00:00:00
Nick these guys are low energy today you notice that you know what we need to do
00:00:03
we need to gamble let's do it Nick let's play a hand of blackjack let's get these
00:00:07
guys amped gentlemen what an absolute pleasure to walk amongst some goddamn greats uh let me see if I can put a bit
00:00:13
of pip in your step with a onetime black jackan to kickart one of the greatest podcasts on Earth it is I can confirm
00:00:20
this is not AI my you did this we're gonna rock and roll proper tonight let's go all right get some is this guy you on
00:00:28
right now you are going you I'm actually breaking my own rules for you guys I filmed
00:00:34
today's hand day foing but I'm going to film tomorrow's hand for you guys right now um it'll roll out this will roll
00:00:43
hold on hold on wait a minute Tim you are and kiwi living in Calgary is that right yes sir correct yep kiwi living in
00:00:50
Calgary been here since September 2022 the misss and I oh fantastic welcome welcome to my
00:00:58
country I know how I I stumbled across you somewhere and I started watching all your videos on Instagram they were off
00:01:05
the hook man congrats they're awesome thank you so much fun where where in New Zealand are you from uh from tanaki so
00:01:12
West Coast North Ireland certainly not somewhere uh it's not a holiday destination for certain if you're going
00:01:17
it's like Dairy farming country it's it's it's beautiful but it's off the beaten path so yeah and how did you how
00:01:22
did you choose Calgary of all places in Canada do you know what the Miss we holiday here uh my fiance and I may 2022
00:01:29
too and we thought it was just going to be a holiday then back to the farm um but I guess we had that uh Co Cabin
00:01:36
Fever like the rest of the world and loved our time a so much that we just decided before we even finished the uh
00:01:42
the holiday that we cracked on to to getting our visas and got back sold up me livestock and leased the farm back to
00:01:47
me parents and and made the move and uh we haven't looked back I I don't think they'll be seeing me uh pulling tits on
00:01:53
the dairy farm anytime soon I'll that's Cal foring by the way um yeah so Lads uh
00:01:59
what do we want to do here we want to put 10K and then give it to uh one of uh Tim's mates who's who's stuck or
00:02:05
something how do we do this we Mr Beast this we give 10K to the next time you get coffee if we win you give it to the
00:02:11
Barista or something what should we do yeah let's do it let's do it let's do a 10K free roll for Tim and his fans okay
00:02:17
perfect so now do you want me to add that to my bet for this one yes absolutely we want to be in 10k sweat
00:02:24
with you one and done is absolutely the uh the way to go about this here we go first part we've got to do here is pick
00:02:31
out are these real dealers or are these AI these definitely are real dealers they certainly Eastern European as far
00:02:38
as I know I don't know what their quality of life is like I imagine they're warehoused somewhere uh and put
00:02:43
on the tools now I had a I went with a with a young Lassie today and she roll Bing ass for me so I'm going back to the
00:02:48
B Because they' been good to me yeah pick a BL pick a somebody who feels Blue Collar who wants to work for us we need
00:02:55
somebody who's a worker and you have over a million followers now watching this yeah it's G from 15,000 to 1.3
00:03:03
million in this entire Journey so yeah a little bit nonsensical but okay this this looks like a good he looks like a
00:03:09
worker what you say he gonna work for us are you gonna you're gonna cop the insult live as I do it uh all righty it
00:03:16
is day 15 uh going to Blackjack committing 13 I've got we have a $14,000 bit going on the laan for me personally
00:03:23
but I actually have some absolute Legends with me today I'm bidding for the besties from the Orland podcast as
00:03:29
well they're going to bring the luck having been rolled bold and AR by a young Lassie yesterday so
00:03:35
$34,000 goes on the line oh no you guys want 10,000 on right not 20 geez I better
00:03:41
not not take put us down for 10 put us down for 10 24,000 is going on the line alela looks like the kind of bloke who
00:03:49
stops at red lights playing GTA we won't hold that again real n if you will I need to see good cards
00:03:56
Jack 2 do baby go oh my God that that worker B I knew he would do it for us I can't believe we've just
00:04:20
pulled that off oh my god did that did that happen gentlemen that has really just happened you've just turned 10 into
00:04:28
25 holy sh holy cow oh my God look at s is like we can doing this for the whole taping that's
00:04:39
amazing ready for another round we turn 20 10 to 25 all right so are we going to
00:04:44
have a separate All In Balance we just keep rolling it every week yeah can you come back next week and can we rolling
00:04:51
we just keep rolling every week we might have to that is I cannot believe we've just Blackjack there is
00:05:00
unbelievable well Tim have a good day all right Tim you are a legend Everybody follow Tim on Instagram let's get him to
00:05:07
10 million let's get I mean you have a future in broadcasting you are going to make millions you you went from The
00:05:15
Farmhouse oh yeah literally and here we go now you're gonna be running a casino I think you should have Tim's Blackjack
00:05:22
you should have your own Brandon build a whole brand on this on Insta tell I would have to run anything if I can
00:05:31
just play oneand of blackjack with you guys and I land Jack Ace every week that is unbelievable and like we said that
00:05:37
15K we won yep that's yours for you and the misses go on vacation no no no no we
00:05:43
said it we said it we want you to do something go with it we're already cashed up you take that 15K you take the
00:05:50
misses out you get some first class tickets you meet your M Italy and then let's go that's it how about I go first
00:05:57
class to the orand summit now that we could play some oh we could have a s we may or may not have a have a fun
00:06:05
casino night there so this will be fun yeah you got to come all in Summit for sure yeah get the misses take the 15K
00:06:11
two first class tickets get yourself set up in a nice hotel and we will see you there all right everybody let's get to
00:06:18
the docket well done Tim thank you Tim see you later I appreciate it I can't believe they have live
00:06:25
dealers standing in a warehouse in front of a webcam I don't that that is such a
00:06:30
like imagine walking into that facility you're surprised that facility only has what dealers it's like a lots there I
00:06:38
think you can choose at the door of what you want to do D blackj yeah or whatever else you want to
00:06:44
whatever else you want to be on a web probably making a porno in the next room above the table and below the table
00:06:52
there's two different tapings occuring oh oh my God smell warehous oh man well it's rough rough so awesome
00:07:02
so what happened you dm' him that was so good yeah we he you know what no what happened was somebody emailed me and
00:07:07
they're like hey that's my mate that you talked about he's a big fan of the show
00:07:11
it turns out you know this is the thing about influencers now this is the thing about this micro celebrity stuff we all
00:07:18
we all know each other by default right so he was just slid into the there's definitely camaraderie yeah that was
00:07:26
awesome that's awesome I'm so glad he won and uh you know he he basically got smashed in his DMs like a thousand
00:07:32
people dm'd him oh you're on Allin they're bugging out to you on Allin and uh so yeah I just said hey would you do
00:07:38
a hand would you do your live hand with us and then I didn't I didn't I wanted to clear with you guys before I put our
00:07:43
money on it or whatever but I couldn't do that because I wanted to surprise you here we are I did not think that was
00:07:48
real when he popped up I thought it was like a record thing yeah all I could think of was do I look like an ass by
00:07:53
saying more so that I just stayed quiet we more than I was like you start with 50k let's just
00:08:02
see what happens I know you ever feel like when you like tiptoe into the bet with like a small amount but you you
00:08:08
want to do more and then you win and and you feel like you actually lost money because if you made a bigger bet you
00:08:13
would have made more I lost 60k I should have put I no I would I would have put 50 I would have won 75
00:08:23
instead we put 10 we won 15 I lost 60 we made a jake house size back yeah yeah there a feel
00:08:32
that let your winners ride Rainman David and instead we open source it to the fans and they've just gone crazy
00:08:44
with [Music] it I don't know what's going on anything going on in your life anybody uh been
00:08:53
busy having some Adventure sacks seems like you were busy last week any anything to report from your side of the
00:09:00
world well should we take you take you guys behind the scenes of of a presidential fundraiser I admit I've
00:09:05
never done one before so it was uh it was a new experience for me when you host a president it's just a whole
00:09:10
different level of preparation the Secret Service was out like a week before the president has an amazing
00:09:16
Advanced team they work out every detail they make a map of your house they really have to think through everything
00:09:21
the police shut down the street it's really a very involved process by the way I went to dinner
00:09:29
in the city that night and you know I was right by your house so I drove up the street and they had everything
00:09:36
blocked off on like three blocks on both streets like on both sides of your house
00:09:40
but there were all these protesters like all throughout San Francisco like prot Trump people had driven in from all over
00:09:47
NorCal must have been because these were not San Francisco natives supporters yeah and they came in with these like
00:09:52
cars and the streets were blocked it was a total zoo in the city for hours before
00:09:58
and after your I actually stayed in the city that night and I heard the people going nuts for hours afterwards but it
00:10:05
definitely like took over it took over the city yeah so really interesting is that all week the San Francisco
00:10:10
Publications had been trying to Jin up protesters by writing about that you know the president's coming to town and
00:10:15
the protesters are going to show up and in fact there was almost no anti-trump protesters and then a huge number of
00:10:23
prot trump demonstrators came out and they were waving flags and cheering along his motorcade as he was coming to
00:10:29
to the house so the whole protest thing backfired why do you think anti-trump protesters did not show
00:10:37
up what happened I think there's just a big enthusiasm Gap I mean I think that the prot Trump people are very
00:10:43
enthusiastic and the let's call Pro Biden or anti-trump people are just not very motivated right now so it's
00:10:50
exhausting to be against Trump for eight years like this has been exhausting think they've exhausted folks uhhuh so
00:10:58
anyway who's the founder of intercom he was there and I I think this was actually a
00:11:04
good summary because he said that he spoke with a bunch of people and none of them identify as Republican all voted or
00:11:10
donated Democrat in the past that's true for me too now they're backing this guy
00:11:15
for his policies on war immigration crypto and more this elections referend on those issues so Owen you know came
00:11:21
out appreciate his support but it's true the campaign told us that they had more
00:11:26
firsttime donors at this event than they've seen before and that's because a lot of these people hadn't supported
00:11:33
Republicans or hadn't supported Trump and they came out so we have a few photos and videos here to take you
00:11:37
behind the scenes I think might be super people so the first thing to say is that
00:11:42
President Trump is extremely Charming he connects with people in like 5 seconds I
00:11:46
mean he meets you and and finds something interesting and or funny to say and he's hilarious I mean when he
00:11:55
spoke in the the living room and he talked extemporaneously for an hour he's speaking off the cuff every speech he
00:12:03
gives is different this is him coming into the living room he had made just a few notes about topics he wanted to talk
00:12:10
about on a piece of paper but that was it it was all completely extemporaneous no teleprompter obviously and he's
00:12:17
hilarious I mean people don't realize how entertaining he is what what were some of the greatest hits what did he
00:12:23
hit on did he hit on low pressure from showers did he what did he what because I know he's got like some things he hits
00:12:30
on that are relatable was it all like specific crypto topics Tech topics or did he go off he did you know he did
00:12:37
talk crypto and it was really interesting at one point in his speech he called on the winlos brothers who
00:12:44
were there and I'm only mentioning this because it was already reported that they were there so I don't want to speak
00:12:49
out of school but he said to them he says I know you guys created Facebook you know he was giving them credit for
00:12:56
creating Facebook and said created yeah but he says but but it's okay I mean you
00:13:01
guys look like models you were dealt a lot of cards you know a lot of cards you I mean they're very good-looking
00:13:08
huge IQ and I mean look at him great hair yeah and so I thought okay wow like he must know the wink ofos Brothers he
00:13:15
must have met them previously and I found out this is the first time that he had ever met them so think about the
00:13:21
awareness that he has to know that they're in the audience to see them Point them out and then have this kind
00:13:26
of hilarious routine with them so he's someone who's very sharp very on the ball very funny and then his energy
00:13:33
level is incredible so he had started his day at Mar Lago at 3:30 a.m. Pacific Time 6:30 a.m. his time then he flew to
00:13:42
Arizona did a trump rally in Arizona then he flew to San Francisco for our event he spent four hours at our event
00:13:50
he could have left an hour earlier if he wanted to then he flew to La for more events the next day there so think about
00:13:57
his day and his energy level was just amazing the whole time shath your thoughts before this goes on for an hour
00:14:05
yeah I'll give you two observations the first is that I think that there is a huge
00:14:14
gap between how the media tries to portray Donald Trump and what he's like when you meet
00:14:24
him in person and that Gap is really wide and so I would say specifically to Democrats and
00:14:33
independents you really do need to sit in the room and feel what it's like he David David is right he is charismatic
00:14:42
he's intellectually sharp and he's funny and when you put that together he can engage an audience for a long time and
00:14:49
be totally extemporaneous the other thing I would say that is that he is very polite and he's kind in a way that
00:14:56
was disarming and was not what I expected and so I felt that I had misjudged him many years in the past and
00:15:06
so I was very glad that I had an opportunity to sit beside him and to actually interact with him one
00:15:15
onone it was really really engaging and so that's that's more about the style and then about the substance
00:15:24
what I would say is it was not just a pro-america agenda but it was it's very clear that he was
00:15:31
Pro Innovation so he was really supportive of AI in the details that he talked about he was very supportive of
00:15:38
crypto in those details and he's very much low regulation low Taxation and so when you put that together it does stand
00:15:48
very much in contrast with what the alternative is um and so I think that um both of those things are a reason why
00:15:56
even if you aren't willing to vote for him I would encourage everybody to experience
00:16:05
what it's like to hear him freeberg your thoughts on uh all this I didn't go to this I didn't go to
00:16:12
the event I don't know no I just big picture wonder I want to know why why chamat didn't wear a tie everyone else
00:16:19
is wearing a tie you didn't want the tie chamat doesn't need a tie he's a baller all right you want to say what
00:16:25
what Trump said to you when he met Natalie so it's us talking any he says you guys are a really beautiful couple
00:16:32
uhoh and and I said well thank you and then he turns to me and he goes well you must be really rich
00:16:42
he and I started laughing out loud Nat thought he was hilarious so oh because of the disparity and the looks between
00:16:49
you and Nat is what sort of implying you guys sat next to him at dinner yeah yeah
00:16:54
and was that like an hour just private conversation between the three of you this is the thing that he does he
00:17:00
actually sits there and he says you know folks I'm happy to continue to talk about whatever you want me to you feel
00:17:05
free to ask me questions or feel free to just go around the room and just tell me
00:17:09
what you think and what would happen is people would say different things and then he would start asking questions of
00:17:14
other people and the thing becomes almost like this Roundtable discussion of topics from we talked about Iran we
00:17:20
talked about foreign policy we talked about deficit crypto regulation everything what he say
00:17:27
about what did he say about deficit in debt well he's very much he's very much on your side of we have to really figure
00:17:37
out how to get spending in order and get the deficit under control well congrats
00:17:42
on it sounds like a successful event for you guys sounds like you guys are in the
00:17:46
halls of power now and Trump has flipped his positions on EVS abortion and taking
00:17:51
away a woman's right to choose he's flipped his position on Tik Tok and flipped his position on crypto I give
00:17:57
him a ton of credit four flips in a month and he just sweeps all those votes it's pretty smart um and for the
00:18:05
Democrats who are listening he's also Pro you're losers and you're not listening to people so you're going to
00:18:11
lose the election and he's Biden's going to get demolished nobody wants to vote for somebody who they
00:18:17
think J you think Biden's getting demolished right that's your thought I mean did you see the video that came out
00:18:23
this week where he was at some event and he looks it looked like a a mitch mcconell moment right where he kind of
00:18:29
Frozen he was likeu so I don't want to make it like elder abuse and I know like not elder abuse to to S to say to to be
00:18:38
honest about what you're observing especially when it comes to I'm most role in America yeah he's got to he's
00:18:44
got to bow out 538 just put out their election forecast showing 51% chance of Biden winning 48% chance of trump
00:18:53
winning as of two minutes ago yeah who knows I think it's all going to be determined by the
00:18:59
saxs you were going to say well I just think what other job in America could Biden even be qualified for like what
00:19:05
what would you hire him to do is there any is there any mental job you would hire him to do is there any physical job
00:19:11
you would hire him to do would you hire him to be your babysitter I mean I don't
00:19:14
think there's any job in America that anybody would hire him to do except for maybe president it's kind of kind of
00:19:20
crazy and this is where like the Democratic parties in shambles we should have the highest standards for the
00:19:26
mental acuity sharpness and energy level of our president it's the most demanding
00:19:31
job in we need a cognitive test but the Democrats need to just look deeply in the mirror and say hey you're Fielding a
00:19:36
candidate that nobody's going to vote for that's the problem here and there's not enough anti-trump sentiment and
00:19:43
Trump's a genius that flipping his position to to get huge swats of Voters and so you're going to get demolished if
00:19:49
you don't hot swap them I guarantee you hot swap is coming I predicted the Trump
00:19:54
TV flip and I predict it now I think I think you're right about maybe some of the issues where folks will get much
00:20:01
more precise on these issues but I I actually think what's happening is that this is really going to be about Trump
00:20:08
versus KLA Harris I don't think Biden is going to step down at all but I do think
00:20:12
there's a chance a non-trivial chance that Biden wins and if he does I don't think he's going to make it four years
00:20:20
and so then the real question is do folks want Kamala and have they had a chance to really figure out whether they
00:20:27
want to vote for her I think that's really where it's going to come down to it's it's really Trump versus KLA Harris
00:20:33
and if you if you frame it as that chamath then it's even a bigger trouncing right like if you put Biden if
00:20:39
you put kamla against Trump then what would the it would be a even bigger shellacking yeah in your mind I just
00:20:48
think that without saying anything bad kamla because I don't know much about her is really what I would says I don't
00:20:53
know much about her and so you can't have somebody who gets into that role accidentally I think there we have to
00:21:03
give both president Trump and President Biden a lot of credit which is they stood in the eye of the hurricane and
00:21:11
withstood all the pressure and won and he who wins that way deserves to be the president of the United
00:21:20
States she hasn't withstood that and so I think that it's pretty unfair for a lot of Voters if there is a bait and
00:21:32
switch and so I think that you have to look at both of these two candidates and assign a reasonable probability that
00:21:41
both of them make it to the finish line and from at least what I saw up close I think it's a much higher probability
00:21:47
that Donald Trump does than President Biden does and listen Biden hasn't made it to the finish line of his first term
00:21:52
it's obvious to everybody who's in cognitive decline you put up a candidate who's in cognitive decline you're going
00:21:57
to lose even against you know Trump who people really don't like these are the two most
00:22:03
unpopular candidates of our lifetime I'm not sure about that I don't think it's true that people don't like Trump I
00:22:08
think that he's got a core but yeah no people the Republicans including the Republicans including yourself we
00:22:15
looking for a different candidate just months ago you said Trump was not your preferred candidate and you are all in
00:22:20
on to santis so let's not pretend like he was your preferred candidate he's the remaining candidate so
00:22:26
you're I think it's wrong to say that there's not enthusiasm and love for Trump we saw it on the streets we saw it
00:22:31
in that room there's some yeah do you see Logan Paul meeting with Trump four years ago he was for Biden now he's for
00:22:38
Trump have you ever seen Trump walk into a UFC event they go nuts for him I'm just saying there a lot of there's a lot
00:22:43
of enthusiasm and a lot of love out there for Trump a lot of excitement I don't see any of that for Biden there
00:22:49
are people who don't like Trump and that drives some support for Biden but if you
00:22:53
look at enthusiasm and excitement it's all on the Trump side in this we are in total agree ment yes there is no
00:23:00
enthusiasm to put somebody in cognitive decline in the White House all right listen we got to get to the docket we
00:23:06
could talk for hours about Biden Biden Biden Trump Trump trump and we will it's going to be a continuing topic but let's
00:23:13
get to a very full docket here breaking news last night Tesla shareholders have backed their guy yes there was a two
00:23:23
important votes measures that Tesla just had taken with their shareholders the first was approving elon's pay package
00:23:33
the $56 billion pay package that was voided by a Delaware judge we talked about that on episode 164 back in
00:23:40
February and then moving Teslas incorporation from Delaware to Texas this is also major remember we talked
00:23:47
last week about the Texas Stock Exchange here's the two charts massive overwhelming support
00:23:54
there were some notable people who dissented I think Norway's sovereign wealth fund and cpers were two of the
00:24:00
ones who were voting against it Tesla share price popped 6% on the news you don't want to lose Elon a Tesla that
00:24:08
would be really bad so your thoughts chamath on this vote and maybe the move and what that
00:24:16
represents it's kind of odd that we're in this crazy Place same more when that original package was unveiled
00:24:28
there was a lot of people including me who thought there's no way he's going to hit this it's just way too aggressive
00:24:37
and it requires so many things to go right and so I think in part that's why three4 of the Tesla shareholders
00:24:47
approved it then 73% is not squeaking over the line it's not 50% plus a vote it's it's a super majority and that
00:24:57
excluded Kimbell and Elon sh ex so and then I think you had this very dangerous form of judicial
00:25:05
activism which essentially ignored the will of the shareholders and tried to create some
00:25:14
administrative ruling that threw up this big question mark So then in in typical
00:25:21
Elon style he's like great we're just going to get them to voted again and then yet again it passes and it looks
00:25:26
like it's going to pass by around 73% but the problem now is that it's still not clear what happens I think that
00:25:32
there's still some question marks where this may not nullify the judge's decision it may actually create more
00:25:42
question marks so hopefully this gets sorted out he should get this stock he never should have or these options he
00:25:48
never should have had them taken away and so I just hope this thing yeah it becomes a nothing Burger saaks you
00:25:55
have thoughts on this outcome is it surprising to not surprising and then I I think the jurisdiction thing is bigger
00:26:02
than maybe people are thinking because Delaware has been the standard for incorporating companies but Elon is
00:26:11
putting his companies in Nevada and Texas we saw the stock exchange uh last week getting back to move to Texas this
00:26:18
does seem like there's something about jurisdiction in the water what are your thoughts Sachs well I think it's ironic
00:26:25
that the winning margin 73% is the same margin by which shareholders approved his comp package back in 2018 so again
00:26:34
they got 73% voted for this 2018 now they voted to reapproved by the same margin and the reason why they had to do
00:26:42
it is because this activist judge in Delaware avoided it on the grounds that somehow the original shareholder vote
00:26:48
wasn't valid and I think this is interesting that the margin didn't changed because it shows that
00:26:54
shareholders aren't in grates Elon delivered what he promised and now shareholders are upholding their end of
00:27:01
the bargain and certainly they didn't have to take that position there were different groups like calers who
00:27:07
basically took the position what have you done for me lately you know yeah you delivered but we don't have to pay you
00:27:12
because of the judge so we're not going to pay you and I think shareholders wisely approved the package because I
00:27:18
think there was some chance that if they reneged that Elon could leave the company and I still think he's
00:27:23
absolutely vital to all the Innovation that's going to come in the future from Tesla and you see this the stock is
00:27:30
ripping on the news is up about 3% today in a down market so clearly the market thinks that securing elon's future at
00:27:40
the company was the right decision and shareholders did the right thing yeah in ter in terms of the the downstream
00:27:46
effect on this like you said it raises the Spectre of Delaware being an activist State that's not why anyone
00:27:55
incorporates in Delaware the reason why you incorporate in Delaware is because you think it makes you subject to an
00:28:01
extremely predictable body of corporate law that's been tested and become bullet
00:28:06
proof over many many decades and now all of a sudden you have to worry that maybe
00:28:12
a judge will set aside a shareholder vote for reasons that seem incredibly specious especially in light of the fact
00:28:20
that the shareholders just reapproved it so obviously the shareholders did didn't
00:28:24
think they needed your protection and they voted to reverse you and moreover Tesla could still be subject to paying
00:28:32
the legal fees of these trial lawyers who've asked for literally billions of dollars in legal fees that the judge Sol
00:28:39
to rule on so imagine this imagine that the shareholder vote gets set aside by the judge it then gets reapproved by
00:28:46
sholders but the trial lawyers who brought this nuisance suit can now get billions of dollars if that happens I
00:28:53
mean Delaware can kind of Kiss its status as the premier corporate law state way freedberg is this a John G
00:29:01
Moment is this where capitalism socialism and the state Collide and people now start thinking H maybe we
00:29:10
need to create a new jurisdiction a new framework that's a good question I think
00:29:16
it's a good example for capitalism and I think it should Shine the Light on how other CEOs are getting
00:29:22
compensated at public companies where there's typically a multi-million dollar or multi- deam million doll pay package
00:29:30
that has no dependency on the performance of the business you can make tens of millions of dollars a year and
00:29:35
not drive shareholder value and I think that the way that this deal was structured where Elon effectively got
00:29:43
10% of the company for 10 Xing the stock should be an example that other boards should actively consider when
00:29:53
considering both candidates and their appetite for this sort of a package and their compensation packages themselves
00:30:01
the way executive comp typically works at the board level at public companies is you hire these comp consultants and
00:30:07
the comp Consultants come in and they use comparables which basically means let's do what everyone else does and so
00:30:13
you have this self-reinforcing system of compensation and benefits for CEOs that
00:30:19
bumps up a little bit every year that ultimately has not has some degree of ownership in the stock but fundamentally
00:30:25
has very little downside and Elon had no guarantees in his pay package when he got this comp package originally in 2018
00:30:34
and he got 10% of the company if he 10x the stock which is what he did I really think that it is worth having this
00:30:43
become the kind of Beacon for all boards to consider and it seems like shareholders in aggregate are applauding
00:30:50
the concept and look Elon is a special guy and he gets special treatment but I think that it moves the needle and
00:30:56
should move the needle a little bit for other CEOs and other boards to stand up and say we should think about something
00:31:02
that looks a lot more like this than what we typically do and I think you would find a very different cast of
00:31:08
people showing up to become CEOs and to drive performance out of these businesses and a lot more risky and
00:31:13
aggressive behavior than what I think you would typically see in big companies that are in maintenance mode what do you
00:31:19
guys think of the organizations that initially voted yes and now voted no they basically are saying look I mean if
00:31:27
you think about it you're big public company I don't know what iss recommended this is institutional
00:31:30
shareholder Services they they recommended no both times right and so ISS basically is what a lot of big
00:31:37
public fund managers will follow when they make their votes and so if I'm a shareholder that's not what I'm no no I
00:31:44
know what I'm saying but like let's say let's say that I'm black rock or I'm a share a big I'm not goingon to put Black
00:31:47
Rock as some big shareholder of Tesla stock why would I vote to give away 10% of the company when I don't have to yeah
00:31:56
very simple because he would leave morals and ethics matter and you want to do the right thing and you want to
00:32:04
incentivize capitalism to operate properly and want to incentivize the people who take on the burden of running
00:32:09
these companies and the people who voted against it I think people should just make a list of those individuals Cham
00:32:16
and they should not do business with them because if somebody is going to double cross you they've shown you who
00:32:21
they are these are people who double cross them they got the benefit and then they stabbed them in the back make a
00:32:27
list exactly what they did that's exactly what they did it's worse if they voted yes the first time and
00:32:31
then they voted no no I'm saying and then maybe you're just against the deal but if you're yes no then that's a
00:32:39
a reneg then you're a true scumbag you're a scumbag is that public anywhere who did that yeah there are a bunch of
00:32:45
folks that said that they you know I think it was cpers that voted yes and then when they were on trying to explain
00:32:50
they were like tap dancing in like corpor jargon but really what they are scumbags Jason you're right they are
00:32:57
morally and eth void and they're reneging and this is the one rule in business you're not allowed to do and
00:33:02
the people that do that are these penny pinching scumbags I'm not saying a black
00:33:07
list but I would say making a list of people who maybe you want to consider not doing business with is how I would
00:33:12
frame it these are but they're public they're Public Market investors they're not private investors they buy the stock
00:33:17
on the open market so they don't have to worry I mean I think the question is what are the chances that Elon leaves
00:33:21
the company if he didn't get the pay package the chances prob risk and I think Poss think about it yeah non zero
00:33:29
possibility you made an agreement with somebody and you shook their hand yeah why does care whether he would
00:33:35
have le left or not left this is like you have to do the right thing yeah you have to do the right thing you promised
00:33:40
the guy x amount of money for doing y amount of things he did the why things and then you had a judge come over the
00:33:47
top because of somebody who owned 10 shares and all I'm saying is if you if you don't have the intellectual
00:33:53
intelligence to look past that and say wait a minute we just paid the guy to do this work and now we're going to reeg
00:33:59
they're gaming the system I just think that like how can anyone who is capable of doing a job sign up for a pay package
00:34:07
how could anyone and the people that will sign up are these like middling corpo people who will accomplish nothing
00:34:15
and will run these companies in ways that then speaks to organizations that have just proven themselves to be
00:34:22
totally unreliable the irony of the thing is that these folks thought that they were getting a 10% free roll when
00:34:29
they voted no and the reality is that by him getting the pay package the certainty of him sticking round at the
00:34:36
company caused the stock to go up by 10% so they actually had the calculus wrong
00:34:41
that if they had gotten their way the stock would have declined by more than the 10% free roll they thought they were
00:34:46
getting this is I think the the main point and 10% being the ownership of the company that he gets yeah the pay
00:34:52
package was laughed at on CNBC by all the experts there's no way for him to hit this stuff
00:34:58
if he does hit it he's getting a fraction of the value of it and this is why stock is such a valuable device if
00:35:04
employees get stock and the CEO gets stock and everybody in between and Retail investors get it and endowments
00:35:10
get it and your retirement account gets it everybody rows in the right direction
00:35:14
is it perfect no people can buy back their stock they can do a little gaming on the margins but it is the most pure
00:35:20
system we have everybody has a share of the company so if you're a socialist you
00:35:25
know like you should actually kind of appreciate how stock works that everybody has a
00:35:30
chance to buy everybody has a chance to participate this is the model we should be using for all CEOs they should all
00:35:37
get a massive package if the stock goes up and to the right it's so obvious and this was so unfair let's see this
00:35:44
flipper I want to see their explanation the compensation is commensurate with the performance of the
00:35:49
company did you vote for it in 2018 I believe we did vote for it in 2018 but this is about long-term value
00:35:57
but do you believe you were duped in 2018 no I believe we used the information we had available and made
00:36:03
the best choice okay so here's what I find so interesting about this particular choice 73% I believe of the shareholders
00:36:11
voted in favor of in 2018 a judge has said that shareholders were not informed properly if you talk to most
00:36:18
shareholders by the way especially big shareholders they say we were not dup we we understood completely what we were
00:36:22
doing and we were on board with this now that this opportun almost opportunity has arrived on your doorstep uh to say
00:36:30
to actually rethink this if you will there's a view that oh maybe maybe we're not getting the value uh we we
00:36:37
thought we should MH you thought you should get it but he's worked by the way under the assumption that he was hitting
00:36:45
the numbers right and and dealing with the contract mhm if I told you that you were being paid a certain amount of
00:36:52
money in 2018 and then I called you and said actually you know what we're not going to give you that money anymore
00:36:57
what would you do it's a great question I would um I would go to my board you know I would talk with my
00:37:05
board this woman is so smug what is her name Karen Frost I don't think she's smug sorry marshy Frost oh sorry I
00:37:12
thought it was Karen Frost I think that this is emblematic of the kind of person
00:37:17
who is incapable of actually doing the right thing and there's a lot of these people that run a lot of these
00:37:23
organizations that I mean what what kind of an answer is that I mean it was a non
00:37:28
answer that's why I said it was smug let me just ask each of you you've all started companies some of you are still
00:37:34
running companies would you take money from her and cpers after that statement hard no for me yeah but remember she's
00:37:41
not investing in private companies she's buying stock on the open market so announc yeah cper announced that they're
00:37:48
an LP and they're starting to do directs oh okay I didn't know that yeah they're
00:37:52
trying to catch up they've been behind on Venture let's call this whole thing what it is it was a heist you had these
00:38:00
trial lawyers they find a name plan if who's got nine shares and on a contingency fee basis they go after
00:38:07
elon's pay package what are they looking for $5.6 billion how does a lawyer make $5
00:38:14
billion how that's what motivated this whole thing they don't care about Tesla they don't care about the company they
00:38:20
don't care about shareholders they're looking for a giant multi-billion dollar contingency fee payment and they took
00:38:27
their shot and they found a Delaware judge to basically agree with them even though shareholders approved it and then
00:38:34
shareholders reapproved it so my question is how much are these trial lawyers going to get is a judge going to
00:38:39
award them billions of dollars for what was clearly now a mistake to avoid a pay
00:38:45
package that shareholders wanted to stick with if they award these lawyers billions of dollars which is what
00:38:51
they're seeking no one's going to want to do business in Delaware anymore because it subjects you to these stickup
00:38:57
up Heist by trial lawyers so I think that's going to be the next big shooter drop is what do
00:39:04
these trial lawyers get awarded well what are they going to get paid because they also wanted to get paid in Tesla
00:39:09
shares no I'm serious here's an idea buy the shares yourself yeah they said we don't like your management of the
00:39:15
company but uh we want your shares yeah yeah by the way they got their shares and then they voted to give Elon the
00:39:22
next pay package so it's just a full-on grift they they secure the bag but supposed to protect corporations against
00:39:29
this grift that's why people incorporate there when people ask why does Delaware
00:39:33
have the special place that everybody decided Delaware would incorporate it was because it was predictable lawyers
00:39:40
felt this was the most predictable jurisdiction that would be the most shareholder friendly most shareholder
00:39:47
thoughtful whatever word you want to use they would defend the the the shareholders and here we are the last
00:39:53
company I started 8090 we incorporated in Nevada and I just redomicile a couple of other companies that I own into
00:40:01
Nevada as well it's becoming a trend we're having very big discussions about this in the startup community of where
00:40:07
to domicile your company and more to come on this one okay let's keep moving Apple had a huge
00:40:13
announcement this week Apple has entered the chat they announced Apple intelligence get it Ai and they have
00:40:20
included a chat GPT integration from open AI this was really I think imp impressive in many ways because people
00:40:29
thought Apple was far behind it was a banger of a demo a lot of unapp like futur looking demos so none of these
00:40:36
demos that we're going to show are coming to your phone this week they were really I think playing catchup with
00:40:43
Microsoft and it worked stock is up 10% uh they added about 300 billion in market cap now the top three market cap
00:40:50
companies are all driven specifically by the perception that AI is going to be the next technological wave Microsoft
00:40:59
Apple and Nvidia all cruising around about $3.2 trillion and the this top three keeps uh
00:41:07
flipping back and forth Apple had past Microsoft and market cap here's the features I'll just give you a quick
00:41:14
overview of what we're seeing it's added uh grammarly like features great product
00:41:19
grammarly I'm not an investor but they added the ability to proof get grammar help AI will transcribe and summarize
00:41:25
phone calls with permission obvious double opt in it will prioritize notifications and iMessage and email
00:41:31
that are super important you can do smart replies uh and Company where an investor in superhuman or he does this
00:41:36
kind of stuff and they're bringing AI to Siri and this is going to be the big win
00:41:43
in my mind you're going to be able to say things like you want to order something in door Dash or Uber Eats or
00:41:50
instacart and it's the AI Siri will be able to dip down into Apps they're building a whole app AI interface much
00:41:57
like the rabbit device CEO talked about doing and uh I think this means that apple is going to win the AI consumer
00:42:04
there is a deal with chat GPT that I'll get your feedback on gentlemen in a moment according to sources apple is not
00:42:10
paying open AI it's a non-exclusive deal chat GPT can be swapped out apple is also talking to Google about a similar
00:42:18
deal obviously it doesn't take a genius to predict that apple is going to auction off the llm integration I think
00:42:23
to the highest bidder they did that with the search deal Google pays Apple 20 billion to be the default search engine
00:42:29
that's about 5% of Apple's annual revenue if you didn't know and it's all profit right so this is a huge uh profit
00:42:36
moment I'm going to pause there for a second before I get into more of this uh and just get your general reaction
00:42:43
shath I think you nailed it right at the beginning the thing that I was struck by
00:42:48
the most in this is we went from a phase where in the Steve Jobs era these events were because you were
00:42:58
about to unveil a product that was done and shipping as of that day and then at some point we transition to they are
00:43:10
talking about products that they intend to release within a year now we've shifted to the part where they're
00:43:17
talking about software Integrations from a third party that will happen in a year
00:43:21
so if you just look at it sequentially it's a little disappointing in that sense because for a company this
00:43:29
big it's really not much of anything you can't really touch it and feel it and it's going to take a
00:43:37
year before we really know what the totality of all of this is meanwhile the economics of the chat GPT
00:43:45
deal were leaked and there's no money on either side so I don't know it's a little bit
00:43:51
of like it's really not much of anything to be honest because there's nothing we
00:43:56
can actually play with experience freeberg your thoughts on the vision here at least and to chat's point
00:44:04
Apple used to release dope stuff fully baked ready to go and now we are increasingly see them talking about
00:44:12
what's coming next year or at some point do you think Apple's going to win the consumer do you think Apple's falling
00:44:17
behind should they have built their own llm by this point I'm not sure I think what they have shown is more of a
00:44:25
glimpse into the future of hard Ware where for the last two decades or so Hardware has mostly been a portal to
00:44:33
access the internet and use the internet through apps or through the browser and
00:44:37
Hardware has done a good job of enabling that but I think we're now going to see
00:44:41
a much more tighter coupling where the hardware becomes more valuable and it's less of this kind of
00:44:47
funnel for apps to flow through and data to flow through but the hardware actually becomes the value Creator and
00:44:52
you see a much more tighter integration in the hardware OS and the AI or the software that enables you to do lots of
00:44:59
things you're no longer just going to use the hardware to access an app to do something so a lot of the companies that
00:45:04
are app developers are likely going to end up becoming Services developers that enable that Hardware AI to do something
00:45:10
for you and this coupling between hardware and software because of the way AI works is I think becoming more
00:45:16
apparent not just in consumer devices but we see it in the data center and in the Enterprise stack as well you know
00:45:22
we've seen that obviously there's this tight integration between the chip and the software stack that grock built
00:45:28
there's a tight integration between Google's TPU stack and then the ml instances and the and the tools that you
00:45:34
can use in Google Cloud that are optimized for use on that TPU Hardware nvidia's got a big effort obviously in
00:45:41
continuing to build out their software stack that sits on top of their hardware and works in a more coupled way and then
00:45:46
Google has this ability to kind of realize I think a similar outcome with pixel phones which is a pretty sizable
00:45:53
opportunity for them and then all of the hardware manufacturers can probably grab
00:45:56
more Val now as they build their own AI into their OS and you start to see more of this value realized by the hardware
00:46:03
companies so I think that there's this really interesting shift where we've all thought about Hardware as being this
00:46:08
like commodity where there's some degree of like Improvement or innovation made over time but now it seems like a lot of
00:46:15
value might actually get captured by Hardware companies in all points in the value stack so it's an interesting
00:46:21
moment and I think that this just shines a light on that Trend that I think is going to play out over the next couple
00:46:26
of years it's clear Sachs that right now to enable these features you're going to
00:46:32
have to have a pretty solid device they announced here at the keynote at WWDC that you need to have an
00:46:39
M1 chip or better iPhone 15 or better so and having all this local data is a huge
00:46:47
Advantage for Apple they've got your messages your phone your calendar your photos your app Behavior the data inside
00:46:54
of your wallet all of this gives them a huge huge Advantage so I guess the question is do you think this renews the
00:47:02
Apple franchise and people start upgrading their phones again to get all these new features David sax well the
00:47:09
market definitely thinks so because Apple was up big on this news and even if it was largely vaporware at this
00:47:15
point the market definitely liked where they were going and frankly Apple did exactly what I said they should do last
00:47:20
week which was to reinvent Siri as an llm with the ability with the capability to reach into apps as an agent and take
00:47:28
actions on the user's behalf that's what they effectively announced however Apple
00:47:32
took a shortcut to get here they partnered with open Ai and this is something that I don't think they've
00:47:39
ever really done before at the operating system level apple is famous for being vertically integrated for being a Walled
00:47:45
Garden for being end to end they control everything from the chips to the hardware to the operating system and
00:47:52
they don't let anybody else in until you're at the App Store layer this is allowing somebody in beneath the level
00:47:59
of the App Store this is allowing someone open AI to get access to your data and to control your apps at the
00:48:05
operating system level and I think you know Elon pointed out wait a second what are the Privacy implications here and I
00:48:11
think there are major privacy implications there's simply no way that you're going to allow an AI on your
00:48:16
phone to take all these actions on your behalf without giving that model substantial amounts of user data and
00:48:24
that is a huge change for Apple remember Apple in the past has been the advocate
00:48:30
for Consumer privacy there's a whole issue of the San Bernardino terrorist where the FBI went to Apple and said we
00:48:37
want you to give us backd door access to their phone and apple refused to do it and went to court to defend user privacy
00:48:44
and furthermore one of Apple's defenses to the arguments the antitrust Arguments
00:48:49
for allowing sideloading and allowing you know other apps to get access to parts of the operating system is they've
00:48:55
always said we can't do this because it would jeopardize user privacy and user security well here they are opening
00:49:02
themselves up to open AI in a very deep and fundamental way in order to accelerate the development of these
00:49:09
features in other words they took the shortcut they could have developed the llm themselves they could have developed
00:49:14
the AI themselves but they chose not to do that and I think this is going to open Pandora's Box for Apple because
00:49:20
again they've proven that they can open up the operating system to a third party
00:49:24
now and who knows what the privacy implications of this are going to be it turns out Apple has addressed this
00:49:30
head-on they hear the concerns and much like when you share a photo or you share
00:49:35
your location it's going to ask you over and over again do you want to let this app do this so they're aware that this
00:49:41
is an issue they brought up privacy every single time but people don't trust open Ai and they do trust Apple so this
00:49:48
is strange bad fellows to be sure chath your thoughts I think that Apple really cares about privacy when they're to hurt
00:49:57
a company they don't like I.E meta and they're they're willing to figure out a way to work around it when
00:50:05
a company that they clearly support open AI yeah well when you're behind you know
00:50:10
you behave differently than when you're ahead and you have your Monopoly freeberg you wanted to add anything here
00:50:14
before we move on to the next story okay in related news open AI has hit a run rate and this is kind of stunning of
00:50:23
$3.4 billion that means they've roughly doubled their monthly Revenue in the past six months
00:50:31
or so these are not official numbers open eyes denying them but here's a chart that somebody put together based
00:50:37
on all the different leaks and approximations of what open is making the reason this makes no sense this
00:50:45
chart and it shows a year and then it shows a month a month a month a month is because there's been different leaks at
00:50:50
different points in time but just to normalize this in 2022 for all of 2022 before they really had a lot of
00:50:57
customers 28 million and now on a $3.4 billion run rate again it's pretty stunning number if you can you can do
00:51:05
apples to apples here because like 2023 Jan is 200 million that means that June is 300 million if they're on a$ 3.6
00:51:13
billion run rate so yeah and so if we were to even look at you know the number of people who work there 770 if you put
00:51:21
that at 500,000 a person some Engineers getting a couple of million some people maybe getting less they're probably only
00:51:26
a half billion dollars in salaries a year who knows what they're spending on the infrastructure for this if you were
00:51:34
to do evaluation on this everybody knows they sold a bunch of shares in secondary
00:51:39
at around 80 billion which means they're trading at if these numbers are true 25
00:51:44
times for Revenue which is close to what Nvidia is trading at right now obviously
00:51:49
they're two very different businesses so your thoughts on this as a SAS company obviously the majority of this revenue
00:51:57
is consumption based some portion of it is SAS based reoccurring like subscriptions we pay for at launch my
00:52:04
Venture fund we pay for 6,000 a year to have all 20 25 people on chat GPT as a corporate account maybe it's 250 300 a
00:52:11
year per person so what do you think of this business sacks and how fast it's growing obviously some of it's API
00:52:17
consumption based not reoccurring some of it is reoccurring first of all let me say that you know we've talked about AI
00:52:23
General Hospital and all the soap oper issues around open AI yeah and you know judge sax had opinions on that yes but
00:52:30
putting that aside I mean everyone acknowledges that their products are awesome I mean open AI makes really
00:52:36
great products uh with chat gbt 40 being at the top of the list and I talked about how when we move from chat gbt 4
00:52:44
Turbo to 40 at glue the speed and quality went up you know at least 2X and it felt like 10x so they have the best
00:52:54
language model as of this point in time and they also have other products that are really great like the whisper API
00:52:59
which does transcription I mean there's a whole bunch of tools they have that are great for developers so nobody's
00:53:06
taking anything away from them on the product side and I think you're seeing that in this Revenue number now if I was
00:53:13
to try and take apart this business as an investor I would separate the b2c business from the B2B business the BC is
00:53:21
a consumer subscription plan people paying $20 a month I I'm one of them I pay the 20 bucks a month it's probably
00:53:28
the only llm that I would pay 20 bucks a month for how often do you use it daily
00:53:34
weekly monthly it's a a handful of times it's it's not to be honest it's not like
00:53:39
a daily use for me but I I probably use it every week I would say at least once yeah so I still use it I have to say
00:53:46
though that the other llms are catching up and if J and I ever gets good enough or you know when grock gets to the next
00:53:53
level am I going to stick with that $20 month plan I'm not sure it depends whether open AI can really maintain the
00:54:01
the leadership it has or the perception of leadership okay so that's half the business and then the other part of the
00:54:07
business is the B2B which is the the API products that effectively they're selling to developers and that's where I
00:54:14
would place the future value of this company I mean as somebody who invests in SAS when we see a business that has
00:54:20
uh beta C subscriptions and beta B we place all the value on beta B and the reason is because historically the churn
00:54:27
rates in BC are too high yep 5 to 10% churn rates are common 50% a year per month per month 50% turn a year very
00:54:36
common open AI may not be experiencing that yet but it's very hard to avoid the downdraft of consumer churn and and you
00:54:46
know on the other hand on the B2B side a good B2B business has expansion 120% 150% expansion year-over-year from same
00:54:54
customers in other words they're order more so you would compare this business to Amazon web services Google Cloud
00:55:01
Azure that's really the business you're yeah the first thing I'd want to know is
00:55:05
how much of the 3.4 billion is consumer and how much of it is is developers we'll find out eventually chamath your
00:55:11
thoughts on open AI surging Revenue I'm kind of in David's Camp which is I think
00:55:15
to the extent that the business has a large terminal value it's going to be because of the
00:55:23
Enterprise cash flows the thing to keep in mind is that I still haven't seen Enterprises
00:55:32
building production level products using AI it's all experimentation right it's all experiments now yeah that's nothing
00:55:39
against open AI it's just a commentary on the fact that we are at a very very early part of the cycle where when you
00:55:48
use this term blast radius right what are you referring to you're referring to this idea that you're stringing together
00:55:56
elements of a model or multiple models that each have some non-trivial error rate and by multiplying all these error
00:56:03
rates together you get your final product but the unfortunate reality in most AI workloads is that you end up
00:56:11
with something that's not very good and that's not the fault of open AI nor is it the fault of llama it's just the
00:56:17
nature of how these bottles work and the fact that you know you've gone from something very you know deterministic to
00:56:23
something that's very probabilistic and we have not found a way to create extremely high quality experiences we as
00:56:31
an industry that make this cost justifiable so right now as you said Jason most of
00:56:37
that is toy apps and a lot of experimentation will we get there I absolutely think so but we're not there
00:56:44
yet so I suspect that most of the revenue then is on the consumer side right now
00:56:51
actually and so I just looked at Google Trends and I first looked at the United States and I just wanted to understand
00:56:56
and how is the traction and what's interesting is is that the traffic in the United States is
00:57:02
down about 25 26% since the end of the school year which I think reinforces this belief
00:57:10
that chat GPT has definitely over indexed in that young people's cohort where they rely on it to write essays or
00:57:18
what have you but then I looked outside the United States and worldwide and what's interesting about that is that's
00:57:23
actually still growing up into to the right so I think you have then an arpo problem which is the same thing that we
00:57:30
had to deal with at Facebook which is we have these extremely valuable users in America they ASM toote at some point and
00:57:36
then we have to grow in other markets but those markets aren't nearly as lucrative right the they just average
00:57:43
revenue per user rpu per year is single digits maybe it hits double digits as opposed United States where it could be
00:57:50
triple digits right so then I I don't know I would just wrap up by saying that I think that it's just if this number is
00:57:55
right it's just an incredible Testament to what they've been able to uncover and
00:58:01
create in a short amount of time that is legendary stuff yep but what I can tell
00:58:07
you in working with Enterprises around these AI experiences through 8090 we have not yet
00:58:15
seen production quality models being deployed in the wild that are dealing with very very
00:58:24
important business processes which means that most of the revenue right now is probably
00:58:30
consumer oriented okay freeberg you I don't know if you got to see Sunny's talk at liquidity last week but he
00:58:35
talked about how many of the cios CEOs are looking for open- Source Solutions here 80% of them want to go open source
00:58:43
they don't want a proprietary model uh to invest in but the best model right now is a proprietary model so what do
00:58:50
you think about open ai's Revenue surge is it sustainable or are there 20 better open source projects that are
00:58:58
going to be death by 20 open source project cuts and chat's general feeling here
00:59:04
that hey it's not ready for prime time yet it will be but we're in the AI dialup era to use an analogy here hey
00:59:11
you can see the promise but it kind of sucks in terms of reliability maybe open AI is AOL right like I think that
00:59:18
there's going to be a Google that'll show up that'll maybe it's Google that'll grab a large part of the the
00:59:23
value here or you know ultimately the cost comes down so much with the open source tools I do
00:59:32
believe that these open source tools are incredible I mean the the open source llama
00:59:36
instances are like they get you 85 to 90% of what you're looking for so if you're an Enterprise user why would you
00:59:43
pay thousands of dollars for the open AI platform when you can use llama and you
00:59:47
can tune it and you can build your own front end to it your own integration with your own data etc etc it's just
00:59:53
early days for Enterprises figuring out how to do that but I do really believe that the future is Enterprises companies
01:00:02
building their own llm driven tools for both internal and external products that
01:00:09
leverage smaller open- Source models and that we're kind kind of in this you know
01:00:15
dir of people's understanding and ability on how to actually execute against that which makes the default to
01:00:20
be go to the chat GPT interface I will also provide a counter I just did a project at work this week we had a like
01:00:27
a big offsite we had 20 people involved and everyone used chat GPT to get ready for it so there was a ton of analysis a
01:00:34
ton of data Gathering a ton of reporting needed for the offsite and rather than hire a third party or have people go out
01:00:41
and Source data themselves a lot of us including myself I I prepared like maybe a quarter of the material just used chat
01:00:48
GPT and pulled the sources to make sure it was all kind did you did you oh you did pull sources and check facts right
01:00:53
you do have to do so we pulled the and there was a lot of wrong stuff just clear but for our to ballark percentage
01:00:59
I would say 25% of it was like wrong and then you had to clarify but the truth is
01:01:03
for this particular application it didn't matter we were making some approximations on markets and sizes and
01:01:09
and various facts that we were kind of using to do some strategy stuff but and some product development stuff so I
01:01:15
would say like found it useful you found it 100% And I would say it saved us hundreds of hours hundreds of hours you
01:01:22
paying them an Enterprise license or a consumer license 20 bucks bucks a month what is that it's the same thing for the
01:01:28
Enterprise jamaath you can just sign up and for 20 bucks a month you can have your whole like did freeberg yeah no
01:01:35
freeberg like you're just paying it yourself or you pay for everybody at ohal I think everyone has the right to
01:01:40
pay for I think other people at the company pay for it too I pay like I I have my I don't have like a corporate
01:01:45
thing set up so everyone B we took the time to set up the corporate it's really easy and then anybody with your domain
01:01:50
can sign up and let you track it but it doesn't consolidate that's what I'm looking for trat is the ability to
01:01:56
consolidate all the searches in one place and everybody can share their searches but like I said the application
01:02:01
is doing right in some way Sachs yeah collaborative AI it's an application today meaning like we go to the app we
01:02:07
ask questions we get answers and we use that and I actually had it Pull tables down and I Dro those tables in like all
01:02:13
sorts of great stuff it could do you know do some analysis pull out the Stu what the analysis showed understanding
01:02:19
unit economics on various businesses all this sort of stuff that it Consolidated definitely makes everybody
01:02:25
bionic I but what it's what it doesn't do yet is take all of our internal data and all of our internal tooling and kind
01:02:32
of reconfigure how we use that so we're still paying for a whole bunch of enterprise software and SAS licenses for
01:02:39
things that we know we don't want to be paying for in the future and we're now starting to figure out how can we build
01:02:44
our own AI based software to replace a lot of the dependency we have on third party software that uses our internal
01:02:50
data for our internal consumption so there's a lot of that still ahead of us and that's why I and we're pretty
01:02:56
Progressive so that's why I know it's early Innings because I see the way we're going to use it and I know that
01:03:01
we're probably well ahead of a big Enterprise companies that are more traditional and so I can see like a
01:03:06
couple years from now all these big Enterprises are going to figure the same thing out and then you're not
01:03:11
necessarily going to need to pay for this chat GPT stuff if there's an internal tool and an internal LM that
01:03:18
you can run young people are really getting dependent on this and they use it constantly we were on our investment
01:03:24
team meeting we were valuating a company for real estate brokers we're evaluating
01:03:28
a company for therapists and like tools and SAS products for those type of people and when I asked them well how
01:03:34
many What's the total addressable Market boom three or four researchers and analysts on my team are doing that
01:03:39
search finding sources and saying there are this many therapists this many social workers this many real estate
01:03:44
brokers this many B and then I'm saying well did you source that they like yeah of course I asked and like one of them
01:03:50
was like well I asked Claude I asked Gemini I asked chat gbt I asked them all for sources I cross reference so they
01:03:56
like have three of these things open and so just everybody's knowledge level goes
01:04:00
up but you do have to check it because one out of four facts is probably wrong or cited wrong and so it's going to be I
01:04:07
think one out of four is about the right number yeah it's about one out that's interesting so you use multiple LMS to
01:04:13
find the hallucinations yeah basically you cross reference them that's actually pretty interesting I jump on Gemini too
01:04:18
so I use Gemini Google and I use chat GPT and I just make sure that stuff lines up just sanity check things
01:04:25
because I'm of these right how many would you be willing to pay for pay for five you'd pay pay for five
01:04:32
different llms well think about it if somebody's salary is a $100,000 and these cost $1,000 to have five of them
01:04:37
of course i' pay for five 1% of their Sal okay so as a work tool you know I guess there's three categories to their
01:04:43
business now that you're raising this there's sort of the consumer subscriptions y then there's the
01:04:49
business subscriptions which are basically the consumer product but a company's paying for it corre and then
01:04:53
there's the developers paying for meter yeah yeah this that that Enterprise is really powerful yeah it's kind of like
01:05:01
Microsoft Office or Google Docs where consumers use them for for free or want to use them for free and then companies
01:05:08
will pay for it and that's where the real money is anyway this is going to make people bionic I think all
01:05:14
organizations will have the same number of people for the next couple of years and then just individuals will get
01:05:19
better and better at their jobs and so efficiency is going to go way up speaking of efficiency the market is
01:05:25
ripping we're going to get a little macro here in 3A inflation has uh been broken I I think it's safe to say we're
01:05:33
are down at 3.x 3.3 lower than expected and hiring and wages are surging and stocks are surging so let's go through
01:05:43
it here and get the besti take on the vibe session I actually disagree with that framing Jason yeah I agree I
01:05:50
disagree as well disagree with it let me go through the numbers and then you can
01:05:52
all disagree that's how that's how this works folks inflation print came in at 3.3% lower than expected here's your
01:05:59
10-year chart super easy to explain what's Happening Here rates were low for a long time inflation cruising at about
01:06:04
2% and then lunatic spending during covid and we added a trillion to the national debt and then Biden added a
01:06:12
bunch everybody getting those stemy checks and PPP loans and so if you look at inflation here we were just cruising
01:06:17
along at 2% massive Spike up to 9% year-over-year inflation and now coming back down to
01:06:24
3.x and the question is can we get to a two handle and the rates went up faster than in ever in history here's the Fred
01:06:32
chart you can see there in and this goes from the 80s so you see that massive um
01:06:38
Spike when they tried to break the back of inflation previously so this is the fastest ever gone up and here we go the
01:06:46
common sentiment here is that savings has been burned off and people are starting to have debt and so now we are
01:06:51
in uh act two the lowest unemployment uh rate of our lifetime continues if you believe those numbers some people do
01:06:59
some people don't Labor Department reported 272,000 new jobs in May smashing crushing the
01:07:07
190,000 estimate uh and then act three average hourly wages up a massive 4% from last year at $35 an hour that also
01:07:18
topped estimates so if inflation is at 3.x and hourly earnings are at 4.x maybe consumers will start feeling better
01:07:25
about the economy eventually they obviously uh have been pretty shocked by that 9% inflation and only 4% growth
01:07:32
here's your chart from Fred of the hourly earnings of all employees and you can feel pretty good about that where
01:07:39
everybody's wages keep going up the question is do they go up faster than inflation okay so there's my framing of
01:07:45
the situation freeberg tell me what I got right tell me what I got wrong I think there are three numbers that
01:07:50
matter the inflation rate the growth in GDP and the cost to the growth in GDP in the first quarter
01:07:59
of 2024 was a lousy 1.3% on an annualized basis and even if the rate of inflation came down we are
01:08:09
still inflating the cost of everything by north of 3% so the economy is only growing by
01:08:16
1.3% and it costs more than 3% more each year to buy stuff so that means everyone's spending power is reducing
01:08:24
and our ability and our government's ability to tax is declining because the economy is only growing by 1.3% and the
01:08:31
most important fact is that the interest rates are still between four and 5% four
01:08:37
4.7% that means that to borrow money cost 4.7% but the businesses the economy on
01:08:44
average is only growing 1.3% so just think about that for a second we have a tremendous amount of
01:08:49
Leverage on businesses on the economy on on the the federal government that that
01:08:55
leverage the cost to pay for that debt is more than four to five four to 5% but you're only growing your Revenue by
01:09:03
1.3% so at some point you cannot make your payments and the rate and the goal that is true for consumers that is
01:09:11
true for Enterprises and it is true for the federal government just to point out
01:09:15
here what you're saying the goal was to in fact increase the interest rate to to
01:09:21
cool the economy right which they got too late but that was the goal that was the explicit goal to cool the economy
01:09:26
yeah the whole purpose of raising rates is to slow the flow of money through the
01:09:30
economy and by slowing the flow of money through the economy there is less spending which means that there is
01:09:35
you're reducing the demand relative to the supply so the cost of things should come down you should reduce the rate of
01:09:41
the increase in the cost of things now if you click on this link Nick that I just sent you in response to the
01:09:48
condition in the economy today Elizabeth Warren sent this note to Jerome pal three days ago saying dear Mr pal or
01:09:56
dear chair pal we write today to urge the Federal Reserve to cut the federal funds rate from its current two decade
01:10:02
high of 5.5% the sustained period of high interest rates is already slowing the economy and is failing to address the
01:10:10
remaining key drivers of inflation she goes on to point out the fact that consumers are suffering businesses are
01:10:17
suffering and the strain of these three numbers is really starting to show on individuals on businesses and obviously
01:10:24
on the power of the dollar both the dollar is a different story because of the condition of the the economy and the
01:10:28
rest of the world and we're in a very unique position but I think that things are not as rosy now there's a certainly
01:10:35
a shift in the market because what this tells us is that the timeline at which the FED will cut rates is coming in a
01:10:39
little bit relatively speaking and so the market is saying okay let's adjust to lower rates the 10year treasury yield
01:10:45
has come down a bit but we are still in a difficult situation for people and for
01:10:50
the uh for businesses and you have Elizabeth Warren who I think is the voice of small business and consumers
01:10:56
she's she she's trying to be the voice of those very hard on people chamath what's
01:11:04
your take on this we have a slowing uh GDP growth we have inflation going from nine down to three we
01:11:12
have wages going up 4 per. how do you make sense of all this do you feel like sorry freeberg are you saying we're
01:11:18
gonna have stagflation or we have stagflation right now definitely but I uh what I'm saying is that it's not a
01:11:26
Rosy picture just because labor rates are going up if the labor rates aren't going up you can see this ultimately the
01:11:34
best number for this is the sum of GDP growth so in aggregate if the revenue of everything combined which is GDP isn't
01:11:40
going up faster than the increase in the cost of everything people businesses and
01:11:44
the government can't afford their stuff and that's fundamentally what's going on
01:11:48
right now what we need to see is a normalization where GDP growth is greater than inflation rate and as soon
01:11:54
as that happens then we have a more normalized and stable economy so right now things are not stable there's a lot
01:12:01
of difficulty and strain in the system I will put myself on the other side of that trade if if there was one if I had
01:12:09
to simplify the United States economy remember GDP is 70% spending by individual
01:12:19
people and so people can spend two things savings that they have or credit that they
01:12:26
have and what's interesting is that we have finally burned through and this is what this picture shows all of the money
01:12:35
that folks had in their bank accounts and so what does that force people to do it actually forces people
01:12:43
to re-enter the workforce so that they can start to make money but the problem is that companies have been shrinking
01:12:52
and have been on a defensive posture and so as a result which you started to see
01:12:57
this past unemployment report unemployment is now ticking up because when these people re-enter the workforce
01:13:03
there are no jobs for them to have people are filing incremental unemployment insurance claims States
01:13:09
like California in fact the state of California was the worst off this past month so I think what we're starting to
01:13:15
see is that for the large portion of the economy we've run out of cash to spend and as a result I do think that we we
01:13:25
are going to see an economic slowing and I think that that will create not just enormous empirical
01:13:34
justification for Jerome Powell it'll be exacerbated by what freedb just showed which is the political pressure that
01:13:41
he's going to be under to cut will it cause him to cut more aggressively than he would have
01:13:47
otherwise on the margins I actually think yes but my perspective is that I think
01:13:53
that we've run out of money individual people so I think unemployment is going back up I think GDP is going to shrink
01:14:00
yeah and so I kind of tend to be in this camp that we're going to see more than one rate cut so here is total job
01:14:06
openings to your point shth they're getting burned off we peaked at 12 million again if you believe the numbers
01:14:11
or not they're they they obviously have some value and we've burned off a ton of
01:14:16
those so saaks what's your non-political nonpartisan take first principles of what's going on with the economy well
01:14:23
look we just had this inflation report CPI was 3.3% the market was expecting 3.4% so that's a teeny bit better than
01:14:30
expected but it's still persistently sticky inflation is and furthermore Pal's comments were very hawkish he
01:14:41
basically said he could not commit to when rate Cuts might begin and we're already remember at the beginning of the
01:14:48
year we entered the year with expectations for seven rate Cuts this year now we're down to an expectation of
01:14:54
one rate cut and we can't say for sure when that's going to happen so honestly I think your introduction
01:15:01
overstated how positive this news was and that's why I think if you look at the markets right now it's very mixed
01:15:08
most tech stocks that I'm seeing are actually in the red and a few of them like Tesla and apple and Nvidia are up
01:15:15
but the vast majority are in the red so I think the market is taking this in stride I think the big picture here is
01:15:21
just we don't know when Ray cuts are going to begin and I think that Vinnie lingam had a a really interesting take
01:15:26
on this actually where he he said look could pal cut by a quarter point would that matter that much no it wouldn't
01:15:33
matter that much but the point is Pal doesn't want to say that the rate height cycle is over right if he were to cut by
01:15:41
a quarter point that by itself wouldn't do much but it would be a huge statement
01:15:45
that we're out of the woods on inflation there's not going to be any more hikes coming and we're beginning a new rate
01:15:51
cut cycle and pal is clearly unwilling to say that we're still in this like limbo where he is saying that we don't
01:15:57
know when rate cuts are going to begin betting markets had two a 70% chance of two rate Cuts before pal spoke
01:16:03
afterwards now it's one rate cut Dow record high again this past week and NASDAQ record
01:16:11
highs each of the last like month for the last four months so the market putting aside individual stocks has
01:16:18
broken records almost every month for the last three free on on the back of like two stocks I mean Nvidia
01:16:25
is holding up the whole Market there's a lot of funny memes about this Nvidia Microsoft thei stocks have have are
01:16:33
holding up the whole Market correct yes record stock market what does Jerome pal
01:16:38
have to gain or lose by bowing to political pressure so a lot of folks mention and reference his kind of
01:16:45
there's political pressure for him to do something but why would he bow what does
01:16:50
he care what what do you think the motivation is for pal individually and what is the political
01:16:57
process that will ensue he doesn't bow to political pressure I think it's the Legacy and the perception that he leaves
01:17:04
behind I think had he not over promised and underd delivered at the end of last year remember he was promising as sack
01:17:11
said six or seven rate cuts and he's delivered bubus and the markets were none too pleased and so now I think he's
01:17:19
just swung the pendulum to the other side which is he's going to massively under promise and then overd deliver if
01:17:24
he can and so as a result I think he's being much more measured and guarded I don't think he wants to be wrong here so
01:17:31
I think he's thinking about what most folks think about when they're at the tail end of their of a job like this
01:17:36
he's not going to get reappointed he's going to go off into the sunset it's roughly about how history will write how
01:17:42
he handled the transition from that to the next phase whatever that is so I think he's probably very interested in
01:17:47
making sure he doesn't break the economy and also that he doesn't seem like he's
01:17:51
constantly waffling and unpredictable but isn't he just an autonomous agent that is meant to respond to the data I
01:17:56
gu I'm not quite understanding the degree of judgment and discretion that everys they have a mandate but if you're
01:18:04
asking what his incentives are I agree I think his main incentive at this point is concerned for his historical Legacy
01:18:11
and specifically he wants to be thought of like vulker not like Arthur Burns in the 70s vulker basically crushed
01:18:19
inflation even at the cost of a recession and he is worshiped today as the best Fed chair ever whereas Burns
01:18:26
let inflation slip the leash in the 1970s and he's not thought of very highly so I think that Pal's main
01:18:33
concern here is with his historical Legacy at this point I don't think he's expecting to be reappointed he's
01:18:37
wrapping up uh his second term already now I think if you go back to 2021 the incentives were a little bit different
01:18:44
pal wanted to be reappointed by Biden and remember that in the summer of 2021 that's when the inflation began we had
01:18:51
that surprise 5.1% inflation print pal was up for renomination and Confirmation in November of 2021 and I think what
01:19:00
happened back in in that year is the administration downplayed the inflation report they called it transitory Yellen
01:19:07
did Biden did and so pal had to get on board with that message if he wanted to get confirmed by the Democrats and he
01:19:13
did get on board that message he repeated the whole transitory point and for that reason they didn't begin the
01:19:18
raik cycle until March of the following year and from that may inflation print to November they kept doing QE even
01:19:26
though we had inflation back in the system so I think I think that pal was actually intensely political in 2021 he
01:19:34
knew who was going to reappoint him and who was going to have to confirm him and
01:19:38
he got on board that message and that's why they were so slow to react to the inflation and I think it was disastrous
01:19:44
and that's one of the reasons why the rate tightening cycle was so steep is because he had to catch up with all this
01:19:50
inflation that he had allowed for N9 months longer than he should have but if you ask me what's his incentive now I
01:19:55
think it's purely about Legacy and he does not want to let inflation come back after cutting rates a little too soon so
01:20:05
his incentive I think at this point is to to make sure that he's not wrong again about inflation and to remind
01:20:12
everybody maximum employment stable prices moderate long-term interest rates is the Mandate for the Federal Reserve
01:20:19
they're supposed to be independent famously rean push vulker to get R cuts and there is a lot of
01:20:27
politics involved in this and so Legacy does seem like the organizing principle here I
01:20:34
would agree with chamath and Sachs that it's Legacy but there's always political
01:20:39
pressure here as you can see Elizabeth Warren is trying to push him to make cuts for obvious reasons yeah well no
01:20:45
there there's politics when they're up for appointment or for reappointment for confirmation basically because they want
01:20:54
to get get that vote Yes but but there's also subtle pressure and then there's letter writing like Elizabeth Warren's
01:21:00
doing here right so the pressure can be there the question is do they bow to it right sex yeah they don't have to I mean
01:21:05
the fed's independent what do they stand to gain or lose by the pressure is my question and I'm not sure I really like
01:21:11
this Con exactly and I think that's really where there's a important point to note here that you can identify the
01:21:18
guy's motivation and how he's going to operate this year because there are there is no political pressure there was
01:21:23
in 2021 and I think that's why he was slow to react yeah right listen if pal can stick The Landing here then his
01:21:31
legacy comes out intact but if he screws this up and then he was slow to react to
01:21:36
the inflation back in 2021 and 2022 his legacy's going to be mud so I think he's
01:21:43
going to be more concerned about airing on the side of tamping down inflation than airing on the side of the economy
01:21:51
not doing as well I think those are the my position is I think he he might have already stuck The Landing I think like
01:21:59
the fact that we've burned off all that savings to your point shth that people are going back to work and that these
01:22:05
businesses are doing fantastic and efficient because of AI and other gains it feels like people are I think he's
01:22:14
stocks that are no no yeah they're they're trying to go back to work jobs don't exist I think they're going to take jobs
01:22:21
they just might get the job they want and that's what I think people have to recognize this they have to take a job
01:22:28
and they may not be the one that they want working from home we could have a a negative recessionary print going into
01:22:34
the election cycle I think that's very possible yeah exactly I don't know Jason look I I'm I'm hearing a lot of happy
01:22:40
talk right now and I agree with you had you had 1.3% GDP growth rate with a 6% of GDP deficit by the government if the
01:22:50
government wasn't printing so much money wasn't overspending that's right were to
01:22:54
have a balanced budget it would be a recession yeah think about that to subtract Nega it would be negative GDP
01:23:01
growth if not for the government's program stimulating the economy and a lot of the jobs you're talking about are
01:23:08
government jobs the government is creating jobs like crazy not in the private sector but in the public sector
01:23:13
because it is an election year so there's a lot of political forces proing things up and I wonder what happens
01:23:20
after the election we'll find out all right everybody this has been another amazing episode of the Allin podcast
01:23:29
Just One Last Thing guys this is really important so friend of the P Peter Fenton who's a famous VC in Silicon
01:23:35
Valley tweeted that his sister has been diagnosed with the rare saroma and they are searching for
01:23:42
lookalike cases to do a study at Dana Farber and if this works it will change the future of cancer but they are
01:23:52
seeking this um researcher William Gibson who's retweeting is seeking patients with my oxoid Lio myosarcoma
01:23:59
featuring a plag1 fusion so if you are somebody out there who has a case like this then please
01:24:09
reach out and let us know or let Peter Fenton know this could save a life or many lives his sister is also the the
01:24:18
wife of a good friend of ours Pete brigger so our thoughts are definitely with you and if there's any out there
01:24:25
who has this type of ver saroma please let us know and we can refer you to Dana Farber and this is a very important
01:24:33
study that may save some lives Pete and Peter are great guys and our thoughts with Devin and hope you guys find a cure
01:24:40
okay best wishes to Peter and his sister help out if you can and you're in our thoughts and our prayers