00:00:00
check out you have a really long nose hair thank you on your on your left this one here this side yeah yeah okay hold
00:00:06
on one side you see it Nick you see it see that you can see it take care of it every show we have this issue every show
00:00:12
he's got all this like I'm getting old man here so I feel like sex oh you gotta get a grooming tool I am tired of
00:00:18
treasure hunting a lawn mower manscape makes one I'm gonna get it yeah just look in the
00:00:24
mirror bro can you come over on the way to Parker Freeburg and help me manscape yeah you're not coming to Poker don't
00:00:30
come to Poker if I manscape can I come to poke foreign [Music] okay so jaycal you're gonna be a
00:00:51
participant today the world's greatest moderator is taking a week off to allow his voice to recoup
00:00:57
to recover to heal so he can come back blaring with his usual mid-sentence interruptions and excellent moderating
00:01:05
tactics next week we with his Foghorn Leghorn moderation we are gonna We Are Gonna Miss You at the moderation welcome
00:01:12
to the top 20. sax you're welcome welcome to the top 20 podcast in the world okay well hold on who should be
00:01:18
thinking whom I mean you've been doing this for 10 years I walk in here off the street all of a sudden we're top 20.
00:01:23
yeah let me explain something to you number one blog in the world I created it with my guys Engadget okay top five
00:01:29
magazine in the world then I do a podcast with you three idiots and all of a sudden I drop down to top 20 in this
00:01:33
medium so drop what are you talking about yeah exactly I drop this has been a b tested no I mean this week it
00:01:40
started I don't want to embarrass you but look at twist ratings compared to ours this weekend startups is about
00:01:45
startups it is a niche Audience by Design and it's the number one startup podcast in the world that's what you
00:01:50
wanted this show to be the show is about all topics every time we try to talk politics
00:01:56
you're like it's too much politic sex I think you're talking about free bird I think you're talking about Freeburg
00:02:00
let's focus on narrow legalistic technicians that's true you we had this discussion sax and I said we should
00:02:07
always do the top story of the week even if it's politics and now it's taking credit for my insight about McLaughlin
00:02:12
group I saw you on some pod who was it I absolutely designed this pod around McLaughlin
00:02:19
group everybody said McLaughlin group okay it's possible for two people to have the same idea sex we both grew up
00:02:27
on McLaughlin group that's why we're both cantankerous [ __ ] moderator intervention cut it out
00:02:32
no one is individually responsible for this podcast it was Tim Ferriss Yeah Tim Ferriss here's what happened so I was on
00:02:40
YouTube and um you know I'm not gonna watch some two-hour like podcasts with Jay Cal of course but for some reason
00:02:47
for some reason Tim Ferris 10 minutes of Jacob the video is called the origin of the all-in podcast I can't
00:02:56
stand what he does oh God here we go I can't stand what he does that yeah so I'm like okay so I gotta watch this it's
00:03:01
in the partnership agreement he said here's the the party line and jaycal will not stick with it because we're
00:03:05
going to recreate and watch this I got to see this alternative reality that Jacob's trying to create about the
00:03:10
origin of the ball excuse me I wrote I wrote in our leadership history yes and I changed no yeah the origin story that
00:03:18
you signed up to are you saying you changed the origin story Remains the Same no it doesn't you call
00:03:23
me after CNBC the origin story that he told Tim Ferriss which is like a 10-minute story of how he created the
00:03:29
whole thing the concept was his it was based on McLaughlin Group which I'm the one creation concept is mine obviously
00:03:34
by default how I moderate the program is by my design yes you didn't come up with
00:03:39
this concept especially your Chagrin of course I did no of course I designed my moderation I was the first one who said
00:03:46
we should record us having conversations at the poker table no that idea came from him right that's why it's called
00:03:53
the all in pod no I came up with the name all in number one number two was his idea to tape a pod because he came
00:03:59
out to see me anyway who cares the pod's here it's successful why do you keep going on podcasts
00:04:05
telling everyone that you're the Mastermind of the all in pod people are saying out the game other podcasters
00:04:11
I'll explain to you other podcasters are in awe of my ability to moderate you three mile contents you did not have the
00:04:18
idea for the foursome based on McLaughlin group that happened that happened spontaneously as a result of
00:04:24
the fact that no Freeburg was I think the first guest I was the second guest then we did the four of us together okay
00:04:33
it was a jam session that worked out that's okay fine the way that the way I moderate this is of note to the world's
00:04:41
greatest podcasters they want to know Jake out how do you take three misanthropic malcontents and make them
00:04:48
actually palatable to the world and I say you know what because I am the world's greatest moderator and someone
00:04:52
like Tim Ferriss wants to know excuse me excuse me what makes me a misanthropic male content exactly just your behavior
00:04:59
in world view and what does my world view your absolute contempt for Humanity no you're amazing it's a joke it's
00:05:12
called a joke it's called a joke oh now you set them off jaycal you really that that hurt you should apologize
00:05:18
it's called a joke I think you guys are wonderful I think you guys were wondering well I
00:05:23
mean I may be misanthropic but malcontent I'm not no Saxon freebing are the mountain that's for sure I'm not
00:05:28
content I'm pretty damn happy you're happy the last descriptor anybody who knows you would ascribe to Friedberg was
00:05:34
happy no I would say no I think he's happy he's anxious but he's happy yeah he's anxious but happy did you see the
00:05:41
roast that was not a happy man that was tearing you up that was funny yeah that was okay
00:05:49
yeah that was venting yeah that was rage no I think I think when Freebird tries to be funny it comes out kind of mean
00:05:57
yeah maybe that's true it's been a rage the only person that sets me off into making me unhappy is you Jay Cal I mean
00:06:04
like the four of us could go to therapy or we could keep recording this podcast every week which is cheaper I think it's
00:06:11
cheaper for us to just record the Pod you know what I for one am thankful to whoever gave you whatever sickness you
00:06:18
have that causes you to not be able to talk this week okay great you're talking a lot for a guy who can't talk cause
00:06:24
you're coming at me be nice to me while we're talking about all kinds of random stuff
00:06:30
the number two thing that I see in the what's happening tab on Twitter right now is how Ron DeSantis is getting
00:06:37
blasted for Banning AP African-American studies because he thinks it falls under
00:06:43
the stop woke act that's this the headlines it's going absolutely nuclear on Twitter right now here are some of
00:06:50
the quotes shocking Ron DeSantis has banned all caps the teaching of AP African American studies in Florida
00:06:56
Florida has gone from don't say gay to don't say black next tweet claiming it violates the stop book act and has no
00:07:03
educational value Florida Governor Ron DeSantis has banned AP African American studies from schools let me make a
00:07:09
prediction right now this will all red down to his advantage the same people who said that he was
00:07:14
death scientists for basically not instituting coveted lockdowns he was proven correct then they said that this
00:07:20
bill that prohibited the teaching of gender fluidity to five-year-olds they quite try to claim that was a don't say
00:07:27
gay Bill 70 of Florida supports that that went down to his Advantage I don't know the story behind this particular
00:07:34
course but if the question is whether CRT is going to be funded by the state and he's preventing that again I think
00:07:40
that'll be a 70 popular issue so let's just wait and see how this plays out fair enough I just want to claim that my
00:07:47
spread trade maybe it's tough to be the leader in the Republican nomination process in January of 2022. it's
00:07:55
starting yeah the front runner in either party but I'd say the bigger threat to the santis is
00:08:02
there's a new poll where Trump came out on top so Trump's still his biggest threat yeah so
00:08:09
unfortunately jaycal may be right that the Republicans may do something stupid here and a nominate a candidate who's I
00:08:17
think less electable than DeSantis I actually don't take any joy in it I actually I think Nikki Haley's going to
00:08:22
come out of nowhere and win this thing well it's possible I you know I I really would like to see some non-political
00:08:29
non-career politicians run for office the Bloomberg you know sort of category it feels like these career politicians
00:08:37
are just really really bad at executing his scumbags you know you know who likes
00:08:42
Nikki Haley who Democrats Democrats why you guys why why do we like her obviously polarizing
00:08:50
she's polarized so she's a safe establishment Republican who basically is not going to put up any Fierce
00:08:56
resistance to what the Davos crowd wants to do I don't think that's true I think
00:09:01
she was pretty she liked another Republican nomination I don't think she cares about Davos people to save her
00:09:06
life I think that she is a moderate reasonable person who had to govern in a Southern state and got everybody on
00:09:12
board that's that's pretty crazy she's a pro-life person who negotiated a 20-week
00:09:19
support for abortion in 2014. so this is a person that knows how to get stuff done South Carolina happens to be the
00:09:28
state that's actually at the Leading Edge of climate transition she's had more jobs and more money coming into a
00:09:35
southern red state of people and companies willing to build for climate change than any other state in the
00:09:40
country so you like her I don't know she's just she's so I just think that she's actually like normal and sane and
00:09:46
not an idiot would you vote for her absolutely over Biden absolutely absolutely interesting 100
00:09:53
so yeah look if you're really willing to vote for then that's interesting absolutely I would she's you know she's
00:09:59
young her parents had a small business she was a small business person it's tough to be a winner at all of
00:10:06
those levels and she managed to do it I mean how do you as a brown woman get elected to
00:10:12
governor of South Carolina and do a lot of really good stuff that's kind of tough yeah so I don't know I think she
00:10:20
deserves a close look and she's the only one that didn't kowtow to Trump she was
00:10:24
able to play the game manipulate him get him to be on her side and then still told him to go pounce in that's pretty
00:10:30
cool well a lot of a lot of Governors managed to do that I don't know what I'm saying I'm saying she got she she went
00:10:36
to the United Nations she did what she needed to do there that's an important role at that time
00:10:42
actually Nikki Haley expressly has said she will not run if Trump runs so she's kowtowed to Trump too she wanted to be
00:10:48
his VP right like she was trying to shank uh Pence right that was her plan maybe it's a smart strategy but she said
00:10:55
she will not run against Trump the main alternative to Trump in the Republican party is DeSantis and then I'd say the
00:10:59
number three in the Republican party after Trump into census Glenn young right now huh based on what metrics
00:11:05
based on interest in the party and you know I've talked to people and I think the polling will eventually reflect this
00:11:10
he's very talented Jake how you talk about appealing to Independence he was able to win a blue State remember
00:11:17
Virginia went for Biden by 10 points and Yanko was able to win that state if you
00:11:23
ever listen to any game campaign he's a very talented campaigner I think yonkin is very very talented don't get me wrong
00:11:28
and I think that he would be an extremely credible candidate for president here's the thing that yonkin
00:11:33
will get destroyed on is he's literally not been in the job for but for a few you know 18 months so he hasn't done
00:11:42
anything and I think that if it does boil down now it may not matter right because look Obama was a senator
00:11:49
for two years or whatever right so it may not matter but to the extent that Republicans demand some Bona fides I
00:11:56
think that you'll see Trump and DeSantis attack yankin more viciously in a presidential primary then they
00:12:03
attack Haley on that dimension of you have no experience and it'll be hard for him to back it up just one final point
00:12:10
you know forget the Steel Man the other side so final point we got it we got to get started final Point Virginia has
00:12:16
this wonky one-term term limit on Governors so you know he's got no choice but to make a play in 20 uh 24. because
00:12:24
he's gonna be termed out anyway okay Jay Cal has a lifelong independent who's only ever voted Democrat which of these
00:12:31
Republicans Republican to be clear so which of these candidates for Republican one time when he was 12. yeah
00:12:38
no no I voted it three times young kid three times I would like somebody who's younger and
00:12:47
actually I've been quite influenced by your framing of a person who can control the budget and reduce spending because I
00:12:54
do think it's kind of the most existential risk we have right now so I might be moving to more of a single issue uh Vote
00:13:01
for This presidential election I love that issue I love that about you I just think like we we have to have somebody
00:13:07
younger who is not going to bankrupt the company and the more these candidates talk about social issues and not
00:13:14
economic ones I think it's a tell that they're not the right person for the job that's where I'm personally at is like
00:13:21
this country has a serious Financial existential crisis on its hands and we have to get off social issues and we
00:13:29
have to get on to financial standpoint so I assume then you support the Republicans in this looming budget
00:13:36
Showdown I actually do yes I do think we should hold the line on spending so you support
00:13:42
the Republicans voting no on raising the debt ceiling yeah I actually do I think
00:13:48
we should start pumping the brakes on spending and I do think the Tea Party no that doesn't mean I like those
00:13:55
candidates they're kind of whack jobs actually but you think George Santos is a whack job listen it's the whack pack
00:14:02
the Republican party has turned into some crazy Howard Stern whack pack sax is appalled by it he just can't some
00:14:10
elements of both parties look exactly would you ever invite to Mark Santos to your house who would you invite okay
00:14:16
actually are you kidding me who would you be willing to hold a dinner it's not a
00:14:22
fundraising dinner but just invite to the house you can pick between two people oh no Alexandro ocasio-cortez or
00:14:27
George Campos who would you pick for I'd rather probably meet and talk to AOC of course because it would be
00:14:35
interesting do I want a fundraise for her no but no no I'm not asking fundraising who just let in the door
00:14:40
front door unlock the front door for me to AOC yeah what would you do to George would you not even return the email if
00:14:48
he said David I'm in town I wouldn't let him in the house for dinner don't let him know him yeah he might he might
00:14:54
steal the silverware or something it's so crazy I mean it's so nuts Listen Hold on hold
00:15:02
on hold on we gotta get started um as your moderator I'm gonna try and keep us on track good luck uh yeah no look it's
00:15:08
a it's an energetic day I appreciate I appreciate my co-hosts and their enthusiasm enough recognition for
00:15:15
supporting the Republicans in this budget Showdown I mean I'm like blown away by this I think it's great I think
00:15:21
it's great as you guys know just to restate it's my number one concern on Earth today yep and I I think that the
00:15:27
importance of this topic really needs to kind of Rise Above politics of all the things you've said Freeburg in the last
00:15:33
like six months on this program it's the one thing that stuck with me and it's one thing that has like actually now I
00:15:39
realize is the most important thing for this country is fiscal responsibility austerity measures and looking at how
00:15:45
we're spending money and looking at immigration and looking at economic velocity and employment
00:15:51
and competing on the world stage with a solid balance sheet is the balance sheet
00:15:56
is how you compete the balance sheet is how you compete I think it rises above social issues and it rises above climate
00:16:03
change cannot you you cannot address climate change or social issues or infrastructure or unemployment unless we
00:16:11
have the ability to operate as a country over the long term and have the ability
00:16:15
to have for the continuing credit of the United States dollar and that's why I think it's so important
00:16:21
free break I'm dealing this with with startups I have right now and I tell them the balance sheet is how you
00:16:26
compete if your balance sheet is flipped upside down and you're going to be out of business in nine months you're not
00:16:31
competing with these two other companies in your sector you have to have a strong
00:16:35
balance sheet take the austerity measures make the cuts and then compete with a strong balance sheet it's just so
00:16:42
obvious this country's balance sheet is getting flipped upside down and we are going to have so many yeah very complex
00:16:49
second and third order effects with the interest payments if you value austerity
00:16:54
if you value austerity if you look back in history and you actually ask of the prime ministers or presidents of various
00:17:01
countries particularly First World countries that have actually had an impact in implementing austerity you
00:17:06
know what the unifying thing that I can say is women do a much better job than men
00:17:11
okay you want austerity you're better off with with Margaret Thatcher with then with a dude
00:17:18
AKA Nikki Haley enter station it's a very hard position to be in as a politician because you have to position
00:17:28
your objective as one of taking things away and the primary way to get elected in a democracy just like in junior high
00:17:35
when you run for president of the junior high class is I'm going to make the vending machines free you get elected
00:17:40
and when you run in politics you always promise your constituents what they're gonna get that they don't have today and
00:17:45
that's the model for getting elected whatever the issue is of the day whatever the issue deserved a decade
00:17:50
whatever it's all about what I'm going to give you that you don't have today and so to flip that conversation around
00:17:55
we all have to sacrifice together for the long-term viability of our economic Prosperity we need to do we need to give
00:18:04
up the following things that is a very hard platform to run on when someone on the other side of the podium on the
00:18:09
other side of the stage is saying I'm going to give you these 10 things and it's very hard to get elected and that's
00:18:13
why democracies ultimately eat themselves and I forgot who said it but ultimately all democracies end up
00:18:19
realizing they can vote themselves all the money and then you have this big cycle
00:18:24
applicants did the most brilliant thing ever recently they moved from stop to steal to stop the spend this is a genius
00:18:32
they may stumbled into nobody wants to hear them talking about the election being stolen that's complete nonsense
00:18:38
but stop the span everybody is seeing in their own personal balance sheets they're seeing
00:18:44
it in their companies they're seeing it in their families they're seeing it with
00:18:47
their mortgage payment they're looking at their you know uh College tuition bills they're looking at their
00:18:53
car payments going from 400 to 700 and they're seeing what variable interest does we have variable interest debt this
00:19:00
stuff is going to Skyrocket whether it's elon's payments for Twitter or your payments for your mortgage or our
00:19:06
country's payments for our debt we have to stop the spend effective interest rates yes yeah but
00:19:13
guys let's just continue the conversation and talk a little bit about this world
00:19:18
economic Forum Gathering that that took place in Douglas I know you guys wanted to talk about it this week
00:19:24
intellectual honesty I'm like blown away right now because he's sick okay so look
00:19:29
um no it's because I'm not moderating when I moderate I'm always trying to get the best out of you sex the
00:19:35
as it relates also to the global economy and growth so Davos took place uh you know over
00:19:41
this past week just so everyone knows and I remember you know working at Google 2004 I
00:19:49
remember like how exciting it was for the executives to kind of start to transition into the davo stage it became
00:19:54
this moment where you're kind of finally on the world stage it's an exciting moment for CEOs for world leaders for
00:20:02
Global economists to get together talk about the state of the global economy where the world is headed what we can
00:20:08
and should be doing about it and Davos is also this this place of Pride and Prestige for being invited and being a
00:20:15
part of the party the global Elite party as some people are now calling it and that's what I think is the important
00:20:20
conversation is that the world economic Forum gathering in Davos has recently been
00:20:25
cast as this Gathering of the global Elites those who are trying to take control and run the world as they see
00:20:32
fit and sax I'd love your point of view on how that transition has happened because one of the important ways that
00:20:38
the Davos Gathering has been cast in the world economic Forum has been cast is in
00:20:43
the negative light of being globalists and globalism has had a really important role in driving global economic growth
00:20:50
and prosperity and it has had these adverse effects in the US as we've seen with wealth inequality loss of jobs
00:20:56
offshoring gutting of Industries and so on I think that there's a really important way that
00:21:02
Davos has been politicized but the risk of that is significant because if we do lean into this globalist notion and say
00:21:09
it's all about Elites trying to take control of our world and we all become isolationists that countries around the
00:21:14
world can suffer deeply from The Economic Consequences of that shift so maybe tax you can kick this off and
00:21:20
especially in light of our conversation today about the need for economic growth
00:21:24
and the reduction of global debt to support you know a more prosperous world in the future this idea that right now
00:21:29
we're talking about Davos and the world economic Forum as a gathering of global Elites and maybe sax you can kind of
00:21:34
give us the history and the point of view on how that positioning has come about well it's a meeting of of global
00:21:40
business and government leaders so they are the elites I mean you add them all together and they do control a
00:21:46
substantial portion of the world economy and most of the you know nations with the biggest economies so there's no
00:21:54
question these are some of the most important people in the world the bunch of the Articles coming out of Davos
00:21:58
reported the somber mood and tone of the conference the level of anxiety and worry was very high and I think that
00:22:07
for a brief moment it looked like these people were staring in the mirror and realizing that their management of the
00:22:14
global economy over the last couple of decades has been a bit of a disaster I mean you do have ruinous deficits and
00:22:21
debts piling up in the U.S and across the world something like 350 percent debt to GDP globally so we've talked
00:22:28
about that you've got this war in Ukraine that I and many people around the world think was easily avoidable and
00:22:35
was a diplomatic failure you're coming off of two years of badly botched covid mismanagement where the governments of
00:22:43
the world pursued a horrible policy on covet and made everything worse you've got Decades of energy policy promoted by
00:22:50
the world economic Forum where they want to get people off fossil fuels and natural gas and get them onto less dense
00:22:58
less reliable energy including promoting things like organic farming in Sri Lanka
00:23:03
which we talked about on the show cause their economy to collapse you've got the
00:23:06
world economic on promoting ideas like you're going to own nothing in the year 2030 and you're going to be eating
00:23:12
insects because no one should be eating meat so you've got these like wacky extreme you know environmentalist ideas
00:23:19
and anti-capitalist anti-property ideas coming out of Davos so I think the whole
00:23:25
thing's been a bit of a disaster and for a brief moment it looked like these people again were self-reflecting on
00:23:31
their role in creating these disasters but of course the tone quickly shifted to blaming disinformation on social
00:23:38
media as the root cause of all these problems as opposed to their Decades of decision making running you know the
00:23:45
leading nations of the world and the leading companies of the world and I think that the blame is properly put not
00:23:51
on social media but on these leaders for making you know bad decisions do you believe in the benefits of global trade
00:24:00
where countries trade with one another and shift the sourcing of supply and labor to the cheaper source so that that
00:24:07
the buyer can benefit from having things at a lower price and ultimately the global economy grows
00:24:13
as kind of being beneficial to the us over the last 30 years or net negative because we talked you
00:24:19
know about the the obvious consequences of global trade where we've had Industries gutted in the United States
00:24:26
and now we're trying to onshore them again and build redundancy and so on but that's becoming very expensive and
00:24:32
ultimately leads to the inflation of goods and services and so as you look at kind of the yeah
00:24:37
the positive agenda of the world economic Forum over the last 30 years being about improving global trade and
00:24:44
Global relations to enable global trade are you an anti-globalist and you know do you start to see yourself falling
00:24:49
more in that camp as you see and hear more of what comes out of Davos and from these
00:24:54
organizations like them well look all economic Prosperity comes from trade if we didn't have trade then we would all
00:25:01
be subsistence farmers and hundreds and gatherers so we basically specialize in something and
00:25:08
then create an over a bunch of that and trade it for the rest of our Necessities
00:25:11
the issue is that trade not only creates Prosperity it creates dependencies because you're dependent on
00:25:17
the people you're trading with and also it has distributional effects in terms of geopolitical consequences so
00:25:25
trade with China has created some Prosperity but it's also hollowed out the American Manufacturing
00:25:34
sector while also making China very rich which has basically turned China into a
00:25:39
major geopolitical competitor for the United States so I'm not like a free trade fanatic I mean I understand the
00:25:44
ways that trade creates wealth but I think it can also create these downsides that have to be managed and the fact of
00:25:50
the matter is that this unfettered free trade ideology contained the seats of its own destruction because all the
00:25:57
revisionist powers who are seeking to revise the U.S led Global Order they were basically enriched
00:26:04
and built up by the very free trade ideology that neoliberals were promoting so this neoliberal world order has kind
00:26:14
of created the seeds of its own destruction I think that it would have been much smarter for us two decades ago
00:26:20
to be much more restrained in the China trade and to not throw up in our markets
00:26:25
to Chinese products we basically gave them mfn status this is back in the early 2000s and it was a bipartisan
00:26:32
project a bipartisan decision but the result of that has been the rapid rise of China at the expense of our
00:26:39
manufacturing sectors and to the benefit of our consumer class right I mean we do
00:26:42
you have 600 iPhones because of it and we do have cheap TVs and there has been a consumer Market that's demanded these
00:26:49
low price Goods to live a better life right like so yeah but so so everyone gets cheap Goods at Target but in
00:26:55
exchange for that we now have a real peer competitor to the United States which is capable of disrupting
00:27:03
let's say our Primacy in East Asia and you know is creating a much more challenging world so look I I can
00:27:09
understand the reasons why people bought into this two decades ago but I think that if we had it to do all over again I
00:27:16
think most people would recognize that we should not have given China permanent mfn status and we should have been more
00:27:23
temperate in our willingness to throw up in our markets to these countries do you
00:27:29
think that the world economic Forum has kind of transitioned into this kind of neoliberal organization now that's
00:27:36
promoting these neoliberal beliefs that aren't really tied to the original construct of
00:27:42
Global enabling and supporting global trade and supporting the global economy and
00:27:48
creating more prosperity and security around the world I think it appeals to the insecure overachiever Elite
00:27:53
yeah and nobody building anything really gives a [ __ ] about Davos nobody is thinking what's going on nobody even
00:27:59
knows when it happens right so who cares about it people who like status and went to fancy schools and
00:28:07
wants to feel like they're in the club and that's how they've made it is going to this place which underneath
00:28:14
is a membership organization where people pay based on the number of people that get to go
00:28:20
so is it really that important substantively no but overachieving Surplus Elites in the
00:28:28
west really valued the signal that it represents to other overachieving Surplus Elites in the West
00:28:34
so that's what Davos is that's what the Allen and Company conference has become a lot of these things started off
00:28:40
much purer than what they are today but these are all membership driven Revenue generating efforts
00:28:49
in 30 or 40 years the all-in summit will probably become that too it's just the nature of things so I
00:28:57
wouldn't spend so much time focused on a group of people getting together the funniest thing about Davos that I saw
00:29:03
was Zero Hedge which said that the amount of prostitution is at record levels in Davos and so it just kind of
00:29:10
boils down to what it is which is like any other conference it just happens to be with more security guards and less
00:29:16
security guards and the same stupid stuff happens at Davos that happens in Vegas at name your conference CES it's
00:29:24
just a different kind of attendee so I think the bigger thing is that we are learning that the world tends to
00:29:33
have these policy perspectives that swing in a pendulum and the problem with the pendulum is that it it is at
00:29:39
extremes and sax is right we went from an extreme where we were very closed off and we were essentially subsistence
00:29:47
Farmers all of us were and then the pendulum has essentially peaked probably in the mid teens of this
00:29:53
decade or of this Century where we realized too much globalization actually Hollows out
00:29:59
local economies so we need to find the equilibrium point and that inherently has more inflation
00:30:05
that inherently has higher prices and that inherently has slower progress but more consistent progress that
00:30:14
benefits more people and this is what is so ideologically disruptive to again Surplus Elites because they need the 600
00:30:24
iPhone the idea that they can't upgrade every year drives them into such a tizzy that they
00:30:31
need to export all the jobs whereas a thousand dollar iPhone or a fifteen hundred dollar iPhone may just mean that
00:30:39
your upgrade cycle is two years and just ask yourself how many times have you upgraded as soon
00:30:45
as the phone came out to realize man this phone is actually worse than the previous version
00:30:49
and I probably could have just waited and there's a lot of work that actually goes into building these things to
00:30:54
actually make them better so all you're doing is you're giving up optionality you're allowing your brothers and
00:30:59
sisters to struggle to basically Feed The Profit motives of one company that in hindsight doesn't need to happen
00:31:05
so there's an equilibrium and I think that these next few decades will be about finding it we have decided
00:31:12
it's categorical that that level of globalization that we have had this unitary singular
00:31:18
monocultural way of thinking about things is over and David's right it's because that
00:31:24
system has created too many threats to the hegemony that brought us there Jacob and you that's a good thing I
00:31:32
think in general it'll be it'll be more prosperity for more people but it'll be slower and it will create points of
00:31:39
friction that are represented in inflation in higher prices right that's right so as jaycal as you know chamoth
00:31:44
points out like if you're upgrading every two years instead of one year your economy doesn't grow as fast you have
00:31:49
less spending yeah if the price of things go up you have inflation the net cost of de-globalization is higher
00:31:57
prices and lower economic growth that's just fundamental kind of macroeconomics no that's not true that's not true
00:32:03
because the deglobalization in an individual economy will actually create GDP because you'll have to rebuild the
00:32:09
things that are used to import that's right yeah and over a period of time theoretically you could catch up and
00:32:14
accelerate but jaycal like when you weigh this conversation about Davos and globalization and U.S security
00:32:22
against the one we just had which is why I wanted to talk about this we're running into a debt crisis
00:32:28
we have limited spending capacity we have a significant amount of investment needed if we are going to cut global
00:32:36
trade ties that we've depended on historically and start to build redundancy can we afford this as a
00:32:41
country can the West afford this given the economic slowdowns and inflation right now and you know how do we balance
00:32:48
kind of these conversations against our domestic challenges economic Davos has a
00:32:54
pretty serious PR problem they have dubbed themselves like essentially a self-appointed illuminati for the rest
00:33:01
of us and that they're going to set some Global agenda I think this year's agenda
00:33:06
was like finding the future or defining the future nobody asked these people to be in
00:33:13
charge and if you look at what's happened in the world the chaos of covid and you look at what's happened in terms
00:33:20
of energy policy in Europe and then this obsession with social issues and being told you know these
00:33:27
Farmers these truckers you're bad people you're not woke whatever it is I think the public looks at Davos as the
00:33:34
manifestation of these Global Elites who are lording over them some master plan whether it's real or not that they're
00:33:41
not part of and that doesn't take them into consideration and that takes into consideration only their profits and
00:33:47
when you actually peel it back as chimoff correctly pointed out Dolphus is a huge grift they they
00:33:55
recruited me to be part of their world leaders 15 years ago after I had sold did you go
00:34:00
to Second company and I met Claus the guy who runs it uh some New York Four Seasons event and uh then I got the bill
00:34:08
and to be a world leader was 40 [ __ ] thousand dollars and I was like what a global future leader I
00:34:18
don't know what that means uh but I'm not giving you forty thousand dollars you had to pay you had to pay to be a
00:34:25
global what future leader and you didn't have to pay for a six thousand dollar Ted ticket at the time this was 40 large
00:34:34
and uh I just thought you know this is not for me uh and what a joke I think people would much rather see some
00:34:43
resiliency in the supply chain and they would rather see the origins of kovid and why we spent two years in a
00:34:51
lockdown and was that a cover-up of the United States funding gain of research you know being done in Wuhan like and
00:35:03
and why are we shutting down nuclear power plants and what exactly is the energy policy in Germany people are
00:35:09
looking at incompetent Elites going to Davos having a big party and then setting an agenda for them that
00:35:16
they don't understand or want and I think this is where you know the the the contempt for Davos is peaking
00:35:23
this year and it should if you're being invited to Davos and other people are not being invited and they don't have a
00:35:30
seat at the table and a voice at the table you can tell that all the journalists there are on an access
00:35:34
journalism pass what does that mean access journalism they get to come there and they get to hang out with Elites if
00:35:42
and only if their coverage fits a certain profile and if you find me the top 10 most critical anti-globalization
00:35:49
journalists in the world I can guarantee you that they don't have credentials I think it's like a bankrupt organization
00:35:56
that should just be shut down and the people who are going there are involved no I think it's culturally bad you guys
00:36:01
have so much disdain it's interesting no idea not what the world wants right now the
00:36:07
world wants transparency and the world wants ownership of all the screw-ups you know from kovid yeah to energy
00:36:16
policy we want ownership of those issues not a bunch of Elites drinking champagne
00:36:21
I'd rather spend a week with entrepreneurs or frankly spend a week with my kids or Frank yeah spend a week
00:36:25
playing poker with my friends of course let's do it they're they're like umpteen
00:36:29
things that are above the list so it's kind of like let them get together I think it's fine for them to get together
00:36:33
they should do it I just think that if you're not there I would not weigh these things so heavily because it speaks more
00:36:39
to your own insecurity than it does to their actual influence on things yeah the term Elite is an interesting one you
00:36:45
you could companies need a CEO to run the company it's not run by 10 000 employees and governments need a
00:36:51
president to oversee the government and I think the idea that some small number of people that are in charge getting
00:36:58
together is now being cast as an elite Gathering and elitism in itself is the failure
00:37:06
I think it's very important to get this nuanced rights it's a gathering of Elites and that's very different than an
00:37:12
elite Gathering an elite Gathering is when like Michael Jordan and LeBron James and Steph Curry get together and
00:37:18
work on their basketball game that's an elite Gathering a gathering of Elites is
00:37:23
what's happening in Davos but they are the presidents of their companies and the presidents of their
00:37:29
countries so I would differentiate between the people who are merely attending who are paying the Forty
00:37:34
thousand dollars you know probably a bunch of hangers on it's now 250 by the way 250 000 250 yeah anyone willing to
00:37:41
pay that is like you know totally an insecure you know Surplus Elite by the way I just got back from Davos oh you
00:37:48
did okay well congratulations looks good on you though go ahead what's good on you did you spend your own money
00:37:55
or your LP's money no I didn't get it down oh my Lord if I mean one person that went to Davos
00:38:01
and spent their own money that's like probably not right exactly so then there's the hangers on you're spraying
00:38:05
250 000 to feel important but then there's the people who are invited who probably don't spend any money who are
00:38:11
basically speaking right and you got to say that the the group of people who are
00:38:16
speaking at Davos individually and collectively are quite influential they are the leaders of countries and and
00:38:24
Fortune 500 companies sure but you can agree that they literally don't say anything that's noteworthy because
00:38:29
they're not allowed to they're not saying anything that's that different of what they would say the previous week or
00:38:33
the following week so but it's it's a forum it's a platform for yeah it's a 44. yeah to get together look in terms
00:38:42
of the critique of it Freebird you asked how far back does this go it's this is not like a new
00:38:48
thing the the term Davos man was coined back in 2004 by a Harvard Professor Named Sam Huntington who wrote a book
00:38:56
called class civilizations he's the Press of international relations at Harvard and he coined the term Davos man
00:39:03
to refer to a globalist Who quote had little need for National loyalty who viewed National boundaries as obstacles
00:39:10
that are thankfully uh Vanishing that's how Huntington defined Davos man and there's been a reaction to these Thomas
00:39:20
men that's been growing for a couple of decades I mean obviously the election of
00:39:24
trump was a reaction to that brexit was a huge reaction to that and I think that the resistance to the
00:39:33
imposition of their again their globalist policies which I guess you could Define as believing in this like
00:39:38
borderless world you know economically and politically I think that's been receding in favor of more nationalist
00:39:45
leaders who want to promote their own country's interests and I think that that trend is going to continue
00:39:51
let's let's transition this to the the broader question that I think we got into it a couple episodes ago on how can
00:40:00
we afford this transition if there is this mounting kind of trend against globalization
00:40:08
that's mounting deglobalization movement and effort particularly in the U.S and again as sax pointed out Global debt to
00:40:14
GDP is something like 300 to 350 depending on how you count and we're running into a debt ceiling here in the
00:40:22
U.S I guess the question is how do we afford to build the infrastructure redundancy
00:40:28
and make the Investments at home to replace global trade can we afford to do it and how's this going to play out as
00:40:35
we run into this you know debt ceiling vote I don't think that's the right question I think it's the inverse of
00:40:40
that question how can we afford not to with the amount of discontent and the amount of economic strain that people
00:40:46
feel if you want to really call populism you're going to have to create economic
00:40:52
vibrancy at home when people are making money and they find purpose they're less agitated they're not
00:40:58
storming the capital they're not electing Fringe candidates they're not doing domestic terrorism they're just
00:41:05
going to work and building a life right we know that so how can we afford not to
00:41:10
how can we afford not to like bring back jobs to the heartland of America so the
00:41:16
reality that I have and I think a lot of people have is that this debt to GDP thing is a bit of an intellectual red
00:41:23
herring and the reason is people talk about this thing constantly in these absolute terms with no historical
00:41:31
precedent that relates well to our current moment there is no magic number at which thing this experiment that's
00:41:38
called America fails so I think that you have to be a little bit more intellectually honest and say
00:41:43
that at best it's a relative problem and it's relative to the countries that have already established dominance of
00:41:51
which there are eight or nine and then the emerging economies and then thinking about what critical things will
00:41:58
they bring to the table in 15 or 20 years from now and in that context I think that people
00:42:03
will him and ha But ultimately they'll capitulate they will raise the debt ceiling and they'll continue to fund
00:42:10
this transition away from globalism and I think that's the argument that we'll get the Republicans over the line
00:42:16
because it's going to bring a lot of spending and stimulus and jobs to frankly a lot of red states that would
00:42:23
otherwise kind of continue to wither and die on the vine I think here's my biggest concern
00:42:29
we're either trying to walk a tightrope or there's no tightrope to walk and if we make these Investments and they're
00:42:37
not economically viable Investments it's a path to ruin and what I mean by that is if we're
00:42:44
building factories manufacturing facilities infrastructure that relies on yesteryear's technology and systems of
00:42:53
production and Glo and and kind of economic systems and there are alternatives that are competing on a
00:42:59
global stage that are better more productive more advanced then we lose and we've made an investment in a
00:43:05
negative Roi way can I ask you a question yeah see when you say that though you're making a very
00:43:13
basic assumption which I think you can question which is you are underpinning that on fundamental economics that can
00:43:19
change if we choose to for example let's take like natural resources okay every time you do a plan the industry and I
00:43:27
Define the industry as every for-profit company and Wall Street and the debt markets they refuse to underwrite this
00:43:34
thing at a higher cost of capital they use a whack of six or seven or eight and they will fight tooth and nail to use
00:43:42
the smallest discount rate possible because it allows them to capture more of the profit dollars but if you
00:43:49
actually had a realistic whack of like 10 percent on an on a massive infrastructure project guess what you're
00:43:56
actually pretty equivalent to a government and in fact in many cases a government becomes cheaper so I think
00:44:02
the thing that is worth debating and I'd like your reaction to this it's not that
00:44:05
what you're saying it's we refuse to change the guard rails on our profit-making ability and if you
00:44:12
extended the window if you change a discount rate if you said PES can be different you would have a very
00:44:17
different economic justification for what you just said it completely changes a hundred basis points changes
00:44:22
everything you're saying by tens of years one way to describe that yeah is another way to reframe what you just
00:44:28
said is that the youthful lifespan of an investment isn't 40 years or 50 years but it may be 12 years and if you if you
00:44:38
recast the investment decision as this has to be a 12-year return instead of allowing it to be modeled as a 40-year
00:44:45
return then you start to really filter out a lot of the nonsense and you can actually see real payback it doesn't
00:44:50
make sense to spend a hundred billion dollars on a train to take people from LA to Fresno or whatever craziness the
00:44:58
the California High-Speed Rail program has turned into it was originally like a billion dollars to go from LA to San
00:45:04
Francisco there was economic justification to get payback on 100 billion dollars or whatever it's
00:45:09
ballooned into the whole system should be shut down so I guess there's a from a policy
00:45:15
perspective an accountability framing that's missing but also bringing in the time Horizon on which we need to get
00:45:22
paid back for these things my point was that in China and I've made this point many times but I just think it's a
00:45:28
really important one that'll play out over the next couple of years they're building 450 nuclear power plants
00:45:33
they're going to get the cost of industrial power below five cents or four cents a kilowatt hour and they're
00:45:37
electrifying all their factories as they do that it's no longer a unit of human labor that's needed to produce Goods
00:45:43
it's a unit of electricity and if they're driving down the cost of electricity and all products can be made
00:45:49
using electricity you have a huge economic Advantage it's not the cure-all that you think that is even if you have
00:45:55
free energy you have to think about the inputs and the thing about China but no sorry I'm not talking about energy I'm
00:46:00
just saying a general framing like no no I understand my point being like the Investments we should be making are
00:46:06
where is the puck headed not where has the puck been no no so I just I just wanted to comment on where the setting
00:46:12
even if energy is zero in China you have to think about inputs meaning factories
00:46:16
make things with inputs and if you look for example in natural resources the inputs by and large don't exist in China
00:46:23
and so all I'm saying is that all of these inputs whether again you can take natural resources that proliferate
00:46:31
massively in the United States it turns out that India is utterly utterly utterly poorly addressed in a
00:46:38
geographical survey perspective and we're finding that India's raw resources are off the charts okay there are
00:46:44
certain places in Africa tons of stuff in Indonesia and Australia all of those things may not have to go to China
00:46:52
because there are subsidies or there are equivalently cheaper decisions that governments can make so that they choose
00:46:59
not to send it and all of a sudden all of that spending doesn't matter as much because the Australian government makes
00:47:05
a trade-off that says you know what I'd rather have these jobs here and I'm willing to have a longer payback cycle
00:47:11
for these jobs to be here then instead of ship it to China and he they tell that they tell the
00:47:16
Australian citizens I'm sorry guys but you're gonna have to replace your car every seven years as opposed to every
00:47:22
five I hope you're okay with that but that'll mean full employment and it'll prevent Fringe candidates and populism
00:47:29
and let's go forward where do you invest ing I am investing a lot of money in those places that control the natural
00:47:41
resources that are poorly understood meaning there are places like India where our Geological Survey capacity is
00:47:51
relatively naive and it turns out that in critical parts of the energy supply chain or other places
00:47:59
they can play a huge role and the Indian government's cost of capital has an element they're sophisticated
00:48:07
enough to add a an element to the formula that accounts for Full Employment if I build it in this state and if I try
00:48:17
to get this many jobs created the full circle feedback of that allows me to actually transfer price it into
00:48:24
the Indian Market at this price which is cheaper than anything that China can do
00:48:28
even at zero energy that's the kind of sophisticated decision making that is emerging because
00:48:34
of this deglobalization trend and it's happening everywhere so the Indians are doing it the Germans are doing it and
00:48:40
then the US is doing it and then on top of that what they're what they're doing in terms of Game Theory which I think is
00:48:46
even more sophisticated is they're not letting China be alone they're actually now slowing China down
00:48:52
because China turns out actually needs inputs from these Western economies and they're like we're just not going to
00:48:57
give them to you anymore so do the best you can for example in semiconductors the Dutch the Germans the Americans
00:49:03
we've now essentially embargoed all of our most sophisticated equipment from ever getting in there that will increase
00:49:09
even with zero energy the cost of what comes out of there and that will balance the playing field so that the Germans
00:49:16
the Dutch the Americans can bring other partners in at a different cost of capital to make it economically neutral
00:49:24
in that parity and the reason they'll do it is to create jobs for Americans or the Dutch or for the Germans okay I
00:49:31
think the most yeah go ahead Jacob freeberg I I just I I think the most important thing here isn't like energy I
00:49:37
don't think it's infrastructure I don't think it's natural resources at least for America it's entrepreneurs and
00:49:43
that's what it's always been for this country and it's immigration is the Silver Bullet here and
00:49:50
inspiration and the freedom that this country has for entrepreneurs and Founders to pursue a vision to start a
00:49:57
company that's why we've won so big historically is the the combination of immigration and the inspiration that
00:50:04
these entrepreneurs do on a global basis to get more entrepreneurs to come to this country to
00:50:10
go to Stanford to start companies and that's why China is now losing they cribed this incredible formula we had of
00:50:18
letting Jack ma do Alibaba and then they decided to for whatever you know insecure or stupid reason or pragmatic
00:50:27
reason to consolidate power and that's what will push the world forward and and make our country Thrive we have to fix
00:50:35
immigration we have to keep letting entrepreneurs Define the future because the government
00:50:40
can do so much they can underwrite a couple of Chip factories here or there sure we could put money into nuclear or
00:50:47
fission or fusion and whatever the next technology is but you need a singular person who wants to make it their life's
00:50:53
mission who wants to have their sense of Pride and Innovation push the world forward and those people are
00:51:00
rare and we are in a competition globally that we are not focused on that we need to get refocused on to recruit
00:51:08
the greatest Minds in the world who want to change the world to do it on American
00:51:13
soil I do not disagree with you jaycal I think you know to my earlier comment about how
00:51:19
do we walk the tightrope of the debt burden the deglobalization and populism movements
00:51:24
and the and the challenges and opportunities ahead it has to come through Innovation I think that's how
00:51:28
you you have to invent a new tightrope basically I think the challenge though is Freeburg that
00:51:34
it takes a recognition that there are singular individuals in the world one in a million one in ten million one in a
00:51:41
hundred thousand whatever it is who can just drive an entire economy forward whether it's gates with
00:51:47
Microsoft or Steve Jobs with apple there are singular individuals who come to this country Bam Bam Brogan with uh the
00:51:55
tunneling company nobody knows what you're talking about except for me there are people who will push these
00:52:05
things forward and and take risks and we have to yeah recognize that it's a small
00:52:10
number of individuals backed by a large amount of capital that create massive jobs and great
00:52:16
prosperity it's an uncomfortable conversation for people to realize that it might just be a couple of dozen
00:52:21
people a year immigrating to this country that change the fate of this country yeah why do you
00:52:28
need to allow three million migrants to stream across the Sun border every year because you don't know which one it's
00:52:33
going to be that's why really you know that's that's your immigration policy is open border
00:52:39
so that one is a millionaire I said recruitment so you're immigration yeah explain that
00:52:46
it's a great question sex there are there are two things to look at here there is Jason let me finish my sentence
00:52:52
no I'm just going to ask you to just verify as you say it's you're are you saying that the PHD student that starts
00:52:57
Google is streaming across the border or actually applying for no absolutely notified
00:53:05
for you there's immigration and then there's Recruitment and if we frame this process with those two different words
00:53:13
there are people who are yes immigrating streaming across the border however you
00:53:16
want to frame it sax I don't look at it in a political way and then there's recruiting the most elite talents in the
00:53:23
world we can do both of these things one of them you know uh helps Farmers have people to work the fields
00:53:31
to have people take entry-level jobs to work in the service industry we should bring in two or three million of those
00:53:37
people per year we should make it legal and we should celebrate it because we have so many of those positions open
00:53:43
that Americans don't want to take we should then also in parallel and without confusing the issue for political
00:53:50
reasons recruit people to come to our universities and when they graduate have their citizenship staple to that diploma
00:53:58
and not let them leave the company country and let them start companies here instead what we do is we make them
00:54:04
fight to stay here we should be recruiting the smartest most talented people that will be hundreds of
00:54:10
thousands of people per year low hundreds of thousands okay Millions coming across the border sick J Cal is
00:54:15
very reasonable no yeah it's great yeah I think he's so much better when he doesn't moderate yeah yeah go ahead sex
00:54:22
you know I'm an immigrant you know my dad came over yeah my dad came over in 1977 when I was five years
00:54:31
old of course he had an MD he was a doctor he actually had like skills and wasn't immediately can become a net
00:54:39
government dependent so I think that it makes sense to allow immigrants who can actually add
00:54:44
something to our economy and bring skills and all the rest of it but the problem we have is that if you want to
00:54:49
take that reasonable position you're told that you basically have to accept a situation of de facto open borders which
00:54:56
is ridiculous no you don't these are two separate things and they've become inflated it's the number one party that
00:55:05
conflates these two issues you know they're two separates Democratic party is conflated these issues okay both
00:55:10
parties are conflating them here at the all-in podcast can we agree that yeah a group of people could recruit people for
00:55:17
PHD programs more than one group of people allows across the border to take service jobs
00:55:22
is the way to go but but look let me tie this back to Davos man what was the definition of Davos man it was somebody
00:55:29
who is pushing this ideology of free trade and open borders to such an extent that it creates a nationalist backlash
00:55:37
or populist backlash fair enough yeah that's exactly what's happened at our Southern border is you have the people
00:55:44
who believe in Immigration push that ideology to such an extent that they won't create a rational sensible
00:55:50
Southern border and process in our Southern border it's chaos down there I'm in favor of bringing in the Dream
00:55:57
Team yeah in favor of bringing the Dream Team but the response of open borders is
00:56:02
the creation of this nationalist movement right the Nationalist movement only exists in the face of open borders
00:56:07
I think that's that's the point right like the extreme there's the extreme I think the
00:56:13
immigration system should be based on points just like Canada Davos men don't if the Davos men don't start taking in
00:56:19
start taking into account these National considerations around the defense of their borders and
00:56:26
these issues around trade hollowing out the middle class then there's going to be an intense backlash and I don't think
00:56:32
those Elites have been managing the situation very well it would have been better for them to pursue the more
00:56:37
nuanced policy you're talking about why are we conflating the issue then why do the Democrats and the Republicans sacks
00:56:43
make this such a polarizing issue instead of stating it the way I did recruitment
00:56:47
because it's so busy you know when you when you conflate them you can incite an emotional response
00:56:55
from your voting base that's it that's 100 of these issues that's why all of these issues get based out they get
00:57:01
spaced out to the point that then you can drive someone to vote for you because you've now framed the other side
00:57:06
as this extreme side and yeah you earlier said hold on before you got suddenly very reasonable you said that
00:57:13
we have it's always where you haven't listened I'm in a quote something you just said a
00:57:18
minute ago you said that we had to allow two to three million two to three million completely destitute practically
00:57:24
illiterate migrants to stream across our border because one in a million of them
00:57:28
might be an Elon Musk no no this could be no no hold on I was talking about you can take it back
00:57:34
immigration typically includes when you say that word the Corpus of people coming in for
00:57:40
education and the people coming across the southern border so if you were to say immigration most people would
00:57:45
recently say that's both of those buckets I separated them out here so we could have a reasonable discussion
00:57:49
recruitment of higher education talented people with low education migrant workers they are two different
00:57:58
buckets and you have to be able to say these are two different buckets and that we should have a point based system if
00:58:05
and this is the conversation that doesn't happen amongst politicians but can happen here look at Canada look at
00:58:10
Australia they have what's called a point-based immigration system they give you points for everything that you bring
00:58:16
to the country if you bring money if you speak the native language if you have a
00:58:20
degree if you have a higher education degree or you have skills that that country needs our country needs to move
00:58:26
to a point-based system if you're coming across the board and you don't speak the
00:58:29
language and you don't have an education you have zero points if you have a master's degree
00:58:34
two or three points and you can let in buckets of people based on compassion based on meeting service workers and
00:58:41
based on needing the next Elon Musk or the next David sacks or Shabbat polyhapatia I think the the argument
00:58:47
jaycal is that the compassion argument falls on deaf ears in a time where people feel we cannot afford it and it's
00:58:54
a luxury to embrace that's the level of immigration right now just pick a number
00:58:57
we can reasonably absorb this is what finally look at the southern border and see chaos obviously they want to get
00:59:03
that under control before they're going to adopt your you know point-based system we can do two things at once we
00:59:09
could do another point-based systems I like the idea of I don't know if my point was your points but in concept I
00:59:17
like to find your points no no we don't need to I like the idea of admitting immigrants based on skills
00:59:23
the country actually needs and a simple recognition that's better to bring in people who are neatly productive hold on
00:59:29
they could add to our economy as opposed to being net government recipients dependents we're done we're done there
00:59:34
are countries I just want to make a point there are countries the Scandinavian country specifically that
00:59:39
have said we can accept up to this many folks who are uneducated who don't speak
00:59:44
the language because we have this many teachers and this many slots in school and so I think it was Finland and Sweden
00:59:50
they said we can accept 50 000 per year of this type of immigration based on compassion that's the reasonable
00:59:57
discussion that has to happen here did you just say that we have to do these two things at the same time
01:00:01
meaning that until we impose a an overhaul of our entire immigration system to be based on skills and points
01:00:08
that we can't enforce the southern border no I think you can enforce the southern border and do it at the same
01:00:15
time let me just tell you there's going to be Canada and Australia are already doing
01:00:21
it let me just tell you there's not going to be a broad-based constituency in this country for the type of
01:00:24
immigration reform you're talking about until you get the southern border under control because people look at that on
01:00:29
the news and see chaos and there's no excuse me they should be thoughtful they should be thoughtful and
01:00:35
they should just look at what Canada and Australia have done those countries have
01:00:38
actually controlled this and it's not a polarizing issue there it's a pragmatic issue okay guys I'm going to move us
01:00:43
forward to the uh the Banning of tick tock so I want to kind of change the the tone a little bit
01:00:51
this uh story recently is that Tick Tock has been banned for use on the campus Wi-Fi network let's go
01:01:00
at a number of universities including UT Austin Auburn Boise State the University
01:01:05
of Oklahoma so college students can't access the app when they're on the campus Network this is following 19
01:01:11
states that recently banned Tick-Tock and government devices as everyone knows Tick Tock is a product
01:01:17
from bike dance which is a chinese-based company and there's been quite a lot of
01:01:23
political and Regulatory Huffs and Gruffs about bike dance having this level of insight and access
01:01:30
to users in the United States with the Assumption being that much of the data that they're pulling out of the app is
01:01:36
available to the Chinese Communist party which creates a security threat to the United States
01:01:44
that's one argument I think there is also a significant tie-in to bike dance there's over eight
01:01:52
billion dollars of capital invested in bike Dance by firms that we know well like Sequoia Capital tiger Global kotu
01:01:58
Susquehanna and others they're trying to find a way to monetize their investment
01:02:02
in what is truly the most viral fastest growing highest revenue growing biggest startup in the world right now in bike
01:02:10
dance so there's a restructuring proposal apparently underway that's being discussed in Washington DC right
01:02:15
now to try and restructure the organization and the ownership structure and the oversight of tick tock and bike
01:02:21
dance such that U.S regulators and U.S companies can oversee the data the use of the data the algorithms underlying
01:02:28
Tick Tock and monitor them from within the United States question for this group here on the McLaughlin group
01:02:34
of 2023 is does that do enough for you McLaughlin do you guys think that that's enough
01:02:41
first up is uh chamoth who's been silenced for a bit I think this is really bad news for bite dense basically
01:02:47
what's happening is that and tick tock all the frustration that all these legislature legislators and politicians
01:02:54
have had over Facebook and Google and other sort of big tech companies is going to get focused on bite dance
01:03:04
because you have this common enemy that you can point to as a boogeyman of sorts
01:03:08
and I'm not saying that it's right but I think that what you're starting to see is it's much easier
01:03:13
to pick a fight with the Chinese company and win and get broad-based support than
01:03:18
it is to pick a fight against an American company with a bunch of American employees and American market
01:03:24
cap and American know-how and American IP that gets impacted so I don't think this is going to end well
01:03:32
for tick tock and I think the goal if I were any of these people on the cap table
01:03:37
would be to sell it in secondary to somebody else and get out I think the next big shoe to drop
01:03:46
is going to be advertisers who come under a lot of pressure so for example think of all the
01:03:52
advertisers that have left Twitter there is a point of efficiency where you can live with all of the mess that
01:03:58
Twitter has because it comes with a lot less scrutiny and oversight and political pressure than advertising on
01:04:03
tick tock and that I think is the next kind of like big wave here so I think it's very very bad I think the
01:04:10
Enterprise value of this company is quite challenged and these guys should try to sell and
01:04:17
get up who are the buyers in that secondary Market though I mean that's a lot of capital the thing is the cap
01:04:23
tables haven't been segregated so what you own is equity and bite dance right but the problem is the look through
01:04:28
ownership would will discount a lot of tick tock if they see a lot more of this stuff happening you guys have to
01:04:34
remember this is the first three or four weeks of 2023. wait till we're here in September and October or November wait
01:04:40
till the election year starts it's not good so it's a discount on bike dance that
01:04:48
probably takes bike dance down by 70 or 80 billion so that's a 35 40 discount to
01:04:54
their last mark so you know if somebody can sell in the high 100 billions of dollars I think you
01:05:00
should I think they should probably they should consider it there's it's worth it I think Jacob I know
01:05:05
you've got strong opinions I think you have to be incredibly pragmatic here this is the same as the 5G issue you
01:05:11
cannot trust the Chinese government to not steal intellectual property or to put back doors into the software it is
01:05:18
common business practice there Huawei was banned they basically stole the source code from Cisco that was proven
01:05:24
and it was proven that they were spying on people Canada the UK the United States Vietnam everybody has banned
01:05:31
using 5G technology from China for a reason because they will use it to spy on you this is uh the nature of an
01:05:40
authoritarian government it is far too powerful to have a not only the surveillance capabilities
01:05:46
that are built into owning Tick Tock in the hands of the Chinese Communist Party
01:05:52
to have the ability to very in a very nuanced fashion Trends certain videos that would steer
01:05:59
the United States in a certain direction yeah stupidity is one of course right they're letting their you need 16
01:06:08
minutes that 60 Minutes clip is incredible right they're showing science videos to the
01:06:13
kids in China exactly and they're showing stupid nonsense to the kids in America what do you think over they're
01:06:18
trying videos our children versus their children you can be 100 certain they're doing psyops
01:06:23
on our children as we speak they are trying to make us dumb and distracted while they get smart and sharp by the
01:06:29
way it's very simple if you're a Zucker so this is not the choices of our kids the algorithm just gives you more what
01:06:36
you want exactly of course but that that's like saying if you gave kids a choice between broccoli and chocolate
01:06:41
bars of course chocolate bars if you put this on the supermarket and say eat they're gonna go right to the cereal the
01:06:46
job of a parent tax is number one know their name and then number two differentiate genetic pen and Pad sex
01:06:52
good things and that's your questions the future is not bright for tick tock here because it's gotten caught up in
01:06:59
the geopolitical Rivalry between China and the United States and that's only going to keep getting more and more
01:07:04
intense the US and China are headed for a big security competition and by dance is caught in the middle so I agree with
01:07:10
Jamal about the future but you know this claim is made that Tick Tock is spyware
01:07:17
and you know it's listening to you it's surveilling you it's keeping track of you like what is the evidence for that
01:07:23
claim I just want to understand that a little better like has anyone ever proven that like Tick Tock is spyware
01:07:28
and if it is why doesn't Apple stop it can you just explain that to me yeah I think apple has a complicated
01:07:35
relationship with China so the claim that they're not going to believe all right so Jake your claim is let me I
01:07:41
just want to pin Jake out down on the first section your claim is that 100 Tick Tock is spyware and apple is
01:07:48
letting it happen because their relationship with the CCP I do not have the evidence of specific instances of
01:07:54
them spying but I do know that this is what the Chinese government uh aspiration is is to be able to have back
01:08:00
doors to spy on all Americans that's why they you know are trying to get wow away
01:08:06
well you don't even need to know that because you can just open your eyes and look at and I mean that's an insult but
01:08:13
you can just look at what Tick Tock has the access to it has access to your location has access to your camera roll
01:08:18
and it knows you know uh everybody in your Social Circle because it has your address book
01:08:25
so by having your address book having your location and having access to your photo role they have you compromised by
01:08:31
default the default settings when you install Tick Tock it turns on local network turns on microphone turns on
01:08:37
camera turns on background app refresh and turns on cell data so tick knock is no worse than anybody else
01:08:45
in that because a lot of other apps are very aggressively trying to harvest all that data as well sucks like it's like
01:08:51
Alexa's always listening to you right but you feel but you feel safer with Alexa because it's a it's an American
01:08:57
company or the perception of safety is there so I don't think there's a huge thing to prove other than yeah there's a
01:09:04
setting that allows you to turn on the microphone and it's a default and they do it but they were caught I just want
01:09:10
to make sure you guys understand this according to the New York Times by dance the Chinese parent company of tick tock
01:09:14
said on Thursday that an internal investigation found that employees had inappropriately obtained the data of U.S
01:09:20
Tick Tock users including that of two reporters over the summer a few employees on a bite dance team
01:09:26
responsible for monitoring employee conduct tried to find the source of suspected leaks of internal conversation
01:09:31
and business documents to journalists in doing so the employees gained access to
01:09:34
the IP addresses and other data of two reporters and a small number of people connected with reporters via their Tick
01:09:40
Tock accounts they were trying to determine if those individuals were within the proximity of by dance
01:09:44
employees according to this company so there's an example of them using the technology to try to track down leaks
01:09:49
hold on a second that's exactly what any app a company can do the photos the screenshots we got from Twitter that
01:09:57
were shared in all those files or whatever that happened a few weeks ago showed that that many Twitter employees
01:10:03
were able to log in and just view the direct messages between Twitter users and that there's no necessarily blogging
01:10:09
or access privileges required to have access to that information there are these holes in all of these social
01:10:15
networking and consumer uh digital consumer product companies that allow individuals to go in and do things
01:10:23
it's a feature sure but it doesn't reference like some systematic um yeah but those aren't controlled by a
01:10:29
government agency no that's that's the key thing what Jay Cal just said is a key thing everybody tries to get these
01:10:35
things turned default on every app tries to get access to your camera roll to your contacts to turn on the microphone
01:10:40
the problem isn't that those settings exist because Apple created them and Apple created a privacy framework where
01:10:47
you have to opt out of it okay the issue is that that data instead of going to an
01:10:52
American company with American on a with American data centers and American Service it's going to somebody in China
01:10:58
or it's the perception that that's happening that I think is a Death Note and this is also excluding all of the work
01:11:07
that every single big tech company must be doing to point the finger away from them and this is something they can all
01:11:14
agree on if yeah if you got Andy jassy and Zuck and Sundar and Satya Nadella in a room what do you think they could all
01:11:22
agree on hey guys are we better off pointing the fingers at each other or should we just point it over there to a
01:11:26
company based in China so do you think do you think that Tick Tock in a way is being scapegoated here
01:11:32
or do you think it's a real security threat both both yeah that's yes to both and you know what I think what we saw
01:11:38
with the the Twitter files for me personally the one that uh was most concerning
01:11:44
was the fact that the FBI was being treated they didn't have control of it like the Chinese
01:11:51
government has control over by dance at a wholesale level but they were being given
01:11:56
you know pretty um close to giving God privileges but they had more influence than they should
01:12:03
have and they should have gotten subpoenas right so even in a democracy like the United States you can see the
01:12:07
FBI using techniques to get employees on their side to get information on specific users
01:12:15
imagine if the FBI just had God Mode for Twitter or Facebook like what would happen even in a democracy we see it
01:12:21
happen we see abuse the Chinese government is a Communist party they have no problem sucking the
01:12:28
data down of every single person and using it however they want I think the the problematic thing is
01:12:35
that when you look at the capital structure of these Chinese companies post now XI being ruler for life is the
01:12:42
Chinese government has typically a seat on all of these boards they also typically have a golden vote
01:12:49
and so when you think about the governance the governance of these companies has tilted far away from a
01:12:56
normal cap table where it's one shareholder one vote two you are allowed to exist on this cap table at the
01:13:03
benevolence of the government and so I think that you have to factor that in as well Sac
01:13:08
so you know is it Amplified probably but is there also non-trivial risk that we would never give to any other company
01:13:17
absolutely like you know take the opposite example how would we react if the government had
01:13:24
a golden vote and a board seat on meta going into an election I mean one party would be crazy and the
01:13:36
other party would stay mum's the word that's what would happen well I mean let's talk about but let's let's be
01:13:41
pragmatic the news reports that came out this week indicate that they're talking
01:13:45
about restructuring bike dance so let me propose this to you guys if Tick Tock us
01:13:50
were set up as Tick Tock us Inc it's its own C Corp it's based in the U.S and bite dance owns
01:13:57
passive non-voting shares in Texas all the software all the services the algorithms are all run in the US the
01:14:05
data is only sitting on servers and the Chinese have an economic interest ultimately and what happens with that
01:14:10
asset but that asset is entirely managed right that's totally fine that should be
01:14:14
a goal in the US shut it down or do that and if that happens you trigger cepheus
01:14:19
so you'd have to then make an exception that sounds like it's part of the discussion that's underway right now is
01:14:24
how do we get past this regulatory hurdle because I don't know guys I don't know how you turn off Tick Tock for 100
01:14:30
million people that are using it for two hours a day guys we're rejecting deals left right and
01:14:39
Center at much much smaller thresholds because of cepheus because it's we're not and we're not even dealing with
01:14:43
China assume you get past if yes assume that there's no that thing that's right away it's a bad assumption right but
01:14:50
like that's obviously there's eight billion dollars a capital that's right the minute that if you at the Chinese
01:14:55
government around and do an end around on cepheus to own 30 passively then everybody who's
01:15:02
had a deal rejected for a much smaller threshold for a much more benign issue will sue
01:15:08
except that they started with this asset versus buying into it right that's the difference and what they're doing is
01:15:13
they're seeding that the difference here is their seeding control of the asset to
01:15:17
U.S investors and oversight by the US government versus the reverse which is trying to come in and buy an economics
01:15:23
that's not what cepheus adjudicates it doesn't adjudicate where was this originated adjudicates in this cap table
01:15:28
does this person exist should they exist at what threshold what do they know and
01:15:33
are we giving something that we shouldn't give and I'm saying yeah let me give you another um interesting if
01:15:38
the pragmatic answer is you can't just make up a bunch of stuff that blows up a bunch of others though let me frame it
01:15:43
differently what if bike dance sold Tick Tock us to a U.S owned private Equity Consortium I'm a U.S private Equity
01:15:50
Consortium that effectively bought Tick Tock us and operated it here in the US but that's exactly what should happen
01:15:55
but my point is those people are smart enough to not pay full price they'll say you're [ __ ] that asset is worth zero I
01:16:03
will buy it for 10 billion dollars take it or leave it and you know what they'll
01:16:07
have to do they'll have to take it so my point is the equity value is so impaired
01:16:11
in this thing would you buy that for 10 billion of course I'm a buyer but these guys are smart enough to drive a huge
01:16:17
barg a hard bargain so if you're existing on the cap table and you've marked it at 320 I would be [ __ ]
01:16:23
selling it okay well look something like this is gonna happen so it'll be interesting to watch and if any group of
01:16:28
people got together and tried to actually buy it for what the fair market value is worth via a spreadsheet is a horrible
01:16:36
investor In This Moment if you should hold a gun to their head and you should extract a massive pound
01:16:42
of Flesh that gives you a huge margin of safety and makes you money good we know
01:16:45
people who are shareholders if they could have sold it at 320 or 120 they would have sold already well no there
01:16:51
are there are people that will buy this thing in the hundreds that's in size then sell everything you can and then
01:16:56
put it into another company now the problem is you have to show a markdown because you've already marked it at 320
01:17:01
so I got to take a 65 discount yeah if you're if if you're underwater you're underwater but for anybody who got into
01:17:07
the sub 1 billion round you can't eat irr and you can't eat paper markups you can only eat the distribution so get the
01:17:15
DPI and move on as well get the DPI and move on it's another bet you could place
01:17:18
Why Try to okay be greedy and get the last 3x out of this investment I want to move away from software meets Leisure to
01:17:25
software meets human health and productivity a couple weeks ago we were going to talk
01:17:30
about this last week it was announced that bio and Tech was buying insta-deep insta-deep is a broad horizontal AI or
01:17:36
machine learning tools company services business they partner with big businesses
01:17:41
to help them build out ml driven infrastructure to improve their products and their
01:17:46
operations and their businesses one of their customers was bioentech the company that designed and owned VIP for
01:17:56
the original Pfizer covid vaccine one of the original Originators of mrna-based technology bioentec doesn't
01:18:05
just focus on mRNA technology they also focus on cell and Gene therapies the the
01:18:10
novel new kind of modalities that are emerging in in Therapeutics and you know it was a really interesting
01:18:18
acquisition it was a 250 I think person team that they bought the company for about 600 million dollars specifically
01:18:24
to improve how AI can be used to accelerate drug discovery I'll just make a comment on this and
01:18:31
then sax I'd love to kind of hear your point of view on these types of businesses broadly
01:18:36
the capabilities of machine learning when applied to a particular vertical are quite profound I you know I've
01:18:42
certainly been involved in this space in agriculture and increasingly doing more
01:18:46
of this work in Pharmaceuticals and and biotech and you know when you can have large
01:18:52
unique data sets that you can then model using these tools and these capabilities
01:18:57
and be predictive about what the next product iteration should be it can really change the value and the
01:19:04
trajectory of your business one of the big trends in Pharma right now is to move from in vitro testing meaning
01:19:10
you're running biochemical experiments in labs in assays iterating testing experimenting to see what molecules work
01:19:16
or what protein does what and if it binds to the Target and doing more of this in silica as it's being called
01:19:22
which is in software and rather than just doing testing and software you can actually use tools like Alpha fold that
01:19:28
can be predictive of large molecules and how they can drive outcomes to make decisions about what to put in
01:19:34
your pipeline so if you take 99 of the junk out of the top of your pipeline and you only focus on the one percent that
01:19:40
the software predicts will be more successful you much more quickly get drug Discovery through the pipeline and
01:19:46
you have a much higher hit rate so the ROI is extraordinary particularly when you're talking about multi-billion
01:19:51
dollar revenue streams coming out the other end of that pipeline and so I think you know the way this reads these
01:19:56
guys raised 100 million dollars in a round last year sold the company for 600 million it seems very similar to
01:20:02
deepmind being bought by alphabet a few years ago where the application of the the team is pretty broad across a number
01:20:07
of opportunities but bioentec bought them to focus on the kind of Pharma space so I guess tax you know in in the
01:20:15
earlier stage and you know I see a lot of teams now that are like Hey we're AI for this or ml for that a lot of
01:20:21
Pharma and biotech deals have to have the catchphrase ml or AI in their writing now because of the economic
01:20:28
Improvement of those businesses are you looking at Enterprise software businesses that aren't necessarily about
01:20:34
the typical subscription model where you sell a seat license and people pay for that but have
01:20:40
this broad tool set and toolkit where these folks are earning Revenue share or participating in a Services Revenue
01:20:46
stream for enhancing the value of their their their partner in the AI or ml space and
01:20:52
what's the Better Business model because I think this is where so many new teams
01:20:55
are starting out is what's the business model and what should we be focused on with our ml toolkit
01:21:02
I mean the short answer is no we're having done any deals like that uh I mean we're not Pharma investors so I
01:21:09
don't know how I would be able to evaluate even if it is a software product I don't know how to evaluate its
01:21:14
um effect on Pharma outcomes so I mean we haven't done any deals other verticals I mean like do you look at ML
01:21:20
and AI companies that are more services or partner oriented versus just selling seat licenses to a software tool I mean
01:21:26
is that a big Trend you're seeing I don't think we have enough data to tell you what the trend is we did a deal
01:21:31
called Pearl which is creating an AI for Dentistry so what it'll do is it scans in all of
01:21:39
the x-rays and you know down records from from Dental practices and it gives a kind of a second opinion it can spot
01:21:47
things like cavities and things like that or just changes in the condition where it's really powerful is over time
01:21:51
right if it's got your last six sets of x-rays over uh whatever six year period it can detect changes that are probably
01:22:00
you know hard for a human to see so they think they can get to like better than human sort of diagnosis by
01:22:08
using computer vision and then we invested in sort of after that where we realized
01:22:14
okay this is kind of like a powerful application so we invested in a company called Robo flow which creates tools for
01:22:21
computer vision so Pearl created its own tools for taking a large number of you know X-rays and classifying them and
01:22:30
then creating their own AI tools roboflow gives you that same tool set but you can run it on any computer
01:22:37
vision project and they seem to be building a pretty big universe of software developers who are using their
01:22:43
tools and in this case this was a team that was bought they bought a 250 person team for 600 million dollars that just
01:22:48
had this capability set really and a toolkit does that change your outlook for investing in mlai companies when you
01:22:55
see a 600 million dollar exit for effectively a capability they didn't have you know a core product that was in
01:23:01
Market they were doing kind of these co-development deals but I mean how much does this
01:23:06
already yeah ai's already the hot thing and everyone's kind of looking at this now I don't know like you know ever want
01:23:13
to base an investment decision on the fact that some acquirer might come in and buy you for a large amount of money
01:23:20
when you have no revenue or business model I just think like that's not really a
01:23:25
sustainable although it does seem that AI Engineers go for 2 million each I think is kind of your point Dave on an m
01:23:33
a basis yeah I mean your Deep Mind got bought for what 600 by Google and I think they had 200 people I think it was
01:23:39
like 400 yeah it was like was it 400 yeah so yeah it does seem like and I think deepmind
01:23:44
did not have a business Concept in mind when they were funded they just wanted to do research right that was kind of
01:23:50
thing about that company platform capability similar to instant deep I mean there's a lot of these that's what
01:23:55
I'm pointing out is like some of these platform capabilities end up just getting fought for
01:24:00
you know huge Psalms yeah the amount you can't invest in a company hoping for an unreasonable acquisition
01:24:09
meaning unreasonable meaning that unreasonable acquire yeah yeah like unreasonable meaning that your own
01:24:15
metrics don't reflect that valuation as a business you might be worth it as a strategic acquisition of somebody else
01:24:22
but you you actually raise interesting question which is is a seat model the right way for one of these companies to
01:24:30
price the product and you may be right that that the seat license model doesn't really work because
01:24:35
like how many seats do you really need to buy for these companies look I mean one of my like one product engineer yeah
01:24:40
like I mean we've seen this we've even seen we've had these debates inside the companies I mentioned where like you
01:24:48
know charging a 10 or even 100 a month seat doesn't doesn't really reflect the value of the insights that are being
01:24:55
created and so yeah there are like you know they're I don't think this has been figured out yet but this is the big
01:25:01
question in ml and AI when I was at Monsanto you know we had all this IP licensing deals we do or um new products
01:25:07
would come to Market and it was never Cost Plus or simple pricing it was always about value capture it's in an
01:25:13
Enterprise setting you know because we sold to Farmers it's like how much value Are you delivering for the farmers if
01:25:17
it's a hundred dollars a profit an acre you try and charge an incremental thirty
01:25:20
dollars an acre for that product and it was always a one-third value capture model and the same is true in biotech
01:25:26
and Pharma the producer of the product or the co-developer of the product is often front of value capture and it's
01:25:32
not a site seat license and it's not a service fee it's more ultimately we want to get a royalty on the outcome on the
01:25:37
Improvement that we can deliver to you and so there's all these novel business models that are emerging at least that
01:25:42
I'm seeing in Pharma and biotech to participate more meaningfully ultimately in the drug development outcome versus
01:25:47
just getting charged a fee for doing a service or a fee for a license to a software packet the value of these
01:25:52
companies has gone down I was a early investor series a investor in a company called Flatiron Health we sold it for
01:25:59
1.9 billion dollars to Roche that's the biggest exit in this space for this machine learning enabled stuff it
01:26:05
happened in 2018 and so what's really happened is the value of acquisition in M A has gone
01:26:09
down even as a technology capability has gone way way up and why is that it's because this stuff has yet to be proven
01:26:17
to actually meaningfully improve the hit rate for these drug companies so whether
01:26:22
it's biotech or Roche or anybody else the biggest problem we still have is getting the design space
01:26:30
guessing that better and these machines are better at doing raw calculations but
01:26:35
they're not necessarily better at veering towards this design space over this design space and so as a result
01:26:40
you're not improving the the either the slugging percentage or the batting average of these Pharma companies and
01:26:49
that's why they're paying less and less so everybody will have this capability as an adjunct
01:26:53
the thing that you have to do is sort of what what you guys have said which is if
01:27:00
there's a company that can actually do better guessing at the top of the funnel the thing that you should probably do is
01:27:06
just give it away in return for a back-end rev share and a royalty and that business also exists so you know
01:27:12
the best performing company in Pharma is a company called royalty Pharma it's a 22.5 billion dollar company that has 90
01:27:18
ebitda margins it exists in Ireland it's run in New York by this wonderful entrepreneur Pablo lagaretta but that's
01:27:25
what he does he buys small pieces of royalties and his whole thing is like the Paul Graham thing at YC
01:27:32
I'll give you just that little amount of support and all you need is a little lift in valuation to justify giving me
01:27:38
the six percent and the tooling company the AI company that does that could win who would go to
01:27:45
Roche and buy on Tech or lily or somebody else and just say look use my tools and whatever drug you generate off
01:27:52
of me I just want a three percent royalty and all you need to do is just show a three
01:27:57
percent lift across a portfolio of assets that would be a killer business model because if you look at what
01:28:02
Pablo's done over a large number of successes that's a ginormous company Jacob I mean are you investing in the
01:28:11
seed stage mlai companies and are there novel business models that you're seeing
01:28:15
we're not sensors yet to be honest we are seeing people play with chat GPT and kind of
01:28:22
do you know experiments but you know the more I've used chat GPT we've connected it to our
01:28:31
slack so you can actually ask a question in our slack in a channel called AI testing and it will give the answer and
01:28:39
everybody can see people like playing with it he you know it's kind of like a parlor trick
01:28:45
now I'm in like that phase where I'm like yeah this is impressive but it didn't actually solve my problem
01:28:52
and it's slightly faster than doing a Google search so I am thinking there's going to be
01:29:00
a really good business uh created in taking the open source projects and forking
01:29:07
them and verticalizing them like you know saxes one that's doing dental work you know
01:29:12
like this makes sense to me somebody should do it in accounting somebody should learn all of Gap accounting which
01:29:18
is pretty simple because it's published fasbi all of this nonsensical accounting
01:29:22
rules and give you a hundred percent guarantee of no malfeasance so for example you guys saw this Brazilian
01:29:29
company you want AI accounting that's your that's your look at this company Logistics
01:29:36
look at this company americanas in Brazil which just torched 20 billion dollars of Enterprise Value why because
01:29:42
these guys were using Excel to do a bunch of complicated capitalization and cost accounting made two or three years
01:29:50
of mistakes it added up to two or three billion dollars and they're basically going to file bankruptcy in the next few
01:29:56
days that's completely avoidable human error that should never happen and an AI would be perfect for that like
01:30:05
this is not super controversial to just follow Gap accounting right yeah I don't
01:30:10
know if you need AI for that I think you just need software like a database would
01:30:14
be good but no the problem is the database exists today like everybody sits on top of Oracle GL or workday it
01:30:20
doesn't prevent these errors so my point is you got to get humans out of the system and the AI should be the
01:30:25
accountant the AI knows the rules generates the p l and says this is it and by the way
01:30:31
that's way better risk management for the CEO and the CFO because as you guys know if you're the CEO of a public
01:30:36
company you have to sign your signature that these things are legitimate and how do
01:30:41
you know right I would way better know that a computer did it like an open AI algorithm tells me Tremont this p l is
01:30:46
perfect then some dude I don't know at Ernst Young okay I have a question for socks
01:30:54
saxypoo can you please explain to me why Alec Baldwin is going to get charged with manslaughter for this rust thing
01:31:00
that seems really crazy can you just say could you explain what happens on a set
01:31:04
with guns and how the hell did this happen like what the hell is going on well I've produced two movies but
01:31:09
neither one of them involved you know guns or shootouts or anything like that so I haven't had like first-hand
01:31:14
experience with this I have you're a gun owner so you're an intersection of movie
01:31:18
producer and gun owner so it's a good yeah I understand the rules of gun safety and and that kind of stuff
01:31:23
look Alec Baldwin did not follow the rules of gun safety the first thing I would do if I was ever handed a gun
01:31:30
would be to clear it I'd like check to see if it was loaded and clear it I mean you never pointed at you at
01:31:37
somebody you always treat a gun as if it's loaded even if you think it's not but he was in a very specific situation
01:31:43
which is he's on a movie set and the person who's handing him the gun is the armorer and someone whose job it is and
01:31:50
said Colt gun yeah exactly it's somebody whose job it is to make sure that the gun is handled properly and unloaded and
01:31:57
all that kind of stuff and they're using it on a set so I agree with you I don't
01:32:02
quite understand why Alec Baldwin is liable in that situation for the gun going off the person who screwed up here
01:32:11
the person who screwed up is the armor the armor I have a question a person whose job it was to never allow live
01:32:16
ammunition on the set but to handle the guns properly this person movies was that they were flying blanks
01:32:24
yeah they were so you're in blanks but they had blanks and regular ones in their kit for whatever reason because
01:32:32
they were shooting real ones as well but this is involuntary manslaughter and I think Baldwin is also the producer of
01:32:39
the film so I don't know it has to do with his hiring of the armorer you know what I'm saying that I can that I can
01:32:46
speak to listen yeah you you frequently give stars in an independent movie a producer title he's not responsible for
01:32:54
the physical production of the movie I bet anything he's not there's a guy called the line producer who's
01:32:59
responsible for the physical production and my guess is he wasn't even responsible for the business side of the
01:33:04
production they've got other producers for that so it doesn't make sense to me if they're going to charge him for
01:33:10
having some sort of overall liability as a producer to then not charge the other
01:33:13
producers that just doesn't make any sense so I think this producer credit thing's probably a red herring like I
01:33:19
said I think the armorer is the person who is seriously responsible for this situation there are the ones who screwed
01:33:25
up they're the ones who had a responsibility to make sure that the gun handed to an actor I mean Alec Baldwin's
01:33:31
an actor yeah look conservatives in social media are dragging the guy because they think he's a douchebag and
01:33:36
he doesn't know how to handle guns but that's not his job he doesn't he's asking questions
01:33:41
in movies why would you ever have live ammunition on a movie set you shouldn't they shouldn't have you shouldn't it's a
01:33:48
mistake so so it's not as if like the scene is different if you have a real Bullet versus a blank
01:33:56
if I remember right there was a story about how the gun Armory people were taking members of the cast and crew and
01:34:05
they were shooting guns for fun in the distance they were doing like targets and messing
01:34:11
around and teaching people gun stuff and just playing around but using live ammunition and that that led into an
01:34:16
accident that there wasn't good kind of transition that's really bad that sounds
01:34:20
like the kind of negligence that caused this but unless there are facts we don't
01:34:24
know about I don't know why being charged by the way the armor that sounds totally legit to
01:34:33
me so guys listen I need to run another call I was going to talk about this really fantastic paper on the one of the
01:34:44
driving forces of Aging as demonstrated by a team from Harvard in in collaboration with many others
01:34:51
on epigenetics and the loss of data integrity and epigenetics really being the core driver of Aging in mammalian
01:34:58
cells it's an incredible paper it speaks a lot to what we talked about last year
01:35:02
yamanaka factors and partial epigenetic reprogramming of cells how they can reverse aging these guys have
01:35:07
demonstrated it in a really powerful way I'd love to spend some time on it maybe
01:35:11
we pump that science corner to next week wrap up for today I think we've talked about all sorts of fun stuff it's been a
01:35:17
real pleasure and an honor to be in the seat of the world's greatest moderator we missed him today we honor him we look
01:35:24
forward to having his return next week chatting with you gentlemen and on behalf of the all-in Pod and my
01:35:32
co-hostia David sacks Jason callicanus thank you for listening bye bye love you boys
01:35:41
your Winner's ride rain man [Music] we open source it to the fans and they've just gone crazy
01:35:51
[Music] besties [Music] we need to get Mercies [Music]