste test whenever you say what you call that you you pick the place the time totally i will show up and if it's better i will never eat meat again okay we're not ready we're not ready for that that's a that's a great commitment all right yeah and i i i am similar in the commitment but in the meantime it's not it's distinct but i will say friedberg if you're going to have a party and it's only vegan you need to put that on the invite because i came thinking you were going to feed jacob came to my party there was no meat he was really upset he was going around my party being like what the hell is this there's no meat in this party what am i not saying can you make me a hamburger the woman from wherever my nappa was like i've never touched meat incredible ribeye on new year on christmas eve oh my god all right everybody for the dictator himself chamoth paulie hapatio with great hair uh touch of gray never looked better and the sultan of science david friedberg and tucker carlson's destiny gop front runner david sacks super spreading kovid super spreading the truth super spreading the truth david sacks from an undisclosed bestie uh hideaway uh which we all know but we won't say i'm jake al and we'll see you in 2022 it's been a great year bye-bye we'll let your winners ride rain man [Music] we opened sources to the fans and they've just gone crazy with it [Music] it's like this like sexual tension that they just need to release [Music] your feet [Music] i'm going on [Music]








happy new year happy new year happy new year guys listen it's now it's candle season oh god look at the equanimity this look at his equanimity this candle costs 24 000 it is an extremely rare brazilian sandalwood you literally have to go into the amazon and like you know you you basically have to like i mean try to extinct trees no bro you gotta you gotta tear out like two acres of rain forest and then you find this one tree completely you know sacred uh and then you chop it down you make this thing reduce it and it lasts for a full 45 minutes how do you like that sweater karen candle carrots are going to be karen candle carrots are calling it right now the dms are coming you guys want to hear about poker last night oh did you go so i go down i take my eight hour drive down south to jamaat's house and i pull in and uh you know the security guard greets me nicely as always i walk in and i walk towards the poker room and everyone's in there with the door open like someone just got shot masks on freaking out and champ is inside the house and i wave and he's like get in here and then i go in he's like oh who is positive max the dealer tested positive and everyone's been hanging out in the poker room with no masks oh the only two people that were exposed to max we sent home yeah so everyone starts freaking out he shuts the uh shuts the poker game down chamf kicks everyone out sends everyone home and then he's like all right let's go have dinner inside you know we're not we're going to we open up all the doors we're going to kind of lysol the room tomorrow we all go in have dinner or you know chamath and i go in and have dinner with matt and the kids and then chemoth starts thinking you know what it's okay they were only exposed for a few seconds let's call phil back okay let's call shuffle back let's call keating back and then they all come back for dinner and at this point it's become like a dinner party and then a couple of glasses of wine in and then it's like you know what the room's probably safe we should go i mean the whole poker night went through the entire cycle of psychology of covid the whole pandemic it's like oh my god get everyone out lock up and then by the end of the night it was like you know what let's go in the room and just play poker and give each other coven they got to acceptance they got to accept this they went through the whole emotional cycle of the pandemic in one hour does anyone know anyone who's a serious case of macron no i mean i know dozens of people at this point and they all say it was a cold yeah dozens of people and that's just except for jake i was on was on social media giving everyone the update like oh i sneezed today oh i still test the positive he's like showing his positive tests we're concerned it's the only good test result jkl's ever had yeah exactly it's the only positive that's true [Music] [Music] elizabeth holmes has been found guilty on four counts of fraud faces 20 years in prison for each guilty account they would be i understand served concurrently most people are here speculating four to 10 years and then i think you can get 15 off for good behavior again i'm no expert on that but that's what i read uh guilty counts were two counts of wire fraud and two counts of conspiracy to commit fraud she was originally charged with a total of 11 counts of fraud uh four were guilty four were not guilty three were a split verdict the jury said they were unable to come to a unanimous anonymous verdict on three of the counts after more than 45 hours of deliberation quote from the wall street journal article juries were persuaded that ms holmes conspired to defraud investors this outcome could be significant because it means hundreds of millions of dollars of thera knows investors that there are the most investors lost could be taken into consideration during her sentencing his big numbers the jury was split however on which of the six investors who testified were defrauded the jurors convicted his homes on three counts these included a hundred million dollars from the family office of former educator ed education we know the details jake saw he was like doing it for the audience so anyway um thoughts on uh the legal uh technicalities of the case counselor sex well we've talked about this before i mean i think so at the end of the day she was convicted on the counts related to deceiving investors she was not on the accounts related to patients i think that makes sense in that her obligations to investors are very clear whereas i think that the patient related duties are i mean she had them but it's a little bit less clear so i mean look it's it's what we've always said here as a founder you can be as messianic as you want to be you can promise you know anything about your vision and what you intend into the future but what you must do is be accurate about the current state of your business you cannot lie about the deals that you've made about the current capabilities of your product and she was putting you know logos of customers she didn't have in her deck she was lying about the military being a customer so she simply exactly misrepresented where she was at that time at the at when these investors invested and that was the red line she should not have crossed and i think in that sense it's a pretty simple case i think you know the the the part of this again you know the the the piece of this that's interesting is not the case itself but really the media coverage because the media wants to portray this case as an indictment of silicon valley and the thing you keep hearing over and over again none of us were involved well it just factually yes exactly we weren't involved but like there's not a single person in silicon valley i think who put in a single shekel into this thing who actually does this as a real job tim draper well she he doesn't know put in a little bit of money as an angel and then he he didn't put a single dollar in after that i'm saying you know you didn't come to social capital or craft ventures or to sequoia or to tpb or to google to raise money for this thing none of that happened you know saks is right like the the summary of uh the wall street journal nick you can post it because i put it in the group chat basically summarized the fraud and is exactly what sack says she had fixed the logo of specifically i think it was pfizer that had not validated theranos's technology in materials she presented to investors so she's basically like pfizer said this is a go and apparently that wasn't true she gave the false impression that the devices were used by the us military that's what got all these military folks to sign on board and support it that wasn't true and then uh and then she the biggest coup was that she signed a deal with walgreens and safeway to include its devices in hundreds of stores and then many investors saw these contracts as an endorsement of the technology and growth potential but basically those folks did no diligence and bought the hype and so it was just a whole cycle of this thing that basically fell apart because the tests didn't work freeberg what are your thoughts as our life science guru what's most interesting to me is how does this get to this point if you're elizabeth holmes you're 19 years old and you start telling your story and the more grandiose the story you tell is the better the reaction you get is it becomes reinforcing and the behavior extends a little bit further and a little bit further every time she told a story about how incredible this tech was it's just one drop you take one drop it can measure everything when she simplified it and reduced it to that and it was such an incredible statement and she saw the reaction from people she's like wow that works let me repeat it it's like any good sales person they figure out what sells and then they sell it and then they repeat and what's interesting to me that you know you talk about the media but when she went out and told her story and got incredible press coverage because she was a young female doing something that was going to save lives there was this altruistic steve jobs-esque kind of combination here the media wrote a glowing review of her and then she said wow look they said something great let me go do that again and she got a bigger media piece written and a bigger media piece and the more she said the bigger she said it the more she claimed she could do the bigger the story got the more coverage she got and the whole thing became this kind of reinforcing cycle and i do think that the press coverage that she got as she was building this business which helped her raise capital helped her attract employees helped her get walgreens and safeway to the table allowed to fall it allowed her to build the business but it's exactly what created the narrative that wasn't true and so the coverage that the press gave her and we see this every day you guys all see these top 50 companies and we all know having met a lot of these companies as you go down that list this this 20 companies are total scam companies they're fraud they're not going to work they're grifters all the stuff that you guys might say about the quality of those businesses but the press reporter isn't doing diligence they're not a no you know it turns out all the diligence was done after the fact and then it's like well maybe we should go do some diligence oh wait a second because this the press coverage has now created this hyped story about who and what she is the the diligence actually pays off because you have something to take apart if she was just a nobody startup that raised 30 million dollars and they're still trying to figure out their way there would be no value in any reporter doing diligence on her and trying to figure out what was actually there it was because the story got big that it gave everyone including john kerry who an incentive he's the wall street journal reporter who broke all this an incentive to go in and take this thing apart and so i mean it's really unfortunate and it's really self-reinforcing that the press coverage that created the circumstance here ultimately also enabled them the press to take the thing apart and you know land this woman in jail and i'm not saying she did nothing wrong but i'm just saying that there's a system here and the system is set up but she manipulated the press yeah let me ask one question then i got a question for saxon champ her basic premise that one drop of blood could get you hundreds of results let me just ask you a question free break at what point would one drop of blood or so a nano tube uh be able to at our current technological you know ramp be able to give us a hundred different data points on a person every time you're generating a data point you're running what's called an assay which is a measurement of something the question is how much of a molecule are you measuring against what volume is there enough of that molecule in that volume to give you a statistically good reading and that is a function of how precisely you can measure that thing so there are there are great advances happening right now in a domain and life sciences of hardware technology called microfluidics this is the manipulation of pico leader you know very very small volumes of liquid and then being able to run chemical assays using biochemical techniques which we now have all these amazing new kind of tools like crispr and other things that would allow us to get a much more precise measurement with a much smaller volume than has ever been possible so we can manipulate small fluids we can measure them so there's nothing today that would physically say we cannot do many of the things that she claims to have been able to do but there are there's a stacking of technology assets that need to be done to make that happen in reality and each of those assets are very different so look you could do it with cholesterol right now you could do it with blood sugar right now but you couldn't do both you could theoretically you could put them into a device and do that no the reason the reason why lipids work can you do four hundred things you cannot i've actually funded three of these businesses and i've poured almost 100 million dollars of money into it and they've all failed and the reason is exactly what he said you can do cholesterol because lipids are big enough you know and so you can basically build an assay that can pick that off with a drop of blood you can do a reasonably good job with pretty large error bars on sugar but all of this other stuff where you're going to replace like a you know a cbc or these broad you know profile panels that we all get once a year to assess our health today i don't think that that's necessarily within reach it's not within technological region it's not because people aren't you know smart enough it's just that not enough of this investment is happening because then you go back to this whole idea where the funding cycle needs to see a big payoff for the capitalists to want to get involved in this thing and there really isn't you know it's not as if like quest and labcorp are printing 400 billion dollars of revenue and profits and so it's not like there's a massive economic incentive to run in and so even when you know we have tried in multiple occasions with completely different teams of incredible people every single time we have failed so there's a physics law here that's just not physically possible she made this claim uh saxophone remember and don't don't make it broad there are things there are molecules there are pathogens there are things you can absolutely detect small molecules you can you can detect with a drop of blood you know measure counting how many blood cells you have in your whole body you know using an estimate from a single droplet of blood because you know we have these machines called flow cytometry machines where we sort blood cells and then it'll tell you how many red blood cells you have and how many different kinds of white blood cells that's a big part of your annual checkup that you'll typically get you know you need a good amount of blood to get an accurate reading on how many blood cells there are using even just using lasers and and you know these sophisticated machines can you reduce that down to a droplet physically probably not right and so there's some it's not universal to say this is possible it's not possible there are elements that are absolutely possible some of which are being done today and there are some things that are going to be very hard to pull off got it and she was making these claims as early as 2003 when it was founded so we're talking about 19 years ago and we're saying here it's not going to be possible to do hundreds of these things maybe in our lifetime we're talking about decades from there we need to be some significant breakthrough sacks let me ask you a legal question i was on a podcast and i said to them why haven't the prosecutors had bill maris who is a friend of freeburgs who helped me get him on the podcast he was great thank you for that uh david um this week in startups very smart guy very smart guy and he came out publicly when he was running google ventures and he said we looked at it a couple of times he's referring to their nose but there was so much hand waving like look over here that we couldn't figure it out so we just had someone from our life science investment team go into walgreens and take the test and it wasn't that difficult for anyone to determine that things may not have been not be what they seem here now saks i was on this podcast to drop out which i think is an abc news one and i said why didn't the prosecution bring up you know gv let's assume sequoia andreessen and you know the 20 top firms in the valley uh who said no and they all said no because she wouldn't show them due diligence and i asked them why didn't the prosecutors bring up those 20 firms and compel them to testify about why they didn't invest to give the counter example and she said i don't know wouldn't that have been a much better strategy to say here are the credible people who didn't invest i'm not sure i see the relevance of that because elizabeth holmes crime was not promising something that she couldn't ultimately deliver on it's okay to fail in silicon valley one of the best things about silicon valley is that we don't punish failure her mistake wasn't making misrepresentations to the people who did invest right if and what i'm saying is if anything actually what elizabeth holmes maybe should have done was call up some of those firms and they could have said how easy it was for them to figure out that they shouldn't have invested maybe that would have been a way to kind of muddy the waters on her side so i was thinking that they would have said hey she wouldn't show us the technology and when we did our independent diligence she wouldn't let us diligence we did outside backdoor diligence it failed there were red flags all over this thing we we had talked about in our poker games way before this thing went off the rails um the fact that there were no major vc firms involved who could who had expertise in biotech who could do the diligence it was all sort of it was basically family office money of people who weren't in silicon valley you know writing big checks whether it was rupert murdoch or the devos family or what have you there were there were just red flags coming off this thing which is why silicon valley was not by and large due by it the people who were duped by it were the people that elizabeth holmes was able to sell the patina of silicon valley to and the media because the media what we've seen over and over again is they don't fact-check stories when they fit their priors the prior here is that you know what the media want to believe is that the next steve jobs was going to be a woman and so when elizabeth holmes served that up to them wearing the black turtleneck it was too good a story for them to fact check too heavily and so they ran with it in the same way in the same way that you know the ivermectin hoax that rolling stone ran with was too good a story to be fact checked because they want to believe that the maga people in oklahoma were eating horse paste i mean no there's a hundred better examples of just i mean just to be generic sacks of other startups that we all know are total nonsense and total nonsense and the report there's a he there's a fraud in biotech going on right now that hey david and i david and i saw upfront i mean it's like this stuff is crazy it's really really crazy look i mean i think the moral of the story for entrepreneurs i mean i think there's a couple of takeaways here number one you got to be really clear with the present state of your business it's okay to talk about your grand vision and what you're going to do in the future but you cannot be inaccurate in any way with respect to your current numbers and partnerships and deals and current capabilities i think number two i think when you start working with the media in this way to promote your company you're playing with fire because the media really has two kinds of stories they build up and they tear down and when they're done building you up they're gonna tear you down because that's the only story left to right so if you're gonna go court the media in that way to try and get publicity you better be really careful how you do it you better be really accurate and you better not give them cause to later regret pumping you up because they will tear you down even harder if you do that i think i think the more important danger that i just like to speak generally to for a second is to not let other people do your thinking for you the investors that came into this business came in under the assumption that this was a real business because the press had written about it and the press wrote about it because the general had joined the board and the general joined the board because his buddy george schultz said hey you should meet this lady and the whole thing ended up becoming this roundabout where no one actually did any original thinking and no one did any actual diligence stop and the whole thing ended up being this i'm sorry yeah now you're talking about actually how silicon valley works so that's [ __ ] [ __ ] yeah okay you don't think these dopes run around thinking of sequoia benchmark social capital craft invest i'm just plowing the money in of course they do they don't even think social proof they assume that we've done our jealousy you think they're doing principal diligence these like the silicon by the way this is also how the bernie madoff scandal you know um got so far ahead of itself no one actually went in and did the audits of those financials everyone assumed that because someone else has is in this thing and because someone else is involved or someone else something nice has been written about it or said about it it's worth backing and like the lack of original thinking in business and life in general i think is you know one of the biggest you know risks that each of us takes and it's why it's really important to learn how to take your for yourself i i have a deep respect for early stage investors because they have to get in and make some critical decisions some people make those decisions about the team right the psychology of the co-founders sometimes it's about the end market and sometimes it's about a deep analysis of the traction but you have to honestly let's be honest there is a valley of funding between the series a and maybe the d or the e where i really think a lot of folks just look for signaling value based on who the series investors were they're saying i'm not sure they're making black i'm not sure that those family offices were any worse or any better like maybe the devos family looked at rupert murdoch and said he's smart so i'm in yeah that's exactly what happened that's so different than all these series b and c firms that say uh benchmarks in i'm in totally it's the exact same thing totally i literally had a situation and i think i brought it up in a previous episode where i was working on a deal it wasn't like a major check for us it was you know a six-figure check and they said uh none of the other firms are asking for diligence uh why should we give it to you and i was like how much are they crazy and they were putting in more money than i was they were putting seven figures in crazy and i said because i have no idea diligence when you ask for diligence now some of these founders look at you like how dare you yeah exactly they no in this case they were insulted and they said we're not giving you diligence and they and we walked away without visiting the house yeah they're like buy it without this company that dave and i call called you know well david was calling it theron was 2.0 but this company couldn't even explain gross revenue they couldn't they didn't it was like gross revenue asterix and it's like if there's one metric on a pdl that can never have an asterisk ever the top line the top gross revenue the money that came into your right customers i get it okay but gross revenue asterisks how much money is in the right open the register count the money and so i just remember asking the simple question like um can you just take the asterisks away and just tell me this is a company the two of you were looking at together you and i have talked about many times oh really you're a theradose 2.0 sir that's what this guy is and i and i've learned a lot about delaware law i don't know if you guys have i've talked about this company yeah yeah well bro you in the text you were like i'm shorting again i'll tell you in a minute oh right um yeah you know what it is but anyway i've been getting a big um a lesson here about delaware law there's something called a section 220. have any of you ever had to file one of these by the way it worked out really well sorry go ahead do any are any of you aware of whatever oh you're sure any of you aware of what a section 220 is or heard of this before basically in a delaware corporation if you're a shareholder of any size not just like a board member with 10 or whatever if you feel there's malfeasance going on you can file this 220 in delaware and uh according to there's a great scandanarps uh article on this the the delaware courts are taking very seriously that if there's any accusation of any kind of malfeasance especially financial any shareholder even tiny can get all of the books and in detail not board minutes not top level p l like detailed financials uh and so for people who are running companies this is private companies too or this is in private companies look up section 220 of the delaware general corporate law i remember at facebook is because we had these vagaries of having to control shareholder account or stuff like that and information rights yes we actually kept the financials on a physical computer that was not connected to the internet so the people that wanted it to come to our office and then we remember them in like a windowless room without their phone or something is that i think that's that's that's how they avoided people filing 220 requests and so just something for people to be aware aware of on both sides of the table that if they're shenanigans going on a company founders think well i don't have to give any information to my shareholders that's not true and it's not true whatever you have in information rights whatever your lawyers wrote is not above section 220 in delaware so just keep that in mind i got a case like that right now going on where our founder won't give you information well it's not the founder but there's a company that just sold and they won't tell the shareholders like the terms of the deal what yeah even possible good question but it's it just reeks of a fraud i'm not going to say the name yet because i'm hoping that they're going to start acting in a more kosher way but it's the most egregious thing i've ever seen all you have to do is talk to your attorney at wilson fenwick or whatever one of the cohort of silicon you literally have the management of the company they've engaged in a sale the sale has been publicly announced we have reason to believe it's in the hundreds of millions and they won't tell anybody the terms yeah file a 220 follow 220 and you know what they're public so then the crazy thing about these 220s is it used to be that all of the information had to be private yet to sign like non-disclosures whatever and now in certain circumstances i think it's in the best interest of all shareholders the 220 information can be public and so that is just like a sniper shot to anybody who is doing any kind of shenanigans we had a company in the same situation who wouldn't tell us about a sale and then i have a call with the board because i own seven percent of the company this is years ago and i said can you explain to me what happened here and they're they're like yeah well we're doing the sale and blah blah and it turned out the bankers were taking 40 of the sale whatever and i was like okay well i'm not going to approve this and it you need my approval let's talk about how we can make this work because we have outside funding that the company's turning down to do a sale that everybody's losing their money on doesn't make any sense and um they said well we can't really do that because we've already sent the eight employees over to the new company that's buying it i was like what do you mean like we ran out of money to pay them so they all moved over to the payroll of the new company i'm like you haven't closed the transaction yet wow it was crazy like there's some weird stuff that happens to private companies yeah this stuff is always at the peak of when there's a correction right i mean this may be a good way to talk about what's going on it's a great segue but it's like that level of grift happens right before you know basically we have to re-rate valuations you know people because entrepreneurs entrepreneurs just take so much well there's just a small small percentage of them but they just take so much leeway in pushing the boundary and and sometimes it's other board members who are acting their own interests but i solved this problem really easy i called the ceo of the public company that was buying them and explained the situation he's like talk to my cfo a friend of the pod whatever and i they said how do we solve this with you i said well this is how much money i have in this is the value of your company how would you like me to be an advisor to your company for the same amount of that value in shares also you grifted so no that's great so basically you got bamboozled and so you bamboozled everybody else by the way and then they said okay we'll make you an advisor then i took the advisor shares and i wrote a letter and pledged them to my investors and my investors are now 3x their original investment and i said i'm not letting it go i'm not signing the paper until i get the 250k that my investors put in period and then they didn't now i'm up all right let's segue crazy market pullback the great write down has occurred charts from altimeter uh our friend brad gerson i assume uh show a major regression to the mean for tech stock sas index median enterprise value next 12 months expected revenue yadda yadda this includes people like adobe datadog shopify twilio workday and as you can see here on the chart which will pull up saks explain to us what's happening here well it's a major regression to the mean on value on public company valuations in both sas but also more generally the the high growth stocks have corrected more than the indices so that would imply that there might be more correction to come against the indexes i think the growth stock's already taken the bulk of the hit but what triggered it this week is you know i predicted and you guys had similar predictions on the just a few weeks ago that this would be the 2022 be the year of the correction it really began in november you had the the fed you had fed governors make some hawkish statements about the about inflation not being transitory about the need to raise rates then we had the um the fed open market committee meeting this is in i think around december 15th and they announced what they were going to do on rates and now this week the minutes of that meeting were released and it basically it said something that was completely different than what they announced to us just three weeks ago and so the market basically just seized up and went into convulsions and specifically what they said you know in in mid-december was that they were going to taper faster they were going to end q1 sorry they're end qe at the end of q1 instead of q2 and then we're gonna have quarter point rate hikes in q2 q3 q4 that was the plan for 2022 and then there was additional guidance that they were expecting three more quarter point rate hikes in 2023 and two in 2024 so that was sort of the three-year plan that was laid out then we find out from these minutes and i guess these minutes weren't leaked or anything they they published them after a like a three week revise and extend remarks type period but what we find out is there what they were talking about was having a rate hike as soon as q1 and not just ending qe but actually shedding assets which is like the opposite of qe so instead of basically going out there and creating money shrinking the balance yeah yeah shrinking their balance sheet so instead of going out and buying bonds they're going to sell their bonds which will reduce the money supply so look if that was their view three weeks ago why didn't they announce it i mean my problem with this is it makes the fed look like they don't know what they're doing because they announced something just three three and a half weeks ago that's completely at odds with the statement they just put out so either something changed in the last three weeks and there's been no data or they don't know what they're doing just so you know they they they have a little bit of a track record of this so in 2018 it looked like there was going to be inflation and powell tried to get ahead of it and he raised rates and the the market completely collapsed and they were looking i think a chinese data at the time and it looked like you know china was turning you know going crazy then china completely turned over it was a complete head fake the economy wasn't rip roaring inflation didn't exist and they basically just curtailed a lot of investment and destroyed a bunch of value so this time around i think they're very sensitive to not correcting too quickly but then the opposite thing happened which is they probably waited a little too long and now you know we're correcting too slowly too late into the cycle and we're just sort of digesting that reality and so i think that you know we're probably to be honest with you like actually like we've puked it all out for the most part in my opinion you have to remember right like the big difference between now and even 10 and frankly more importantly 20 30 40 50 years ago is how many computers are involved that trade how much passive money is involved that owns assets and how much of this stuff is sitting on the sidelines still in money market accounts and munis so if you look at those markets there is a ton trillions of dollars waiting to find a home and what we've now done and brad's charts show this is we've basically chopped the head off of all of these fast growing growth multiple the underlying companies have not changed once until it right these companies are still growing by crazy amounts like snowflake is still an incredible business unbelievable but the multiple that one was willing to pay has been has been very much re-rated as is a bunch of other so let me ask you a question if we've gone from these 50 60 70 multiples time sales and now it goes back down to 20. is that dare i say a buy signal well those trillions of dollars start moving back in because who wants to be in a money market i don't i don't know and i i can't really call these things but one a really smart person that i talked to this week you know he actually liquidated everything in october and november [Music] and you know and i i don't know we talked about this on the pod but you know i was feeling so much tension at the end of last year i actually had when i look back on q4 it was probably the most difficult quarter of my professional life and just trying to manage risk and i exited a ton of positions all my pipes you know my third party pipes i basically sold off except for one you know i generated some liquidity in other places as well and i was glad that i did that in part because i saw you know what he was doing and in part because you know jeff and elon were selling and i thought i mean this is just this is crazy to sit on the sidelines and you know be the bag holder here going into q1 i talked to the same guys and what he said to me which i think is very smart is you have to really look at the first and second derivative of the 10-year bond because when that stops moving like the 10-year bond is this beautiful barometer of the collective wisdom of every single investor in the world about what they think about long-term growth and inflation and it's a really important market you know we've talked many times look at the 10-year break even if you want to understand where inflation is going we started to talk about that seven months ago and if you look at that the rate of change so the volatility in the 10-year yield is slowing way down and if that continues to hold that means that people are really saying there's a small amount of real inflation a reasonable amount of transitory inflation and we're about to kind of wash most of it through the system with you know 100 basis points of rate hikes and if that's the case then you may see a quick pullback you know in q1 and we're back to the races again because of all this other money that's going to say i got to get back in and if you look at all these corrections in the world of computer traded algorithms and etfs and passive money and it's all the snapbacks are so fast you correct 20 and then whoop you whip it back and you go so i don't know i mean that's one view based on the past but when you have these big swings remember it's not that every issue moves perfectly in sync with every other issue so there are these call it over adjustments that happen within a cohort so within a group of companies some of them will trade down much farther than others the multiple will compress much further than others and there's certainly opportunities within as there is in any market that's moving quickly uh to find businesses that now are prices mature non-growth value businesses and they're profitable and growing and there's a bunch of those out there now and that wasn't the case a month ago i don't think a single thing in the last quarter has changed in the underlying fundamentals of the majority of businesses that are public and i actually think for the most part nothing has really materially changed for the majority of private companies all that's changed is what you're willing to pay in the future for it and the one thing that hasn't changed is what you're willing to pay in the future for the private businesses so the real question you know for saxon you know for the active investors in the private markets which i don't know what to think about is will the haircut that we've all taken in the public markets spill into the privates and it's starting it's starting but it feels to me it's not just about what's going to happen with new emerging growth companies but i mean you guys correct me if i'm wrong but there are hundreds of companies that have raised billions of dollars at valuations that if they look in the public markets now they are never actually going to achieve if they were to go public in the next three four or five years based on their projections so to your point so what are nine yeah there are 900 unicorns right now 900 and so once you get to look it's one thing to be a 200 million dollar company and sell to microsoft or whatever but when you're a billion dollar company there are very few buyers i just want to point out there's a huge disincentive for an investor or a shareholder of vc or a private equity firm to take a big write down on a company like that and so there there is always this push to what do we do next and it creates this certain certainly i can tell you i'd love your point of view but you're this really like unhealthy tension because to take a write down on 900 unicorns is gonna cause a write-down of hundreds of billions of dollars and not gonna cross all vc portfolios in aggregate because they're not going to end up going public well i'm sorry just to finish your thought because the end market is only to go public there are very few kinds of exits yeah there are no and not in the billions of dollars because you have to think one or two people yeah big tech is off the sidelines okay you know even if you look at like visa members nobody's but my point is when you have 900 companies with a billion dollars in plus they have to go public they have to go public and so correct you can't go public into a valuation framework that values you at 30 to 40 percent less of your last private mark right yeah it said as well you did have do use tomorrow so this is an important question because isn't that going to be the case that all these vc's with the 2015 2016 2017 2018 2019 vintage are gonna end up having they've all got these great marked books right now you know the books are all marked to 3x uh you know multiple on invested capital and now they're going to end up having these liquidity events that are going to come in at shockingly low valuations and there's going to be this great re write down and retrenchment i can tell you there's a couple of examples one is the athletic yesterday which had raised money at 500 million just two years ago just sold for about 500 million to the new york times and those investors basically put money in and they got their money back it's a push so i think you're going to see a lot of these questions no i agree with you yes i'm going to give you the examples and there's also your acquisition by a mid-tier comp acquirer and so there'll be plenty of those that occur so there'll be a lot of pushes i think is my prediction of those 900 unicorns and then for a lot of these sas companies so you're saying you think that a bunch of them are going to sell for under a billion dollars and the vcs because they have preference they're going to get their money correct correct i think it's going to be a lot of these pushes where i don't know what is it in blackjack david when you're playing those three hands and you get a push like and it's like okay i'm going to live to to fight another hand now which we've seen sax do a number of times and then for the sas is where sax i'm interested in your position because we saw in sas all of a sudden the private market 30 40 50 60 70 times top line and now it's gone back down to 20 30 40. so those companies now basically have three the public markets have but i don't think that the private market has happened already everybody's pausing and so for the people who raised that 50x congratulations you did the right thing if you have enough money to fill in that valuation is it a congratulations though i mean it seems like there are people say it is pretty tough position now hey you just raise money at a billion dollar valuation with 10 million of revenue you're like 20. let's say let's say yeah okay i mean like what are you gonna do what are you gonna do in your next round because you're burning 100 million a year now or 40 million or whatever it is you're burning almost all the companies i've seen in this exact situation you're talking about have that 20 million they got a billion they raised 100 million or 200 million and they're basically now saying okay we got to make this last until we can catch up to that valuation and get to 50 to 75 million so i think you would i would take that deal as a founder and as an investor because it takes out the downside and now you just have to worry about catching up to the valuation and you have four years of runway if they're not gonna they're gonna right now no no no no no no those companies do not those those companies absolutely do not have four years of runway i will bet dollars to donuts they have two years or less and most of these companies have 18 months which means they got to be raising in six to nine no correct they're changing they're changing their spend and they're changing their spend they're not firing anybody you're not hearing about layoffs at startups okay all right you're not hearing about it but maybe they're changing their forward-looking growth plans what are you seeing sex i'm telling you what i'm seeing what are you seeing i think that the trickle-down effect is inevitable but i'm not sure it's fully kicked in yet um it's going to take a few high-profile deals to land at say 50 times arr instead of 100 times ar in order for everybody to know that there's a new valuation level so if you look at the altimeter chart on set public sas multiples let's see i mean they can pull it up it basically it's the sas index that shows median median expected value to next 12 months revenue and during this sort of late 2020 early 21 period it got as high as about 15 times the historical average yeah for well for next 12 months or uh revenue the which is sort of that kind of makes sense um so so historically it's around eight right so so basically all the valuation levels doubled and now they've come down to about ten times so you could say that if it fully reverts to the mean we still got like another negative twenty percent to go i don't know if that's going to happen i mean i think there has been a greater recognition that sas businesses are some of the best businesses to own right it's they are subscriptions software businesses great gross margins they just keep compounding so maybe it will stabilize it 10 times but i think what we can say with 2020 hindsight is that the record price levels we got to in the public markets in 20 and 21 were sort of unusual and unique and probably the result of this incredibly expansionary fiscal and monetary policy that was coming out of washington now has it trickled down to the again vc markets yet i mean the way that that has to happen is that the latest stage investors the crossover investors who invest in both public markets and private markets they have to to pay they have to start paying less for the latest stage growth companies and then you know all the downstream vcs are going to start paying less as well because you know if you know the markups are lower you have to take that into account so look all of this is underway right now i mean i gave a bloomberg interview in december and um i think i went on maria barromo show around that time as well and i kind of warned that all this was coming and um yeah we were in the midst of it of a giant re-rating because we're realizing that so much of the peak values we were seeing in 2020 and 21 were the result of artificial liquidity and as what you guys predicted you know it's one of our big you know i guess my big prediction for uh business losers this year were asset classes that were highly dependent on liquidity you guys predicted crypto would be one of those clearly it's taken a massive hit um have you seen how much the crypto markets are off just in the last week so it's um so much for them being uh uncorrelated no it's because look the customer says bitcoin is going to be uncorrelated so the market the crypto markets are like a sponge for liquidity and the more liquidity there is out there the more money can flow into a more speculative asset class but look my my objection to this i mean is that if you look at the fed's actions i mean i think chamath is right that they waited way too long to react and during the crisis they overreacted i mean they pumped i mean we on a previous pod we showed the assets between under reaction and overreach yes exactly and and now they're i think they're in they're going into overreacting again i actually think they nailed it in in mid-december they nailed it by giving us business certainty around what the new raid environment was going to be and just three weeks later in the minutes to that very meeting they completely undermined the certainty or the the greater level of certainty and predict the predictability that they had provided markets they've now introduced massive uncertainty so it's just it's unbelievable it's like they're pilots and like they stalled the plane and then they're like oh let's pull back well no it's more they're kind of pulling out the manual and learning in real time yeah and it's like you need to just point the nose down a bit and add a little bit of speed so you get some lift like it really is tragic the performance of our government at every level over since covet at the last you know since 2020 i mean it's been abysmal i mean first you have the self-inflicted wound of lockdowns i mean the economy is going to take a hit no matter what because highly at-risk people would have stayed home and reduced their economic activity but instead of just protecting the at-risk people we had to lock down the entire economy we padlocked elon's factories and on and on so we basically shut down the whole economy for no reason and states like california kept it going way longer than they had to so then the government just prints like five six trillion and the fed doubles the size of its balance sheet and then now they're abruptly getting off drugs i mean look they put us on drugs and now they're going cold turkey and so i think there's actually like a much greater risk now of the economy going to recession this year because of the fed's overreaction this week i mean they had they had the goldilocks scenario down about three weeks ago and i think they're going to tank the thing now or there's a much greater risk of that best advice for founders private companies in this turmoil what's your best advice fam you're a founder you got i don't know 18 months of runway right now you're going into this you know slush and you want to know what should i do what should i do i think paul graham's advice it makes the most sense here you need to focus on being default alive um define what that is just for people yeah so you know paul graham wrote this great essay uh as part where he's the founder of y combinator and you know he has this very simple you know framework of looking at companies which is your default debt or your default alive and when you're losing money as a company and you're burning enormous amounts of cash your default debt now if you're growing fast enough default debt is a great strategy for value creation but at some point everybody around you will expect you to be default alive and what that means is that the cost of what you do are less than the revenues you bring in when the result or profits and even then that's not good enough i don't know if you guys saw but you know if you look inside of big tech i was shocked to find out that you know for example you know companies like microsoft specifically and apple you know these guys trade at huge forward multiples right for enormous profitability but companies like facebook and google for the same level of profitability you know trade almost a third less in terms of multiple so even when you're that good it's not good enough to be default alive that's how hard this game is over very long periods of time and so when you have a moment to really understand how to be default alive and you don't take it i think it's a huge disservice because we don't do enough of that kind of coaching that really inflicts that kind of discipline and expectation setting i remember i have a large climate investment it's actually the single largest investment i've ever done [Music] and so i sweat the details pretty significantly and you know i was with the team in uh uh in november december for board meeting and setting up 2022 and my whole thing was guys you have to get default alive you have to get contribution margins to be in a certain band you were we are going to target this level of free cash flow generation this year and there's no if ands or buts about it and what's great is the entire team embraced it and we're marching towards that but if they didn't and they're like no we're just going to grow at all costs again oh my god i would be freaking out right now freeberry what do you have to add to that as advice to founders who have not been through this before i built my business my climate corp uh we raised a round in november of 2007 we raised 12 and a half million dollars and then the financial crisis hit in 2008. and um i'd say two things were really important uh number one was just keep building so if you're building a great business it doesn't matter what the market perturbations are uh you know the the market will value you what they're going to value you add and if you're a good business there's going to be money available to you the second piece of advice is one that i know has been said over and over again but you know never raise an evaluation beyond you know what you're reasonably going to be able to kind of deliver returns on at some point in the future because otherwise those nasty dynamics emerge you know you could raise money at some crazy high valuation that's not always the best thing to do because then the expectation of the investors coming in at that valuation or they want to make three times that money or four times that money and it pushes you to do something unhealthy like spend more than you otherwise would stretch for a bigger outcome and put your entire company at risk so you know two things to me have always been just stay focused on building your business don't let you know kind of market conditions drive your decision-making and second define what for you is the best practice of staying focused on your business because that is a very general term what is freeberg if you're going to say the top three things of focused on your business tactically means i have a simple rubric for value creation in a business you know number one is can you make a product number two is do people want to buy your product number three is can you make a positive gross margin selling that product to those people number four is can you make a return on the marketing dollars you have to spend to generate that gross profit meaning you know can ltv exceed cac and number five is can you scale the amount of money you deploy to grow your business such that as you grow the return goes up not down if those are the five kind of things you can accomplish in that order you can build the next google and so and then the sixth thing is can you be a platform which is meaning can you transition to being a multi-product company that gets leverage out of the the user base or the technology that you've built got it and so you know if you think about revenue streams more multiple revenue streams using the same customer base or multiple products or you know whatever um and so if you can achieve those six things um in that order every step of the way every increment you can make across that spectrum drives significant value as a business ultimately what the multiple on your business will be is purely going to be a function of what else is going on in the world things that you cannot control and so if you're driving your decisions about building your business using that first rubric good for you you're going to succeed you're going to have money available to you awesome if you're driving your decisions based on what the market is telling you to do and what the market is saying is available to you and money and all that sort of stuff you know you're setting yourself up to basically be you know blowing up are you also saying to be independent of valuation yeah i i'm always of the opinion that you shouldn't raise money beyond your um into evaluation that you're not comfortable saying in different market conditions or what have you i can return multiple ways i don't think any founder has ever you know most of these founders were not around in 2000 and they were 2008 or two but even 2008 was less important in my mind because it was it was it was fast and again we had government stimulus so you know like i think 2008 was an aberrational moment i was i was in the middle you know inside of facebook and i was like what the hell is going on here the government's going to step in and you know with tarp printing a trillion dollars whatever it was it didn't affect you guys it didn't affect us at all yeah but you were the most powerful company or not at that time 2008 wow here's the thing that people don't realize with facebook google was profitable from day one too yep we we were always default alive i want every single person listening to this to understand this okay we sold poker ads for party poker in big banner ads on facebook and we made money you got the bag you got yourself independent we're profitable okay so i don't buy this argument that argument of unprofitable growth is a vestige of fund dynamics and vcs who want to raise larger and larger funds to blind their pockets with fees it's a function of what i mentioned before which is if you can think about the context of a portfolio of those bets it makes sense but if you think about your business it doesn't make sense in 2000 that didn't make sense you could not run an unprofitable growth business the money would not have been there right and the real reason is that was a a market check meaning you had people reallocating capital because risk rates were different you know you could put money at six percent in the in u.s 10-year bonds now obviously you can't do that today so maybe this cycle is just the new normal and so you know maybe you can always be default debt and be able to raise money because the incentives exist but i wonder when that stops and so i don't know google was an incredibly cash efficient business i think they raised under 50 million as a private company they never used any of it because google the first the first thing google did is they did a massive search syndication deal with aol that paid them hundreds of millions of dollars and that funded the business if you can sell ahead of your customers in terms of delivering the service or the product to them you've got the most beautiful business in the world that's the definition of bootstrapping google even though they raise venture capital effectively bootstrap the business by getting customers to pre-pay like elon getting people to prepay for cars i wrote this in my annual letter like two years ago but facebook google apple microsoft and amazon raised collectively less than 250 million dollars yeah i mean what yeah so i mean i i agree with what a a lot of what you guys have said um i mean so i agree with freeburg that recessions or downturns are actually great times to build startups because innovation doesn't stop and you know so paypal was predominantly built after the dotcom crash uh yammer was probably built after the 2008 sort of great recession so it's absolutely doable and some things actually get easier in a downturn there's like way fewer startups getting funded and so like talent gets easier to recruit so you know things loosen up in you know in terms of the company building side the only thing that really gets harder in a downturn is fundraising right this is and by the way i think it's a good practice for founders not to care what happens in the public markets than as to early stage founders right because the only time that really touches you is when you need to access the capital markets right and then you will be subject to the downstream impact on vcs of what's happening in the market so so the only thing that really gets harder is fundraising and this is where i think chamas advice comes in i i personally think that trying to achieve default alive status is too high a bar i mean it's a wonderful thing if you can do it i mean facebook did it google did it the very best companies did it but i know very few sas companies that could continue to grow if they had to be castral positive i mean at an early stage so the metric i use is bird multiple i wrote a blog about this once um it's basically just how much are you burning for every dollar of net new arr you're adding so in other words like if you're burning a million dollars you know over whatever period of time a month quarter year to add a million dollars of net uar that's actually pretty good so a bundle of like one or less is amazing i'd say even up to two is good so in other words like if a sas company can say add 10 million of net new arr in a year and burn 20. i think vcs will fund that all day long even in a recession two year payback yes but when you start getting to burn multiples of three four five six and up that's when like vc's are going to go wait a second yeah you're that gross that's efficient right you're not efficient it's not just efficient but it starts to raise questions about your product market fit because you're effectively spending too much money to grow so like why is a growth that hard right no market yeah no market yeah exactly no marketable i think it's a good way of putting it so i do think you have to start like in a downturn or in choppy waters you have to sharpen the pencil get more efficient about your burn look at your burn multiple and then i think you know if you have the opportunity to top off your war chest like that's smart you know and don't wait too long and be frugal i mean god the amount of like crazy spending i'm seeing in some startups and unnecessary spending if you're spending something it's not going into product it's not going into marketing you know it's not going into sales and it's not you know just you really have to ask yourself why am i spending money on going to this conference going to that conference on this office space like really be frugal i know that it's when you have all this money sloshing around you're looking for things to spend it on but stay focused yeah i mean yeah don't don't spend 7 500 on that unless you've got tons of cash laying around and we will be getting back to the people who applied we're going to go through and somebody's going to approve you let's add one other thing to this which is you're right that like most founders have never even seen a downturn because the last big one was a great recession of 2008 2009. so many founders were even around back then the most the most the real one was 2 000. that's right that was the big crash it froze i would say it froze to that 2008 was what like 12 to 18 months of choppiness and i would say a lot of companies couldn't raise money had to do down rounds had to do multiple liquidation preferences it was gnarly on some cap tables during that period and if you don't know what multiple liquidation preferences are ask your attorney i understand but there was no real market check the market check was really in 2000. and you saw it was a multi-year slog it was a bloodbath you had to be deep well it's not vaporized yes people or you had to be default alive absolutely absolutely yeah but i would say a third of the startups went away in 2008. i don't think we're running into that again so you know let's not create a sequoia graveyard but you could nobody knows just a point look it's a pr it's a probability of getting your business funded right and and that's kind of lower it's it's not like but here's the thing what i but what's shocking to me it's like i don't understand why people think you can grow infinitely forever it's just not true even the best businesses in the world after 15 or 20 years are barely growing at 20 percent people forecast facebook and google those are the two best businesses in the world but isn't the question what kind of growth vcs are willing to finance no what i'm saying is if you know that your terminal growth rate if you are one of the best companies ever created ever is 20 in 20 years it doesn't take a genius to do a line of best fit between now where you're at 100 and 20 and realize that at some point if you don't figure out how to make money by selling what you're selling there's a lot of people who will be smart enough after enough historical data has come through the transom or come over the past to realize that these things are not that fundable and this is what's shocking to me it's like that data is hiding in plain sight for anybody to look at it doesn't make sense unless you believe that those those growth rates of 40 50 60 are sustainable for 30 years or 40 years we've seen zero examples and you have to look at these canaries in the coal mine because if if the best companies in the world can't do it you're you have to really scratch your head here or ignore it whatever that's fine just wing it yeah it'll work out don't worry about it don't worry about it don't worry just add like teachers around it's fine one of those features will work and save the day there's some magical future though did you see andreessen announced that they raised nine billion dollars or something today across the united states congratulations they're building a colossus yeah i mean silicon valley in terms of capital is um you know seeing kind of power returns itself right there's going to be a few firms that are going to you know control eighty percent of the and reason should go public and drinking tiger global you know whatever happens i don't know if something is i mean there's if you look at the aggregate capital that's being deployed into private markets right now in in probably two years eighty percent of it's going to come from three firms or four firms the problem is if you're running that much money you're insane to not take your gp public because it's the only way like you're not really generating carry at that point because you're generating a market beta return so you'll do okay but when you're sitting on 20 30 40 billion of imputed wealth by being the owner of the gp of tiger or andreessen you'd be insane to not go public i think the odds are going to be pretty high that andreessen will go public right i mean they're certainly setting themselves up to be a lot more than just a capital allocation though right it's never happened well no but i mean like venture's never scaled up to the point that private equity has until now and now that they have it's very likely it's very likely that you'll see andreessen be the first i don't know them you know very well but sacks you were gonna say something yeah well i think it's a super interesting point because if you talk to the previous generation of vcs what they will tell you is who retired right is when you ask them well did you get anything for your partnership share in the firm not just in a fund but in the firm they'll tell you no they basically just gave it away to the next generation of partners even though they they built the firm and it's because historically the belief on the part of vcs was that there was there was no value to vc firms other than just their interest in each particular fund but you're right like if they do achieve a much greater level of scale and they can go public then there is actually value in the firm itself and if you look at the terminal valuation of blackstone as indexed to aum you know uh once you pass a couple hundred billion of aum you can trade point two towards 0.1.2 times and so you know if you have 50 billion of aum there's 10 billion dollar market cap there and if you you know if you're calling jason or andreessen or horowitz i mean that's five billion dollars that just appeared out of nowhere why would you not do it right right it's a little bit like goldman sachs they always said that we're a partnership we're never going to ipo because and then they did and then they did and the and same thing did caa do it too no i guess there are no what happened with cna was ovitz uh sold this position to go to disney so there wouldn't be a conflict but he could have kept it and the like residuals they were getting from projects they packaged were incredible didn't the aria emanuel one it did endeavor did endeavor how are they trading i haven't even looked at endeavor i'm not sure but let me tell you like it's actually but think about if you're not like the current like partner owners of the firm but you're like on a partnership track there and you're working your way up to partner like by time you get to partner it's gonna be a very different economic equation because instead of getting your one over n share of the pie when you eventually become partner with n being the number of partners or some version of that now the company is owned by the public and the public or the board of directors is determining your salary and maybe you get a salary and bonus and some you know essentially options or equity participation but you're not going to be a true owner anymore because you the firm is going to be owned by the public wait a second what if we take each of our businesses put them together and then take them public as all in capital and then we get the best i'm good i'm good i'm good we got the startup studio on a conference so i don't know we can't agree on the decor and food for our one day event in miami that's because the amount of work you guys want to do is slagging me in a slat in a chat no what we want is someone to do the work we want to hire a professional i have been doing conferences for 25 years stop starting my no and you know what's going on for tuning it you know what's gonna happen you launched yammer at my conference and i put the fix in for you to win thank you tech crunch was a beautiful conference but for all in summit is it just the case we want people to show up and there's gonna be a stage and people talking on stage in this whole conference or we want to create a more magical experience a davos or a sun valley or something like we're in an agreement all right everybody thanks for tuning in to episode 62 of the all-in podcast we'll see at the all-in summit and if you want to do us a favor please go ahead and subscribe and rate us on apple we could really use that uh and uh thanks to spotify for including uh daniel shout out to thanks dad he included us in their video so now if you're on spotify and you're listening to the pod you can click a button as of this week and watch the video or you can watch the video on youtube yeah it was nice he emailed us and uh his team and then i cc'ed him on the email he's the best yes i think would he be good for uh what do you think about having him and mr beast he's super super super here's my idea for a trio him mr beast and then one other person to do a media trio future of media what is your what is your own what is your idea you don't even know the third person i mean well i'm putting it out there asking for a suggestion for their relationship you just throw this [ __ ] this is our conference in presario oh my gosh well those are two great guests on the stage at the same time let's figure out who besides j kell's gonna produce the conference david it said we open sacks it to the fans and they've just gone crazy [Music] it's like this like sexual tension that they just need to release your feet oh [Music]








look at free bird he's like this is so awkward I can't wait he's got he literally brought popcorn didn't he was watching the shower you brought popcorn he's like I want to see round three I have nothing to say today I'm just gonna sit here and watch I brought popcorn I got my uh chili roasted pistachio nuts I'm gonna sit back and enjoy the J Cal sacks [Music] Rain Man David's house we open source and source of fans and they've just gone crazy [Music] are we really going to do this as the top story I mean this is the third time we've tried to do this story do we give the background sax or no we wouldn't have had to do it over and over again if you didn't act so hysterical there we go first one you killed no you killed it no the first one yeah because it wasn't even on the docket and it wasn't it wasn't even newsworthy okay and the second one I killed because you came across like a stark raving lunatic I spiked it the second time because I was so infuriated by your Cavalier attitude towards it what do you worry about my attitude for why don't you just focus on making your own good points here's the thing I was so correct I was so correct the two of you let him go let him go you guys hear this idiot try to blame his own hysteria on me you said that January 6 was overblown and of course no I said it was a disgrace I said it was an embarrassment it was an embarrassment to the country I said it was wrong but you want to inflate it you're you're engaging in in classic Washington threat inflation nope yeah and um and there's two problems with that one is you're going to take your eye off the ball of the real issues facing the country like inflation the economy and economic anxiety like covid like crime like schools I mean these are the issues that Americans care about not you know a riot that happened over a year ago and if you and the Democrats keep talking about this and focus on it on MSNBC to the exclusion of the issues that really matter uh I'll see you in November because you're going to get slaughtered in this midterm election it's going to be a landslide but the other problem with it is with this threat inflation is that it justifies the expansion of surveillance powers and prosecutorial Powers by the justice department by the you know by the by the just Department other branches of our government who want to basically go after you know this the so-called domestic terrorism that will lead to an infringement on civil liberties just like the expansion of those agencies did after 9 11. and so I think we should all be like concerned about it now look are these Oath Keepers a bunch of idiots yeah there were 11 Oath Keepers of that rally you're saying an old fat guy with an eye patch that says both keeper lifetime member is not credible to you exactly I mean look this is these guys are they're they're not unlike the antifa right you know uh people in Portland who are trying to burn down buildings or or chase a boudin's parents who are domestic terrorists I mean yeah this is a small number of Knuckleheads who broke into the capital they should be prosecuted they're they're guilty of of saying this leader is saying in temperate things but was this going to be a coup to take over the capital I don't I don't think so okay if you want to focus on that to the exclusion of the real issues facing the country like I said this Landslide November this Red Wave is going to be even bigger just to your point about my focus uh every week here on the number one Tech podcast in the world and on the number six Tech podcast in the world this week in startups I focus on all of those issues but let's read uh because we can chew gum and walk at the same time let's read what happened on Thursday the FBI arrested 11 members of The Oath Keepers on sedition charges and the house committee subpoenaed Facebook Google Reddit and Twitter after insufficient responses to the January 6 riots or Insurrection whichever term you prefer the leader uh of The Oath Keepers which is an organization that claims over 30 000 members primarily in the military and police okay well hold on a second if this was their big moment to Stage a coup and take over the government why we're only 11 of the 30 000 there the 11 were indicted David uh there were how many were there well we don't know yet but uh last week you said uh last week you said there was no coordinated attack and now we have proof that's not what I said look you can't veto the segment from last week and then try to claim that I said sir well let me just can I get through this story or are you gonna keep interrupting my God okay you're complaining about Interruption okay that's another interesting finish it without before interruption or would you like to just keep monologuing what are you reading why don't you just give us a little remember every week that's what I'm trying to do but you keep interrupting so here we go while certain earthkeeper members and Affiliates inside Washington DC breached the capital grounds and buildings others remain stationed just outside the city in qrf teams these are quick response teams that had weapons and they transported Firearms into Washington DC ins and these in-support operations were aimed at using Force to stop the law full transfer of Presidential Power according to our department of justice which is a majority Republican obviously law enforcement excuse no Republican yes it is my God can I just read two sentences Dave gotta take zero medicine pal okay fine signal is an encrypted chat app that's not supposed to have any back doors but obviously there are some plant here are some of Rhodes's comments we aren't getting through this without a civil war too late for that prepare your mind-body and spirit it will be bloody and desperate fight we're going to have to fight this cannot be avoided if we want to make the January 6th stuff relevant first of all let me just say I see that primarily as a media story what happened happened obviously it was a disgrace and embarrassment a black eye for the country I'm not supporting or defending anyone I think tend to think these Oath Keepers it was not like a super organized concerted effort to take over the government it it's somewhere it's basically a bunch of loud mouths who you know engaged in a riot maybe there was more planning and preparation fine the court case will bear it out and if they can prove that it was what you said it was great let them go to jail I have no desire to defend them but I also think that in the grand scheme of things this whole thing's been blown completely out proportion if you watch MSNBC it's all January 6 all the time and you know if Democrats are going to focus on this issue for the next 10 months and you know who Roger Stone was photographed on a sidewalk with which was the big story the other day this red wave in November is going to be an even bigger wave I'm just telling you right now because it's not what the average voter in the country cares about I think you're right about that I think you wrote about it I'll agree with that I think you know MSNBC is focused on this and fox is focused on fake voter fraud and we've been pretty clear here that none of us agree with either of the extremes of media coverage I do think this is an issue worth wait where's the fake voter fraud are you talking about the guy who who's obsessed right now with voter fraud is Biden he just gave a speech a very intemperate speech saying that if you don't support his new Voting Rights Acts that you're on the side of Bull Connor and Jefferson Davis there were some political calculus there he had to do that because he was also trying to basically bolster the ability to get this you know filibuster thing passed in the Senate so he he basically had to play a relatively weak hand and and you know again on what happened again legislatively is that his own party said no enough in this case it was Christian Cinema who basically said no no Mansion won't support him ending the filibuster so this thing was DOA we we said it was DOA when the bill back better Bill collapsed we said they were going to try and pivot to voting rights to change the subject even though it was DOA but there is something that Biden could do or could have done uh that I think would be a bipartisan reform which is to reform the Electoral count act I mean what happened in November if you're concerned about Trump and you know this version of the potential to subvert the election and the way he tried to influence Pence to stop the county of the electors if you're concerned about all of that there is a fix for that which is the electoral count Act of 1887. it's completely Antiquated obviously it's been around for over 100 years there is bipartisan support for fixing that the Wall Street Journal editorial page has come out from what that is to the audience well it's just a it's just a it's a law that that governs how these electors in the Electoral College get counted up and certified so that you know the election gets certified so David Brooks had that piece that jamas shared in the New York Times which is the problem we have right now is not in the actual voting it's in the if you're worried about what happened in this past November it's in the certification not the voting and you know what Brooks was writing about is there's a lot of social science saying that you know a lot of these rules that Democrats and Republicans are really focused on around the convenience of the election don't really influence the number of people who vote people who vote want people who want to vote vote people who don't don't you know we're getting hung up on the wrong thing which is you know these voter ID laws what really matters is the certification of the Electoral College and you could Biden could find I think there's a number of Republicans who would support a clarification of that law and updating a bit so that what potentially could have happened in you know in January if Pence had gone along with this plan to basically reject the accounting of the electors I mean everyone understood what they think that's just ceremonial right what do you think of that plan what did you think of Trump's plan I think that Trump had a right to air his grievances in court but once the court threw out his claims and rejected them and once the Supreme Court denied sociality it was over it was over the Supreme Court has the final word in our democracy about legal matters and so no Pence never had the Authority or the ability under the Electoral count act to reject the county of the electors that whole process is ceremonial but but the mere fact this isn't even even an issue suggests that we should fix it we should go back and fix the Electoral count Act of 1887. so and look you could Biden could have gotten 60 votes for that you know I think that was very you can get he can get votes for that he can also get votes to um stop uh the insider trading of members of uh Congress he could get that done too so why isn't he focused why isn't he focused on things where he can actually get a bipartisan majority he has one big legislative success as president has been the infrastructure Bill where he got a bunch of Republican support which is a pretty big win yeah those are the types of issues he should be focused on and instead he's giving these you know speeches uh saying that anyone who disagrees with the progressive agenda on voting rights is basically did you guys George Wallace or Bull Connor did you guys hear his speech the other day on CNBC about covid I mean he was so incoherent it was kind of scary it feels like he's in cognitive the cognitive decline is you know I voted for the guy anything to get Trump out of office I thought that was an existential risk but man he is cognitively declining quickly I mean I think the craziest thing about covert was this Rachel wolensky interview I mean like why does it take two years into a pandemic to tell us what we kind of anecdotally knew but if we had known up front or sooner we would have completely Rachel wolenski does an interview she's the head of the CDC and she said well it turns out that 75 percent of all the deaths uh because of covid were people that suffered from at least four full morbidities at least four not something yeah it wasn't all it was I think it was a subset defined by it might have been like vaccinated deaths or something like that it was it was one study but yes that was basically the conclusion absolutely is significant comorbidities among people who died and so if we if we had known that don't you think I mean Friedberg you you tell me but wouldn't we have just changed our response to just mask and just kind of like start living our normal lives and people with four comorbidities or people at a certain age immunocompromise should have stayed home and we would be in a very different situation so you know I mean I understand Jason that Biden didn't the last few speeches have been a little tight you know I mean I think look the the quinnipac call poll then Nick you can post I mean look his ratings are just plummeting plummeting I mean it's down to Trump levels right every week and so he is definitely searching for a handful of wins I don't think he's strategically found found the right ones he could have done something on certifying the Electoral cartilage he could certainly do something right now on insider trading laws for uh members of Congress but instead we're focusing on all these random things but anyway sorry he can't get the entire trading thing past Pelosi but but but but yeah I think it is something that would get a huge bipartisan majority look she's going to lose anyway so he might as well just throw under the bus you're right this is about his political salvation over hers by the way you guys saw this I mentioned this in the group chat someone floated the trial balloon of dumping Kamala Harris and replacing her with Liz Cheney this is how bad things have gotten for the Democrats they floated a trial balloon of of Biden Cheney in 24. crossover ticket I we talked about this on the uh uh for a couple years in private in poker I thought I think a crossover ticket is what the country needs to kind of get back to Center and I know it's a crazy concept and it's a one percent chance but I I kind of like the crossover but things have gotten so bad for the Democrats now that but I I sort of said Saks floated this um or pre-floated it we had a little debate on the Twitter but I don't know if you remember two or three episodes ago Sax said Hey listen there's gonna be a new appreciation for Clinton and not 10 days later the Wall Street Journal and a bunch of people are floating Hillary coming back to run um Bill Clinton I didn't mention Hillary I know that but I think either you are in your Star Chamber and doing a pre-float on all in so then the backups and the can then you know pump Hillary as that or it just people are listening to you and you're that influential what I'm what I'm proposing is a Biden engage in clintonian by which I mean Bill clintonian uh triangulation which is he does not have the votes in Congress to enact a progressive agenda he should be looking for bipartisan wins he did with the infrastructure Bill he could do with this entire trading thing he could do it on the Electoral count act these are things that would be you know progress yeah China policy and importantly momentum momentum going into 20 2024 and maybe good for Americans like I mean his China policy the fact that he came out with a statement on the uyghurs I thought was very strong you know it's one of the stronger things he did but it's not coming up in the polls and I think the whole Republicans interested nobody cares about what's happening to the weakers okay you you bring it up because you really care and I think the rest of us don't care Gary hard you're saying you virtually don't care I'm telling you a very hard Ugly Truth okay of all the things that I care about yes it is below my line okay of all the things that I care about it is below my line disappointing well we I think people if you if you explain to them what's happening to the uyghurs in China they care but it's not top of mind for them that's not what's carrying mine right now is they go to the grocery store and the shelves are empty sure that I care about yeah I I care about the fact that our economy could turn on a dime if China invades Taiwan I care about that I care about climate change you know I care about a bunch of I care about America's crippling and you know decrepit in healthcare infrastructure but if you're asking me that do I care about a segment of a class of people in another country not until we can take care of ourselves will I prioritize them over us and I think a lot of people believe that and I'm sorry if that's a hard truth to hear but every time I I say that I care about the uyghurs I'm really just lying if I don't really care and so I'd rather not lie to you and tell you the truth it's not a priority for me and my response to that is I think it's a sad State of Affairs when human rights as a concept globally you know Falls beneath you know tactical and strategic issues that we have to have we need that's another luxury believe that's another luxury belief I don't believe believing in the the human Declaration of Human Rights that Eleanor patience I don't think it's a luxury belief to believe that all humans should have a basic set of Human Rights I think it's a luxury belief and the reason I think it's a luxury belief is we don't do enough domestically to actually Express that view in real tangible ways so until we actually clean up our own house the idea that we step outside of our borders with you know with with us sort of like morally virtue signaling about somebody else's human rights track record is deplorable look at the number of black and brown men that are far from deplorable look at the number of black and brown men that are incarcerated for for absolutely ridiculous crimes I don't know if you saw this past week but there was a person that was released from jail because he couldn't even be protected in jail because in some of these cells they run these fight clubs inside of Rikers Island that are basically tacitly endorsed by the Corrections Officers that don't do anything and the difference so hold on Jason so if you want to talk about the human rights of people I think we have a responsibility to take care of our own backyard first first and then we can go and basically morally tell other people how they should be running their own countries the difference is shamof saying what you just said in China or Saudi Arabia would put you in jail and get you a hundred lashes and you would be tortured for a decade we here in the United States are far from perfect we still have the death penalty which is against the United Declaration of Human Rights which we signed which Eleanor Roosevelt created in the U.N and we propagated As Americans around the world we started that chimoff and we can have these discussions about being better in this country and the what about ISM that you're proposing is so um disproportional to the equivalent of the Holocaust going on we're talking about a million uyghurs and concentration camps right now to talk about what we have here that we need to fix and compare it to that or to Saudi Arabia whipping bloggers and throwing gay people off roofs for being gay these two things are not morally comparable they are very far and we need to have open discussions and talk about human rights all the time because if we do not talk about it all the time then your position which is I don't have time for that I want to solve my problems then gives the green light to dictators everywhere that nobody's watching these things have vigilance and that that's what I find and I think hold on a second that position that's not what I said and that's not true you said you can't get up for it yeah so tell me a problem are you are you saying that the the situation with the uyghurs uh is the same as the Holocaust people who are Jewish are making that comparison you never know I'm asking you I think it is there are upwards of a million people in a concentration camp right now this is getting to numbers that are actually comparable it is actually a valid comparison you're saying there are a million people in a concentration camp that is the numbers that human rights organizations are saying between 300 000 and a million people are incarcerated right now being tortured raped and in doing for sterilization re-education and when they're released are being tracked in ghettos and so are you doing this up hold on you're saying the entire world has basically decided that that doesn't matter you just said you can't get up for it I'm talking about you specifically but who is getting up well who is getting up for it I am very up on it I talk about it all the time every week what about the US government what are they doing about it the Biden just said we are going to do a ban and we are going to uh sanction companies that do business in that region so apple and and uh Tesla I think there will be increased pressure on all companies that are engaging in China it's Goods that are sourced from those areas right correct yes it's it's if your supply chain comes from that area like we won't we won't buy Nazi Goods but we'll sell our iPhones into Nazi well if you want to have a discussion about this you know it's how do we disengage from China we've had this discussion here how can what amount of time will it take to disengage from countries that have brutal dictatorships that are committing human rights attracts again might look look I I think I'm spending a lot of time and money actually trying to fortify America's supply chain you guys know about some of the things that I'm doing absolutely I'm not doing that from a moral perspective I'm doing that from a practical capitalist perspective I think the jobs are better served for Americans and I think that we should have the ability to build our own businesses just like China has the right to do for themselves without the risk of these things being undercut by policies that we don't understand which is effectively what you do when you Outsource your supply chain to countries where you're not 100 aligned with them yeah and they're dictatorships so again I'm not I I I'm not even sure that that China is a dictatorship the way that you want to call it that again I think a country that's in the name look you have to understand Jason there are a set of checks and balances here on China that you know at the end of the day I don't think that I have the moral absolutism to judge China and I would say that when NATO is silent the United Nations is silent all of Western Europe is silent and America is effectively silent that this issue may be small data points being extrapolated in a way to create a narrative that maybe not be true and if it is true Jason there is a responsibility for those body politics to do something because that is the early warning signal that the rest of the world uses to say okay hold on let me re-prioritize my list of things so I guess what I'm saying is I am not going to be an armchair journalist on this topic nor am I going to be the armchair human rights advocate for the world because I just don't know I can focus on the things that I know about build the things that I know about and if something really does get red light status then other parties will do something and again I just want to be clear NATO is silent United Nations is silent America is silent a press release doesn't change the actual technical posture on these topics okay if that if your position is that human rights matters to you if Government large government organizations or politicians uh give you the green light to care about it that's fine I care about it intrinsically every day great I'm fine with you doing that I thought there was a segue there to talk about the ray dalio thing that Freeburg cares about I mean this is I mean this debate that you're having between kind of realism and idealism and foreign policy is sort of what dalio tackles right Freiburg look I mean it sounds to me like there's um let's just say a red herring there always needs to be as chamat points out a narrative on framing our enemy when you know you're running out of land I mean you guys saw this uh was it a journal article or New York Times article that came out today that U.S intelligence revealed that Putin had actually uh put some actors into the eastern Ukraine uh to set up for a reason to have a response and therefore an excuse to invade the Ukraine so he was trying to create a bit of a fireworks show to give him an excuse we always need a narrative that we can sell to uh our uh you know our our citizens and so you know there's not going to be a lot of you know padding on the back of China right now as we've talked about there is this you know overarching multi-hundred year economic cycle you know call it geopolitical cycle that the United States and China are about to Clash on and in order for them to clash effectively we need to get the narrative right which is to paint them as the bad guy and to make things evil and look I mean you you may take your ethical framework and say that they are bad and you may be able to take other parts of your ethical framework and looking objectively call some countries that you consider good bad as well depending on what story you want to tell yourself and what story you want to be told and I think that's what's going on and we'll continue to go on for a long period of time and this this uyghur thing as chamat pointed out how do you measure on an absolute basis human rights I don't think that there's a way to do so whether it's one person getting tortured publicly in a street or a hundred thousand people being suppressed economically and not being able to to get jobs it's hard to say what is appropriate what what is not what is evil what is not at the end of the day we create narratives and that narrative allows the bigger picture to kind of play itself out and I think that's what's going on largely and I don't think we're going to hear a lot of good news about China for the next decade from any politician in the United States or anyone that wants to defend our political and economic interests globally which are certainly being challenged by China right now so I don't know that's my diatribe about the dalio look at dalio obviously does a great job of kind of simplifying and eloquently stating what's going on but I think this is one of many many manifestations of it you need only read what the UN Amnesty International Human Rights Watch The Guardian the New York Times you know this is not tough for questions why do you think you're so wound up about this and you're not wound up about what's going on in Somalia Oh no you're not wound up about what's going on in Saudi Arabia or you're not or you're not wound up about hold on hold on what's going on in eastern Ukraine hold on a second there are human rights violations all over the world I comment on them and I have commented on them for decades since I worked at amnesty National Amnesty International which is I where I started my career I've been passionate about this since the age of 18 or 19. when I worked at Amnesty International you said that you cannot grade these things right you just said like it's hard to compare these things and this is a problem like you can actually do that there are human rights violations like freedom of speech which you know is a great aspiration but we would say torture murder systematic rape and sterilization are more intense and horrific than just freedom of speech so if you look at Hong Kong when they shut down Apple news that's one level of Human Rights right people have lost their ability again you're telling stories hundreds of these are not stories these are facts Apple news was shut down you were telling a fact about a particular a particular set of experiences that are particularly harming a set of people let me give you another fact in the United States where we have a population of let's be generous and say 400 million people 2.3 million under 40 million 340 million Americans 2.3 million of whom are incarcerated absolutely in China with a population of 1.4 billion 1.7 million Chinese are incarcerated absolutely something we have to do where is human rights being violated on an absolute basis it's a very difficult conversation to use facts and figures because at the end of the day there's a lot of data that can be pointed the other way and so it all comes down to narratives and that narrative always has an objective which is what are you trying to get people to believe and what are you trying to get them to get behind and get to do yes and what are you trying to justify yes they don't have a drug problem over there because they killed all the drug dealers Mal put them up against the wall and shot them so you know they just send their fentanyl here that's fair enough but I'm just saying like look and and it's it's a very good point which is you can actually take the data and you can slice it and tell different stories around it but at the end of the day it's very hard to say there's good and there's evil that we have to go and attack and and that is what is going to never set attack I never said attack I didn't say invade China over this and I didn't say invade Saudi Arabia I think we should talk increase the temperature raise the temperature no I did not say that either if you want to know what I think should happen your political pressure on them right I think when people are involved in torture murder rape and sterilizing people that there should be economic and disengagement that occurs as a first step and that that is why when people in our circles in Venture Capital take money from somebody who murdered a journalist Muhammad bin Salim uh and be asked from Saudi Arabia we should disengage from a country like that I believe that that is what we should do and I believe okay it's like us I believe people like us who are capital allocators and are creators and who are influencers should be talking about human rights all the time and we should be familiar with the universal Declaration of Human Rights and we should read what's in it and we should aspire to hit those notes in our country and everywhere else and this me too ISM I'm sorry this you know equivalency problem that you guys keep bringing up that is a trap that is an intellectual trap because there is no equivalency from putting um detaining a million people putting hundreds of thousands of them and torturing them to what's happening in the United States where we wrote The Universal Declaration of Human Rights and where we can have conversations about it if you tried to have the conversation we are going to disagree with you we would all be tortured in Saudi Arabia we would all be tortured and detained inside of China I just think that there's a very dangerous thing that you're doing which is you are ranking and which is essentially assigning some sort of let's just call it economic value to those things that you just just described torture rape Force sterilization but I think then you're ignoring how do you actually economically rank systemic racism in the United States what happens in our inner school system inner city school system what happens to black and brown men what happens to the families of those people what happens to how the lobbies basically break down the Health Care System all I'm saying is Jason if you take your argument to the extreme you start to get into all these areas of gray where it's impossible to assign economic realities to those things so that you can actually Rank and rate that's why I do economic yeah because we're talking about these things no no I never use a numerator I'm just saying one is proportionally different sure I'm not putting economic I never determine if those really bad things happen 10 times and these kind of bad things happen ten ten thousand times which one's worse I think if you asked anybody who is in a uyghur prison being sterilized towards you know I'm asking you if they would rather be yes I mean you could actually do this test Jason I'm asking you a question if 10 people 10 uyghurs were raped or forced sterilized yes versus 10 million black men falsely incarcerated which one is worse yeah this is not the way to do the calculus you could do it on an individual basis you can look at it individual inside of a prison being tortured and an individual living in the United States every single person who is inside of that torture chamber being raped being sterilized would say I would absolutely love to come to America that's why everybody wants to come to this country and live in a free democracy where they could speak freely they can practice whatever religion they want and not be tortured and what you're doing by adding up all the tiny pain and suffering that we have here in America and then you know trying to conflate that with these horrific acts you have to look at exactly how horrific these are on an individual basis just like we did with George Floyd we see George Floyd happen that is something that is absolutely worth being outraged about at a higher level right you have to stop for a second and say oh my God this has to be resolved we can do these two things at the same time we can refine our education system now George Floyd the uyghurs being sterilized I think George Floyd's my point because there there's been innumerable number of black men that have been murdered with nearly a thing that's ever happened in the United States but it happened in an exact moment where the sum of all of these other things that happened before had just compounded to a point where the whole thing spilled over and enough people decided to basically say the sum total of this damage yeah now is the equivalent of a very meaningful human rights violence you can work on both these things at the same time is my point and this and this you're basically giving a pass by by kind of conflating these two things in my mind you can work on both these issues you could want to stop abhorrent torture and murder and rape while wanting to make our justice system better while wanting to make our education system better you don't have to pick one trim off I think you do actually no you do not we could absolutely create nothing I can do about the uyghurs in China zero absolutely there is you could not Capital allocate to Regions or to companies that are engaging I don't I don't have any Xing Chinese okay and if you do see one you could do that and you could also I can't because they can't get out of China what are you talking about do you taste in Saudi Arabia no okay did you make a moral decision about that no okay if you did get offered a billion dollars would you take it from them and by the way to be honest there's a bunch of my companies that have been supported by folks who have taken money from them and I know that's a problem when I look what well what's a bigger problem is it that the solution that these guys are that they're designing for mental health or diabetes or you know housing or whatever it is the startup does when they take money from SoftBank or whoever all of a sudden they should be canceled and not be able to do that I didn't say cancel just take the money from somebody different nobody said canceled where I don't know CO2 pick another firm Goldman I don't know who it doesn't take Saudi so should the should the United States create a program where whenever you get us you ever get a term sheet from SoftBank or anybody with money from didn't say that pif you should just be able to go and redeem it for some somebody else's money I never said that either I think each individual a capital allocator like yourself and a CEO should make what they believe is a morally right decision well they voted and they don't care about this issue they're voting with their dogs after getting that people should care about human rights and they should care about who they make money for I know I'm a lone voice I know I'm a lone voice but I believe you should care about it I'm not saying Jason I'm just saying something very subtle I'm not saying that what you believe is wrong in fact I think it's beautiful and wholeheartedly right what I'm saying is when everybody else tries to nod their head and agree with you in the moment they're just morally virtue signaling in a luxury belief that they themselves don't exhibit they don't make any changes towards and it's largely because they don't believe that this is an issue and I'm just putting it on the table as it just is true based on everybody's Behavior maybe other than you I agree with you but everybody else is voting I would like to change everybody's behavior and I think you can offer your opinion and maybe you will change some people's minds I'm sure there are some people listening here and I know there are some Founders who would not take money from SoftBank and would not take money from Saudi Arabia and I know there are some capital allocators who will not take money from dictatorships I think that you're you're also forgetting that there's there has been as as it seems again from very very far away looking in a lot of things that they have been able to do that is really constructive you know they've actually created some pretty decent ties to Israel um they've actually started to create a path to normal normalized relations in the Middle East you know they've organized against what could be the real threat there which is you know a a nuclear empowered Iran so just to put things in perspective Jason it's kind of like you have to look at the totality of the situation again in the United States today if you've just looked at that one simple thing you can cherry pick all kinds of reasons why many other companies shouldn't expect shouldn't accept American Capital because you know we don't really exactly have our [ __ ] together either proportion of these issues is I think I think what shamath is saying is the world the world is complicated I mean we had so under the the previous president they said there could never be uh like a peace in the Middle East or a deal between Israel and Arab powers and there was the Doha agreement where you had three Arab states signing pastries with Israel and Saudi Arabia allowing flights between Saudi Arabia and Israel for the first time and that's all because of MBS and there was an article on the Wall Street Journal talking about how King Solomon actually was holding MBS back on this because you know he's from part of the previous generation who was backing the Palestinians and MBS just wants to move forward and actually get a deal done with Israel and if the Palestinians won't make it then he's willing to move forward without them and this is not me saying this is a Wall Street Journal yeah we need to dig up that piece so all I'm saying look what happened with that journalist was absolutely wrong but clearly like Foreign Relations is very complicated especially in the Middle East and it's not clear that like net net Saudi Arabia probably just did the one wrong thing which is that every country engages in extrajudicial killings they just got caught right because I don't think it's fair to say but also torture they also killed a journalist I think that Americans have done that okay we've done that as well absolutely I don't think you actually have any idea the extent of what we have done during the course of these wars in all of these countries I don't think you know well I don't think I know yeah so by saying criticize Abu grape do you really know do you know of all the other the worst one of the worst things we ever did and one of the things we need to Aspire to do better around the Middle East for 20 years now in Afghanistan we supported Warlords in Afghanistan and we were allies with who were raping young boys I mean this was like a giant uh series of articles in the New York Times Iran Contra I mean we've been doing this since the 80s even more recently in Libya we we basically got rid of a Gaddafi and plunged that whole country into Civil War and it's never recovered from it so look I I actually Jason I I'm somewhere in between I actually agree with your idealism my mind's still blown that you actually work for AMC International but I just think that the world is more complicated than that and sometimes we have to make choices and and the the thing that concerns me is that that idealism that you're citing has become a Prelude and a pretext for war in the over the last 20 years and we can and to be clear I'm not advocating Globe getting into these conflicts Libya Syria Iraq you know what good has that done us yeah you know I'm anti-war you know I'm anti-war you know I'm not advocating for invading places I'm advocating that we speak up when we see Saudi Arabia take a blogger uh Rafi everybody did I mean that was universally condemned but but the question is who is it being caned for writing blog posts what's an alternative in Saudi Arabia live there we don't get to pick and choose who the leaders of these countries are does it mean that doesn't I'm talking specifically about entrepreneurs Capital allocators that doesn't mean we need to engage in business and building their chip stack if you want the sternly worded press release you just got it from Biden to hopefully it it's it peaked it it satisfies it quenches your thirst because the only other solution us talking about actually if you want to know what I want I want to see the three of you speak up for human rights that's what I would like to say I think that human rights in the United States is way more important to me than human rights anywhere else in the globe and I think that we have an abysmal track record of taking care of colored men and women in this country and I don't disagree and so I have zero patience and tolerance for white men blathering on about [ __ ] that happens outside your own backyard fix your own inside backyard humor rights here as well because you guys are the ones you do not get to diminish me for being white no I understand but I'm saying that you are uniquely in tradition of power in a way that the rest of us are not and so when you guys clean up the inside then we can go and fix the outside yeah I believe we can do both I I believe we can do the same thing at the same time we could speak about human rights here we could speak about it in Saudi Arabia we could speak about in China and we could talk about the same thing we could talk about all the human right issues from freedom of speech to murder I do I do constantly if you care so much about journalists why haven't you spoken up in favor of son and Assange the way that Glenn Greenwald has of Julian Assange Assange and Snowden read Glenn greenwald's reporting on these topics I think that we need to get to the those I in either case we don't know you've acted with complete certainty on Twitter saying that these guys are Traders and should be locked up in U.S prisons oh no no I I think we don't know hi we know who they're working for why haven't you spent the time to learn no well I mean it is a black box in that case we don't know in both of those cases what the backstory is I do think I do have a new conversation on what's going on you know about what's going on with the uyghurs because you read a New York science article the New York Times article about Snowden we have had people have we have we have people who have defected and been on 60 Minutes who were in those prisons you believe what you want to believe no you you literally can believe somebody who escaped from the prison you can believe them yes with when it comes to Julian Assange I I I don't know what to believe exactly because he released all those data dumps and he didn't do it properly like a journalist where he vetted the information which snowed in I'm more inclined to think that he was a good actor and I think it's a very nuanced position so if you want to try to paint me as like not knowing everything about every uh human rights violation in the world every nuanced position of a leaker that's correct I don't know everything about everybody but I'm going to take that position I don't know anything about any of these things which is why I choose to focus on the things that I can control and I want to believe that I want to improve my own backyard which I think is absolutely great and I think you can add an end there which is you should be talking about human rights and Hong Kong should be talking about inside okay and not my problem is the problem not my problem I believe that's part of the problem right now you said it you you said it perfectly Jamal people don't care about human rights anymore there's a larger people I agree with you who do not care about human rights the way I did I think they care about the local version of Human Rights fine yeah and I think you need to care about all of them and talk about all of them at the same time the international adventurism around human rights I don't support in the least and I do feel that a lot of this stuff is like the tip of the Spear of people who then get morally absolute and say we have to fix this and the only solution is to invade these countries and instead I would just rather them if they really care about it let them stand up and do what they need to do I think we need to fix our own backyard I mean look not to kind of bolster tomat's point but there is a blind eye turned to that which we don't want to believe or that narrative which we don't want to sell and then we point towards the narrative that we do and we see this all the time where the focal point of where should we be addressing human rights issues is where we have economic and geopolitical interests no one seems to be solving the problem in Somalia no one's getting on stage talking about the issues that people are facing in countries outside of where we have deep rooted trade Partnerships and serious economic interest and so you know like we can tell ourselves all day day long that we need to be kind of the absolutists and absolutely take care of the world because we're the the beacon for human rights but the challenge is we end up being forced to choose where we want to spend our time and our resources and our resources go to where those resources flow back to us and that's often where we have a geopolitical and economic interest now Jason I'll say one more thing like just because it's important jaycal because you called us all out I I am an absolute human rightist in the sense that I believe every human on earth should have a right to do whatever they want within their own sphere of influence provided their sphere of influence does not intersect with the sphere of influence of others end of story and I don't see that happening anywhere on Earth and this ends up being a trade-off you always end up trading off your sphere of influence for that of the greater good or someone else because power allocates and power Aggregates to specific places often to government sometimes to organize societal decisions that we say we're going to trade off our individual rights and freedoms for that of the greater Collective and it is that judgment and it is that gray area where all of these issues that we individually choose to address and spend our time on arise and so I have um you know just to point out like a very absolute point of view on this but to me the challenge is how do you make a discernment how do you make a determination that imprisonment of brown and black people in the United States versus the treatment of people by um uh militia in Somalia versus the treatment of the wiggers in China versus you know and and you go on and on and on it's a very difficult moral judgment or you could just say they're all wrong they are all wrong they are all wrong we're going to talk well see but you work on all of them you work on none of them and I would rather see Innovation enable more people to have access to more free speech to have more resources to have more of an ability to climb and have the freedom to do the things they want to do with their life I think that Innovation and Technology can bring all of these old school ways of thinking and behaving out of the Medieval ages and the Dark Ages and so that's where I choose to spend my time you know how can we unleash people's freedom we got to make things more available we got to make things more accessible I just want to make two points and then maybe we can move on on this topic Point number one is when you're an immigrant part of what you're doing is you're actually voting against the place that you leave to embrace the place that you come to and Jason you know of all the four of us on this pod You're the Only Natural Born American right you you started here you've lived your entire life here and that's an incredible blessing that you were given and the three of us weren't and you know in my case I had to go through an even more circuitous path I didn't even come to the United States first had to go through Canada but implicitly you know when I look at the places that I left and specifically you know when I look about when I look at Sri Lanka who you know has a very checkered human rights record in fact terrible in some ways and the way that they ended the war against the tamil's atrocious I have to make a decision right I have to make a decision about is this something that I'm going to wade into or not and what I've realized through my own life's journey is these are not my battles and in many ways I abdicated my responsibility to vote on that issue when I left and instead I stay here and I focus on the things that I can control here and I think that I do have a responsibility to fix the issues of the country that adopted me and so that's where some of my framework comes from separately I do want to give all three of us a shout out because I do think that there is an enormous human rights issue that I do think we did bring up and in the last few weeks has become a real Groundswell and it started on the you know year in recap pod where we talked about what's happened to our kids and I just want to call out that in the last few weeks the amount of press attention that this issue has gotten which I do think is a human rights level issue which is a cognitive impairment of our children has really come front and center and uh I think that it's really really incredible all the way to like even nature now publishing these you know and maybe the timing is just coincidental but these big longitudinal studies that really show that you know we have uh driven a level of retardation in our children we have held them back from a level of Learning and Development that we now have thrown our arms up in the air we don't know what the real long-term impact is that I think is a human rights level issue and domestically in the United States I think we're in a position to fix it if we decide to take care of it so you know again I don't mean to offend you when I say that in my prioritization list it's below the line but there are different human rights issues that I care about and I think to just to be clear you know when you said I called everybody out here I'm trying to have a productive discussion freeberg I'm not trying to put it in a spot I don't get offended I'm not I'm trying to have a predominative discourse okay but I want to make it clear that I'm not trying to call out besties here I'm trying to have a productive dialogue from Prince alawid he's like one of the largest investors in the world you know I wouldn't yeah yeah he's a Saturday of Saudi Arabia you wouldn't if the money comes from a dictatorship from an authoritarian country I would 100 he was locked up he was locked up at the Ritz and he was forced to give a bunch of his money so it doesn't mostly lived out of the country anyway I mean person oh I always tell you my my face is a citizen or a former citizen of that Country Born there Jacob yeah I agree let me just tell you I clearly I would never take money from an authoritarian regime would you take money from a Chinese billionaire no I would not take it from a Chinese no I would not take it from a Chinese if I if I no not an authoritarian regime they they the Chinese are not an authoritarian we're talking about a Chinese billionaire if the Chinese billionaire was outspoken about human I would tell you it's a great thought question and I'm just ripping here it's a great thought experiment if a chinese billionaire had left China he just absolutely tortures me yeah so but no I would not I would if the person was a reformer yes I would consider it I would consider it Jason but Jason I guess what you're saying is like you and this is your decision to make my decision yes it's it's important for you that you understand what people's personal belief systems are when you take money from them no human rights is important to me well there's some saying my their personal belief system like you know you utilize care less if they were an illicit drug user right for somebody else so for example I'll give you an example so I did take money from a Chinese billionaire when I when I first started so remember but I'm not going to say who it is no no need but there was a a morality clause and there were certain things that were incredibly important to this person and they were very easy for me to reflect because they were nothing that I cared about but you know they explicitly didn't want certain kinds of investments in whether it's gambling cannabis sex porn for me yeah the list was gambling alcohol can anyway my point is you're fine signing up to those moral judgments from an investor but not necessarily you know silence on I'm asking you the question you would be fine signing up for those moral oblique for moral delineation of what you can and can't do even if it's not against what you believe but you have a different issue when it comes to silence on these other topics yeah I would here's here's how I'll answer the question I if I'm taking other people's money to invest it and they don't want to invest in the adult I don't have a problem with a cannabis as an example I don't have a problem with wagering and gambling but if I'm building a fund to invest in businesses those are that's not an important issue for me and I don't know that's a great Venture investment and I can also invest outside of it my own money so it's a more nuanced issue there like I I have invested in wagering apps that I'm thinking about creating a Syndicate specifically for gambling and wagering and yes there are LPS who I currently have in my previous fund the active fund that do not I do not invest in wagering because of that so yes and it's because they just want Clarity in some cases on not getting sued for investing in a in a in a wagering companies where we don't have a federal mandate yet so you know I think comparing it's these are great thoughts everything for me I was fine signing up for no alcohol because my father was an alcoholic and so it was it was weird and there was a certain investor who at one point tried to be an LP very well-known person who uh was convicted of domestic abuse and I didn't take that money because I was I had been the victim of domestic abuse as my as my mom yeah and so that was a moral issue for me the point I'm trying to make to Jason is that it's very nuanced everybody can be on a bunch of different sides of this thing and I tend to think the most consistent reliable thing is that these are very local beliefs that when they touch you you have a point of view on them and I and I think that you know it's much more practical and maybe this is just being too practical to see a world where people want to fix their own backyard first and the and I think a lot of why you may be disappointed that a lot of people don't have a strong review on things like China as people are a little exhausted with having moral views about things that are so far away when things in their own backyard are so broken yeah and and I can understand that exhaustion and to be clear I just I just like human rights is such an obvious and easy one to get behind for all humans and that really perspective and that's what the universal Declaration of Human Rights was about was we were hoping that all countries in the United Nations or Eleanor Roosevelt was that we could all just agree that torture was immoral and when the United States waterboarded the United States whether the death penalty is immoral so right and you know what that's something that you know is our great family we're riddled with hypocrisy the Declaration of Human Rights here is is an ideal it's a goal it's something to strive towards and each country has places where they succeed and foul and you can actually measure it and we do measure it actually we do measure which countries have the worst record on human rights violations and which ones have the best viable scores are crazy no no they're not you can literally talk look at how many women are raped in prison in one country versus they understand but my point is when you put a score to that or count it you're not counting a bunch of other things that are really bad as well the scoring system could be refined sure I will give you that and I think this is the debate we had today which was an unexpected debate and I didn't think we would go this deeper I think is such an important debate for us to have as humans and as a civilization because we are getting in the Weeds on so many other issues whether it's inflation or you know uh Innovation or politics that human rights I feel is something we should all be able to agree on that all people should be so the definition of Jake how everyone says yes the definition and the prioritization is where all the noise is yeah that's that's everything and how do we deal with violence no one on earth that's going to say I don't believe in human rights everyone agrees with the ideals the question is how you implement them implementation prioritization definition exactly like for example in the west we do I think it's I think it's a legitimate position for you to say that you're not going to take money from dictators but to then say that any family office from any individual who was born in that country you're not going to take their money either I would have to think about it I didn't say that unless they're willing to risk their lives by denouncing their own government I don't know they have to do it publicly I mean if I talk to this hypothetical Chinese or Saudi person and they said I don't agree with this I'm working against I'm a reformer I I guess I would have to consider it because I wanted to make money for the reformer but Jason what if they said I don't have a point of view that I would go with people who would you morally disqualify them you disqualify them on moral grounds that's not the way to make allies Jacob which is important you're not letting me know look look hold on I need to answer it if you're both going to ask me this question and accuse me of you know this I would have to make a nuanced decision on an individual basis I would not make a blanket decision that's my position on this hypothetical situation where somebody is a Saudi citizen has a family office I would have to make a very nuanced decision like you ditch him off where you didn't take the domestic abusers and you did take the personal that was an American but I took the Chinese okay yeah but it's the same thing it's a human rights violation it's it's a horrible thing that occurred and you had to make a nuanced decision and you know that's what I'm hoping to promote here is that we have a dialogue about human rights again because when I was growing up in the 80s this was something that the world was getting consensus on and the West had consensus on and I think the West is very weak now and the fact that the NBA that you know Apple whatever companies I don't want to call out individuals because it's not productive especially if it's aggregated and you know I happen to know some of them it's it's something that the West has to contend with of what is our strategy here with human rights violators do we engage them do we admonish them or somewhere in between do we disengage engage or you know make our feelings heard and try to shape their behavior to bend towards human rights and it's a very complicated nuanced discussion I'm glad we had it here today the time period you're talking about where we supposedly had consensus on this during the you said the 1980s during the Cold War I was talking about in America yeah okay well we talked about it a lot in America is my point yeah well I think actually I think Ronald Reagan did an earlier job with this he denounced the incredible evil empire but said that we should be a shining city on a hill and we did we actually avoided a bunch of unnecessary Foreign Wars 100 so look I think the best way for us to lead on this issue is just to be an example we're not doing a very good job of that I mean 100 of your ideals are great but the world doesn't neatly line up with those ideals and presents us with choices that don't fit those ideals I mean during the Cold War we had a choice to support either communist regimes or in a lot of cases authoritarian regimes and we chose the lesser of two evils I think today we have choices between do we want to support Islamic fundamentalists regimes or we want to support authoritarian regimes we're resisting it I mean those are the types of tough choices the world actually presents to us and I think that's what makes it hard to [Music] it's a complicated chessboard and you're better at chess than mesack so I will give you that and I think it's great that we had discussion I really do appreciate that you guys were willing to talk about this for so long it's an important discussion because if we don't stand for human rights and basic human rights what do we stand for you know and I agree that domestic is important I stand for I Stand For Me Yeah we know that we know that tell us about the sweater tell us about the sweater no candles and Jacob if you're concerned about the rise of authoritarianism which actually this was my one of my big trends in the prediction episodes I am concerned democracy which is the most negative Trend but then I think you should be concerned about this like Rising tide we have here of censorship and the surveillance yes I'm in agreement and our federal law enforcement agencies demanding more and more power lockdowns and lockdowns this whole like January 16th out of proportion you should be concerned about their attempts to exploit and use that to demand more Powers I do not believe in surveillance would I uh and I think you should understand that the hysteria created around that event is going to be used it's going to be exploited possible to demand these Powers politicians are explaining this on all sides of the aisle I agree with you the right and the left the right is diminishing it the left is exacerbating it the truth in the middle is I think we are in agreement sex the overwhelming majority of people who went to the Capitol that day were were [ __ ] who just wanted to protest and they cared about Trump and they went there for the party of it all and then there was a small cohort who intended harm and who are deranged and who could potentially be dangerous in the way shmoth framed it lone wolves or small packs of wolves like the Oklahoma City bombers who murdered a large number of people um and so we have to be very careful in Prosecuting one group one way and one the other way and that's exactly what the Department of Justice has done in that case 700 people got pled deals or very minor sentences and then these folks are going to have the book thrown at them and rightfully so because they could have murdered Pence or they could have murdered Pelosi just like that woman got murdered I'm sorry the woman tragically got stopped and shot and died like that could have been a much different day if dozens of people had died and those cops had not shown restraint we could be sitting here having a much different discussion about The Oath Keepers if the Oath Keepers had done with the Oklahoma City bombers succeeded in doing this would be a much different discussion right they didn't which is why it is a different discussion and well thank God for our police and and for How brave they were in not unloading their pistols when uh any reasonable person who was being beaten by that crowd and crushed would have taken their gun out and started firing they didn't thank God those police did not say look I think the one thing we can agree on is we don't want something like that to happen again and there's two things two simple things that would prevent it one is reform of the the Electoral count act like we talked about that's what Biden should be going for not making these speeches about Bull Connor and George Wallace he could actually get that done and the other thing is if the Capitol Police had just been a little bit more prepared and had barricades and screens of better security that also couldn't it couldn't happen again that's all we have to do to solve that problem is there anything we have to do is arrest these Oath Keepers and put them in jail for what they did well it's no they've been indicted you tell me if they're going to go to jail don't convict him or something yeah well and rightfully so it seems hopefully they get their day in court maybe we can transition I want to talk about the other side of the coin on inflation because I think that we have hammered the point for a long time now that you know the government was really slow sort of like off-pisteed by printing incompetent trillions and trillions of dollars and and injecting it into the economy and what it's really created has been uh this massive bout of inflation which then could cause an ultimate recession because the FED has to react all of those things I think are well documented I just wanted to put on the record the a little element of the counter factual which I think is really important and this is an article in the Wall Street Journal and Nick you can post this if you can please but I'm just going to read this so I'm just going to look down the first two rounds of stimulus payments lifted 11.7 million people in America out of poverty according to the Census Bureau Americans build up 2.7 trillion dollars in extra savings and some expect that combined with Rising wages to Bravo to provide them with lasting stability despite the return to more normal spending patterns and Rising inflation so I just want to make sure that all of us have heard that because that's an incredible thing to be able to say that 11.7 million Americans in poverty are no longer in poverty because of the stimulus which I think when you look at the right way of framing what some of these progressives want to do I think a lot of the Good Intentions comes from things like this and I just think it's important to acknowledge that that did happen and that's something that we should really be proud of and especially if those folks can actually stay in the lower middle and then move up to the middle class that's an incredible outcome and you know we we all supported that I think genuinely and I think that that's good we knew it was scary we needed to put something into the economy to keep it from crashing and it's very hard to know what what the right amount was right tremoth like how do you know what the right amount of stimulus is in a pandemic that happens every 100 years uh and thank god it feels like Omicron is you know leading us out of this okay yeah there's some great examples by the way in this article if you guys if people want to take the time to read it of some examples of people that have really done an incredible job in um in like completely changing their financial picture which I think well I mean a lot of comp a lot of people went into freelance a lot of these young people realized I don't know if you saw this headline a million less people uh started college this year and enrolled and I think what's happening is so many people who were going into college realized I don't know if I should go into debt I figured out a way to make money at home I'm more financially literate I'm going to make a better decision about college and not go 100K into debt well to be very expensive people very resilient and being better making better judgments about their own lives because they've been forced to to be specific I think you mean boys because the other thing that's happening is in colleges now it's becoming very tilted uh female versus male especially colleges in some colleges it's you know two-thirds female one big male so 65 we were actually creating this weird longitudinal pattern here where uh an entire gender is going to be very miseducated relative to another one and in fact it'll be the exact opposite of what it was like in probably the 50s or 60s where you had these large swaths of men that are educated women who typically stayed home or were undereducated relative to their ability here now it's the exact opposite whereas you know women are getting undergrads and graduate degrees and boys are learning how to play video games and smoke pot in cells a very strange time I mean that's what happens when you David's what is that like yeah being an incel tell us you were a Pioneer in being an incel we made it through the show so it was so civil let's get the Friedberg ratio up let's talk about an exciting scientific paper and the implications of it it's a science boy tell us about this new study from Harvard that revealed Epstein-Barr virus could be associated with Ms I'll do a zoom out then a zoom in yes so bear with me for a moment so you know there were over 80 what are called autoimmune diseases these are diseases where your body your immune system attacks your own tissue and causes real problems one in 20 people worldwide suffer from some sort of autoimmune condition so Crohn's disease lupus which affects you know your whole system rheumatoid arthritis or your joints get inflamed Sjogren's syndrome where your eyes and your mouth get get messed up and and multiple sclerosis which we'll talk about here in a second but these are all diseases that have a similar ideology which is that your immune system attacks some tissue in your body it dysfunctions and it attacks it and there's always been this big question about kind of what causes autoimmune conditions and what causes immune system dysregulation like this and there's all sorts of different theories and studies and papers many of which have been you know well well documented genetic risk factors environmental factors age and in particular as you get older the thymus which is supposed to create these helper cells that go out and keep cells in your immune system from attacking your own body your thymus kind of starts to fade away or sorry your thousand starts Fade Away start stop working and so um you know one Theory that's been talked about a lot is molecular mimicry which means that there's some protein from a virus or that enters your body or cancer and that protein looks a lot like some other protein in your body and so your immune system starts attacking that protein and as a result your immune system gets turned on to that protein and it actually attacks a similar looking protein somewhere else in your body and that's a you know a very kind of broad statement about you know some potential cause of autoimmune conditions and you can find protein mimicry theories coming from the gut uh where you know microbes in the gut are triggering this and then also viruses so in particular you know cytomegalovirus and Epstein-Barr virus which we're going to talk about here today so multiple sclerosis is this disease one of the autoimmune diseases where your immune system attacks and destroys myelin which is you know found on um your nerve cells and in your brain and it can actually cause you know when this happens and your immune system starts to attack your brain you end up with these lesions and really debilitating effects over time one in 300 people in the US have been diagnosed with MS it is a brutal disease it it lasts your whole life and the treatment today the primary treatment is this drug that destroys B cells in your body and your B cells make antibodies and so by destroying the B cells it gets rid of the cells that are making the antibodies that are attacking your own brain and uh and this is a really effective treatment it's been able to reduce the effects of Ms significantly but we still don't know what causes it and what triggers Ms and there's always been this Theory going back to the the mimicry question that one of these viruses that everyone seems to get as they you know age is causing it um and so Epstein-Barr virus has always been thought to be one of those viruses it's one of the herpes viruses uh everyone knows it as mono so you know you get mono and you get swollen neck a lot of people do most people that get this virus don't end up having any symptoms they don't even know they have it and here's a crazy statistic 95 percent of people have Epstein-Barr virus and it's known that Epstein-Barr virus does actually cause some kinds of cancers and when lymphoma and so on so here's the paper that was published yesterday and again if you know that Epstein-Barr virus you know is is doing some other stuff in your body that's negative shouldn't this be a reason to look at it for Ms but how do you get the data to do it given that 95 of people already have Epstein-Barr virus so here's what happened these guys at Harvard went to the military the U.S military the U.S military basically had 10 million members of the military take 62 million blood samples over a period of time from 1993 to 2013. and when they take these blood samples they you know they run their typical checkup on these people on the military members but they save some of the blood sample in a freezer and so they've got 62 million blood samples sitting in freezers the US military does and so these researchers were able to access those blood samples and they then found five percent of the they found the five percent that don't and they went through and they found that during this period of time that they have all this Blood data for they were able to identify 800 people that started out Epstein-Barr virus negative and then got MS a hundred percent of the people that got Ms were infected with Epstein-Barr virus during this period of time and for the group of people that um that didn't get Ms only about half of them uh got Epstein-Barr virus infection during this period of time and then they looked at this for about 20 other viruses and basically showed absolutely no correlation or difference in Risk between all the other viruses if you got Ms or didn't get Ms and so it basically creates a 95 probability that you're 32 times more likely to get um Ms from Epstein-Barr virus than from anything else it is from a racially diverse pool an age-diverse pool ethnically diverse pool so a lot of other you know confounding factors like race or ethnicity or genetics a lot of other factors like all the other viruses that might be causing Ms have been excluded and it shows that maybe Epstein-Barr virus is the primary cause of Ms that triggers certain people's immune systems to go nuts and attack the brain and it's interesting because you know Epstein-Barr virus has a bunch of proteins in it that look like other human proteins so it makes sense why this might happen Ms costs 40 Grand a year there's 30 billion dollars a year spent in the U.S on Ms care so if we can go in and get it I've seen Barr virus eliminated from the human body it would be an incredibly Incredible cost saving and a therapeutic benefit to people with Ms you should talk about the reason why we don't have a herpes vaccine though so HSV one two three now four none of these things have reasonable vaccines and it's for a very specific reason which is that the herpes virus itself is incredibly incredibly difficult to isolate and find until it activates and it hides itself and it nests itself inside these nerve cells so you may want to just talk about how complicated it is to produce it I mean the DNA disappears into these nerve cells and so it's hard to get you know immune system to go and clear them out permanently uh the Epstein-Barr virus hides out of B cells in your body and so it's floating around in your body forever and as your B cells replicate the virus replicates with them and then when your immune system starts to get weak the virus pops out and starts attacking and inflaming your body again so number one Epstein-Barr virus has never been a great Target therapeutic Target because there's not much money to be made because it's like who the hell cares about Mono once you get mono you get over it you're fine but if Epstein-Barr virus is in fact causing this problem with with Ms there's a reason to go after a lot of money to go after it and there are several new technologies and therapeutic strategies that are possible one of which is you know Shabbat sent out uh over our group text a company that's doing T-cell therapies we can actually program a T-cell and the T cell goes into the body and finds these uh these B cells with Epstein-Barr virus and wipes them out there's a steroid a diuretic steroid that's been shown that's used to treat high blood pressure that's been shown to stop Epstein-Barr virus from leaving cells there's an antiviral drug made by takita called meribavir which has been shown to have high efficacy and eliminating Epstein-Barr virus so there are now therapeutic strategies that are being actively explored that could unlock the potential of minimizing or eliminating Epstein-Barr virus for a broader population than we ever thought should be taking these therapies because the implications may be that if you can stop Epstein-Barr virus from replicating or eliminated from your body you can stop all these follow-on diseases that occur over time in your life that are super debilitating lastly yeah lupus is another one tied to herpes simplex 4. I think the the the real problem is going to be that two-thirds of the adult population under the age of 55 have herpes simplex 4. so you know you're literally talking about inoculating the entire world and when we start to think about that grand of a scale there's a cost issue there's a manufacturability issue and then there's an Roi issue that that unfortunately will be adjudicated and it that to me is what really you know stands out and that and that and that is that just the healthcare economics of it obviously the science of it is still really complicated aren't we doing an mRNA vaccine for Epstein-Barr and how would that play into this absolutely so there's a lot of techniques this is you know T-cell Therapeutics mRNA a chemotherapy type drug a steroid drug an antiviral drug so um every um modality for Therapeutics uh has some candidate or candidates for Epstein-Barr virus um and so you know there may be a bunch of ways that you start to identify risk factors and that you give someone one particular therapy that might be really affordable like this antiviral may be super affordable you know if we could make it for five cents a pill you could you know get it out to a lot of people prophylactically that are at high risk you know if there's a a group that actually is active with Ms a good treatment maybe to try and give them the T cell therapy and see if that helps and so that's the clinical trials that will start now because if you can give people a T cell therapy and eliminate EBV and and stop all future need for MS treatment that'll save 40 Grand a year it'll start to make sense to run clinical studies to see if that stuff's possible and is worth doing uh so it opens up a whole new kind of area of Interest now by the way this isn't novel people have been talking about this for a long time but this paper has such incredible data and such strong signal that it's really gonna it's really gonna catalyze investment we didn't have the big data based on this study we would not have gotten here for once on the show I will say thank God for the US government and all of the the the data that they've you know all of these blood samples I want to get your read on the the human transplant thing that we saw this week where a genetically modified pig heart was an implanted into 57 Jason you want a 57 year old man you want to read that out oh yeah David Banner a 57 year old man requested special emergency authorization for the experimental surgery from the FDA FDA who was dying and unable to receive a human heart transplant the surgery was performed on January 7th uh in Baltimore and um you know this happened as the U.S is facing a major organ shortage I mean we have we have hundreds of thousands I mean of people on organ donor Registries uh or needing a transplant you know my father was on a kidney transplant registry for eight years until he passed away uh these things are just brutalizing for the individuals and the family around it and so like you know all of a sudden if you can see a path where you can genetically modify uh other sources of organs and implant them without organ rejection into the human body that's like that is that's mind it's mind-blowing here's what's really important it's not just about the availability of these things but it's about turning off one of the biggest the the big risk factor of organ transplant is um rejection meaning you're putting all this foreign matter into your body it's foreign proteins and so when your immune system sees all those foreign proteins your body goes Haywire in price to kill it it's like this there's all it's like imagine getting a billion viruses at once and so there's all these new proteins and so one of the interesting things you can do you know if you can grow these uh these organs uh and and alter the genetics of the cells that are being used to grow the organs is you can get those cells to match your own or uh to basically down regulate all of the proteins that might be triggering immune rejection in your body so theoretically you could grow jaycal's heart with tissue and cells that match your DNA potentially and match your protein structure perfectly and it's such a had a heart you could do it with him too right there you go good transition but no I mean but and by the way there there may also be a path here where we grow these uh these organs uh with your DNA without even using the animal body uh the entire the entire key of the rest of the animal to do so so there's a lot of really interesting uh breakthroughs that are possible but but it's really great to see a highlighted um you know non you know kind of transplanted organ from another body into the human body because it's just again it opens up what people have been talking about for decades which is the possibility of this now that we have Gene editing and potentially having the ability to grow biological matter in bioreactors it's it's going to be it's going to be tremendous Jacob what do you think about the Democratic person in the SEC saying that they wanted to basically make the uh accredited investor laws even stricter that's incredibly infuriating uh yeah that was your big prediction yeah I mean we really have to get these laws I mean I think this is like a theranos um or wework overreaction which is like oh my god there are some bad private companies if you take the number of bad private companies uh and then look at what is happening in the country with people wagering on Sports and wagering on crypto uh Slash investing depending on where you know how you look at it we need to have one rule for the road which is people take a test they get accredited and then they can do what they want with their money the equivalent of what I'm suggesting people can only invest a fraction of the money they have on their last two years tax returns let's pick a number five percent of their two-year average on their tax returns ten percent whatever you want to pick and they have to take a test with the would be the equivalent of people having to take a three-hour course in a you know I don't know 50 question test to go to Vegas and play Blackjack and they could only put on the blackjack table ten percent of their total average yearly income for their household in the past year you think about how crazy that would be to tell an American you got to take a blackjack course and pass a blackjack test and understand the odds of poker or whatever to play that game and you can only put if you made fifty thousand dollars on average less years you can only bet five thousand in Vegas at any one time that's the max chips you can buy in a year those are the two things I'm advocating for in private company investing and that's really if we want to have people move from you know poor to middle class from middle class to affluent in this country there has to be Equity participation and Equity participation has to start early look at what happened with all these young people betting on crypto betting on stocks or stonks and uh you know doing puts and calls and all kinds of crazy things you know in public markets we would really rather see those people or at least in addition be able to invest on LinkedIn if they were a recruiter in year two or they were an Uber driver be able to buy Uber shares or if they were an Airbnb host be able to buy Airbnb shares as a private company will change the entire uh complexion of upward mobility in the United States and and we really have to keep educating people not limiting their upside that's my personal belief person who asked you the question stop paying attention like five minutes ago oh because we were talking about like 15 minutes ago and like you just that was a 90-second monologue for Henry what's that you know hashtags started like doing a little bit of artistic Direction you know he's got that Scorsese in him having done the award-winning film Thank You for Smoking and he he got Henry bellcaster on his team you know the tick tock guys Tick Tock guys after making some suggestions lightly suggesting sax has been directing not directing talk superfans saying hey you might want to make a tick tock out of this monologue here's what happened there there's a quote of a segment that somebody liked they retweeted they got a whole bunch of likes and so I sent the tick tock I said this might make a good talk right yeah nobody else doing that but okay okay we'll go for it I'm not editing but I'm I'm lightly suggesting again people do think that you have Tucker Carlson's writers writing for you because you say it and people don't know to be clear I that is a joke you do not have Tucker Carlson's current writer's writing for you there may be some I do admit I have a special writing team for Rose you do I'm just for us do you keep them on retainer like if you have a roast like you can just ask them to punch up some stuff for you or yeah I've only done it twice I did it for you for your roast J Cal and I did it for Phil Hellmuth destroyed Phil oh my god do you remember this is hysterical oh my God this is the cheapest roast ever they rented like a junior suite that they got for free at something yeah they got it for free they got it for free they had like 30 people in a room and they're like oh you got to come out for Phil's roast it was like 30 people in a junior suite at like a B level Hotel and they were so bad and sax and I came in and we had absolutely no allegiance to the audience I lost so much money everybody you guys were out of control it was brutal uh here's the helmuth roast I got I got the material right oh no oh no oh my God could you be sure these aren't our jokes this is what a Comedy Central writer wrote so we had well we do not endorse these no what well okay so if you remember what I said that how I work so they basically put together some material and then I shape it there's like some back and forth the workshop you worked yeah we Workshop it yeah go ahead it begins we're here tonight to roast the poker player known as the greatest unfortunately Phil Ivey wasn't available so we settled for Phil helmuth hey Phil is known as the poker brat the rest of the world just calls him [ __ ] Phil has mastered the GTO strategy of playing poker for most players GTO stands for Game Theory optimal but in Phil's case it stands for grading toxic and obnoxious despite all this uh Phil fancies himself a quote-unquote poker Ambassador not to throw a damper on things but calling Phil an ambassador for poker is like calling Bill Cosby an ambassador for Quaaludes oh no you can cut that one oh that's not that's too good let's face it Phil is nuts he's the only poker player sponsored by lithium and silence the poker table so you can hear the voices in his head and Phil was induction to the poker Hall of Fame they retired his straight jacket Phil is doing what all people on crisis do write self-help books it's called positivity which is ironic because the only thing Phil has ever tested positive for is narcissistic personality disorder that's so good this inspirational Tome is a whopping 84 Pages Oprah has taken inspirational shits bigger than this on Amazon it says people who enjoyed this book also enjoyed pounding their dick with a meat tenderizer oh my god oh you're you're a bunch of guys are good all right everybody hope you enjoyed Sax's excerpt from the Phil Hellmuth narcissist roast and we'll catch you next week [Music] and they've just gone crazy [Music] besties [Music] it's like this like sexual tension that we just need to release somehow we need to get Mercies [Music]








is chamath in a room with his pr crew right now like rehearsing and practicing and this pod is ruined [Music] rain man david [Music] hey everybody so i just wanted to make sure based on last week's pod it was absolutely clear i care about human rights many of you know my origin story but for those of you that don't i was born in a country that's no stranger to civil war and religious and political persecution growing up my family and i felt those effects it affected our safety it's in part what led my family to file for refugee status and stay in canada so this is a real part of my lived experience that said you know i realize that what i said last week lacked empathy particularly towards others who are dealing with persecution in this case uh the weakers and based on what i read this week i think what's happening to them in western china is a terrible situation i also want to talk about this idea about nobody caring look if we take a step back and replace uyghur with other really important issues like the conflict in yemen the potential war in the ukraine gun control school shootings health care equity we're faced with horrible events every day however the unfortunate state of the world today is that we've also normalized this routine of being confronted with something tragic or horrible or unjust and being allowed to react with thoughts and prayers and this was the real intent of what i was trying to get across so when i talk about my line it's not about whether something matters or not it's about which issues of all the important issues we face every day where i have the expertise and i believe i have the ability to have a real impact even if just by a little for me those areas happen to be climate change life sciences and deep tech but just because this is where i spend my time it's not to take away from any of the real work any of you are doing in other areas and then lastly i just wanted to explain to people who may be new to the pod because of last week that this is a place where four of us four friends talk about a whole wide range of things we explore our curiosities we try to learn from each other we challenge each other but we've always done it in a really supportive space and i hope you keep that in mind as you listen and watch going forward and hopefully can you can bring some of that to your own conversations that's all i have to say well said uh sex i mean i i know you have something to say but i'll say um i got a lot of messages this past week after the show where um which which i felt a little bit hurt by and mischaracterized and maybe it was simply i said the wrong thing at the wrong time um and so i i want to just be very clear about a couple of points if i can take a minute that's all right with you guys yeah so i said um i just wanted to i was gonna actually send this out on twitter and i decided it was better just to address it on the pod so to be clear i strongly believe in and support absolute freedom of all people and this means de facto i strongly disagree with the suppression of free speech denial of religious freedom imprisonment harm capital punishment slavery and genocide i thought this was obvious when we were having our conversation i did not be clear you're not in favor of genocide i'm not in favor of genocide i'm not in favor of slavery or capital punishment or suppression of religious freedom i thought this was obvious the conversation i tried to have was the wrong conversation at the wrong time which was to trying to talk about the broader china v u.s narrative that is swelling and will continue to swell this decade i think that the primary function of civilized society or any advanced social system is to take care of and protect those that cannot take care of or protect themselves and this is usually done by government but when government fails and government is in fact the oppressor i think it is the responsibility of other governments and other peoples to step in and have a voice and to take action and so that is um that is kind of my moral framework i think it's important i don't deny any of the harm being done to the uyghur population in china i don't agree with it on a principled basis and i don't think that what the chinese government is doing is right um and the point that i was trying to make during our conversation was a very different one that i think got completely lost in the moment which was really just about what's going on with the china u.s narrative right now i'm not pro-china i'm also not anti-china i am particularly interested in understanding the broader china u.s dynamic and what it means for the world over the coming decade and decades i think it's really important for us when we evaluate these things and to understand them to not just take sides but to understand the context in the broadest way possible and that's why i'm trying to get both sides and understand the mindset of the people that are involved in running these governments and the way that this of this world is going to evolve as this economic tension continues to mount um and so that that's where i was trying to go um and i was just trying to highlight where i think everything is headed over the next decade or two independent of what are obvious human rights issues going on so let me just stop there and say thanks for letting me say that but that was important for me to just be really clear on because clearly i wasn't clear last week so well and i i'll i'll just add to what you said that i also thought it was implied that you care about these things and that you're not in favor of them i didn't think that need to be spoken yeah so i think it's it's nice that you're clarifying it but i think any reasonable person would understand that if you care deeply as a vegan about factory farming that you also care about humans and you know genocide and torture or whatever issues so i i think it's like a your statement is so obvious that i i wonder if you even had to have made it but i'm glad you did sax okay so uh i guess first i i should say that um you know what's happening to the uyghurs in china is indefensible you've got reports of upwards of a million you know of these people being held in detention camps there's reports of mass sterilization and rape it's like ethnic cleansing over there so that's absolutely wrong and it's one of a growing list of issues that we have serious problems with china on which include theft over intellectual property cyber espionage the bullying of their neighbors uh their crackdown on dissidents the list goes on and on i mean i think we have to be clear-eyed about the challenge and the threat that china represents and we've discussed that on this pod many times that being said you know what i think we saw this week was really about cancel culture right you had in response to last week's pod you have this online mob form and uh they want to take what jamaa said and interpret in the worst possible light so they can turn the outrage meter up to 11 and everyone gets to basically go on twitter and virtue signal and say what great people they are and because chamath is a bad person and i just want to speak to that issue i mean there's a huge amount of hypocrisy going on in that because how many of the people who are tweeting their outrage and their denunciation of chamath are doing it from a device made by forced labor in china wearing their nikes made by forced labor in china on their way to target to buy cheap goods made in china how many of those people have actually lifted a finger in the real world to help the uyghurs how many of them have sacrificed an economic benefit uh in any way and so when shema said nobody cares i thought it was a really startling statement by him but if you define caring as doing something more than just virtue signaling and expressing your feelings as actually making a sacrifice or taking a risk in the real world i thought he was frankly telling us a very uncomfortable truth we haven't really most of us done anything and in that sense i think the reason why his comments hit such a nerve i don't think you get the kind of pylon that we got unless he's saying something that's hitting a nerve and i think the nerve the thing that he exposed is that we're not really doing more than virtue signaling on this issue and then came all the you know all the hypocrites you've got the nba denouncing him issuing a statement when what have they done i mean when daryl mori spoke up uh on behalf of the protesters in hong kong the nba shut down and sanctioned him and uh you know lebron james said he was uneducated actually i think jeremiah was pretty educated about what's going on so you've got those hypocrites you got the white house issuing a statement disavowing chamoth but hunter biden went over to china to manage billions of dollars for them and profited by his business dealings over there so they're a bunch of hypocrites and the list goes on and on and so you know i think that if in order for the mob to summon the outrage that it summons it requires them to i would say first put the worst possible light on which moth is saying and to ignore i'd say the fundamental truth of it and second to engage in this massive hypocrisy and that is the way that cancer culture operates and i don't think we should buy into it um so i appreciate what what chama said i think he's clarifying his remarks he's showing that he does care and he does have empathy as we all should but i think there was a fundamental truth in what shema said last week and that is what people are so uncomfortable with okay well said um i have feelings um and most of all i'm thankful we had the discussion the goal of this pod i think what makes it special and why y'all who are listening come here every week it's because you know we're going to be honest with you and we're going to tackle these hard discussions and i think friedberg's uh comments and sexist comments uh really uh explain that and what our intent here is and is human rights is one of the hardest issues to discuss that's why you don't hear it being discussed and there are not easy answers and i think you know i was challenged uh by my besties on the episode and their questions and their challenges were absolutely critical yeah yes how can we care about one group of people when the people in our backyard we're not caring about are we going to invade countries these are very nuanced difficult questions but we must have this discussion and if we try to cancel people with a 20-second clip that looks completely different if you look at the 2-minute clip or you take the time to have a 40-minute listen of the whole segment you get a totally different picture and i i think it's very important to raise awareness about human rights and it is an issue that i have been passionate about my whole life and i'm not trying to virtue signal or score any points here but i know firsthand that raising awareness and having the discussions reduces the violations because dictators despots and people doing this kind of stuff do not want the heat of what happened this past week and what happened this past week is that more awareness was raised about the uyghurs and the situation that they're going through i think then you know as somebody who's modded the situation then i've seen in the last couple of years perhaps this was a tipping point and that is something good that can come out of that discussion now on a personal basis i have uh had some feelings of guilt um because i was very hard for me to watch what happened to chamoth this week and to watch people dunking on him um and then let's face it i brought the topic up and i dug in with my feelings and it got a little heated and and i'm suddenly being portrayed as you know a hero in this discussion that's not the intent and there's there's no hero or villain in this there is a hard discussion in this and i am extremely proud of my friendship with each of you especially you chamoth i'm extremely proud of your candidness and tackling these issues and making people think about that and you know i'm just so proud to be friends with each of you and i'm so proud of the work we hear we do here every week and i think it's important work um and i feel like i get smarter every week and and i hope the audience does too and i hope we can keep having these discussions um can we make fun of each other yeah now let's yeah make fun of each other i mean i don't know if we're allowed to laugh this is like so serious and heavy but so what you're saying is thank you chamath now that's gonna be good for 20 i mean look we've talked about cancel culture a lot on this show you know we've always been i think generally able to be third-party observers so what's happened and it was really interesting to go through the cycle this week where um you know there was just kind of a an echoing narrative uh on one thing that was said with one direction there were a few pieces though chamath right i mean wasn't there a piece from the atlantic and some other pieces that kind of highlighted that things that you said were things that a lot of people won't say and that's what was really so shocking for so many people what's the peter thiel comment on this whole on all of this stuff yeah he said if if no one's saying it it's probably true or if you're not allowed to say it it's probably true yeah if you're not allowed to say it yeah but um yeah it was uh well you really think based on the the mob that formed and you know it's already kind of blown over and that's the way this kind of cancer culture starts but for that sort of uh that wide hot really intense day or two you would think that like chamath had practiced genocide himself you know you know because everybody comes out and the way that they make themselves feel better is by virtue singling on this issue and again i would just say that i think we should be thinking about what do we do um you know how do we actually make a difference because i don't think just virtually on the issue is going to do it um and you know at the same time that this mob was forming against jamaath we had a two hour biden press conference in which biden never mentioned the uyghurs once the press corps never mentioned the uyghurs ones so does that mean the uyghurs are below their line um you know why wasn't it mentioned you know shouldn't we be ganging up on biden why is you know why is the press ganging up on tremoth when they're not getting up on biden for that so there is a fair amount of hypocrisy here i actually think jason i think you make an excellent point that by discussing these issues and raising these issues it creates a little bit of a check on the people perpetrating these atrocities because they don't like to be exposed that way and you know maybe we should be boycotting the beijing olympics i mean maybe that should be on the table maybe we should be boycotting the nba i mean let's have that conversation yeah or maybe everybody who goes there i wouldn't want to see the athletes miss the olympics but maybe they could each just raise their hand and do a you uh or some sort of a signal to show they support the situation or they're aware of it uh with the uyghurs there could be some you know modest protest or statement they could make without ruining you know their lives work i always hate when the olympics get cancelled for some political reason because i think those people work so hard for it um but racing awareness you know is a noble goal in all of this and then also doing things is a noble goal um and um yeah i mean i i i it was very weird to watch the the mob form and then dissipate and just who was you know taking the time to actually listen to the full episodes it was clear from that atlantic article and some of the nuance takes that they listened to the full discussion because there are bullet points here like like there was somebody asked me a very challenging question i think it might have been you freeburg like are we going to start invading countries over human rights and then there's more suffering and death and pain from the wars and and when do you decide as the the democracies of the world to invade the dictatorships of the world to promote human rights like this is a very difficult issue uh that the world has had to deal with sadly before and there is no easy answer there you know right well you're right this is a point that i also tried to make on the last episode like freeberg did which is um i i think it's i think it's actually great to have these ideals and we should have moral clarity about what's happening and i think it what's happening is wrong it's outrageous it's an atrocity um but but the question is what we do about it and um and the the reality is even though it's important to speak out about human rights these types of fulminations about human rights when they become this sort of you know when people when we get into this like frenzy it's been the prelude and pretext for every misguided foreign intervention that we've had over the last 20 years and the example the iraq war i mean saddam hussein was suddenly hitler um you know the goals of nation building afghanistan for 20 years our invasion of uh libya we got rid of gaddafi and we replaced it with chaos for years we were talking about how evil the taliban and their social system was and then we just handed afghanistan back to them a few weeks ago exactly so you know and so these types of um you know when you kind of you whip people up over human rights i mean i agree with the sentiment and i agree with the moral clarity but i also can't help but recognize that neocons and the military-industrial complex and the washington blob have used this type of rhetoric for decades to corral us and stampede us into wars and foreign interventions that don't make any sense and we all recognize after the whole project has gone wrong like afghanistan we become suddenly more realistic about the whole thing and suddenly you know we're not talking about you know the the the sort of the moral atrocities of the taliban anymore but the discipline is still there they're still there the discipline though is to be able to check ourselves before we get into these interventions and i don't think we do a good job of that we're whipping ourselves up into these mobs and we're in a frenzy and the the raising awareness is something that has been lacking you know certain organizations and i think it's very important that we don't take organizations that have engaged with a country let's say china or saudi arabia they may have engaged in good faith with the goal of you know engagement is a positive for humanity in the world okay if we engage with china and we are co-dependent on each other um that will lead to a better arc for human rights and for humanity and less wars because our economies are entangled and we do business together okay this is a fine premise what the dictators and despots want you to do is to fight each other and not look at the human rights atrocities so it's easier for us to say oh the nba oh apple oh you know pick the uh the the company or corporate interest or organization that has engaged um but by raising awareness um consistently it gives other people the ability to talk about this some organizations weren't willing to even talk about this or say the name uyghurs and if we keep talking about the uyghurs the chances that that situation improves i think there is a chance it does improve but i do think this like notion that the four of us can get together on a podcast and not get cancelled because you know we don't collect money from advertisers and we started having these conversations amongst friends and we just put it on the internet um first of all it's a great kind of reflection of what you can do in the united states with the freedom of speech that we have and we can just put this on the internet anyone can watch it around the world uh i don't know how many people are watching it but mostly freedom of speech mostly freedom of speech um but i do think that it's it's pretty valuable and i do think that that's you know an important point for us is you know as much as chamoth got completely destroyed this week um you know the i gotta i gotta say other than covet i'm uh i'm feeling pretty good you feel better you're pretty bummed for a day or two i mean i think the the covet thing was scary because four of my five kids got it um so i was just like oh my god how's everyone doing by the way i'll be very honest with you so uh between both houses um you know mine and my ex-wife's four of the five kids got it our nanny got it nat did not and the youngest baby did not uh there's a real difference between in my house how the boys experienced covid and how the girls experience covet quite honestly it like we ex you know we've expressed certain symptoms specifically a really bad sore throat and a cough that the girls in her house did not the girls had more intestinal issues the boys roughly did not so it all manifested kind of in odd ways uh but oh my god i mean a lot of pain in the ass well to be going through that and then also like monitoring twitter and inbound your phone must have been blowing up i wasn't doing any of that okay jason start the pod let's go all right well okay everybody welcome to the online podcast with us uh the sultan of science who's got a new startup he launched we'll hear about that later in the show the rain man himself and dare i say the dictatorship i was like it's not like we it's not like we didn't warn you we had a 63 episodes we called them the dictator this was about to happen let's start the show everybody you guys were like after 20 years of friendship it's like i don't know the list is like 9 000 items long i was like yeah if you're gonna cancel them we got a log list all right uh so first up i think we should start with um a a duo of stories that relate to each other microsoft announced it's buying activision blizzard for 68 billion dollars of cash microsoft's got a lot of cash um and i think we all understand like why this is a great idea for microsoft with xbox and obviously activision owns call of duty which has a hundred and twenty million or so monthly active users they also own a bunch of nerd stuff uh from blizzard like diablo world of warcraft my favorite starcraft and those have upwards of 40 million they also had black king if you remember that they make candy crush and those kind of casual games which have a quarter billion users uh but even with all these uh it's a highly fragmented market but in related news alina khan the i believe 32 year old head of the ftc uh who has written a bunch of pieces we talked about this on all in episode 36 sat down with kara swisher and andrew ross sorkin for an interview and basically we're moving or she intends to move the goal posts on antitrust i want to play three clips and have you each react to them here's the first one and this is her take on changing the antitrust from consumer harm to uh now shift to does this deal and we'll take the activision deal here as but one example but you could take the instagram and the youtube deals as well do these deals substantially reduce competition in the future let's watch the first clip in certain cases maybe too much success and so the question is when is the regulator supposed to say this could work and if it works it's actually worked too well it's an interesting question and i think you know for enforcers the the real question is is this the deal that could lessen competition and in high intensity all deals to some degree to some degree substantially less in competition or tend to create a monopoly and there's also indication that congress wanted enforcers not just to act when you know the third and fourth companies are merging are the first and second but actually in the incipiency when you said see trends towards concentration that those can also be important moments for enforcers to jump in so uh what do we think uh freeberg about this sort of new rubric not consumer harm because obviously if microsoft buys activision and makes those part of game pass then you get call of duty for free with your game pass and the candy crush games and blizzard games that's good for consumers they get a whole bunch of more games it would be like disney buying star wars you get all the star wars stuff in disney plus for the same low price yeah look sex is our legal eagle here but i'll just say um before uh you know he probably speaks better informed than me um if it's not about consumer harm and it's about decreasing competition in this broadly i would argue subjective sense then um what's scary is that there are going to be decisions made by interpreters of what is and isn't competitive and ultimately if they're not trying to keep in mind the best interest of the consumer then it is in fact going to cause consumer harm at some point not necessarily in all deals that they block but there will be deals that they may block that may have benefited consumers meaning prices go down imagine having all of your products integrated in one streaming service instead of having to pay for three streaming services so instead of paying 70 across hbo max and disney plus and netflix you get everything in one but today the regulators would not let those businesses merge because that would be anti-competitive under this context and so this is going to be a touchy debate and it's going to be difficult i think ultimately to rationalize this if there is going to be a point in the future where we can actually show that consumer harm would be caused by decreasing competition in the marketplace and so i would be nervous about that subjectivity and the slippery slope it enables i think it's a great point think about it if you had to pay instead of for disney plus you paid for pixar plus disney plus marvel plus and star wars plus would be chaos in your household to manage all those accounts it's a much better offering better consumer experience yeah much better consumer experience and and cheaper and this actually by the way i said sorry i'll say this is why i said in the past it's we use the term monopoly as if it's de facto evil and bad but not all monopolies or businesses that have very big moats is another way to kind of describe them are necessarily bad for the customer you get cheaper products you get better products you get more of an advantage they may ultimately be yielded to be anti-competitive harmful ones let me not necessarily always but let me explain to you where she's coming from like there's a fundamental pillar of capitalism that says that excess returns must get competed away so if a capitalist system is to be efficient if a company has profit margins of 99 competitors emerge pushing those profit margins down to something reasonable where you get to some sort of equilibrium and the whole principle of what she's saying is in in the absence of competition we don't really know what the equilibrium return really looks like and she's not saying that but that is the implicitness of what she's saying and so in the if you allow all of this stuff to aggregate maybe google shouldn't have 45 ebitda margins maybe in a really competitive society they would only have 18 and that's actually better net net for the system the problem is that counter factual to your point free break is impossible to measure how do you know and how much value do you need to take away of the panoply of things that google does to figure that out and that's i think we're the problem with it but you know let's be clear i in 2019 i wrote in my annual letter there's a section called the the tightening of the regulatory noose and meaning it was a framework for how to basically dismantle big tech and element number one of that was a changing regulatory landscape and it's really incredible to see it in front of our eyes we got a bill that just left judiciary right that was effectively voted across the aisle that's now going to go to the floor of the senate which is going to rewrite some of these anti-communities it's like 75-25 and it was a 50-50 committee of democrats and republicans so clearly across the aisle clearly across the aisle uh and i mean the funny thing about that was feinstein and padilla the two democratic senators from california where most of these companies are in in the wall street journal article that i read railed against it but still voted for it to go to the floor so it's i think some version of that is going to pass she's going to go and scrutinize these companies i still think this microsoft activision deal on balance gets done because if you take the absolute values away from it the reality is that it's an adjacent part of microsoft's core business and there's nothing fundamentally monopolistic about what would happen if you let microsoft and activision come together could it reduce competition in the future i think would be her new lens and if xbox has call of duty and sony playstation doesn't or the next console doesn't maybe it does uh you could make the argument saks what are your takes on this very hard to apply standard of reducing future competition because as aaron sorkin said very clearly all of these reduced competitions now we got to get into what does the word substantially mean in this context yeah so my take on on leita khan is that she's got some worthwhile observations on the problems posed by these big tech monopolies but i don't think she's got the right remedies so on the observations i think she's correct broadly speaking that these big tech companies the fangs they have way too much power in the marketplace there are now gatekeepers over the internet that control all these powerful platforms and broadly speaking it is time i think to uh to basically have some limits on those powers make sure they don't abuse it i think she's also right that the traditional standard of consumer harm doesn't really capture that sort of concept of market power for these free ad based services right because there is no pricing um and furthermore i think she's got a point when she says that you know when you say no pricing you mean facebook and google the consumer doesn't pay so how can there be consumer harm right so clearly that there's that standard of consumer harm doesn't really capture the market power dynamic and then i think the last observation she makes which i think is pretty pretty valid is this idea that you know when facebook bought instagram at that time it didn't seem to be a problem but it definitely allowed them to extend their monopoly from the desktop into mobile and it probably should be scrutinized harder my problem is with her remedies i mean what she's basically saying is first of all like you said any deal that could decrease competition in the future is a problem well the whole goal of business and making business moves like an acquisition is to build your moat is to win create a more competitive offering so there's no limiting factor there's no bright line test there at least with consumer harm there's a bright line test which is about pricing right it's mathematically measurable you could create a model around it here there's absolutely nothing and so what it's going to do is completely politicize the process of getting a an m a deal approved and you can see this when she's talking about the impact on labor i mean this is a total s uh this is a total sop to the labor constituency in the democratic party because look facebook and google no matter how powerful monopolies they may be they don't have a dominant position in the labor market this is not true they're competing for the same engineers that every tech company is competing for so she's bringing a purely political consideration in now and so again there's no bright line rule it's gonna be heavily political companies trying to get a merger approval never know whether they're good or not and even after they get approved they'll never know they're good and i have a big problem with her saying that any deal that they approve can be reopened and reevaluated right a decade into the future and reverse the actions they're taking companies need certainty that's the that's the real issue it's the the rules of capitalism have been that a smarter slash more strategic s you know entity if they can run their plays more efficiently has the right to win um this is almost trying to say actually not really and that is very problematic yeah so you never know you're good you're never known you never know you're good and then the problem that it'll create in the equity market specifically is how do you actually drive shareholder returns and then what do all these shareholders then do if these companies are rendered to basically stay where they are and you take a snapshot i mean you take a snapshot of the economy and you say this was what it will be from now on but staks's point is really interesting it's going to require m a to become kind of a political maneuvering process similar you know create sort of these uh you know um obfuscated gates where you don't really know what it's going to take to get through there and then you've got to go do what you do when you try and convince foreign governments to work with you or allow you to do a transaction in a foreign government in a foreign country where you got to go in and you got to go figure out the politicians who they want who they are what they want and then put together a political consortium that's going to approve the deal given that there's now going to be subjective uh you know validation whereas before i think the the criteria were much more objective let me play this other clip this is the clip that the sax was referencing alina khan also talks about how labor uh unions are trying to get in on the action slash griff see on the other side some of this research has showed that labor markets are significantly concentrated um and it's led to you know additional thinking at the policy level of how this should be affecting what anti-trust enforcers are doing so the justice department including in the last administration started looking at no poacher agreements more closely instances in which employers may be colluding to suppress wages both agencies have been looking at the ways in which mergers in particular may lessen competition for labor um and have downstream effects on workers in ways that are harmful and that also needs to be on our radar so i think this is an ongoing conversation but increasingly the question is you know how we implement some of these priorities and not you know whether they're important but this is the first time you've included labor this is something labor's wanted for a long time the idea of looking at antitrust through the lens of unemployment essentially yeah there's an interesting history here i mean um you know there were cases in which uh you know unions were supportive of transactions because they thought they would lead to more downstream benefits but i think we started to see uh through retrospective studies instances in which you know mergers actually ended up having a harmful effect and so i think that is what's significantly contributing to this this is this is also part of what i said in 2019 the third element of that plan was you have to change the rules on stock-based compensation so instead of her talking about it as labor i think the the more accurate way to say it is like there's very valuable human capital in technology business a few people have you know discontinuous impact on these businesses and it has been a stated strategy of all of big tech to use their balance sheets to buy small companies in their incipiency to use her words not because it helps advantage their monopoly but it prevents the leakage of human capital into other ideas and it prevents those other ideas from literally flourishing that's really what's been happening for years in silicon valley and we all know that you know all the aqua hiring we see is about hoarding talent and you'd rather pay these people millions of dollars a year if you're a big tech to basically work on next to nothing then take the risk of them going across the street to a competitor and then having them build something that disrupts you yeah and this was such a this is such a no the only way but feel sorry just to finish the old one of the ways that you can change it is you have to change the way that stock-based compensation works how it's accounted for how you know how you can actually deal with it on a gap basis how uh capitalists then treat that in terms of their earnings if you don't do that none of the models change people look past it people look through it they don't think it's a real cost which it is and then you're allowed to continue to do it that's really the underlying issue so much so chamath that the human the hoarding of human capital was a reoccurring theme on the silicon valley hbo show where people in huli were getting paid millions of dollars and hanging out on the roof uh freeberg when you look at this uh human capital labor being brought into it isn't the point of a lot of m a to um eliminate jobs and eliminate redundancy so if you brought in youtube at google i'm not sure if you were there at that time period the distinct concept was hey we already have an advanced ad network we already have accounting and we already have servers around the world and storage you don't need to hire those people we can get rid of them or whatever and we get rid of that redundancy large-scale consolidation that's certainly true most m a in technology is the opposite where an acquisition takes place and the acquisition gets fueled by further investment after the acquisition is made when youtube was acquired there was a few dozen employees there and then very quickly google scaled that team the engineering team the infrastructure team they even had their own independent ad sales team um to thousands of employees and without that it would have been very difficult for youtube to achieve that scale both from a product success perspective an infrastructure perspective but also an employee-based perspective with the amount of capital it would have taken to go and raise that from venture capitalists maybe nowadays where there's billions of dollars floating around it would be different but back then it would have been very hard and so what's the same for whatsapp and instagram yes exactly whatsapp was 19 people when it was acquired and now it's thousands i'm certain and instagram's the same and so what we've seen traditionally or not traditionally but over the last 10 15 years with internet-based acquisitions is not about consolidation and reduction in costs but about taking and enabling technology and accelerating it on an existing platform now number one it makes that new technology a product far more successful far more far-reaching and more consumers benefit from it number two is it now makes that platform harder to compete with so as a platform it's going to be a lot harder to catch up with the cash flows being generated at google and facebook given how quickly they reinvest that capital in new technology to further their advancement to your what's been so significant over the past 15 years that people are lifting their head up is that it has been both beneficial to consumers and anti-competitive so that was exactly what i was going to get to here your youtube example is the perfect one because if you look at youtube think about all the joy education communication it has created on a global basis and it's free and that has helped humanity so much in this new lens but no one else can make a video ad site like this exactly we're now looking at all the benefit that youtube has created for humanity versus the fact that it's going to be impossible to depl displace youtube now to your point sax how do you get past the bright line do you have a suggestion for a way and would you now look at something like youtube and say we shouldn't have allowed that to happen youtube was on debt store because of the lawsuits and the server bills we all know that right well this is the uncertainty that's going to be created and i think this administration is creating tremendous business uncertainty i think the reaction of a lot of big tech companies is going to be to stop doing m a until the situation gets clarified because they just don't know um you know targets are target companies are going to want to have huge breakup fees and it's just going to have a chilling effect on the market for m a i mean business needs certainty and they're not giving it in this business environment um before we get to you just let me kind of make one point about that last clip on on the labor point listen this feels to me just like when the administration uh talked about cleantech and clean energy and electric vehicles but then they only gave the subsidy to the uh car companies that were uh that were basically union shops and so give tesla the same that's right they excluded tesla they excluded tesla from the eevee somewhere they tried to pretend that ford and gm were the ones driving the eevee revolution in the us it was laughable what they were trying to do there is they were shoehorning a union agenda into clean tech and i think that's what lena horne was doing in that clip she was shoehorning a union agenda into anti-trust law and it's a bit absurd because facebook and google even though they are very powerful companies when it comes to talent they are in a war for talent just like everybody else they compete these are not facts these are not mistreated employees these are very well paid employees and moreover the market is highly competitive and we don't need them trying to insert this union agenda into anti-trust law you got to think that for example going back to microsoft activision obviously the bankers would have called apple and facebook and google as well i mean it's absurd that they wouldn't have yeah it has to be at the minute that you think you have a bonafide offer one of the things you have to do is essentially you know get an opinion letter and also to make sure that as a public market shareholder you can justify that you've evaluated all the other options right sure um but it's really quite telling to david's point i don't think that if you were facebook or google or apple you could have credibly made an offer because the calculus in the back of your head was not whether it had business logic but whether you could actually get it through the ftc but microsoft did because microsoft is no longer seen as a threat and look we said this we said this in our awards show two or three episodes ago you know they have really been the most untouched uh in the last decade by antitrust scrutiny whether it domestically or internationally they've largely skated under the radar after paying the price for an entire decade i think a lot of that has to do with the fact that microsoft's effectively pivoted with the exception of this gaming into being an enterprise software company and the politicians just care a lot less about enterprise software it doesn't capture the public's imagination it's the big consumer you know companies that get all of that attention that's the fascinating point like literally the consumer and the bread and circuses of this is what's driving it like people hate big tech and trump got banned from it yadda yadda but i gotta say you know these um increasing restrictions on big tech and the these prohibitions and the chilling effect the uncertainty it's one thing to do it when the market is just completely ripping and we can sort of afford to run these experiments and tinker with these these rules but i gotta say i'm i'm starting to get pretty worried here that you know we had jeremy grantham as sort of an old school yeah old school kind of bearish type market commentator he had this expression that the yeah i mean it's more one of these stop clock right twice a day things here jeremy grantham has never found a market he didn't make it yeah yeah exactly but but but a stop clock can be right twice a day and um the line he had today is that we're seeing the popping of a super bubble and you know we've been talking about bubble yeah exactly basically but that's not that's not true but i mean it's good it's evocative well the the sense of which it might be true is that i mean we've talked about this last few months is that you had the fed and the the the federal government pump a 10 trillion of liquidity into the market over the past two years because of covet now they're starting to pull that back and there was i think a general asset inflation across asset classes certain types of assets clearly got more inflated than others we've seen a huge correction in growth stocks we've seen a huge correction in uh in crypto basically anything long-dated as the fear of interest rates increasing has gone up they've massively corrected but so the concern is that you know with the losses we're seeing and i mean every day it just keeps i keep seeing more read that this could turn into a recession you know popping of bubbles is usually followed by uh by recessions or so i think you know the fortunes of the economy could turn really quickly here and that is that is the marginal risk the marginal risk is actually for a recession we we talked about this before by the way just to your point you're right that we pumped in 10 trillion dollars but over the last three weeks and really over the last two and a half months we have actually eviscerated 10 trillion dollars of value as well so if you want to measure it we put 10 trillion of excess capital in but we've now destroyed 10 trillion dollars of equity by lowering the prices or pricing stuff yeah we've been pricing the crypto i mean crypto in the last couple of days has just been flat uh growth stocks have been shellacked um biotech stocks have been just absolutely smoked everything is getting crushed uh but david is saying something really important the risk in my opinion is not of runaway inflation anymore and the reason was what happened this weekend was incredibly important and we have seen this happen just a few years ago so this weekend uh china cut interest rates now as we know we are dealing in the united states with this issue of whether we should raise rates and by how much because we're worried about inflation well if you're cutting rates it's because you're worried about the other problem which is that the economy is basically turned over and you need to become more accommodating right you need to incentivize businesses to spend by like turned over you mean it's slowed down people are not building companies not doing new projects so you want to inside you want to give them an incentive or maybe some catalyst to start some new company or start some new project because all the real estate projects have wound down in 2018 here's exactly what happened the setup was the fed we were everybody was worried about what the fed was going to do on interest rates the fed was looking at china as the canary in the coal mine the leading indicator of what we should do and at the end of 2018 jerome powell decided to raise rates and we raised rates and then entered 2019 and the chinese economy turned over and we realized that their economy was not nearly as strong as we thought it would be and so our reaction was disproportionate to what the actual data on the ground said we entered a recession in 2019 that's when you guys probably saw trump going crazy blaming powell i mean most of us ignored it because you know we were all dealing with you know trump derangement syndrome but the underlying thing of what he was saying was hey hold on a second uh you just caused the recession in america by raising too quickly the fed is now in this really delicate situation where china cut rates last week we have an fomc meeting the open markets committee that sets rates on wednesday i think of this coming week what is he supposed to do you know bill ackman two weeks ago was advocating for a 50 basis point raise in this meeting so that's way beyond what people even thought is supposed to we should just remember that bill ackman has bets macroeconomic bets in the market if he's calling for a 50-point raise i guarantee you you're gonna make a lot of money you'll make a lot of money no conflict no interest yeah yeah my my only point is the setup is a very complicated one for the fed coming into this week and the risk is to a recession because if we over correct yes and the leading indicators all around the world tell us that their economies are weak then inflation may have actually been much more transitory than we thought and right now we have to decide because if we over correct we're going to plunge the united states economy into a recession this is why i think friedberg when you look at this when you have so many different things happening at once and you're trying to pilot a plane or a car you know in rain on ice going really fast maybe there's something wrong with the brakes and you got to be very delicate with you know how you steer into this what is the right strategy here on a policy basis coming out of omicron um should we just take a pause on raising rates what what do you think the right situation here obviously putting a bunch of regulation on top of big you know mergers and acquisitions and that's going to create headwinds i i don't know how many different variables we want to add to the mix of an economy that feels like we're in a perfect storm i don't know like a lot of us kind of talk about the valuation of things in markets as being the economy but it's not the economy is the productivity of businesses that are valued in the market and as long as the productivity of the businesses in the market continues to improve that businesses continue to grow that there's stability to pricing that's not runaway or or declining neither inflationary or too deflationary um you know i think those are the the indicators that matter most now the reality is over the last couple of years we've had trillions of dollars that have flowed into these markets for free and those trillions of dollars have created lots of mini asset bubbles lots of little new markets have emerged nfts random crypto currencies that don't actually do anything the collectibles market the art market there are lots of i mean there are and lots of examples of these speculative early stage businesses that have gone public and uh people backed them and they they said look when there's this much money around i'm going to start making more risky bets i'm going to make more speculative bets and uh regardless the money's coming out of the markets the money's going to come out one way or another and as it starts to come out these little bubbles are the first that are going to pop and that doesn't necessarily mean that the economy is at risk it means that there are valuation bubbles that are going to burst they're going to decline and no interest rate policy is going to change that because the inevitable growth in the underlying economy the inevitable end to the pandemic is what's ultimately going to drive capital out of these markets and back into ultimately more productive assets and less speculative assets and so this is a transition that i'm not sure you can really kind of manage i think underlying businesses and the growth of the economy and the ability for people to get jobs there's an incredible number of open jobs are in the us right now three million open job listings go apply for a job eleven million whatever it is go go go sign up for a new job three point what is it sacks three they're very very million three point seven percent unemployment they're not a lot of people yeah they're not a lot of people in the us that don't have an option to go out right now and go improve their their working condition there are a lot of open jobs in the us and salaries have gone up that's what i mean your working condition you can go make more money and um and so you know the economy underlying there are lots of great businesses that are growing and doing well and there's stability that's emerging and then there's a bunch that aren't and there are a bunch that were always speculative and that they were hyped and overvalued and you know as those assets get devalued a lot of us that have most of our worth and income coming from capital are uh are going to feel the burn i have two questions by the way that we if we could do if each of you could do one thing to one or two things uh to manage this economic policy in the next year what would it be like what two things do you think we should do david one or two things be the top of this that regulators should do in terms of managing this seemingly chaotic situation just not due it just feels to me like we're pinballing from one overreaction to another so we overreacted in terms of flooding the zone with liquidity because of covid i mean remember like druckenmiller it was like the one of the only voices about a year ago when they did that to that last two trillion dollar stimulus bill the covet relief bill yeah and he said look retail is already 15 above trend meaning if you looked at demand the demand side of the economy it had fully recovered and was actually above trend people were spending more money and then we flood the zone with another two trillion and then lo and behold six months later we have this inflation and then in response to that inflation we're now jacking up rates so quickly that i think we're risking to tomas point a recession so we're pinballing from one over reaction to another and i just the big meta thought i had this week with just how many of our problems are just self-inflicted right now i mean even on covid right we could live with this variant of covet omicron you know chamath and all of our friends we've everyone i know in the last few weeks basically has had it and it's been very mild it's basically been a cold but in large swaths of the country we're not choosing to live with it we're at each other's throats about these vaccine mandates these other restrictions and okay so your closures and similarly and and the same thing just to make even more local we've got a crime wave in america going on right now why because we emptied the jails last year and stopped prosecuting totally self-inflicted okay so what things do we need to do just if you had one or two things that you think we should do one you said we're ping-ponging so do you think more consistent policy community i don't i don't i think that you want some neat little answer that's tweetable and there is none no i just i wanted you i mean let me explain i thought there's no one or two things anybody can do i think there's a collective set of things that we have to do in an organized way so look just to set up right um we have had more activity and hedging than in any other period in recent memory except the great financial crisis just to set the tone of where we are in terms of volatility in the capital markets mutual funds who don't short stocks right the multi-trillion dollar mutual fund complex whose only job is to buy has been a net seller hasn't even started buying a single thing yet we have an fomc meeting that's going to happen next week where jerome powell and the you know the fed has to decide what to do in the face of incomplete data it's not as if we've even stopped all of the purchasing uh of assets that we've been doing we're still putting money in the system i just want to be clear we were debating when we stopped the spigot we're not even debating when we shrink our balance sheet as a country so we are in a really complicated moment and i think the risk is that there is an overreaction to incomplete data and we plunge the u.s economy into a recession and i just think that that that has to be really thoughtfully measured and we guys we've seen this in 2019 2018-19 africa any thoughts uh no i'm not an economist and i'm not a central banker and so i have no clue okay um the next thing but tomas point i mean we are dealing with balancing the risks of inflation against the risk of recession i think that is fundamental and right now all the statements have been so hawkish that you know the markets have been just flowing red now for months and it's starting i think i think the the balance of risks is starting to make recession possible in a way that didn't seem possible two three months doesn't the repricing of assets though like we look at peloton you know it's down whatever 80 percent you look at zoom is down 78 when you see those things that were obviously mispriced uh rivian uh which we talked about i wouldn't use the term miss price they were priced i would say they're re-priced they were mispriced they're not and someone said represent sold them for something they were priced against three birds yesterday they paid 25 more and then today they're paying 25 percent less what difference does it make whether it's yesterday an hour ago or a year ago every day pricing changes well no here's the thing about the pricing the pricing was based on people with a lot of money placing a lot of bets uh maybe whoever okay fine what's the point the market condition changed uh well i think maybe we had enthusiastic people betting things up without looking at fundamentals is my point i think saks agrees with me here on this so i think i think you're right yeah so now you have market participants who were gambling on like momentum now we're repricing stuff do we think where are we at in this repricing or correct pricing or in the settings we're in the eighth in my opinion i think we're in the eighth inning of of the tech drawdown so got it if you're a high growth tech company you've been smashed for three months in a row as you said jason we're off some stocks are off 80 you know 50 to 80 percent of their highs that's like dot-com era corrections that's crash that's crash if you're if you're uh if you're in other areas like value you've had a pretty good rally if you're in crypto you're just starting to get smoked now if you're in um why is it crypto this is i want your thoughts on this why isn't crypto getting smoked like peloton and zoom is because those people are huddlers or something well crypto i think has slightly different dynamics than than individual stocks like a peloton but i think that you're gonna know something's released for one right you're gonna because like you have to understand what all the all that the market is is who's bidding and who's coming into the market i mean there's still thousands of millions of people from around the world stepping into the crypto markets each day that are putting more money into these markets and that balances out the withdrawals and that's all that crypto is there's no underlying business that you're valuing the peloton release was really bad okay i mean it was very strange yeah they well i think they overcame it was strange it was just like uh we're just gonna basically stop producing anything because all of our inventory will meet our demand for the foreseeable future that's a that's not a good statement if you're supposed to be a high growth okay so if we're seeing 50 to 80 percent sacks baker had a tweet that's a capital allocator yeah the bottom of the market he and it was a phrase something like when we shoot the generals and his comment was the generals are big tech when those things trade down 25 the bottom is in and i think that collectively most people think that uh we're a little bit oversold in all areas except big tech i think big tech is down 10 11 12 when you see this thing really get cracked is when those folks you know trade down another 10 or 15 percent and then i think we're kind of through most of the pain so peloton and zoom were kind of mid-tech i don't know what we call those but i would call them like mid-tech they're obviously not big tech but they're not small either mid-tech gets their asses kicked 50 to 80 percent big tech 15 but if big tech goes down 30 then we start really seeing a bottom and we consider netflix you'll never see that because i think big tech you have to remember is basically the index and in the last 10 or 20 years you've never seen drawdowns more than 15 to 25 you've never seen it and and when you've ever had a 15 to 25 drawdown meaning the market goes off 15 or 25 you have to remember the thing that we have also done over the last 20 years has created so much money on the sidelines always looking for a cheap buying opportunity and so the minute that these things so even you know march of 2020 remember when we started to do this pod and it literally looked like the world was ending yeah the bottom existed for a week yep and then within a week the entire 25 loss in the stock market was wiped out and we were back to normal so that's when i sold okay well let's talk specifically about neff i think it was good that we talked about peloton addict at the lowe's oh my god i did too i remember selling i remember selling slack going this is the dumbest thing but i have no choice because i was how about 15 how about when uber goes to 15 from 45 i was ready to basically curled up in a ball and said i'm not selling but i'm not feeling good right by the way this is why i was saying jason like any comment you made earlier i think you made a comment about um you know what do you do right now to drive or make change in these markets and i'm not sure that at the end of the day the drive or the change is being made as much as the change that's being made is being driven by the market itself there is just so many dynamics at play that it's very difficult to kind of ascertain where things are headed next what's going on and we're all going to sit here and we're all going to speculate we're going to flip a coin it's going to come up heads it's going to come up tails we're going to be right we're going to be wrong it's really difficult to kind of put put our foot down and for any of us to put our foot down and say this is what i think needs to happen and this is what i think should happen or it could happen or will happen half of us will be right half of us will be wrong but man let's take another stock i think it's interesting to talk about this netflix was that seven hundred dollars uh just a couple of months ago it's at 390 today um yeah that's like a real business that you can assess what's going on with the business itself well they think they're not going to grow uh 20 30 percent a year they think they grow eight nine ten percent a year but a a fabulous business right like uh great business incredible is incredible now the time so is this growing coming so much anytime netflix is so saturated it is it has achieved such incredible market share by growing so quickly every year for years and years on end at some point the growth was going to slow down they hit their natural audience i think that's right i think netflix is going to be the best example of consumer surplus at scale and what i mean by that is they have given so much value away for an incredibly small amount of money like if you think about the value you get from netflix as compared to what you would get from comcast and you spend ten bucks a month ten dollars or fifteen dollars for netflix versus a hundred bucks for comcast there was such a huge gap in value um but netflix had to spend so much money to keep people entertained the real question is at what point do they start to sort of like run out of the things that they can do to keep people um engaged and otherwise they jason do what you did which is you have a subscription to hbo max you have a subscription to disney plus yeah i mean the headwinds are everybody gets in the game the only real winner is the consumer yeah and any individual company i think gets gets into a real tough spot and i think what you saw was their earnings release basically said just that disney's doing a great job competing against us hbo max is doing a great job competing against us so we're not sure what the incremental dollar that we can give you the growth that we've given you before when we had no competition and that's by the way lena's lena khan's comment which is the other side of the coin which is when you have more competition the consumer does win it contains prices it just doesn't contain asset inflation which does impact the shareholders of these companies uh yeah and still even at this level 172 billion dollars they have a 35 xp one way that to look at this here i think your point is an interesting one chamoth where you talk about how much value they've given away over the years and what they have today you can always look at the balance sheet of a business a public company and in the balance sheet there's this um this line goodwill um no well not even goodwill just the um uh the accumulated loss um uh the accumulated deficit and if you look at that um on netflix they basically run the business right now at as of their last earnings statement which was december 31st negative 40 million dollars so in terms of the total net cash that they've generated as a business since their founding as a business they've lost 40 million dollars so you know and meanwhile the question is okay what's the you know so they're not necessarily uh at a stage where they've been generating cash but for many many years amazon had a similar strategy where they were reinvesting all their capital and that capital was going into building the business and growing the platform and adding the next layer of growth the question is has netflix from a fundamental business perspective not a valuation perspective have they added enough growth platforms into the business have they grow found enough other products services or ways to build things throughout the world everyone has linear video they don't have gaming they don't have anything else right they did start doing sports comedy really they they are dabbling they dabbled with doing a couple of podcasts they dabbled doing a couple of games and there's rumors that they might try to get the other 20 or 30 percent of people who don't pay by creating a lighter version that was ad supported in other words you're not going to get the new season of ozark but maybe you can get the first two or three uh you're a year behind the production schedule but you can watch it all with ads so why isn't netflix in video games and sports it's such an obvious one and that's why i think they released a series of games based on their ip so as their ip grows and i think that's what you'll see with disney plus is think about an app store inside of disney plus a merch store inside of disney plus i think there's so many verticals next to them why is there no merch stories why don't they own spotify or have a spotify competitor well i think spotify sees themselves as a that's a really good point you know when you look at the peloton i was looking at the peloton um earnings when you know this it was down 25 yesterday or the day before and i was like this is an incredible business because they have 2.1 million subscribers that hey 40 bucks a month it's incredible i mean it's a money printing machine money printing machine i actually have a subscription i don't even have a peloton peloton i don't have anything you just pay 500 a year to use the classes i have the app it's crazy i don't even use the app but i think that's 20 bucks for the just that app yeah but the point i was trying to make is when you look at it you know there's about 30 percent of that revenue that goes right back to the music labels for the music so you know to your point like uh there's just an enormous value in actually music you know so yeah one of the great flicks built library values and content they could be they could point it to music as well there's all these things they could do to reignite growth a lot of people discount the value of having a subscription consumer business when you have a consumer's credit card on file and they're paying every month for something it's an incredible point because you don't have the friction of getting the sale done you've already done the sale yep now the question is can you upsell them some new service or some new addition that they're not paying for today so obvious yeah it's so obvious right and so like by the way i'll say this like for years google struggled with this question which is what is google's consumer subscription business because google did not have consumer credit cards across its platform despite a billion daily users and so google for yours was strategically trying to figure out what business can or should we be in to have a subscription model with consumers because once you have that then you can charge for all sorts of stuff you can charge for storing photos you can charge for accessing audio you can charge for accessing unlimited imagine i'll be the i'll take the contrarian side of this okay here we go yeah go ahead go ahead peter j well no look i i invest in b2b subscription businesses i hate b2c subscription businesses and the reason is just the churn rates what we see when we look at bc subscription businesses is five percent monthly churn is not uncommon it's pretty much the standard so call that 50 60 percent churn in the subscription base every year so effectively you're rebuilding the company from scratch every two years i don't see like how you can build a successful business i'll tell you why you're wrong doing contrast that to b2b with b2b subscription businesses you do lose some customers but the ones who stick with you keep adding seats for more employees usually and so actually your landing expands your courts actually your cohorts are growing 20 every year instead of shrinking 50 now obviously there are some of these b2c subscription businesses like netflix and peloton they are obviously valuable they've defied gravity well netflix has done it because they spend billions of dollars on content and peloton's got it because they plop a expensive machine in your house so you can't forget about it and that keeps you a little bit more recurring than like a lot of these subscriptions which are just very easy to cancel but so look they've been able to make it work but i'm most excited here's why i think you're wrong it turns out these are so low priced these subscriptions that you get a lot of consumers trialing them so because it's only five or ten bucks a month to use something like a spotify or a disney um because they're so low priced you do get a little bit of uh sampling and that's why the rate's higher whereas in business there is a massive onboarding of people have to take their time to set up the software learn how to use it so if you're going to commit to it it does reduce it and you do have land and expand but what we're talking about with product expansion is the equivalent in sas of land and expand so imagine if disney plus or spotify after you listen to an album or it's in your top rotation they showed you the merch for that band or after you completed the season of mandalorian or book of boba fett they showed you the merchandise and said here's a limited edition of um grogu baby yoda when that we tried to get baby yoda stuff last christmas disney dropped the ball they didn't have any uh and they could have had all that made and they would have sold millions of we were buying stuff on etsy the reason baby yoda works is because it's leveraged off a platform this massive disney platform of which this b2c subscription service is just one piece i mean look obviously there are valuable consumer subscription businesses so the way i'm approaching it can't be right in all cases however i think people really get themselves in trouble when they start to value these b2c subscription businesses the same as the b2b ones in one case you in the b2c case churn is the predominant characteristic and it means that you have to spend more on marketing or cogs or content or what have you to keep rebuilding the user base whereas in the b2b context the user base is compounding on its own and that'll that just makes for i think a more finally attractive business option yes but it grows slower again just at the end of the day these are all variables just the weights just changed i agree with david that consumer churn businesses or consumer businesses have much higher churn than enterprise and enterprises have negative churn which means that they just naturally grow but the reality is consumers just have an unbounded tam that enterprises do not and the way that the way that the ltvs work uh just tend to be different and the cash flow cycle of these companies tend to be very different and that's why you see netflix get these enormous valuations that enterprise subscription businesses do not what some people are now doing when they look at consume in consumer businesses and look at churn is they take out the ones that are based on credit card to look at like people who actually unsubscribe because they don't want it but not because their credit cards so basically so if you think about like netflix's business if it's turning two and a half percent per month let's call that 30 percent of the user base is a trading every year they've got to rebuild their user base from scratch every three or four years now they can do that um i guess at some point though they may run out of you know greenfield opportunity to grow their customer base um but you know it's gonna pressurize their margins because they're gonna have to constantly spend on content original content to retain you that you have to spend on marketing to keep going after the portion you're you're leaving out the archive these archives are going to be super valuable and i don't think we even know how to value these archives yet because if you look at the marvel archive or the star wars archive these things just keep printing money year after year and then you'll see netflix and hbo max will keep being able to go back to them hbo max being the canonical example now because you didn't think that that business would have you know a lot of ip to build on but suddenly you have the many saints of newark um and the uh sex and the city reboot i mean they're going right down the line there's going to be an entourage when you own a franchise it has value disney has shown that you own the best franchises hbo max is now showing it and then that means netflix will show it next yeah but how much of a netflix's content do they even own are they licensed no now it's 100 netflix is 100 they stopped and that's why disney started taking it off their whole spend that i think they're spending 20 billion or something it's all on original content so that that's why they made that move is because they knew they were going to have the disney content the marvel content pulled where do we want to go next guys big world play because i have coveted uh i want to i want i want sax to talk to me about his what's going on with fouchy oh my gosh this is quite a story this really is um i'm trying to get my head around the story and i'd be totally honest and explain it to us because i think we'll please my head what's going on okay so um a series of emails have come out that were requested of the freedom of information act and what they show is that at the nih um fauci and francis collins who was ahead of it they had a series of conversations with scientists around january sorry january 31st or february 1st there are emails on february 1st summarizing those conversations and basically what they say is that a group of scientists advise falchi and collins that covet likely came from a lab how they know because it had you know hallmark signatures like the furion sites the same reasons we now believe uh the the virus came from a lab okay but by february 4th officials at so three days later officials at the nih including falchi had come to the conclusion that the virus must have been passed zoonotically from an animal like a pangolin it didn't come from the lab and furthermore they were starting to use language like conspiracy theory to discredit the the lab leak the lab leak idea so that within a few days they were all in on this sort of so-called zoonotic theory and they really began a campaign in the words of collins a devastating takedown of scientists who are trying to discuss the lab leak theory that became the official position why well okay so this is where it gets really interesting um obviously i can't speculate to modis but here's what we know the nih falchi's division years ago there was a debate in the scientific community about how we study viruses vouchers an epidemiologist he wants to study them makes sense the debate is over whether you should enhance the viruses as a way to study them so-called gain of function research their faulcy is on the side of engaging in that kind of research there are other scientists who think it's crazy they lose the nih then makes grants to a group called the eco health alliance it's run by uh a british scientist named peter dazing okay by the way who doesn't who doesn't support eco health and an alliance branding yes exactly so so eco health alliance which is has neither been good for the ecology for our health or uh online alliances yeah keeping up bad natural alliances everywhere yes so they then provide funding to the wuhan institute of virology to study bat viruses where you know function research then occurs this lab in wuhan is known to have had leaks in the past so just from a security choice not the best recipient of a grant but that is what happens okay and then we know the history from there it's almost certain that what's the what's the element of the story that has to deal with the lancet and the yes person that worked for fouchy and then uh and then that person got a grant afterwards what well and then just one other thing i want to point out here um so we're clear this has become a very partisan issue but the original foams were done by buzzfeed and the washington post sorry the foia releases were done by buzzfeed and washington post and now you have rand paul on the other side of it who seems like really wacky and obviously conspiracy right-wing so you have this like really weird partisanship that's now been embedded in it okay yes so can you explain the partisan nature and then question i almost want to take uh chamas question first about who's this dazed guy what is this lanceletta let me come back to the parts and think i'm just going to try to establish the facts before we get into the partisan mess of this thing so peter dazek is the guy who made these grants to the wounds of virology okay there is one other interesting fact when the west wanted to come in and investigate what happened in this lab china approved one person from the west to come in and conduct the investigation guess who that was peter dazek okay he was the only guy the ccp led in to go look at this lab he then comes out of this whatever he did and says it has to be the zoonotic theory he endorsed the wet market idea it cannot be lab leak that is a conspiracy theory and then he rounds up a group of scientists to write a letter to the lancet which is a respected scientific publication which is incredibly respected yes which he signs in which he basically advocates the zoonotic theory but he goes further and says there is no way that it could be lab leak and anyone who says as a conspiracy theorist and that has an incredibly chilling effect on the scientific community because no scientist wants to be labeled a kook or conspiracy theory or heretical to the lancet exactly and this is a tight-knit ecosystem of um of insiders insiders and institutions and grants no scientist wants to lose their funding right and then furthermore big tech starts censoring his disinformation the lab leak theory because they say well these officials look at all the scientists we have to follow the science right so the science according to this letter from the lancet is basically on the side of the zoonotic theory so you then have downstream censorship of this so that is who peter dazuk is and and and in this letter in the lancet he never disclosed his conflict of interest which is the fact that he funded this wuhan institute of irology to conduct the type of research that might have led to the leak of the virus so this guy is hopelessly conflicted and has a reason to want to suppress and cover up a lab leaking never disclosed it and look so does fouchy i mean because fauci funded dazzac so imagine when in february of 2020 when the lab leak is coming across the desk of fauci does he tell the president mr president he's at the right hand of the president mr president we might have funded this thing we funded dasic who funded the wuhan lab we collectively the united states government might have some responsibility in this do you think that conversation ever took place when he was making his recommendations he was hopelessly conflicted and if the truth about this had come out and look i'm not saying he had any intentional role i'm not saying he wanted this to happen i'm not even saying that he knew for sure that dasic was funding the wuhan lab okay let's just give fauci the benefit of the doubt but we all know how politics works if it had come out in february of 2020 that fauci had funded the guy who funded the wuhan lab and that's where the virus likely came from his career would have been finished okay finished we know that as a political reality and so within days of scientists advising fauci hey this thing probably came from the lab the nih is consolidated around the idea that this is a conspiracy theory and they work to suppress it and they wage a public campaign i got to tell you when i have learned all these facts i got to tell you what i compare it to it's almost like we learned all those revelations about bill cosby that here's this guy on tv for years pretending to be america's dad and then we find out he's a monster fauci has been on tv for years lecturing us about covet he's been like america's dad america's doctor and lo and behold we find out that he has a role in this whole thing and look i'm not saying his intent was not to uh of course it wasn't anybody's intent has been used to help people so it's a little bit of a part i'm going to give him the benefit of every doubt here i'm going to give him the benefit of every doubt okay he's called him bill cosby i'm going to give him the benefit of the doubt in the sense that he didn't want this to happen he didn't have any he didn't cause that but we know for a fact that he funded dazak who funded this lab it's where the virus came from come on we know that and he covered it up he engaged in a campaign okay we suppressed the lab leak theory that is a conflict of interest let's get let's get freebie in on the science what do you think as some a man of science freedberg the sultan of science in fact about uh these emails and the chances that fauci essentially was funding gain of research and then attempting to cover it up which is the accusation that's a question of science look there um i mentioned this in the past jamie science community you know amy metzel did a um a podcast interview with lex friedman it's worth listening to uh it's a couple hours long if you've got some time to kill um but he does a good job contextualizing these matters and what may have gone on that led ultimately to um the the lab leak and also the lab leak cover-up i don't know what happened with fatching emails i have not read this stuff um so i i you know i have no reason to believe that thatchy is malintentioned in the sense that he has some reason to harm or hurt um i could see that there is a certain degree of nervousness to accuse the biggest foreign government and potential u.s adversary of causing a global pandemic and not wanting that sort of conflict to arise at a period of time when you really need to take care of your people and we really need to focus internally as a country on how do we get through this pandemic and making that response to that no i have to respond to that i'm not saying that fauci or anyone involved in that process should have accused china but that's not what was their decision that what was not was made they decided to stop the debate altogether they decided to suppress the debate what would you have done in that seat sex you're sitting in that seat and the country is potentially facing a pandemic that could wipe out millions of americans where do you prioritize it i'll tell you what if i was sitting at the nih and i wasn't hopelessly conflicted i would probably have just said listen i don't know what the origin of the virus is let that debate continue i would not have tried to wage a public campaign against the people against the scientists who were honestly pursuing in good faith where this virus might have come from so we can learn things maybe how to avoid something like this from happening again the people at the nih should not have engaged in that type of politically minded pr campaign they just shouldn't that's not their job as scientists and then to find out that they have a conflict of interest on top of that that might be motivating that desire that is not that's not appropriate i i think it's really important freeburg you can probably agree with this that at some point some journalist should really simplify this for all of us because it's it's a it's an incredibly important topic that we need to look at at the end of all of this assuming that omicron is the end of this chapter because it's been a horrible chapter for the world um but we do need an accounting of the truth right i think that that's really important there was an episode many ago when i said i don't know and i don't care about whether or not the virus came out of china and um again i was somewhat kind of misstated as the intention of why i said that the reason i said that and what i really meant was that what happened even if it was a lab leak what happened was really the tip of the iceberg the ability to bio engineer pathogenic organisms is becoming ubiquitous the toolkit to do gain a function research as it's being called in the press is a very simple toolkit the ability to engineer organisms that can cause catastrophic harm to the human species is becoming available on the internet and with tools that any of us can buy and use in our garage and so what i'm more questioning and what i'm more concerned about and what i care more about is what is our global biodefense strategy how are we getting ahead of the next wave of this happening and it's not about the who said he said she said those things it's really important to understand we need biodefense when they're saying it came zoonotically they're saying it came from an animal when it actually was created in the lab if you want to have biodefense we got to first say that again whether or not yeah you're right whether it did a separate question to me whether it did or didn't the tooling to do this is absolutely possible and the ability for these sorts of viruses to leak out and be made and turned into a weapon is significant it's a real risk and so i'm for you guys i think both of you guys just figuring out how do we solve this problem like how do we get right but both of you guys are saying nuanced versions of david is saying we have to have an honest accounting of what happened if we could if we're supposed to actually have an eco-health alliance yeah i'm not by the way i'm not i'm not you're i'm not you're saying yeah i'm not just making i'm not dismissing that yeah and you're saying we need to actually formalize gain of function research because everybody has it and so it's going to be inappropriate for us to ignore it we need to assume game of the function research leads to dangerous pathogenic bio-organisms and then we need to formula it doesn't and then we need to formulate a biodefense strategy i'm just saying like we don't the implication the reason why saxis thing is important to me is the implications we have to have an honest accounting of these implications we saw another implication just this week in flint michigan they shut down indefinitely the public school system in flint michigan okay this is a society just to give you a sense of the facts here 90 percent are minority because of the fear uh of of catching covet and spreading covet uh but and 90 are minority kids 80 are in poverty i don't know how you know 80 of kids who are in poverty are expected to have a laptop and internet access on a consistent basis this is the same place that screwed up the water system so uh i don't i so i think like we have to have an honest accounting of um of all of these things because the implications are real this is the biggest story of our lifetimes kovid i mean it might be the biggest international incident since world war ii and the fact that the major let's call it prestige publications have not really fully invested hold on conundrum to me because this started with um a massive amount of coverage from buzzfeed washington post new york times in june of last year 2021 they were covering this like crazy vanity fair did a major investigation and then it seems to have gone silent and then rand paul has been going after this and it all of a sudden became partisan so the only coverage i'm seeing of it is that's independent is the intercept but then everything else is the hill and you know really weird far right stuff that wanna like you know fauci needs to be whatever and how did it become so partisan if it started with left-leaning publications getting this information sacks like how did this become partisan is because the president changed in the middle of all this like what uh do you have an honest handicapping of why we can't get you know like a consensus on what's actually happening here from the press is it rand paul's too polarizing well i think what happened is if you go back to february of 2020 if you look i just had this conversation with ashley rinsberg on my call-in show and you know he's not unplugged now available call it can i he he he literally wrote the book on the new york times and i asked him about their coverage of problem this is the guy who literally this is the guy who literally wrote the book on uh the new york times and i asked him about the new york times coverage of of coven and covet origins he says that on february 17th so basically two weeks after these officials at the nih settle on the conspiracy theory narrative that that narrative is then published almost word for word verbatim using the same language not just the new york times in the washington post across all these major publications so what you see there is a pr campaign it's a concerted effort you don't get the same words and language being used across all the major publications at the same time unless somebody is pushing that narrative we all know this this is corporations do this right they run pr campaigns that is what basically happened and so the prestige media got on board this zoonotic theory and this idea look like they've done so many times they got on board wmd in iraq before realizing it was a total farce and a hoax okay they so they got themselves on record behind this conspiracy theory idea and similarly i think the democrats got themselves on record as being pro falci and everything because of you know tds right anyone who's standing up to trump must be correct and defend it and so all of this happened in 2020 and so by the time we now fast forward to let's call it an honest investigation of the origins of the virus which should be bipartisan this should not be partisan we should all want to know what happened we should all want to take the politics out of it because without knowing what happened how do we prepare for it in the future everyone's already like hopelessly committed to positions they took in 2020 and i think this was driving the partisanship yeah i think you're right yeah i mean that's the thing i'm trying to get to is like when i saw you wanted to put it on the docket i'm like trying to grok this and i can't find i'm finding all the left-leaning coverage from june of 2021 none since then and then it's all right coverage now and i think it's something we need to get some independent coverage with so i'll take credit i'll take credit for saying fauci is the biggest political loser at our all-in uh podcast recap thank you i'll take my bow now well i mean and the the other thing that's kind of the way half of our refrigerations have come true already i mean right now we're so correct on these things um the thing that's i think just infuriating right now is that everybody is trying to manipulate the public and they have not understood that in this media environment the truth comes out kind of not only eventually but pretty quickly so stop trying to game the public either way that the vaccines don't work they've delayed the public reckoning on this by what like two years well here's the thing there's a so i agree with you on that there's also a forward release that happened in the uk where and it's a little too much to get into right now but this photo release now is looking at all the people who died in the uk of covid uh and it turns out like maybe more people are dying because they didn't get their cancer or a large number of people died because they didn't go in to get tested for cancer and all of this is going to come out eventually and not putting out every day the ages um and the comorbidities of people who died of kovid just led to this feeling that we're getting gamed and turning on cnn and seeing the case counts in a cumulative chart is like a startup giving me like the cumulative number of people who registered for their company but for their product we don't care about that we want to know your daily active users what about what about the catastrophic impact of school closures that we've been talking about on the show repeatedly you know everything's being manipulated stop manipulating the public look you have to realize that there is huge political motivations here because huge cya going on because the heads of the teachers union said there is no learning loss they are the ones who lobby to shut the schools down they sure as hell aren't going to admit their mistake now they're covering it up and so any politician who takes their money is basically they're going to muffle their criticism there's only one really honest like left-wing guy i've seen acknowledge the school closure issue which was jonathan chait had a great article in new york magazine saying that progressives must acknowledge the mistake of school closures because otherwise we can't learn from it he has been a voice in the wilderness on that side of the aisle we got to wrap up now that uh sax has cracked open the plugs uh what are we all working on because i want to give a plug to friedberg who uh did a great interview uh on a tech podcast called this week in startups where he announced tana so it's a dual plug here uh friday's episode of this week's startups uh maybe you could tell us a little bit about the launch of of canada your new uh yeah we're applicator we're just announcing the business um which i talk about a lot on jason's pod so definitely worth hearing but as you guys know i've talked a lot about this concept of decentralized manufacturing where we can kind of move old-school industrial production systems which are super inefficient we use lots of resources move stuff into factories process them and then ship the products back out and um you know technology now allows us to have more distributed or decentralized manufacturing um potentially so what you know what we've been working on for three years at this point is a company called canna which is really about you know printing beverages in your home so you can use a single device to print uh iced coffee or iced tea cocktail juice wine soda etc um all using a single flavoring system and water from your from your sink we talked more about it on the pod but i think this is a big theme you know forget about canada for a second but generally like the systems of old like you know the industrial revolution created all these old school systems that are big contributors to carbon emissions and are super resource inefficient and i do think that everything from 3d printing to biomanufacturing to the system that we kind of introduced today with canna can completely reinvent our global industries in different ways um and ultimately lead to cheaper products better products and products that use much less natural resources and put less carbon out um and so it's been a big thing that we've been working on i'm excited to kind of open it up a little bit and talk more about what we're doing so um thanks for having me on did you hire the mute uh as a spokesperson he may or may not have his brand on here we'll see there so right now the business is um uh is signing up lots of different folks that can create digital beverage brands and so if any of you guys want to have jake house you know our cider hard cider um here we go we'll uh we'll be launching that but yeah and actually told me his his new um his new soda that he's going to be bringing it's called muth cola it has five times the sugar of coca-cola other than that it's just like any other colder but you get five times the calories it rips out like maple syrup uh hey i'd like to i'd like to do uh you gotta um in genesee county in michigan flint indefinitely shut down their public schools this week what is going on you have thousands of kids um who at best will have to learn via zoom and internet access that most of these kids may or may not have because again uh you know they're they're in poverty and and so i just want to make sure that everybody just understands that everybody tweet that and self-inflicted wounds well here's the thing these kids um this is one of eric adams 90 90 minority 80 in poverty um all virtual until further notice well here's what's going to happen it goes right against the cdc guidelines okay and uh this is really the accounting of the cost and we are as we said before learning loss in our kids is going to be the single biggest thing we look back in 20 years coming out of this pandemic and realize was the the the biggest price we paid for this so and here's the stupidity of it the what the eric adams and the new york city uh you know sort of uh leadership we're talking about this when these kids are in school okay there's a chance they're gonna get omicron like everybody got omicron like everybody has it now like it's crazy how many people in our circle have it the only person doesn't have is phil hellmuth now um what's gonna happen when they go home or they're not in school and they're hanging out with their friends or looking for something they're going to get it anyway what eric adams said is that school is the safest place for them to be yes totally and school shutdowns are just so insane to me right now unicef had an article which i'll dig up where they said that the cost in future earnings by this generation of students who suffered learning loss is going to be 17 trillion worldwide uh that's going to be the economic impact from this thing not to mention the stunt individual and emotional development yeah by locking these kids down for years anxiety ptsd i mean this is going to create depression in kids we need to solve this we got it we got to get the we got to get the schools and flint open all right everybody for the dictator chemo polly hoppetea david friedberg the sultan of science and the rain man himself david sacks i'm jay cal we'll see you next time love you [Music] we open source besties to the fans and they've just gone crazy [Music] we should all just get a room and just have one big huge orgy because they're all just it's like this like sexual tension but they just need to release [Music] your feet [Music] i'm going home [Music]








we don't want to talk about andrew i think that guy palmer lucky is super fascinating the oculus why do you want to talk about that company because i think he's launching a syndicate soon no why are you an investor lucky hates me he won't come on this week in startups literally what did you call him parma lucky palmer lucky cosplay palmer he's a cosplayer i like the fact that he does what is that that's when you dress up as comic book earth like superhero characters and go to conventions you know how you dress up in the clothes of old italian women he dresses up like a in italy there's like a culture like in the in the olden days like it's like you used to have these things called salati which basically meant like all the decisions of the country were made by these people in the living rooms after dinner and you know the the most powerful people in the salati were uh these women who were married to these men and they would be the architects of all these diseases and he would never finish the pasta he always leave with so much on the plate and people and people would call them matronas right so i'd probably be a matron i've always felt you were like the old italian lady in our groups [Music] [Music] hey everybody welcome to another episode of the all in podcast yes we're still publishing yes we haven't been cancelled but it's early in the show so you never know uh with me again the dictator himself chamoth the sultan of science david friedberg whatever beverage you like he'll make it for you right now in his replicator and of course yeah the rain man himself yeah definitely going to win the midterms yeah david sacks everybody have a great week getting their asses kicked in the market i'm pretty good you're okay everybody okay nobody look i can't look at my portfolio anymore i just stopped checking it i uh not a fan of the color red i actually um i i've been using this period to kind of desensitize myself um i went back and i started to think about like all of the sort of errors of commission that i've done in like the last decade and i i was able to look at like four or five specific trading moments where i was like wow what did i do that for and i came away with two things one was if i confuse an investment with a trade i'm done for meaning like there are things that you invest in that you just want to own forever and then there are things that are trades that are just speculative and you know at the end of the day you have a sense that it could be up in the short term if i confuse those two i've made huge mistakes and then the other one is i would always get really emotional and panic at the lows and so i was like you know in early december or november when i wrote that letter on twitter and we talked about it and i sold a bunch of stuff after jeff and and elon were selling raised some cash and i was like okay now i have enough buffer here the whole point from here on out is to basically like insulate myself from my own emotional turmoil stocks go down and so far so good and my litmus test is when i go home uh at the end of every day you know i check in with nat and i'm like am i an [ __ ] because if i when i guess what does that have to do with investing when i get crushed in the market i tend to i tend to take it out of my friends and my loved ones obviously because we're your friends we come to your poker game when your socks are down and you're just like oh my god i brought it once that's it i'm popping the glides up i can't take it anymore do you remember last year jamal during the the market collapse uh when at the start of kovit and you decided you didn't care about having nice jeans anymore and then you fast forward to december and you were proclaiming the virtue of a five thousand dollar fresh alpaca sweater or whatever i think i think another another indicator of sentiment in the market for you is your clothing uh oh my god uh choice but this is a this is a really nice cashmere ribbed sweater from loropiana okay well we're back in the games it's good to see we're back to normal now yeah let me ask you then i'm going to put a couple of uh items out there is bitcoin a trade for you or an investment for you or was it and is it now well i invested it in 2011 at 80 dollars yeah yum yum i wrote an op-ed in that same year in bloomberg which i hope at some point they take off the paywall yeah and the whole thing was you should have one percent of your net worth in this thing yeah it's remained an investment ever since so still an investment yeah i've structured it so that i don't hold any bitcoin personally myself because i don't want to have the pressure and the risk of keys and coins and wallets and this and that but i still really believe in bitcoin in the long term got it sex how do you how how do you deal with the emotional turmoil of opening up your stocks crypto whatever wallet and seeing red and then going to work every day or you just curled up in a ball playing chess with peter taylor yeah i mean you just gotta try and ignore it okay try was a key word in that sentence it doesn't really affect me that much i mean so i run the avoidance acceptance function i have removed my emotions no look there are there are countervailing benefits so when exit prices are great entry prices are lousy and when when entry prices are great exit prices are lousy so there's an inverse relationship so in other words all the the companies that i mean the public markets have massively corrected and though and now finally you know we talked about this few few months ago those new price levels have trickled their way down into venture markets and so finally you know venture deals are starting to price at more reasonable prices so in terms of harvesting gains from old investments um obviously it's not as attractive as it was three months ago but in terms of making new investments is much more attractive and for a relatively young venture firm which is what we are you know we yes we do have some investments that are kind of in the harvesting stage but you know we're only a four or five-year-old firm we're still the bulk of our activity is making new investments so you know it's not it's um it's all just kind of part of the game and i'm not really that worried about it said another way fortunes are made in the down market they're collected in the up market is the way i always phrase it but it's true things are going to be on sale right now we saw bill ackman i think uh who i think is a friend of the pod i think he listens yeah super super super smart brilliant yeah and i just i just want to emphasize because i don't want founders to get the wrong idea it's not like we're trying to pull one over on founders and get some sort of sweetheart deal or something like that my view of like our role as vcs is just to be a price taker of whatever prices the market sets we don't try and negotiate something better than market really we just take the market price and we pick the companies we want to be in so that's our job is really just to pick not really to negotiate that much you're not you're not able to haggle it's not like you can go yeah exactly the market's super marketers like oh bananas are a dollar a pound i'll take them for 50 cents they're like oh sir this is a whole foods we don't negotiate breakfast right so we're we're a price taker in in good markets or bad markets and um it's just that i think that the prices now are coming down because what i've heard is that the crossover investors like tiger like co2 who are deploying all this money they've really uh slowed down now i think they're all kind of licking their wounds and so like all this money that was flooding into the venture space is kind of on pause right now and that's caused the price levels to drop the end of last year in q4 my public portfolio really started to turn over took a huge amount of losses going into the end of the year and then i took an accounting obviously of like the entire book and uh the public portfolio every single thing that i owned ultimately basically broke even last year some were up i made some early sales some were way down by the end of the year net net i kind of broke even but my private book was up a billion dollars and i told the team i'm like uh no this is not real so we have to take those marks because you know you have other venture firms that are pricing these deals and we get audited k-1s and so we have to take the up billion but i told them you should consider this that we had basically a down you know so net net our returns were like you know we were up like 15 and i said this is not real we were at at best break even and probably we lost money but you can't you can't not take these marks because like you know you have an entire fund complex that lives on these marks yeah it doesn't affect my compensation at all but i have to take it freeberg then sex good for you that's a really important point because i think we talked about this one or two episodes ago um but there's a significant disincentive for venture firms to take markdowns to raise capital into a private business at a price that's lower than the prior round because when they do that the the marked value of their portfolio goes down and then it makes it harder for that venture firm to go out and raise the next fund that they're going to try and raise from their lps because it looks like they're not good investors and the reality is and so in every round as everyone on this pod knows there's always an incentive and a push to see can you get the valuation higher even if the business performance didn't meet the objectives of the prior round and things have gone sideways a bit doesn't necessarily mean that it's a bad business but it doesn't necessarily mean that it should always be getting an uproad just because it's being kept alive and there's this artificial um pressure in private uh equity uh in venture to always drive the value up or to run away from the company because otherwise you're gonna have this markdown and you don't wanna be putting money in a markdown that looks like a loser and so on and if you look at the public markets every successful company has had significant downturns in their stock for um significant periods of time from facebook to facebook to amazon to netflix and all of those businesses were sound businesses it's just that for whatever reason there were perturbations and markets perturbations in the business but the long-term value creation was still there and so i think we need to kind of you know be really thoughtful you know and and entrepreneurs should be very thoughtful not to give in uh to the venture mandate to always drive value up but to be really thoughtful about getting the right valuation for your business and getting the capital you need with the right partners can i say something about this it's so important what you said one of the tactics that i started three years ago was i run my own shadow portfolio where i don't take the marks and i just keep them at my cost basis and i'm not allowed to use that for anything i don't you know i can't use that obviously i would never use that for compensation with my team or anything else but i use it in my own head to say okay if i invested a dollar let's not think about what somebody else may think about what that dollar is worth let's just keep it at a dollar unless it's impaired but i don't take the markups and i look at my portfolio that way but it's a very difficult thing to do and the reason i do that is because i don't have the pressure to raise incremental funds but if i did i wouldn't be able to play that game and i'd be very focused on making sure other vcs marked up my deals because to your point it takes 10 12 years to drive liquidity literally that's the key here and so what are you supposed to do if you're a venture business in year three or four except raise money on markups paper markups are the they're the they're that's the lifeblood of what events industry going yeah totally well i mean the interesting thing for me is i lp a couple of these small like emerging fund managers you know microfunds 10 million or so 3 million and they were sending like a lot of updates and so i'm in some top-tier venture firms that some of you are in and they send you an audit every year and they send you a distribution cash on cash here's where you're at and then i was getting like quarterly emails as everything was going up these new fund managers are like we're at 100 irr we're at 200 irr because this crypto investment we did got marked up and i was just thinking about what bill gurley would always say which i think is a howard mark's quote you can't eat irr like what are we doing here like why is there such a focus on this is because you want to raise your next fund and then the other game people were playing was and i got into this um because people were like oh you know you're grossly undervaluing your uh funds because robinhood is trading at 30 a share on the private markets com is trading at this in the private markets and the second people were using secondary market transactions as their mark so i'm curious sax how do you think about if you invested in a company the series b was a hundred dollars a share but then somebody bought it at 150 a share in the private markets where do you like to mark that in your funds or how do you think about that in getting ahead of your skis in terms of valuing your private funds well to the most points we have accounting rules around this so we can't like subjectively decide like what mark to set for each company for you know obvious reasons our lp's want like a predictable accounting so the way it generally works is that you the mark is set by the most recent private you know financing this is the way it works and if people want to discount it from there they certainly can you know what about a secondary transaction is there any more complicated rules around that because it's a different class of stock so um it's some combination of sometimes we use a 49a sometimes it's the latest preferred round it's um you know it just uh there's like complicated rules around it by the way i'll just to rehash what was already said and just to say it one more time chemoth pointed out that it typically takes 12 years to liquidity from the time a startup is initially funded to the time that you sell it or go public show me one public company that has had 12 years of cons consistent gain in its stock price it doesn't exist and so again like this this notion that you know every startup is seeing some perpetual persistent increase in value uh is an artifice that um doesn't really represent it doesn't it doesn't exist in tech and that's that's a feature not a bug right meaning the things that can go up predictably for 10 to 12 years are not necessarily businesses disruptive they don't take risk they're not dynamic no they don't take risks yeah saks can you define perturbation for the audience i heard freiburg say that a couple of times perturbation would be perturbation changes what like volatility basically yeah rapid change anxiety mental uneasiness okay a cause of anxiety or uneasiness okay i got it i thought you were saying another word you don't use the word perturbation i i thought you said another word what word was speaking of markets we were on a text on our text thread talking about if we're about to have the uh start of world war iii and then maybe this is not in the news now how do we look at the uk russia situation in the ukraine obviously 100 000 troops are amassing on a border and what is the goal here um because biden is saying hey listen if anything happens we're going to go to war and there's a lot of saber rattling here i don't exactly understand what putin's goal or motivation is and that's i think what i'm not hearing in the news is exactly what is his goal what what are your thoughts on what's happening in uh the ukraine and russia uh sects okay well i think first of all we have to kind of level said in historical terms about how unusual and unprecedented it would be for us to send troops to fight you know potentially russia in a border conflict with ukraine which and by the way the bind put 8 500 troops on alert for deployment this week it's really without historical precedent uh during the cold war you know in 1956 soviet tanks rolled into hungary to crush rebels air eisenhower did nothing 1968 soviet tanks rolled into czech slovakia to crush the frog spring lbj did nothing 1981 the soviets crushed the solidarity movement in poland ronald reagan did nothing even though he had campaigned on getting tough with the soviets and then more recently in 2008 when russia invaded uh georgia george w bush did not intervene militarily and in 2014 when putin occupied crimea obama did nothing and so this idea and the reason for that in all those cases is because america has a vital national interest in avoiding war with a nuclear-armed russia and we did not have a vital national interest in defending the territorial sovereignty of those nations that's the bottom line and so for us to be now beating the drums of war and talking about sending troops into a war zone with russia is just it's unbelievably friedberg uh one might speculate uh if they were cynical some sort of wag the dog situation here biden's not doing well he's lowest popularity ever midterms are coming up is there any political motivation here do you think and what biden's actions are you know given the context of what saks just outlined i i think that there's um this is like showing up to the you know the last 20 minutes of a two-hour movie and then saying oh my gosh what's this guy doing he's so crazy there's a long narrative that precedes the current news cycle on what's happening with putin and the ukraine you know in large part the united states helped to start the fuel um the expansion of nato in the 90s and the intention was to make nato as a western allied kind of organization contain russia step up right to their borders get very close and and ultimately make these kind of you know areas free liberal democracies that are aligned with the west and put them right on russia's border and and that is obviously antagonistic if anyone tried to do that to the united states like russia did with the cuban missile crisis we would view that as a hostile act and we would react accordingly and for years the pressure has been building and has been mounting as putin has started to kind of solidify uh his political power at home and his allies abroad in trying to figure out ways to push back on this wall that has been built around him and his nation and you know to some degree i think we look at this as like his aggressive behavior but to some extent it is a defensive behavior over a very longer cycle when when viewed that way and again like remember the us had this monroe doctrine um which president monroe put in place in i don't know 18 1800 something that said you know anyone that comes into our territory and tries to influence nations around us to be hostile towards us is is a hostile act in and of itself anytime someone tries to influence our politics it's hostile and i think russia viewed our behavior and nato's behavior this way and so his primary demand is and has always been that the ukraine cannot and will not and should not join nato and the u.s response has and continues to be and and the eu and the eu and we're saying look we we believe in the sovereignty of the ukraine and we want the ukraine to make their own decision about where they go and what they do but the reality is for us this is a key part of a very long-term strategy to keep russia contained now meanwhile there's this beautiful backdrop of what's going on with china and if i'm china i would love to see the u.s and russia in conflict because it will weaken the u.s and if i'm russia i would love to see the u.s and china in conflict because it will weaken the u.s the u.s is in a very precarious situation right now and for us to actually end up in conflict it's going to weaken our position with one of these other two emerging you know challenging you know superpowers and this is a a really precarious time i think to sax's point it's highly unlikely we're gonna end up sending military but the posturing is such that we need to kind of hold our line until the very last minute we'll see what happens i did say you know at the end of the year i do think that we're in this kind of economic status right now that if there were an opportunity for conflict we're probably more likely to want to engage in conflict than not because it does create something that we all get behind it creates you know kind of a political unity it creates economic unity it creates driving forces that maybe might help us through what is clearly a very volatile and difficult time at home um so let's see what happens i think obama's already given us the end game i just think we have to go through the machinations to get there he said to the atlantic i think it was in 2016 or 17 he said the fact is that ukraine which is a non-nato country is going to be vulnerable to military domination by russia no matter what we do and you know every time there was this brinksmanship we effectively blinked and rightfully so because it didn't necessarily make sense to to all of a sudden engage the war machine to go to war in eastern europe the thing that's interesting about what happened here though was that this was a slow moving train wreck that was really visible years and years ago why is that well if you look at what was really happening this is really a european issue and you got to think well why is america being the leading actor here when you know where's europe in all of this well it turns out that you know the strongest power in europe germany is in a really difficult situation because they rely on russian energy 50 of uh the nat gas that comes in or 50 of the energy i think that comes into germany is from russia and they've in fact been building an entire pipeline system um from russia that bypasses the ukraine and goes straight to germany and so when all of the saber rattling was happening germany basically had to blink because they need russia's energy and why did they need russia's energy well they needed russia's energy because 20 years ago the environmentalists in germany won and they started to decommission all their nuclear reactors that's so ridiculous there was no so at summer along the way nobody took a science class in germany and figured out that nuclear was both safer and cleaner instead burning fault fuels was the only wiser to not have a dependency and after the fukushima they went turned them all off they accelerated it yeah it made more sense to burn fossil fuels number one and then to get those fossil fuels from russia so unfortunately we are in the state of affairs where you know germany has said at least it's been reported that they would shut down this pipeline nordstrom 2 if uh if russia did something but the reality is i think obama basically told us that you know it's going to be very difficult for us to justify an act like this especially against somebody who is fortified and clever and smart this is not like invading the middle east and so this is a massive if this happens the uh the stock markets will just go absolutely to zero i mean if you could have negative stock prices this may be a good one to take these netflix shares please that's unbelievable it's it's really really crazy this is it seems like a situation where we're assured not to get into to mix it up with him like i i don't understand putin i don't understand biden saying that he's absolutely going to react to this because we're not we can't afford to get into a war right now that's right and if that is true then you know us dominance the u.s ability to hold the line starts to decline and i don't know if i agree with that because um i think we could defuse this crisis very easily yeah which is the exit ramp yeah tell us well the the exit ramp here is what is putin demanding putin is demanding that we affirm that ukraine will not be part of nato in my view in my view that's giving him the sleeves off our vest because we should not want to add ukraine or georgia to nato that would do nothing to enhance the security of the united states we wouldn't get anything out of it but we would be obligated under uh article 5 of exactly to defend them so admitting ukraine or georgia or moldova could ultimately bring us into a war exactly so to free to freeburg's point earlier we have been poking the bear for two decades with our expansion of nato right up to russia's front porch and if you go all the way back to 1990 when george herbert walker bush was president and james baker was secretary of state there was an assurance made by james baker that you know basically they had gone to gorbachev and said we want to you know we for help in reunifying germany and the promise made that famously that james baker said is that what gorbachev said is we don't want nato expansion and baker apparently said not one inch eastward was the line and um and we we think back to how well uh herbert walker bush and james baker manage the end of the cold war how do they do that they they did that by making assurances to russia that we would not bring nato up to the front porch as well which is what we did in 2000 we've now added something like 14 countries in eastern europe to um you know to nato including in 2004 the the baltic countries and that decision by george w bush really is the thing that pretty much severed our relationship with putin you have to remember that putin is he is fairly popular in russia because he stokes russian nationalism and what is the source of that nationalism it is because a single tree organization nato now has this huge contiguous border with russia they now feel encircled and if we were to add ukraine to that organization there'd be a 1200 mile again border which um that russia would have with with just this one this one alliance it would be akin to imagine if we were still in the cold war and canada were added to the warsaw pact right i mean we would be incredibly threatened by that so and so but but you know you never hear jacob you never hear any of this on the news all you hear is the beating of the war drums and putin is portrayed as this mad dictator he has no legitimate concerns now look putin is an authoritarian and you could describe him as a bully and a thug and he has provoked a dictator he has provoked this situation certainly okay but you know we treat him as if he has no valid concerns whatsoever and i think the simplest thing to do to defuse this crisis would simply be to say yes we have no intention of adding ukraine to nato and then we will find out if putin is a liar or not well that would be a great move like it's a that would be like hey let's take a five year pause okay you know what we'll negotiate with you we'll take five years we won't put them in nato give give a little bit of a concession because their country is not doing well their gdp trials china and the united states their gdp per you know uh each citizen is incredibly low compared to the west like and then we could just work with germany to get on sustainables which is what their goal is and we could economically continue to trounce them because as you point out every week chamoth they're not an important economy here's what obama said about putin obama said the truth is actually putin in all of our meetings is scrupulously polite very frank our meetings are very business-like he never keeps me waiting two hours like he does a bunch of these other folks he's constantly interested in being seen as our peer and as working with us because he's not completely stupid he understands that russia's overall position in the world is significantly diminished yeah he's not crazy he's not dumb and by the way nationalism as sax points out which is a a a primary you know drum call for for putin is not a novel sense we we are a nationalist country nationalism is um you know pride and and wanting to make sure that your country is treating with treated with respect and has sovereignty and so i don't think that putin is an irrational actor his behavior is very rational in response to what's gone on for 30 years and his requests are that he is feeling threatened and he's trying to avoid military conflict as much as he can and we portray him as being an aggressor that's demanding military conflict and at the end of the day our behavior over a long period of time as a country has driven us to the brink here and i think saks is right you know the right decision may very well be to to kind of you know leave the region alone and focus on issues that matter more deeply to us and are a higher priority rather than drawing us into this but a better investment would be in sustainable energy i think the economic seed is planted for us to be in some sort of conflict this year so you know we're going to end up explaining what you mean by that freeberg economic seed to be in some sort of conflict i think that you know generally if if you're not going to see homegrown you know economic productivity gains and you're suffering trade issues like we're going to suffer this year given the supply chain problems globally we're going to look for some place to manufacture growth and uh there's no better way to manufacture growth and through um the dog through conflict the foreign policy establishment in washington you know the neocons the you know the so-called washington blob i mean here they are being the drums for war we haven't been in a war for what six months we just got out of afghanistan and now they want us back in another war and and the media just keeps fueling and fermenting this and they don't you know their coverage of it is well it's exactly what we talked about last week jake out when i pointed out that you're your rhetoric your humanitarian rhetoric as noble as the sentiments are when it gets whipped up into a lather in a frenzy by the media it blunders us into a bunch of stupid foreign interventions let's call it beliefs my beliefs are not rhetoric but i i get your point but here we are one week later and exactly what i said the risk of this is has now materialized clearly you're blaming my position on human rights now what i'm saying is that this type of rhetoric is used by the military-industrial complex and the washington blob and the neocons to stampede us into wars that don't make any sense that's what i predicted a week ago that's or that was my concern death that one here we are one week later and we're in exactly that situation it is our most successful export it is our most successful export jkl really important there's a difference between there's a difference between belief and how do you act on that belief and what are your actions based on your belief yeah and i think that a big part of what's gone on and this harkens back to a few episodes ago when we all got in trouble uh or there was an attempt at cancelling us after we spoke about this but but when those beliefs are um sacks pointed out harnessed in a way that um ultimately co-opted in a way to to fuel and to drive you know conflict uh it uh it obviously goes beyond belief and it starts to move into an area where there is a very wide spectrum of action yeah and uh it's very easy to tip yourself onto the one side of the spectrum and as a result caused a lot of harm and a lot of damage like we've done in afghanistan like we've done in iraq here's a great lens what is the cost of going to war in the ukraine versus whatever human rights or sovereignty issues they have hundreds of thousands of troops going to war is going to result in more human suffering than what's currently happening for ukraine it's sort of exactly they're going to they're going to be in the middle of a the war is going to happen on their turf the humanitarian interest is in diffusing the situation and the way the way to do it in a way is to is to you know accede to this one demand that putin has about not emitting ukraine to nato which just to say something more about why we shouldn't want that the problem in ukraine and georgia and moldova first of all these are not north atlantic countries right this is mission creep by nato they're in the caucuses and the problem they have is they're sort of these breakaway you know russian republics but inside of these countries there's breakaway provinces you know there are ethnically russian areas within these countries that want to break away from them so you have a breakaway within the breakaway and so you've got these powerful complicated it's very complicated so for example in georgia in 2008 when there was a war there and russia did invade georgia but it was on behalf of these breakaway provinces of south ossetia and abkhazia and then in uh in ukraine they've got um the donbass and and crimea which has now been annexed by russia which are these majority ethnically russian areas you know and same problem in moldova so the problem is you've got these like incredibly complicated border disputes within these countries based on ethno-nationalist tribalism and you know sounds familiar right the us does not have a vital national interest in getting involved in those disputes and by admitting these countries into nato they could pull us into those disputes because the key provision article five of nato says an attack on one is an attack on all we're obligated to go to the defense of those nations how is the security of the united states enhanced by that requirement they get a lot out of it we don't get anything out of it this is slightly this is a distinctly different than say taiwan as an issue but let's put that aside and we'll get to that in a second if china and russia and the united states are in this very complicated chessboard is there a way not only to defuse the situation but is there a way and i know this sounds like a crazy hail mary to deepen the relationship with putin and make russia and the united states in some way allies against this relationship with china because the russia-china relationship is also very complex is it is there some path to us having a relationship she's holding a summit the last person he saw in real life was the leader of pakistan in 2020 before the pandemic started do you know who he's meeting with in two weeks before the olympics started in a week it's put yeah in person and then the there's going to be a tripartite uh alliance conference between uh china russia and iran great so i think this idea that that all of a sudden somebody's gonna found some holier holier-than-thou perspective on what the right thing to do is for other people is going to be challenged so those guys are going to think about themselves and they're creating alliances to basically further advance their own objectives and so i think we have to as well the thing here i think what de-escalates all of this is economic sanctions and monetary impact because if nordstream 2 doesn't get turned on which is in germany's control that has a huge economic impact to russia explain what it is north stream two is that pipeline that i just talked about the nat gas pipeline that that basically doubles the amount of nat gas flowing from russia into germany and essentially into all of europe but hasn't germany said if they invade the ukraine they haven't said it they haven't said it on the record they it is it is thought that chancellor schultz that that it's theoretically on the table but it hasn't been officially declared biden today said that he's talked or somebody in the white house um has talked to all the major banks in the us about crippling economic sanctions so i i do think the way this gets de-escalated is through money and if you you know if you severely impinge russia's ability to sort of grow their economy that foments a lot of you know anger at home and i don't think that you know that'll probably weaken and destabilize putin more than you know uh trying to sort of have a an i don't know some kind of like get together and hug it out session with him yeah i mean so jason you raise a good point with you know can we improve our relationship with putin obama tried right we had the whole reset and ultimately it wasn't tremendously successful but i think a lot of it has to do with the way that the foreign policy establishment washington sort of reacts and i obama had some really good quotes about this um i think it was in that atlantic article where you know first he's described that uh you know that russia has a vital interest in ukraine in a way we don't because it's right there it's on their border they've been attacked russia has through the ukraine you know throughout history so again it's just a primary interest of theirs and uh so after saying that um obama then you know he he basically got attacked you know by you know in a but it was some of it was partisan but and then he responded to the attacks by saying if there's someone in this town washington dc that would claim that we would consider going to war with russia over crimea and eastern ukraine they should speak up and be very clear about it that he challenged and then he said so so so the ish and no one did right noah was willing to just come right out and say that we should go to war over this and that's how he defused the attacks on himself and then obama continued he said there's a playbook in washington that presidents are supposed to to follow and the playbook prescribes responses to different events and these responses tend to be militarized responses you are judged harshly if you don't follow the playbook even if there are good reasons so what obama is saying is that noah would defend a more militarized uh posture and and going to war against russia over the crimea and yet he was somehow portrayed as suspect you know by not being tough enough on russia and um so you know if you're putin and you see constantly the foreign policy establishment you know reacting in this way it's it's not a problem that even one president can just fix overnight you know what would change this is if when we send a hundred thousand troops over there uh it's a draft and you know it's not a all paid military the fact that these people in washington who got their kids in georgetown or harvard or wherever they are stanford don't have to send their kids over there to fight this war is one of the reasons they can write these documents and have these doctrines that hey you gotta send all these troops into harm way harm's way like if they had to send their sons and daughters it would be a much different discussion of like where we're going to start a war whether it's afghanistan or the ukraine right let's go to markets um bill ackman uh came over the top he's buying a ton of netflix and tesla just absolutely flipped to becoming a money printing machine uh and had a ridiculous quarter revenues up 53 to 53 billion up 71 year-over-year q4 revenue 17 billion 65 year-over-year and they increased their deliveries by 71 and uh you know now you're all of a sudden to start to see some uh you know income coming into the company so flipping from money losing to break even to now printing a ton of money microsoft had an absurd quarter uh their revenue hit 51.7 billion up 20 percent in the quarter 20 year over year pays for 200 billion dollars in revenue in 2022 and their net income was also up 20 plus percent at 18.8 billion so the money printing machine in these companies is just extraordinary chamath what are your thoughts i think you're you're you forgot a couple of key things which is that the fomc meeting happened this week and powell basically said look we're going to start tightening in march i think the way that he said it you know all of these words tend to be so scrutinized and overanalyzed but the instead of figuring out what people thought i think their actions post the fomc are important which is that you know we effectively now started to price in about five rate hikes this year so probably five 25 point rate hikes effectively that's what that's what the that's what the yield curve tells us if you take a big step back i just want to remind people like it's really hard to live through volatility right and we're in the phase of it now but typically these big drawdowns so like you know when stocks go down it actually precedes so it comes before the actual starting of a rate hike cycle and so if you go back to the you know from 1950 onwards today every time the government has started to raise rates or the federal reserve has started to raise rates the stock markets have actually rallied now why is that it's typically that they see through the end of the rate hike cycle and they start to price the business as if these rate hikes are done and to to rebase things and on average i think the stock markets go up between seven and eight percent so call it seven and a half eight and a half percent and so what's interesting to me is now we're finally starting the process of these hikes and the real question is going to be how data dependent do these guys get and what i mean by that is so you know we talked about this before but you know china cut rates this past weekend actually germany decreased their gdp forecast and so you're starting to see two huge countries already say hey wait a minute we need to be you know we need to be more realistic about what long-term growth looks like here it's inconceivable in my mind that those countries are slowing down and we won't and so i think what happens in these other huge gdp drivers of world gdp will affect us and so you know sax and i have said this before but the marginal risk will be that we over correct and actually create a recession that doesn't need to be one so we slam on the brakes too hard and another way of saying it is so the rain hikes are the market is a leading indicator of what's going to happen post the rate hikes we had a nice relief rally going until i think some of the words that powell used was that there was plenty of room for rain hikes yeah meaning that because unemployment's at three and a half percent that you know we're at full employment and that means that the fed can you know has this dual mission of keeping inflation low and you know keeping employment high so if employment is high then they've got more room to raise rate anyway it was that language around the plenty of room that freaked markets out and it triggered a huge sell-off i think to jamaa's point i don't see how you can have this much wealth destroyed so quickly and have it not impact the real economy there's a lot of people out there who feel a lot poorer because their portfolios have gotten slashed in value i mean with bell tightening they'll clench not spend as much money on a vacation not buy a tv or a car so these wait lists for cars might get you know become sales the luxury markets of the economy the optional purchases uh start to really slow down and so i think that the risk of recession now is much higher than it was even a month ago now you know it's going to be hard to know so basically i think what we're saying is it's going to be very hard for the fed to engineer a soft landing here where we don't trigger a recession uh in the process of stopping inflation and um look we'll judge powell's performance you know at the end of this you know we're not going to know i think it's but i but i think that he's turned out to be much more hawkish in his statements than markets were expecting again and in 2018 you know he was probably overly hawkish and he actually created effectively a little mini recession we we didn't pay attention enough to it because you know trump made it impossible to see the signal from the noise but it did happen and it was powell being a little too trigger-happy and so you know we have to remember that you know the fed has nine trillion dollars of assets on their balance sheet and so you know if they start to take nine trillion dollars of cash out of the system by selling these assets into the market right you're taking the money out right because you're getting money back that's going to have an enormous huge impact as well so if you think about your question what happened once again let me just finish one second one second let me finish please so you know so when you have these two things happening at the same time you have a potential rate hike cycle which makes the cost of a used car more expensive the cost of your credit card balance is more expensive the obligations you have to pay just become naturally more expensive you feel poorer so you spend less and then separately in the financial markets you actually take liquidity out of the system and so people value you know uh liquidity more it becomes it becomes worth more you you value current cash more i mean we're putting ourselves in a really delicate position so he's got a delicate balancing actor he is definitely on a tightrope so if we pull 9 trillion out we've been talking about this deficit if he starts selling all of those assets does that mean on the united states balance sheet that will reduce our national debt no where does the money go we're getting nine trillion of cash right you sell an asset you get cash for it right and so it pulls money out of the economy in the same way it created liquidity when they were buying assets right when they were buying this debt it would put push money out if they're selling the debt it pulls money back in what happens to those dollars is my point like what is the dollars in the united states the dollar stays in the us usa's bank account but the obligation the note exists in some financial intermediary that holds it clearly powell does not want to be remembered as the fed chief that let inflation slip the leash right i mean he he's gotten religion now around the idea that this inflation is not transitory which was his position for months i think that now bit him and the risk is potentially an over correction but he's not gonna let inflation he'll then he'll be the first fed governor to have caused two recessions i think it's like a serious risk and and by the way these market levels that we're at right now i mean look sixty percent correction and growth stocks okay but this is with that's still in a good economy in peacetime conditions and now we have a risk of recession and war so you know there's still room for you know a lot more negative news here is kind of my point and um but look sentiment's also very negative so when sentiment is this negative there's also the potential for markets to quickly recover but the sentiment is there for the wrong reasons i think i don't think people are thinking recession i think people are thinking my gosh these rate increases my gosh i can't own these high growth stocks anymore and none of those things are true those are just perceptions that get amplified by one's emotions when you're getting punched in the face which is what happens when you wake up every day in your portfolio by the way five or six percent it generates incredible opportunity the uh you know the idea that markets bucket quote-unquote growth stocks together i think um kind of obfuscates an important point which is that some of the businesses in that category are real businesses that are going to succeed over the long run and some of them are speculative and are likely to fail over the short run and um you know as you saw netflix sell off bill ackman very smart came in and bought a bunch of the stock i don't know if you guys remember this but in 2011 tcv which is traditionally a private equity investor at the time and there wasn't a lot of crossover and public market stuff happening [Music] they were a private investor in um netflix netflix stock tanked from um i think it was around 220 a share down to 70 bucks a share in a couple of months and tcv did a 200 million dollar pipe into netflix um and everyone's like oh my god what are they doing it's incredible and by the way that was uh on an adjusted basis that's ten dollars a share in today's share price so that that that 200 million investment that they made went up 60 60x you know at the peak of netflix a few weeks ago and so you know seeing bill ackman come in and underwrite netflix again and and make a big investment at its current market price so jay hogue i think it is really highlights that there is just because the market price is down doesn't mean that a business isn't fundamentally valuable and going to grow and going to generate significant returns over time as a as an operating business and that distinction starts to present significant opportunities in a market condition like this and the businesses we all talk about generally growth stocks are down 60 but maybe most of them shouldn't have even been public companies in the first place maybe they should have been speculative private investments where more than two-thirds of them were likely to fail and they shouldn't be failing as public companies and the few that are getting damaged and hit with this market sentiment shift can be picked up cheap and there's a lot of opportunity and so i wouldn't view the market condition to be necessarily reflective again of the economy or the condition of businesses in general jay hogue was a partner at tcv he's a founder of tcp that did that deal and he's also the one that participated and led the billion dollar uh round into peloton before they uh whiffed earnings and got and got decapitated but he's an incredible investor that trade is probably one of the best trades of all time so let's look in the good news column wages way up earnings weigh up 10 million job openings in the united states pretty close to record low unemployment and the pandemic ending ending and people having record savings in their bank accounts and personal balance sheets so how does all that good news the pandemic hasn't ended it's ending for people i think it's over for people like j kell i'll tell you the thing i'm most concerned about there's a reverberation that that persists in supply chains i don't know how much hardware lab biotech consumer goods businesses you guys are involved in i'm involved in a number of them every single one of them are crippled in some way right now by supply chain issues i mean i'm talking about like businesses that have been operating at steady state for many many years when do those get worked out we don't know and everyone's getting surprised and hit upside the head every week with some new supply chain shortage whether it's some chemical you need for some lab equipment or you know the the delivery of some big piece of equipment or even plastic bottles that we use it's to kind of fill up our beverages that we ship that's a pretty sizable business we've never had supply chain disruption like we're seeing right now i'd like to bleep out the name of that company yeah but it but it's it's like it's a bleep this out but it's a significantly sized business that um has never had supply chain issues it's all us-based but some of the suppliers of the suppliers have had complete failure and delivery and all of a sudden it's now reverberating through the supply chain you guys saw that gm didn't deliver a single freaking electric vehicle last quarter because they couldn't actually get the chips that they needed to make cars so the real risk to the economy in my opinion right now is when and how we're going to work our way through the supply chain issues and it is so complex and there's a myriad of problems and it is a global problem that it's really unclear how this is going to play out over the next six months and what will happen is this quarter and next quarter businesses that you didn't realize and didn't expect are going to get hit with supply chain problems are suddenly going to say guess what our revenue is off by 20 30 because we couldn't sell this product because and half our shelves are empty because product didn't show up or whatever the the narrative might be all right so it's a real problem i think it's a really i think it's a great point because you don't solve these supply chain issues with rate hikes right it's like nothing to do with that nothing to do with it so the rate hikes slow the economy that's why i'm i'm way more worried about this than rate hikes right what does clean it up is capitalism the end of the system um and the reason i'm less worried is when you actually talk to the companies that that are spending enormous amounts of money on capex they've actually guided to the fact that by the end of this year in the beginning of next year most of these things will be worked out that's indigestion so i think i think we're i think we're dealing with a you know six to nine month issue of having turned things off and now we're now rapidly trying to turn things back on and we can't necessarily get that timing right but i do think it'll work itself out faster than people expect personally that's what i think because the cost of apple and tesla specifically guiding to that is too enormous you're talking about you know collectively almost 4 trillion of market caps so they're not going to get something like this wrong and they were pretty clear in the last few days that that this will be done by 2023. early 20s so saks or moth i just listed all the good news to counter you know the the the slog and the and the bad news how do you account for record low unemployment record number of jobs record wages going up massive cash on people's personal balance sheet massive amounts of sideline cash massive amounts of venture funds being raised that have to be deployed in the next five years all that good news where does that on this balance sheet of good versus bad you know work out for you sex well the the negatives are that yes the unemployment rate is very low but a lot of people have dropped out of the labor force so the labor participation rate is still quite low so because of well because i think a lot of people dropped out because of covet you know everyone wants a remote and um i think you know they got these to me checks and i think a lot of people got used to not working you know maybe maybe you had a household with two people used to work and now only one of them is working you know maybe they move to a cheaper part of the country so i mean maybe it's a good thing right but a lot of people dropped out of the the labor force and they haven't come back and so that's the negative and then you know the fact that wages are going up is good but we don't know how much that's inflation right so you know those would be the negatives but there was a report that inventory levels did rise in q4 and so the supply chain issues do seem to be ameliorating to something totally i was looking at cars and now a lot of the people who had you know there's no way to get this car now they're like hey we got a couple of these cars available if you want them and then if you look at the housing inventory it does seem that maybe that's taking a plus too and people couldn't find houses and now maybe even though it's still a housing crisis maybe there's more available or they're staying on the market a little bit longer yeah i mean it i think it's pretty clear that economic activity is slowing um and again things like rate increases they uh it increases the the cost of a mortgage right so that could affect house prices i think there's an interesting startup story um there's a private company that's doing essentially life extension that a bunch of rich people put three billion dollars into you wanna tell us friedberg in your science segment well it's just to make us live longer or not well i think i mentioned this company a few episodes ago but i think they just announced their um three billion dollar investment um and and again this goes back to the um the point i made on the prediction show so last week altos labs announced that they've landed three billion dollars in funding and this has been an ongoing funding that's been going on for quite a while into this business but this business was set up uh to commercialize yamanaka factor-based cellular reprogramming for age reversal and there was a paper published just yesterday i'll put a link in the show notes that if people are interested in reading a scientific paper they can take a look incredible results scientists took mice gave those mice short bursts of these yamanaka factors and then measured all the biomarkers all of the chemical signatures in the blood of those mice to determine their age because there are known ways that we can measure the age of an organism by looking in their blood and measuring certain biomarkers and with just a few short births for about a week of these drugs these um these yamanaka factors the mice all of their age signals reversed to making it look like they were very young again and it did not do what the challenge has been with yamanaka factors in the past is if you put too much of it in in a body in an organism the cells rejuvenate to becoming stem cells which is kind of like what a fetus might have and starts to grow a lot of tumors they were able to avoid having tumors show up in the mice and the mice in fact all looked extremely young from a biomarker basis so an incredible result an incredible paper whether or not it gets repeated and shown by others but i think this speaks to the quality of the science that's underlying the three billion dollar investment that was just made in altos labs which is probably one of the biggest seed investments ever no idea it clearly is the biggest seed investment ever in a startup and i think it speaks to what i highlighted what what will be the new frontier in biotech and will completely rewrite like you know the course of humanity is if we can take drugs and for a short period of time completely reverse the age of ourselves and it sounds so crazy and so wacky but it's being now proven in in a single week we've now had an amazing paper published and we've seen the startup announced their three billion dollars of funding to pursue commercialization of this technology and this is going to be the year i think this will be the front cover of a lot of magazines this year as people realize the that this is real and that it's getting commercialized why do you think they have to start with 3 billion and i'll tell you why i asked the question yeah whenever i see these grandiose prognostications of future progress and then see these companies raise exorbitant amounts of money i have never found a single example where it's ever worked ever in fact every time i see a company raise an exorbitant amount of money in a series a i write them off in my head yeah sure yeah so why why should i not in this case so or it's more actually actually a better question why would somebody listening to this pod go work there by the way by the way the same has been done and can be said about calico which is alphabet subsidiary that's that's pursuing similar research where billions of dollars have gone into that business and there's a similar sort of research track underway and i think the general principal chamath is they don't know what the product is they don't know the way to market they don't know you know what area they need to explore but the underlying principle is proven the underlying principle is something that people believe in this science is proven this science is real we don't know the commercial path and we have to try lots of different things and run lots of different research programs in parallel to figure it out and each of those research programs is like a hundred million dollar biotech startup and so i think that the principle is let's put a lot of shots on goal all at once in parallel and make sure because if any of these shots on goal work this is going to be worth many many billions of dollars so i think that's generally the idea it's almost like having a three billion dollar venture fund but the venture fund is targeted at one core area of interest that we believe is real and i think that's the way a lot of these things are being set up but i'm asking this question have you ever seen a company try to do 30 different things and it works no no yeah i mean it's not the typical capital allocation milestone based funding scheme i have it the theory but it's not a product market fit thing right it's it's a it's a research program and it's a series of research programs but i mean look let me reframe it for each month have you ever seen a three billion dollar venture fund that makes a hundred bets with smart people at the helm with smart people working at the individual businesses fail right like yes and in fact i've never seen a three billion dollar venture fund do much more than return two extra money yeah well look let's see i mean it's a it's a big bet and obviously there's some people making nice management fees and nice carry on this thing i'm not trying to be a wet blanket i'm just curious you know why do it that way meaning you know every startup let's get bob nelson on he'll talk about it yeah yeah every startup i think is forced in some ways by the market to make an educated guess about where product market fit lies and to try to build some minimum viable product that that tends to be how value is created i mean you could have said that you know google could have had 90 different algorithms but you know larry page started with backroom that's how it started he had to make an educated guess that he had to make decisions and that's what startup's about you have to make decisions in your choices well you have to make a bet on your on your own why why don't you put all your capital into one company oh because mostly the companies won't let me but i would if i could oh interesting so i i think that what's happening here i mean you're absolutely right if i could i would but they don't let me you could buy you could put all your money back into facebook or back into forget facebook i know you got issues but what about alphabet or amazon just put all your capital in one bet and just you know write it out right but then it comes to what i think where i can generate the best return meaning you know i think that i could generate much higher returns than what i think google will give me yeah that's why i do it well here's what i think's happening here there are a lot of rich people who are going to die soon and they're counting down like bezos and they're saying if why not if i'm worth a hundred billion put one two three billion into this and have them go for it because i've got nothing to lose because i'm dying in 20 years this is a fear of death by billionaire bet which is exactly what i think happened with the google guys they were just like the team involved in these projects are not first-time founders or people that are great pitch men it's people that are repeated tried and true entrepreneur success stories that have done this over and over in biotech and they're the ones that are being drawn into working on these projects and they're saying look because we've got the people that have done it over and over give them the capital i mean that's a good argument yeah i believe in yamanaka factors and i believe that there will be innovation my only question is is the innovation going to come through a small team that raises a small quantum of capital with one very focused idea that gets it right or this sort of you know monte carlo simulation approach to product innovation and all i'm saying is just an observation that historically it's been very difficult for these monte carlo simulations to ever work either to generate product market fit and an innovation and to make money now hopefully these guys are the exception that proves the rule because i think we'd all want this to work no it's a it's a great point and i hope you're right and i hope to start that small project and whiteboard that's right now you're saying the key thing because despite the three billion dollars you're still going to go after it which implicitly is your way of saying i'm short that company and i'm long my own company and this is this is the point i was trying to get to which is when when it's really really smart people see these things they tend to look at it with a grain of salt thinking it's very difficult to build a startup as it is yeah sometimes it's kind of like growing great wine you need to have a little pain and suffering along the way and when you have three billion dollars it's the opposite of pain itself totally true and i'll also say what let me just support your point which is the people i see get hired to big projects like this and there are a number of them that get funded not just also in in other kind of deep tech stuff they hire the tried and true experienced executives who generally have older kids and live in a nice house and have made a bunch of money and the earnestness the motivation the hunger uh the fuel the the creativity because they know what they know and they're not willing to accept that they don't know what they don't know um those folks generally are less likely to succeed than the folks who are doing this maybe for the first time for that very reason when you're doing something innovative so i totally support your point and uh and i really do hope you're right but i thought jason when you were talking about talking about startups i thought we were going to talk about bolt and the striped mafia fiasco this wow that's a good story it's a pretty crazy story where does everyone follow what side does everyone fall out on that does anybody have any equity positions in either company let's start there no no stripe holders no sacks saxophone are you an lp in any firms that have uh i am an lp i'm an lp in funds that have exposure to it absolutely yeah for sure i'm an lp and a fund that has exposure as well but it doesn't miniscule that doesn't affect minuscule doesn't matter no skill for me too okay here we go so for people who don't know bolt is like one click checkout software they compete in some ways which stripes payment api the ceo ryan breslaw did a tweet thread basically saying that yc and stripe are the mob bosses of silicon valley it was pretty charged obviously uh stripe and yc worked together uh stripe is the biggest company to come out of yc ever i guess along with airbnb um he claims that a lot of the top vcs were blocked as a strategy by stripe and i think there is some truth to this when you invest in one company you don't invest in the competitor i don't know if that happened here as a strategy but it is a viable strategy that other people have used where bolt claims stripe got all the top investors therefore they couldn't raise money he also was saying they were voting things up and down on y combinators hacker news as if that matters yada yada it was kind of a uh weak argument in my view i'll give you my results hold on a bunch of vcs dunking on hold on i'll give i'll give you my outtake so first of all bolt is now a 14 billion dollar company or something okay so the you know these guys i think this was a very brilliant pr strategy and it worked what do i mean by this this is a company that most people didn't know about until this past week they went and they punched up which is a pretty tried-and-true pr strategy always fight up you pick the big guy who's an incredibly pristine extremely well-run company that is sucking up most of the talented you know people in silicon valley to work for is a you know centicorn could be a trillion dollar company over some lifetime so they went and they punched up and what happened everybody fell for it they baited all of these folks and then all of these folks had to come out on twitter and land past them and basically the net result of it is if one person knew about bolt before now hundreds and thousands of people know about bolt afterwards so not only do they not know them they're now they're contemporary just in terms of the practical reality they are now part of a discussion and in a framework of companies in this space that they were never a part of before this is steve with a 1984 commercial he said ibm and then microsoft our big brother we're going to attack them join the rebel alliance be part of apple and of course apple and ibm responded and that was the big mistake and mark andreessen sequoia a bunch of different venture firms responded sax what's your take on this i see you're chopping at the bed or maybe you're biting your tongue which isn't no i i agree with jamath that it was kind of a brilliant pr move if that's what it was i i do like startups punching up and he took a punch at stripe which is the big company in the space so and then yeah stripe stripe didn't respond directly the colsons didn't respond but their surrogates did and then that looks like punching down and it draws more attention to it so i get the pr strategy i would say that as to the merits of the allegation i do i i it's interesting that you know he didn't get into yc because i think that he is a very talented founder and um you know we looked at this company pretty yeah pretty early on it was for like sort of a mid-stage growth round and it was like one of the toughest decisions we uh we fa i'd say the toughest decisions as a vc are when you actually want to invest in the company but the valuation is like 2x what you think it should be and that was kind of the situation at the time when we looked at it is i think we actually would have invested this is the valuation was too high so it would have been a great bet for you yeah he grew into it and so it would have been a great bet so it was a bad decision on your part yeah yeah clearly we should have invested it's just that you know at the time you invest you have to have some basis for valuation and and that's the sense in which i think you know maybe ryan's accusations don't totally make sense is that he's been able to raise a lot of rounds at really high valuations and so he he hasn't had a problem you know raising a lot of money at you know great prices and it you know it almost feels like a slap in the face to his investors where like what's the complaint i didn't get any tier one investors or that it was just hard to meet with investors and that stripe called the investors and told them not to invest that that was the allegation yeah no i mean yeah i i i can't really speak to that but he was clearly able to raise uh great rounds so can i read to you an email exchange between me and ryan breslow oh dramatic reading from 2015. uh-oh here we go hmoth hopes all all's well um fyi things felt too rushed on our end so we're toning down our series a discussions for a couple months and this was this was in july of 2015. i'm i'm reading you my answer because it's so fabulous hi ryan after a wholly unsuccessful few weeks of attempting to win a world series of poker bracelet i'm back at home licking my moons how about we talk in a week or two so not only did i have a chance to win a world series of poker bracelet according to this exchange which i didn't win obviously duh i had a chance to do the series a in a 14 billion dollar company screwed that one up too big dummies i mean the things we miss are there's like 20 things you missed as an investor for everything you hit so i might i i've interacted with ryan back in the day and i just remember me being super super smart and i do think that you know there's a lot of very smart people now around the table at bolt including joanne bradford so i don't think that this was something that wasn't planned and i just think that they executed it well and it worked and i think a lot of people know this company that didn't know before now they still have to execute and build a product and scale it and do all of these things but yeah and i think that the response he provoked i mean since i was a little bit critical of what he said me to say that one of the vcs who responded said that the reason they didn't invest was because the numbers weren't good that was not my experience when we looked at this company they had great numbers it's just the valuation was ahead of those numbers but the numbers were always great i actually responded to that and that was sequoia partner sean mcguire who said that and i responded to him like hey dude vc code is you don't reveal the numbers on things you learn confidentially what are you doing like and he's like well they said some bs about stripe i was like yeah it still doesn't change vc code that if you learn something under nda for nda essentially in a meeting you're not supposed to weaponize that again unless you unless you have a 30 billion dollar position i still think well whatever i still think it's like i've never seen a vc honestly it's the first time i've ever seen a vcd jason jason come on i i don't i think it's pretty i think we all knew where he was coming from he's defending an enormous position of his insecurities jason you've always been in here but i've they met with them but he was conflicted out so why would he meet with them hey guys nick just texted that i uh had i had i found a way to get off my lazy ass not be playing poker and do that deal i would have generated a 222 x on my investment price which would have been 15 million times 222 i think i think we looked at when like a 400 million evaluation or something like that or something in that range my gosh well the series they have been i mean the series they would have been at like 20 30. three million according to pitchbook oh yeah you know it was one of those meetings we came out of where it's like that's a super interesting founder so yeah me too that's what i remember too from ryan yeah super super super interesting founder write the check i said earlier in the program that like our philosophy now is just to be price takers and just to pick the companies yeah that we want to be in and then the market sets the point that's the biggest mistakes i've made as an investor i've got two people we should have done that with bolt this was the decision we faced was like a few years ago and so we just shouldn't have worried about valuation by the way sorry jkl as soon as you said it was 63 million you know what my reptilian brain said oh that feels so expensive even now you know that the outcome is 14 billion and so your point david that's a really good lesson for for investors to learn is just you're a price taker totally get behind these really interesting people that are world beaters and just let them do the work place to bet yeah all right so there you have it uh this has been another amazing episode of the all-in podcast bye-bye bye-bye love you bassist [Music] and they've just gone crazy with it [Music] besties [Music] we need to get back [Music]








the fact that sax's greatest moment in life was beating peter thiel in a multi-game chat so you ever see that picture of yeah of him with his arms raised can't believe he beat i mean tell us about that moment nick show that picture of saks i mean listen here's what i say when i when i saw that picture i had a couple thoughts number one i've seen this picture somewhere else and then number two is oh my god it was on nbc's to catch a predator i mean i have never seen sacks happier i like the birth of his children oh my god in comparison to this moment i'll tell you that was the day of paypal's ipo and so we did a party in the it was like a keg party in the parking lot that was the extent of the celebration and peter did it yeah he did a 10-game simultaneous which means he's playing against 10 people at the same time and he goes board to board makes his move and i was the only one out of the 10 that beat him and somebody i guess i mean on the left i put money down i put like 20 bucks down or something on the game which is a foolish thing to do against peter because he's like a chess master and uh and i somehow i won and you can see i've got the money in my hands raised up look at the look on peter thiel's face he hates losing look at the look on p i mean he's so angry he and he but he sees the joy in your face and he can't process it and look at max max is to my right and roll off yeah but this was a few seconds before peter smashed all the pieces off the board and uh what yeah if he flipped the board he always does that when he loses and uh his motto is when you call him a sore loser he says show me a good loser and i'll show you a loser wow that's such a great line but i just want to also comment on the pleats on sax's pants and how high that waste is i mean strong hair roloff's always had incredible hair his hair is incredibly bright hair to this incredible thick yeah it's still thick like that beautiful hair never noticed [Music] [Music] all right everybody welcome to another episode of the all in podcast with us again today the dictator chamath poly hopitia rain man david sax and the sultan of science formerly known as the queen of quinoa he's out of that business david friedberg we got a lot on the agenda however one thing that we've had a hard time figuring out is the state of the supply chain and it's confounding it seems like nobody knows what the hell they're doing but there's one guy who's been on twitter and we happen to know him he's he's been on my pod and freeburg knows him and his name is ryan peterson and uh he's a bit of an expert on this and we thought we'd have a bestie gusty come on we don't do this too often maybe this is a third or fourth bestie guestie and um welcome to the pod ryan peterson from flexport what's up guys thanks for having me on what's up ryan ryan did you tell olivia you were doing the show today no i didn't tell her so she's gonna she's a huge fan oh don't tell her where is she right now is she like not there she was in the room next door but i totally mean i'm doing a podcast she knows i'm doing a podcast she doesn't know which one that's fantastic she's a super fan she's a very big fan she's literally wearing the wet your beaks hoodie right now it's awesome fantastic my coincidence she doesn't know him on the show fantastic so what you're not gonna tell her right she's just gonna watch my next show and you're gonna be on it we'll listen to it yeah we'll probably listen to it together tonight whenever it comes out ryan what is the state now should we be worried about the supply chain is it getting better is it getting worse what's 2022 gonna look like yeah i mean i think the supply chain means a lot of things and it'll depend what your industry is what's really happening but you know because it goes for everything from manufacturing products which means sourcing all the sub components like semiconductors through logistics and final delivery all the way to a customer store and where flexport focuses on is sort of picking goods up from factories around the world and delivering them into fulfillment centers all over the world so kind of that global mile uh is what we sometimes call it there you're seeing real disruption um and it starts really with the pandemic shift in consumer behavior where people started buying more goods because they couldn't go to restaurants and travel and things and so a lot of spend shifted onto goods and imports are up almost 20 imported container volumes so that's the start of it all uh and then what we learned is our infrastructure is dilapidated and unable to handle a 20 increase and by infrastructure i mean the number of ships in the world the capacity uh throughput of the ports the number of trucks and availability of trucks and chassis which is the trailers that haul containers around which didn't have enough of these things or the port capacity you know like look at uh american ports operate this i just learned the statistic pretty recently and i keep saying it because it appalls me our ports operate with a lower throughput and productivity level than mombasa kenya and you know we just do not have modern port infrastructure roger dam's been fully automated for 20 years so if they want to run 24 7 and keep containers flowing through the port they can do that with self-driving trucks and everything is that a technology issue or do you think that's a regulatory capture and union issue like a labor issue like a labor the tech is there you know it's existed for a long long time it's really about labor getting together with management negotiating these things and allowing it to happen and the way that our ports are run is it's pretty crazy when you look at it they treat labor as a fungible commodity as in the the poor terminal operators will say i need this many workers tomorrow and the union provisions that many workers but there's different people every day doing operating complex you know heavy machinery that you can't like the number one thing in business is like what did we learn today and how are we going to do better tomorrow every day with your team but if it's a new team every day like that's not even possible so i don't know how you can drive a productivity improvement when it's different workers every single day of the week right so wait they're not full-time employees they're like staff by the hour they're union workers they're paid by you they have annual contracts you even decide who goes to work every day and who gets shifts yeah and where and so they'll show up at different terminals and there's like 15 different terminals so they just kind of move around do different things essentially what we saw on the waterfront yeah where like the union decides you get to work today these other people didn't whatever it's like literally like that movie yeah it's literally like that even going further back in supply chains to manufacturing centers how much are you hearing about and seeing kind of labor shortages because people are out for covid and hey someone's sick they got to take 10 days off and when you know 10 of the employees get sick and they lose 10 days of work the facility sees a decline in productivity to you know 70 80 of normal and then you know all of the output of that facility goes way down i mean are you know are you hearing about more of that stuff happening particularly during this kind of omicron wave where the real effect of that hasn't really hit the supply chain system yet and we're still kind of seeing a build up of uh you know of demand and we don't you know we haven't really kind of hit the problems so for the last 18 months china had this total zero tolerance policy and was very successful in keeping kobet out of out of their country and so manufacturing just kept running as if not no problem in china which is the majority of this manufacturing with omicron you're starting to see that it is still taking hold in a zero tolerance policy we haven't yet seen like major shutdowns and waves of shutdowns but a little bit you're seeing that here and there the zero tolerance policy has shown up for example uh at least twice where one launch one port worker in a chinese port got coveted and they shut the whole port down for like three weeks yeah that's crazy it's really extreme i mean u.s workers have been getting covered non-stop and the ports keep operating even you know we have lower level of productivity but they'll shut the whole port down that happened both at yantian which is the largest port in china or second largest and ningbo which is the third largest so it's it it's been very very disruptive it's also happening at the airports over there so that's something i'll definitely keep an eye on here over the next couple of months or even next couple of weeks are we still having this like uh we're ordering too many goods and we're backed up or is it that we're backed up for six months just trying to fulfill all those pandemic orders like what's the state of the backlog today if you could describe it so volumes are high but they're sort of flat they're over you're over here they're flat now they're much higher than pre-pandemic but they're pretty much flat year-over-year and that's what has me so worried here is that you have increasing delays even though the input's the same and when you have a complex system where the same amount of inputs coming in but the delay is getting longer and longer that's a very worrisome sign like if you're ever building a technology system you're building this uh system and you're sending the same amount of bits in and the performing the job is taking longer and longer that should be like that would be a very alarming sign that you're going to want to send some of your best engineers in here to debug the thing but i think we're seeing that like because a lot of companies people don't realize like when they buy capital equipment like machines that you know are either sold to end users or machines that are used in their own production systems capital equipment is typically assembled last minute it's not like you know there are companies that own huge pieces of equipment and then they ship them and they just get plugged in and turned on there's usually components associated with them and you know in businesses i've been involved in over the last couple years we've got a lot of lab businesses and hardware businesses and just getting capital equipment has been like delays like we've never seen it's like you know a year to a year and a half for something that used to take four to six weeks to arrive because the company that makes that equipment is having delays with each of their component suppliers and then all of this stuff backs up into the system and it plays out where the end user is now stuck waiting a year year and a half and the business doesn't make progress and a lot of hardware companies in silicon valley right now are facing these significant shortages where they can't get the equipment they need to ship product to their customers and they're sitting around burning money every month and so the when the result will actually show up down the road when all of a sudden they miss revenue three four quarters down the road and that's why i've been saying for you know a couple shows now that the biggest thing i'm concerned about is when the revenue shortfalls start to hit the companies that are dependent on these supply chains but you don't actually see their revenue shortfall for a couple of quarters after the supply chain problems hit them and just this quarter with the quarterly earnings we're now seeing there's a company yesterday that reported called ingredient their big food ingredients company and they just reported how supply chain problems have now backed up to affect and the stock was down like 10 11 yesterday and this is like a very stable very mature third largest producer of starch in the united states and their business got totally hammered but it took a while before that hit them um and so you know it feels to me ryan i mean correct me if i'm wrong but like a lot of the the business level and market level risk isn't going to show up for a while after these supply chain problems really persist within their organization this is the thing that has to be most concerned is what what's happened is it's now taking a 115 days on average across our customer base from when the factory says hey these goods are ready come pick them up to when they finally get delivered to the warehouse in the united states crazy 15 days before the pandemic that was 50 and 50 even felt high like the ship is only taking 15 days like what the heck is going on a lot of inefficiency a lot of customs processing hard to find a truck etc even in normal times when you go to 115 all of a sudden these companies are so much less agile like because you've placed the orders and you're expected forecasting demand is so hard and now you're forecasting demand for twice as long of a time period you've already placed all that inventory if your demand goes down guess what you've already ordered the goods so i'm really worried that we're going to find out in six months or in some time period in the future here that people have ordered way too many goods that these companies expected demand to stay high and keep booming at some point consumers start going to restaurants and start traveling a lot more you get pre-covered consumption patterns and all these companies get stuck with way too much inventory that they paid way too much to ship and get delivered and they can't sell it and so i'd be very worried for like middle market kind of retail direct to consumer ecom these types of businesses that aren't very sophisticated and demand planning and end up with way too much inventory i think that there's been this weird dispersion actually and i think that like these supply chain issues are not broadly distributed so if you bear with me for a second if you watch the earnings reports i don't know how close you you watched them rhyme this past couple weeks but like apple and tesla basically said it's kind of reasonably well managed particularly on the chip side and we see the whole thing easy in q4 q1 of next year amazon last night basically said yeah there's some you know toughness in the system but we think it's sort of like you know reasonably achievable and they're past it and so it seems like the bigger companies who have influence were able to manage through it these smaller companies to your point who really do rely on many actors in the supply chain have been really thrown left and right they probably don't know where demand really is so is that sort of the more nuanced actual the way that it's running out yeah and and it's sort of it's very interesting to see this flip so pre-pandemic the biggest companies paid the least for freight because they buy the most freight so they negotiate good rates now they're paying the most and they're the biggest companies for a reason they have the best businesses they either have the best margins the best you know they just built something that people wanted scale to be huge well when times are tough and you need to spend extra to prioritize your freight to get loaded to sign a contract and make sure that these ship owners and airlines honor their commitments and serve step up it's the big companies that can afford it and so they're not paying extra for freight but they're getting around these problems and freight is a really interesting market because it's pretty inelastic like you're either going to ship the thing or you're not the whatever the price is you're probably still shipping it and so like you i haven't ever looked at an apple uh at this level but i'm sure that if you did you'd see that it's a the percent they spend on freight is just negligible so if they doubled it it wouldn't matter but to chamat's point it seems like and i think we're seeing this a lot the bigger companies can actually afford to integrate their supply chains whereas before it didn't make sense to vertically integrate like i think walmart announced that they've spent like 11 or 12 billion dollars kind of rebuilding their supply chain themselves apple obviously has captive facilities all the way down to the fab where they're driving the whole supply chain from fab to components all these foxconn facilities that are operated for them are captive facilities but the tesla obviously you know has a very deeply integrated supply chain team whereas gm probably relied on subs who relied on subs or light on subs and that's why gm delivered like no electric cars but tesla was able to keep volume up the guys that are winning are the ones that are integrating supply chains and do you think that that kind of becomes a persistent solution here where you know bigger companies their competitive advantage becomes hey we're going to own our whole supply chain all the way through we're going to own more of the infrastructure all the way through like amazon's done with delivery vans and ultimately be able to kind of you know have a true competitive advantage because of this disruption that's going on right now yeah potentially i mean i think oh my vision for flexport is that we become that layer and we allow small businesses medium-sized businesses to get access to world-class logistics services and get them you know sort of almost be a union that can represent them at the table as uh against these bigger guys um i think it's very interesting to see a companies like the biggest companies have gone out and chartered their own ships totally wild experiment to watch for my sitting here with popcorn you're bringing up a really important effect of all of this which is what happens now in six or nine months to your point when the consumption of hard physical assets turns towards the consumption of services which it typically does right if you revert back to the mean here you know people aren't going to be buying as many pelotons and all of that stuff because they bought them all right they bought all the physical goods they need and to your point these companies have over ordered all this inventory actually peloton is a perfect example because they basically shut down their entire supply chain last at the end of this past quarter and essentially said our inventory turns will be more than enough to meet you know existing demand for the foreseeable future that's an enormous capital problem that these companies now all of a sudden will face right so like the next step beyond all of the supply chain issues could be um and i think saks has been talking about this a lot like a a pretty bad recession if these companies have all this inventory and they don't know how to get working capital yeah it can be real ugly and and the other the other factor is the price has gone crazy so the price of shipping a container long run like i've been in this business and been a customer of this business for 20 years and you're you can just rule of thumb it cost you two thousand bucks to ship a container from china to the west coast during um 2016 that price collapsed so you have these booming bus cycles of an asset market 2016 it was 550 bucks last year was twenty thousand dollars so it's up 10x over normal it's up 40x over or or more right over just a few years ago and what what that's done is create a real barrier to entry like for a ddxc ecom business you used to be able to go to china find some product put your slap your label on it and go sell it on amazon and you were in business and there's like a huge number of people doing this right now you have to come up if you want to ship 10 containers it used to be you needed 20 grand now you need 200 grand that's like that's a real barrier to entry so actually i've talked to some companies in this space we're really happy like if you have an established business you're like great now it's much harder for joe schmo to show up in china and start competing with me so it i was really surprised to hear that i thought that was a pretty sophisticated take at what dollar point does airfreight compete with containers because when we start hearing about chips i was always wondering and again i'm no expert but putting a bunch of chips on a plane versus putting them in a container given how much those chips are valued by a tesla whoever's putting them into you know a car um it's in what was the break certainly but air freight price has just gone in line and it's gone up five hours as well and one thing to remember is that 50 of all the world's air freight flies in the belly of passenger planes which should kind of horrify you if you're ever flying on a passenger plane from from east asia but to the united states there's a whole bunch of stuff down in that belly and those are grounded so the the supply why are they grounded nobody's flying to china right now oh i see so because there's no now we're seeing kind of the backlog play into commodity cycles right ryan so we're seeing like a lot of these commodities because of these uh discontinuities in these supply chains uh suddenly commodity prices are spiking all over the place and i mean do we think that that settles down or do you think it kind of continues for you know the foreseeable future until this all works its way out yeah i mean i'm not the right person asked about commodity prices maybe tomorrow has a view on that but i i you know on the logistics market i don't see it sorting itself out for the next year um the next couple of years in fact you've warned that it might get worse right you've i mean i saw on bloomberg you said that there could be a union strike in maybe october what are the prospects for that and what happens if if that takes place um so it's on july 1st of july okay the the west coast union it's called the ilwu there that union extends from the southern border so from mexico all the way to alaska and it includes canada so the whole west coast of the united states is run by this one union that deports in they uh their contract expires on july 1st and uh in years past the last time this happened was in 2015 this is a contract that was signed then and extended at some point but um in 2015 it had a three-month period where nobody could import anything on the west coast uh and some major companies missed christmas that year so it uh that's july 1st uh typically these there's kind of slow downs in the lit months leading up to that and we've already had slow downs for a couple of years with hundreds of ships are now waiting offshore so yeah i can't make a prediction this is slow down basically a negotiating tactic by the unions in the past it has been i'm not convinced that that's what we've seen over the last year versus you know they are there are legitimate problems staffing people getting coveted et cetera so is there a role for presidential leadership in sorting out these union issues or just sorting out the issues with the port more generally or avoiding a strike in july i mean it seems to me that if biden wants to get reelected this inflation supply chain issues are pretty top of mind and in the news and are going to be on people's you know you want to be seen doing things and i do think there are things that can be done so yeah there's a role and as far as union negotiations biden's probably pretty as equipped as any president's ever been to negotiate with a union and get them to play nice and not screw up his re-election with a with a strike he's known as a union friendly president can go sit down and do a deal with them where trump would probably never be able to do a deal with the union because they know that they're sort of natural adversaries so there's something there there's a lot more to be done and i you know i got some arguments with people that are like you know that's not in the president's power to do such and such i'm like yeah but he's the president of the united states to pick up the phone like you can do things that aren't legally in your power just by asking for favors and other people do them and negotiating with unions is a good idea a good example convincing to change the zoning laws in la so you can stack containers higher would be another yeah that's not the president of the united states jurisdiction but if he calls the mayor of l.a or the city council can you explain that so what does that mean so in southern california you can't stack a container more than too high in a truck yard by law well we have no place to put these containers but is that a is that a danger issue or is that like a site issue sight lines like what what i assume a little bit about so i think there's some safety issues although they're stacked sticks high all over the world so that's not that legitimate to my in my view um and in california it's what four or something two too high it's too hot oh wow at the truck yards at the port you see them stack six high but in the truck yards two is the limit okay and so it's it's a uh it's also an eyesore especially in california um containers are a sign of free enterprise and it's just the people in california can't stand to see them right they really just object to the idea of capitalism in their neighborhood like that but there could be like some kind of temporary waiver that we do just to get through all of this backlog which is to say okay let's just ease all of these small little things that slow the process down just to get all these ships you know unloaded right yeah off into the world where they need to be and then we could revert back to what we are after things you know kind of normalize yeah so we did that so like i wrote about this this zoning law and what's what's happening then is if you can't stack the container three high there's nowhere to put that third container so you leave it on the trailer and now you have one less trailer in rotation servicing the port to unload and that's that's true across southern california right now there are thousands of trailers with containers on them because they're not allowed to stack them they'll get fined if they do so i tweeted about this and the the city of long beach actually responded i tweeted about it at six a.m by three p.m the city of long beach had changed the zoning law to allow stacking up to five high i believe i'm totally the fastest response by any government to citizen action like ever that's incredible you must feel great about that it was great but unfortunately only long beach did that la never followed drew other and there's not that many truck yards in long beach a lot of them are in los angeles compton rancho dominguez et cetera so i saw this kind of thing like yeah joe biden could call these mayors and say hey let's work on this right yeah but let's face it he's super union joe right like i mean he won't even say the word tesla over there but jason isn't that more pro union because won't these folks be working more and getting paid more and i don't think there's a reluctance to pay right because clearly like you're going to have to put some money into the system and where the money comes from we can figure that out later but the point is that there's a there should be a desire to actually get the people on the ground to be working there wasn't even a third ship shift ryan right like that was another thing you were working on on top of the stacking of these containers to get you know more of these uh you know to alleviate the problem you were also talking about they don't even have a third shift some nights but they seem to have added a third shift did that become permanent or not no uh they do have a third shift but nobody's showing up is the problem so truck drivers don't work in the middle of the night warehouses aren't open in the middle of the night but is that a compensation issue ryan like if we paid more folks show up like is that just a supply demand issue that needs to get sorted out never underestimate incentives um i there's there's just a lot of factors and a lot of a lot of it is it's so easy to point fingers to somebody else and blame someone in the chain right supply chain you've got all these different people and it's everybody has their own opinion you know we at one point i wanted to hear what the union's opinion was what what are they saying because everyone else is calling them lazy and not working hard what's really happening so we i sent a taco truck down to the port a couple of months ago just because we i figured we'd give them free tacos they'll talk to us and that was that's a game changer right there yeah that really works well we got um they loved it they were the only business ever to send tacos to the port and then they told us all about what their viewpoint was they viewed that the truckers are screwing up that 50 of all the appointments where a truck is supposed to come and pick up a container they're missing their appointments right um and because and then and then so that's what sent me investigating wait why are they missing the appointments that's when i learned oh they don't have any trailers these chassis because they're stuck under containers and can't be unlocked so a lot of it is going here it's the supply chain it's kind of like this that metaphorical elephant in the dark room right and everybody sees their own aspect of it but you got to synthesize all those perspectives and kind of take a systems view and see if you can get some real understanding i'm not convinced i have it yet by the way i think it is more complex and i'm really beware of simple narratives if someone even including me says oh this is exactly what's happening like there's really a lot of complexity in all of this right how much how much of this is sort of the the the extreme end of the other spectrum which is basically the u.s exceptionalism view that says okay we just need to really in-house more of the stuff that we need so that we don't actually have to rely on some of these arcane methods of just transporting goods from you know from point a to point b it might be that would be a shame if we i mean we have the best companies in the world who need to be able to source raw materials components finished goods anywhere on planet earth and we should have a modern infrastructure that makes that possible instead of being like oh we can't trade with the rest of the world so we're going to become like self-sufficient you know we might as well go back to everybody being a farmer on subsistence farmer on our own land like i think we should have global infrastructure that's really great and seamless and makes it really easy but you're right that might be an end result as people can't rely on these supply chains and start saying hey let's manufacture at home or let's manufacture in latin america let's manufacture closer to home uh that to my perspective that would be a shame well i think the i think the pro the pendulum always starts from one extreme to the other and i think the the middle ground is probably that you need to have some heterogeneity right you have to have some amount of it that is not just singularly reliant on china maybe it's maybe it's to central or latin america right some that's domestic but that domestic production probably has to be subsidized by something because we're never going to be able to run as efficiently and as cost-effectively as you know cheaper international labor you know unless we invent something really you know incredible so the balance is probably in the middle but it's going to take us a long time to kind of get there i think i saw governor abbott was pitching people on hey just send your containers to texas we're cheaper and more central in the country is that true is that a solution takes much longer costs much more when if the union goes on strike on the west coast it'll be one of your only options bringing stuff through the canal what you'll very quickly see is that the canal is going to back up can't move that many more ships through the canal that are currently going to the west coast so a lot and you've seen that a lot where the bottleneck just moves for a while last summer the for example the trains that were going into chicago they were really having a hard time staffing the railroads out there and it was taking them a long time to unload containers at the port at the terminals inland in chicago and drivers a lot of the truck drivers are owner operators so these are entrepreneurs who own their own truck work for themselves and they were able pre-pandemic to do three loads per day at the chicago rail heads go drop it off come back get another one three times with the delays and the traffic jams that resulted they were only able to do one a day and so you opt out because you can go drive for ups or fedex or take your truck and do something else so we had this huge reduction in drivers and that's the kind of a feedback loop that we should all be really mindful of here where a problem begets more problems and you get these positive feedback loops in the system that really vicious cycles and so you know bottlenecks move and you'll see as soon as they if everybody started to ship to houston guess what houston port won't be able to handle the volumes either it's not like it's magically better just because it's a republican state or something do we need more ports or do we just need to run them more efficiently and then who determines who runs the port because i know that they i've seen some tweets of yours where they license the government i guess own supports but they license it to people to have the franchise there more ports better run ports and then what's the business model of ports i'd say better run ports is the answer i don't think we need more ports uh you can't really create ports out of thin air like there's only a handful of geographic locations that actually make sense for report um and we have we have great geography like the san francisco bay like this is probably the best natural harbor in the world or one of them and the oakland port is perfectly fine it's who owns it is the city of oakland or the city of long beach the city of l.a so the local cities own the ports in the united states that is a difference between united states and europe for example where there's sort of national strategic assets they're still government-owned but it can be operated as a sort of public good for everybody instead of what are the odds given what's going on in oakland that that's the big priority of the mayor of oakland to like run a better port like she's got a lot of other things on her on her list and so that's one problem with our system and then second they do rent it so the government owns it and then rents it to a private company that operates it and then but those as a condition of renting the port you must agree to hire the ilwu so you can't run a non-union port in the united states should the government buy the federal government buy the port from oakland buy the port from long beach offer them some you know trillion dollars or billions of dollars and buy it out from them it's not a terrible idea i mean as long as you're forcing everyone to use union labor it's not really like a private sector endeavors it's like you can't especially with the way that the unions run so you can't do that much but like here's an example where technology could flexport already made this technology we could 10x the throughput of one of these ports overnight which is today a truck driver shows up looking for a specific container he's like i got this container number so they have to make an appointment at that hour and as i said they're missing 50 of their appointments well on the back end inside the port they gotta go find that container in this in the needle in the haystack and make sure it's at the front during that one hour when the guy shows up for it and you could we already have this tech to make it what we call a free flow stack where you just have this the truck pulls up and you give them the first the first container off the line and then the mobile app tells them where to take it and he doesn't have to come for a specific container and if you did that you'd just be every 30 seconds coming out of here instead of every 10 15 minutes you'd easily 10x throughput and this is we already have this tag so uh it's a matter of implementation deployment and how do you get around a lot of people that don't really want to see better running ports and uh it's it's pretty sad to sit where i sit they don't benefit from better running ports although that's the good point although at the back end they they suffer from higher prices and inefficiency and not getting the things they want on time well if you listen to elon talk about unions and why tesla is not a union shop it's got nothing to do with wages you know he said we'll pay you the union rate or better and it's not about mistreatment because he said listen if someone mistreats you we're gonna have a no [ __ ] rule and we'll get rid of them the issue is inflexibility right he wants to drive continuous process improvement at tesla and he can't do that with a union shop because every change has to be negotiated and then if there is a worker who's not living up to the performance bar you can't get rid of them and they can't repurpose workers and have them work a different line so that's why elon has always resisted being a union shop not the wages not mistreatment purely inflexibility and it seems like that's what you're seeing in in the ports as well is we can't drive changes and improvements because everything's so highly contractually negotiated that's my editorial comment ryan what do you think about it i mean it's kind of it's worth studying a little history here is that like you know we went through the container revolution in the 60s and 70s and the union agreed to it and they that dramatically transformed the waterfront these guys like you see photographs from that era they would put it on their back like burlap sacks full of stuff like hauling it on and off these these ships and kind of load them by hand it was a real art and it was a massive employment driver and by the way we've still barely recovered from this like the west side highway in new york is finally like a nice park but it sat there for 50 years like dilapidated piers and ugly ass buildings and some of those are still there san francisco waterfront still mostly like that south of the bay bridge it's still like these old dilapidated buildings so it's kind of funny to see how long it takes like that infrastructure to change but there there was uh and i don't know i'm not like the world's expert on this history but somehow they convinced the union to adopt containerization which is about it's far more radical than anything we would be proposing now in how you would change their workflow or change their work like that was complete change where it's really these giant automated or these giant cranes that replace the worker couldn't biden deploy his commerce secretary or i mean isn't there some cabinet official he could deputize to say go solve this problem go bring the parties together yeah and i think i suspect that'll happen over the coming months because july 1st is pretty bad timing for a midterm election if they were to go on strike and i think he's got a lot of incentive to make sure that he does have the incentive it just seems like i mean you've been tweeting about this for months that nobody's paying attention in the administration i mean we've all been reading your tweet storm saying like someone in washington really should be paying attention to these ideas over two administrations now right ryan it's both administrations have been out to lunch on this they've focused on it the union is a really big issue that's going to come up this summer there's it might be an even bigger issue that's got even less attention which is on january 1st of next year january 1st 2023 which is tomorrow in shipping terms that all the ships in the world will have to reduce their carbon emissions by 13 and these are internal combustion engine is it's not right right ryan ryan hold on a second wait just explain what that means by who's mandating that and how is that enforceable and why is that happen it's a it's uh the international maritime organization it's part of the united nations and it's the group that is overseeing global ocean freight it's the regulatory body for ocean freight in the world and it's the united nations group so any member state of the united nations must follow the rules of the imo and they've all said they will uh and so the imo has said all existing ships in the world must reduce their carbon emissions by 13 and again it's an internal combustion engine we don't know how to make it 13 more carbon efficient or we would have done that already can you actually buy indirect offsets like can you go and buy some amazonian rainforest credits and no you can't offset it uh and it's not about the fleet either so some of these fleets have uh lng liquid natural gas so the fleet might be more efficient but no it's down to the individual ship and it has to so there is one way to reduce the emissions of a ship and that's to go slower uh and if you go 30 percent slower then you can achieve a 13 reduction in reduction in carbon emissions well if you look at it on a per container basis by the way it's the same amount of carbon emitted because the ship is still carrying the same number of containers just go slower but it will reduce the supply of shipping capacity and slow everything down another 30 percent that that takes place january 1st 2023 it's getting very little attention but to my view it's going to be massively disruptive if we slow everything down reduce the capacity of the network that much further prices are going to go to the moon and it's it's like really asinine law because it doesn't actually achieve any carbon reduction the fuel type correct me if i'm wrong is this like mgo mdo like it's dirty or fuel is that correct used in containers this same group imo actually passed a new launch uh january 1st of 2020 and it got totally it was supposed to be a huge deal in our industry and then overhead and we all kind of ignored it but um that eliminated the worst kinds of fuel uh sulfur used to be you could have this bunker fuel that was up to three percent sulfur which led to crazy amounts of sulfuric acid which is like apparently like 15 times worse than carbon as a greenhouse gas and so that was eliminated and now uh it's still kind of ugly bunker fuel but it's not like it used to be the reputation is probably still carried over from from pre-2020 got it if you could wave your magic wand as we wrap up here and change two or three things uh that to you seem like layups and i think you kind of hinted at them in order what would be the changes just based on your intuition and your knowledge of the supply chain what two or three things are the layups we got to do right now i think first off it's got to start with some uh with metrics like what well if you care about something measure it the metric that the government's been using for ocean freight delays has been how many ships are waiting offshore at the port of long beach and this is like one of the most mischievous i don't know if it was just like outright fraud or incompetence but one of the worst things i've seen from a government in terms of pr is they they pass this rule that the ships have to wait 150 miles offshore so that the car so that the uh pollution wouldn't hit la like reasonable good but then they kept using the same metric for how many ships are waiting right outside the port and and it went way down and they started celebrating that success so like let's actually use the right metric which is how long is it taking cargo to transport you can't just hide the ships and celebrate that there's no ships there um if we get the government you're saying that the government pushed the ships beyond the measurement window and then said they don't exist yes basically and the transportation secretary and the port of l.a director got up there this government that's like when i went to an xl sweater to hide my gut and i was like i'm thin yeah look better to look at the scale so if we at least get them focused on the right metric which i think we have the best metric right now we call it the flexport ocean timeliness indicator it's how long is it taking the cargo to from when the factory says it's ready to when it can be delivered now any solution that we create we have a metric we know okay there's a kpi here door door yeah door to door you mentioned the transportation secretary was part of that press conference where they're taking credit for changing the metric so i assume that's buddha judge who's in charge of disbursing the 1.2 trillion dollar infrastructure bill is there any money in the infrastructure bill to solve this problem there's um there's 17 billion dollars allocated to ports i went and read it and i couldn't find any money that was going to be spent on building ports it was like stuff so here's a crazy thing we just had this trillion dollar infrastructure bill that's supposed to modernize and update the infrastructure of the country and it's doing nothing to solve the most pressing supply chain issue in the country which is the bottleneck at the ports which is driving inflation which is causing interest rate increases and wrecking the economy there's a term in in washington which is called a christmas tree bill and the infrastructure bill is an example of that which is this is not a directed shot on goal what this is is a random you know tree that you go and hang little things on top of and eventually the whole thing is covered so it kind of looks beautiful from afar but when you get really close to it it's a little bit chaotic and you don't understand what's going on and so to your point the fact that ryan can say there's 17 billion dollars allocated to something like ports but it's unclear to him who's an expert in the space where that money goes and how it's spent gives us zero chance of figuring this out yeah i mean it was like it's like things like oh each state must create our supply chain readiness report about it's like what are you talking about like singapore put 20 billion dollars to build a badass automated port like that's like a reasonable thing to do like let's spend 20 billion dollars make the most automated amazing port in the world that'd be a good use of government money but like to then create studies and consultants i don't know that any of it's going to hit the ground and shovel right so you're saying you're saying that 17 billion that goes to you know studies and consultants could actually get redirected and we could pick a port where there's an amenable city and actually completely modernize it to set the example of what modern shipping should look like in the united states that at a minimum matches what's happening in the rest of the world yeah i think it'll be pretty awesome and doesn't seem to me like science fiction like the government wants to build a port who's going to stop the government that seems too too logical and too obvious ryan try something else of course compete for who gets to get that 20 billion it'd be the modernized port like as well in competition and see which mayor wants us in their backyard does greg abbott want it does long beach want it does oakland water who wants to fight to be the most modern port that should be santa's once it i'll tell you that descent miami yeah exactly i'm sure the sanchez and greg abbott wanted i don't know that california's two incredible ports wanted and those are the two that are closest to china by the way spoiler alert you guys remember when google fiber ran that competition and they got like mayor of pittsburgh to swim in like a frozen lake and it was awesome right like yeah government yeah please bring us stuff so yeah i think i i i don't have a lot of faith even if that came around it would take five six years right even if it was done right you don't get a port overnight um there are some very simple solutions like this changing the zoning law adopting technology to go with a free metric out of the poor put some metrics in here like have someone focus on this a key part of problem solving is make sure the problem doesn't get worse so let's assign someone to go work with the union and the and the company terminal operators make sure that they don't go on strike and make sure and then someone needs to go look at this imo u.n thing and figure out if the united states is really going to go through with that because it's pretty crazy well listen ryan you've been incredibly generous with your knowledge and incredible your leadership watching you as uh you know uh a ceo and a leader go out there on a boat and go visit and buy the freaking tacos and actually boots on the ground figure this out like the country owes you a debt the world owes you a debt to to really keep this uh you know problem down to first principles and figure it out and our government should be taking notes and really the other leaders who are importing whether it's apple or tesla you know it'd be great for all of them to be supporting you i don't know if they've reached out but maybe the you know a half dozen of you can then sit with this administration and the next one and just tell them where to point the money cannon well because it doesn't seem like they know where you're appointed we have a lot of people in washington that listen to this pod please yes just reach out to ryan just reach out to ryan and have a lunch please just sit there and please just go for these let ryan buy you a taco guys ryan bring your taco truck to washington one of the big common denominators of both business and politics is that leaders have to focus on the right problems and when they're not focusing the right problems like bad things happen and you know we know that inflation is a huge problem the fed now is raising rates or projecting raising rates very quickly which is creating it was created a huge market downturn it's a very blunt instrument it could cause a downturn or a recession so that's the big problem and yet there are specific solutions and fixes to the inflation problem by updating or modernizing the ports that ryan suggested but who's focusing on it and now they'd be more strategic right sax there'd be a more strategic sniper shot as opposed to this blunt instrument right exactly so you know and and so what have they been focusing in washington on definitely not this you know absolutely and then i see ryan posted suggestions on twitter and then all these people come in and they're all like fatalistic oh well the president can't do anything you know first the president can emergency uh war time if there was ever a time for presidential leadership this would be it what i worry about is that if you're the union leader and you know that you've got biden in the white house who's always going to take their side why won't you make your demands more unreasonable yeah they should be asking for triple time to keep it open overnight why wouldn't they do you really if you're the leader of that union do you know gonna break your strike no way no way ask for quadruple time yeah just make it painful you should make the most of the crisis egregious ask possible i mean that this is your max leverage right now max leverage never waste a crisis yeah this is your time all right man listen ryan thanks a lot um great thank you for the appearance it's my pleasure i'm a big fan of the show so being at besties it means a lot to me so thanks guys and we'll uh continue the discussion perhaps at the all-in summit in may exactly see miami facebook stock has dropped over 25 after reporting negative user growth for the first time and not only 10 billion or maybe even 12 million lost a year on their uh ar vr headsets and project but also a 10 billion decrease in projected 2022 revenue thanks to apple's privacy features i guess we've got to go to youtube first well paypal dropped 25 too yeah we have to pay we'll we'll and then snapchat had a whip saw back and forth but chamoth when you see this uh you called this with your spread trade maybe you could walk us through what you saw you know whatever it was three four five months ago and then what you're seeing now and at this level with 250 billion dollars wiped off the market cap what do you what do you think about the future of this as a trade and as a company well i think the trade did what it was supposed to do which is in a period of a lot of volatility i saw an opportunity to you know just reduce my risk exposure look i'm generally long very risky assets right i mean all of us are in the business of building companies that have huge volatility because all of our companies generate earnings very far in the future and so you know in november of last year i was trying to figure out what i could do to shield myself and the reason i wanted to shield myself was because i saw elon and jeff in part selling but also i saw that clearly we were going to go through a period where that high growth tech was going to trade down so i sold some of that high growth tech but then i also wanted to figure out a way where i could be less exposed to some of that volatility by continuing to hold what i had and the best way that i figured out how to do that was to do the spread trade and so you know what i saw at the time was that there is one business above all others that i think is immune amongst big tech from any sort of real long-term issues and that's microsoft and i think david expressed the reason well is that it's an enterprise business now you know politicians generally don't tend to care about enterprise businesses they have enormous longitudinal growth in front of them and they're able to do things on the margins specifically around m a to keep building their business with very little oversight and we saw this because they had the courage to do this activision deal you know just a few weeks ago if you could imagine again no other company in big tech could even dare try to do a 70 billion dollar acquisition because of the scrutiny it was a bold move yes yeah i think it's not a bold move i actually think it says the obvious which is microsoft is beyond the level of regulatory scrutiny that the rest of big tech actually has because they are consumer businesses the second safest company is google and the reason is that google has the best of both worlds they're both a platform because of android but then where they are at risk of being an app they have an incredible deal with apple that blunts that effect and so when apple talks about all their push to privacy you still have this very specific relationship and facebook called it out in their earnings release they said we believe that google has preferential treatment relative to the rest of the internet in that apple deal because they pay apple 15 or 20 billion dollars a year and for people who don't know that's for search the default search on your iphone goes to google google pays 15 billion dollars to apple and the uh accusation explain the accusation there of why that would give them preferential in case people don't if you're paying somebody 15 or 20 billion a year they're less likely to do bad things to you they may do bad things to other people but they're not going to do as many bad things to you did you believe that yeah that allegation from zakia well no i don't believe the allegation but i think that general uh character that general thing is true like you're not going to screw over your partners you're going to screw over other people before you screw over your partners got it whether this applies here it'll have to be borne out in some kind of lawsuit or state ags or blah blah blah but anyways the i think the point is that every other company has a lot more headwinds than microsoft and google in big tech and then the third thing is was a market observation from gavin baker which i thought was incredibly brilliant and what he said was when you see a drawdown meaning when the markets go down it'll affect high growth tech first it ended up touching a bunch of other areas second like biotech but he said this key thing which is big tech will be the last to crack but when they do they are going to get shot and so i spent a bunch of time just trying to figure out when big tech gets cracked who's going to get cracked the hardest and i just kind of wanted to create a spread between those who were the most inoculated to those that were the most at risk as it turned out netflix puked it up facebook puked it up amazon actually got really crushed even though this past day they had a pretty decent rally because of their earnings but they really got crushed so in any event the trade is what the trade is the bigger thing is what is going on at facebook and i think what you see are three really important headwinds that facebook called out explicitly one is that when they talked about usage kind of flattening and starting to decay what they're really talking about is tick-tock and i think what we learned is that tick-tock is an enormous threat and a huge competitive force now in the consumer social app ecosystem the second is that facebook is fundamentally an app that sits inside of an ecosystem that is subject to the rules of the platform owner and that's apple and google and so this idfa change so the change in how you can track advertisers facebook site is going to have a 10 billion dollar impact in 2022 and then the third thing which was more implicit is in order for them to grow if you can't grow organically the only other way to grow is inorganically and unfortunately as we're seeing the regulatory focus on this company is really enormous and so it was a you know it was a pretty watershed moment in i think that company's um discussion of their future and and mark actually kind of said that as much in the in the pres sacks you look at this uh business you made a interesting uh observation facebook rebranding itself as meta before meta exists it may be looked at as another sort of sign that maybe they got a little tilted maybe what was your take on the sort of changing the name of the company before that business really is at scale or exists yeah i mean it's a bubble move um because look when you're in an up market and the market is super frothy we had in hindsight last year was a giant asset bubble funded by all this liquidity coming out of the fed and the federal government so yeah in a bubble like that all investors care about is the growth story and so facebook went all in on this story around metaverse but in the cold light of day you know once the once the position came up yeah once the punchbowl has been taken away and you're in the hangover and you're in sort of a very volatile potential yeah bear market investors go wait a second you know this vr division is losing 10 billion a year it might even be 12 by the way because they said it was a little higher so they lost 6 billion last year they lost 10 billion this year so the losses are escalating and so in that kind of market investors are like wait a second do i do i want to invest in a company that um whose future is that unclear i mean if you look at this at this market we've seen that the growth stocks are down 60 today's an update yesterday was a horrible day so they're bouncing around 60 70 down off the highs in early november okay but the fangs are only down like 14 or something like that right but facebook basically took themselves out of the the sort of the the market leader bucket and put themselves in the growth bucket by basically they treat us like peloton we're speculating why would why would they want to do that you know terrible strategic decision you're saying well it was a it was a decision it was the kind of decision where you look back with 2020 hindsight and you say look that kind of decision could only be made in a bubbly frothy market you would never make that decision in the kind of down market you have today and other decisions look stupid as well so paypal was just down 25 okay why was it down yeah well they just uh well no growth in users it was mostly on the forecast and yeah they revised their forecast down considerably and of course they tried to blame it on the economy but other companies you know amazon just had a huge beat uh relative expectations yeah they're up 15 today so not everybody is um blaming the macroeconomic picture the way that paypal did any event my point is you go back six months ago and you know what was paypal doing i wrote a story for um barry weiss for her sub stack about how paypal was taking the lead in financial d platforming they were working with the adl and the splc to kick to just to identify groups to kick off their platform so that's what management was spending their cycles on figuring out how not to grow how to kick people off their platform and trying to figure out how to get more people on it sounds familiar who else is trying to say it's a platform it's the kind of thing you do when you're in a frothy market and your stock is up and you're triumphant you can waste your management cycles on stuff like that now their stock is down 25 you have to wonder gee do do we wish we had spent our time on other things okay so friedberg i have a question for you about the future uh obviously facebook has bet the farm on meta they're betting on vr and i i guess eventually ar or what collectively is called xr and then we have uh news that apple has a seemingly brilliant goggles product coming out uh developers are getting into it and they are the masters of hardware so now zuckerberg has decided he will be on a collision course with the company that just took 10 billion dollars in revenue from them by doing the non-tracking and that is the masters of hardware so we have this collision course coming and then just two weeks ago google said hey by the way remember that google glass thing we're not giving up on vr ar either and of course microsoft we all know has their uh hololens so when we look at that four horse race if you were to bet and rank who's gonna win apple goggles google glass whatever they're gonna call the new thing hololens and uh metas oculus who's going to win and what do you how do you look at that competition between the big four i don't know if that's a race you want to be in so i like that answer race to nowhere have you guys used the oculus quest device absolutely i have two of them try oh my have you played the games where you like move continuously through space and like when you do that it's like you're gonna throw up you're gonna throw up i mean i'm not sure that this notion that that becomes the new computing modality is like a fair and true notion and so you know there may it may end up becoming kind of a niche entertainment device almost like a nintendo switch where there's a you know a mode when you're using it but i'm not sure it replaces traditional static two-dimensional computing in front of you the jury's still out i don't see like a computer sentiment that says these things will ultimately kind of prevail over the current um mode so you know who's gonna does work who would win in your mind who's got the best chance for me let's assume we're all gonna use it every day for two hours as our desktop we're gonna put it on we're gonna find workout apps to use whatever it's gonna become let's let's assume you know that i think you just answered your own question in in um in all of these things when you build hardware i think you can take a lot of parallels from what happened in the pc space um if you have uh commoditized pc manufacturers compact dell ibm right there innumerable number thousands of companies that made pcs the value created to the application layer to the operating system and the people that can actually build ecosystems are typically the ones that win and the people that already have an ecosystem and all all they have to do is port somebody from you know platform a to platform b has a meaningful advantage over somebody that has to convince you to come to a new platform altogether and so you know if you're a microsoft and you have thousands or hundreds of thousands of developers or if you're google and you have hundreds of thousands of developers or if you're apple and you have millions of developers it's just a smaller bridge to cross in order to convince them to then yeah for one extra endpoint ios versus android you know versus microsoft yeah and by the way it seems like the obvious transition whereas like facebook is like you gotta go build all this stuff and apple made um an incredibly important set of decisions a few years ago which i didn't think a lot of people talked about but they had an os tree that was branching far too widely right they had a different operating system for the phones they had a different operating system for ipads uh desktop for watches and they've started to try to converge and you horn these things into into a set of basic primitives so that it's more controllable and i suspect the reason is because that gives them more optionality to go into a car to go into a headset without having to do an entire developer even better than that chamath is a great point you bring up because they also started investing in their own chipset and i think all of that chipset innovation gives them a dramatic uh advantage in having smaller batteries and more processing power in a headset if it does work which what chips does what chip asset does facebook have none so i don't i don't think we should say that facebook is down and out but let's just qualify what we think can win so that's one thing the other thing to remember is when you look at the pc industry how did intel become so dominant part of what intel was able to do to out compete amd and everybody else was that program called intel inside which is effectively these co-marketing pass-through dollars that they would use to actually give an incentive for dell and for compact and for all these other folks to basically build the spec and that was the wintel monopoly right microsoft and intel if you play that out in vr what you really need is just a bag full of cash because if you give developers a subsidized incentive to build for your platform they'll do it so then again if you rank the companies you just need to look at how much cash do they have because those with the most cash so again i think the best way to think about this is how many developers do you have today how much cash do you have today how much cash will you have in the future and you can probably rank and just do a reasonable expected value to think about who has the best chance of winning assuming the platform is roughly equal now if the if the if if the company on that list with the fewest developers and the lease money has a superior device if that device is superior enough they can overcome those things right and facebook has the least money and facebook has the least if you have rough parody i think the person with the most uh money and the most developers saks uh facebook has the least developers they have no relationship with developers in fact they kind of screwed them over with facebook connect a couple times they have the least money but they do have the largest user base of profiles so does that give them some advantage here and how would you rank who's going to win who's going to lose well i think it gives them an advantage in to chamas framework of porting over their app onto whatever the you know dominant platform is going to be but probably it's the operating system players who are probably going to be able to extend their operating system into this new you know vr ar world probably what i wonder about is would facebook have been better off if they're going to run a 10 billion dollar a year money losing division that's highly speculative would they be better off gambling that on building their own phone or maybe their own like forked version of an android phone with that and and the reason why i say that is the project that i started they're losing 10 billion a year now because of this one permissions change that apple has made right because they're completely dependent on apple's operating system for a big portion of their revenue so what is their defense against that i mean they're really pretty helpless if you look just to make a comparison if you look at the strategic brilliance of google what was it first of all after they came up with this cash cow the idea of search and then they combined it with the sort of keyword auction they got from overture they said that listen the next strategic move is we can't let anybody disintermediate us so what did they do they started moving upstream the first the first sort of upstream player was the portal right so they started competing against yahoo they gave away gmail then it was the browser so it was microsoft explorer so they gave away chrome then it was the operating system they gave away androids they said we're not going to let anybody else be upstream of us and so they just started replacing all those layers of the stack giving away free products with free effects right yeah sorry and a good free product yeah great i mean they all have billions of users also say a big part of the monetization lock-in was google then extended into the publishers very quickly with the acquisition of adsense and the publishers then allowed google to offer the greatest cpm that those publishers could have over any other advertising network and as a result google built their network and then built their advertiser base and they effectively you know got this huge lock-in the only disruptive threat to google was what facebook did which is to create demographic profiles where instead of targeting ads based on keyword or search intent you could now target ads based on demographic and then facebook took it a step further and did uh retargeting so basically following you across multiple sites but facebook always knew and as we just discovered that was always going to be a weak point for them because they were dependent upon hardware devices that we're going to let them do that tracking across apps and across sites and that's why google always had this kind of key you know lock-in advantage that you know will persist and the network is just so big on both sides you can't compete to sacs's thought bomb if they had invested in a phone uh let's say they made a thousand dollar let's say they made a phone with a bomb of eight hundred dollars did this by the way just remember the fire tv the fire truck and he gave a bunch of great speeches you can watch these and what happened with that and just you know despite his extraordinarily large user base his committed loyal users all these reasons his magical talented technical team he hired the best people he also tried to do the same with search by the way with a9 and remember apple also tried to do the same with search all these guys tried to kind of compete it's not easy to execute yeah it's not easy to execute and you get a lock in with the network value but you also get a lock in with the talent and you know this was a really hard thing to pull off and you have to get it all right so let me ask jamat the question based on what sac said could should they have deployed 10 billion into phones if we go back two years and they did deploy 10 billion into phones they take an 800 bomb which is probably what the best iphone cost i think it costs 700 for apple to make and they sell it for 1500 they could basically give the phone away for half price maybe give it away for four or five hundred dollars that's what fire phone was and if they gave away for 400 and you had to be a facebook user you buy it they get the credit card of the person that would be they could put 25 million phones into the market every year so you don't think it would work it didn't create a better user experience for users users got a better experience with the iphone okay and then they got a better experience with android the window of time was in 2009 10 and 11 when there wasn't lock-in and you know i think that's look that's been well discussed about what we were doing and what we tried to do so there's no point rehashing but why did facebook give that up because there was an initiative right it was it wasn't that it was it came down to you know uh an ask that i made that we didn't get and it didn't happen so it didn't happen we'll leave it at that yeah i'm not saying that would have been successful neither died we didn't get to the starting line so we'll never know in fact i think it's unlikely that it would have worked because i'm not sure exactly what facebook's value prop would have been my point is just if you're going to lose 10 billion dollars a year on a division wouldn't it be better for it to be something strategically vital as opposed to something that feels a little bit optional even if the majority chances you don't win the question is if you had a 20 30 35 chance of being a player in smartphones would you take that chance and i think you have no choice but to take that chance that it would be worth it the expected value yeah one thing i'll say in defense of facebook is i think that all of this like antitrust scrutiny is a little bit ridiculous today um and it looks pretty ridiculous and let me just explain why like uh it seems that capitalism is pretty much working as intended because if you looked at google's results if you looked at snaps results at pinterest's results at amazon's results there is a vibrant and growing advertising ecosystem by no means could you claim that facebook has any real monopoly on that number one and and when you fold in tick tock it's absolutely true and then if you think about the usage curve of tick tock there's a check and balance there on usage and so anybody that thinks that facebook is a monopoly today i think is a little misguided so really i think what politicians need to do to today you know february 4th is be a little bit more honest about what they really care about which is really around section 230 and the misinformation disinformation fears that they have related to facebook's distribution power because now if you're going to try to legislate this company it's really unfair like especially going back 10 years to litigate an acquisition you'd never do that to any other company that you know is sort of maybe on the back half of their growth cycle it just doesn't make any sense it would be like going after google now for the youtube activities supported 31 billion of advertising revenue crazy there is a vibrant diverse advertising ecosystem facebook is not in control of that ecosystem and so trying to legislate them as a monopoly in that ecosystem is insane today what do you think saks do you think this regulation is uh based on the fact that facebook kicked off trump and is scaring politicians over actual competitive reality i think that politicians are using the threat of regulation to try and drive the uh the speech policies they want on these social networks that's what's really going on i mean the merits yeah so you agree with me it has nothing to do with the business yeah look who should get regulated on ancient trust grounds apple you know apple is that and maybe google i mean well they're the big monopolists i mean they control the operating system i mean those guys percent of search and i would say amazon with respect to uh the verticals where they're competing with their own uh with the basic exactly so in other words when you control an operating system and then there's um developers or other you know uh downstream players on that you have to treat them fairly you can't privilege your own policy to then dominate vertical after vertical so yeah there are real anti-trust concerns with those three companies the facebook way less so and yet they get the brunt of the attacks why because the people in washington are trying to coerce facebook into controlling what they call misinformation which is really just speech they don't like and that is highly inappropriate perfect segway uh last week we we didn't jump into the rogue and spotify debate maybe we should have but we'll talk about it now with a lot more context obviously neil young and some other folks that were pulling our music off joni mitch or whatever some actual high profile blogger said they don't want to be on there and then joe rogan and daniel ek both decided to talk about this joe rogan said listen i'm a comedian i don't prepare for these interviews uh and i just see where they go but this show has gotten very influential it's the number one podcast in the world it's got a ridiculous listenership so maybe i should right now have it right now maybe i should have it labeled uh me and his and maybe i should have people on afterwards and maybe i should do some extra fact checking i thought it was the best non-apology you know explainology of an apology because he did say i'm sorry if you don't like it um but he did kind of say that he would do better and then daniel x said and then i'll let you guys comment uh daniel x said listen we produce shows and we approve guests for the ringer and for gimlet which we own those studios we license joe rogan we don't uh do any editing on his show and we will remove ones after the fact but it's a licensing they'll therefore we're not a publisher i'm curious what you thought friedberg on the non-apology and culpability for someone like joe rogan having guests on who are anti-vaxx or you know maybe are debatable in terms of science because yeah he is a comedian but as he says like the show is kind of big now so maybe i should do a little fact checking what do you think he should do when he has scientists and uh people and people on i'll make two points one is i don't think that uh journalism is regulated uh in the sense that you know we have freedom of speech so anyone can stand up and they can say i have this belief or i have discovered this fact and um you may not actually hold that belief and that fact may not be true but you're still allowed to stand up and say it and you're so allowed to have someone come on and say it um and so i don't think that there's any disclosure obligation he's putting on a show it's the same as any news show or entertainment show i don't think that there's a clear line or boundary i mean what the heck do we do here we've all got opinions we try and talk about the news we talk about our perspectives on the future you know what the heck is is it that we're doing here you know there's no kind of clear line there so i don't think that he has any obligations do anything he doesn't want to do except if and when his audience tells him or the listeners that he cares about tell him his customers tell him this is what we expect and want from you and then he responds to his customers that's the way the market works and that's the way the enterprise system should work i think the separate bigger question here that's really important and worth noting you know and i just want to speak about this for one second all of the great internet companies started with this notion that they were creating democratization that they were creating access to information that didn't exist whether it's access to media or access to search results or access to content or whatever that may not have been available to you and that was a driving force for the entrepreneurs and the founders that started all these businesses and all of them had these very idealistic points of view that we're not going to censor we're not going to take a point of view we're not going to put our foot down and say what is and isn't going to be displayed or shown or made available to our users we're going to let users choose what they want to get access to and what they want to hear and listen to and in all these cases from google to youtube to twitter and now to spotify the idea of being just an access a platform for access is proving to be wrong all of them are de facto publishers they ultimately have to make decisions about what they do and don't let on the platform and de facto if you let something on the platform you're giving it permission you're giving it a voice you're giving an amplification and you're giving it access and so all of them are now getting caught up in this problem that i don't think anyone from larry or sergey or um jack dorsey or daniel eck ever wanted to be in they all wanted to be these democratization platforms and now they're finding that there is no way to avoid being treated like a publisher and a publisher has someone that's called an editor and an editor decides what is and isn't put on that publishing platform as has always been the case in old media and now in new media they're all kind of stumbling into this problem and they're not set up for it and it's creating issues where people on the right are saying you're censoring us and people on the left are saying you're not giving us access to information we want and it's you know it's just kind of the the i think the transition that none of them expected but we're all seeing happen chamath if daniel lack is giving a hundred million dollars to joe rogan can he claim listen it's just we're a platform when you know listen we're on spotify as well but they don't pay us doesn't it change the relationship when they give him the hundred million or can daniel say you know intellectually honestly like hey listen we're not responsible for this i mean they're backing up the brinks truck uh and they're promoting it like heck are they a publisher or not in your mind i read um yesterday that uh barack and michelle obama's deal with spotify just expired and they're going to shop it i suspect that somebody will pay them tens of millions of dollars to produce content that's not illegal and it's a sign of a free market that's working spotify has a business to run and that business is to get content in front of the users that are paying them a lot of money on a monthly basis to get access to that stuff and so who are we to say how spotify should run their business i think you have a choice neil young expressed his choice there was a person in the new york times she took her podcast off of spotify yep there are subscribers that probably left but then there are also subscribers that probably joined yep and paid yeah and paid and so the reality is that's the free market being allowed to choose and being allowed to vote with their feet and i think that all sides of that are in the right so i think spotify should be allowed to run their business i think joe rogan should be allowed to say what he wants if spotify chooses to put a disclaimer in front of that podcast that's their right and that's good too and if joe rogan decides that he wants to have you know point counterpoint across podcasts or within a podcast that's laudable as well and that should be his decision but i don't think people should be forced to make these decisions by law because i think we get into a very slippery slope because you don't totally understand the incentives of the lawmaker there and we have a free market as you're pointing out shamat the free market is worth working perfectly and more a lot people don't like this free market more important in the free market we have a founding document of principles that we all agree to yes yeah and unfortunately there's a lot of people who don't agree with that says we have a right you're talking about so here we go let's go to our constitutional attorney counselor take us there if you're talking about the principle of free speech there's a lot of people who don't believe in it that's the problem first of all you have this geriatric hippie whoa whoa whoa this jerry can i finish let me finish my rant jacob then you can get it okay we got this geriatric hit i love neil young no you know what happened here wait sorry saks just there that was j cal saying oh [ __ ] he's going to get a bell cluster clip and he got tilted oh my god he had to interrupt you there that's really brutal jake that's about that i thought you were talking i thought you were talking about uh joe biden can i explain actually explain what happened because i think frankly you guys are completely missing it the wheel of censorship broke on joe rogan this week they try to alex jones him and it failed okay first you have this geriatric hippie neil young who somehow has turned into a narc and he plants a flag and he tries to get all these people behind him and the very online crowd says yes we gotta cancel rogan and then you got jen pasake from the white house weighing in bringing the coercive power of the administration on the side of censorship okay and what happens rogan comes out with this non-apology like you said and he seems so reasonable he's a guy who's inquisitive he's on the side of just asking questions he's on the side of balance he says yeah look i want to present both sides of the issue and everybody was like there is no reason to be censoring this guy rogan is an everyman and if they would censor him they would censor every man and that is why there was an enormous backlash to it and everybody has opposed this and so i think this is the week that this ridiculous idea of censorship has broke now it would be nice if everybody to jamaa's point did agree with this principle but they don't the fact of the matter is j cal that censorship is now the official position of the democrat party and you see it in the poll numbers there was a great tweet that glenn greenwald glenn greenwald posted where he showed the polling numbers on this so okay you go back to the days of the obama administration both democrats and republicans agreed that the u.s government and tech companies should not get involved in this type of censorship but today there's been a bifurcation democrats or lean democrats versus republicans or lean republicans it's 65 28 in favor of government taking steps to restrict info online and at 76.37 democrats first republicans on tech companies so blockers the first amendment is no longer longer a consensus and that is fundamentally the issue scary but i gotta tell you i think there is a backlash against this and i think that most of the country now and i i think this is where they went too far is that rogan is not alex jones he's not trump he's not milo yiannopoulos he seems like a reasonable guy he is the biggest figure in independent journalism he gets 11 million viewers every week and i think there's a lot of people especially young people who are going this has gone too far and by the way i do not think obama ever would have made this political blunder of effectively denouncing rogan because obama tried to appeal to young voters and i think jen pasake by putting the administration on the side of the censorship they've made a huge mistake and the same week we saw that tucker carlson now gets more young democrats listening to his show then cnn and msnbc and i'm telling you this is the reason why okay henry you can put in the roaring crowd of applause at this point the best the best i'm telling you jacob you got big problems there are now more tucker democrats okay among the key young demographic in your writer's room tucker's writer room which one i'm a tucker democrat jacob you're a tucker you are you love you love obama you love clinton i think what's happening is that i mean and chamath you've said this over and over again chamom i'm sorry you had on one side you know the the right when lost their mind in the alt-right now they've come a little bit more center and then you now have the the democrats have lost their minds the fact that anybody can't look at joe rogan and say he's a comedian he worked on a show where they fed people shakes of blended insects feel fracture and he's taking mushrooms and he's like why are you taking me so seriously well wait i think you understand hold on i think you're being super dismissive of joe rogan i think he's actually as sack said a pretty reasonable curious person and then yeah he does the stuff that he doesn't prepare for the show he literally said i don't prepare for the show i don't do anything maybe he does or maybe he doesn't know he said explicitly he doesn't and he fact checks in real time so you got to keep your expectation at a certain level with joe rogan i think i i i think that that's implausible to believe i know that that's what he said but you know 11 million people a week 100 million dollar deal i do suspect that he does some sort of preparation i don't think he's a he's completely winging it okay he literally said he wings it but okay i understand that but i think that's not the point okay okay the point is whether he prepares or not the excuses and sorry the dog ate my homework it's hey listen i have a right to have this guy on my show just like i have the right to have this other guy on my show you can listen to both and then you can decide for yourself you could change the channel okay that's the important point so jason i would not like try to make this whole arguing about whether he was prepared or unprepared as the excuse it's whether you believe there's a fundamental right to free speech or whether you believe that people who disagree can disavow people and get them canceled and get them kicked off yeah i obviously don't agree i don't agree anybody should be canceled i think he should keep going whatever rogan's level of preparation which i think is actually pretty high the people who are accusing him of putting out misinformation are far more guilty of it themselves and i think one of the best points in rogan's uh non-polity as you called it is he said listen a lot of the things that we used to consider misinformation are now the truth for we've talked about it on the show yeah well we've been ahead of the curve and calling all this stuff out you know we could have been accused of misinformation so examples the lab leak theory you speak consumers information cloth masks not doing anything listen dan bongino was kicked off youtube two weeks before the cds first saying that clock dan bongino he's a pretty big conservative commentator okay he's got an audience of millions you can be dismissive but a lot of people like him yeah j-cal but look my point is he was kicked off youtube for saying classmates don't work then the cdc comes out two weeks later and says the same thing right i think that's a valid point yeah well it's the key point i personally like you know for example we've talked about this thing where like if you look at like the top distributed links on facebook who do you see ben shapiro dan bongino you know breitbart rogan right yeah my takeaway with all of these things is there are people of those things if i listen to i'd probably find abhorrent but there are people there that are probably i would be you know i would i would i would they would appeal to me in all cases they should all exist though because the whole point is let me spider my way through this stuff and figure out for myself yeah what works and what doesn't work yeah more speech is the best counter the summary of this that makes the most sense is um elon tweeted this out nick you can put this because i gave you the image but it's it's a meme of neil young where it says if you won't censor the guy i don't like i won't let you listen to keep on rocking in a free world yeah and and it's and it's just so true which is like on the one hand you know you are a standard bearer now maybe what we should really do is talk about what has happened to this boomer generation over the last 50 years where they were you know uh sex drugs rock and roll no war in vietnam let's fight for our rights let's fight for equality then punk rock yeah you know no i'm talking about just those those folks back then who are now 50 years later you know sitting on 70 trillion dollars of wealth and who are basically like you can't say this you can't say that don't do this don't do that wear masks don't leave your house you know yeah vouching is right they're scared yeah you know this is i mean that generation i think we all have some soul searching to do about what happened to that generation i think they're scared because they're old and they and they feel like they're going to die from coke is it that generation or is it the fact that every generation rebels against the prior and ultimately becomes conservative and you know that's the that's just how life goes i don't i don't think they become conservative i think they've become authoritarian what happened is they're now in power the boomers are in power they've been making the decisions for last 20 years i think there is enormous popular discontent with the way the country's been run over the last two decades the futile pointless wars in the middle east the debt the economy the unfairness that it goes on and on and what and especially with covet i mean this coveted policy over the last two years has been a fiasco and the point of this censorship of misinformation is to suppress the debate i mean what ultimately is the point on take for example covet of saying that people cannot take a point of view it is to stifle the debate that's to prevent an honest debate on these issues and that people have an interest in doing that are the people who are in charge and are failing and if you gave people the information they'd be voted out of office if you look when i asked what are the specific claims that either joe rogan or his guest made that people are objecting to a lot of the people who were objecting and wanted him censored really didn't know and one of them was he said early on i don't know for a young person who's in shape if i would advise them to take the vaccine i know a lot of people who have that position which is like if you're young and i think actually freeberg you might have said mrna early on in this podcast it's a very new technology and i could see people wanting to wait and see did you not say that i don't want to get you cancelled here but i i think we did have that discussion not have that conversation that's a valid conversation mrna is a new technology right freeberg you should think about it and we should be cautious don't draw me into your cancel that's why i said we i just changed it to we were talking about that don't you remember that discussion we had like when i asked you i think mrna what do you think of this versus the regular one the j and j i think generally we've seen um science being used as a way as a term uh to discredit what i think would arguably and typically be scientific principles which is inquiry challenging hypotheses and having you know vigorous debate uh to resolve to some sort of objective truth otherwise you're having some sort of subjective belief and more often than not we've seen politicians and others grab on to the term science and saying this is science it says this when in fact the process of science is inquiry and it is to challenge you know again a hypothesis and and what might be kind of a thesis so um so yeah i think generally this has been a pretty scary time to watch because it's almost like gaslight lighting you know it's like hey you know you're using the term science to discredit the notion of science uh it's been pretty brutal i sent you guys this this uh cartoon link by the way it's so funny oh i just got it old left versus the modern left it's a volkswagen uh bus with a bunch of hippie dippy flowers and it says free speech free love 1971. no cia screw the establishment resist authority and then it shows like a modern suv with 2021 it says masks up i heart the cdc obey the establishment no free speech do what you're told obey basically you have another poll you want to share sex well yeah this is a really interesting one it says a majority of voters 55 saykovic should be treated as an endemic disease while a majority of democrats say it should be continue to be treated as an emergency and then there was a similar poll the monmouth poll just came out where 89 percent of republicans 71 percent of of independents say that it's time we accept we accept covetous is here to say we need to uh get on with our lives only 40 sharks are democrats so the reality is that the rest of the country i think has moved on it's ready to move on the split is not between democrats republicans anymore it's within the democratic party the democratic party is now divided on this question of whether we should move on as a country pass covet half of the democratic party still believes that kovitch should be treated as this emergency do you think that it's cut by age do you think there's a bias but for sure for sure i think yes absolutely people are more scared yeah but i think i think the media and the party they've programmed their soldiers to be you know to treat covetous emergency and they can't deprogram them and this is why i think we're seeing tucker's tucker is now the biggest demographic among young democrats that's insane to me it's insane the idea that idea is insane this does not bode well for the on top of everything else is happening in the country this is not bode well for the democrats in november and then you had this crazy thing at the um you know the magic johnson party at that uh that was the best held my breath i took a picture of magic johnson i held my breath so i wouldn't get the virus with garcetti and and newsome news and claims it's been you i didn't inhale yeah exactly and then says that he was only photographed at the exact moment where he took off his mask for two seconds you know you know what i if you go to the ski slopes there is nobody with a mask on and nobody's enforcing it and no restaurants and this is in democratic country everybody has moved on at this point everybody's willing to but why haven't they why haven't why haven't they do something politician because they're very signaling and they want to keep power i don't know you tell me that's that's that's the point well i think they're dumb they should take the position but wouldn't take in the reopening position get you more voters at this point people are tired of this they want to move on it doesn't make any sense they're making a bad political decision to their base that's the point is i think i think the whole country has moved on even most democrats have moved on but the democratic base has not moved on and that is why you know newsome and and garcity have to pay lip service to this well i mean and these guys have been telling everybody gotta wear a mask gotta wear a mask and they're not wearing masks and let's face it they weren't wearing masks at uh the french laundry they have never worn masks they've been throwing their own parties with no masks a bunch of hypocrites a whole lot of them all right in other news xi jinping and putin got together and they're apparently besties here's the quote some actors representing but the minority on the international scale i think that's us continue to advocate unilateral approaches to addressing international issues and resort to force they interfere in the internal affairs of other states infringing their legitimate rights and interest and incite contradictions differences and confrontation uh the statement said i am willing to work with president vladimir putin to plan a blueprint and guide the direction of sino-russian relations under new historical conditions mr xi said he added that china and russia should act like big countries as they intensify coordination on fighting the coronavirus pandemic yadda yadda any uh feedback from our squad i mean you could have rewritten that press release as you know we will uh we want to try to destroy u.s hegemony and replace it with ourselves this is the beginning of the end of u.s cultural and economic influence globally or dominance rather influence it uh globally and i think that it's uh you know something that we've talked about quite a lot you know i mentioned in in the prediction episode that i thought that putin was going to play a major role this year and um and you know he's clearly not just you know out for his own interests but he's going to play a really important role in china's rise to economic and cultural dominance you agree chamath is this uh the sign that they're going to be running the show or does this look like something else to you no no i don't think that there's a show to run i think the point is that there was um a first among equals for the last many decades in the world order where you know america was it was that first among equals and i think what they're saying is that it's time for that to change and and and they're gonna tie that to their ability to influence uh foreign policy in countries the way that we have historically so you know this is sort of basically putting a marker on the table that says this is going to be about um you know a different cohort of people that are also going to have an equal say and if you think about where this all plays out it's always in economics right and this is where again you have to think about what china has done which is they have while we were fighting wars you know putting trillions of dollars into the middle east they took their trillion dollars and bought resources all through africa yep right they built infrastructure they bought infrastructure all through south america they put infrastructure all through southeast asia you know that say call it 15 trillion dollars that we spent in one direction they spent another that's a 30 trillion dollar gap that's going to create a resource imbalance that they will use to create even more influence in the future and we have to figure out a way to counteract that sax what do you think is this uh a changing moment in the world order should we be worried that these two uh dictators are going to act in unison and then maybe one gets the ukraine one gets taiwan is this like really earth-shattering uh news or do you think it's saber-rattling and not that big of a deal well i think it's a dramatic statement and photo that was was put out it was a continuation of what we've seen where they have you know xi and putin have been getting and russia and china they've been getting friendlier and friendlier what saddens me and sort of sickens me as really an american patriot who would like to see the american world order continue is the way that we have blundered uh and created this this type of situation so to jamaa's point first of all we wasted 20 years trying to do nation building in the middle east six we wasted six trillion dollars on that how did china you know lose by not being part of that they benefited they were building belton road while we were you know engaged in this foolish interventions in the middle east and now more recently with putin we've really driven putin into xi's arms because we keep threatening to add ukraine to nato which is not something that's in america's interest if we would just give up on that position or just reaffirm that ukraine should not be a to nato it would enormously help diffuse tensions with russia and by the way your point that these are dictators or natural allies that's not that's not historically been true so during the days of the soviet union you know you had nixon and kissinger make the great opening to mao and china and we were able to cultivate a relationship there because china and russia were natural antagonists and it was a major move in the cold war that we were able to cultivate mao and we did so even though he was a dictator with blood on his hands so russia and china are not natural allies we should be doing a better job of not so thoroughly alienating putin that he is rushing into xi's arms that's the blunder i see here by the way after this um summit they're going to meet with iran there's a tripartite i think access of dictators this is like the legion of doom we need to be playing our cards a lot in a much smarter way yeah they need to play our cards what is the strategy i mean the strategy is look we want the american-led world order to continue but we got to be much more selective about picking and choosing our battles yeah iraq afghanistan syria libya they were huge mistakes and now on top of it what about looking forward to ukraine what's that yeah looking forward like you keep bringing up the past what's the look forward strategy in your mind the look forward strategy i think is to defuse and de-escalate the situation in ukraine exactly the way obama did it which is to recognize that america does not have a vital national interest the way that russia does to reaffirm that the nations of the caucasus that have border disputes with russia ukraine moldova georgia they are not eligible candidates for nato at the present time kick that can down the road by 10 years okay we talked about that last episode taiwan is a much more complicated situation i do think you have a vital national interest there got it okay so two very different situations yeah yeah i think taiwan we have to hold the line yeah we have a responsibility in the united states and i think we're starting to do it so i think there is good news where you know part of the strategic vital interest for taiwan is because they have critical resources that we need and we depend on and specifically those are semi-conductors you know we have now i think allocated you know 50 100 billion dollars of capital of capex across a bunch of companies that have committed to building domestic capability and so we have to make sure we follow through on that that's successful and the reason is that it gives us optionality it allows us to breathe it allows us to actually make rational decisions and be patient in our decision making and i think that's going to be really important over the next 10 or 20 years and so we have to invest in the united states so the the solution to all of these things is we cannot be overly dependent on any one country any one shipping lane any one product any one natural resource you just can't do that anymore we have to be strong at home and we have to build strong relationships with other countries and yeah i i think i think we've got a an operating philosophy here all right listen let's wrap there uh we'll see everybody on the next episode for the dictator chamath pauli hapatia the sultan of science david friedberg and the rain man himself triumphant versus peter thiel in that paypal match great moment david sachs love you boys love you besties rain man david said we open source it to the fans and they've just gone crazy with it [Music] besties [Music] we need to get back [Music]








we had a nice dinner chamoth hosted a little uh and we played a little bit of the cards and there's this new kid there oh big shout out to the co-founder of is there a guy how do you wind up here at the game uh sitting here you know uh having a beautiful dinner with us and he's like well and then chamoth goes and he points to hellmuth hellmuth found a billionaire when hellmuth finds a billionaire what happens he's tied to the hip he has like a billionaire he's a billionaire wrangler hellmuth is like one of those truffle dogs in like you know alba in italy you know you send him out into the woods he forages around he finds it he finds a truffle just digs it out waiting for his owner to show up and pick this little billionaire off the ground hey here's another one look daddy see i found another billionaire hellmuth hellmuth is the most insecure person but he's such a beautiful human being i mean he's a great human it's like it's like the tale of two people he's he really is a walking case of schizophrenia and narcissism just i mean that's jamaat saying that let your winners ride [Music] rain man [Music] david source it to the fans and they've just gone [Music] hey everybody hey everybody welcome to another episode of the all-in podcast with us again the new chairman and majority shareholder of laura piana chamath palihapatiya and the viceroy of veganism do you like my thin cashmere gelate that i'm wearing chile actually do you mean polo no [Music] also with us the viceroy of veganism the sultan of science david friedberg and the regent of the right wing david sachs the viceroy of vegans wow viceroy of vegas it came to me in the shower today i was like you know what he needs a new one i switched my background guys do you like it i just flipped the camera to look the other way just to mix it up a little bit now we can see your chef picking the vegetables in your garden well yeah well before you used to see him pick the herbs yeah because the herbs are on this side but now he's yeah you can see the veggies oh there's the sous chef okay there's the prep chef and there's that chef okay yes everybody showed up today okay great you know you seem to enjoy the food jason every time you go you talk about [ __ ] but you are always eating when you're at my house you're always eating who's the first rsvp after phil he's not just eating he's sending his notes to the kitchen could you just do this a little differently i do give notes i do i do usually positive ones it's like three out of four are positive notes you know when i flew with chamath a few weeks ago the chef made gluten-free nutella crepes with homemade nutella i mean it was like the most extraordinary breakfast experience that nutella has no sugar it's incredible it's basically all protein fat and it's sweetened with monk flour sugar so delicious that they they also kill some albino seals i've not brought a chef on on the plane with me but i think in fairness you're playing it's not that big yeah i mean you've got a small plant in the kitchen i don't know if a cessna 142 can finish it i'm feeling plain shamed i just uh got to business select on southwest so i'm really feeling pretty good about myself right now all right everybody let's get started a lot of topics people want to talk about do you want to start with rogan or the canadian truckers i think rogan probably leads into the truckers no it might in fact lead into the truckers okay so uh we covered rogan and spotify in episode 66 a whole bunch since that time uh a video surfaced on saturday uh with joe rogan repeatedly saying uh well the n-word and uh it's um pretty rough to watch and he uh did a mia copa an apology and overall now spotify has taken down 70 episodes of his podcast you know that's out of over a thousand i thought it was like a hundred and thirteen that's that that's the that's what i saw on twitter there's a hundred and thirteen two maybe seventy had the n word but a hundred oh okay you're correct i i stand corrected 110 have been taken down i was texting with sucks it's like it's like almost six percent of all of his episodes they took down yeah so something like that yeah but not not all of them were because of that lane that's what i'm saying but six percent were taken down six percent taken down in his apology he said uh obviously he was wrong uh to use that word for the decade or so but he pointed out that he did not use it towards a person as a slur but was talking about it more uh in studying or discussing the word versus mentioned is that right is that distinction yeah or use versus quoting yeah so he said it was taken out of context apologized um he also made a uh joke that he immediately said oh my god that's pretty racist i shouldn't have told that joke where he uh compared uh going to see planet of the apes in an all-black theater in philly saying he was in africa on sunday daniel x sent a memo to spotify employees claiming he is not the publisher of the joe rogan show something i completely dispute we'll talk about that in a moment thoughts on the latest brouhaha and do we think that spotify will be able to handle uh this what's seeming it seems to have died down over the last couple of days uh and rogan is now joking about it in his comedy uh uh you know engagements uh small comedy clubs what do you think sax is joe rogan gonna weather the storm is spotify gonna stick with him well okay so as of the last episode of the all-in pod uh they were trying to cancel rogan for misinformation and for the reasons we discussed that basically failed because you know so many of the times something starts with misinformation eventually becomes the truth rogan seemed like a guy who actually just wants to present both sides present a balanced viewpoint in any event that whole attempt to cancel and based on misinformation was fizzling out and then lo and behold this 22 second clip comes out and they escalate the charges to racism if you kind of look at um you know who's behind this clip it's pretty clear that it was a democratic super pac put this together and sort of astro astroturfed it as a viral video this is part of an organized attempt to cancel rogan now as to the merits of the the sort of racism accusation against him i mean look let me say that i don't think anybody especially a public figure should be using this kind of language um you know in this day and age even if you're just sort of quoting something or mentioning it you know he he should have he shouldn't he should have known better um however there are also similar clips that are now circulating of joe biden doing the same thing using this type of like incredibly incendiary language in like a brazen almost off-handed way you've got clips of howard wait wait you're saying brazen and he he said it exactly the same way as joe i would say in a cavalier way he's he's but let me come back so you have you have biden doing it you've got howard stern doing it um so what is the difference i mean the the reality here is that uh we used to in our culture have a distinction between the use of this type of language as an epithet which was never okay or using it you were referencing it you might have been quoting it you might have been quoting a rap song you might have been quoting a dave chappelle routine you might be reading from a book that you might have been telling a story in which somebody else has said it and you're merely trying to relay what happened the rules today are that's not an excuse you can't say it but the truth is that 10 years ago 20 years ago the rules were a little different that's why biden said it that's why howard stern has these episodes and i think it's why rogan had said it and i think it's a little bit disingenuous uh for people to now try and apply the new rules to this old language and they're doing it very selectively because they're not trying to cancel these other people who said these things under the old rules they're trying to cancel rogan so i think what you're seeing here is selective cancellation outrage selective application of these new language rules for the purpose of getting rogan cancelled why for the same reasons we were talking about two weeks ago or last week which is he's an outsider he's an independent voice he bucks the establishment he doesn't present the orthodox view on kovit and that's frankly why they want to cancel him freedberg i'm just looking at the howard stern quote so in 1993 howard stern dressed in blackface and used the n-word in a skit he did uh mimicking ted danson talking about whoopi goldberg something and he said i'll be the first to admit i won't go back and watch those old shows it's like who is that guy but that was my shtick it's what i did and i own it i don't think i got embraced by nazi groups and hate groups they seem to think i was against them too so i think you know saks is probably right i mean howard stern's a very different character today you know i think the question of if howard stern acted that way today would cancel culture kind of mob him the answer is probably yes um but i think it's because uh you know rogan is out here probably picking a bone with everyone you know he's kind of there's there's there's no alignment there's no there's no tribal uh behavior with rogan right he doesn't he he's been pretty public about being very liberal he's been very public about being conservative in some ways and i don't think he kind of aligns himself strongly with anyone and so he's a threat to everyone he's got a huge following and you know he speaks openly and honestly in a way that that is threatening certainly his behavior was inexcusable and has been inexcusable but there are others right and so it's a it's an important question which is why him why now it's also interesting with that ted danson he was dating whoopi goldberg at the time i believe and ted danson was there was a roast of whippy goldberg at the friars club ted danson dressed in blackface i think with which whoopi goldberg was it ted danson dressed him didn't howard and then howard did a send up of that yeah anyway the point is the more the the standard has changed significantly less than chamath chime in my book of the year last year was this book wanting by this uh author luke burgess um he wrote something on sub stack i'll i'll send you guys a link you can put it in here but he said he said the following he said as we regress to a superstitious quasi-pagan world of witch-burning civil discourse will be replaced with superstition and scapegoating and he was talking about rogan i think that the the thing that i was the most proud of in this whole thing uh was daniel ek i mean disclosure he's a friend of mine so maybe this is biased however i think that spotify had business principles and this was similar to what brian armstrong did at coinbase i think they stuck to those principles they made a well-reasoned decision that they explained to their employees and shareholders and then they did the most important thing that sachs has always been saying around free speech which was which is more speech and so what spotify said when they explained the decision to not de-platform joe rogan was that they would take the exact equivalent economic value of what they were paying them him 100 million dollars and invested in underrepresented historically underrepresented groups to tell their stories to tell you know to make their music etc and so effectively doubling you know the universe of that kind of content and so i think if if people are really willing to listen i think what we should take away from this is here's a really clear-eyed example of the solution to free speech which is just to get more of it on your platform to have the right disclosures and disclaimers and then for you know people to go along with their lives so that they can then choose and i think that that's um that was the that was the one positive outcome that that i saw from this entire episode the rest of it was uh another attempt at you know uh being morally absolutist and you know scapegoating and then the uh that was before obviously the the n-word thing and then the n-word thing just brought to light that we live in a very different age where the rules have changed and i think the open question is um you know if you're going to judge people for past behaviors on current rules are we allowed to do it selectively or does it apply to everybody and i and i think that you know this is why i think you know we saw people like david simon you know came out and david simon was very um you know basically excoriated joe rogan but then david simon wrote the wire you know and if you if you watch the wire which is a you know an incredible piece of television that people point to all the time is one of probably the greatest shows on television you know every probably you know 13th or 14th word was the n word yeah i have like two observations here though and then i'll get to you saxony or something you want to chime in on i i always like to think about intent and then i like to look at the apology and think is this like sincere or not and when you look at the intent does anybody actually think joe rogan is a racist and i think it's pretty clear he's not from all of the behavior collectively in his life and then you look at the apology i thought i felt it was incredibly sincere uh and there were many learning moments in it and he's a comedian which is kind of this other space where we we ask comedians to make us laugh and make us feel uncomfortable and now we're also asking them to live by a standard that changes every year and and words come on and off the allowable list would anybody hear does anybody here actually think or anybody listening to me think joe rogue is actually racist i think the answer is i don't think anybody thinks that and then number two i i felt the apology was incredibly thoughtful um and well done saks what are your thoughts yeah i mean i agree i agree with those things um nobody was accusing joe rogan of racism until the cancellation mob started throwing stones and the misinformation stones didn't work so then they escalated to racism i think the generalized thing is just take take the context out of rogan for a second i think that the the formula if i can point to this of cancel culture is now i think pretty well understood which is if you don't like somebody you need to throw some ism label on them until that ism label sticks and eventually you will find an ism label but the the thing that this cancel culture doesn't appreciate is everybody has some ism that that can be attached to them yeah now some isms are worse than others obviously but you know we're all infallible right i go back to like if you want to quote the bible right there's a there's a beautiful passage into the bible um the book of john and the whole thing and you guys have heard this quote many times before but let me just give you the setup so in the law of the land back then adultery was illegal but only for the woman right and so there's a very famous example of a woman who's accused of adultery and uh you know she was about to be stoned to death which was essentially the punishment and jesus basically draws a line and says you know he who is without sin should cast that first stone and uh nobody does it de-escalates that conflict and everybody leaves right and there's a very famous essay uh that rene gerard wrote that basically compared that to a different example in a more paganist context where people did stone people the idea of all of this is that there's some amount of you know sin that everybody carries and i think that at some point cancel culture will realize that you have to de-escalate and you have to see through some of this noise you have to have some point of moral resolution to really move on because this sort of like fatalistic judgment doesn't work anymore so whoever people wanted to cancel rogan they must be very frustrated today because for all intents and purposes he got off the hook they may try again in the future with some other ism he may just as well get off the hook in the future right so what the what is the real solution the real solution is to figure out how to de-escalate and actually have a conversation about the things that he's doing that really upset you and that is still not what's happening and a path perhaps to resolution let's get free bergen and then you sex free burger i'll say two things one i i think um i once sat next to tony blair for dinner you know he was the prime minister of the uk and he told me it was a really funny conversation because he was talking about his youth and he's like if there were iphones when i was young i would not have ever been elected to public office like you know um he was in a rock band he i don't know if you guys know his history but you know he was pretty free-wheeling kind of guy and his point was really broader than that it was that you know all of us have something that people can look to us for and use against us in some way but i think what's really important with this joe rogan thing and i think the bigger picture for me dissenting voices and critical voices and outspoken voices are extremely important in the discourse that makes society progress it is not a good society when people that have dissenting of voices or offensive voices are shut down society has a better opportunity to chart a new course and to identify new paths sometimes when the dissenting voice is wrong and sometimes when it is right but in both cases it is important to have that dissenting voice because it allows us to have the dialogue that allows us collectively to figure out what is wrong and what is right and so this notion of cancel culture and the way that people like joe rogan are and have been attacked for things that they have said in the past or do say today um i think is really contrary to the opportunity that the united states presents with this you know founding principle of freedom of speech sex yeah so i agree with that but i want to build on what chamas said with the rene gerard analysis of this i mean what we're seeing here is the modern day equivalent of a primitive you know archaic stoning ritual this is a modern day virtual stoning in which we're not uh killing somebody but we're trying to kill their digital avatar i mean we're basically trying to remove and destroy their online presence i mean that was really the goal here and um and and the mechanics of this thing it it only works to the extent that people are unaware of the um the mechanism of the scapegoating as soon as they become aware that this person's being targeted selectively as a scapegoat it stops working and that was the situation we were in last week where you had you know neil young through the for he cast the first stone despite being guilty of misinformation many times himself he's got like a weird history of saying weird things about gmos and gay people and some of the stuff got dredged back up and and i think that was fair because let he who is without misinformation cast his first stone and then he got some of his friends you know the these aging you know rockers like joni mitchell and uh crosby stills and ash to to throw the next stones and then the media got in on this and cnn and msnbc they were throwing stones and it was all motivated by the fact that rogan is simply does not refuse he refuses to parrot their orthodoxy because you know we can see people like howard stern who i like stern okay but today howard stern's become a full-fledged covet hysteric i mean he is fully on board with the covid restrictions and mandates and hysteria that's why he gets diplomatic immunity to this so this whole the whole scapegoating ritual around rogan was about to fail last week and that's why they escalated it is because they saw first of all rogan was getting away and then second our ability to to run these sorts of like witch hunts if people start to reject that we lose all of our power and so that's why this thing escalated into the most sensitive area that we have in our society this language around race this very hurtful these hurtful epithets and these people are playing games with that with with that type of language and um it's very destructive and but i think people are seeing through it you know i really agree with this i think like the the scapegoating um as a way to resolve things um is losing its effectiveness increasingly it did work online for some amount of time early on and david you're exactly right it's when the mechanism of action was poorly understood but now that everybody sees it and people try to do it all the time it just stops working and it's not nearly as effective anymore it's a burnt out tactic you know we see this and it's like this marketing channel has been over and everybody knows like okay i'm being marketed to uh and to give it some context for those people who are wondering you heard rene gerard like three or four times here he's a philosopher and uh he taught at stanford he had a big impact on peter thiel i don't know if sax actually took any courses with him and there's a book me peter david i mean like if you did you take courses with him i never took any courses but uh peter told me about his ideas in college and i read some of his books yeah his books are incredible i mean he is one of the most uh powerful thinkers uh of this i mean he passed away reminds me of joseph campbell the power of meth like they were really thinking about the the sort of base basic tenets of like human the human condition and how people behave it's really worth double clicking on i think also interesting uh in terms of forgiveness and blackface justin trudeau has appeared no less than three times in his youth in blackface and it's it's not a joke it's literally true justin trudeau like the reason why um the the racism label was planted on rogan is because he's heterodox the reason why that racism label has not yet really been planted on justin trudeau is because he's orthodox he's quite he's quite part of the ingrained establishment he comes from royalty in canada growing up pierre trudeau you know we were we were liberals growing up we were members of the liberal party we'd made donations to the liberal party you know in our lore there is no greater symbol than pierre trudeau his father and so when you're the son of somebody like that you get an enormous amount of um credit in your bank account that you're born with and he was able to burn through so much of it by doing things that anybody else in any other situation may have been judged much more harshly for and he wasn't um and he becomes prime minister and then he's able to get re-elected but you know his day of reckoning reckoning is coming um because he is revealing himself to be a part of this establishment with these views that are actually really uncomfortable and you know quite grotesque because of how judgmental they are of everybody else and that's a great segue and then just finally sacks it correct me if i'm wrong here joe rogan has voted democrat his whole life he holds largely democratic beliefs he's for universal healthcare he's pro-trans he's pro-gay he supported bernie sanders and he was a voting for bernie sanders he's a really stupid person for the democrats for democratic politicians like biden to alienate because he's a hero to young people he's a hero to the working class and his views are fundamentally i'd say more progressive yeah they're 100 progressive yes so it's stupid for them to do this but it's also stupid for them to be alienating these truckers because democrats were supposed to be the part of the working class so let's pivot to that issue can i just say one last thing i just want to reiterate this sax because i just i just want to really give you a chance to say it again you've always said and it's so true the solution to free speech and to protect it is more speech and i just want to say to daniel eck and the team at spotify you guys must have been in a really difficult spot but the decision to take that hundred million dollars to increase the funnel for other voices and historically underrepresented voices is so good and i hope you guys get to the other side of it but i thought it was a really really really good decision yeah i mean so on eck and the spotify decision i mean i won't think to that so i applaud them for not canceling rogue and they must have been under enormous pressure to do so including from their own you know employees the only thing i didn't like in that statement was when he talked about the user safety and how they need to do a better job of user safety that's a concept that doesn't make a lot of sense to me i mean rogan is not sneaking into people's living rooms and turning his show on and pressing play if people don't like it i'm talking about users if users don't like the content they don't have to listen you don't have to click play he's not literally safety yeah but we've still bought into this idea of psychological safety that being confronted with any view you don't like is a threat to your safety that is actually a threat to free speech because it's giving the most hysterical people in our culture the ones who are most prone to being offended a veto over any idea and speech they don't like yeah if you're uncomfortable you're unsafe you could remove yourself from that situation if it's a piece of media you don't need to read every book you don't need to see every quentin tarantino film you don't need to listen to joe oregon or whatever else that you find offensive to you personally i just don't think we should be feeding that idea that that psychological safety is a legitimate idea we talked about this before with like you know people at work if they say they feel unsafe that's instantly like an hr like oh my god you feel unsafe yeah right alert hr comes running over because everybody has a legal requirement if someone's creating a safety issue in the workplace they have a legal requirement to remove that problem that's why this language got started is it triggers the machinery of hr to remove people who are doing nothing wrong as an employee like sax hey listen your work product is not good enough you're like i feel unsafe right okay anyway let's go to the truckers because i think we're beating this stuff i just want to have one final comment on spotify i think da i appreciate what daniel did with 100 million dollars that's great and i think it's great that he's supporting free speech and he's holding his ground there i know that's not easy however i think he's intellectually dishonest saying they're not the publisher of joe rogan i have a three-part test to see if you're a publisher do you pay for the content do you promote it you produce it if you do two or more of those you're a de facto a publisher in my mind they pay a lot of money for joe rogan they promote the heck out of him and while they don't produce it in advance by picking the guests they do have a production-like veto uh on what content they put out there and so if netflix has to own the people they pay uh even if they don't produce it and they promote then spotify does need to have the same standard and disney and netflix all are producers of content nobody would argue that and i believe spotify is the producer daniel's not being honest final thought on this let me just defend spotify for a second okay you guys have been through this i've been through this many times at several of my companies but when you are in the middle of a firestorm it's very rare that you can put out these you know press releases where the pride of authorship is one person and in many ways you have to write these pr releases with all of these guard rails that that think about all of these future issues that may prop up over time and so i understand that you guys had some issues with some of the words i would just say again look at the action and the action is he didn't de-platform someone and then he doubled down on free speech and he actually pointed a hundred million dollar fire hose at people who can now tell their own stories on a platform that is the most important audio platform in the world so i would say you know you know that's kind of like same thing when i said you know i didn't particularly like sometimes you know brian's essay i could have written it better but at the end of the day what i saw through it and i admitted this later the substance of what brian armstrong did was incredibly profound one of the most important things that actually happened in the last few years in silicon valley culture and i would just say that i think that daniel did something really powerful here and i think that both spotify and coinbase deserve and the employees and the leaders there deserve a round of applause i think it was a very very hard decision and i think they stuck to their guns irrespective of what you believe they stuck to their guns canadian truckers are protesting as many of you know vaccine mandates just breaking today ontario's premier has declared a state of emergency for the entire province and ottawa police have braced for thousands of protesters to descend for the third consecutive weekend usa today also reported the convoy could disrupt the super bowl blind state of the union et cetera the protest has been self-titled the freedom convoy and has been underway since january 29th 29th it appears it uh has spanned several thousand vehicles across the country and the truckers are blocking key roadways and bridges including the ambassador bridge uh they're seeking an end to canada's vaccine mandates and it feels like this is now morphing into something a little bit wider than just vaccine mandates maybe it's becoming a occupy wall street type of protest open to many people with many different uh things that they have uh grievances about a reporter from barry weiss's common sense newsletter slash media operation wrote what the truckers want jason you're you you just nailed it um i do think that this is actually occupy wall street 2.0 yeah look it turned out just to get root some facts so it's not just truckers this is a broad-based coalition of people across every single race and gender and age group in canada that's participating in this thing in fact the bari weiss article you know she profiled men women of all ages sikhs you know whites i mean everybody blacks there was so there's a there's a coalition of people second is this really isn't about vaccination rates because it turns out truckers are 90 vaccinated they're vaccinated at a higher percentage than the actual broad-based population of canada which is about 78 i think the the point of this and again i care about this so much as a canadian but i i just want to read a quote from justin trudeau because i think it encapsulates what this is really about the quote is the small fringe minority of people who are on their way to ottawa who are holding unacceptable views that they are expressing do not represent the views of canadians and i think it's that phrase unacceptable views that really points to what the real issue here is which is that there are a lot of people who now say it's been two years enough with mask mandates enough with all of this you know almost police state that's developed all of the emergency use power that politicians have taken let's reclaim our democracy and let's have you know freedom again and under the political viewpoint of the ruling liberal party which by the way is now going into revolt as well a bunch of liberal mps have just completely flipped because of this statement it summarizes what trudeau is saying which is what you believe is unacceptable to me and so now i will quash you or that canada has one viewpoint uh freeberg did any of you guys listen to the new york times daily podcast that our friend sent out the link to this morning yes you know to me these are the same story it was uh actually uh um an interview uh with a reporter who highlighted some work that she had done and identified that phil murphy the the democratic governor of new jersey had done some uh some some polling and some some focus group discussions uh with some of his constituents and the overriding tone was one of emotion one of feeling left out of the life that they believed they should have been living over the past two years and ultimately i think the tone speaks very clearly to what the truckers are saying which is everyone feels more than ever incredible overreach into their personal lives by the government and by different governments whether it's local or federal here in the us or by this canadian government or you know go to australia or the uk and the sentiment seems to be similar everywhere i don't think that any time since world war ii have we seen the government create such restrictions and such mandates in in democratic republics uh like the united states um that we just saw over the past two years and i think the fact that it's continuing when folks are now seeing you know on the ground every day uh you know the mildness of omicron or like you know the big the challenges that their kids are facing in school and you kind of put these things together and you say to yourself why is my government restricting my life and causing the challenge that i'm being forced to face for what and i think that's a tone that everyone feels everywhere in the west today i think in the east it's a little bit different right um uh because of the uh the mindset there but i think here collectivism collectivism and i think here where we pride individual liberty and freedom as kind of the foundation of these democracies to have the government tell us what we have to wear shots we have to put in our arms where we can go and when how we can behave in ways that were never legislated in ways that were never kind of debated and discussed publicly uh just feels overreaching at this point i think everyone's hit their breaking point and this is another one of these examples this trucking thing is another one of these examples of people manifesting their breaking point and sacks to the point we've been discussing over and over again things have changed radically since the beginning of the pandemic you believed in mass mandates early because hey no downside we talked about that and we didn't want hospitals to be overrun which is reasonable you wanted to have oxygen we were all you know trying to make plans for hey how bad is this going to be but we're sitting here two years later and it's pretty clear omicron which i had uh thank you saks um is is a nothing burger as we said here thanks excellent saxacron i helped you is sick when i've been around you yeah i went to sax's party and all i got was an eight thousand dollar gift bag and omicron uh the gift bag's pretty great at sax's parties no i think i think getting omicron helped you because it enabled you to see that this for you was largely a nothing burger and so you could come out of your house and start acting normal i think there's a lot of people all over the country are like you're saying that you haven't left your house for two years do you remember the photos of saks at the beginning of kovit when he was wearing the triple mask and the club well look i supported mass m mandates at the beginning of the pandemic when faulty was telling us mastin work let's let's not forget that um you know i was supporting when the health officials told us they didn't work why because it was the only thing we had we didn't have a date david david come on he was he was doing us a favor by lying to us by his own admission he said i lied to you so that we could preserve these masks for frontline workers well thank you thank you anthony fought one of many one of many noble eyes that he's been telling here we go he's an he's a noble liar he's in right now by may of 2020 i would say my biggest political loser pick from 2020. go on take it easy on your picks i know you want to do your victory lap it's only february you give us until like june for the check-in okay colonel kurtz contains mass we're the main alternative to lockdowns that's the way i saw it in the summer of 2020 and i was saying and these crazy lockdowns just do mass and then once we had the vaccine and all coveted restrictions that was a year ago and now we still have these restrictions a year later and that is what the truckers are rebelling against just like you said these are ordinary people who are sick and tired of having to show their papers and have to deal with these mandates um and um and and for that they've been like absolutely demonized i mean trudeau comes out and says that they're basically white supremacist and racist and homophobic every epithet he can throw at them sorry to your point he used every he did use every ism he really did try to cancel them at first and this is what's really painted him in a corner he went on national tv and he said these people are racist and misogynist that's specifically what he said and it actually turned out that the overwhelming majority of them were not they were just normal ordinary law-abiding canadians who were just fed up with the overreach and then then what happened was the polling said you should bring these convoy leaders in sit them down and talk to them and then the political calculus though was impossible for him because he had already called them racist and misogynist so then how could he bring them in right exactly yeah how do you negotiate with nazis basically so then what he did was he ran out of ottawa so instead of staying in ottawa now he's under uh in a secure location for his city oh my god oh he feels unsafe so trigger warning in fairness uh when you bring 8 000 people together and you get a wide enough group of people there was swat stickers and white confederate flags that were flown so it might have been two of a thousand but that did happen with this game from the protest movement which i just said yes without any protest movement there's always to be a handful of people who go too far and are too extreme but they did not represent the vast vast majority of the people who turned out which are ordinary citizens and trudeau seized on a handful of isolated examples to try and demonize these guys and i think it's blowing up in his face the fact of the matter is the truckers did not start this fight it's the zealotry of our elites of our professional class that started this fight they will not give up on these mandates that's the fundamental problem well and while they go to the super bowl with no mascot i think what you're seeing here with this trucker thing i think it's going to have huge ripple effects because it's showing the schism in the democratic party between the professional elites and the working class here you have the working class remember these were the essential workers these are the people bringing us our food most have already had kovid over the last couple of years they couldn't sit behind a computer and do their job in their pajamas on zoom all day okay so these guys know the reality of covid just like you learned the reality jason when you actually got it and yet we've got this neurotic class of professionals within the democratic party who don't who are these coveted dead enders don't want to give this stuff up and that's the fundamental divide and i think biden's gonna have to choose which side are you on are you on the side of the working class or the professional class trudeau has chosen his side he is the effete elite face of these coveted dead enders and um and bonnie's gonna have to choose who he supports and then those are dwindling you have governors now who are uh democratic governors in many states who are saying listen uh omicron is obviously different and look at the charts look at the data we have to talk about this new york times story on how new jersey and several other these blue states dropped the mass mandates it was absolutely extraordinary i mean it's not extraordinary the risk assessment is different david what was extraordinary about it is that i mean i think it's kind of obvious more than extraordinary if omicron is less deadly it's an upper respiratory doesn't kill people who are vaccinated and most people are vaccinated pretty obviously it's time to pivot and open everything up it sounds like an obvious decision biden really misses moment here so i think you know like free bricks said it was phil murphy he's a democratic governor of new jersey he was supposed to have an easy re-elect win by 20 to 30 points he narrowly squeaks by by two to three points okay so then he conducts the focus groups to find out what do we miss why were we so off on this thing and they find out that people in second tired of these mandates he goes to the white house okay and shows these findings and says guys we have to get off this losing position on covet and the white house sits on his hands and does absolutely nothing so murphy is like we can't wait anymore so he unilaterally goes without white house support this is all in the new york times article this is not like some right-wing publication saying this okay so he unilaterally says okay we're getting rid of the mass mandate okay and then five other states do the same thing because they realize we can't wait anymore and biden is just nowhere to be found and pasaki is saying well we're deferring to the cdc they're deferring to you know rachel wolinski at the cdc and randy why gartner at the teachers unions and these health officials like barbara ferrer and l.a county all of whom are saying we cannot lift these mandates yet they don't want so they are completely on the wrong side of this and then biden really steps in it by saying to trudeau in canada listen you guys got to clear this bridge do whatever you need to do to clear this bridge basically implying that the civil disobedience needs to be met by force and then you've got harvard professors and cnn analysts saying slash their tires take away their trucking licenses starve them out you know so this has been the response and the response to that is now there's a trucker convoy getting started in the u.s and they're going to march on washington they're going to drive to washington great and between now and then biden better figure out what side he's going to be on uh because if he doesn't handle this right i think it's gonna be the end of his presidency peaceful civil disobedience is fine as long as they're not blocking ambulances getting people to and from hospitals that's fine especially the vaccinated is this scranton joe the the the guy who said he would take us back to normalcy the the representative of the working class is that who the president united states is or is he in the trudeau camp the you know the the fouchy and the wilinsky and the referees and easily thank you you're asking a rhetorical question i think that the the polling data makes the answer pretty clear which is that the democratic party is lurching towards establishment insiders and working normal ordinary people have in larger and larger numbers started gravitating towards to the republican party minorities in far larger numbers than we ever expected have started lurching towards the republican party and so the answer is sort of in the polling data and what what the actual facts on the ground have been you know i mean we we forget because we were all so ready to to to cast away our trump derangement syndrome syndrome but he did get i think what was it nine million more people to vote for him in this past yeah the working class whether they're it's the white working class or the non-white working class are moving in huge numbers i think i think i think the margin of non-white working class who moved to the republicans the last election was 18 points they got 18 points more share than eight years ago so the working class regardless of their race is moving towards the republicans while the democrats are becoming this more effete elite professional class party this woke elite party and you know i think biden sort of is caught in the middle of this and i think he's running out of time to try and reestablish that he's gonna have a centrist presidency that does not completely kowtow and defer to the left of his party to this sort of woke elite thinking you know you see democratic political scientists like roy tishera writing about this like every week saying this is your last chance this is your moment to save your presidency i don't know if he's listening okay friedberg we made some great progress in science this week in nuclear fusion do you want to tee this up for us i'm happy to so let me just give a little background for maybe a minute on on fusion so you know the um the way energy is made in the sun and in all stars is through this process of nuclear fusion where hydrogen uh nuclei the protons inside of hydrogen atoms shoot around at such a high energy and they're so dense because of the amount of hydrogen it all causes gravity to pull them all together they get really dense they start slamming into each other when they slam into each other they fuse into helium and ultimately the heavier elements and release energy in the process and that is what fusion is so you know we talk about nuclear energy on earth all nuclear energy that we've generated on earth as a species to date has been through fission where we take much heavier elements like plutonium and uranium and they break apart by squeezing them together and they release energy but this creates radioactive material it's dangerous it's very very expensive and so on so there's always been a question since roughly the 1950s on whether or not we could recreate the conditions of the sun or stars on planet earth by creating a plasma by creating the same sort of plasma that exists inside of stars very hot very fast very dense hydrogen that can slam into itself and slam into atoms and fuse into helium and release energy does that same plasma exist on uranus yeah god you're gonna give him a wedgie let science boy finish oh sorry i'm back to you never gets old was it 69 mega joules or 420 mega joules yeah so plasma fusion's always been this kind of holy grail of energy because if you can actually generate plasma fusion the amount of energy it takes to create the plasma is less than the energy that comes out of the plasma so it's it's effectively positive infinite free cheap plasma and so the the system that people have been building for the last 25 30 years is these uh these donut-shaped systems called tokamax they're they they're like a circle like a donut and they spin the plasma around inside and so it takes a lot of energy and magnets and so on to try and make this work you know it's a company we talked about a few months ago called commonwealth fusion systems which uses a new superconducting material to control that plasma and use instead of using expensive magnets may just raise 1.8 billion dollars and uh you know more recently uh the joint european taurus which is managed by the uh the atomic energy authority in the united kingdom uh just this week demonstrated um energy output uh from their tokamak plasma fusion system where they generated you know 59 megawatts of energy in five seconds uh which is um a record uh the prior record was set in 1997 by that same agency they generated 16 megawatts of power output so it was a great breakthrough and you know to make this all possible has required uh technical breakthroughs in electronics uh technical breakthroughs and sensors and computing and hardware in material science and superconductors and so all of this is starting to coalesce that plasma fusion might actually become a reality and the eye care system which is the biggest construction project in europe 35 nations have contributed a total of roughly 50 to 60 billion dollars to make this system um is is going to go online around 2027 they've been building it for 20 years it's going to be a 500 megawatt demonstration system and if it works then it opens up the door that in the future we may actually be able to turn plasma fusion into an energy source for all of humanity it basically would use water plasma fusion is made from taking hydrogen which you would get from water spinning it around heating it up getting it to be really really dense and ultimately driving power out of it the implications are extraordinary right so over the next few decades it is appearing more likely that we will have plasma fusion systems working on earth and as that happens energy becomes free and it becomes unlimited and with unlimited free energy we can terraform earth right we can take uh ocean water desaline turn it into fresh water we can pump that into deserts turn them into rain forests um you know the total annual production of energy on earth today is about 170 terawatt hours that amount of energy could be generated from just a 10 foot by 10 foot by 10 foot cube of water that's the amount of energy the amount of material that would be turned into photons that would drive all of the electricity we need on earth so it's an incredible technology an incredible breakthrough we're starting to see this stuff happen one area that i wanted to kind of just highlight which no one talks about but which i think is extraordinarily um important about a hundred years from now let's say as these plasma fusion systems work it's certainly going to be true that we'll have abundant free energy during the back half of this century and that'll change everything we'll decarbonize the atmosphere we'll terraform the planet we can make whatever we want we can build things etc but the same system of plasma fusion theoretically could be used to fuse heavier elements than just helium so fast forward 100 or 200 years if we can actually make plasma fusion systems work we could also and to make helium to make energy we could also use them to make heavier elements like the rare earth metals that we talk about being so important here on earth to make um batteries or phosphorus uh which you know we're gonna run out of on planet earth in about 100 years which is a critical component of agriculture and feeding ourselves so you know over the next call at 100 years plasma fusion systems i think back half of this century come online provide us with abundant free energy and then in the 22nd century i think this idea of nucleosynthesis the idea that we can actually make the rare earth or the heavier elements that are limited natural resources here on earth where we could turn water into gold or water into lithium or water into molybdenum or you know into beryllium or whatever um starts to become a reality um and so this to me like i feel like we're on the eve of plasma fusion being a reality you know based on some of the results we're seeing and it's one after the other eye care is going to come online you know commonwealth fusion had their their materials break through and on and on and on so this seems to be building up and so the twentieth and they're gonna hit a tipping point yeah that's right i think the 2030s and the 2040s are where this becomes real and all these problems and concerns we have about climate change and carbon in the atmosphere all of this stuff can be reversed with infinite energy and so so i'm optimistic and i'm i'm excited about a lot of what we're seeing let me ask you one question obviously when people start hearing about nuclear reactors and fission and then they start learning about fusion they immediately have the chernobyls of the world and fukushima's come to mind and nuclear bombs in this case when this reaction occurs my understanding i've interviewed a couple people working on these reactors is that the reaction just fizzles out it just stops and then it's not radioactive so these these are not radioactive materials that naturally decay into radioactive ions or or particles that can damage the body or damage these are literally just hydrogen atoms that are spun around so hot and smashed into each other so if the machine breaks everything just turns off that's it and the output even when it's working my understanding is some natural uh like just air and water so there's no output there's no there's nothing right there's no environment there's nothing to deal with so let me fast forward 200 years so now assume these systems work as you guys know all technology over time gets better faster cheaper smaller so in 200 years we could find that we have plasma fusion reactions in every pocket in every computer in every phone imagine a world where we no longer need batteries where we no longer need transmission lines and where a system can literally pull hydrogen out of the air generate electricity on the fly and it sounds crazy but people thought people would have never thought that the batteries that we put inside of phones would have existed when the first flow cell battery cell was made you know whatever you know during the early days of of chemistry electrical chemistry so you know the idea that we've been able to shrink batteries as we have um the idea that we've been able to make generators like we have today these were concepts that would have been so foreign so i do think that in 200 years if plasma fusion systems work there's nothing about the laws of physics that says they're limited in scale to only being large they theoretically could be reduced down to there's no limit to the size they could drop down to and so there could be a world 200 years from now where plasma fusion reactors exist in every component that needs electricity um and so ultimately you could see putting these these systems on um spaceships and using them to convert elements from one form to another and we could live for you know a hundred thousand years on a spaceship and just recycle the elements on that spaceship to produce all our food and our air and everything and yeah for sure we could get to uranus with that absolutely the summary and back you come back you could circle his anus so that was my diatribe on plasma fusion i'm super excited about some of the processes right now sax is wondering how do we wet our beaks tell us where to place the bet there's nowhere yet this is i mean honestly i don't place bets on things that take a hundred thousand years it's only a hundred years oh hundred years sorry hundred thousand things that might materialize in four years sorry hundred weeks he needs to upgrade his bills are due next month i got bills to pay i got bill a big part of the you know just speaking markets for a second i mentioned to you guys at the end of last year that i made a bet on energy stocks and the reason i made a bet on energy stocks is because some of the breakthroughs that we're seeing in decarbonization and renewable energy has driven a reduction in capital improvements across energy infrastructure because people are so optimistic about what's over the horizon and they're so pessimistic about carbon intensive energy systems that we actually have under invested over the past few years in energy infrastructure that it's turning out today is critically needed so while this is a great long-term kind of optimistic world scenario and it's going to decarbonize energy production and energy systems in the near term we're actually struggling a bit to meet our energy demands and there's a lot of leverage that energy producers have over those that are the consumers as we're seeing currently with the russia ukraine europe crisis and so on and so part of the reason for the climate energy stocks over the last couple of weeks has been largely driven by the fact that we're realizing that this under investment in capex has created a decline in productivity of these assets relative to the demand and so suddenly everyone's like oh my gosh these things are going to be able to charge more commodity prices are going up and so on so you know it's very hard to think about playing an investment cycle around this stuff because in the near term there's still significant demand and we only have carbon intensive systems to produce energy well i was going to yes youtube if does this mean on an investment thesis you might see a massive spike in carbon-based fuel systems and the sovereign wealth funds and then a dramatic drop-off no okay what do you predict will happen the nobody will support anybody investing in pulling more oil out of the ground they'll they'll support trying to get more from what we have um but you know i i don't know if i don't know if you guys saw but you know um there's no support for this whether you're an investor and you go activist on some of these oil companies you know whether you're i think there biden had a big setback because you know he had cleared a whole like millions of acres of offshore land for uh some point some kind of energy extraction that was then just reversed by the courts no no but nobody has support for this stuff but that's but what you're saying is exactly right and it's exactly the reason oil prices are climbing i just sent you guys a link to what's going on today they're but they're climbing for the wrong reason so look let's just be realistic here we you know we have a cartel it's called opec you know uh and what they do is they decide output and we have some balance checks and balances to opec namely russia and a few other actors who will try to then regulate supply and demand so that there's mutually assured destruction the net result of all of that right now is that we do have some constraints apply for the amount that we need to get to get back to the level of production we had pre-pandemic so we are going to have some sustained energy prices but you saw something really important this past week everybody was waiting for this big cpi print right the consumer price index print everybody thought it was going to be a bad number it was a pretty bad number but the markets were pretty responsive to it and um and then it's been pretty responsive the rest of the week despite a whole bunch of stuff i don't know if you guys saw but like yesterday there was this crazy article where you know one of the fed governors was like we should raise by a hundred basis points by july and you know we should do eight eight raises and and the markets were like what are you talking about and why is that because now people have started to look you know i've mentioned this before when you go into a rate cycle we're kind of past worrying about how many we kind of look to the end and decide what we want to believe about the future and one of the most interesting things is the rate of change of this inflation was actually lower month over month and so if you think about it that way we had a bad cpi print but it's actually not going up as much and in fact it's starting to trail off and a lot of economists now forecast basically this inflation peaking or already having peaked over the last few weeks consumer sentiment is not so good a lot of us are now shifting our consumption away from goods to more services we're stopping you know the hoarding of the toilet papers of the world if you will and so i'm not a big buyer of this trade to be honest with you freeburg i think that it works in the short term i don't think it's an investment i think at some point you're going to have to make a decision about what your view on energy is i know i i agree i don't think this is a long term it's a trade not an investment that's right but i do i do think that the macro sentiment sent the market in one direction and creates this up it created a buying opportunity which i was pretty clear about and i do think that some of this global tension stuff we're seeing is only going to drive it up for a while i do i do think however that the the uh this uh big tech spread trade is moving from a trade to an investment actually and that i didn't expect and the reason is i talked to a bunch of folks on wall street over this past week and they told me two things and one of them is a segway because i think we should talk about microsoft which is another brilliant move in the lexicon of business but what they said was facebook has become a funding short for other investments now what does that mean everybody was crowded into big tech we talked about this before right those five stocks were broadly owned they were effectively the index but after that um after that earnings report a lot of investors including retail investors had to decide where to reallocate their capital and had to decide where to invest where the money was going to come from to invest in these other names that were really beaten up and what folks on wall street have been telling me is that you know facebook has become what's called a funding short meaning there is no bid to buy that from institutional owners they'd rather on the march and sell it to generate the cash to then take and invest in other things and what you saw over this past week is the bottoming out of a lot of these growth stocks that were beaten up right they rallied pretty significantly every day three four five six percent rallies um and other names in big tech have rallied really well including microsoft and um and so i i'm i i think that there is the potential a small potential that that's going from a trade to an investment actually a sustainable trend that you can bank on for you know several years investment hold the stock for five ten years the trade that spread trade you can have for a long period of time but for the winners to be the winners in that just so people get refreshed google's microsoft google microsoft google and then you feel amazon facebook obviously and netflix are the losers in that trade still feel that way i think that microsoft and google are far and away the winners far and away the winners and look you saw you saw you saw this microsoft thing today or sorry this past week so smart you know yeah so just to give catch people up on that microsoft has made another savvy move to get approval for their 75 billion activision blizzard uh acquisition they promised their video game app store would operate with open market principles ceo of the year uh satya nadel uh and others trapped into washing uh in nadal uh nadella right there at the end um trouble to watch this week to meet with regulators regarding the acquisition so they i guess are proactively going to washington as opposed to other people who maybe are not quote from microsoft president brad smith we are more focused on adopting adapting to regulation than fighting against it that's some really interesting there's a there's a famous story about this explorer named hernando cortez where you know we've all heard this analogy or this this this uh little phrase before um where you know when they were exploring um coming from europe and you know they hit the caribbean islands and then you know looking for america et cetera the famous phrase is burn the boats yep right can't go back we have to find our way make it work um the the way that that's been extended in business is sort of what we would call scorch the earth and there's a competitive move that a lot of businesses if they're smart enough can execute which is to effectively take a key market and take an economic view of that market where you say that we're going to take all the economic value away from it and i think this is a first step towards a really interesting play that microsoft could pull which is essentially to scorch the earth of app stores which is google's and apple's really big money printer to make a completely open permissible platform with very little to no take rate and in a market as big as video games i think what it does is it creates pressure on all these other mega platforms to essentially copy them and i think fredberg mentioned this before google has actually been the best in doing this by finding these key markets or i think it was saks you know chrome and other things and giving them away for free google is in a position to make the app store effectively free and then that puts apple on a little bit of a desert island so jason back to why i think you can keep apple in that basket of shorts the competitive pressures are mounting by by the moves of microsoft that i think are easier for google to copy and very difficult for companies like apple to copy because it creates an incredible um disincentive yeah and also as part of this open app store concept they would let you use any payment system so if you're on an iphone and you wanted to use apple pay with a google app purchase you could do that and if you were on you know microsoft you could use paypal as an example saks what do you what do you think about inflation okay there was a really interesting chart on inflation that actually zero hedge tweeted and um i threw it up in the notes here where they said real hourly earnings are negative 1.7 it's the 10th month in a row where u.s incomes aren't keeping up with inflation so the problem here is that you know people's incomes have increased with inflation but not as much as the inflation rate so the net effect of it is that people are feeling worse off when they go to the grocery store to buy groceries or whatever they need they don't feel as rich that's the fundamental problem here and i think there's a lot of people out there who think that there's a free lunch that if we printed two trillion worth of stemi checks this is the whole that two trillion dollar bill last year they shoveled through i think the idea was we're going to print as much money as we can for the election and it's going to help us in the midterms actually as it turns out it boosted inflation so much that people are feeling worse off even though their wages went up slightly because on a net basis their earnings are down so i just think it's a good reminder that um you can't just like print uh wealth you can't print your way to prosperity no free lunches there's no free lunches yeah or we're gonna create addiction to universal income or universal subsidy um that's the alternative is people are gonna basically try and vote to make some programs that were initially meant to be temporary more permanent in order to keep up the uh the lifestyle that they've been come accustomed to just uh just to build on saks's point uh the university of michigan consumer sentiment was released i think it was today this morning and it shows exactly what he's saying which is that you know consumers propensity and confidence in the economy has been falling off a cliff you know the month over month change was almost uh it was down 8.2 percent the year over year change is down almost 20 percent current economic conditions was down 20 and then index of consumer expectations down 19 so to to sax's point people are scared yeah well we've been we've been talking on the show for the last i'd say a couple of months about balancing the risk of recession versus the risk of inflation inflation i think has gotten slightly worse the print went from the last print was like seven point one percent now some point five percent so to jamaa's point earlier it's getting worse but the rate of how fast it's getting worse is speaking but the risk of recession i think is increasing because what's keeping this economy going is the consumer and if the consumer sentiment now all of a sudden is tanking and people feel poorer because of inflation i just you know now the the risks are starting to become sentiment as sentiment goes down this is where governors play a critical role because if they don't open up these economies we can't actually have a consumer-led consumption rebound of the economy because there aren't any services to buy because you can't actually be around anybody so if the economy remains effectively closed and people are done buying you know tubs of margarine and toilet paper because you know armageddon isn't coming as we were worried it would what are we supposed to be doing so this is how these things interplay so we have to get these again going back to where we started we have to get this economy open and we have to just get back to some sense of normalcy and the consumer will lead us out but i think saks you're right on the margin i think the risk is towards a recession because people don't see this thomas sowell who's a well-known stanford he's a i think he's a senior fellow at hoover um you know he he has this comment which is effectively taxes are bad for the rich and the poor but inflation is bad just for the poor and the reason he says that is because you know if you're wealthy you can transition to assets that are sort of inflation adjusted or inflation protected right you can consume assets or you can purchase assets to protect yourself but inflation is an exceptionally regressive means of the government taking compensation away from you current compensation and it disproportionately affects working class ordinary people and so if you have real wages that are negative inflation that's high that's confiscatory right you are you are meaningfully less well-off than you were before and you know the wealthy folks have a way to hedge but normal ordinary working class people do not and on the margin then if they then do not go out and spend the problem will be some sort of recessionary effect i also think if we open up more people might since they're so lonely and getting weird staying at home i think they might actually want to go do jobs to socialize and do things i'm seeing people want to get out and do you know trips with their teams and they're and they're sick of staying home salesforce just bought a retreat center we saw this south of the city of the bay area and because benioff's got a concern i guess that all these employees he hired over two years who've never met another salesforce employee are getting weird and lonely and uh you know history is going to be very i think david you're right i think history is going to be really judgmental of biden if he is the last person to basically give the green light and all of these democratic governors basically revolt and open up under underneath you know uh either silence or the complete opposite point of view this is a really bad setup well national journal which again is not some right-wing publication they're just sort of uh an analyst of what's happening in washington said that by an article biden is blowing his covet moment he was elected to lead us back to normalcy all he had to do was say guys it's time for the restrictions to come off and take credit for the fact that we were that the whole country was ready to move on and he's kind of missed it and but this trucker convoy is coming to washington and gives him one more chance i think to get on the right side of this because there's really two ways he can react one is to treat them as you know domestic terrorists you know racists white supremacists insurrectionaries or he can you know embrace them yeah and situations all he has to do is say listen we love you we respect you we hear you we agree with you it's time for these mandates to end and you know what thank you rachel wolinski and anthony fauci for your service we understand you're just trying to keep the country safe but thank you very much we're ready to move on we're getting rid of all these restrictions his popularity would like bounce five points ten points if he did that yeah i'm betting he's going to i mean he's he's always represented the working men and women of this country that's been his thing from the beginning i bet you he does embrace them and if you look at omicron remember the scariness of december hey this thing is spreading 30 40 50 times faster i wonder if it's going to have the same death rate and we didn't know and now we know and it's february two months later we know that the curve in south africa same as a curve in new york and california up and down and then the only people who die seemingly are immunocompromised or unvaccinated or both so it feels like the perfect guy who really led us back to normalcy i mean we really need to give credit to all the people who fought it's the moms who went to these school board meetings were denounced as domestic terrorists they were the ones who put pressure to repeal these mass mandates on their kids which by the way aren't even fully off in new york and california adults don't wear mass anymore but the kids do it's the scientists it's the scientists of the great barrington declaration who were demonized and called fringe and kooks and conspiracy theorists they're the ones who provided the real data against lockdowns not the nih it's these truckers who are basically opposing mandates these are the people who are dragging us back to normalcy and it's the politicians who are reacting to that when the polls change and i think what the people want now is some real leadership it's a politician who gets up there and leads us back to normalcy why can't biden do that there's a great article in the times and they profiled you know a couple people and one of them was a mom in new york who's running for congress against you know an intense and entrenched democrat and she's i mean you know she's just a good hearted mom who was like this is enough enough's enough i need to get back to normalcy my kids need to get back in school we still have mass mandates here in california kids are still wearing a massive school yeah it's becoming tribal warfare amongst the democrats in california because even when you know the the governor basically said okay mass mandates can go on ex-date the the county supervisors have not decided so for example in santa clara county you know uh they've not said yes in l.a county there's a health an unelected bureaucratic health director named barbara ferreira she calls the shots on covet after newsome basically said that the mass can come off she says no they can't not until april who is this person giving us orders she told this to the board of supervisors down there and we're all just supposed to listen now the reason why she has this authority is because newsom is granted to her under a new state of emergency so what he should do is end that what is the emergency the super bowl is happening this weekend in the state and everyone's going to be there massless i mean i was at the warriors game last night and you had people wearing the most flimsy of masks that does nothing to protect people taking them off while they're eating and drinking and then people walking around with signs the security guards had signs that said please put your mask on and they were walking up to people i kid you not and putting this like little round sign uh in people's faces and not talking to them just you know and they would stand there until you put your mask back on and like you're literally eating a hot dog and then you put the hot dog down and then they come up and put the sign in your face then you put your mask up you take another bite of your hot dog i mean it's getting unnecessarily confrontational and just weird and and nowhere else are you seeing it and then you go to a restaurant and the employees are wearing masks and nobody else i hope i hope you can find it so there was this clip on twitter um when the mask mandate was lifted in nevada and it was a clip of kids in like grade two or three and they went crazy okay and the reason they were so excited was like they got to be normal again and the explanation i had never heard this more beautifully said these children can finally see their friends emotions on their face oh my god can you imagine if you're four five six seven years old and you cannot understand the emotions of other kids because you're covered up in a mask and you've only had an experience in school two years in school my six-year-old has never attended a day of school without a mask you know i was about to say right like that's there's kids out there who have never had you know i was at i was at uh like the i was at horses with one of my kids last weekend there were a bunch of kids out there writing it's sunny it's outside they're on a horse they're all wearing masks in a voluntary optional situation i'm just like how brainwashed this generation that we're raising i mean they're going to be so neurotic but they're also like brainwashed i mean it's it's crazy we see it in the bay area like i'll have a party with the kids or a group of kids come over and there's two or three parents who show up at the house we only do outdoor parties obviously two or three of the 10 kids will have masks on their parents will have masks on and like the most intense n95 like sealed masks and i'm like you want to take your mask off for a picture and one of the kids refused to take her mask off for a picture outside at a birthday party i was like okay listen i mean when i supported the mass mandate the very beginning of the pandemic it was always as an interim measure if i had known that people would want to continue this thing forever there's no way i would have supported it but it also probably was effective in the early days with the first round we know what the psychological impact to children is when they don't understand other people's emotions and you do it over a long period of time no we don't i think that's a fair statement we don't know the impact sure and it's probably not zero and so at some point we need to look at the risks calculate some expected value and the people we need to prioritize are those that are the youngest okay and i've said this before and it's like the teachers unions need to understand that calculus parents already understand that calculus i don't think the state legislators governors in the federal bureaucracy yet understands this calculus but it's time to return to normal and it's time to return sorry and on this point i would like to bring up something um uh the aclu thing um just because i think i would love to get your take on you know talking about civil liberties and freedoms there are things that are happening here under our noses every day um under democratic and republican uh presidents that to me when i saw this on the aclu twitter feed yesterday was shocking jason do you wanna um tee that up all right in other news the cia has been secretly conducting surveillance programs to capture americans private information on thursday uh democratic centers widen and heinrich sent a letter to director of the cia and the director of national intelligence the letter called for greater transparency in the cia into the cia's data collection of private us citizens basically the cia used executive order 12333 which was signed by reagan in 1981 to gather data on u.s citizens the letter notes the program was quote entirely outside the statutory framework that congress and the public believe govern the collection and without any judicial congressional or even executive branch oversight that comes from fisa that's the foreign intelligence surveillance act election quote what these documents demonstrate is that many of the same concerns that americans have about their privacy and civil liberties also apply to how the cia collects and handles information under executive order and outside a fisa law in particular these documents reveal serious problems associated with warrantless backdoor searches of americans the same issue that had generated bipartisan concern in the visa i mean where where where is the mainstream media while they breathlessly run around chasing cancellation stories where are they to report and to hold accountable this stuff and where are politicians in actually doing their job but you know i don't think there's ever been this kind of overreach that's just constantly been going on with zero accountability or transparency into it you know the fbi is responsible for domestic laws right and the fbi has a very clear path in which they need to get warrants in order to be able to surveil u.s citizens and then the fact that we give an agency whose responsibility is actually foreign yes to be cia is supposed to work only on international not domestic and then to basically spy on its citizens with zero accountability reporting it seems to be a pretty important issue that should at least be discussed especially in a world now where executive power just keeps ramping up and ramping up what's going on and there's zero transparency or accountability if i didn't randomly see this on an aclu tweet would we even be talking about this probably not and the and the other thing that's no crazy about it is i think the way they get away with this chamath and this has been something that the patriot act had um a similar technique is they the cia and some other organizations will track international people of interest you know money launders et cetera and then say in order to track them well anybody they contact in america is fair game uh or if they're you know and so you can get the metadata from the phone calls and the emails and i think that's how a lot of this gets just what this letter seems to say is we just there's a broad scale surveillance program against u.s citizens that is indeterminate uh in scope and scale right so we don't know that seems very different than that and then in in parallel to this there's also that announcement that the department of homeland security is creating this major apparatus infrastructure to go after domestic terrorists well look if they mean people who actually like set off bombs or commit real crimes fine but trumath you asked where the media is the media is defining routine political dissent as domestic terrorism now i mean you hear this type of threat inflation we've heard these truckers even described as insurrectionists so you know how are these programs going to be used is really the question you create this massive infrastructure under the executive branch we've seen that in washington this trend towards criminalizing political disagreements where democrats republicans have been putting their partisans in jail for years but are they now going to apply this to political disagreements in the country can they use these powers to go after truckers who are engaging in civil disobedience can they use these surveillance powers to go after somebody who just tweets things on social media that they don't like i mean these are the open questions yeah it's very scary well and it's also hard to determine because you might have some people on the right who are protesting uh something in a very valid way and then you get some whack jobs like the oath keepers who are bringing in tons of weapons outside the dc area on january 6. so there's a valid concern here with all those weapons the oath keepers brought and their plans to do a coordinated takeover after they first got in there but then you have the other [ __ ] where they are probably just there to have fun and bang drums and and support trump right so do you think these truckers are engaged in insurrection well i mean we don't know and i don't think so no i mean if they if they bring a bunch of guns then yes we should have concerns but i don't think they are the slippery slope is when you have an executive order that is not governed by the standard guard rails that we use to have checks and balances between these kinds of government agencies and the people and the elected officials that we elect here's how it basically gets in a really tricky place you have let's i'm just going to use justin trudeau's quote okay but replace that person with any politician in power hey there's a small fringe minority of people um who are on their way here they hold unacceptable views well you know what that person is going to do that person is going to want to do everything in their power to basically understand break apart um and tear up that fringe minority group now isn't that scary right when you have this overheated political rhetoric that describes your political opponents your your dissenters the state yeah as enemies as white supremacists as nazis they're as insurrectionaries as domestic terrorists why wouldn't then the law enforcement arms of our government then treat them that way i mean does the department of homeland security or the cia or the fbi do they understand that the politicians are just engaging in rhetoric and in threat inflation or will they take that those invocations literally to what we have to investigate and stop these i think they've done a department of justice done a pretty good job of that i just want i just brought this up because i think it's really important for somebody in the mainstream media of which many listen to this podcast sure you have a responsibility to actually double click into this issue and figure out what's going on please yeah for on behalf of all of us by the way like if you guys look i mean wall street journal new york times bbc everyone covered it today but the story today is that lawmakers made this claim with no details and no evidence so i'm sure the investigations are underway i mean the journalists are clearly leaning in to identify you know the the evidence behind the story and i'm sure more will come out over the coming days and weeks and in fairness like you said is the justice department doing this even-handedly they were very specific with the the january 6 interruptions acts where they went after oath keepers because they had a coordinated they're a militia they literally referred to themselves as a militia and those people are getting treated very different than the people who broke glass or sat on pants pelosi's death those people are getting three months suspended sentences six month sentences and the oath keepers who are a militia they call themselves a militia they're dangerous and they're treating them very differently and they're the only ones who are being charged with the more serious 10 to 20 year sentences so i would say they are doing a great job all right everybody this has been an amazing journey from uh truckers to joe rogan and all the way to uranus and back four the rain man david sacks the sultan of science dude nobody knows your outro jason dictionary they know we are they live for the show people love it love you boys we'll see you all next time love you besties [Music] and they've just gone crazy with it [Music] we should all just get a room and just have one big huge orgy because they're all just useless it's [Music] we need to get [Music] i'm going on [Music]








so saks are we gonna talk with each other today or you know or he's an iso player he turned into an iso player he's like the carmelo anthony of this he's the carmelo anthony of the all-in pod sack you want to pass the ball or you just want to you want to clank it off the room raymond clay i mean we should have a focus on having a dialogue with each other today several points in the thing as opposed to all standing up saying our piece and then hopping we lost a little bit of the fiber of this team here there's three people playing as a team and then they're sacks i would love to ask you questions and i would love to see my job the ball jay cal you're the guard you pass the ball i'm supposed to score oh really remember what uh shaq used to say when he wasn't getting the ball he gets really unhappy he said pass the ball to the big dog he'll score yeah i'm shaq you know you're not kobe who is the shitty yeah you're derek fisher make sure that big dog gets the ball there won't be any problems i'm bob cousy okay i'm gary payton in this okay [Music] [Music] hey everybody welcome to the all in podcast where three besties talk about a range of talking topics and one monologues about biden derangement syndrome with you again this week the sultan of science and the dictator parliamentaria and playing iso ball somewhere in the wing is uh your political commentator junior projection david sacks it's an act of projection which sacks is gonna lose his mind over he's got two monologues prepared justin trudeau has invoked an emergency order to freeze bank accounts linked to trucker protests in canada on monday trudeau invoked an emergency law that requires financial institutions in canada to examine customer records and take action against people involved with or aiding in the protest here's trudeau's tweet from yesterday if you're watching on the video streams illegal blockades and occupations are not peaceful protests they're a threat to jobs and communities and they cannot continue in the house of commons earlier today i joined members of the parliament to speak about that and about the need to invoke the emergencies act the counter signal which is a right-leaning canadian digital publication reported that 34 different crypto wallets were also being targeted by canadian officials this law grants the government extraordinary powers like the right to ban public assembly in certain locations the canadian civil liberties association said it planned to challenge the government's decision in court uh remember sax wrote a piece on financial d platforming for barrio ice's common sense about a year ago the piece was about the private sector financial platforms de-platforming folks uh so your thoughts sacks you have 90 seconds on the uninterrupted clock on the shot clock all right thank you jay kelly it's true last summer i wrote a piece for barry weiss's sub stack talking about how financial d platform would be the next wave of online censorship and here we are it's actually happened what i could not have predicted is that it would occur in our mild mannered neighbor to the north and that the reprisals would be directed by the government itself not just a consortium of private actors and what trudeau has done is he didn't just employ the emergency act against the trucker so that he could basically arrest them and break up the protest they have now directed banks and any financial institution even cryptocurrency wallets to freeze the accounts not just to the truckers but anybody who's contributed to them basically anyone's contributed 25 or more um there were two uh crowdfunding sites that they raised money from all those people the thousands of disordinary canadians who did nothing more than contribute to an anti-government protest they are now at risk of financial rune because their bank accounts have been frozen and you have to wonder what what is the ends here that justifies the means covid you know omicron is on the lane it's on its way out at the same time that trudeau was announcing these dictatorial measures uh ford the the guy who runs uh ontario the largest province 15 seconds ford was out there saying that he was gonna uh that coveted mandates were gonna be over so why exactly are they doing this you know we're at the end of covet and um zach let me ask you a question if um if there were people online making donations to the criminals who loot and kill people in san francisco which you've railed against being criminals who are breaking the law and should all be put behind bars do you think that it would be appropriate in that context for the government to block their donations to supporting criminal activity in a criminal ring um you know that i think we all agree uh you know shouldn't be transpiring well but but your the implication there is that truckers are using violence or or something like that and they're not i mean it's been it's been largely a peaceful protest it's been very annoying to people who you know but isn't the case being made that they are actually breaking the law by blocking streets and that's not you know there's a peaceful protest where you can go and get a permit and actually go in a public zone and peacefully protest within the con the confines of the law and what's allowed in that jurisdiction look but what these folks are doing is civil disobedience which is not a peaceful protest it is you know kind of breaking the law to make a point it is peaceful because there's been no violence if you look at actually but they're breaking those they're breaking the law right well let me let me ask the question for freeberg then um sex if a group of truckers were shutting down the bay bridge with three lanes of traffic and then shut down the 280 and the 101 and it impacted this if they in fact are shutting down roads emergency businesses and our emergencies can't get through would you want them to be towed would you want their cars to be towed listen here here's the thing the ambassador bridge this vital choke point of commerce between the u.s and canada that was blocked and that was creating a serious problem but it had already been cleared on monday by the time that trudeau invoked the emergencies act and then on tuesday he then invokes this financial act your opinion sacks if they if they block roads and bridges would you if they're in charge yeah if they're breaking the law in that way it's not just one lane it's all three lanes damage is society i'm just trying to understand the the standard here because just zooming out to last year and the year before right there was a protest happening with blm and those blm protests resulted in damage to private uh property uh to burning cars there were protests at the capitol that involved folks trespassing into federal land and federal buildings and now there's protests that are uh you know blocking vital trade routes and you know access to emergency vehicles and all this sort of stuff to me and also you know people in san francisco breaking the law and not being put in jail my personal opinion is anyone that's breaking the law we should stop them from breaking the law and anyone that wants to kind of you know follow a peaceful protest or make a point should kind of make the point but if the law is the law shouldn't there be a universal standard to hold up the law and if the case and if the case is people are giving money to aid in breaking the law shouldn't we stop the hold on you know transmission go hold on hold on a second look i think you're conflating a bunch of really important things there aiding and abetting criminals uh is already illegal there are rico statutes that um allow the authorities to go after people that are aiding and abetting through monetary support criminal behavior separately there is a whole body of law at the federal state local level that allows you to deal with protests okay the real question is why did you have to go and invoke emergency powers at the tail end of a pandemic for what is effectively non-violent protests again that's the key question right so just to give you some canadian history uh as a canadian citizen what i can tell you is that we've invoked this emergency powers act three times in the past the first was for world war ii the second sorry world war one the second was for world war ii and the third was the flq crisis which was a domestic terrorist organization in quebec that was fighting for a separate homeland that's those are the three other times in the past that a sitting prime minister has invoked these broad sweeping emergency powers and they did it because you exhaust the natural body of law and the constitution and the bill of you know the charter of rights that governs the normal behavior of a democratic society what this was is not any of those things i don't think anybody could claim that a bunch of non-violent protests yes they were annoying yes they basically you know stop some commerce but i don't think it was on the order of world war one world war ii or a domestic terrorism issue like the flq crisis so why invoke this basically get out of jail free card where you can behave without any checks and balance this is the confounding hold on a second did we exhaust the current body of normal governing law and if we didn't why is this example okay and the counterfactuals are so many imagine trump invoked this thing during blm imagine biden did this right now right you would be up in arms i think that's well said let me just add something to that the emergencies act that trudeau invoked requires something like an act of espionage against the country or syria the word serious violence or in the law or the threat of serious violence those conditions were simply not met yeah and then on top of that to go after people who contribute as little as 25 to these truckers who are trying to support them because these guys are not making any money you know there could they have very they're living under very harsh conditions so you make a small check you write a small donation to support these people to aid them they're simple working-class people who are protesting for normalcy and get their freedom back and now all of a sudden your bank account gets frozen it is basically creating a it's gonna have a chilling effect because it's essentially creating a cast of untouchables because no one is going to want to associate with transact with or donate to this group of people these designated people now under the emergencies act who your bank account can get frozen if you deal with that i think it's going to have the opposite effect i think this is going to blow up in trudeau's face this is the worst decision making by any major political leader in a long time to go after a group of people as champa said in the in the waning days of a pandemic what is the point why are we picking this or why is he picking this guy up so why makes no sense but why is he doing it and jamal why why did the police not break so i totally hear your point why did the police not break up these protests why did he need to invoke the emergency because look it happened i think that the police in some cases did in some cases didn't there were probably a lot of police sympathizers there were probably a lot of sympathizers in general as there were a lot of people who were detractors oh you think the police you're saying there were police that were complicit it's the nature of a protest you have people for you have people against but the point is i think what's really clear is justin trudeau first basically said these people are racists and misogynists then he said they just hold views that are just unacceptable to me and then like a totalitarian dictator invoked an emergency measures act that allows him to do what he wants that's the fact pattern he painted himself into a political corner and then tried to give successfully he gave himself absolute power for some period of time and the real question i think is why should this be allowed to happen in a democratic country with democratic norms against people that haven't done as far as i can tell a shred of violent behavior no it hasn't been you guys and where it's clear that the body of normal governing law hasn't been exhausted yet meaning the minute that these people were asked to actually empty the ambassador bridge they did guys we're canadians that's what we do yes we love to pronounce but if you just ask us super nice exactly no you're right trudeau never tried talking to them i mean why wouldn't he just try and talk why wouldn't he just try and negotiate with them instead he demonized them right all that bad as white supremacists and nazis and even you know confederates or which i don't even understand in the context of canada this is yet another example of the dying death right in front of us of the woke playbook right we talked about this last week i think it's related to the san francisco board of ed recall that's now national and probably even international news the the the reaction to rogan the reaction to dave chappelle it's all part and parcel of this thing where people up and down the spectrum have learned what the mechanism of action is of this cancer culture and they don't fall for it anymore there's a person that's able to escalate it because he's actually in a seat of power and that's what i think people should be debating you mean shutting down dissenting voices from a position of power just because and he went unnecessarily he went on the record and he said guys these views are unacceptable to me well in a democratic society that's not your choice yeah not your choice justin i mean and i could have engaged with views on all kinds of topics all the time unacceptable is not the threshold of world war ii world war one in the flq crisis do you guys think that there's a moment here that also is a mile marker on the road towards the state versus crypto given the actions that we're taking against bitcoin wallets because that seems to be like a big trend that's going to play out over the next decade or two they're there inevitably crypto is the threat to the state right and so you know you're going to see skirmishes like this that kind of you know hey wallets that donate are illegal and you know free break this is one of the best points you've made if you look at what this has done to bitcoin and you look at what it's done for other cryptocurrencies this will do more than mcdonald's accepting bitcoin because this is the first time like a western democratic state is seizing people's funds like in an incredibly unfair unnecessary way which is just going to have more people say you know what maybe i should keep some of my net worth out of the government's purview if they're going to seize it anyway and then now people are going to start looking into the coins that allow people to can't conflate having an enemy with having a different view these aren't the same thing having an enemy is a serious deal right whether that's domestic or international that's what we had to do in world war one world war ii in the flq crisis this is just somebody who has a different opinion i don't agree in mass mandates is what one person says i want a mass mandate is what the other person says the idea that you can deplatform one or the other or fire them from their job or prevent them from having access to the money that they've earned or preventing other people from donating money that's really um it's a really low bar and i think when you normalize this kind of behavior it's a very slippery slope and so if if somebody else were to do it they now have like it's again going back to the rene gerard sort of philosophical discussion from last week one of the things uh about you know these stoning rituals right that sacks talked about that we talked about last week one of the things that rene gerard talks about is it is always hardest for that first person right the first person that throws the stone right that's how jesus was able to defuse that that incident as described in the book of john but in a different example the first person that throws a stone all of a sudden normalizes it for everybody else after them and then these stonings become commonplace or became commonplace so similarly it's like if you're a sitting democratic person who just decides this doesn't work for you you can't flip the script and and basically remove everybody's democratic rights that's really crazy it's actually at a closing point you want to make well okay just on this point about bitcoin the the reason why bitcoin is necessary is because the tactics that trudeau is using is essentially to starve these truckers out to not only basically arrest them and but he's also taking away their insurance licenses he's basically preventing them from ever working again he's talked about that we're gonna put give you a criminal record it's gonna make it hard for you to get a job and then most importantly on top of that he's preventing anyone from helping them by contributing to them by making a donation so he's essentially starving these guys out and that's the reason why bitcoin is potentially helpful is it allows people using non-custodial wallets to make an unrun around that and donate and help these these people who are being persecuted essentially i mean he could have just simply chosen to do what sax's favorite president obama did with occupy wall street which is say great you have something you want to voice here's where you can do it just you know no guns no violence but we let how long did occupy wall street last in downtown wall street and in oakland and other places like a year or two and you just wait them out and that's it i think when you encounter a sincere protest movement the first thing you should do as leaders actually listen and try to understand what it is that they're protesting on behalf of and trudeau never did that he went straight to 11 with this and i think part of the reason why i mean jk you asked why why is it that that you know there seems to be a common denominator with this and with the ukraine issue that the leaders are immediately escalating these situations instead of looking for a way to de-escalate it and they're doing it with the media egging them on and so as as harsh as trudeau's rhetoric has been the media's rhetoric around this has been even worse you have this cnn contributor juliette kyam who's also a harvard professor who basically tweeted that trudeau needed to slash their tires empty the gas tanks arrest the drivers you know making it unclear how you'd never get the trucks off the bridge uh but then she said cancel their insurance suspend their driver's license prohibit any future regulatory verification uh she says trust me i will not run out of ways to make this hurt you know it's you have the media cheering this on egging on trudeau they're doing the same thing beating the drums of war on ukraine what is wrong with these people yeah de-escalate and where's the off-ramp i think the biggest the biggest story is this um this bitcoin thing because you know if you guys think about like pre-1960s like capital wasn't digitized it was like physical like you had to own like a stock certificate or cash or gold or a bearer bond to today everything is digitized right like there's a digital record of you know who owns what stock and who how much is in your bank account and none of it is tied to your having a physical asset and ultimately the law was able to reach into these digital systems and have greater um uh oversight and ultimately control uh you know over accounts and so on and it's had a you know the digitization of capital assets has had an incredible ability to drive economic growth and investment and ease of transaction but it's also significantly increased the centralization of assets or the central influence over assets bitcoin seems to be the resolution to that and now you're seeing the ultimate challenge to bitcoin and the challenge to decentralized systems like bitcoin and cryptocurrencies and so on i don't want to speak specifically to anyone but there seems to be like this trend line over the last 60 years that's now being challenged because you could have your accounts frozen any moment um you know for breaking the law or because emergency acts are are induced and i think you're right it's probably going to accelerate interest in these kind of off government chain if true into some separate chain anyone can do it anybody can do it they're doing it in china right and they're uh it's the point of it the digital argument is like this incredible the whole point it's like absolute centralization of every capital asset here's where you go think of how dangerous the digital yuan is the minute you say something that xi jinping doesn't like it's a it's a stroke of a keyboard key and all your assets are all your assets are locked away it's a database entry and you just basically reroute who belong who it belongs to or it could be it could happen in america they say you know what california now wants to have a wealth tax anybody who's got money we're just going to take your money out you guys think automatically do you guys think we sound like a right-wing politics show at this point no this isn't a right-wing politics thing i mean i think i think that we have so jumped the shark there are things that are happening today every day that you know if you had said in isolation two or three years ago would any of these things ever happen we all would have just looked at each other and said it's impossible that these things could happen but the problem is fast forward two years of a pandemic i think we have let a lot of our civil liberties decay right under our nose and we're not willing to fight for it because it's become too tribal and and rights have been politicized so the idea of having rights you know and then standing up for your rights all of a sudden has to be a decision between whether you're left or right that's crazy i don't think that liberties in the sense of government oversight have decayed as uh in addition to that liberties in the sense of of a social setting have decayed you know we've because of cancer culture we've normalized the ability to silence minority or dissenting voices and this is both in the private enterprise setting as well as in the public setting and it's um you know i don't know i i don't consider myself a right-wing conservative person by any stretch um but i do consider myself a person who believes in individual freedom and liberty that's called an american by the way yeah it's basically being an american and i think you know as we move on to this uh recall in san francisco i think sax made a really good point like what are our political leaders doing here are they trying to stir the pot and antagonize these situations if you look you know clinton obama a lot of people previously were trying to defuse these situations and then biden seems to be stirring the pot justin trudeau and then if you look at trump with blm you know and the immigration stuff he never sat down and met with him and he arguably antagonized them so i think this is a perfect segue into what happened and you know so we should expect a little more from our political leaders great point from sacks you just bought up something incredible you know trump railed against these blm folks but at no point did he try to shut down their bank accounts and take their money away and trudeau can't you know did this was not even near in the scale of blm yeah who's the bigger authoritarian yeah i mean clearly if you objectively it's true in this situation the scary authoritarianism as we talked about in previous pods tends to come from the left at least the right you see it coming it's failed under moral virtue signaling that's right they're very sanctimonious they claim they claim to be the defenders of the working class while they're actually prosecuting them such an unforced error like so dumb he's going to lose right now he's going to lose if a d.a was elected and a police officer police chief were elected to san francisco that said we are going to freeze the bank accounts and um you know uh demobilize the criminals that are ransacking our city our people our stores would you support that no not if it's an office an extrajudicial use of power i mean the law specifies what you're allowed to do do you think san francisco's in an emergency situation i mean would you support the mayor taking on emergency uh authority to go and fix the problem which she just did by the way in the tenderloin yeah but that doesn't give her the power to go to wells fargo and say to wells fargo we want you to freeze all these accounts with no due process of law that's basically what trudeau is about that's the overreach that's the line you think is like go and see that you should have to go through a court proceeding just to free someone's bank account period can't just freeze someone's man count the law allows you to do this now it's called rico so you follow the due process of the law and you can do all those things friedrich that that you just mentioned if you want to free somebody's bank account right you can actually do that the government has the ability to do that they don't need to pass this basically get out of jail free card to do whatever you want without any oversight and teacher matt's point earlier have you exhausted the regular law here i haven't all the provinces are ending covet mandates anyway so this whole issue is moot so dumb it's this is like the stupidest behavior at the end of a pandemic that we've ever seen and shout out to george lucas for getting it right i mean if you look at the theme of star wars it was like oh i just need emergency powers for a minute because of a trade federation blockade and here we go a fake crisis yeah that wasn't george lucas by the way i mean that goes back to the uh the roman empire right like yeah yeah that was the formation of the empire caesar caesar got emergency authority i mean this is a tried and true and the poll the polls are actually right and the polls show that the most of the public in canada is applauding so what was the line from democracy dice to applause exactly that was padme's line in the star wars films all right uh they're aging well the prequels uh three members of san francisco's board of education they were the worst just to be clear but go on sorry uh not compared to the three just huge dumps that disney took on the our childhoods with the sequels three members of the san francisco board of education were called this week massively they lost by between 72 and 79 these were the virtual signaling maniacs who wanted to change the names of all the schools wouldn't reopen the schools yadda yadda and this uh really frustrated and they wanted to get rid of elite ap classes all of this they did jason they did they did yeah um and these three board members are out so london breed jason jason just to be clear in the middle of a pandemic i think my understanding is that instead of figuring out how to get these kids back in class how to figure out how they could take off their masks they wanted to drop abraham lincoln and george washington's name from schools because it was it was too regressive yep they cancelled the gifted program because it made other kids feel bad and a gentleman that wanted to serve on a committee who i think was gay but not minority was excluded because he wasn't a minority enough for them so these are the three people that uh 76 of san francisco citizens or you know residents just uh recalled and if you're not following this the tech industry had a major part in this in terms of backing it there was a lot of claims which i'll let sachs address in a moment uh that this was a republican-driven out-of-state movement but if you look there are not a hundred thousand republicans in san francisco and all likelihood this was actually apparent in a lot of cases based on the geography of san francisco and the density of certain populations a lot of asian americans came out in force and some neighborhoods 90 percent were voting to oust these people uh gary tan uh who is a product of the san francisco public education system and a great entrepreneur and venture capitalist uh was a leader in this movement so congratulations to him and this all is going to culminate i think in may or june sucks will correct me with the recall effort for uh chesa boudin uh this killer d.a who won't prosecute anybody sex what are your thoughts on this victory and full disclosure you were a major donor to this i was the second largest donor and i was the largest donor under age 90. arthur rock was the biggest donor what a badass by the way the guy is 95 years old he donated to 400 000 to this uh recall um in fairness you live in san francisco this is a backdoor issue for you you care oh yeah yeah look i think crime in schools are the key quality of life issues in any community and it transcends partisan boundaries if your kids cannot get a quality education and you cannot be safe in your community nothing else matters and that matters to democrats just as much as republicans and that's why like you said three quarters of san francisco voted for this recall even though 85 of them voted for biden's not it's basically a 90 democrat city so uh you know all these claims that was a republican recall turned out to be nonsense this was something that was broadly supported and um and you know look it's the same reason that yunkan flipped a you know plus 10 democrat state in virginia which is that you know it had a lot to do with school closures they kept the schools closed for a year and a half uh and then when they were supposed to have conversat a pta meeting about reopening it like jamas said they spent five hours debating whether to allow this beloved gay parent on to a voluntary school board they didn't they spent all their time you know talking about changing the names of the schools instead of how to reopen them they also there's chronic mismanagement i mean the school is something like 125 million dollars in debt despite you know being in a very rich city they opened for one day that's right just so that they could get a state uh piece of the state budget pie so these kids clamored back to school just so that they could technically say yeah we were open and to get i think it was a 12 or 13 million dollar check and then they shut the schools down again right and you brought a key point jason which is that the asian american community in san francisco has been absolutely galvanized by this issue because this school board also you know lowell high school was one of the best schools in the city and it was merit-based and it had great advanced math programs and this this board basically got rid of all of that stuff and it infuriated the asian american community many of whose most prominent members have basically risen out of poverty because of the education they got at lowell and so this war on merit that's happening is something that is going to you know flip the you know asian american community i think to when i when i was growing up i grew up in a french ghetto of otto and i was supposed to go to a local high school that was just plainly trash and i was able to go to an equivalent of lowell this a public magnet high school that had uh advanced classes and everything a gifted program and it really did change my life and so i really understand what people are saying which is like when you're in poverty the only way out is through an education really you may you know get accidentally lucky but the only really predictable sustainable pattern here is is through school and so when you deprive folks from being able to get a decent education and there's no real you know orderly logic to it it's a really ridiculous kind of an idea the other thing is i think that this speaks very powerfully as sac said as a non as a bipartisan issue that these democrats have to get right because you know you saw this also in virginia where democrats basically went down this one tack and you know the republican candidate glenn younkin basically said hey listen the schools are broken it completely doesn't make any sense we oppose a lot of what's going on the watering down and the critical race theory et cetera et cetera and he put it to a vote and a lot of people cross the aisle there as well where typically ardent democrats basically voted for this republican governor i think the point is that there are just several issues that are just so transcend like they're just they transcend all party lines and this is an anchor issue that we have to get right friedrich any thoughts on this do you think this is the start of maybe a turnaround for san francisco because chester boone is way more hated and safety is an even bigger issue i think for a lot of people right now in san francisco and it dovetails with asian hate and the number of asian people targeted in crimes so he's got a i mean if these people got out by 75 on average he's going to be out by 95 percent is this a tipping point is san francisco going to make a reason i don't know i mean look i think there's generally a broader trend and momentum around what we classify as locism which i think is a little bit disparaging to the intention of social justice and recognizing the the primary points of social justice through action and behavior um in civic discourse and and government behavior um and you know this like the um election of several das around the country uh who take a different stance to prosecution of crime to try and create better options for rehab and and so on um i think is not a movement that's going to go away overnight i think there's certainly a hefty amount of resistance but what we're really doing right now is i think we're learning and realizing the boundaries of this movement and of this moment the one boundary that i think san franciscans are too bad san francisco like you know as in the case in tech has always been so progressive in terms of you know doing these things faster than anyone else but what we're realizing in san francisco is non-prosecution of criminals as the d.a has undertaken over the past couple of years leads to really heinous crime um and rampant crime and um and and this kind of social justice movement within the education system causes a decline in the value of our education system those are two really important learnings that san francisco has had over the past couple of years with this very important um and momentous kind of social justice movement but it doesn't mean that the movement is over it doesn't mean that quote-unquote vocalism is over it means that that social justice intent is still there but we're realizing where the boundaries are and how far things can and maybe should go i posted this article um tyler collins who's a you know pretty well-known economist he wrote this op-ed for the for bloomberg and what he said is that wokism has peaked um and there's just these two passages that builds on what friedberg said uh quote by wokism i refer to a movement that on the positive side is highly aware of racism and social injustice and is galvanized towards raising awareness on the negative side it can be preachy alienating overly concerned with symbols and self-righteous unquote and i think that that probably does summarize sort of like where it starts which is i think rooted in a very good place but unfortunately all too often where it ends which is that sort of moral absolutist judgment cancel culture around it and then the second quote that he said was the following he said quote vocalism is likely to evolve into a subculture that is highly educated highly white and fairly feminine that is still a large mass of people but not enough to run the country or all its major institutions in the san francisco school board recall for instance the role of asian americans was especially prominent unquote so i don't know i just think that all these things sort of you know people are looking for affiliation and you start with labels that bring you in and then you have to sort out are all these labels really true and how true are they and i think we're in this moment now where now we know the mechanism of action of vocalism i just don't think it works anymore and i think a lot of people will say i believe in the high order deals of racial and social justice but i don't believe in the mechanism of action and so the pendulum swung too far but but but the core intent of a generation of change is underway which is social justice and climate change i think those are the two big uh points of it just won't be done with this cohort under this well it won't be done to this extreme this fast right and um and i think that the pendulum went too fast too far um and it's um and there are boundary effects that are causing recourse right now and we're seeing this across the country especially in new york with the election of the mayor and san francisco the d.a recalls happening in the next couple of months so sax what's your prediction on the da recall by the way well that's 95 but i mean to build on your point they were talking about 10 of the people in the united states who are involved in this you know retweeting and virtual signaling and you know is twitter a real place well no a city is a real place people have to live in san francisco and when these ideologies result in unlivable conditions for people well they're going to say you know what there's reality here how do we get competent people to take the positions sacks that are being vacated now who should london breed put in these three positions and maybe tech people need to i mean this is what i think has to happen i think some number of tech people have to get off the bench and say you know what i'm going to do a tour of duty as politicians in san francisco to to take back the city what should happen here in terms of who takes these positions because republicans can't win in san francisco so you're going to need moderate democrats right sex before sax goes can i just say something because i think i just want to say something that's really important i'm sorry to jump in but j cal i think the point you're making about the tech people implies the tech people are effective and good at doing this but that's not necessarily the fabric of san francisco i've lived in san francisco since 2001 the number of people in san francisco in 2001 that were in the tech industry was a minority since that time it became a significant size and over the last two years since the pandemic it's decreased significantly but san francisco is a city with decades and generations of history my wife's family is multi-generational san franciscans and i don't think that traditionally san franciscans view tech people as the right people to solve these problems for them that the intention of that city is not necessarily about let's get tech people to solve our problems they have a different set of values perhaps um and so we we often overstate and assume that tech people are the right people and are the the problem solvers but i don't think that that's necessarily the right problems that people want to solve so i just i just wanted to interview and then who should take these positions because right people typically really far left people are motivated to take these positions i don't see business people writ large across all political you know positions but specifically in san francisco don't want to take these positions so is this just going to be replayed saks the recall effort was led by two parents autumn lujan and sivaraj they're the ones who led this thing they're the ones who rose up to basically oppose these crazy school board members and that is who london bridge to talk to i mean she needs to go talk to the people who are successful in organizing this recall because they understand the issues obviously and the people are with them so either appoint them to the board or ask them for their recommendations and i think what you see consistently whether it's with this sf uh school board or the the uh the school boards that we saw in virginia that yunkan very effectively ran against is that they don't believe the parents matter terry mcauliffe's fatal that his last gaffe was basically saying that the parents shouldn't get to decide what is taught in the schools he basically said the quiet part out loud but that is what still across the country the teachers unions believe and most of the democratic party the activists believe and until they start losing elections you're not going to see a change in that belief oh my god how awesome would it be if sacks are on the school board oh my god yeah uh and just to put a pin in this uh and the cherry on top the san francisco board of supervisors voted seven to four to send a recall reform bill so their reaction to all of this is to do a recall of recalls and say now you uh can't recall somebody in their first year and the people who are placed in these positions can't run again so now the speculation is the three people who got voted off are going to run again so there's a lot more to come on this yeah and also part so they're putting just to staff that they're putting that on the ballot on june 7th the same day that we vote on the recall of chase booty and the board of supervisors now put in this measure that would make it far harder to recall people one of the provisions of that is whoever london breed appoints as the successor like you're talking about they cannot run after that so it is designed to for no that makes no sense they're basically doing a great job right exactly it makes no sense so you have the board of supervisors trying to throw a wrench into the democratic process meanwhile these are people who claim to be preserving democracy saving democracy they are trying to throw a wrench in the thing is underlying it david is they think they know better that's what it fundamentally comes down to they are willing to have democracy up to a point and when that point is an unacceptable view by somebody else they feel like they know better and they're willing to be really draconian in whatever they do to decide yeah and shout out to mike bloomberg i'll pull up the the tweet for everybody he hasn't been very vocal or been on the stage much but obviously he did a great job in new york on reforming schools the san francisco school board recalls should be a wake-up call to elected officials especially democrats across the nation parents are fed up with the status quo and that put adults uh that puts adults ahead of kids yeah an ideology ahead of results well said mike yeah well mr bloomberg yes that was very good and bloomberg has been very good on calling out the democrat their democratic party's blind loyalty to the teachers unions and until they're willing to break with the teachers unions who are their biggest donor we're not going to get any real progress on school reform and this is the issue my favorite political commentator one of them is roy tashira who's a democrat he wrote the emerging democratic majority he wrote a blog post talking about how the asian how asian american voters are going to swing away from the democratic party because of issues like this because of the decline of standards in school and safety and and the asian american community i think is galvanized on this chase boudin issue because they have seen in all these cases of asian hate where elders in their community have been violently assaulted chase abu deen has done nothing except release the perpetrators walkers all right well listen this is seems like a good turning point let's um we talked about on this podcast over and over again about the compression in sas multiples in the public market valuations uh something that we're still working through in the stock market which has been choppy at best over the last couple of months an information story came out just this week major crossover funds like tiger and d1 are slowing down their investments in late stage private companies and i was talking to some folks who said the multiple compression is here now they're not doing the deals at 75 or 100 x revenue this was reported in an article by the information tiger global told their lps in a webinar earlier this month that it would no longer focus on backing late stage startups preparing to go public instead they will focus on two things going even earlier into series a and series b rounds and buying shares of public tech companies that have sunk in value compared to the all-time highs obviously we know twillow zoom block all down over 60 percent from their one year highs i could get into more details here but let's stop for a second and chamoth what are your thoughts in uh the dot-com bubble it took somewhere between three to five years for most stocks to bottom and they bottomed i think peak to trough somewhere you know towards 80 of where they were in 2000 right so it took three to five years to go basically minus eighty percent we did that in three months you know maybe four months and so uh the markets have become a lot more efficient over time so now that we have that reset it's pretty natural that there's going to be a very quick reset on the private market side and you know you have to go where the bodies are buried and what i mean by that in this case is the overwhelming misvaluation of late-stage private companies and so these folks don't have much of a choice they have a lot of money that they've raised before all of this happened they have a huge portfolio of stuff that they've marked up or have been marked up by others and they don't want to go through the pain now resetting so part of the easy strategic decision there is to say you know what we know this is a little bit radioactive but instead of really figuring out what the mark on these companies are we'll go to a different sort of part of the playground and play there because we don't have to go and deal with these issues and you know we can do 10 15 20 million dollar checks into early stage businesses pretty normal reaction strategically but i think the reality is that at some point in the next year or two these other companies have to get public the hope is that the market catches back up so that you can defend the last valuation and that's that's the way that this stuff doesn't require a lot of pain the problem is if you're high burn and you are counting on yet another successive round or you're at a point in your life cycle where you need to go public in the next two years if you go public you will get taken to the woodshed taking to the woodshed being your valuation might be half of what it is in your last round so there's going to be medicine that has to be taken sex there'll be medicine some people are going to have to take some medicine sacks what's your best advice being one of the great operators in the history of silicon valley as the ceo of paypal thanks jacob well i'm gonna put you up there with cheryl i mean i think that i think everybody agree the top four people can correct me here tim was a good operator i mean i i saw what you did to icq man you were riding that that bad boy down that wasn't easy i delivered a billion [ __ ] users to a company okay pretty decent um you did pretty good at facebook i'll say that but if i would think most people would say sax cheryl tim cook keith for boy we'll put that aside for the debate in terms of operating throwing a little dark spicy barbecue pork here come on give me a kiss i'll put you in the top 25 chamoth okay but i mean it wasn't your was it your chosen career a little dark meat a little dark meat nice god please don't get me in trouble man bring me into your start me bro you're orbiting i'm stepping back j cal who are your top four cheryl i pick my top four in this order i'll give it an order so basically for white people when uh asian and indian ceos run most of the tech companies and stuff i'm talking about number two ceos not ceos just for the ceo position to be clear i'm not talking ceo i'm talking co i would say tim cook when he was steve jobs that's my number one operator last 23 years number two i put cheryl sandberg who did obviously amazing things for google and then facebook right those two would be my top two and then i tie my top two sacks uh as uh at paypal uh and zenifitz even though it didn't work out it was still a great run at the time and then i put keith reboy square uh and a couple of other companies he did those are my top four anybody else want to come at me go ahead i don't have complete data set on cos where would you put sex you uh did i put you over and disagree who might have disappeared oh and was it keith adams linkedin brilliant you are jacob lately that's a love fest now you and friedberg are at each other's throats so i'll just let you guys fight it out and i'll be all about the love yeah freeba why are you attacking jake cal yeah as an operator extraordinaire what's your best advice to the company that raised 100 million and let's say their valuation is now not a billion it's 500 million what are the steps you take you got 14 months of runway in the bank do you lay people off do you extend it to 24 what are your thoughts you must be dealing with this with companies in your portfolio well there's a few things going on first of all i think tiger built a great business in providing late stage sort of passive non-dilutive capital to to companies sas companies we have a bunch of of uh sas businesses that they provided later stage financing i think those valuations are gonna come down i don't know that they're gonna be such a great partner for series a firms because they are passive and you know what we see is that series a companies need a lot of help they need a lot of advice you need a lot of help with recruiting governance governance they need you know when they're going from say 20 employees to 100 they need to know what that org chart looks like and on and on and on so i don't know that if this report i don't know if this reporting is actually true but if the goal is all of a sudden for tiger to become a series a investor that competes with craft or sequoia or these other firms that are not very hands-on that doesn't seem like a great strategy to me i do think that for our later stage companies they have to realize that you know if they raised can i take the other side of this sorry david i just want your reaction to this i think it's going to work but not for the right reasons the reason it'll work is there are way more entrepreneurs now than there are great entrepreneurs and so of all of these entrepreneurs that exist the idea of getting passive money where you won't get fired where there is that remember like remember when we were growing up in silicon valley the risk is always like if you take sequoia benchmark you know social capital like there's a high bar for that capital which means we are helping you run this business effectively and there's a cost where if you don't perform you'll get fired there's always been that risk it's true and i guess that's the argument they could make but the flip side is that there's a lot of so the ceo now why would you take a 15 million dollar series a check from sequoia where they could fire you whereas 15 million dollars from tiger they may never call you we we address that by doing look if a founder is really worried about that we address that by giving them three board seats you know we might have one they might have three i mean my view on it is you just never fire a founder unless they've done something criminal it's just that simple but um so look i think there's ways of addressing the governance where uh you can get the help or the value out of an early stage firm without giving up the control so yeah i mean look that's the pitch that tiger would make but i think that's addressable uh what do you think of that pitch fredberg i will give you the 15 million dollar series a you don't have to have a board you can just be passive and let us know how it goes give us a quarterly report we'll look at the p l that's all of crypto now anyways that's true well i mean that's a fair point no governance in crypto is leading to a lot of weird stuff i can tell you i tell people this a lot so i had um three term sheets for my series b uh it was from andreessen horowitz coastal ventures and founders fund and founders fund came in kind of last minute but i went with coast law uh even though it's a lower valuation because vinod was pretty insistent like let me put someone that could be useful some you know government person because we were doing a lot of work lobbying in in dc on your board we won't be on your board we won't bother you and i took the round and then my series c i took from founders fund because brian zingerman who's obviously a good friend um you know made the case like look uh our model at founders fund is we let founders run the business we're not here to tell you how to run your business and they were both great fits and you know it worked out well i didn't i had i have had experience with antagonistic vcs on boards and um you know it generally creates a pretty negative dynamic now when i was the worst story without the person's name i don't think i want to go public with it so i'm not going to do that um but when i was on give us an idea of what the behavior would be because there are people in the audience who want to know what is bad behavior of vc just give us a composite when you're an entrepreneur or ceo running an early stage business you live that business 20 hours a day you know the details if you're smart you're thorough you're analytical you're creative there is no one that's going to come in the boardroom for two hours a quarter and suggest things to you that you haven't thought of there's no one that's gonna come in the room and be smarter than you at your own business and so more often than not vinod's been exceptional at defining this problem the problem is vcs join a board and they think that they have to quote add value so they come in and they make a bunch of suggestions and recommendations and push you to do a bunch of things and as the node has said correctly many times they more often than not add negative value they can actually destroy and damage a business because they need to feel like they're exerting some degree of influence over the business and as a result they push the business to do things that the ceo or founder otherwise wouldn't be doing and that often ends up in a kind of weird sticky kind of place so i just validated the tiger pitch right there i think that's right and by the way it's why founders fund founders fund is fantastic i don't know if you guys are lps but their investment returns are so far beyond what i think anyone really realizes they're incredible investors and a big part of it is they try and find the entrepreneur that doesn't want and doesn't need the help and then they give them the capital to go and execute and they leave them the heck alone and they are just so good at finding those folks identifying them and then literally being passive in in how they kind of manage and operate their business and that's why they're so freaking good i think the people you're talking about are a lot of rookie vcs who come in and then yeah they they think that not just just experienced ex operators even people who ran businesses who say i know how to run a business and look no two businesses are alike so maybe the way they ran their business with their team and their market and their industry worked well for them but now when they got to come in and do it with someone else's business and some other space with some completely different team you know they try and exert influence and really it's just you know not wanted let me go to sac sacks hold on i want to just get one from you give us an idea because you've been in the business for over 20 years uh i mean by the looks of it maybe 40. but 20 years of just crushing it in the business what's the worst behavior you've seen on a board you can make a composite of like a vc being destructive on a board yeah i mean look i think sometimes vcs will have sort of hobby horses and they'll keep pushing for things that the founder doesn't want that's not productive but what i would say is first of all let me just say like i'm not somebody who likes to take board seats and i i do it as a it's like i see it as a cost not a benefit to me because it takes up my time if i didn't have to ever take a board seat that'd be a great as far as i'm concerned that'd be a good thing i'm not somebody who wants to you know insert myself and get on these boards you know offer it as an incentive no i only i only took more sales yeah the only reason i'll ever take aboard c is because i have to do it because the founder insists that otherwise they won't go with i've seen it so exactly then you'll do it for one year right you'll say hey i'll do it for a year i always time limit it now because i just can't i mean i can't make a ten year obligation you know it's typically like one or two years and then you know we'll see doesn't mean i'll roll off in two years but um but i but i need to have the expectation set up and and the reality is if the company can perform well for another two years they'll be at a different stage and maybe they won't you know need my help as much so the two most valuable pieces of private equity that i own is a company called dcg and it's a company called netscope and collectively it's like billion dollars worth of stock that i own what i'm on the board of one i'm not on the board of the other anymore and i text with these guys maybe once every two or three months at best so you know completely confirming david your point that great founders are just n of one individuals you know barry silbert um sanjay berry next level guys but that's very different than the the series a playbook because when i ran institutional money i'm telling you there is a pressure to be involved and show some value and i do think that there is a level of judgment on the ceo that has happened now maybe that's changed historically but i think that's the single biggest pivot that one would exploit if you were tiger or co2 or d1 stepping into the early stage game which is to essentially make it a feature and it's not dissimilar to when dst and yuri milner entered the late stage round you know what was his big differentiation i'll take common stock and i won't take a board seat i didn't see it to be influential it seemed so counter-intuitive and so against the grain but he acknowledged what was this thing that up until that point was true which is common and preferred converged in price per share so buying common in a late stage company was the same as buying preferred yo well that's something you should explain for a second people don't know you said at an ipo well let's start so when you set up a company you have a price per share of the common stock and then a price per share that the series a investor has the series a investor is buying preferred shares that actually looks more like debt than equity and what i mean by that is there's typically a coupon there's a rate of return there's accumulated dividends all these features give it a certain price per share and the common has none of those features and so it has a lower protective provisions and that gap is typically around 20 to 1 when you set up a company okay and that's what allows you to hire employees and give them very very cheap options with embedded upside then what happens is you raise more and more of these series b series c series d these preference stack right preferred shares build up but the value of the comment keeps rising too and by the time you go public the gap converges what yuri realized was hey wait a minute i'm buying a company a year or 18 months before it goes public the price of the common and the price of the preferred are roughly the same and so i'm just gonna you know do that and i'm not gonna take a board seat because it's clear this company is successful so similarly for tiger d1 and co2 i would just observe the obvious and kind of put everything that we've just said on the table which is hey guys i'll give you the money you're either end of one or not i'm making a guess that you are and i'm just going to get out of your way and leave you alone bundling governance and advice unbundling the governance and advice piece from the capital piece but you're going to still need that governance and advice piece i think i think it could work yeah i mean i think there's a lot of great founders or their founders who start young and experienced become great and the smart ones listen to advice on the way and they they seek out people who've done it before and so you know yes they may be in no one business by the growth stage but that doesn't mean they don't need any help whatsoever at the series a stage such a good observation yeah and look i think there's been i think there's been an evolution in silicon valley i'd actually say there's been like three distinct phases in the venture capital world and i remember all of them so you go back to the the night the late 90s okay when you know you had this mentality on the part of vcs that if a company became successful you would just automatically replace the founders right you go bring professional ceo upgrade that was a disaster okay and and that's when founders fund peter came in i think founded um founders fund in 2003 and the reason they called it founders fund is to indicate they were going to be pro-founder and they would never replace the founder and they would let you do whatever you wanted and i think zachary you want to tell the backstory of the sean parker stuff and how that happened yeah i mean so basically both peter and sean parker had you know experiences they felt were very negative with sequoia and by the way i have a great relationship with sequoia roloff who worked with us at paypal is there and i think they've evolved as a firm so i'm not calling them out or anything but but both sean parker and peter felt like sequoia pushed out and replaced and so with plaque so specifically there were a couple of different companies involved but when peter was uh ceo of paypal as well that you know he felt he felt that pressure as well so when they then founded as two of the four founding partners of founders one back in 2003 the whole point was we are going to be pro founder you're never going to replace you will let you do whatever you want i think that that was phase two and that became i think the dominant model and so becoming pro founder was now table stakes and i think the third phase has been you know what andreessen harvest has now done with this massive like the services and the value add which is that we're gonna basically not only be pro-founder but we're gonna like bring all these resources to help you and that's the era we're in right now i mean from the from our perspective like as as craft i mean look it's not in our interest to get into any dispute with a founder and if we feel like our advice isn't being taken well we just back off you know of course we're pro founder like we don't want the control we're not control investors and you know if it's if it's becoming frictional we'd rather just get out of the way no it's just not working the underlying thing that you're not saying though is because you have enough of a fund that's large enough where you can have enough bets where any of these any of these things to the upside is a total needle mover but anything that goes to zero doesn't actually diminish the fund or impair it meaningfully so there is no upside to getting engaged and really being non-anti-founder so yeah i think it's a i think it's a part of a business model but one thing i want to tell you about parker parker was single-handedly incredibly responsible for keeping zuck in the seat when he was president of facebook because parker wrote you know uh this structure that really allowed mark to keep control super voting shares sax to add on to your your point i think that there's been uh so so it there seems to be a bifurcation around the services model or not but the fourth thing that seems to have happened and you guys tell me if i'm wrong on this but it plays into the tiger global story when i was um uh when i got that term sheet for my series b at climate corp marc andreessen i was trying to raise like 25 to 30 million dollars and mark anderson was like we're gonna give you a turn sheet for 40 million dollars more than you were asking for uh because we want you to use that extra capital to go faster to go harder to grab the market because we have this big pitch in businesses grabbing the market and that seems to have also become a bit of a mainstay but not just a mainstay but now almost like the the the kind of standard pitch that a lot of the later stage guys are taking which is like here's so much capital that it helps you make the market and then the softbank vision fund kind of took that to the extreme with 100 billion raise and tiger global i think last year have publicly said they deployed about 15 billion dollars into startups where startup may in a natural cycle kind of evolve to needing 70 million raise or 100 million raise and they're like writing checks for 250 or 300 and saying this extra capital gives you the ability to move faster and the reason is the faster a business moves the higher the multiple they get on their revenue so the higher the growth rate the higher the multiple so if you can deploy capital faster if we could find a business where we can pump money through you to get it out the door faster your multiple goes up and tiger's model was let's just get the multiples up there's multiple expansion and growth so we'll make money two ways when the company goes public in 18 to 24 months obviously when the markets end up tanking and all those multiples compress no growth rate is going to solve that problem for you um but having more capital than maybe you were thinking or asking for also seems to have become kind of an attacking i don't know if that if you view that as kind of this fourth evolution but that certainly wasn't the case 20 years ago when vcs were being careful about is it a six million dollar round or an 8 million what's the right amount of capital and nowadays it's much more about take more than you need i'll say there was a 3.5 in there which is you saw a little bit of lack of governance or superpowers on the part of like some incompetent founders or bad founders just you know whether it's we work theranos whatever too much control not enough governance things go off the rail but you know based on this discussion i really think this bifurcates when it's a first-time founder versus a second time founder in what i see because i have been doing board training for seed companies where i will just have three founders sit in on each other's first board meetings we do one board meeting each and i train them how board meetings works and what i experienced with sequoia on my board and other boards and first-time founders like the tactical stuff how to run a board meeting legal hr hiring partnerships go to market strategies man it is all tactical all the time and then when i've been on with second and third time founders you know they really are like here's all the materials here's what i'm thinking about what do we think strategically so they go from the tactical level to the strategic admission level awfully quick and they actually seem to enjoy having those four meetings a year whereas the first time founders really need to have six to ten a year in those in that first you know call it year two of a company that's my experience i realized in this discussion that the market has really meaningfully changed meaning when i was actively investing even in the early 2000s or sorry in the in you know 2011-1213 there was a culture where if you underperformed you would get replaced and i think david what you just spoke about which i guess is true has really changed which is if you're running a multi-multi-billion dollar fund where every check is 20 million dollars the upside is billions but the downside is negative 20. there's just no point and so you know sequoia used to be known as a very very very tough tough tough place for ceos that were underperforming now they got a nine billion dollar fund now yeah maybe less than 10 years ago i think it was i think it was known as a very tough demanding place i think benchmark was known as a very tough demanding place because the money was much more finite right benchmark still still that case yeah i mean the expectation culture they never they never grew their fund size no jason you're not you're not hearing me yeah i am i think what's happening is listen i had sequoia on my board and i worked at sequoia so there's difference between high expectations which i think all these folks have to have and the willingness to replace the founder as ceo and what i'm saying is every vc claims this but there were a handful of vcs that had the courage to do this i mean famously mike morris and john doerr you know had it out with larry uh at the you know right right after this round like either go public you know get your business model or give us your money back famously at google so they're not they're willing to draw a line in this end i think that that has fundamentally changed at all these organizations because the fund sizes have gone up and the and the mathematical reality of venture capital has changed something else you're missing which is you got to remember moritz and door were not operators and now these companies are being run ruloff is running sequoia and he's an operator and he was there so the changing of the guard and mark andreessen and ben horowitz were operators so the operator class behaves very differently i disagree with you i think that it functions respectfully no hold on i think that fun size dictates this behavior more than any singular other feature when you're running a nine billion dollar fund you just don't sweat that changing of the ceo and david said it really well you just say okay i'll cut our losses and move on we don't lose i think it's more about the culture change in silicon valley of a bunch of mba finance people who have never run a company now moving and running companies but you know let's move on to the next any uh closing thoughts on this one well just i mean jason you start to make this point that if you're a founder and you want to eventually run a great public company when you ipo guess what you're going to have governance and what i've seen big time right i mean there's just delaware law there's just a lot of like expectations around being a public company and so if you don't have a board you know and you're not constituting one until you go public there's going to be a massive amount of cleanup that you have to do i mean that's what i've seen and so you'll end up scrambling to create a board i think that the board serves so many purposes early on of giving you advice of giving you structure of providing support help services you can still remain in control while getting those things and i'm just i'm just skeptical that like if you form a company with completely passive vcs you don't even serve on a board like you're gonna have to do a lot of cleanup later i'd say at a minimum totally i think that that's true too totally i'm not by the way i'm not saying i'm i advocate this but i'm i just think that the reality is that if these large late-stage crossover firms really step into the early stage i think they could really build a big book of business um i do think there are a lot of founders who would love to just be given the money and just to be left alone i'm not saying that they think they know that it's better for them but on the margin just to be able to be left alone now what has changed maybe those everybody's going to be very hands off just because all the fun sizes have exploded so at that point then you know what is the difference between sequoia and d1 time will tell i just know that like when i see a founder doing something that i think could risk the company going off the rails i'll say so and then you know if it keeps happening and the situation gets worse i'll say so again i might mention the third time i might not at a certain point i'm just like maybe after like two times i'm just like they don't want to listen to me that's fine it's their decision their company their decision they go off the rails their problem you know we'll move on to the next one i mean that's the reality sometimes founders have to learn by doing it like sometimes their intent and you know what they could be right and you could be wrong too so it's hard as a as a it's hard as a board member you know that's why i'm very judicious in giving advice as a board member now and i'm on a bunch of boards and doing word training because when roloff was on my board and he still is you know he would ask great questions and he would be very thoughtful about hey have you thought about this or when i got advice from doug or michael moritz directly you know doug would say hey well can you share the two-year plan with me and i'd say you know we haven't built a plan and he said well you know jason you know hope is not a plan let's make a plan and let's discuss you know the milestones along here and it was amazing to have that level of thoughtfulness around total vision as a founder i love i mean as a founder i love getting advice and i think you got to be really dumb not to seek it out i mean i when i was a founder i would even though i was sort of competing with benioff i would meet with him and i would like get amazing tidbits um just recently we did it wasn't like an official board meeting because roloff isn't on our board but he's a big investor in one of my incubations colin and we just did a meeting with him and and uh and gets it in every time not to be confused with all in but no yeah not to be confused but we have a trademark it was it was me and axel who's the co-founder of paulin and um and roloff and we had like an amazing meeting where we got like i'd say amazing advice from roloff that like focused us and it wasn't that i didn't know these things but it's just like when you're in the weeds sometimes you don't necessarily crystallize on focus on the most important thing and i came out of that meaning feeling like okay roloff just refocused us on the most important thing and it was immensely valuable and you've got to be like dumb not to seek that out no matter what stage you're at because i seek it out today yeah and think about this david you're in the thick of things he's on square's board he's on other boards he's got a picture of the entire playing field it's like somebody who's the coach of 15 nba uh teams and you're like the coach of one he's seeing things on other nba teams that they're doing in methodologies and best practices that you're just not gonna see so i mean again and then if you look at the great founders tk used to come to me uh and say hey you know this is the thing i'm gonna be doing at the next board meeting or here's the thing can we jam out and he would just ask for a jam session he came up with that term and three or four people would get together and just jam and talk for five hours about the product it was awesome all right let's go on to uh david saks's favorite section of the show science with the sultan of science himself oh oh i thought you were going to say his favorite paul graham oh enough with that ooh we can't talk about that that was exactly exciting you have to you if you are engaged in the science segment david sox and pg are in a fight all right let's cover it here's the deal if david sacks is engaged during the science portion of the class we will let him have his fight uh as the as the teacher here tell us a little bit about stem cells and uh this hiv story i was going to tell sax that the the earth is round okay it's not flat i don't care yeah um how does that affect solana so sorry the story that i think we wanted to you guys wanted to cover today with the hiv story which um incredible i suggested this topic so i'm interested explain it to us hiv is a retrovirus meaning once you get infected it doesn't go away he doesn't care he's he's flipping through his politico notes to figure out what did he miss saying that he was supposed to say today he just flipped over to ben shapiro on 2x he's listening to jordan peterson and sam harris in conversation go ahead okay okay the the hiv being cured headline uh you know we can dive into it for two minutes but hiv is a retrovirus when you get infected with hiv it stays in your body forever it actually ends up living inside of your immune cells that's what makes it such an interesting challenging virus and it destroys those immune cells so over time you end up getting aids and the way it enters the immune cells is through a specific protein some people have a genetic mutation where if there's a change in the their dna and that protein is different hiv cannot enter their immune cells and they can actually they are naturally immune to hiv ccr5 yeah and so what's happened is um found apparently in white northern europeans yeah like norwegians i think yeah exactly and um anyway so what's uh the interesting study that was done um all immune cells are made from stem cells in your bone marrow and so you know all the white blood cells that we have that fight off our diseases come from our bone marrow and um when you get a blood cancer sometimes you end up getting so severe that you have to actually wipe out all the immune cells in your body and give yours and you end up with a bone marrow transplant so you get new bone marrow put in your new blood cells put in and hopefully if you can survive the therapy and survive that treatment those uh that new bone marrow will produce new immune cells and your body will recover and you will be cured of your blood cancer so what happened is people had hiv and when you get this uh this bone marrow transplant you end up you know they give you radiation and chemo and they wipe out all your blood cells um uh and and then they give you this bone marrow transplant so they selectively chose um bone marrow stem cells that came from people that have the uh the genetic mutation uh that uh that prevents hiv so then when these hiv patients that got blood cancer got a bone marrow transplant with this mutation in it they were cured of hiv um and so it's a pretty profound kind of demonstration of what we already knew which is that this genetic mutation can can prevent hiv and there are a lot of therapies that are underway right now to actually use gene editing to induce that mutation in people's uh blood cells and in their bone marrow without needing to give them a whole transplant the the first guy that did it the first guy that did it was german right or he was in germany i think and he unfortunately passed away uh they cured his his hiv aids but he unfortunately had a relapse of the leukemia that killed him but i think all three cases of people that um that have been quote unquote cured uh have have been these leukemia patients but i'll say two things two things about the future of this kind of possibility number one is you don't need to get a bone marrow transplant to have this um mutation induced in your cells to prevent this infection from uh kind of occurring in your body you can use gene editing tools to do that and so we are now developing genetic therapies where rather than go and get a whole bone marrow transplant to cure your hiv we can actually edit your cells those edited cells will now be resistant and you will be resolved of hiv the second thing is the way that they gave people the bone marrow transplant the way they created those stem cells for the bone marrow transplant was from umbilical cord uh blood from from newborns which is very rich in stem cells and this is a traditional way of kind of giving people stem cell-based therapies is you go and source stem cells from another body or your own body which are called autologous stem cells but like i just want to say one thing what's really interesting in the future is not going to be about pulling other people's stem cells into your body and finding them from you know fetal blood or what have you we now have the technology which i've talked about multiple times on the show called yamanaka factors where theoretically we can take your cells from your own body turn them into stem cells grow them in a lab and use that as the therapy that's called autologous stem cell therapy and rather than use stem cells or trying to find them and circ you know figure them out where they are in your body and pull them out we can actually do stem cells for your body and that's like you know 15 years out is um autologous induced stem cell therapy where you actually make your own stem cells and then give yourself all sorts of therapies not just bone marrow transplants but you can heal lots of tissue in the body using these stem cell systems we don't really hear about hiv aids anymore in that article i think it said that there's about 37 million people around the world that have hiv aids and it's incredible actually the amount of progress that science has made in this disease i remember when i was growing up it was made to to be like this incredible boogeyman yeah um and it really governed like a lot of social norms at the time because we were still discovering what hiv aids was and you know how you know how do you think about sexual uh promiscuity you know from a moral and ethical perspective um i think it had a huge impact on my generation absolutely it did it was a death sentence they they made us paranoid so here's what's happened therapies have gotten so good at suppressing suppressing the virus if the virus is suppressed far enough even though you are always going to be infected if it's suppressed far enough the who and the fda have both said you can still have unprotected sex and not transmit hiv and so even though there are plenty of people out there that might be having unprotected sex with hiv um the therapies have suppressed the viral load to the point that they're not transmitting it actively and so that's been the big breakthrough in science over the last decade and then they also had these prep pills right which people could take proactive if they thought they might you know find themselves but i mean champ you and i lived in a generation where i mean that was exactly it was the end of things yeah well i mean it was the end of days and they're like i i don't know it was a single biggest thing that i was that i was taught in sex ed classes to be afraid of being really scared at all and then the problem that it that it created was like you know in countries that had a large catholic population um you know the catholic church was so you know uh evil they had they were undecided on um they were the opposite side they told people in africa to not use condoms when aids was rampant it was the biggest evil second biggest evil the catholic church did in modern history obviously the first we know i have a contribution to this segment oh god you know what he's wrong i know your point is relationship look i i remember how scared people were of aids you know back in the 1980s when this came up and i remember that there was a head of the nih who even whipped up people's fear hold on people's fear by saying that even casual even casual contact within the same household can spread it and you know who that happened yes we know dedicated his life to trying to solve and reduce the suffering of saw for aids and hiv no in the 1980s in the 1980s he was the face of government indifference towards aids and he spread fear and was medically wrong about it go check the records he was a screw-up then and he's a screw-up on it he worked tirelessly he didn't work tirelessly on it jkl i think saks is right in the sense that like what we thought we knew back then turned out to be wrong and i think that's a really important point you know particularly in science it's a process of discovery what we thought we knew back then turned out it was all a hypothesis it's all a thesis until it's proven or disproven and that's the case read andrew sullivan i mean you know fauci was absolutely the enemy public enemy number one of the of the game who is it tony tony yeah well it was attorney tony perkins there was actually a debate that fauci was in uh on aids where a gay actress literally said to him i hate you and if you read andrew sullivan's blog he will talk about how he remembers back in the 1980s that fauci was sort of public enemy number one in the gay community because of his position on this during the reagan administration and so it is a lot of civil disobedience act up except remember and he responded by putting massive resources into this so i think you know if he was that's not listen listen to andrew sullivan on this thing he's sullivan he is not that right wait andrew sullivan is the reason why more than any other public intellectual why we have marriage equality today he is number one he advocated for marriage equality and in the new republic made the case for it before anybody else and popularized that argument yeah i'm a fan of his writing uh let's not say don't try and portray him as a far right winger or whatever portray foul you're you're going to fauci's intent and you want to believe that she's an evil person i think you and many other people have mysteriously forgotten who fauci really is okay you think i know the conspiracy you think fauci's intent is to you know cover up the uh intentionally was working against uh solving for hiv that's ridiculous do you think i wouldn't say intentionally do you think fauci had good intentions yeah if you infer that sex do you think factory had good intentions i don't i don't really care about his intentions i just want to look at his actions it's amazing it's amazing it's amazing to me that a public official who was so wrong back then in the 1980s 1990s on the public health crisis of our time would just be given a free pass and along comes a new public health crisis the last couple of years and he's been completely wrong about that too so why are you giving this guy a free passion i don't get it hey in a cloud of uncertainty in a time of war do you think that leaders need to show strong intent and clear signals or do you think that they should be wishy-washy because they don't know enough i think they should be right and if they're trying the best with what they have with the information they have at the time okay well yeah there's some forgiveness for uh for making mistakes but when you're constantly wrong maybe it's time to get somebody else in there and look but and falchi by the way fauci with respect to code we talked about it before 100 participated in a suppression of the investigation into the origins of kovid there was an active attempt to suppress that come on you know that the the foia emails show it it's a good science segment i do want to give a shout out to the the researchers uh who actually did this with this woman uh in new york it's pretty freaking incredible what's incredible is that they did it with um hiv patients who had blood cancer and it was a really kind of like thoughtfully designed experiment um incredibly thoughtful yeah and it's been four years so i mean this has been baking for a long time by the way as i zoom out and hear you guys talk about what hiv was like you know back in the day and the fear around it i i do think that 30 40 years from now given the tools we have with induced stem cells and cell-based therapies and there are hundreds of cell-based therapies coming to market over the next few years they're all in late stage clinical trials as well as gene editing i think hopefully and i'm optimistic that one day we will look back at cancer and aging in the same way that we're talking about hiv today and that both of those diseases can and will be resolved with the tools that we're developing through science and you know there's there's going to be bumps along the road but man i you know it's so clear that he's going to go look i think i think what freeberg just said actually is really important and inspiring and i think it's great and i was kind of joking around with the fouchy thing i didn't expect it to become a tangent so i don't need to keep going on where do you see him in editing trying to change his position no i'm not going to change anything keep that whole segment i'm just saying i didn't can you use could i do a voiceover change you haven't become so argumentative we wouldn't have spent five minutes on it if i can correct your incorrect position that she's intentionally on-ramp please because i gotta fly to europe go okay here we go david sachs and paul graham have gotten into it uh it's a battle for the ages and the stakes are so low the stakes are so high and the animosity is so high because the stakes are so low uh here we go wait before this uh does phil hellmuth qualify this as a billionaire battle or uh literally he revealed the billionaire if you follow phil hellmuth's account it's being d.a greatest being dog greatest on twitter follow being d.a greatest to get that fella no phil hellmuth outed he on his twitter our friend his new billionaire bestie is um his bill which he stole bestie from me i used to call everybody best day he just co-opted it uh like he co-opted me calling tremont the dictator but i'll tell the dictator origin story later is stan lee from doordash stanley tang co-founder chief product officer of doordad great guy really great homeless ladies truffle exactly we found it okay here we go so if you can introduce them to paul graham go ahead sex all right here here here's the issue to pick what's your beef here we go actually i did not seek out this beef saks vendetta section of the pot no no listen any billionaires out there who want to like debate like come waiting into my tweets mark cuban didn't make it made a big ass to himself i don't want to deter these guys from from waiting in because it's great here's what basically happened is i tweeted a video of all these multi-millionaire celebrity hypocrites partying massless at the super bowl and then meanwhile the next day my three kids have to go to school in california wearing their masks that is ridiculous okay it makes no sense we all know that okay any sane person knows that that's what i tweeted about i don't know why of all issues that was triggering a pg but he had to come in and say well they were all partying outdoors it's like really uh it looks to me like they're in a sky box and if it has three walls and a ceiling i call that a room uh but in any event that wasn't he was he was misinformed because the rule of the super bowl was that if you were not eating and drinking anyone under over the age of two have to be wearing a mask um so you know my point stands i just want to err so here here's where things kind of went south is um is so then i tweeted uh blink twice you know paul and and here's the thing i wasn't totally trying to be snarky with that comment um here here's why i said that is because explain what that means i didn't understand that what does that mean blink twice well it means like you're a captor you're being held kidnapped by these concepts that you have to wear no you're being held hostage by somebody and the reason why i said that is because is is look if if pg had just been some crazy dumb person never would have said that the fact is that pg is smart he writes extremely well publishes a lot of interesting things he's an independent thinker so it almost seemed to me like somebody is holding him hostage here because how can this really smart person be making this case anyway it kind of went south from there so oh i i have no desire to continue that meanwhile kendall jenner wore north face shoes to justin bieber's uh what yeah can you believe dear she knows that how did he do that gossip gossip gossip all right so this has been sax's corner for the week uh can we make this a regular segment but i'm making this segment but i want to say i want to stay on the main issue here which is oh please let's do it every week but yeah but look am i wrong about this masked hypocrisy that's going on how in the world are you kids picture of sacks in the mess no no no no sax in the match i'll stop i want to air 100 support for saks on this statement i totally agree with you on the mask hypocrisy as well as the mass mandates in schools i think it's ridiculous we've pivoted so far away from first principle thinking on this stuff it's nuts i totally agree with you completely and um on this point on you wasting your time fighting with people on twitter my personal advice to you as a friend it's just cut it out but do what you gotta do buddy but totally agree oh it's entertainment all right everybody for the dictator himself chamath palihapatia man yeah david sachs and the sultan of science if you see him out and about ask for a selfie sultan of science love selfies he does love you boys bye we'll see you all next time on the all-in pod bye-bye love you besties bye-bye let your winners ride rain man we open sources to the fans and they've just gone crazy with it [Music] besties [Music] we should all just get a room and just have one big huge orgy because they're all just like this like sexual tension that they just need to release somehow we need to get back i'm going on [Music]








[Music] and they've just gone crazy with them all right everybody welcome to another episode of the all in podcast episode number 70 we made it to 70 episodes which is just shocking to me and we're recording a little bit earlier uh because one of our besties uh had to change their schedule chamath and um it's a crazy day to be doing this last night putin decided to invade the ukraine late wednesday night early into thursday morning putin started a special military operation in quotes to demilitarize the ukraine and we've been watching this build up for weeks you're missing it he said to demilitarize and deny supply and de nazify yes of course um because the ukraine was filled with so many nazis uh his trolling continues i guess just starting it off um sax you're a big putin fan uh along with trunk and uh you're the right wing so tell us how glorious is uh this invasion for the republican party well it's it's it's interesting what it's well that's funny but it's also it's also kind of sad because what you're doing right there is exactly what the whole twittersphere is doing which is anybody who wants to actually de-escalate and defuse this war before it escalates and metastasizes in something much worse it gets denounced as a putin apologist i have no dealings in either you know russia or ukraine for that matter ukrainian cash is not lining my pockets like many of our politicians their families in washington i have no interest except preserving the safety of the united states of america and the point is that i think biden the one clear elusive point that he made in his last speech i know he's giving one today is that the united states of america would not intervene militarily in ukraine we should all understand that he made it very clear the troops that were being sent over there were to defend our nato allies ukraine is not one we do not have a treaty obligation to defend them what is happening right now is tragic putin is the aggressor it's a humanitarian disaster i do feel bad for the people of ukraine our thoughts and prayers are with them however we are not going to intervene militarily in that conflict nor should we because we cannot risk starting world war iii it is not a vital american interest who rules the donbass in a way that it is a vital american interest to avoid a war with russia and the tragedy here the second tragedy is that we did not do everything we could to diplomatically try and solve this problem and what do i mean by that on this pod three weeks ago i said that ukraine was never gonna be part of nato why because biden has said it we can't defend them militarily against russia we were never gonna admit them why didn't we give up that card that i'm we don't know for sure what would have happened but if we had been willing to basically affirm that we believe in ukraine's sovereignty but they are not part of nato that might have diffused this conflict i think we had consensus on that we said like hey what if i think actually i suggested what if we set a five-year you know moratorium on them joining or something absolutely put that out there can i just have sex one question on this okay yeah sex do you not think that the us you know regardless of the obligations under uh um nato faces a little bit of an issue on a global stage where you know we we told this leader back down don't do this and then we don't respond militarily that that action effectively reduces america's influence and credibility when it comes to these sorts of defensive statements in this kind of global theater and our primacy is being challenged because we laid down the law we said this is not allowed you cannot do this there's going to be repercussions and then it happens and there are economic sanctions and you know maybe we'll talk in a second about some other potential repercussions but by not doing something militarily we weaken ourselves and we weaken our position and it gives permission to others to take action that maybe counter ultimately to kind of the us interests abroad okay so in response i have to we'll quote what barack obama said um and we've mentioned this on a previous party he said the fact is that ukraine which is and this is back in the the atlantic interview he gave the fact is that ukraine which is a non-nato country is going to be vulnerable to military domination by russia no matter what we do this is an example where we have to be very clear about what our core interests are and what we are willing to go to war for the fact of the matter is none of us on this pod want to send our sons and daughters to go fight and risk their lives and die to determine who rules the donbass or even ukraine we sympathize with them we may impose sanctions on their behalf we may arm them militarily but we are not willing to fight and so therefore us trying to lay down this law to putin was a bluff and he called our bluff and the smart thing we can do right now is not to escalate look we've already gone to the river he's you know we basically tried to barrel and bluff him at every street we got to the river he has now invaded we're now in a showdown what do you want to do now you want to escalate this even more the only way that we could make this worse is to precipitate a world war now if our absolute priority our absolute priority right now should be to make sure that this war doesn't spread my prediction is as of right now it would be very unpopular to go to war uh or for the u.s to enter the war uh in a um on the battlefield i i do think and i don't know if we're gonna hear more about this today but i do think that the cyber war is beginning today uh the united states has talked at length about having uh you know a tremendous cyber capabilities and my understanding is as of this morning a number of state websites were down in russia and a number of um uh you know russian cyber interests were under attack and so we may see the u.s kind of confront russia on another battle stage not on the uh you know on the field on the physical field but if over the next couple of weeks this continues their days and i was just looking at cnn this morning and bbc and there were these images that started to come out of like you know ukrainian um airplanes that that had been downed and if you start to see images of children um you know helpless children buildings being bombed bodies strewn on the street does that not change kind of the american opinion on whether or not we should do something here and will that not kind of lead us potentially into a war that you know today i think we all you know or many people would say strategically doesn't make sense economically doesn't make sense you know we're only going to lead to kind of escalation but don't you think that american opinion typically changes when imagery arises when you know the sort of brutality of war well i mean that's why out of some wars and we have in the past yeah but even today it's like the first day and there's like these really gruesome awful photos coming out and i i could see people getting sympathetic to that and starting to kind of you know bang the the wardrobe saying this is ridiculous we can't let this tyrant do this it's awful well it's already it's already happening you know but this is why we should not conduct foreign policy by twitter we should not twitterize the situation yeah this is when this is when cooler heads need to prevail the fact of the matter is when soviet tanks they rolled into hungary in 1956 or czech slovakia in 1968 to cross the frog spring or poland in 1981 across solidarity we did nothing because avoiding war with the soviet union was more important even though we sympathize with those people and in 2008 we've been in this situation before 2008 georgia the republic of georgia putin invaded on behalf of these breakaway russian sort of dissident uh provinces south of city and abkhazia why did that happen well if you remember back in 2008 there was a lot of talk about georgia joining nato and you had you know the warhawk senator john mccain go over there and declare we're all georgians now and so what happened all of a sudden these breakaway provinces the russified provinces of south africa and abkhazia started rebelling that gave putin the excuse to roll in there and the tanks a year later he left but there was no more talk of georgia joining nato so and again we george w bush was present at the time we did nothing militarily we just sent humanitarian assistance that was it so we've been in this situation before we should not i keep hearing in the media on cable news and on twitter this is historically unprecedented we must act no we've been in this situation before in 2008 and all those previous times we were in the situation in 2014 when putin invaded let me ask you a question zach um we we had this concept of hey maybe if we said hey we won't admit them into nato and uh do you think that if we had actually made that concession or said we're not going to let them into nato for a decade or whatever do you think that would have changed putin's behavior yes or no well it's honestly it's hard to know i mean i can't i can't prove a counter factual however i think it was tragic not to try okay i do think i think i think it should be the goal of diplomats sure to try and again as i said on a previous pod it was the sleeves off our vest ukraine is not going to be a member of nato so to give that up would have was basically giving them nothing it was almost meaningless to us and instead of making that concession what happened lincoln came out with this statement nato's door is open and will remain open it was perhaps the most provocative thing he could have said in that situation and they they would have been voted in that would have happened wouldn't have happened anyway let me ask you this question you've been complaining about the media and democrats uh banging the drum of war and you're saying they're more hawkish on the other side of the table you have uh trump came out and said that putin's move on the ukraine is genius and the guy is very savvy and then you have pompeo saying i have enormous respect for him and that he's a very talented statesman has lots of gifts and he knows how to use power we should respect that so your party uh your crew is praising putin do you think the praising of putin is wise in this kind of situation no look here's what's going on first of all the the warhawks and the people beating the drums of war is happening on both sides of the aisle and on both both both sets of cable news i was watching fox last night and they were all but you know cheerleading for war basically saying we have to go on it i watched it too yeah it's crazy we're saying we have to go on offense that what is biden doing saying that we're not going to intervene militarily i'm like watching these people who are acting you know it reminded me of um dr strangelove where you have slim pickens the cowboy riding the atomic bomb on the way down they were excited and i'm watching the cable news and all these people are acting this way and i'm like what in the world is going on you know it's it's all this is a big part of what i tried to point out our prediction show at the end of last year you know the the if a country is happy if the economy is growing if there isn't significant risk of inflation no one wants to go to war when those are not the case there's a tendency to say we gotta do something and if you don't you're anxious and if you don't have anything to do and some conflict arises that's a good place to kind of apply your energy and your pressure let me bring the dictator himself into this chamatha you've been silent thus far uh any thoughts on what we're seeing here i was letting the proletariat speak okay are you the bourgeoisie or what that sweater is very bourgeois i have to say i mean i mean sweater karen right now he is drafting she's multiple emails she's melting she's melting i think they're going to be a gofundme to revoke that sweater from you what is the story with that sweater that's what that's what trudeau trudeau trudeau will reinvoke in a state of emergency to stop that yes they go fund me i mean this feels like we're processing this chamath so quickly that the ukraine just asked on twitter today for everybody to tell at russia how they feel about what they're doing and the ukraine this is happening in real time is tweeting memes now about putin uh this seems almost surreal and is getting very strange in terms of how we're interpreting it i mean is there an off-ramp here are we just gonna have to deal with putin doing this every number of years and this is just going to be you know a year or two of you know conflict i don't know but here's what's important to um two points one is the economic sanctions have begun and the economic damage to russia i've been starting to be infected right i think germany basically suspended the certification of north stream that has a huge economic impact to russia right i think the ruble against the dollar was off nine or ten percent this morning um when i woke up here in europe so it slows down even more so um now the interesting thing about that was that i've read an article in the wall street journal maybe nick you can dig this up but this is a few years ago uh preceding this russia had built massive amounts of us dollar reserves in fact they had been depleted over like the last little crisis that they went through and then they had rebuilt all these dollar reserves so in some ways it may have been the case that these guys had this plan all along and they put some you know they built up their bank accounts just in case because they knew that this would happen the other thing is there's a quote from hr mcmaster he said that deterrence is a simple equation it's it's the product of will and capability right will times capabilities and so you know if you're going to be a deterrent on the world stage militarily not only do you have to have an incredible military capability you also have to have the will to go to wars but and i think in america you know what feedback said is i think if you pulled a lot of people um you know people are pretty exhausted after all of these different conflicts and so i'm not sure that the will is there to go to europe and so the best off ramp is to try to find some amount of uh economic pressure points and then to negotiate some sort of you know release valve from all of that economic pressure in return for some normalization babe i think that's really the best chance you know i have to be honest with you when i was thinking about the odds of this just from a financial perspective and you know whether i should be doing something different or putting something on i thought that there was zero chance that this would happen literally i put it as close to zero as possible because i thought in 2022 it just didn't seem like this could be possible and here we are and it seems like it is um i hope everybody in ukraine is safe but i think that biden's going to announce some pretty crippling sanctuaries and i think the west is going to be very punitive financially um and that's probably awkward but it depends on it depends how long about the suffer last because again like i said i think russia's foreign currency reserves are pretty strong going into this council let me let me then uh pass the ball to you sax there's there's going to be a lot of people who are going to die both russians and ukrainians sadly if this thing keeps escalating uh there's a hundred ninety thousand russian troops on the border or making their way into the ukraine is there an off-ramp here in your mind in any way do you think the sanctions will work and and god these the the poor citizens of russia i mean are they going to crack at some point and is this going to blow back onto uh putin because what did they seem to get out of this i guess is a question do the russian people support this and will they support it on an extended basis well okay so there's a few questions there yeah okay so the the fact of the matter is so so i think you're right that putin has bought himself a headache here right i mean the the the eastern parts of ukraine that are you know ethnically russian the areas of the dawn bass they will those people will support him but the western part of ukraine that wants to be free that's not ethnically russian that is going to be a headache for him to manage i don't think he wants this problem long term it's probably going to be more like the situation we had in georgia in 2008 he goes in for a year he institutes perhaps some sort of puppet government or some government that's more favorable to him and then he gets out properly this is if there's no escalation i think it's very important i keep making this point the most important thing biden can do is to make sure that this does not escalate militarily and that we do not get militarily involved i think sanctions will happen i mean that's pretty clear probably we have to move forward with that but but at the same time it will sanctions work in terms of being a strong deterrent no i don't think so there was a very good article by neil ferguson and ken griffin actually in the wall street journal talking about what we should do they made the point that sanctions don't usually work however what we should really be striving for is energy independence so 100 so yes but the crazy thing is america despite having these huge uh natural gas reserves seven percent of our natural gas is coming from russia right now so why because we stopped fracking we stopped the you know biden cancel the keystone pipeline and then in europe the situation is even worse which is they're completely dependent on on russian natural gas germans are and the uk not france the op-ed made the point that we could be investing in liquefying natural gas and exporting it to europe to create more energy independence and that would remove their dependency on putin that energy independence here problem with energy independence is it takes too long and we went through a massive capital under investment cycle over the last six or seven years and so you know in order to start this up you need to have started actually putting money in the ground six or seven years and the problem today is if we put money into the ground now that's not going to yield any sort of return on investor capital for another six or seven years and so when you look at these mad gas companies every single one to a name has basically said we are not going to put every any incremental capital into u.s domestic net gas or shale or even offshore the real solution is to actually go fully alternative and to go to renewable energy because you can today right uh deploy solar vastly more aggressively in the united states look at the end of the day the thing that is completely abundant and has the best implications all around is solar and it's gotten cheaper than coal and and and and ask yourself like why why are we only three percent penetrated in the united states right we can manufacture these panels we can deploy them broadly right now you know we're in this situation where california is actually revisiting the itc credit or the the net metering laws sorry rather which would have huge implications for the california solar market it could actually destroy that whole market and so you know we have to get really organized david to your point but there is a path to energy independence i think it's alternative energy it's wind and solar um because we can do it today and you can do it really quickly and you can basically leapfrog the entire capital investment cycle that you need to do for netcast we've already missed the training well and also you could have germany can start turning back on nuclear power plants if they could get their citizens to pick nuclear over war and that seems like a pretty easy choice it takes too long they've recently returned there's one year no they've been doing it for 20 years they've been turning them off for 20 years i know they could they that means they don't have to rebuild them they could just turn them back on you that which is it's not switch jason no but that's not how it works it's not a light switch but it's not the same as building a new one in the us that's the point they could help them back it's still year it's still years between these things but you got to think chamath the threat of doing it would terrorize the saudis and the russians if all of a sudden the eu said we are going to go massive solar massive nuclear and we're going to be energy independent just a threat dramatic effect i'm not sure any country is going to is going to really uh all have a massive reaction to any other country talking about a multi-year investment cycle i do think jason to your point solar is not a multi-year investment cycle it can literally happen in months yes and so that is much more disruptive so for example you could if you took three trillion dollars of buildback better and instead said you know what we're just going to actually put solar everywhere everywhere that would be you take three trillion dollars of solar and you put it literally everywhere in the united states i think everybody would support it you would have domestic job creation like nobody's business you would take so much carbon out of the air and you don't need to go to war enormous energy dependence well it would give you a degree of freedom so that the next time you're pushed to war you can actually evaluate it under very different um you know risk calculus than if you actually need the energy from the country to the point yeah that's the point and just for um a fact check here nuclear power in germany accounted for 13.3 percent of german electrical supply in 2021 uh france by the way 70 80 um and that was generated by six power plant of which three were switched off at the end of 2021 they literally just turned these off and the other three i know but the decision was not made yesterday jason my point is this is these are 20-year decisions no it was fukushima that pushed them actually in the sentiment of and they also had 70 percent of their electricity on a couple of weeks come from renewables so the germans suddenly thought that they didn't live in a shady area and they could get by with just solar which was a big mistake uh this turning these off germany if they didn't turn these off they would have a different approach here too you could be sure of that so like i'm a fan of solar but i'll just make the point that natural gas burns from a climate standpoint it burns much cleaner than oil and oil burns much cleaner than coal so natural gas is a way better than a lot of the alternatives and the main problem with it is that when you frack you can get the release of water well that but that's in the ground but in terms of the release of methane which is a greenhouse gas that's actually worse than co2 and so you can actually get you know methane release but in the us we have techniques for recapture of it whereas i don't think russia cares about that so we'd be a lot better off i think solar is part of the answer but i don't think we should be turning our backs on the enormous reserves of natural gas that we have here in this country friedberg what are your thoughts you're hearing three of us talk about energy um give us your science boy uh super powers here and what what do you think is the clearest shot on goal here for energy independence as an option to war i'll just point out that the notion that there are countries that are jockeying or positioning to stop the train towards renewable alternatives for energy production this century uh the number of countries in that bucket are close to zero you know saudi arabia took saudi aramco public specifically so that they under kind of mbs's strategic direction diversify away from uh you know the fossil fuel dependency of their economy and diversifying to other assets so they are going to sell down their equity interest in saudi aramco over time and invest in things you know they probably made their first bet and regret it with softbank but they'll probably make other bets to try and invest in kind of next-gen uh industries and so you know if you look at the money that's going from even exxon and you know there's a guy locally here in san francisco who ran a very significant uh board proxy fight to get on the board of exxon and he won and he's jockeying for continued and increased investment from an r d perspective in renewables and alternatives and we're seeing this across the board there's going to be in the next couple years if not already many of these fossil fuel dependent businesses and countries have or are making a massive shift towards alternative renewable sources of energy so i don't think that there's any enemy here there's no evil like all the folks that have been dependent on in the past are aware of the fact that this is not where the future is we do have to transition so the reason i bought energy stocks in december and the reason i made this point was threefold one is because we have as a result of this general consensus view underinvested in energy infrastructure and the demands that are going to come out of the ex covet economic growth cycle cannot be met with the current energy infrastructure and you're going to see energy prices continue to climb coupled with the fact that when war or conflict arises typically you see stockpiling and you see trade routes being shut down and you see energy prices climb and so i you know i think generally we're in a little bit of a transitionary state everyone knows where the puck needs to be everyone's headed there but for now i think everyone's trying to navigate how do we get through the next couple of years and in this particular year you know get through the season of uncertainty you know how fast is the economy growing how much have we actually under invested in infrastructure and how much renewables do we have coming online now i think the right answer if i were to be president of the world i would immediately deregulate uh nuclear um and make nuclear fission reactors a mainstay of energy production here in the u.s and i think that there are a number of techniques we could undertake for a safer building without all the regulatory cycles and process needed to get these things stood up you know china as i've mentioned in the past is over the next 30 years committed to building check this number out i think we talked about this 140 nuclear power stations their estimated cost i believe is on the 3 billion per station range they are going to increase their total energy production capacity with these nuclear power stations um on the order of 15 to 20 percent so they will take coal offline as they bring those online or they will kind of start to have a cleaner mix of energy rather than building a next-gen infrastructure so um you know if we as the united states intend to be an economic challenge to china this century if we intend to compete effectively with them we are going to have a really hard time with energy prices being what they are here in this country china is already 30 to 40 cheaper than us on an industrial scale basis with their current energy infrastructure and when their nuclear comes online over the next decade their prices are going to drop even further nuclear should be in the four to five cent per kilowatt hour range today china's in the kind of you know uh seven to eight cent per kilowatt hour range the us for industrial i think is in kind of a 9 10 range 8 to 10 cent depending on where you look so you know they're already cheaper they're gonna get even cheaper and so not just from like what's the right transition from a security point of view but energy is going to be so critical in this next century for us to maintain our footing as a competitor to china particularly as think about this for a second if automation is the future of manufacturing then electricity and energy ends up being the biggest cost driver for those systems and if our if everything is on parity and everyone's got the same automation systems whoever's got the cheaper energy wins and to dovetail you and champs both positions a friend of ours said hey you know nobody wants to live near nuclear power plants and they've already got the grid going there because it has to be there surround the nuclear power plant with a solar farm because it's the most efficient way so actually pairing these two things perhaps even with some batteries solves the entire problem and what do we think sax is the eventuality here in terms of the relationship between russia and china now that we've wrapped up the energy and then you know or all of us i think don't want to go to war here um so i guess there's two questions here of escalation and i'll i'll let you pick which one you want to go for escalation with taiwan or does uh if putin is not held if we don't hold the line here you know putin picks another country to uh or another region to go after in 2023 2024 at what point do you say we got to hold the line well i mean i think the line is we have existing nato treaty obligations to protect the members of nato under article five we have to come to their defense ukraine is not one georgia is not one so to me that's the line or is our existing treaty obligations and this is why we should not want to add some of these countries to nato is because it involves us in their disputes and drags us into war you know on twitter all i hear is that this is 1938 all over again and we cannot appease a dictator and that is one lesson of history it's an important lesson however there are other lessons of history and it seems to me that the situation we're in could be more like 1914 which is world war one what happened in world war one basically conflicts between minor powers dragged major powers into wars and basically germany gave uh austria the so-called blank check war guarantee and then that led to a war with russia and then that dragged the uh you know britain and france and eventually the united states so you know it was a case where nobody none of these powers wanted to be in a war with each other and yet somehow inertia and threats and escalations and miscalculations and folly all sort of tumbled their way into it and that i think may be the historical precedent here that we want to avoid i think we need to be very careful not to let you know every conflict all over the world drag us into these these types of wars and disputes sex do you think um american primacy is coming to an end i hope not but if if our goal is to preserve american primacy which i think it should be then we need to be smart about how we use our strength and we don't want to fritter it away and what have been doing for the last 20 years frittering away our strength in wars we didn't need to be in in the middle east we spent how many trillions on nation building there that turned out to be a total folly and waste of money uh look at this and we have a 30 trillion dollar national debt if we want this century to be an american century like the last one we need to preserve our strength and use it wisely and not involve ourselves in every conflict and um you know so look we need to protect our nato allies i agree with that but we don't need to be creating disputes and involving ourselves in wars that we have no obligation to get involved in we need energy independence and then we need to deliver our balance sheet in order for american prime minister and it's possible but it's going to require a lot of focus and sacrifice i really think this thing that i just made up that is actually really quite genius which is redirect that three trillion dollar build that better build to just pure solar everywhere in the united states it would be so disruptive i mean it would just be so disruptive for everybody it becomes a dividend it's like it's ubi in a way everybody gets no electrical bill i i don't think it would allow people to have free electricity forever but i do think it would subsidize basically the deployment of energy infrastructure to every single household in america in a way that would just completely shake up uh frankly the political world order because you know what you guys said is so true a lot of this stuff rests on you know the politics around natural resources right so you know today it's oil um tomorrow it's going to be some rare earth you know in 10 years it could be copper and lithium and we want to find ourselves with the ability to be clear tied and focused in our response to these issues but if we need critical resources that can only come from one other place or two other places and we don't have the engineering ingenuity to have figured out how to you know de-lever our reliance then we're going to get dragged into not just this conflict but a whole bunch of other conflicts going forward i'd say yes and we could be energy independent for free right now if we were just to repeal some of these executive orders i mean we were energy independent like a year or two ago until we banned fracking why why do the fracking when solar is available it seems to me like we want to actually preserve the environment stop global warming so if solar is available and nuclear is available why would you advocate for fracking and ripping up the earth and you know polluting it i'm a fan of solar it's really just about costs and time to deployment got it okay so you see it as a bridge hey maybe we do it for five years ten years long term i think solar is the answer but i think that's a long-term strategy the other thing that is confounding is like americans and this is another thing i was just watching the media and i did exactly what you did david as i put on fox i was like let me get their interpretation of this because the trump folks are praising putin and then these guys are wanting to go to war so it feels like there's some inner conflict or civil war going on in the republican side of things but even on the there is yeah and then on the left you have this craziness uh they were i mean wolf blitzer and everybody was so excited about this war they were like stay tuned and oh my god we're gonna be 24 hour coverage they were like orgasmic in in their coverage remember cnn got their got their big um yeah before with the gulf war that was it well it was that was your chance to shine i remember being a kid watching that that is the language free break essentially that was the language they were using so don lemon was saying and we have the full resources to give you blow-by-blow coverage of everything happening stick with cnn this is where we do our best work and it was literally like war porn and it was really uncomfortable to watch combined with sax and this is what i wanted well maybe free break i'll throw this one to you they kept talking about how americans were going to suffer at the pump and i just thought this is so crazy and disturbing there's 190 000 young russian men who are going to die countless ukrainian seville civilians who are going to die potentially and this thing could escalate asak said you know you you can't play games with war he could the dominoes can fall in all directions you have no idea when you light off these grenades and and we're talking about our pain at the pump very weird very weird times freeburg any thoughts america's weird it's weird well i want to if if freebird doesn't want to respond to that i want to talk about the media coverage i'll add to that i mean yeah you flip over to msnbc john bolton is on msnbc and one of the weirdest things happening in our politics now is that all the neocons who used to be members of the republican party who worked for george w bush and got us into the iraq war have now all become democrats and they're all over there they're supposedly the the conscience of the country over on cnn and msnbc and beating the drums of war it's absolutely unbelievable and one of the the um one of the tactics they use that i think we should talk about is and this goes all the way back to the vietnam war is that anybody who merely tries to let's say understand the other side or wants to de-escalate or get out of a conflict they try to portray as unpatriotic i mean this again this goes all the way back to the vietnam war where the vietnam protesters were portrayed as un-american and unpatriotic well it turns out they were right that was a mistake for us to get embroiled in vietnam and similarly the iraq war it turns out that was a gigantic mistake but in 2003 david frum who's like one of the leaders of this group wrote an article called unpatriotic conservatives in which he attacked and sort of mao mao the there were you know conservatives like pat buchanan and robert novak who were against the iraq war and he called them unpatriotic and imply that they were unamerican because and somehow in the pocket of saddam hussein because they were against us our involvement in the iraq war will they turn right they turned out to be right and yet they were demonized and called unpatriotic and where are we today those same people i'm seeing david from on twitter now impune the patriotism of people who merely want us not to escalate this not to get involved and maybe to try and understand our enemy because i mean this is one of the problems with twitterizing our foreign policy is look we can see putin as an aggressor we can see him as a thug or an authoritarian or as a dictator but nonetheless we should still try and understand our enemy and anybody who tries to promote a greater degree of understanding or diplomacy gets attacked by these people as being putin apologists tremothy you said you didn't see this coming you thought this is a very small probability i think we all felt it was a pretty small probability that russia would actually go through this you thought it was actually something actually i do freebird you did think it was going to happen there's a certainty yeah wait you there was a certainty that america would get involved because of the wag the dog scenario or that putin would do it because both putin's okay yeah but this is not like a surprise that putin did this i mean this has been a long time coming yeah i mean it just felt like i i i thought that he would save a rattle and we come to some resolution here but what does he want it seems like nobody and and this is what everybody keeps saying i think that's really by the way i think that's a really complicated question i i feel like there's decades of and layers of like um to the story it's like you know war and peace and then you read like one half of the final chapter and you're like oh yeah okay like there's a lot to the story that's going to be really hard for us to unpack um so you know i'm not sure there's a very simple like what does putin want as much as there is a significant narrative that that backs the history you know post-soviet history with ukraine and the relationships i mean you guys may remember that there was a president a presidential candidate or president that was poisoned by putin at some point i mean there's been like a long history to this that i don't think is something that we can reunification is what most people would put that under is this there's economic there are social you know there are individuals cultural um motives i mean there's a lot driving this there's a lot of influence within that country that i don't think we really fully grasp within the country of russia i mean that we don't fully grasp related to some of the uh cultural relationships with some of the population in the ukraine and so you know it's a very difficult question to simply answer can i take a shot at it yeah sure okay what does putin want so i want to there's an article by peter uh bainard who was an editor of the new republic he's not you know some far-right conservative or whatever he published this uh quotes from a memo that was written by bill burns back in 2008 so bill burns is the current dci he's the director of central intelligence the head of the cia he is also a russian expert he speaks russian fluently he is the he and he spent uh many years over there in our government and he works for biden he's biden's head of the cia so he is the highest ranking russian expert in our government in 2008 he wrote a memo to condoleezza rice who was then the secretary of state and what he said is this is about ukrainian entry to nato he said ukrainian entry into nato is the brightest of all red lines for the russian elite not just putin he says in more than two and a half years of conversations with key russian players from knuckle draggers and the dark recesses of the kremlin to putin's sharpest liberal critics i have yet to find anyone who views ukraine and nato as anything other than a direct challenge to russian interests so burns pointed out to the then secretary of state that this was a huge red line and since then since 2008 putin has been very consistent that ukrainian entry into nato has been a red line and even in the speech that he gave last week he talked about uh he talked about this and he said that i'm quoting putin from his speech he says if ukraine was to join nato it would serve as a direct threat to the security of russia so you know in response to putin's speech and on twitter i keep hearing that putin is this madman we can't understand what he wants that the only possible explanation for his behavior is either senility he's gone crazy he's gone mad and you know i'm looking at this and i'm like okay maybe those things are true but you can't say that he hasn't been clear about what his red lines are he's been saying this for 20 years that ukraine joining the nato alliance is an absolute red line and you know i mentioned before on this pod that imagine if the cold war was still going on and the warsaw pact still existed and you know justin trudeau was going to lead canada into the warsaw pact we would absolutely be up in arms about that we would not let that happen it is that kind of issue for putin and we just act like this guy is insane and has no point of view i'm not we don't have to believe he's right but to basically say that his he has no interest uh in russian security that we need to give any weight to that we just need to dismiss all of his concerns out of hand it just you know this is not the history of the situation yeah did you read anybody read madeleine albright's um new york times piece it was pretty interesting because she was uh in the position when they first met him and he's been talking about the ukraine and reunification for 20 years and uh it's probably a good lesson for the entire planet uh that dictators are gonna you know they they have a certain to your point your mouth of like having will and capabilities a lot of people have capabilities a lot of people don't have will to start wars anymore on this planet and and he clearly is in that group i think as hard as it is but jason we don't know here's the thing by not taking nato off the table as an issue we don't know whether his true aim here is the restoration of the russian empire or merely to avoid you know this border country being part of a military alliance that he views as a threat so i don't know what the answer is part or door number three he wants more attention he wants to be more globally relevant right but we made the mistake of not taking this issue off the table and so if we had taken the issue off the table then we could get to the real heart of the issue maybe it would have defused the situation or the eu and nato had done it right it's not just us in this like the people in europe have a big say here as we're discussing this on on a thursday february 24th uh biden has announced a coalition of partners eu australia others are doing uh pretty uh significant sanctions it seems limiting uh russia's ability to do business in dollars euros and yen imposing major sanctions on the russian banks trying to the ruble blocking four major russian banks freezing all of their assets in america adding sanctions to russian elites i guess that's the oligarch class and russia's largest state-owned enterprises will no longer be able to raise money from a coalition of governments biden assumes this will degrade their military advancement and i have a funny russian story to tell so um right when i was when i was still running when i was managing uh not just my money but other people's money and i was raising funds uh eventually you know you uh you get uh lp commitments um from all kinds of people interested in investing with you if you're generating great returns right meaning you know rich family offices all around the world want to give you capital and there's a very strict process in america where when you get capital in um you have to make sure that those folks basically pass uh uh you know an anti-money laundering check and a know your customer kind of check kyc checks and one of these checks is actually a a gray list in a black list that treasury and the doj kind of manage um and every now and then they'll put people on and off the list and there's a very famous person in russia who i will not say when i was raising money for my last fund this was probably in 2014 or 15. he was on the um he was not on the list you know very well-known person and i thought wow this is a great opportunity to get somebody who seems to be doing a lot of really interesting good work and not less than two or three weeks after we had signed our lp agreement uh i think it was doj or treasury put him on this list and we get a we get a you know an email basically saying hey tear up the lpa and uh you can't take the capital and we had to undo the entire uh limited partner agreement um crazy yeah what percentage of the fund would that person have been ballpark i i don't remember but he was he's a significant person investing in a significant 5 10 or something so i would guess yeah hey jason i just want to going back on a point i made about energy and energy independence sure um earlier because i actually pulled up the numbers so you know the average cost per kilowatt hour uh in the uh in china right now it's about nine cents uh for um for energy production it is estimated uh that um nuclear power production should drop to about four cents but could be as low as one cent per kilowatt hour if operated at scale with perfect efficiency just to give everyone a sense of where um not just security risk and kind of you know the green opportunity lies but also where economic advantage lies uh in investing in nuclear infrastructure and so as china builds out 140 nuclear plants here over the next two to three decades they're going to see their energy costs decline from about nine cents for industrial use potentially you know into the sub five cent per kilowatt hour range which makes them tremendously competitive uh on a manufacturing point of view it's a lot of bitcoin servers there's a lot of hash i think it's never going to happen um i'm not i love that nuclear i think america america's america's ability to scale nuclear i think is a very difficult proposition and i think our real solution is civil it's solar it's practical it can be done today and it can be done right now and just to look at the eu versus the us in terms of gas mileage uh which is just stunning the eu has mandated america doesn't have the resolve it's like it's like we have to we have to cross so many bridges and you know we have to really confront a bunch of issues that we um that have been riddled with so much inaccuracy you know for example like the environmental impact the understanding of how nuclear energy works you know the nimby is in jason that you refer to about not being able to build these things all around the country and so reducing the form factor in my opinion is a technical challenge that i think we can overcome but it still leaves the policy and the societal level challenges that i think are very difficult to overcome because you're talking about rewriting history in many ways and and convincing you know hundreds of millions of people that things that they had thought were true were no longer true and i think that's much much harder than we give it credit for and cars is a perfect example americans now were averaging 24 miles to the gallon the eu is mandated uh 57 miles per gallon in 2021 they're getting it done in the eu they're twice as effective i tweeted hey listen americans we we need to buy better gas mileage cars and move to evs and i was faced with quite a backlash i mean it was insane that's not entirely true because california did pass their own legislation yes and then there was this issue because the car companies pushed back and said you know it's too expensive for us to build two different excuse one for california and one for the rest of america they're already building ones for the eu just to give you one counterpoint to your statement about energy independence arising potentially from solar to generate a gigawatt of capacity an industrial scale solar farm would take about 7 500 acres you know so that's about 30. i don't think that's how it's i don't think that's how it's done i i think a very simple solar installation in everybody's home with a simple battery is more than enough to basically give people the power they need and then these big cni installations that's happening on top of all these big buildings will cover the rest and i think that you'll still have some amount of nat gas peakers usage um and maybe you can have some amount of solar or hydro or wind but people are experimenting and figuring out the battery storage capability to supplement this i think what we don't have is that at three percent residue solar we don't have a credible alternative but at you know eighty percent resi solar um with battery systems in everybody's home which is a tractable solution that cost thousands of dollars per home which the government could subsidize would be a great use of capital i think would be transformational for energy it would completely rewrite the energy calculus so so again to do that today would cost because when you do something on a residential roof it costs a lot more than doing it on an industrial scale so when you build out a 7 500 acre solar facility you get economies of scale you get single tubes everything can run off one wire when you build it on a roof you need contractors to come in you got to wire the home you got to put batteries in so the actual amortized cost over the lifetime of that solar installation works out to something on the order of 15 cents a kilowatt hour whereas if you do it on an industrial scale it works out to about 3 cents a kilowatt hour so you know your point makes sense but it it it makes things more expensive so then the question is who's going to fund the delta and is someone actually going to pay for that delta yeah we're gonna we're gonna i'm sure i'm sure over the next few years we're gonna spend trillions and trillions of dollars on nothing those trillions and trillions of dollars could probably whatever your gap is i don't know whether your math is right or wrong but whatever the gap is that gets us to china as an example in terms of the cost per kilowatt hour the government could substance and there is a quantifiable number and if we had if we decided whether it was worth it or not we could decide but all i'm saying is it's something that we need to put on the table because every time a new president comes into town and gets elected they generally get this one big shot on goal you know the last few presidents have tried to either you know cut taxes or basically give these massive um economic stimulus packages and the net dollar effect of these things is now measured in the trillions of dollars and i suspect that the net you know cost of subsidizing enough solar energy that you could have broadly deployed is also in the trillions of dollars and we should just decide whether that is in the better use of our model all right just to do some quick math here um to uh booster tremolo's point he almost nailed it exactly there are 85 million standalone homes in the u.s java i'm just going to assume none of them for the sake of this argument have solar on them but three percent do i think um average cost of putting solar on homes 20 to 35 000. i picked the number 30 000. yes yes hold on a second but but in australia it costs 5000. okay they have a cheaper system or something no it's because of all the nonsense that exists in the united states yeah so but just to give the raw cost here if it was thirty thousand dollars to put on you know you can do it you can do it for five thousand dollars for home because australia which is one-sixth the size of america is able to do it with no subsidies direct to the consumer for five thousand dollars in installation so that price is possible i'm going to pick the 30 000 crazy price in america 2.5 trillion dollars to put solar on every home the end like we're you know we're 30 yeah trillion dollars in debt 10 of our debt would make us energy independent forever the the plan gets better when you do math sorry and think of you think of the amount of savings you do to the environment think of the lack i don't know if you saw this but there was a u.n report about the criticality and importance of emerging wildfire threats to our ecosystem and our ecology i don't you know for all of us that lived in california do you guys remember how the sky was orange and red two years ago crazy pictures from los angeles so if you if you have a have less of a reliance on these aging utilities and these utilities infrastructure there'll be less forest fires the air will be cleaner um people will be more resilient think of the times that for example in texas where there was a massive freeze right where people were shut out of they couldn't have power because the actual traditional utilities were shut down if it's only two and a half trillion dollars i think we should have done this yesterday i can't believe the number is that low actually considering the things that when we put two and a half trillion dollar price tags on things then the cost of upgrading i'm just pulling some numbers here off of the internet but um replacing uh our electrical grid would be five trillion so if you think about the replacement cost of the electric grid which we're going to have to do at some point and the upgrade cost of 500 billion a year or the maintenance of 500 billion a year this actually starts to seem very reasonable and achievable if we had the will which means we need to have some politicians who actually aren't in the pocket of bills the number of jobs that biden would create if he actually ran with this then and because you do need a lot of local installation capability and other jobs you would create hundreds of thousands maybe even millions of jobs in the united states they would be really well paying um and you would be pushing us towards a completely energy independent clean energy you know uh zero carbon futures that'd be transformation yeah i wonder how many hours of work it is to install you could actually do that math as well and figure out how many jobs you create and then how much tax those people pay and then how much they spend of that money to put back into the economy you're probably getting a 30 40 rebate on that 2.5 trillion dollar so it becomes even better because of the high paying jobs all right the markets are tanking uh obviously over the last couple of months dow is down 11 percent year to date and of course a lot of the growth socks we've talked about this over and over again from zoom to netflix facebook spotify coinbase twilio all down over fifty percent uh today the market went down five six percent on the news and then rebounded is this all priced in and is this the bottom of the market kathy wood is supposedly um buying and i don't know if it's net buying or she's just reallocating but uh are we now in the bargain hunting period of the market and and we've bottomed out the smart folks that i talk to who i really you know uh look up to and respect think that the bottom in the smp is around 3 800 and that what we still need to do is it's one last flush and that last flush will really touch the big cap um companies but that growth is largely um done sort of getting taken to the woodshed so in general i think that so generally buyers are broke now um sellers of value and waiting for this one last you know 400 point move down the s p and i think people think it's roughly the bottom now if there's a world war obviously who knows all that's wrong but um yeah so sax what's more shocking that we're almost at the bottom or there's people in the markets that chamoth really which is well speaking speaking of people that we respect so i think uh brad gerson has a really interesting take on this which is that sorry i i should also be clear that i'm recruiting this one person who i really respect he knows who he is so they're poachable got it so uh brad gerson has published a couple of charts showing basically multiples in the internet index and among sas companies over the last whatever dozen years or so and what you can see is that over the last two years during covid there was a huge spike in multiples for internet companies and for sas companies and that over the last really since november last three four months has now come down and as of i would say last week it was right at about the historical trend and now it's starting to go under the historical trends so from a bargain hunting standpoint you'd have to say that this is the first time that we've been below the the average um for a few years now that's not to say it can't go down even more because in the same way that you can be above trend you can also be below trend and if this war escalates and metastasizes it will go down more but if this conflict can stay localized um and the economy doesn't go into a recession because of everything that's happened then yes this might be bargain hunting here's the chart for everybody to take a look at from january 20 to january 22 the two years of the pandemic and i think this is times forward-looking sales if i'm if i'm reading it correct i don't have the full chart here i just have a screenshot of it a portion of it yeah i think it's enterprise yeah it's enterprise value divided by like forward-looking revenue which is you've got to say it's like a r yeah it's sort of like ar it's like recording revenue um and so yeah we had this 15x we went up to 40 50x private market deals going at 100 200x those days are over big time uh and uh it's we've talked about that ad nauseam one of the interesting things that i'm seeing is i think people are looking at businesses that have been corrected and uh saying hey what is the true value of this and the i think the best example is peloton new cfo the cfo netflix i gotta go all right i gotta go jacob i love you guys love you tomorrow and stay safe and enjoy your vacation cheers now so i just without chabot here just wanna talk a little bit have you guys watched what happened with peloton and the cfo coming in and just really revitalizing that business very quickly by the way jason i'll say one thing i think um two weeks ago uh if you pulled the market they would probably have or if you looked at the the trading prices of bonds you probably would have assumed a 95 chance of a half point rate hike in march and as of today my guess is that the probability of that is below 5 and you're probably assuming you know um a quarter point rate hike or maybe even a deferral at this point and i think that's one of the things that's keeping the market up instead of tanking so much uh people are predicting that it's been such bad news that they'll push it out yeah they're assuming that under the conditions of great uncertainty like this the fed cannot act as aggressively as they were planning to act interesting and as a result that that rate hike um would be pushed out and it would continue to kind of keep prices uh somewhat inflated and continue to support the market with cheaper uh capital and liquidity so you know a lot of uh capital around the world is going to get locked up as armed conflict kind of comes to bear and when that happens you know markets will tighten up and prices will be affected and so the fed in in traditional in typical times would want to have an incentive or would have a motivation to uh you know inject liquidity into the markets um and so this is not a great time to do a half point rate hike and so it's almost certain at this point that they're not going to do a half point rate hike it feels to me like huge setup right now people have capitulated the market's gotten demolished i just think there's some these companies are still great like they're still great some great businesses out there and some great companies to invest in some great stocks to buy all the way from technology through to industrials uh through to um you know even some of the energy companies that are going to benefit greatly from this commodity cycle were were kind of in the middle of um and so there's going to be you know um i think an opportunity to move away from uh speculative um behavior into real kind of cherry picking productive cash generating um businesses in the next um uh you know or or even growth businesses that are actual um you know value craters uh so versus being like 10-year speculative kind of bet so this is a great time to kind of be looking for businesses you really like to own uh to identify them to make investments and to hold those investments for a very long period of time uh you know you're not going to find a lot of market conditions like this i mean if we all went back to march of 2020 and you remember the s p was like 2300. yeah i was going to buy disney i never got around to it yeah so like if at that point you pick businesses that you knew were going to be durable businesses and that you loved and you thought were going to have legs to them you bought everything from alphabet to disney to lockheed martin you know you could have done um tremendously well so now's a great time to kind of be looking for businesses that you really like and to buy a stake in them yeah forget forget about trying to time the bottom that's a fool's errand right no no if you want to buy stuff you want to hold for 10 years things are relatively cheap relative to a time horizon like saks pointed out and um and gerda gerstner pointed out so things are relatively cheap find businesses you like to own and buy them cheap they could get cheaper but they're kind of at the bottom you know the whole i think the whole time frame around like speculative stuff is kind of wiped out like i think that that that that era is gone now what are you saying well it's it's that plus i think one of the things that happened is that people are realizing now that the burst of activity especially like in e-commerce type companies that happened during the pandemic that was not ongoing sustainable growth it was one-time growth in fact in many cases it was sort of worse than one time growth which is it was pull forward growth meaning that growth in the future will be lower because you pulled forward all of that revenue well i think peloton might be a good example i mean yes everyone bought them during the pandemic but then after the pandemic everyone who needs one has got one already so it could also be cars right like people were desperate to buy cars and now there's not available right so what what happened is not only have multiples gone down but these companies were being comped based on growth rates that were unsustainable and so now they're all revising their forecasts down so it's the double whammy and brad's made this point but what's interesting right now is the markets are actually rallying and um i think it might be because of this latest biden news at this press conference so the important point here is that biden did not sanction putin directly there was talk about sanctioning him personally or and he also did not remove russia from the swift uh system which like sort of the key banking system and i don't know if this is because biden doesn't want to do it or because europe won't support the move pretty clear europe doesn't want to do it so no one is willing to suffer too much economic loss here to defend ukraine never mind sending troops so it seems to me that the signal here is that um both militarily and in terms of economic interest europe does not want further escalation and that may be why the market is rallying also the fed may hold off on interest rate increases while this is all going on so you know sometimes markets can act in funny ways well they're forward-looking people are putting money at stake so they have skin in the game so it's you know the the people can talk all they want about um what's going to happen with the markets but unless they're placing bets that's kind of cheap talk and here people are actually placing bets on socks they think will do well in the future skin of the game people look their economic interests are skin of the game having people's sons and daughters go off to fight and die in some foreign war that is real skin in the game what is not skin to the game is people tweeting you know their moral outrage and condemnation and whipping things up and you know we should not be listening to them calling everyone who disagrees with them traitors because that's happening too you know this is a time for cooler heads to prevail all right you and i are going to actually agree on this uh and we're both going to agree that trump and pompeo should not be fawning over putin uh yeah but you've never commented on that people want to hear well i mean you can't support them fawning over putin like that you do you i can't imagine you look i i heard i heard what what trump said when he was saying i didn't hear the pompeo quote so i can't speak to that it's just saying is a genius look listen you know sometimes trump is being sarcastic when he says things like oh what a beauty you know um he means the opposite and i think the point trump was making wasn't really about putin being so great the point i heard trump making was that if he were president this wouldn't be happening now you can disagree with that it may be true or untrue but that was the real point he was making i think that you're letting you know the political partisans try to whip this thing up and it's part again it's part of this meme of anybody who doesn't support what i want must be a traitor it must be in the pocket of true putin we have to use this meme warfare to get people free berg to shame these politicians into backing like the solar plan and doing something meaningful like this like and backing nuclear how do we get the politicians to reflect energy independence as a priority it feels like it's not a priority for them well i mean the one one of the good things about american democracy is that politicians are generally pretty responsive to what their constituents want and believe so they use polling data and that polling data drives you know if they want to get reelected they better do what the polls are telling them people want them to do and so ultimately if you can kind of influence people broadly in the united states uh and that can that can go both ways by the way we have special interests too and you have people with weird ideas right like yeah but generally like if something is deeply unpopular a politician risks not getting reelected they're not gonna kind of run to do that and if something is very popular even though it may not be the right thing by some objective framework uh you know they would still run to do that so you know i do think that there's you know some degree of uh of work to be done around you know framing for people broadly you know via the work maybe that we do on our podcast but i think more importantly on a repeated way and in a way that's kind of inspiring and inclusive will drive people to kind of want to see these changes happen and ultimately politicians should respond can i make one other point to you to your thing about um you know who who today would be considered you know in the words of gempasaki parroting russian talking points barack obama if obama today were out there saying exactly what he told the the atlantic magazine back in i think it was 2012 or 14 if he was saying that today he'd be accused of being in putin's pocket and being a putin apologist and a traitor and all this kind of stuff because he said that in that interview he said listen putin was always very businesslike he was punctual he showed up he wanted to negotiate and deal basically he sounded like a guy who look we may disagree with him about everything but he wasn't a madman he was someone you could a rational actor he was a coldly ruthless but rational actor and that's basically what obama said he's someone you could talk turkey with and if you say that today that hey maybe we could negotiate our way out of this with putin you're accused of being you know uh a puppet of his yeah the concept of starting a war uh in this day and age is just it's crazy like it is crazy that he's starting this war and putting all these people at risk and we don't even know what the goal is you guys he's not even asked for anything like what is he exactly asking for so he may not be he may have been rational then or maybe obama was trying to steer him towards rationality and praising him publicly to get that more rational putin to show up this feels like irrational that we don't know what his goal is like the fact that the world can't say if we gave him x he would do y is i think his strategy putin's always like to be this like unpredictable madman right no i mean we just said that he's a coldly ruthless rational actor that's sort of the opposite of a madman i mean his red lines have been clear he's been stating them for for years um that the problem is that again we're conducting i'm referring him to murdering opponents of his and oh there's no question that he's ruthless he's an authoritarian call him a dictator if you want i've tweeted in support of alexey navalny yeah so i get it but that doesn't mean he's a madman he has desires and interests and it's the job of diplomats to figure out how to conduct diplomacy and negotiation with people you disagree with and one of the problems we have today is again we've twitterized everything so you know we basically figure out the first step is who are the people who should be canceled you know who's wearing the white hat who's wearing the black hat let's all rise up and virtue signal and moral denunciation and you know stick our fingers in our ears and not listen to the other side and um and listen that that is a way to find yourself in greater conflicts not avoid them yeah all right so just wrapping up here let's uh let's wrap with sax's favorite part of the show sax's favorite moment where he's super engaged in learning he's got his thinking cap on he's taking notes and that is the science corner no not what about vendetta corner i thought you're gonna say vendetta corner yeah i don't want to hear that recorder this is the other quarter is actually my favorite part of the show it is now people love indeed a corner in the twitter community spaces who you horse twitter loves it because twitter is all about vendettas but i have no vendettas this week what are you doing with your time yeah i'm trying to advocate that this is time for cooler heads prevail and so um oh for sake start a fight with somebody aren't you fighting with paul graham there's nobody here you're you and jake are you guys taking the week off for ski week i don't think we're fighting over anything it's not i can't not that i can think of all right for the dictator trump paulie hapatia sultan of science david friedberg and the rain man himself david sacks i'm jay cal and we'll see you all at the all in summit in may 15 16 17. you can go to the website summit.all in podcast.com where you just type all in summit the all-in summit into google and find it may 15th to 17th in miami florida we're doing it at the new world symphony and we have a page there where you can vote on speakers it's gonna be three days of fun we have a scholarship there if you can't afford the regular ticket and uh you can apply for a scholarship if you're a super fan and we'll look forward to seeing you there and go vote for some speakers bye bye love you [Music] source it to the besties and they've just gone crazy 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