00:00:00
all right everybody welcome back it's another episode of Allin podcast the podcast that is racing up the charts
00:00:06
despite the fact that we recorded every three or four weeks there's no marketing there's no ads in this podcast it's just
00:00:11
four friends who play poker together who've decided to talk about the most important issues in the world welcome
00:00:18
back to the podcast David fredberg the queen of quinoa uh himself uh obviously
00:00:24
climate.com Itza and uh an undisclosed beverage startup that I'm not supposed
00:00:31
to talk about sorry about that I know a lot of people were tweeting about this beverage startup you're still not ready to talk about the beverage startup thank
00:00:36
you j y welcome back to the show I always appreciate your promotions uh but when when will the
00:00:43
beverage start by the way do you guys want to talk about do you guys want to talk about Jason's home address because I have that I think please
00:00:49
no I want to ask uh is is that a picture in the background I love space by the
00:00:54
way as you know but is that a picture of Uranus or what is that picture I think that's Saturn it's Saturn
00:01:01
it's Saturn it's Saturn it's no it's Saturn uh freeberg obviously taking the first
00:01:08
Virgin Galactic flight uh chamath poopaa of course with us here the um Prince of
00:01:15
spax calling in from an undisclosed location that is not burning down like
00:01:21
the United States how you doing on your vacay uh doing really well thanks than I'm giving you the three button salute
00:01:26
as I told you yeah thank God the microphone is perfectly positioned so we do not have to look at your chest hair
00:01:31
all six of your chest hairs oh my God it's like a $1,000 suit that's missing
00:01:37
all of its buttons or shirt rather I mean they couldn't afford to put buttons all the way up on your like probably
00:01:44
$2,000 shirt aity meas when I get back to the United States as Jason said my habit Dasher will meet me at PL side and
00:01:51
slow the three buttons yeah when he when he leaves for Europe they remove the three buttons he comes back the Habit
00:01:56
Dasher puts them back on each shirt uh he does that for the entire work wardrobe and of course chiming in is
00:02:02
Rainman himself David Sachs blo professional blogger and the fund
00:02:07
manager of craft ventures of course uh before that working at PayPal with uh
00:02:12
Peter teal Elon Musk and a bunch of other famous people um uh two of which
00:02:19
have gone on to have demonstrably more success than saaks but uh saaks having
00:02:24
of course more than success Dem monal success than the other 72 rocket scientists from PayPal in between he did
00:02:31
a little company called Yammer which Microsoft bought for a billion dollars speaking of um big companies in big Tech
00:02:39
we had a big Tech hearing this week and Jeff Bezos Sundar and uh Zuck
00:02:47
himself as well as Tim Cook two Founders and two Hired Guns uh people who are
00:02:54
hired for their positions defending themselves from what I thought was some pretty good questioning um my my
00:03:00
expectations were very low that anybody on that panel would know what they were talking about for me I thought Jeff
00:03:06
Bezos did the best job he had a great opening statement and he was the most candid um and I think least likely to
00:03:13
get broken up going around the horn here chamath who did the best job in the hearings I don't know if you saw all of
00:03:19
them are just Clips but who do you think shined I uh I only saw to be honest with
00:03:25
you your recap which I thought was frankly really really good um when we should we should link to that in the
00:03:30
show notes so people can listen to it um I saw a couple of answers um the the
00:03:38
thing that jumped off the page to me was I I read a little bit of bezos's statement I thought it was pretty fire I
00:03:44
thought he did the best job um kind of positioning himself but the reality is you know it's kind of what I said a few
00:03:50
days earlier on CNBC but I just thought going in this whole thing was set up to be kind of performative theater and it
00:03:55
basically was that you know the the just like the level of questions are just so poor the level of understanding is so
00:04:02
bad and then you know people just use it as a way to grandstand and uh everybody did um so you know I wasn't uh
00:04:09
completely blown away by any of it to be quite honest uh what do you think freedberg
00:04:14
who had the best showing um in those hearings uh I think Zuck was uh the most
00:04:21
kind of eloquent in the uh on point responses he was uh super super well
00:04:28
prepped for this thing um I think Bezos and and others um were obviously uh um
00:04:34
you know they had they had great kind of prep work done for their statement but in terms of like warning off the attacks
00:04:40
I think Zuck did did a great job um you know it was weird it didn't feel like uh
00:04:45
like Tim Cook should have been there it was like kind of a random thing that he was there because everyone had an axe to
00:04:51
grind and the axe that everyone had to grind was a little bit different it wasn't like this was a a true objective
00:04:58
discussion about you know antitrust and so the the acts that people had to grind
00:05:03
were kind of pointed at Google and Facebook and Amazon and different ways uh Tim Cook was kind of you know
00:05:10
hey yeah this is cool you guys go ahead and give your responses I'm gonna go back to I think that's because apple
00:05:17
does not have a monopoly position on a on a numbers basis in any one era and or
00:05:23
and Andor because their products are so loved and universally you know used I I
00:05:30
think it's actually a function of what these companies do so if you look at the the Jim Jordan rant I don't know if you
00:05:36
guys watch this but Jim Jordan did this big rant at the open and he went on and on and the first thing he said he's like
00:05:42
big Tech is out to get conservatives and then he went on and gave all these examples about how Twitter has been pulling down Donald Trump's tweets and
00:05:48
flagging them and Facebook's been been you know canceling certain people on the platform and his whole act to grind was
00:05:55
really about censorship on social media platforms which has [ __ ] nothing to do with antitrust and has nothing to do
00:06:00
with Apple's business um and so yeah I guess my point is like and then other people have issues with with the with
00:06:06
Google's dominance and ads and Amazon's impact on local business and so there there wasn't much of an ax to grind
00:06:13
frankly with Apple at the end of the day as I said I just don't think that it was a function of you know a true kind of
00:06:19
objective Anti-Trust approach and it was just more about like hey we've all got different things we want to address and we finally got these guys here let's
00:06:25
beat them up and you know saaks what do you think with freedberg that it performance art or do you think that or
00:06:32
performative rather do or do you think that there are actually substantive issues that came up during the hearings that we should discuss here well you
00:06:39
know it was both um you know certainly there was a tremendous amount of grand
00:06:44
standing and political theater and um the the politicians on both sides wanted
00:06:50
to take shots at at the companies for various reasons I mean I think they have a slightly different hierarchy of hate I
00:06:56
think the um the the left sort of hates Facebook the most because they blame it
00:07:02
for um Trump's election which I think is kind of a a ridiculous scapegoating uh
00:07:08
which we should talk more about but um and then I think the right is is most suspicious towards uh Google um but I
00:07:15
think there are you know legitimate issues here as um that were brought up and I I think the Congressional hearing
00:07:22
did score some hit points um and I think your your previous po did a good job showing some of those um the the these
00:07:29
hearings were teed up apparently over the past year by um a series of subpoenas of records that the the
00:07:36
committee this is the uh this is the um house uh
00:07:41
subcommittee on antitrust had teed up and so there were some moments where I
00:07:46
thought that um you know the the representative scored some hits on you know Facebook and Google um what do you
00:07:53
think the big who took the biggest hit in all of this who who who do you think has the most putting aside all this
00:08:00
performance obviously and the politization of everything in our country and Jim Jordan who to me is like
00:08:07
the he's like the dad at the baseball game who like the little league like game who runs on the court and pushes the Empire and gets banned for the
00:08:13
season like he just yells over everybody um for no reason but what is the actual
00:08:19
what was the punch that landed that is the most valid as we go around the horn one more time here now that we got our
00:08:25
initial thoughts about it what punch landed the squarest in one of these companies
00:08:31
faces well I I I let me me set this up I I think there were three big areas of
00:08:37
concern where just about all the companies with maybe the exception of Amazon took hits although even you know
00:08:42
Bezos took hits I think one is um with respect to anti-competitive actions that
00:08:47
these platforms are taking particularly with respect to the applications or small businesses that operate and are
00:08:53
dependent on those platforms I think all of the companies were interrogated about that um you know Bezos took a hit when
00:09:00
he had to admit or concede that the company may not have always followed its policy with respect to using its uh you
00:09:08
know third party sellers data to to figure out how to compete with them uh you know Google was interrogated about
00:09:14
Snippets um there was news today actually just out of Australia that the government's going to order Google to
00:09:19
pay small businesses for the use of its its content uh for Snippets which you
00:09:25
know so so the you the regulations are kind of heating up on this but the the sort of the first uh area was sort of
00:09:31
anti-competitive and I think Facebook took some some hits with respect to the Instagram acquisition um which uh you
00:09:38
know uh Congressman Nadler really went after him and then I think um uh jaia
00:09:44
pow is as well uh and that that's a tremendously threatening issue for
00:09:50
Facebook because if it is forced to divest Instagram it would just be crippling for for the company we talk
00:09:55
more about that yeah let's take just just Jason just set the table two other issues that I think came up I'll just
00:10:01
very briefly the uh number two is sort of cozying up to China I think Google is
00:10:06
the one that's most vulnerable here and then the third issue is sort of this issue of censorship and bias uh with
00:10:12
respect to content and politics in the election nothing to do with which has nothing to do with antitrust the
00:10:18
censorship issue so let's table that one I think you're hitting the nail on the head this was not about antitrust going
00:10:24
in I think people were you know kind of confused even Jim Jordan just I don't think he has any clue what he's talking
00:10:30
about he doesn't know the difference between regulation and antitrust he doesn't know the difference between the Sherman Act and like you know section
00:10:37
230 I think they're all kind of making it up as they go along so in many ways I
00:10:42
think personally that the companies that were the most at risk going in were the same companies at risk coming out and so
00:10:50
you know if you had to stack rank the risk I think Facebook is number one at the top of the list then I think it's
00:10:56
Google then I think it's Apple and then I think far far far down is Amazon in
00:11:02
many ways Amazon is the most inoculated simply because the End Market that they
00:11:07
operate in is so massive um and the the market that Facebook operates in is so
00:11:15
new yet so constrained with very few competitors so in many ways I think that's how the risk Cuts I really think
00:11:22
that the Anti-Trust legislative framework that exists today isn't enough to touch any of these guys instead I
00:11:27
think what really happens is more regul at um and if you really think about what these guys are very concerned about it's
00:11:33
more that Facebook largely and then Google to a smaller degree essentially
00:11:39
can be king makers with respect to popular opinion and sentiment and I think that they want to have regulations
00:11:45
and I think that there's a good historical precedent for a bunch of Industries um that have had to come under regulation when they effectively
00:11:52
get to 100% distribution you know whether it's meat or airplanes or radio
00:11:58
or television you know agriculture RIT large um uh Automobiles and
00:12:03
transportation whenever a market basically serves 100% of the total of
00:12:09
addressable Universe governments step in and they don't necessarily legislate and
00:12:15
Trust bust they fundamentally regulate and tax and I think in many ways that's
00:12:20
just as bad and frankly in some ways it's worse because if you do that to a tech company you're basically crippling
00:12:26
the one thing that they're supposed to be very good at which is to and that's the only thing that they can use to
00:12:31
basically keep their stock price High which is then the only thing that they can use to get people to continue to work for them so that's the sort of
00:12:37
circular Loop that breaks if you regulate them and I think that the risk coming in was the same as coming up so
00:12:43
Facebook let's let's take them let's take them one at a time Facebook I thought had the worst performance
00:12:49
because it was pretty clear that Nadler was setting them up not only to not be able to buy a company in the future but
00:12:55
In that clip he was sort of teeing them up that maybe the Instagram uh acquisition should be unwind and they
00:13:01
should be forced to spin that off uh because they were saying over and over
00:13:07
and over again that Zuckerberg put in emails uh with his management team that
00:13:13
they were going to buy these companies or kill them or copy their feature sets and even though that may not be
00:13:19
explicitly illegal the fact that they've hit as chth is talking about such
00:13:24
incredible market share with billions of users and because of the track record of Zuckerberg you know which may not be at
00:13:31
all related to this but it sets the table no but Jus Jason In fairness Dem Mark that decision wasn't made when
00:13:38
Facebook had market dominance um that decision was made when Facebook was still fundamentally at risk and there
00:13:44
was a large period of time where a lot of other people had they been left to their own devices or properly
00:13:49
capitalized could have actually become a relatively you know important competitor to Facebook Instagram could have been at
00:13:56
that point but then Snapchat was the opposite Snapchat they were at scale and then they were going to buy it and threaten them either you sell to us or
00:14:03
we're going to copy the features I think I think I think what a more logical and defensible reaction like I I just think
00:14:10
it's not defensible to say oh you know what Facebook I didn't like the acquisition you did 10 years ago
00:14:15
basically because it worked and so I'm going to punish you 10 years later that's crazy that's stupid yeah in the
00:14:21
review mirror no no good yeah a more reasonable place to be is to say okay this thing meaning Communications large
00:14:29
has become a critical piece of societal infrastructure and we are trying to figure out now what the rules should be
00:14:35
and rules shouldn't be brittle rules should be evolutionary they should map you know to the moral decisions and
00:14:41
ideas and Frameworks of the time and so you know uh we have to figure out for
00:14:46
example number one interoperability so how can you message across all these multiple networks you know another
00:14:53
simple example uh you know we legislated the ability for emergency services to be
00:14:58
able to send a message on your mobile phone line and your landline you should probably be able to have a back door
00:15:04
into all the messaging Network simply for that reason so the point is that you know there are all kinds of things you
00:15:09
can do today to make this infrastructure layer of
00:15:15
society operate in a more predictable way on behalf of what was your best you have you thought about a regulation then
00:15:21
let's stick to Facebook and then we'll go to Amazon chath have you thought about a regulation that would make sense
00:15:27
to Facebook whether it's divesting an asset or maybe a certain percentage of
00:15:33
usage or allowing Facebook Messenger to work with iMessenger to work with you
00:15:38
know Twitter DMS I'll answer it in a different way so look I mean for 20 years I've run these kind of businesses
00:15:44
like from from Winamp to aim and icq to then you know at Facebook and so um you
00:15:49
know I remember at aim and icq we you know uh did all this hand ringing and
00:15:55
all these meetings between us and Microsoft and Yahoo to to make our messaging networks interoperate and you
00:16:01
know eventually we were basically just cut off at the knees because other people just moved around us and
00:16:08
eventually it all just morphed anyways away from uh these sort of brittle
00:16:13
messaging networks my my kind of view is that I don't I I think what's best for Facebook is a status quo and so you know
00:16:20
uh if if if if they can basically and by the way I think the strategy is and and Mark wrote this in his Manifesto but a
00:16:26
couple of years ago you know this is sort of what led to Chris Cox resigning if I'm playing you know sort of like
00:16:32
conspiracy theorist if you read zuck's Manifesto what he was basically saying is listen we're going to take all these
00:16:37
product and we're going to take all that code and we're going to mesh them all together in such a complicated
00:16:44
convoluted mess that if and when somebody ever tells us to rip it apart it'll take another 5 or 10 years to do
00:16:49
it and that's effectively the technical read on that Manifesto It's just like you're going to make it technically
00:16:54
impossible to uh unthread these things as inde and your thesis is that's a strategy
00:17:01
against an Anti-Trust breakup I I I I find that no I just think it's a really smart strategy I mean he wrote it and he
00:17:08
published it online so it's not like he's hiding anything he made it I mean this is the beautiful part about it he made it completely in the clear now uh
00:17:16
so that's that's the strategy is to basically make it one monolithic code base so that if and when I think I don't
00:17:22
I'm not sure if this is the intention but frankly if and when somebody knocked on the door and said hey you need to strip apart what and messenger and
00:17:30
Instagram you can say well look it's it's one monolithic code base of you know 50 million lines of code it'll take
00:17:35
me 10 years but sure I'll figure it out somehow so yeah you know I think what's good for Facebook is a status quo now
00:17:41
that's different from what's good for politicians and then what's different for um consumers I think what's good for
00:17:49
consumers is fundamental interoperability now this is then what touches you know Android and uh apple as
00:17:55
well like the IDE idea today that you can not have a group text message that can only include iPhones you know on the
00:18:03
off chance one of your friends is an Android phone you're basically [ __ ] is kind of which happens every six months on our group that freeberg what do you
00:18:10
think uh in terms of Facebook and any potential action that could be
00:18:16
taken or any possible solution to them having such a dominant position because they are the only one of the four that
00:18:21
has a dominant position I would think about the um
00:18:29
you know how these businesses are kind of built right there in all these businesses there's an infrastructure
00:18:35
layer the infrastructure layer in the case of Google and Facebook is is is
00:18:41
reasonably similar it's a bunch of data centers and and hardware and software infrastructure to run all of their
00:18:46
services on top and then on top there are uh consumer products and then there
00:18:53
are advertising products and the and the customer base for the consumer product is obviously users and the you know
00:18:59
customer base for the advertising products is these advertisers that pay to access these consumers and give them
00:19:04
ads and get clicks from them and sell them stuff um and so if you think about what do you pull out um it it sounds
00:19:12
like on the Google side there's um there's there's concern both on the advertising and on the consumer products
00:19:18
that are being offered and the scale and The Leverage that Google has and how they make those products kind of come to
00:19:24
Market um and with Facebook it's really about this absolute kind of Monopoly on
00:19:30
um you know on social products and services whereas Google's got this great Monopoly on on search products for
00:19:35
consumers so um you could kind of take a Layman's view and say hey like rip out
00:19:41
WhatsApp and rip out um uh Instagram and you know then Facebook is good but the
00:19:46
problem is in that infrastructure layer they've created this social graph and this connection between you know all the
00:19:52
people that you know and they've got all the stuff sitting on the same servers and chth points out all the same codebase and there's a lot of
00:19:57
commonality there so the reality of like ripping something out from there is a
00:20:02
lot more nuanced and a lot more challenging than just saying hey you got to get rid of WhatsApp or you've got to get rid of Instagram um and it's more
00:20:09
likely some sort of Chinese wall situation where you end up with a uh a negotiated exit continued ownership and
00:20:16
control but you know almost like what happened with the banks in the 80s you kind of got to separate um one side of
00:20:22
the business from the other that could be one way that this goes because you know it's really hard to kind of break apart given the way that these
00:20:28
businesses are built what do you think about a solution uh David in which uh
00:20:33
they conceded hey we're not going to buy any more of these uh competing social
00:20:38
networks which I think it would be kind of hard for them to buy one right now I think that's done I mean like you can even see that Google Fitbit I mean
00:20:45
Fitbit is you know what is it a 1.2 or3 billion do acquisition it's going to take almost two years to close and
00:20:51
Google's already making concessions antitrust concessions to the EU for you know this is A1 trillion doll company
00:20:57
trying to by a$1 billion company so I think large acquisition in m&a uh by the
00:21:03
big four uh it's impossible is that good for society chath or bad for society is it good for our business of investing in
00:21:10
startups or is it bad for us investing in startups well I I think it's good in one very important way which is that it
00:21:16
forces the capital markets to support uh these companies and what I mean by that is you know I I I've told you guys a
00:21:23
couple times but in the year 2000 there was 8,000 public companies in the year
00:21:28
2020 July 2020 as we sit there August 2020 there's about 4,000 so we've seen a
00:21:34
shrinking of 50% of the number of public companies so the idea that there isn't
00:21:40
an m&a onramp anymore means that more capital and the capital markets will
00:21:46
become more fluid and we will support emerging growth companies in the public markets is my suspicion if only there
00:21:52
was yeah if only there was an easy way for these companies to get public go ahead David respond well I I was I mean
00:21:58
I I think that um I I think you're raising the right issue which is um the chilling effect on m& that these
00:22:06
hearings are going to have um even if Facebook is never broken up or or that
00:22:11
deal is sort of retroactively challenged um the the the big four tech companies
00:22:16
have to be looking at these hearings and now they're going to be second guessing every acquisition they want to make and
00:22:22
it's going to have a chilling effect and I I think that's a disaster for Silicon Valley um because we know that most of
00:22:28
the startups don't work um and you know uh and there's really only you know most
00:22:33
of them go out of business and there's only two good exits one is an IPO the other is m&a and if you take the m&a
00:22:41
exit off the table because it's no longer sort of feasible from a regulatory standpoint um not all those
00:22:47
companies are going to IPO yeah but David what what you're saying doesn't make logical sense because if those
00:22:52
companies are [ __ ] anyway they should be going out of business and who cares about an aqua hire or some Mini modest
00:22:58
hire that gets you two times your money there's a lot of of uh Acquisitions um
00:23:04
where the acquirer is picking them up because they provide an important component or technology or product but
00:23:09
that that that startup would not have been a great Standalone public company would y would Yammer be worth more today
00:23:16
and would you be worth more money would your investors be worth more money if Yammer had spaed yes or no
00:23:21
David um I is absolutely yes okay so David your your argument makes no sense
00:23:27
I think you're to lose it's not that it doesn't make sense I think D David does bring up something that's important in
00:23:32
the following way which is there's a lot of companies Jason that get to a certain amount of scale and then they basically
00:23:39
start running out of oxygen whether it's because they've overbuilt or they've over hired or they've overspent orever
00:23:45
where there's a natural audience for the product yeah maybe but I think I think a lot of it is just sort of more
00:23:50
overbuilding and just kind of distracted Capital allocation but then you know you
00:23:55
need somebody to come in and this is the problem with Silicon Valley and I think what David speaks to is the following if
00:24:02
big Tech m&a is off the table the single biggest thing that'll change is valuations by late stage private by late
00:24:09
stage privates because if you know that you can't get a 2X Mark to Market from
00:24:14
the last post guess what'll happen to your post money it'll go way down right because that was always the understood
00:24:20
assumption you know All These Guys these late stage money can come in and say well sure I'll put you know $2.5 billion
00:24:26
post a$3 billion most because in their mind what they've been taught is that
00:24:31
immediately sets the mark to get acquired as 2X and in many ways Facebook started it because Facebook came to buy
00:24:38
Instagram literally weeks after that growth stage round at 500 million that's why they paid a billion one they doubl
00:24:44
the valuation but wouldn't it hold on a second wouldn't it be healthier though for the entire ecosystem if we weren't
00:24:50
building those late stage companies uh to be flipped to a major company maybe
00:24:55
merging them with mediumsized compan are slightly stronger and then taking them public to your point Jam my point is if
00:25:02
you don't have a [ __ ] up cap table you can do all of those things it's the [ __ ] up capap T this soles that who
00:25:07
needs this late stage Capital coming in and doing these fkaka crazy rounds why not take the company's public earlier
00:25:14
well because look uh you don't always know what's going to happen I mean this is the reason why Instagram sold it's
00:25:20
the reason Yammer sold is you don't know exactly what's going to happen you don't know what the outcome's going to be and in a lot of those cases that you're
00:25:26
saying would would become IPOs uh if they weren't acquired well a lot of them
00:25:32
just you know aren't going to work it's it's crazy to be taking those exits off the table when both the startup and you
00:25:39
know the acquire or the big tech company you know want to do the do the transaction um and and and and and one
00:25:44
of the reasons why I think these you know there are a lot of these m&a type outcomes is because big companies have
00:25:51
realized they not very good at R&D at sort of good at sort of new product development and so what they've done is
00:25:57
they've outsourced a lot of their R&D budgets to m&a and so they let the startups run the experiments you know in
00:26:04
any category uh in any new area you end up having a dozen of these startups get
00:26:09
funded you know we we make fun of it because they're all you know there's so many competitors in every little space
00:26:15
but those startups are the laboratory where all these experiments are taking place and then you know the big company
00:26:20
comes in at the end and sees which experiment well acquire it free what do you think I think it's I mean I think
00:26:25
the advantage of being a platform business is you can plug something in and immediately gain a lot of scale from
00:26:31
it so I mean you know Instagram and YouTube are perfect examples they were
00:26:37
um you know reasonably fast growing had millions of users um but once they were
00:26:42
plugged in to the engine of the bigger platform they were worth a hundred times as much uh over a few years uh because
00:26:49
of all the usage and the infrastructure and the and the distribution Etc that was provided um but you know it looked
00:26:56
insane at the time time to pay a billion dollars and a billion six for those two businesses each of them are easily worth
00:27:03
100 billion plus today probably some multiple of that um and so I think it's uh Sax's point is right is like I'd
00:27:10
rather as a look I worked in m&a at Google uh for a couple of years early in
00:27:15
my career I left Google in um in 2006 and a lot of the um infrastructure that
00:27:21
makes Google's um you know Revenue engine was acquired you know we bought a company called applied semantics for1
00:27:27
million bucks or hundred something million dollars at the time um which ultimately became AdSense and applied
00:27:34
semantics could scan a web page um and basically determine what keywords that web page represented and then match ads
00:27:40
from AdWords onto that that web page that acquisition was $100 million I mean I don't track anymore how much but tens
00:27:47
of billions of dollars of Revenue are generated by that uh uh you know by that AdSense system today you're bringing up
00:27:53
something really important which is at the time Google was not a trillion company so the point is that Google had
00:28:00
access to enough Capital Market scale where you know nobody's going to get in the way of a 5 10 20 billion do company
00:28:09
trying to buy a hundred million business like that I just don't think you're going to see you know any regulatory
00:28:14
body take that seriously wait so didn't we just paint the perfect picture there be a trickle down wait wait isn't that
00:28:19
the perfect picture in fact I think what it means is the $2 billion company now probabilistically can actually you win
00:28:24
so for example like look at this uh intu it credit Karma transaction right the question is you know could a smaller
00:28:31
company have bought Credit Karma probably but not at the price that you know Inuit is willing to pay now if in
00:28:38
gets big enough where there's a chilling effect and Regulators say okay you know you're above a magic threshold and you
00:28:44
know no bueno on the m&a anymore now Credit Karma has two choices which is maybe they sell for 4 billion to a very
00:28:50
different company right um or maybe they sell actually let's take a different example PayPal PayPal is now a top 20
00:28:56
business in America right by market cap so if PayPal isn't allowed for example
00:29:02
to buy uh you know a bunch of sort of like you know payment rail payment
00:29:07
companies um maybe what happens is like a you know a medium tier business is allowed to buy them and now all of a
00:29:13
sudden those medum TI businesses can compete with PayPal that's what I think that that actually seems like the best solution that we' we've kind of stumbled
00:29:20
on here can't slack then become or Dropbox or Uber or any Airbnb now they
00:29:26
can become the acquires these companies and then they can compete so why don't we just say hey if you're over a trillion dollars or if you're over 500
00:29:32
billion you can buy 1% of your market cap I'm just throwing a number out here Jason let me jump in on this the the
00:29:39
that's not what uh Nadler was arguing for you know it's not like Nadler was saying that if you're a big fork tech
00:29:46
company you can't do these deals but everyone else can the the the the standard that that Nadler and the
00:29:52
precedent that he was essentially setting in that hearing is you know 2020
00:29:58
hindsight bias you know if if a company acquires um yeah putting I agree with
00:30:04
you on that but putting that aside if we were going to come up with a rule because we know the rules that as they currently exist are inadequate to do any
00:30:12
type of regulation for these companies because none of them have 95% market share so if in fact uh we we need a new
00:30:20
solution how about this for a solution I'm just putting it out here you can acquire something that is under 5% of
00:30:26
your market cap so if your market cap over the last year is a billion you can buy something 50 billion or less if
00:30:32
you're uh under 5 if you're under 250 billion you could buy whatever the hell you want but J let me let me let me ask
00:30:39
this question you know the points we made earlier about YouTube and Instagram they were successful because of the
00:30:45
scale of the user base of the platforms that acquired them and the work that had already been done and so they could plug
00:30:50
in both been totally successful without they would have been success but would they have been worth $300 billion like they are today unar but Instagram was 13
00:30:58
people YouTube was a couple dozen people it doesn't matter the story is a small group were brought in with with an
00:31:04
interesting platform that was kind of working at the time and then they became these $300 billion platforms so that's one scenario and a lot of money could be
00:31:11
used uh and Google and um and Facebook used a lot of money to be the best acquirer to be able to acquire those
00:31:18
businesses and that's the argument for this hey they're at such a scale right now no one else can compete because only
00:31:23
they can pay this this fee as jamath points out with into it in Credit Karma only into it can buy Credit Karma at
00:31:29
that price now the alternative way to think about this is what if there is vertical expansion so instead of
00:31:34
leveraging their existing platform and their existing dominance what if Google in this case is trying to get into the cloud business right and they're
00:31:40
competing viciously with Amazon and Microsoft and others in this Enterprise
00:31:45
Cloud business Marketplace that is continuously evolving changing every year there's a different kind of lead
00:31:51
and in a different uh company that's suddenly growing faster than the others and Google spent $2.6 billion to buy
00:31:56
looker buying looker for $2.6 billion does not Advantage Google's advertisers it does not advant I mean to some degree
00:32:03
might it does not Advantage Google's users and it is not about platform dominance in their traditional ad business it's about vertical expansion
00:32:09
into a new market okay so here's how I'll rewrite the law David if you have over 70% market share in your vertical
00:32:16
you cannot make acquis additional Acquisitions in that vertical if you have they're buying into a new vertical
00:32:21
and so then the caveat is if you're buying into a new vertical you don't have to hit that c we already have that
00:32:27
we already have I mean that that's that's basically the the way the the rules work today is that you look at
00:32:32
market share I mean Coke cannot buy Pepsi Facebook cannot buy Twitter today
00:32:38
um but what we're talking about is at a much earlier stage are you going to interfere with the m&a or are you going
00:32:44
to retroactively go back and unwind these transactions unwinding transactions makes no sense yeah I think
00:32:50
the point is this is all water under the bridge and but the incremental m&a for these big guys is uh very unlikely now
00:32:59
David does bring up a good point unless it's in basically a you know do nothing not that important you know in in the
00:33:06
positioning uh category relative to the Core Business and so this is why you
00:33:11
know it's again go back to like why did looker close faster than
00:33:18
Fitbit it's half the price looker is twice the price right fifth bit is half the price yeah new New
00:33:25
Market completely yeah yeah and so so there is a fear that there is going to be a compounding advantage that
00:33:32
Regulators have a responsibility to stop so I think it goes back to um once you
00:33:38
get to a certain level of scale the thing that we're missing with online businesses is this kind of like you know
00:33:44
there's like a there's like a great original sin here that we're not admitting which is that the internet is
00:33:52
now a pervasive and critical part of human infrastructure as such there needs to be
00:33:59
people that regulate and manage the internet the same way the FAA manages and regulates planes and wind turbines
00:34:05
like think about the fa let's just take Aviation it is impossible for you to go
00:34:11
and just go into your garage build some random thing to carry people from point A to point B in the absence of some
00:34:18
certification okay take agriculture it is impossible for you to basically go
00:34:23
and like build up a farm and build up you know uh livestock or whatever and
00:34:28
all of a sudden just Supply it into [ __ ] soes and Safeway without any sort of like checks and balances
00:34:36
similarly and the reason is because it's simple human infrastructure that everybody relies on and and I just think that we have to admit that now the
00:34:42
interet comp also those are life and death this can be too I mean like what
00:34:48
about the guy that read the post about like the pedopiles in the pizza joint came up with an AK-47 yeah I mean it's quite an edge
00:34:55
case compared to flying on a plane this stuff is life and death at some level but even more than life and death it's
00:35:02
the anointing of power that then determines life and death that and that's I think the key is that it's power yeah jamat do you think that there
00:35:08
should be an internet regulatory body that decides how businesses operate and how content is censored and managed on
00:35:16
the Internet is that what you're kind of suggesting yeah so let me be very specific so I think that there are very
00:35:21
specific kinds of businesses um and business models that should be
00:35:27
overseen specifically I think the first and most important thing is a body that
00:35:34
oversees the collection of user data and how it drives targeting and
00:35:40
identification so privacy concerns around that that's a that's a no uh brander um that's the first one and then
00:35:47
I think the second one is something that essentially tears the Fig Leaf off of internet companies and says you know
00:35:54
what you are the equivalent of a publisher and a platform some weird hybrid that we didn't think could exist
00:36:00
when we wrote these rules and so we're now going to adapt these rules because you know if you think about it nobody is
00:36:07
happy with the internet Publishers today you know the the left thinks that it skews right the right thinks it's skews
00:36:13
left everybody's confused nobody gets what they want um and so I think somebody has to step in and kind of sort
00:36:18
I think this is a good segue to Sax's point and then I guess we we have we have a fork here now in the discussion do we want to go and talk about
00:36:25
censorship and that specific issue across Facebook or do we want to get into Amazon for a
00:36:31
second which way do we want to go SX go to sensorship well I mean we
00:36:36
let's let's jump the fence here should there be to chat's point Sachs a
00:36:42
regulatory body that decides what people can and cannot say on social networks
00:36:50
yes or no no I mean let's think about that what we're saying is we need the
00:36:56
the the PO politicians to set up a regulatory body to control how the people talk about the politicians I mean
00:37:02
that seems like a recipe for disaster what about specific lies and
00:37:08
intentionality to um frame uh debates
00:37:13
incorrectly Saxy poo that's not what I'm saying I'm saying like like you go to a movie and you know there's a little
00:37:19
blurb here that says who can go to the movie and who cannot um you know you get a you buy an album and it tells you
00:37:25
whether there's explicit lyrics or not like you before you turn on the TV there's like some rating agency that
00:37:30
tells you whether your kids should be watching with you my my point is what is the equivalent version we all need to
00:37:36
think about what it is but to say that there should be nothing I think is crazy sax well well I think um so I mean those
00:37:46
ratings are mostly about um you know uh
00:37:51
standards related to to kids you know and um the big internet company companies already have a lot of child
00:37:58
safety features I don't know that you need to create laws around that um and I and I don't think that's what we're
00:38:03
talking about anyway I mean I think the big debate about Facebook or Twitter is
00:38:08
whether they're engaging in censorship or bias um right and that that goes Way Beyond um this topic of of of child
00:38:17
safety so okay let's let's unpack I don't think that they're censoring all
00:38:22
I'm saying is I think you need to label and you need to more clear designate what this content is so that people can
00:38:29
choose like for example on Twitter you know I follow a bunch of people on the right I follow a bunch of people on the
00:38:34
left I follow one or two Q andon accounts only because like I just want to see it all and then I want to judge
00:38:41
and I feel like if I can see everything I can sort of like lay it all on a table and figure out where the rough Center is
00:38:47
and kind of move to that you know so you feel you're intelligent and mature enough to do that shth but the rest of the world isn't no not really but I try
00:38:55
to do it because I think it's important for me would you rather the platforms or some Regulators come up with what you
00:39:00
could see on those platforms tath again not what I can see but there
00:39:05
has to be a simple way for example you know you could have something and again
00:39:10
this this this all all this does is it breaks business models which then breaks monetization and it breaks the market
00:39:17
cap of these companies but for example let's just say you had a new kind of job which was you know all these you had you
00:39:24
hired 500,000 people and these were a combination of lawyers journalists you
00:39:31
know uh academics all kinds of random people artists everybody okay normal
00:39:36
folks bluecollar folks and you paid them full-time to basically read stuff and
00:39:42
kind of like you know uh you know wisdom of the crowd style tell us where this sat in a
00:39:47
spectrum okay of this is on the left this is on the right this is kind of centered this seems laughable this seems
00:39:53
unbelievable this seems relatively credible and I think that you would get you know very quickly and I don't think
00:39:59
the latency would be that high but probably minutes where you know 40 or 50,000 signals would tell you whether
00:40:05
something is you know where something is in the spectrum of you know how to understand it and then that that system
00:40:11
that system will get PA get get played though it'll get gamed right like someone will figure out a way to turn
00:40:16
all of chim's tweet labels into Super Evil tweets and you know now everyone will mute you because you're super evil
00:40:23
yeah I think we just defined George rell's 1984 like or cancel culture right
00:40:28
like if you're pay 500,000 or a million people if Facebook and Google and these guys come together and Twitter and they
00:40:34
pay a body of people to do this work um and so you don't know who posts it you just see the content you read it you
00:40:40
label it it's a classifier so chamat what do you what do you think you would get classified as and then what if you
00:40:46
disagreed with what what you were classified as no but David like what I'm saying is you wouldn't know it's me like
00:40:51
if I wrote an article on medium right and I wanted to publish it in Twitter that article first hits a queue 50,000
00:40:59
people read it they human classify it and then it gets published and now what
00:41:04
if you don't like the way it's classified and you don't want those tags attached to it and you want a place to publish freely without classification
00:41:11
without tagging then there will be a company that supports that too and you'll see how much people care about
00:41:17
that yeah I mean I think the free market could handle what you're saying chth cuz that I think David's concerns would be
00:41:23
the same as mine which is who who's doing this classification what kind of transparency is there and we already have the wisdom of the crowds which is
00:41:29
things that are outrageous automatically get pushed up on Twitter which allows Anonymous and then Facebook seems to be
00:41:36
all the top trends seem to be on the right um let's swing over to Sach saak
00:41:41
what do you think of of the 1984 proposal from uh chamat 500,000 sensors
00:41:47
uh telling you what to think of a post before you read it yeah I mean it's I don't want to bias the question but it's
00:41:53
an insane idea it's it's a it's a little bit like uh Twitter factchecking uh the
00:42:00
politicians they don't like the digital po bur it's it's a it's a form of like soft censorship um and you know I I I
00:42:09
actually think that you know Zuckerberg gets attacked the most but I think his position on speech actually makes makes
00:42:16
the most sense I mean seems like what he said is we want to be a neutral Free Speech platform and you know whereas I
00:42:22
think you know Twitter and um Snapchat for that matter are much more likely to
00:42:27
engage in either uh you know censorship or or factchecking um Zu Twitter's
00:42:34
initial position David was it was the Free Speech platform no I totally agree with I think zuck's position is the most
00:42:41
defensible but it also is the most untenable because it's the most it's the it's it's the least uh technologically
00:42:48
and socially palatable but it is the most defensible and philosophically in my opinion the only position you can
00:42:53
have but it's not it's not going to be what wins right well it's it's it's the the reason
00:42:59
why Zuckerberg is hated is because if you're going to Def defend the principal Free Speech you always end up defending
00:43:06
speech that Society hates you know like the ACLU Andy exactly and and and so you
00:43:12
know Zuckerberg I think has done the best job sticking to his guns I mean the reason why Twitter is sort of uh you
00:43:20
know loved on the left is is precisely because they gave in to the Mob and they've you know they've started
00:43:26
uh taking down accounts that the mob doesn't like or or or or you know factchecking them whereas I think you
00:43:33
know Zu and that and Zuckerberg's refusal to do that and by the way I don't think he's been like perfect in
00:43:38
this regard but he's been much better about standing up for the principal of free speech that's what's made him you
00:43:44
know anathema to the left I think that and the fact that Facebook still gets blamed for freeberg I I have two
00:43:51
specific follow-ups to what David just said for you which is one how much of this has to do with anonymity being
00:43:57
allowed on Twitter versus not being allowed on Facebook and second how much of it has to do with the fact that we
00:44:03
have algorithms that Trend topics if we didn't have those algorithms trending them perhaps this wouldn't be an issue
00:44:09
because if you wrote something that was inflammatory it wouldn't and false let's say in that situation both
00:44:15
characteristics it wouldn't go to the top of the list which is what everybody's kind of upset about is that something that's false goes to the top
00:44:22
of your feed comment on those two issues well I think your second your second point is an important one which is like
00:44:28
social media helps to enhance the stimulation of the amydala in the human brain uh you know you see something that
00:44:35
makes you angry or something that makes you elated you are more likely to engage with it if you see something that is
00:44:41
kind of a rational discussion about something that doesn't incite emotion in you you're less likely to engage in it
00:44:46
and so whatever the engagement model is it ends up you know creating a lot more virality and chatter and and it kind of
00:44:52
gets brought to the surface and there's a lot that's been written and said about this that I don't think were kind of uniquely in a position to to say
00:44:58
anything more on um and that's obviously what a lot of people are kind of concerned about is the uh inflamatory
00:45:04
and polarizing nature of the content that is getting highlighted on these platforms and is getting greater
00:45:09
Distribution on these platforms and then I think to your prior point I'm not sure it's about anonymity as much as it is um
00:45:16
uh about any form of censorship that ultimately can be viewed as bias so Jim
00:45:22
Jordan's points were actually you know as much as the guy Rants and goes and sounds like a guy running on the soccer
00:45:27
field to punch the coach um it's really interesting to hear the point of view that as a conservative
00:45:35
I believe that a lot of what Donald Trump is saying or what some conservative voices are saying is reasonable and that voice should be
00:45:41
heard and to hear over and over about Twitter pulling these things down and then seeing a whole bunch of stuff like
00:45:46
anarchists taking over Seattle and taking over Portland and they don't get their stuff taken down you know them
00:45:52
claiming that they can hold down the streets of Portland and Seattle because that's you know the way that should be doesn't you know uh incite any sort of
00:45:59
censorship but Donald Trump saying he's going to end it incite censorship um and so I think it's not as much about
00:46:05
anonymity as much as it is about um you know having um censorship tied to a voice and censorship tied to a labeled
00:46:13
or tagged point of view or labeled or tagged individual or voice um on the platform so without anonymity I think
00:46:19
the problem goes away for Twitter I think Twitter is working on a project and I've been saying this for a decade
00:46:25
that they should that everybody pay $50 a year $5 a month or 30 bucks a year $10
00:46:30
a month whatever it is to go through a verification process to make sure it's their name on the account which by the way next door is doing at scale not only
00:46:37
do they know it's you they know it's your you're the person who lives at that address because you got a postcard there
00:46:42
I think and in Korea South Korea you're required to put your social security number in to open a social uh account
00:46:50
that would solve the entire problem now that may seem and then it would drive other users who want anonymity to
00:46:55
Anonymous platforms and that's where Twitter is trying to have its cake and eating it too and they're falling on their face they have one level which is
00:47:02
troll accounts they can do whatever the hell they want playing on a same playing field with people who uh can and this is
00:47:08
just a disaster for them the Jim Jordan may be an idiot um and just a loudmouth
00:47:13
but I think I agree with you if the situation was reversed and we were talking about Obama being censored for
00:47:18
some reason and the right and right-wing people or leftwing people um being
00:47:24
silenced or deprecated the platform you know soft band uh people would be up in
00:47:30
arms but it that was a different form he should be doing that in a censorship and they should have a censorship committee talking about that what do you think
00:47:36
chamath about these two issues anonymity on these platforms and the Velocity in which things that outrage people because
00:47:42
you yourself chth went from hold on but I want to CU this up for you chth you yourself went from being uh a perennial
00:47:49
guest on a lot of these programs and then now since you've been a little bit more vocal about how you feel about
00:47:54
social issues when you said break everything up who cares on CNBC and then when you said um who cares let them fail
00:48:01
they don't get their summer Hampton's house you gained 150,000 followers and now you've learned that if you're more I
00:48:08
don't want to say the word outrageous but if you're more vocal about social issues you're going to gain a lot of
00:48:13
attention um do you think you should have been labeled as somebody who is
00:48:18
hysterical by your 500,000 people or being
00:48:24
outrageous um both and all platforms are littered with
00:48:29
fake accounts um the interesting factoid from yesterday was I think Facebook says
00:48:34
they take down 6.3 billion fake accounts or something some crazy crazy crazy
00:48:40
number so they are paying playing wacka Twitter just basically says we don't have the team in the infrastructure so
00:48:45
we just let the six billion accounts be that's the only difference between Facebook and Twitter it's a it's a it's
00:48:51
an acknowledgment uh of the problem and a transparency on the reporting so um you know look my my point of view
00:48:59
on this is that I think that uh irrespective of what I believe about free speech I think
00:49:06
it's becoming harder and harder for me just as a Layman reading to figure out what's true and not true um I think that
00:49:14
the line is getting very gray and I think that sources that used to have
00:49:20
complete um Integrity that were you know just um just beyond reproach in terms of
00:49:27
their integrity um it's not clear anymore because the business model of the internet is driven towards
00:49:33
clicks so I think what's actually happening is that we are dismantling um
00:49:40
information and news and journalism um the first place where I
00:49:46
think that goes is places like substack which is going to rebuild it Bottoms Up
00:49:51
where people will vote with their subscription dollars what to believe and what not to believe and then on top of that people will
00:49:57
overlay aggregation tools so that you can actually have multi subscriptions
00:50:02
and create certain of like next Generation magazines and content subscriptions or whatever I think that's
00:50:08
where the that's where the world is going in terms of information and content Jason my honest belief is that I
00:50:14
don't think I've ever said anything that particularly crazy I just think that I'm reasonably intelligent and I'm precise in what I say and it cuts through a lot
00:50:21
of the [ __ ] because most people have nothing to say so um you know when I make a [ __ ] investment I write a one
00:50:28
pager and I post it and I'm willing to be held accountable you know when I don't understand about climate change I
00:50:33
just post about it even though I want to invest $2 billion of my own money in it and so I think uh being authentic and
00:50:40
just being straightforward is is sort of like what is valuable at some level on the internet uh I think that governments
00:50:47
are going to regulate these companies let's just be clear yeah and and you you whatever I think about censorship it
00:50:54
just doesn't matter what I think because governments are of a belief that these
00:50:59
platforms craft and shape public opinion and sentiment which Drive the
00:51:06
aggregation and coalescing of power which fundamentally disrupts the business model of the
00:51:11
politician uh let's go swing over to Sachs here uh saaks any comments on that censorship issue or uh
00:51:19
the uh once very respected sources of news maybe being less Ed now I think the
00:51:26
New York Times came to mind when uh chth was sort of outlining that phenomenon
00:51:32
and then we'll move on to Amazon yeah I mean I I think there are things that these platforms can do to elevate the uh
00:51:40
you know the discourse you know the quality of the information people are getting I think that um eliminating the
00:51:46
bot accounts I think it's a huge problem on Twitter that that it's you know that they're out there um they're not really
00:51:52
doing much about it um I think that's something they could improve prove and fix um you know requiring people to to
00:51:59
be who they purport to be you know I think and this is tied to the bot issue of you know not allowing um these sort
00:52:05
of um sock puppet accounts um so but but the thing about those those steps that
00:52:12
they could take is they speech neutral right the rules would apply to everybody um you know to freeberg point and so I
00:52:18
think they should look at doing more of those things but you know what I'm concerned about is that um you know
00:52:26
so so much of the um the debate so much of the pressure that's being brought on Facebook is to actually moderate and
00:52:33
control the the type of speech that occurs on its platform and um and I
00:52:38
think the reason why Zuckerberg is is attacked more than say You Know Jack
00:52:44
dorsy is because he's been more resistant to to doing that I I think I think it's actually because you have a
00:52:49
bunch of what seems like real names but again I think that there's a fake account issue on Facebook that's just as
00:52:56
bad as Twitter it's just the difference is you know the the fake accounts on Facebook have proper first and last
00:53:01
names whereas Twitter you can have all kinds of alpha numeric garbage as a as an account name so here's a different proposal why you know maybe what maybe
00:53:09
what we need is the decision that we allow complete unfettered free speech
00:53:15
and there's a layer of both Facebook and Twitter and YouTube where that's completely allowed but the precursor to
00:53:21
have that access is you need to put in your social security number or something that's uniquely identifiable by your
00:53:26
government so that if you say something and there's a law against you saying something already a pre-established law
00:53:32
there's recourse where can you go and be anonymous to moth because you know on a web page you can create any web page you
00:53:37
want no but no what I was going to say then I think what it creates is um a decision by a user to coales on
00:53:44
completely different platforms if what you want is complete anonymity for very different reason and I think that that's
00:53:50
very reasonable too my point is the the solution to this David is diversity not to have one thing and two companies try
00:53:58
to create some Swiss army knife Frankenstein product that solves this it's just not possible and I think we're
00:54:03
both saying the same thing which is like you have completely different behaviors trying to go in through the same channel
00:54:10
it's not possible I actually I I like the idea of these platforms doing more to eliminate bot accounts and and uh
00:54:17
anonymity um because th those are neutral rules of the game and they do improve the quality of the debate that
00:54:24
occurs on those platforms um I think those would be good things I think it's just hard to do I think that those
00:54:29
companies may even want to do that it seems like Facebook certainly does it's just a hard thing to execute it's actually not that hard I mean if you
00:54:35
just said Hey listen this account in order to have a verified account you have to have a phone number and email so
00:54:41
that's two steps that a spammer trying to create a lot of accounts would not be able to do because you'd have to get
00:54:46
burn a phone number after burn a phone number which is a cost it's possible but it's a cost and if you want to be
00:54:53
verified we need your phone number and and we need your email address and we need you to you put in your credit card
00:54:59
and get charged a dollar on your credit card just that credit card over overnight Reddit would become the new
00:55:04
Twitter overnight Reddit would become 4chan would become the new Facebook I mean overnight like like I'm not saying
00:55:09
to have an account free brg but to have the blue check mark so you would still be able to and then over time people could say I don't want to see replies
00:55:16
unless they've been verified and it could be just a toggle you pick by the way Facebook Google and Twitter already
00:55:22
have this mechanism because that's what they do to graduate advertisers up the spending curve you know you can start as
00:55:28
an anonymous Advertiser just spending you know onesie TWY dollars um you know just off of a web page basically just
00:55:34
you go through and you do self- serf ads and the more you spend or the more targeting capability you want you
00:55:39
graduate you self-identify you give more information you get more capability back you get more trust in the system so it
00:55:46
does exist for the customers of these big tech companies and this is the other big thing what it shows you is that it's
00:55:53
actually solved the problem for the customers is just doesn't solve it for the you know feudalist feed stock which
00:55:58
are the users because they won't pay and so if you said Hey listen there's an the customers the users Twitter's coming out
00:56:06
with a paid version so they're obviously on the on the halfway there they're going to come up with a paid version of Twitter Jack said it on his uh quarterly
00:56:14
uh earnings I'm G I'm going to sell my Twitter stock well I mean it's not it's not one of the other freeberg though you
00:56:20
don't have to pick one or the other you could still be anonymous but you have the opportunity cuz right now they're not new verified users and unless you're
00:56:27
a muy to muuk you don't get to even go down that route so shouldn't everybody have the ability I I I would like I mean
00:56:33
I personally would like Twitter more if it verified identity I mean I don't I don't think there should be a speech tax
00:56:39
I don't know why they have to charge a dollar but um but but taking charging a dollar means we have your credit card
00:56:46
it's just another hurdle that's why I put it dollar yeah yeah you you you can do like a $1 off without actually
00:56:51
charging anyone's card yes you could do that for example like if you if you you actually force people to verify by
00:56:56
putting in their social security number like there's a couple guys I follow I'll just name them Scott Adams who wrote the
00:57:02
Dilbert comments there's a guy Mike who I'm really not sure I understand his
00:57:08
politics but I follow him because I because you know he he post all kinds he a RAB Rouser my point is you know it's
00:57:14
it's not just people on the left but I think it would be people on the left people in the center people on the right who would basically pay the quote
00:57:21
unquote tax because they're already real people and they would just they would
00:57:27
guarantees and insur that Twitter w't be arbitrary and I think that makes Twitter better and if it maybe it makes it
00:57:34
smaller right and then maybe you're right freeberg like 4 Chan or eight Chan or Reddit become good for a different
00:57:40
kind of behavior by the way I mean like that's what we do today we don't eat the same [ __ ] thing every goddamn day we
00:57:45
don't wear the same pants every day I agree with where he's going with that I mean the the the defining feature of
00:57:51
Reddit is that it is basically Anonymous people have usernames but but you never know who it is pseudonyms and it creates
00:57:58
a certain kind of conversation and that's fine Twitter is supposed to be
00:58:03
real people I mean it's not I mean Facebook even more so but you know when I think about the accounts that I follow
00:58:09
on Twitter um you know it's it's you know all of them are are real people occasionally you'll get occasionally
00:58:15
you'll get aags you you'll yeah you'll get like um a startup L Jackson or something like
00:58:21
that and um you know and I and I think that's okay yeah but you would choose to then follow them the difference with
00:58:28
like a startup L Jackson is they're not a fake account they're just using a pseudonym right know that when you
00:58:34
follow them and over time they've proven to be to provide some value that makes people follow them and so you could be
00:58:40
anonymous if you get a certain number of followers I guess you rise above the noise here's another solution there
00:58:46
there are no um there's no Nuance about truth or how much you believe this is
00:58:52
true as a voting mechanism so if you were verified on Twitter and there was a scale that says how true how truthful do
00:58:59
you believe this is and you could slide it uh and pick I you know from one to five you could actually have another
00:59:05
signal there what do you think about some sort of a signal to chat's point about uh Community value saying I buy
00:59:12
this I don't 97% of people wouldn't use it and the 3% that do would completely
00:59:17
bias the result okay trth what do you think would happen I agree with freeberg I I don't I don't think that's a it's just I don't think it's a really good
00:59:23
idea um my my my only comment was just offering the the other thing by the way I know it sounds crazy was just offering
00:59:28
it as like the you know the way that this um negotiated solution will end up
00:59:35
and it's kind of sort of what these internet companies are being forced to do which are these weird you know pseudo
00:59:40
action bodies that like review things and like you know so it's all just a slippery slope to that outcome um but by
00:59:47
the way uh you you were speaking about startup all Jackson you know there was another guy super mugatu um and you know
00:59:54
he turned out to be this you know really good young upand cominging investor Dan McMurtry and he was Su you know he used
01:00:00
a pseudonym for a long time build up a huge audience and then flipped himself and basically came out and said here my
01:00:05
name is Dan McBerry and I run a fund and you know uh it was wonderful yeah I think it's a very good marketing
01:00:12
strategy it's a growth strategy now be startup Al Jackson up becom a venture partner when are you going to announce
01:00:18
that you're the guy behind VC brags like I'm not ready to do I'm not
01:00:25
ready either I'm not people thought it was me I was like I'm getting tortured wait till you hear that I'm the guy
01:00:30
behind Zero Hedge that'll really freak you well zero zeroe head just instructive didn't he get banned or she
01:00:36
get banned for posting about stuff in Corona virus that eventually turned out
01:00:41
to be acceptable and true now imagine if he had verified his account he had his Social Security number he had all that
01:00:47
stuff in there just verify that's it just information that says Zero Hedge is real it's a real person yeah and you
01:00:53
know the rule is when you're that level of verified you can publish whatever you want so you can you can say false
01:00:59
statements as a real person so Donald Trump is a real person he's a verified account and he's saying things that Twitter is then determinating are false
01:01:06
or inflammatory I would rather you know um them not try to do it um and I'd
01:01:13
rather have pundits that you can believe in so like the other problem is like look when you have public figures you
01:01:19
have pentry around public figures but the problem isn't what that person say says it's you can't believe the punditry
01:01:26
because half of them are fake so at some point you have to break the cycle and somebody has to be real well and this is
01:01:33
the problem with the the Trump issue in a pandemic is two edge cases put
01:01:39
together and now we're figuring out what the actual cost of it is Trump said masks are [ __ ] you don't need to
01:01:45
wear a mask blah blah blah I choose not to wear a mask I'm not going to give people a satisfaction see me a mask turns out masks are correct we we should
01:01:53
have put that or or should we have put in front of Trump's non-mas comments hey this is
01:01:59
against what the guidelines are um or the fact is the who said the World Health Organization said you shouldn't
01:02:06
wear masks then it turns out now we have a bunch of conservatives dying who didn't wear masks no I don't think I
01:02:14
don't think you should have put anything there um and let all the conservatives who believe him die it's it's not about
01:02:19
letting conservatives die I think that's a crazy way of positioning it like he's allowed to have his opin
01:02:26
and soci has shown that the way we used toate like veneration is sort of like uh
01:02:34
it's kind of it's been disrupted by social media like the idea that you venerate somebody because like they won
01:02:40
an election in a moment is so crazy because they are basically like you and
01:02:45
in many cases maybe dumber than you with respect to you all these ideas surrounding the idea that we need to
01:02:52
regulate these platforms um I think we should just just remember that the way stuff gets into your feed is that you make the decision to follow it you know
01:02:59
these feeds are self-curated I mean there is this issue about well you know the algorithm does sort of um emphasize
01:03:06
or or sort of increase the volume um and you know we want to make sure those algorithms um you know are done in a a
01:03:12
neutral way they're not they're not biased somehow but you know the the the content that appears in people's feed is
01:03:18
content they've they've chosen to see with the exception of trending topics on both platforms well like I said though as
01:03:24
long as those algorithms are unbiased and work in a speech neutral way I think they're they're fine um but the you know
01:03:30
the the the reason why Facebook has been boycotted um is is that they're they
01:03:38
refuse to censor some of Donald Trump's tweets you know and but but you don't see those uh you don't see those posts
01:03:45
rather unless uh you've chosen to follow them I I think it's crazy that they want to ban him problem is it's a chain of
01:03:53
it's a chain of fake accounts and real accounts right let's be honest It's a combination of both that exists on both
01:03:59
Facebook and Twitter to amplify content in ways that none of us really understand and I would I would be very
01:04:06
skeptical that anybody there really understands every single piece of content how and why it gets weighted the
01:04:14
way it does and you know like I bet you that there's probably a way to tell whether an account is fake I mean
01:04:20
obviously they have system Integrity tools to figure this out that's there's no way you could have beli eliminated 6 billion accounts if that wasn't true um
01:04:27
but then you know you choose not to suppress the waiting of those or maybe you do suppress the waiting of them entirely it's just an alter you're
01:04:34
talking about but but in terms of implication okay so maybe maybe you can game the trending topics that way but
01:04:41
you can't get in my feed unless uh either I choose to follow you or you you
01:04:47
pay to you know run an ad which my eyes are just trained to skip over um so I
01:04:53
you know I I I think if you were to ask the average person do you believe that you are um sort of um influenced by uh
01:05:03
deceptive content on Twitter and Facebook uh or you're sort of uh unduly influenced uh they would say no you know
01:05:09
none of us believe that we are but then if you ask but if if you said uh do you interact in groups and forums uh with a
01:05:17
bunch of people that you don't know the answer would be% yes but what I'm saying
01:05:22
is that the average person doesn't believe that they're unduly influence but but if you ask them or do you think other people are they would say David of
01:05:28
course like it's like you know when you're having a [ __ ] Slurpee it's like you know do you think that this is unduly going to hurt you
01:05:34
no it's 1,200 calories of liquid sugar all right I think we beat this horse to
01:05:39
death there's no solution uh just on the edges but let's let's go to Amazon because I thought that this was a
01:05:45
particularly interesting one Amazon um I thought came out the best of everybody
01:05:50
and is the least likely to be broken up I think some of you agree with that uh what were your impressions on
01:05:57
Amazon's performance and Amazon in terms of being broken up let's start with you
01:06:02
freedberg and then we'll go back to shath I think um the intention of antitrust law is obviously to protect
01:06:08
consumers and protect markets and protect um market pricing from being manipulated by monopolists or monopolies
01:06:15
and so um you know the the the the point that was made about Walmart years ago is the same point that's being made about
01:06:21
Amazon today which is that they're crushing small local businesses um and as a result uh there
01:06:28
is a lot of damage being done and they are quote unquote too powerful but the reality is that the the pricing um
01:06:36
effect of what they're doing is what needs to ultimately be scrutinized and I think is what will ultimately Drive
01:06:41
whether or not these guys have either some massive penalty or get forced to break up and so you ask yourself the
01:06:46
question look if I'm going to buy call it um a mattress or let's let's use something like a pillow uh is it cheaper
01:06:53
for me to buy that pillow as a consumer through Amazon or from the local store now what if the local store is put out
01:06:59
of business because of Amazon and now Amazon is the only place I can get a a pillow is the pillow now going to be
01:07:06
more expensive or less expensive than it would have been otherwise um and I think that is the lens by which we need to
01:07:12
kind of assess and The Regulators will ultimately assess whether or not Amazon is causing harm in the marketplace
01:07:18
because of its position and its power fre um look I have several businesses
01:07:23
that sell on Amazon um and it is [ __ ] expensive one of my companies I'm on the
01:07:29
board of we we've been the number one food product on Amazon multiple times uh and we we kind of slide up and down the
01:07:35
top 10 can you say what that is yeah soilent soilent and so we sell a lot of soilent on Amazon um and um it is
01:07:43
expensive man I mean the Fulfillment the shipping the advertising fees they force
01:07:48
you to pay um I will tell you that as a business owner or board member of a business that sells and I have several
01:07:53
others that sell on Amazon too um it is a it is a grind um and it is cheaper for
01:07:59
us to sell directly through Shopify just raise the price on Amazon um so to some extent so Amazon
01:08:07
this is actually part of the problem so Amazon forces certain um best pricing negotiations if you're a large seller on
01:08:13
Amazon you have to make sure in order for them to promote you and make you kind of a sponsored item and show you at the top of the list you have to give
01:08:20
them the best deal sort of like what Walmart does right you can't have a cheaper price anywhere else got it so that was something that did not come up
01:08:26
they forc you to have the best price there even if you charge more on your website in these negotiated deals yeah
01:08:33
and so you have to make sure that you're providing um uh and I'm not sure what the deal is specifically with soyland so
01:08:38
I don't want to kind of speak in correctly here uh heard the same thing from other folks what if that is kind of
01:08:44
part of what happens and so um I will tell you like it it is harder for it is cheaper for me to sell soilent I think
01:08:50
it's cheaper uh for some of these products to be sold I can tell you my other company which we sell quinoa it's
01:08:55
cheaper for us to sell through retail stores than it is to sell on Amazon we actually give up more margin selling on
01:09:01
Amazon would you do it because of the volume and because they've aggregated all the so you've made the decision as
01:09:06
an entrepreneur to sell your quinoa in all places even though you lose some margin you make it back in aggre well
01:09:12
this this goes to the market maret well this goes to the market problem because now I as a I have less Choice as a
01:09:18
business owner because the only place I can find consumers is in this Online Marketplace called Amazon can no longer
01:09:24
go sell at 50 local grocery stores because people don't go to the freaking local grocery stores anymore and that's
01:09:29
obviously a little bit of an extreme statement but let's say I'm a pillow guy I can't go sell at 50 pillow stores because they've all been shut down
01:09:35
because all the consumers go to Amazon but could you also sell at Target and Walmart and those other competitors who seem to be doing just you know pretty
01:09:41
well actually they're doing well yeah and and a lot of people have said that they're the kind of you know the
01:09:46
exceptions but there's a thousand versions of Sears and other stores that haven't done as well Walmart and Target
01:09:51
just happen to be extremely well-run businesses but there's nothing fundamental about Amazon kicked you off
01:09:56
the platform and said we're not going to allow third party sellers would you be happier or would you be sadder it would
01:10:02
be sadder got it chamath what are your thoughts Amazon specific yeah I think
01:10:07
David said it really well up front um which is that it's a it's kind of a when
01:10:13
and not an if so it's you know Amazon today I don't think is at risk just
01:10:19
because its End Market is so big but I think within 5 or 10 years um it definitely will be looked at
01:10:26
through the same lens as Facebook and Google and um actually just those two um
01:10:33
look and I and I think David said it also really well like the antitrust law that you would get um you know to be
01:10:40
successful if applied to Facebook and Google has nothing to do with users and content and it has everything to do with
01:10:46
the pricing of the ads to their customers and if anybody actually were smart enough to figure out whether there
01:10:53
was some some way in which their auctions were working um that was
01:10:58
effectively pricing inventory in a market quote unquote or in a system manipulated way that's probably the best
01:11:05
hook to to NAB one of these folks in anti trust law but other than that it's going to be regulation in terms of
01:11:10
Amazon I think they're going to get away unscathed what's incredible by the way is you know two days later they're like hey by the way we just got an FCC
01:11:16
license and bring a launch of 10 billion dollar satellite constellation and you know if you if you looked at their uh
01:11:23
RFP to to the F uh to the FCC the number of people that you know basically
01:11:29
complained and cried it was incredible by the way I think this is a huge important point that we haven't made
01:11:35
which is the benefit of scale for large Innovative companies there is no way any
01:11:40
company would have out of the blue been able to afford a 10 billion distributed satellite program without having
01:11:45
customers and all this other stuff lined up Amazon can afford to take that risk just like alphabet has taken the risk
01:11:51
with self-driving cars and did so before anyone else from many years which is a net benefit for society correct Dave which is a net benefit for society so by
01:11:57
having scale by having incredible profits by and then by reinvesting it in R&D creating jobs innovating it's the
01:12:04
only way this kind of stuff is going to get done you're not going to get it done by breaking up these companies and having a 100 companies that only have
01:12:09
$10 million of profit each and then each of them are you know no one at all can afford to do these Grand important
01:12:16
projects that uh that move markets forward ultimately for Humanity freeberg you see these trillion dollar plus
01:12:22
companies as because they can make those big swings a net benefit for Humanity as
01:12:27
a technologist and as a kind of person that hopes for the future I hope uh I
01:12:32
hope that they uh that that these sorts of companies can continue to persist and uh that they're led by people that want
01:12:39
to take Innovative risk with R&D dollars and by the way if they don't they're going to [ __ ] fail eventually right it's these guys that are leading these
01:12:45
companies uh and and putting these crazy bets on crazy new ideas that are allowing these businesses to remain
01:12:52
competitive um and if they didn't and you know some big company manager were to come in and
01:12:58
start running these things and distributing cash and dividends back to shareholders these wouldn't be happening and and you know capitalism would take
01:13:04
care of itself and then the next big Innovative risk taker that can generate a profit and reinvest that profit in a
01:13:10
smart way would end up winning in the marketplace so uh s you are a big investor in SpaceX at craft Ventures I
01:13:17
understand uh and when you see Bezos copy every single thing Elon does from
01:13:23
you know launching the Rockets to then putting up the satellites do you think he's just a
01:13:29
copycat well I you know I I think he's the scariest monopolist out of the the whole bunch um you know if you look at
01:13:36
kind of Amazon versus say Google or Facebook or apple I mean th those other companies are sort of sticking to their
01:13:42
original footprint whereas Amazon keeps expanding into new areas um you know
01:13:47
it's that that whole mantre has about your profit is my opportunity and so yeah with each uh you know with with
01:13:54
each advancement they make as they get into you know as they get to a new level of scale they then turn around and uh
01:14:01
and seek to take over kind of um the the you know the areas that um that their
01:14:07
vendors or business partners are operating and so you know it started with first they did retail you know books and then they expanded to other
01:14:13
areas of retail and then they take over um infrastructure and now there's talk about them getting into to Freight or
01:14:19
Trucking um and so yeah they keep expanding into these new areas and it's it's really a statement about our
01:14:25
politics I agree with jamat that that Bezos went pretty much unscathed and I think it has a lot to do with you know
01:14:31
he he did win the internet with that opening statement that he gave it was a really um sort of great you know Rags to
01:14:38
Riches only in America type story and um and so I think I agree with jat is going to get away pretty unscathed but I I do
01:14:44
think that they are the scariest monopolis of the bunch well comment specifically on him copying every one of
01:14:50
Elon musk's ideas well you know uh copying is it it is it
01:14:58
is sort of a part of the game you know I it is part of the game and I've I've heard you attack Zuckerberg for doing
01:15:03
the same thing and you know look I I get it you know we we we prize uh Innovation
01:15:10
and we we we love innovators um but as soon as you say that you can't that
01:15:15
other companies can't copy those Innovations you do stifle progress I I look at it as more how consistently do
01:15:22
you do that your playbook when you look at uh Amazon Basics this is the point I wanted to
01:15:29
make when and I made in my my earlier podcast which was you know the Amazon Basics and the third party seller system
01:15:36
is the thing that uh they keyed in on on these hearings they did not key in on uh
01:15:42
the issue of that freeberg brought up which was what is the margin they're taking from those third party sell which
01:15:47
I think would have been a much more DEA uh approach to questioning them them but
01:15:54
when it comes to third party sellers the fact is they're allowing people to
01:15:59
compete with them on their own platform which drives prices so low and when they
01:16:04
make a better USBC cable that doesn't take a genius to make a better cable so
01:16:10
do you think Amazon Basics should be allowed and is great for Humanity or do
01:16:16
you think that that uh using of the data because they have the sales data on it is in some way abhorent and a given the
01:16:24
way antitrust laws are currently framed uh Sachs well okay so I I think this is an
01:16:32
area where so the area you're talking about is the way that these platforms treat the applications or small
01:16:39
businesses that operate on their platforms and I do think this is a good area for for Congress to keep
01:16:45
scrutinizing um you there there there's a saying in in in chess that that the threat is greater than the execution so
01:16:52
sort of a chess stat strategy principle I think that's true here where um we I I
01:16:57
I think the execution would be a disaster if we actually imposed a lot of these rules if we broke up these companies if we stopped Amazon from
01:17:04
innovating I think that would be a disaster for uh for for those companies
01:17:09
and for the economy because I do think they they do a lot of good things but in a weird way I think we have to keep threatening to to do those things in
01:17:17
order to get these companies not to do anti-competitive things I mean we heard Bezos say that he couldn't guarantee
01:17:24
that they weren't using their uh their their sellers data to to to to in
01:17:30
inappropriate ways basically Amazon to to break Amazon's own policy and so I think you do have to apply this kind of
01:17:36
scrutiny to these companies because I I don't think we want to be retroactively uh you know remediating a
01:17:43
situation I don't think we want to be breaking them up or doing something like that but I do think we want them second guessing these anti-competitive
01:17:49
decisions before they actually happen um because otherwise you know so some
01:17:54
scrutiny some rules but we certainly don't want to ankle them versus their competitors in
01:18:00
China as we wrap up here uh because we're getting way past our hour we're now at uh 80 minutes and uh we set a Max
01:18:07
a 90 here was what we all agreed on um I want to talk about the election we are now at the 100 day Mark we all thought
01:18:14
Biden was a shoe in now I have my own thesis I want to float it and see what
01:18:19
you guys think um you had Trump start wearing a mask last week telling
01:18:26
everybody they should wear masks now there's Universal discussion of wearing masks we've got a little bit of vaccine
01:18:31
hope and then we'll get to friberg's position on is That vaccine false gold or is it actual reality but we know that masks are going
01:18:39
to take 3 or four weeks uh if they're implemented properly for us to see the
01:18:45
case load go down which then the case load starts going down and 3 or 4 weeks after that the debts would start going
01:18:50
down we may have even seen a little plateau in the number of cases cases is ramping up we hit a record 850 or
01:18:56
900,000 just yesterday at the time of taping I think on the 29th of July now my thesis is Trump goes all in
01:19:05
on masks the vaccine starts to show promise right as the debates start he
01:19:13
gets in there with Biden we see case loads go down we see debts plummet we
01:19:18
get down under 250 debts per day in America by September 15th the market
01:19:25
rips and on SE end of September we have the first presidential debate Biden dunks on a scile or maybe not crisp
01:19:34
Biden Trump sales in and we were just talking two months ago Anything could happen but Trump was definitely not
01:19:40
going to be there let's go around the horn freedberg vaccine false gold or
01:19:46
really promising and what happens in the election I I think there's tons of
01:19:51
promise with vaccine news in the next two months uh 3 months uh I guess the
01:19:59
point is you're going to hear more upside than you're going to hear downside news on vaccines uh for sure
01:20:04
you know whether or not we have a vaccine and by when and y y percent chance we have a vaccine we're gonna
01:20:10
have a vaccine I think it's a function of how many doses um at what point in
01:20:15
time um and you know there there's this 30,000 trial happening with madna right
01:20:20
now there's a a Russian vaccine that just got approved yesterday in Russia that they're saying is ready to go and they're starting to distribute it so
01:20:27
there is a vac there are vaccines right this is a a no known uh so so that news
01:20:32
will only continue to improve and build and there'll only be more and more indications of success with vaccines
01:20:38
between now and in November how that affects markets I think I'm not sure that drives markets as much as some of
01:20:45
the other stuff that's going on in markets with uh with the fed and um and with policy and with stimulus packages I
01:20:52
think those are are are frankly um important drivers right now and how much the markets ultimately affect the
01:20:58
election I don't know um so uh yeah it's still it's it's all still pretty
01:21:03
uncertain um who's G to win and uh I think it's pretty uncertain i' you have
01:21:09
to put your entire net worth on one person go um yeah I I I I still think Trump is
01:21:18
um I I I I kind of have been uh vacillating on this I I think Trump is
01:21:23
probably uh only going to improve from here on out so your entire net worth is on the line in three two place your bet
01:21:32
I'd go Trump wow Trump wow it's still it's it's still it's still to me I mean Trump has has got to be the huge
01:21:38
Underdog here I mean right now it looks like Bay's going to win I mean his basement strategy could backfire in the
01:21:44
sense that if you know fundamental conditions improve with respect to covid or the economy the fact that he hasn't
01:21:50
said anything done anything gone anywhere um you know it it it it could it could turn out to be a mistake but right now
01:21:57
it it looks like it's working and um and you know Trump seems to be completely knocked off his game um you know just
01:22:05
earlier in the week he floated this trial balloon about delaying the the election that was completely shot down
01:22:10
by um Republicans and it you saw that what did you think as a republican when
01:22:16
you saw him tweet that what did you think what was your emotional visal reaction as our token you know I'm not
01:22:21
uh yeah I I I don't I don't necessarily identify with with partisan politics so let me just I have to state that what
01:22:27
was your reaction as an American to him saying delay the election of course everybody everybody shot it down for
01:22:32
your reaction everybody shot it down for good reason everybody your reaction of course of course we're not going to
01:22:38
delay the election we've you know um you know we we we haven't delayed the we didn't delay the election to to
01:22:46
fight being pinned as a republican he's it's not going to [ __ ] with your deal flow saxs you can be a Republican
01:22:53
okay your entire net worth we have to wrap your entire net worth sacks you could right now three two yeah right now
01:23:01
it looks like Biden's going to win that Trump's Trump's been knocked off his game and and me to say like I I think the the problem that Trump has right now
01:23:07
is he's a Salesman without a sales pitch um you know you go back to the state of the union preo he had it all worked out
01:23:14
he was going to run on the greatest economy ever keep America great that issue's been taken away from him and it
01:23:20
seems like he's still trying to regain his footing he's trying to figure out what to run on and the fact that he can't do these rallies which were really
01:23:27
you know the fact that he was able to go in 2016 to these swing states he would be you know flying around on his plane
01:23:33
and and and he would three he did three rallies a day in these swing states with tens of thousands of people wanted it he
01:23:39
wanted to win it was it was it was that and it gave him a way to go over the heads of the media and speak directly to
01:23:45
the people and then those people talk to other people there's a lot of Word of Mouth um and so he the inability for him
01:23:51
to hold those rallies I think has just been um devastating for the type of campaigning that he likes to do and so
01:23:58
in a weird way we have less than 100 days to the election but it feels like the campaign hasn't really started yet
01:24:04
because Trump can't do rallies and Biden hasn't left his basement okay um chth
01:24:10
entire net worth on the line all spacks spack b spack c spack d whatever you got
01:24:17
spack up all your spacks on the line everything the Warriors position three
01:24:23
two two we don't need to guess but I'll tell you why um you know uh we had a 33%
01:24:32
drop in GDP we have double digigit unemployment and I think Trump's real
01:24:39
path to winning the White House which we talked about before was getting an enormous stimulus bill passed and he
01:24:46
didn't force the Republican Senate to the table to make sure that these unemployment benefits didn't roll off
01:24:52
off now there's a very practical problem with these unemployment benefits which is that it is not administered at the
01:24:58
federal level it's administered by literally 50 state agencies that run
01:25:03
relatively decrepit software now just so you guys don't why did we pick $600 it was an estimated numerical average
01:25:11
because what the Republicans really wanted to do was just top it up you know whatever you used to get to get to 100
01:25:16
and it was technically not feasible to implement across 50 different insurance
01:25:22
in Boise Idaho is different than somebody in New York so they they were
01:25:27
like ah 600 bucks so my point is uh it's going to take 4 to eight weeks to
01:25:33
reimplement unemployment insurance once we decide what we're going to do so that
01:25:39
basically if you start it today puts you somewhere between September 1 and October 1 and the you know so you have
01:25:47
then 30 days to basically catch a positive Tailwind or 60 days so call it midpoint 45 days you know you have now
01:25:54
Federal eviction laws that are rolling off so I think that it's setting itself up for a diff very difficult path um he
01:26:02
just stopped spending I believe in Michigan Trump did um which is you know
01:26:08
not a good sign um he actually has overs spent in Georgia um so if you look at
01:26:14
the facts on the ground your entire net worth goes on no Biden it's a it's a
01:26:20
languishing campaign as of today David is right he's a Salesman without a pitch
01:26:25
and unfortunately he's a the path isn't clear the path should have been paved with money it's such a no-brainer here
01:26:33
let me let me give you one last he printed all that money too and why would you stop printing the money if you gave
01:26:38
everybody $1,200 and six weeks of unemployment why not just do it for another six weeks and give everybody
01:26:44
another 1,200 I don't understand why that's such a difficult decision for Trump freeberg go let me give you a
01:26:49
scary poll that just came out by yugov it said says um 55% of supporters of
01:26:55
Donald Trump say that they will not accept the election victory of Joe Biden
01:27:00
if mailin votes are are are allowed wow so you know the the framing of this is
01:27:06
actually a little bit more serious than just who's going to win there is a further polarization constitutional
01:27:11
crisis question rioting you know whatever disregard for the election entirely kind of moment coming up here
01:27:18
because Trump and others have kind of framed this as such a non-election election because it's all fake and it's
01:27:25
all fake news and you know this is all part of the conspiracy so there is something scary Brewing I think and that
01:27:31
that's what I'm kind of most interested in tracking is really where does this all go percentage chance that we get to
01:27:37
a constitutional crisis and Trump says I'm not leaving the White House on a percentage basis freeberg I don't think
01:27:43
he'll say I'm not leaving the White House I think he's going to be [ __ ] happy to go back to wherever he's going to go um yeah but I think I think
01:27:50
there's going to be other ramifications that are worth us figuring out and thinking about because that's the scary stuff that's coming next okay a 25%
01:27:57
chance of a constitutional crisis I think if the elections close we could easily have like a Gore V Bush type
01:28:03
situation um it could be very damaging for for the Republic I do not think there will be a hanging chat issue in
01:28:09
this election this is going to be one way or the other incredibly decisive on an electoral college level okay final
01:28:17
it's not set up for it to be that that close Okay well I I I don't think eltion
01:28:22
it right now it's not trending to be close at all it's trending to be a blowout and so I think we'll avoid the the crisis because it's not close and it
01:28:29
looks like Biden's going to run away with it but if it does get super close um you know I could imagine there being
01:28:35
a crisis based on people not accepting the if the margin of error is within the margin of these mailin ballots and you
01:28:41
have you know 30 40% of the population saying they're not going to accept it um
01:28:46
I'm not saying we'll have like a legal crisis but I think you could have a legitimacy crisis it could be very bad for the Republic repu uh not as bad as
01:28:53
Trump's presidency clearly uh so uh final question final final question if
01:28:59
Trump believes he's not going to win and he's essentially given up right now which it feels like he's kind of given
01:29:06
up what would do you think who would win if Trump says Nikki haly and Pence can
01:29:11
run I've done such an amazing job I've been the best president in the history of the Union but I want to get back to
01:29:18
my life and I think Pence Nikki heli should go for it what happens and who wins sacks too late for that too late
01:29:26
for that you can't you can't put Pence and Nikki Haley on the ballot why not of course you can if he says I'm feeling under
01:29:32
it if he bows out the Republicans would have to pick a successor it's not a new third party that the Republicans would
01:29:38
be allowed to pick a successor if he said I'm not doing it for uh you know health reasons whatever reason he comes
01:29:45
up with who wins no too silly this is silly I think he might drop out I think
01:29:51
there I'm putting out there I think it's a 5% chance he doesn't want to be demolished and he says you know what
01:29:56
I'll take the deal you agree to not prosecute me getting out of here uh I'll take it and and I Chang I changed my bet
01:30:02
to Joe Biden I've changed my bet after this after you RIS your whole net worth you Chang to Joe Biden well he's he's
01:30:09
clearly the favorite right now and the question is whether there's still time for there to be a change I mean honestly
01:30:15
I think we should stop bending on what the outcome is I think it's stupid I think what we should really be worried about is what what are we doing like
01:30:24
letting tens of millions of Americans roll off of unemployment insurance with
01:30:29
zero like the Republican Senate went on vacation it's ridiculous I mean they
01:30:35
should all be fired it's it's the craziest thing we have the biggest crisis in our lifetime if you roll up
01:30:42
the last three crises 911 do com bust and the Great Recession those three pale
01:30:47
in comparison to the magnitude of this one and these [ __ ] are going on vacation I agree with you it's
01:30:53
outrageous I I don't think partisan politics are that interesting but um I I think they will eventually pass a bill I
01:30:59
think um the the the issue on the unemployment is not that the Republicans don't support an extension of
01:31:05
unemployment but the the magnitude of the unemployment now um exceeds what workers would get if they went back to
01:31:11
work and so I think they're concerned about creating a disincentive for for work split the difference why not make
01:31:17
it $300 honestly it is such fake [ __ ] news like it's like it has been shown
01:31:22
that people then end up spending that money like I don't know if you guys saw but like there are industries that are
01:31:29
posting it's not just Facebook Amazon and Google posting meet and beats like you wouldn't believe in boating in
01:31:35
housing people are spending this money it drives GDP so whether you put 600 or
01:31:41
200 or 1,200 into people's pockets they have a proclivity to spend it they should have gotten something done TR
01:31:48
Trump trump as well as all the Republicans are up for re-election I think would just cave on this issue and and I I I think it will get done the the
01:31:55
Republicans who are opposing it are the ones who aren't up for reelection and are concerned about debt you know that's
01:32:02
the that's the uh that's the concern that all Deb matter if we go into a depression David why not the incremental
01:32:09
six weeks of unemployment put it at $300 but get something done David why are you
01:32:14
not getting something done David why is your team [ __ ] this up David yeah I don't I don't wear a Jersey
01:32:21
not on a team uh but I I think they will get something done I mean I'm not back
01:32:27
for vacation do you think they should have gone a vacation they're got their own vacation David they can't they got
01:32:32
to come back to work these guys went duck hunting instead of the taking care of the 15 million your team went duck
01:32:38
hunting in Washington DC because there obviously there's a lot of there's enough Republicans who want to get
01:32:44
something done I mean why not blame the Democrats for being too intransigent sorry what I'm saying is it's not Republicans I'm saying the entire
01:32:51
breaking your chop sacks the the entire group should not have gone on vacation
01:32:57
the entire half half half of the Congress is gone they're they not to be found where are they what what are they
01:33:04
doing that's more important maybe they're hanging out in their basement like like Biden I love you guys all
01:33:10
right everybody stay safe uh on behalf of the dictator himself bestie C the the
01:33:17
uh spack Meister himself stay safe chamal on behalf of the queen of quino the
01:33:24
freed Berger himself uh stay safe David freeberg uh
01:33:30
in whichever one of your three houses you're in right now
01:33:36
and and to Rainman he's definitely burn don't burn baby he's
01:33:43
definitely a great driver in the driveway yeah definitely still yeah he's definitely watch wner wner and of course
01:33:51
you have and of course he's still investing from Craft certainly craft funds still investing we'll see you all
01:33:56
next time on the sixth most popular podcast out of the gate we'll see maybe
01:34:01
if you tell your friends about this podcast we'll go to number one on the technology list uh love you boys stay
01:34:07
safe can't wait to play poker bye great job everybody
