00:00:00
we don't have a cold open well since you
00:00:02
guys decided to go Rogue and uh agreed
00:00:05
on a vacation week and then decided
00:00:07
Freeburg decided he would go Rogue it
00:00:08
gave me a little extra time when I was
00:00:10
whitewater rafting hold on a second
00:00:11
Friedberg did not decide to go Rogue he
00:00:14
went rogue your two peers decided to go
00:00:16
Rogue I was taking the week off they
00:00:18
both sent on the text stream we want to
00:00:20
do a show this week and I said sure I'll
00:00:22
do it I'm in yes it's fun you went wrong
00:00:25
yeah that's what I said there was no
00:00:27
vacation I agreed to you don't even know
00:00:29
your schedule you're too busy writing 30
00:00:31
tweet storms about Hunter Biden why
00:00:33
would all of a sudden there be a skip
00:00:34
week in the middle of July it's just
00:00:36
because you were off no we said
00:00:39
this on his vacation I also have to give
00:00:42
my producers a week off now and again
00:00:44
because they work into the weekend
00:00:45
editing the stuff so we're editors you
00:00:48
can just swap them out I have two
00:00:49
editors yes I gave everybody the week
00:00:50
off the point is that when one of you if
00:00:53
you had said no no is off on a given
00:00:56
week The Show Goes On that's what you
00:00:57
always say but then when you who have a
00:01:01
need to go on vacation no then you know
00:01:04
it gets canceled no what would have
00:01:05
happened was what would have happened
00:01:06
was I would have put one of my producers
00:01:08
on for that weekend I would have given
00:01:09
the other one off but because we all
00:01:10
said we were going to be off that week I
00:01:12
gave everybody off that week because I
00:01:13
said let's take advantage of this that's
00:01:14
what actually happened but that's fine
00:01:20
we're off this week we're off this week
00:01:22
and we confirmed with your teams
00:01:24
multiple times we were off this week
00:01:26
it's no big deal if you want to go 52
00:01:28
weeks a year we want to record this one
00:01:30
on Wednesday on Wednesday when everybody
00:01:32
had already been getting off I know that
00:01:33
everybody who works
00:01:37
Nick and I both responded we're off this
00:01:39
week please don't pretend like you're a
00:01:41
great boss we all know what about it I
00:01:44
know that the search will work for you
00:01:45
do not get days off but I treat the
00:01:47
people who works in your organization
00:01:50
try to my organization let's see average
00:01:52
tenure of one of your employees it's
00:01:54
like six months no no actually it's more
00:01:57
like uh four or five years right now I
00:01:59
mean I have people for five to ten years
00:02:01
now it's pretty impressive actually you
00:02:03
know what's interesting my tenure is
00:02:04
actually bimodal it's either
00:02:06
years and years and years and years
00:02:08
we're out the door one year four months
00:02:10
yes that's the way it should be either
00:02:12
you hit the notes or you don't and you
00:02:14
should know quickly there's nothing in
00:02:15
the middle yeah that's the way it should
00:02:17
be actually I was sitting by the um the
00:02:20
river I went white water rafting on the
00:02:22
um Rogue River when Friedberg went rogue
00:02:25
why am I the one who went rogue because
00:02:26
I don't like you
00:02:29
that's the reason I'm not blaming the
00:02:31
other two guys I'm friends with them
00:02:32
it's obvious uh so I'm just joking I'm
00:02:36
just joking with these three people when
00:02:38
did I become the enemy
00:02:39
[Music]
00:02:43
Rain Man
00:02:44
[Music]
00:02:51
[Music]
00:02:55
all right the big news this week is
00:02:57
inflation has eased a three percent in
00:02:59
June we'll throw up a chart here
00:03:01
it's the slowest Pace in more than two
00:03:03
years so the feds increases have worked
00:03:06
and I guess the question now
00:03:08
is are we going to have a sustained High
00:03:11
interest rate or is it going to get cut
00:03:13
slowly chamoth and Friedberg you've been
00:03:16
talking to a number of people about this
00:03:19
I think all in Summit 2023 speaker Larry
00:03:21
Summers has been pretty vocal about this
00:03:24
what's your take Freeburg yeah I mean I
00:03:26
think Larry said publicly that he thinks
00:03:28
that rates are going to need to be
00:03:29
higher for longer than what the market
00:03:31
is currently showing we talked last week
00:03:34
with Brad obviously about what the
00:03:37
market is showing rates to be and he's
00:03:38
assuming some rate Cuts will start to
00:03:40
happen in December and that's really
00:03:42
what the market is saying is going to
00:03:43
happen and Brad's point was the market
00:03:45
knows better than the forecasters but
00:03:47
Larry Summers has publicly shared that
00:03:50
he thinks that that is actually not
00:03:52
correct and you know again diversity of
00:03:55
Youth is important to understand that
00:03:58
there are structural things that are
00:03:59
happening in the world right now
00:04:00
including a decoupling from China which
00:04:02
is inflationary because
00:04:04
you know China provides cheap goods and
00:04:07
cheap manufacturing for a lot of
00:04:08
Industries and many of those Industries
00:04:10
sell to Consumers so ultimately those
00:04:12
prices are going to show up in consumer
00:04:15
costs there's an increase in energy
00:04:17
transition expenditure and security uh
00:04:21
globally and Summers has pointed out
00:04:22
that those are not free they have to be
00:04:25
funded and obviously taking on more
00:04:27
funding means you're going to have to
00:04:29
pay higher interest rates for investors
00:04:30
to provide that Capital to do that
00:04:32
funding so there are more structural
00:04:35
longer term trends that some folks in
00:04:39
The Summer's Camp have been arguing are
00:04:41
going to be driving inflation higher and
00:04:43
keep rates higher for much longer than
00:04:44
what the market is currently showing
00:04:46
and I think it's really worth noting
00:04:48
that point of view
00:04:49
particularly given how quickly the
00:04:51
market thinks rates are going to start
00:04:52
getting cut chamothy you've been talking
00:04:55
about the interest rates and that you
00:04:56
believe it'll be persistent so higher
00:04:59
for longer you're sticking with higher
00:05:01
for longer on the interest rates I
00:05:02
assume yeah I think the more important
00:05:04
thing from that jaycal is so what do we
00:05:07
do about it and I think the most
00:05:09
important point of view that I'm trying
00:05:10
to get to is where do I think
00:05:12
the equity Market is going to go and
00:05:15
you know all roads at least right now
00:05:18
look like the market is getting set to
00:05:21
go materially higher
00:05:23
and the reason isn't whether you know
00:05:25
terminal rates are at two percent or
00:05:27
three percent or three and a half
00:05:28
percent I don't think that matters as
00:05:30
much
00:05:31
what matters more are the trillions of
00:05:34
dollars that are sitting on the sideline
00:05:35
or in other defensive assets
00:05:38
that need to then pivot around and get
00:05:40
put back into growth assets once you
00:05:42
know that the worst is behind us
00:05:45
and I think that's what a market always
00:05:47
looks for before real sentiment changes
00:05:50
and what's important to note is that by
00:05:52
the time most people figure out that the
00:05:55
sentiment has changed it's already
00:05:56
actually too late and so ah I think
00:05:59
right now in the next sort of like 12 to
00:06:01
18 months is really when the bottom is
00:06:03
put into the market it's before the FED
00:06:05
starts cutting it's when rates are still
00:06:08
going to be relatively high but the
00:06:11
really astute sharp in this market
00:06:15
will get ahead of it and they will start
00:06:18
to buy what they think will be an
00:06:21
eventual rally and then it's going to
00:06:23
get supported
00:06:25
by the fact that if not enough people
00:06:26
are also long
00:06:29
you get caught on the wrong side you
00:06:31
don't necessarily have to be short you
00:06:33
just aren't long enough and what that
00:06:36
does is put pressure on your business
00:06:37
model so if you're a mutual fund or if
00:06:39
you're a hedge fund and you've missed
00:06:41
most of this rally which most people
00:06:42
have because it's really only been five
00:06:44
or six companies
00:06:47
so I think that Larry is right I think
00:06:49
that I still believe what I've said for
00:06:51
a while which is rates will be higher
00:06:52
for longer but what I didn't believe
00:06:54
before
00:06:56
was that the market was set to go up I
00:06:58
think we did a great job I think
00:06:59
literally that when I made that comment
00:07:02
November of 21 about starting to sell it
00:07:04
was the absolute top of the market yeah
00:07:06
you know that one you know that one
00:07:07
nailed it yeah
00:07:09
and I think my commentary now is that
00:07:11
we're putting in the bottom and I think
00:07:14
the market is set to go materially
00:07:16
higher even if rates
00:07:18
are persistently higher for a while just
00:07:20
to challenge you on that second point
00:07:21
the bottom really was put in maybe last
00:07:23
summer you're really speaking to the
00:07:25
psychology and the Dynamics of capital
00:07:27
allocation there are people who were
00:07:29
scared maybe and thought the bottom
00:07:31
could get much worse and they didn't
00:07:34
want to put money at play there were
00:07:36
some people who were brave enough to put
00:07:37
money in play in the last 12 months so
00:07:39
I'll give myself a pat on the back I did
00:07:41
Jay trading starting last summer and I'm
00:07:42
up whatever 25 something crazy like that
00:07:44
because I picked all the big tech
00:07:45
companies but you're saying now because
00:07:48
that's but that's a good example just to
00:07:51
pick on that the reason you did well
00:07:53
was mostly because they were oversold
00:07:55
meaning that was my first time yeah if
00:07:58
you look at those big tech companies and
00:07:59
but that's not a sustainable thing if
00:08:01
you're trying to own great companies the
00:08:03
reality is those seven companies
00:08:05
one of them Nvidia is actually firing on
00:08:08
all cylinders
00:08:09
everybody else just stopped acting like
00:08:12
a [Â __Â ] [Â __Â ] and that's not a
00:08:14
sustainable business strategy meaning
00:08:16
you know burning billions and billions
00:08:19
of dollars a quarter totally wastefully
00:08:21
with all kinds of random free stuff to a
00:08:23
bunch of entitled side projects side
00:08:25
quests and then taking that away doesn't
00:08:28
ensure long-term success for anybody all
00:08:31
it does is just tourniquets the bleeding
00:08:33
and so you have more material short-term
00:08:35
cash flow and the markets are going to
00:08:38
reward it especially in a moment where
00:08:40
it's the trade-off is against rates
00:08:42
short-term rates that are five or six
00:08:43
percent but from here
00:08:45
right the real long-term value creation
00:08:49
is still going to go to the companies
00:08:52
that are building true product Market
00:08:53
fit and product value and are and are
00:08:57
really growing in a material way from
00:08:59
adoption and usage not from cost cutting
00:09:02
because people see through that and when
00:09:05
rates start to get cut they'll see
00:09:07
through it even faster the only time
00:09:10
cost cutting gets rewarded is when
00:09:12
short-term rates are this High because
00:09:14
people love short-term cash flow yeah
00:09:15
and it was when the The Moment I Saw
00:09:18
Zuckerberg and Airbnb Uber other places
00:09:21
just start and obviously Google and
00:09:23
Microsoft start making Cuts you're like
00:09:24
okay people are going to lower their
00:09:26
costs they're doing triage as you're
00:09:28
saying to make the balance sheet to make
00:09:30
the origins works in the final third of
00:09:32
a bear Market okay so but triage does
00:09:34
not work in a bull market you don't get
00:09:37
rewarded for triageable Market I totally
00:09:39
get it you have to innovate you have to
00:09:40
build great products so sax when you're
00:09:42
looking at the overall Market I think we
00:09:44
talked about the average
00:09:45
recession or downturn is six quarters
00:09:48
plus or minus one or two historically we
00:09:51
are entering the seventh quarter of the
00:09:53
downturn at least in Tech started by
00:09:55
attacking the first quarter of 2022 here
00:09:57
we are in the third quarter starting in
00:10:00
July of 2023. what's your take on what
00:10:03
the next six quarters look like are we
00:10:04
going to be sideways or are we going to
00:10:06
estimate saying hey there's a lot of
00:10:08
people are trying to pay ketchup they
00:10:10
missed this bump and now they're
00:10:12
competing and they have to at the end of
00:10:13
the year Capital allocators are going to
00:10:15
show in their yearly reports what they
00:10:17
did this year and now they're like hey
00:10:19
we got to put some some bets into some
00:10:20
high growth companies is this the setup
00:10:22
for another Mania and uh maybe unhealthy
00:10:25
Behavior so Jason I don't think it's
00:10:27
gonna be a Mania but I do think that the
00:10:30
market is ripping today because the
00:10:32
market is basically pricing in the idea
00:10:34
of a soft Landing along with inflation
00:10:36
being tamed so you had to pause the CPI
00:10:38
report at three percent you had a hot
00:10:40
jobs report a week or two ago and
00:10:42
there's a interesting article in the
00:10:44
Wall Street Journal today talking about
00:10:45
the odds of a soft Landing improving
00:10:48
and they have some data for that I don't
00:10:50
particularly agree with the sub headline
00:10:51
they're trying to latest data suggests a
00:10:53
lot of past inflation was transitory
00:10:55
that seems yeah that I think is is being
00:10:58
too charitable to the fact because when
00:11:01
they use the word transitory they were
00:11:03
using as an excuse not to raise interest
00:11:05
rates and we just had the fastest rate
00:11:07
tightening cycle ever over the past year
00:11:10
that's the reason why inflation has gone
00:11:13
down it was not transitory until they
00:11:15
jacked up interest rates from zero to
00:11:16
five percent so the Wall Street Journal
00:11:19
I think is doing a little covering for
00:11:21
the FED there but nonetheless I think
00:11:22
everybody is pleasantly surprised that a
00:11:26
CPI is now down to three percent and B
00:11:29
you have not had a significant cooling
00:11:32
of the jobs market so certainly the odds
00:11:34
now of a soft Landing have gone up and
00:11:37
the thing that's sort of surprising
00:11:39
about what Larry Summers is saying is
00:11:42
that if you believe that inflation is
00:11:45
going to come roaring back that's
00:11:46
certainly a contrarian bet that's not
00:11:48
what the market is saying right now what
00:11:50
the market is predicting right now and
00:11:51
and the reason why stocks are rallying
00:11:53
is what the market is thinking is well
00:11:56
if inflation's down to three percent we
00:11:57
can end the year at three or even lower
00:12:00
then the FED can start cutting next year
00:12:02
and so they're starting a price in rate
00:12:05
Cuts but if inflation comes roaring back
00:12:07
you're not going to get rate cuts and so
00:12:09
stock prices are going to go down I
00:12:11
don't see how you can have a scenario of
00:12:13
even higher interest rates from here
00:12:15
along with higher stock prices I think
00:12:18
you need lower rates to get higher stock
00:12:20
prices and one of Brad's charts shows
00:12:23
this if you look at the software index
00:12:25
the median
00:12:28
Enterprise Value divided by next 12
00:12:30
months Revenue what you see here is that
00:12:34
the mean
00:12:35
multiple is 7.7 excluding the covid
00:12:38
Distortion we're at 6.6 now so there is
00:12:41
room
00:12:42
for the software index to run up pretty
00:12:46
nicely here you could argue that's super
00:12:48
valued or fairly valued you see the 10
00:12:51
years of 3.8 percent if you compare it
00:12:53
to where we were before covid when
00:12:55
interest rates were in the mid twos to
00:12:59
around three percent yeah we got to an
00:13:01
18x multiple it was crazy yeah so so
00:13:03
basically if interest rates go down I
00:13:06
think for sure you'll see multiples go
00:13:08
up and I think if interest rates going
00:13:10
to keep going up from here then you're
00:13:12
not going to get that Rally or I don't
00:13:13
see why you would well the thing to keep
00:13:15
in mind is I think this chart is not
00:13:17
that helpful because this is all
00:13:19
unprofitable software companies so I
00:13:22
think the more important thing is to
00:13:23
look at the broad-based index
00:13:25
the thing with these companies is that
00:13:27
even if rates are at three percent or
00:13:29
six percent or two percent or one
00:13:31
percent
00:13:32
that
00:13:33
trick is over these companies are not
00:13:36
going to get out of this cul-de-sac
00:13:37
until they figure out true product
00:13:39
Market fit how to eliminate churn how to
00:13:41
drive medium to long-term profitability
00:13:43
and most of them unfortunately don't
00:13:45
have a clear path to that and the
00:13:48
problem is all of the old Legacy
00:13:50
software companies X of Salesforce have
00:13:54
still not gotten to profitability so
00:13:55
meaning the ones that went public in
00:13:56
like the early teens are still sucking
00:13:59
wind losing money so the idea that
00:14:02
software businesses generate long-term
00:14:04
profits is so far unfortunately been a
00:14:06
fallacy so that chart I think will stay
00:14:08
exactly the same way it is I think the
00:14:11
bloom is off the roads but where the
00:14:13
money can go it would change that though
00:14:15
because we need to stop at this point to
00:14:17
look talk at these SAS companies because
00:14:18
what would change that if they actually
00:14:19
get to profitability and sex what's the
00:14:21
chances they get to profitability
00:14:22
because that would make them look more
00:14:24
like Microsoft or the biggest problem
00:14:26
that software as a service businesses
00:14:28
have is the same thing that it benefits
00:14:30
from which is cycle time so the cycle
00:14:33
time for a Fast Business to build a
00:14:35
feature set to get product Market fit
00:14:37
and to get early revenue is very short
00:14:40
the problem with that is that is the
00:14:42
equivalent amount of time it takes for a
00:14:44
competitor or several competitors to
00:14:46
compartmentalize and chop and slice and
00:14:48
dice that feature set into a bunch of
00:14:50
smaller subscale SAS products that then
00:14:52
go after it and cannibalize that Revenue
00:14:54
so I think the issue that they have is
00:14:56
they show contractually
00:14:59
a lot of Revenue expansion that looks
00:15:02
good on the service but underneath these
00:15:05
guys are in this constant hamster wheel
00:15:07
of trying to build features and trying
00:15:09
to keep their head above water and all
00:15:11
of that treading
00:15:13
consumes enormous amounts of cash and so
00:15:16
from an Opex perspective the SAS
00:15:18
businesses
00:15:19
they just suck they don't generate free
00:15:21
cash flow except for a few let me let me
00:15:24
bring sax into the sex do you think that
00:15:26
these companies will get to having a p e
00:15:29
ratio because a lot of times you'll pull
00:15:30
them up and it's like price earnings
00:15:31
ratio not applicable for this company
00:15:33
because there are no earnings and you've
00:15:35
dedicated and you built a billion dollar
00:15:37
company so give us the other side
00:15:39
the other side of it is that software
00:15:42
businesses have great gross margins I
00:15:44
mean you spend all of your r d creating
00:15:45
the first instance of the product and
00:15:47
they're they're after every additional
00:15:49
instance of the product is basically
00:15:50
almost free to provision on the margin
00:15:52
so these are super high margin
00:15:54
businesses
00:15:55
once you achieve dominance in your
00:15:57
category there's a bunch of different
00:15:59
modes you can create a platform you have
00:16:01
the largest sales and marketing
00:16:03
operation
00:16:05
everyone wants to go with the market
00:16:07
leader
00:16:08
so there's
00:16:10
you know a bunch of different ways to
00:16:11
lock in your advantage and not all those
00:16:13
companies are losing money a growing
00:16:15
number of them are making money I just
00:16:16
think that's like a sweeping over
00:16:17
generalization got it so I still think
00:16:19
software businesses are some of the best
00:16:21
businesses
00:16:24
we're off on a little bit of a tangent
00:16:26
here which is I could have shown you a
00:16:29
slide of almost any basket of gross
00:16:32
stocks yeah and you would have had
00:16:34
something similar which is they're still
00:16:37
trading below their seven year mean on a
00:16:40
multiple basis and so my point was
00:16:43
simply that if interest rates are coming
00:16:45
down there is room for these stocks
00:16:47
today you're right about that yeah let
00:16:49
me bring free Bergen freeberg in the
00:16:51
Summers camp and some other people's
00:16:53
Camp they believe interest rates have to
00:16:55
go higher despite the fact that
00:16:58
inflation has plummeted and it feels
00:16:59
like a for pal that this is a mission
00:17:02
accomplished moment the reasons they
00:17:04
believe that are the infrastructure and
00:17:06
chips Bill are going to pour money into
00:17:08
the United States and we're gonna have
00:17:09
massive spending we already have absurd
00:17:12
50-year low unemployment
00:17:15
which is insane we still have close to
00:17:18
10 million job openings we have locked
00:17:20
the borders we now have Democrats and
00:17:23
Republicans back to back saying we're
00:17:24
not going to let people into the country
00:17:26
we've so I don't know who's going to
00:17:28
work in all these factories if we don't
00:17:29
have an immigration policy so maybe you
00:17:31
could tell us if you actually believe
00:17:33
this sort of let's call it the Summers
00:17:35
Doctrine here or the the contrarian
00:17:37
Summers position
00:17:39
six seven percent
00:17:41
interest rates are coming because we're
00:17:44
going to have
00:17:45
persistent inflation
00:17:48
and if you believe that contrary I think
00:17:50
there's a general statement that can be
00:17:52
made that we are coming out of a zero
00:17:56
interest rate environment into which
00:17:59
lasted for a very long period of time
00:18:04
into a a very stimulatory environment
00:18:07
because of
00:18:10
government spending
00:18:12
and when you have
00:18:14
government spending stimulating the
00:18:17
economy you have a natural Market Force
00:18:19
of
00:18:20
inflation coming from the additional
00:18:23
Capital being pumped into the economy
00:18:25
and the purchasing and and all that sort
00:18:28
of stuff like you pointed out 50-year
00:18:30
low in unemployment and we're trying to
00:18:32
create a bunch of new jobs and who's
00:18:34
going to fill those jobs you're gonna
00:18:36
have to pay people more to get them to
00:18:37
take both jobs so you know you're going
00:18:39
to see a rising wages and then can I ask
00:18:42
you a question as a follow-up to that
00:18:44
Free Break you pay people more but
00:18:46
there's nobody looking for jobs
00:18:48
we're kind of that's I think the
00:18:51
conundrum we're in people don't want to
00:18:52
you can boost the labor participation
00:18:54
rate right you can attract more people
00:18:55
to the workforce yeah and it drives wage
00:18:57
growth But ultimately keeping this in
00:18:59
mind so the lower wage workers let's use
00:19:01
a simple example people that work in
00:19:03
fast food their if their rates go from
00:19:05
you know eight bucks to 15 bucks to 25
00:19:08
bucks an hour the cost of fast food goes
00:19:10
up so on the food price index you'll see
00:19:13
a rise in in food prices so right now it
00:19:16
seems like the fed and the market are
00:19:18
all acknowledging and reacting to you
00:19:21
know these these
00:19:23
I don't I would kind of argue acute
00:19:26
conditions that are that are being
00:19:27
resolved from coming out of the covid
00:19:29
stimulation but there are in place as
00:19:32
the comments have been made increased
00:19:34
spending to Nato because of Global
00:19:36
Security concerns increased defense
00:19:38
spending globally the current projection
00:19:40
from the CBO showing what defense
00:19:42
spending is going to be as a percentage
00:19:44
of GDP or percentage of government
00:19:45
spending there are some folks as you
00:19:47
guys all know well who you would speak
00:19:49
to in DC who think that those numbers
00:19:51
are BS because we're going to increase
00:19:53
defense spending not cut it
00:19:56
because of Global Security concerns
00:19:58
particularly as we decouple from China
00:20:00
and all of the energy transition stuff
00:20:02
the IRA the chips act which is a
00:20:04
security thing these are all stimulatory
00:20:06
so the tides come in and out but the sea
00:20:08
levels are rising and over time that
00:20:11
translates into a way to manage
00:20:13
the inflation but also to raise the
00:20:16
capital which means you have to pay
00:20:18
higher rates uh and this is this is in
00:20:20
the EU and the U.S that it seems this is
00:20:23
going to be the case so
00:20:25
I feel like we've gone in a circle a
00:20:27
little bit which is good I think just to
00:20:29
show how complex the issue is I mean
00:20:30
we're trying to predict the weather here
00:20:32
or at least understand the weather
00:20:33
patterns so let's talk about the driving
00:20:35
force in this in CPI the first word is
00:20:38
consumer chamoth
00:20:40
stemi check summer last year and the
00:20:42
year before nft crypto you know secure
00:20:45
your bag summer I think it was this the
00:20:48
same sort of phenomenon
00:20:50
and unlimited you know double or triple
00:20:54
bonus unemployment plus deferring your
00:20:57
student loans those four things were you
00:21:00
know pretty much defined in the last two
00:21:01
years and all of them have come to a
00:21:03
crashing halt you can't get unlimited
00:21:04
unemployment you got to start paying
00:21:06
your student loans in September from my
00:21:08
understanding
00:21:12
oh yeah oh wow what a crazy concept
00:21:16
so we have five factors there you have
00:21:18
to you have to pay your landlord your
00:21:19
rent so let's talk about the consumer
00:21:21
for a quick second here is this the last
00:21:24
hurray summer people consumers are going
00:21:27
to need to get back to work in September
00:21:28
because it seems like the credit card
00:21:30
debt's going up we talked about that
00:21:31
over the last year and if consumers
00:21:33
aren't spending
00:21:35
you know that's going to be the driving
00:21:36
force and that was the goal of raising
00:21:38
the interest rates is to maybe get
00:21:40
consumers to have a higher car bill a
00:21:43
higher mortgage Bill and to get back to
00:21:46
work yeah I mean I think that's very
00:21:47
well summarized I think that we
00:21:50
um are absorbing all the excess
00:21:53
liquidity
00:21:54
in the economy that would otherwise have
00:21:56
gone into really speculative things
00:22:00
the extra vacation the extra pair of
00:22:03
shoes on
00:22:05
stockx or whatever the extra nft the
00:22:08
extra this the extra that that's all out
00:22:10
the window
00:22:12
a traditional home mortgage is probably
00:22:14
doubled in terms of your monthly payment
00:22:16
so yeah people will be forced to get
00:22:17
back to work they'll have to stay in
00:22:20
jobs longer they'll have to
00:22:24
just do a much better job of managing
00:22:26
their finances
00:22:28
but all of that doesn't necessarily mean
00:22:30
that the U.S economy falls off a cliff I
00:22:32
think that the thing we have to remember
00:22:34
is that
00:22:36
and I don't think we can explain it
00:22:37
actually
00:22:38
very well because every time an
00:22:40
economist has tried to do it I don't
00:22:42
think they've really figured this out
00:22:43
but we tend to have a very resilient
00:22:46
level of consumer demand
00:22:48
and when you look at the correlation
00:22:52
between consumer demand and the
00:22:53
underlying economy even in periods of
00:22:55
extreme shock so even like the pandemic
00:22:57
is one of those moments where yeah the
00:22:59
demand fell off a cliff but that's
00:23:01
because we were literally prevented from
00:23:03
doing anything we could not buy the
00:23:05
things that we wanted to right or if you
00:23:07
even go back to 2007 2008 in the great
00:23:10
financial crisis the interesting thing
00:23:12
about consumer demand is that it snaps
00:23:15
back very quickly so there's this weird
00:23:17
dynamic where folks have a base level of
00:23:20
spending and
00:23:22
they use an amount of debt to basically
00:23:24
you know subsidize that
00:23:27
and then they're willing to work in
00:23:29
order to make sure that that doesn't
00:23:30
change and I think that that's what
00:23:32
we're getting back to we're going to get
00:23:33
people
00:23:34
off the sidelines into the labor market
00:23:36
and yeah I think it will keep going sex
00:23:40
I think it's all psychology like if
00:23:41
you're
00:23:42
I think people spending is a function of
00:23:45
their optimism and like maybe their last
00:23:47
trade yeah or their last bank statement
00:23:49
so it's like oh my nft tripled therefore
00:23:52
it's going to Triple again next month
00:23:53
and hey there's a chance at micro 10x oh
00:23:56
I invested in the startup oh you know
00:23:57
I'm getting stimmy checks I'll get
00:23:59
another stimi check and now if they get
00:24:01
three or four moments in time where oh
00:24:04
my nft is now worth 10 I can't defer my
00:24:07
student loans anymore oh I'm a curing
00:24:09
interest oh no the house I bought now
00:24:11
has a 15 mortgage and I was on variable
00:24:14
so what's your thoughts on the
00:24:17
psychology of the consumer here and is
00:24:19
everybody just still spending but maybe
00:24:20
downgrading a little bit maybe they buy
00:24:22
the Tesla Model three instead of the you
00:24:25
know going for the model S they take
00:24:27
business class instead of taking
00:24:28
business class or economy plus they do a
00:24:30
staycation and drive somewhere
00:24:32
I've been surprised at this how
00:24:34
resilient the economy has been
00:24:36
I figured that after all the distortions
00:24:39
we had in the economy all the stimulus
00:24:40
during covet we basically floored the
00:24:42
accelerator and then slammed on the
00:24:43
brakes with this incredibly rapid rate
00:24:46
tightening cycle I thought for sure that
00:24:48
was going to basically crash the economy
00:24:50
I was in the drucken Miller camp on this
00:24:53
but I think again what you're seeing
00:24:55
over the last few weeks is just more and
00:24:57
more evidence that it could be a soft
00:24:58
Landing
00:24:59
that we may not have a recession and
00:25:02
we might even get rate Cuts next year
00:25:04
but I do think that right now the risks
00:25:06
are probably as balanced as they've been
00:25:08
so if you want to pull up Nick can you
00:25:10
pull up that chart the quadrants from
00:25:12
the CO2 Summit I thought this was
00:25:13
actually a pretty interesting chart that
00:25:15
we saw at the kotu summit as a useful
00:25:18
framework for thinking about the
00:25:19
scenarios for the economy
00:25:21
audience listening Yeah Yeah so
00:25:24
basically it's a two by two quadrant
00:25:26
where on one axis you've got inflation
00:25:27
and inflation can be either low or high
00:25:30
based on three percent being the
00:25:32
dividing line and then the economy can
00:25:34
be either weak or strong with four and a
00:25:36
half percent unemployment being the
00:25:37
dividing line so if you believe that
00:25:39
inflation's coming down below three
00:25:41
percent and unemployment is going to
00:25:44
stay below four and a half percent
00:25:46
I think it's already at like three and a
00:25:48
half percent right now then you're back
00:25:50
in the sustained growth quadrant in
00:25:53
which case the S P 500 is going to keep
00:25:54
ripping on the other hand if inflation
00:25:58
is above three percent with low
00:26:00
unemployment you're back in the
00:26:01
overheating quadrant which is probably
00:26:03
bad for stocks now you could have a
00:26:05
situation in which inflation goes down
00:26:09
and remains good but unemployment goes
00:26:11
way up in which case that'd be the hard
00:26:12
Landing and then the final quadrant is
00:26:15
stagflation where you've got high
00:26:16
inflation and high unemployment so
00:26:19
I think the quadrants right now are
00:26:21
probably as balanced as they've been in
00:26:22
quite some time in terms of where we
00:26:24
could end up in let's say a year yeah I
00:26:26
think that yeah there's some early
00:26:29
signals
00:26:31
that you can look to to get a sense of
00:26:33
where this may be going Disney World is
00:26:36
empty the lines are really short I don't
00:26:38
know if you guys have any friends that
00:26:39
have been to Disney World lately or
00:26:40
Disneyland it was in the Wall Street
00:26:42
Journal the traffic has fallen off a
00:26:43
cliff yeah and
00:26:48
that's a really interesting point is do
00:26:51
you think that Disney traffic
00:26:53
has gone down because the conservative
00:26:56
half of the country basically feels
00:26:57
offended
00:26:59
Bud Light yes or is it a larger consumer
00:27:02
special problem everybody everywhere
00:27:03
else is still spending like even if you
00:27:05
go to like look at the World Series of
00:27:07
Poker main event this year had the
00:27:10
historic number of entries everything is
00:27:12
telling you that people are getting
00:27:13
their last hurray so the fact that
00:27:15
Disney has been decaying for the past
00:27:17
year is more emblematic of the fact that
00:27:20
they've gotten into this social culture
00:27:22
war and half the population of America
00:27:24
said we're not going to support your
00:27:25
business like they did to Bud Light and
00:27:27
I'm not adjudicating the rightness or
00:27:29
wrongness of either Bud Light or Disney
00:27:31
but the answer is in the actual results
00:27:34
the people are not walking into the
00:27:36
store just to show this it's while we're
00:27:38
on Disney so here's a Disney chart for
00:27:39
you just to show you the times at the
00:27:41
different Parks over the years it is in
00:27:43
2023 meaningfully shorter than 2022 or
00:27:47
pre-pandemic so I don't know if that's a
00:27:49
function of their technology that
00:27:50
they've been deploying or if maybe
00:27:52
conservatives are not outgoing but
00:27:54
there's also another X Factor which is
00:27:56
the previous
00:27:57
head of Disney who got ousted and Bob
00:27:59
iger's back was the guy who ran parks
00:28:02
and he just leaned into changing the
00:28:06
pricing and it got absurdly expensive
00:28:07
and they got rid of like the California
00:28:09
pass and all that stuff so I think the
00:28:11
the jury is out on this one Bob chapek
00:28:13
yeah but there's a broader consumer
00:28:15
spending question that I'm I'm saying
00:28:17
there may be some early signals most
00:28:18
consumers rely on credit as you guys
00:28:20
know interest rates are rising and that
00:28:21
passes through to Consumers purchasing
00:28:23
Goods but other folks look at the metric
00:28:25
of consumer credit card balance as a
00:28:28
percentage of savings or percentage of
00:28:30
earnings which is actually a little bit
00:28:32
lower given wage growth and savings that
00:28:34
have accumulated regardless there are
00:28:36
other signals we can look to so if you
00:28:37
pull up this chart this just shows a
00:28:40
really important uh statistic so 80
00:28:43
percent of new car purchases are
00:28:45
financed meaning you take out a loan to
00:28:48
buy the car 40 percent of used cars are
00:28:51
financed and interest rates on car loans
00:28:54
as you guys can see in this chart in
00:28:56
just the last year or so it interest
00:28:58
rates have spiked from under four
00:29:00
percent called 3.7 percent to an average
00:29:03
of seven percent today and that
00:29:05
obviously translates into a doubling of
00:29:08
the monthly payment needed to buy a car
00:29:11
and now if you go to the next image so
00:29:13
this is now playing through in terms of
00:29:16
Youth card demand and used car prices in
00:29:19
the last month it was reported by Cox
00:29:21
Automotive that the pricing for used
00:29:23
cars has declined by 4.2 percent and so
00:29:27
this starts to indicate that there may
00:29:28
be a bit of a softness emerging we could
00:29:31
argue yes this is having a positive
00:29:33
effect on the inflationary conditions
00:29:34
but it may also be an indication of
00:29:36
consumer spending and that we're
00:29:37
starting to get to a point where credit
00:29:39
is so expensive and consumers ability to
00:29:41
flex credit is being decreased and
00:29:44
that's starting to translate through
00:29:45
into what everyone's been worried about
00:29:46
which is the recessionary or declining
00:29:48
effect on Revenue declining effect on
00:29:50
profit of companies that are selling
00:29:52
goods and services so that is obviously
00:29:54
the challenge to Sax's point on that two
00:29:56
by two Matrix on you know if you if you
00:29:59
reduce cost and reduce demand too much
00:30:01
you can have a recessionary effect and
00:30:03
consumers are a big driver of this and
00:30:05
so many consumers depend on credit it's
00:30:07
a it's going to be a big condition to
00:30:09
watch well austerity measures
00:30:11
are going to happen here's the chart of
00:30:14
quarterly revenue for uh Disney yeah
00:30:16
still doing great I bought the stock and
00:30:18
it's it's the one thing in my J trading
00:30:20
portfolio I've gotten crushing on that
00:30:21
and Warner Brothers Discovery I made two
00:30:23
entertainment bets and what I think are
00:30:24
the two best companies I also did
00:30:26
Netflix but
00:30:27
one out of three ain't good
00:30:29
all right so some breaking news here
00:30:31
that we'll try to dovetail together with
00:30:34
this
00:30:35
Lena Khan and the FTC losing their
00:30:38
Activision case apparently and it's
00:30:40
breaking news a partial win is what it
00:30:43
looks like let me read this here judge
00:30:44
gives Ripple partial win an SEC case
00:30:47
over xrp currency Ripple Labs Inc
00:30:50
violated Federal Securities Law in its
00:30:51
sale of cryptocurrency xrp directly to
00:30:53
sophisticated investors but it sells on
00:30:56
public exchanges did not involve
00:30:58
Securities a U.S judge said in a ruling
00:31:00
that sent the cryptocurrency soaring xrp
00:31:02
was up 25 after the ruling
00:31:05
SEC had accused the company and its
00:31:07
current and former Chief Executives
00:31:09
conducting a 1.3 billion dollar
00:31:10
unregistered security offering by
00:31:12
selling xrp which ripples Founders
00:31:14
created in 2012 U.S District
00:31:17
judge who is based in New York on
00:31:19
Thursday said the company is 728.9
00:31:22
million of xrp sales to hedge funds and
00:31:24
other sophisticated buyers amounted to
00:31:26
unregistered sales of securities
00:31:28
but Torres ruled xrp sales on public
00:31:33
cryptocurrency exchanges were not offers
00:31:35
of Securities under the law because the
00:31:38
purchases did not have a reasonable
00:31:39
expectation of profit tied to Ripple's
00:31:41
effort okay those cells were blind bid
00:31:45
ass transactions she said where the
00:31:48
buyers could not have known if their
00:31:49
payments I'm reading from
00:31:51
Reuters here of money went to Ripple or
00:31:53
any other seller of xrp interesting so
00:31:56
the buyer becomes the
00:31:58
the person who profits from it becomes
00:32:00
the the fulcrum here xrp cells on
00:32:02
cryptocurrency platforms we're not going
00:32:04
to figure this out in real time this is
00:32:05
too complicated the bottom line is that
00:32:08
the headline is I just want to make sure
00:32:10
the audience gets it yeah look the
00:32:12
headline is I mean the Tweet Ripple
00:32:14
sales of xrp do not constitute offer
00:32:16
investment contracts according to judge
00:32:18
they won this is a huge Vindication for
00:32:22
them and that xrp is ripping 35 percent
00:32:24
yeah and it really handcuffs the SEC
00:32:27
what are they going to do about coinbase
00:32:30
and every other exchange I mean if
00:32:33
they're not selling securities I think
00:32:34
coinbase and everybody else has always
00:32:36
maintained they're selling tokens this
00:32:38
is the this was the fulcrum argument for
00:32:40
the SEC and they just they just lost
00:32:42
the whole crypto Market is ripping right
00:32:44
now it's an interesting one the
00:32:45
confounding part of this is that the
00:32:47
initial sale two accredited investors
00:32:49
and hedge funds was done
00:32:51
that they violated Security's law there
00:32:53
when they were selling directly to
00:32:54
sophisticated investors I just looking
00:32:56
at it logically you would think it was
00:32:58
the reverse
00:32:59
but this is a fascinating turn of events
00:33:01
I just texted with Brad garlinghouse and
00:33:03
he says um yes it does mean that they
00:33:06
won and he feels Vindicated Vindicated
00:33:10
and really happy
00:33:14
well I feel like I'm going to launch J
00:33:17
coin and sell a token to back startups I
00:33:20
mean if if it's a free-for-all I won't
00:33:22
tell you what he says
00:33:24
no I mean you aren't using these guys as
00:33:28
a Security fraud for like I think
00:33:29
several years they've been convicted of
00:33:31
Securities fraud here so that's the
00:33:33
that's a two-part judgment
00:33:34
Ripple violated Federal Securities Law
00:33:36
in itself cryptocurrency the first line
00:33:38
of the story there's two judgments here
00:33:40
they violated Federal Securities are in
00:33:42
sale of cryptocurrency actually be
00:33:43
directly to sophisticated investors but
00:33:46
the sales on public exchanges did not
00:33:48
involve Securities so what they're
00:33:49
saying is if you sold xrp to hedge funds
00:33:52
that was a security when they did the
00:33:54
first offering but when the public
00:33:56
started trading it on public exchanges
00:33:58
they did not have according to the Howie
00:34:01
test
00:34:02
this belief that's where their
00:34:04
vulnerability was because if you sell to
00:34:06
a professional hedge fund they're
00:34:07
accredited that should not be an issue
00:34:10
you should be able to sell to it right
00:34:11
so what's the problem
00:34:13
for them the judge says they sound
00:34:15
pretty happy and the market seems to be
00:34:17
indicating that this is I mean would you
00:34:19
say the price is up 35 percent
00:34:21
well I mean the public 37 right now
00:34:24
crypto trades I wouldn't necessarily put
00:34:26
too much on it I would look at the the
00:34:29
actual judgment here but we all know
00:34:31
people trade headlines so let's let's
00:34:32
see where it's at in five days but a
00:34:34
bunch of the all coins are ripping right
00:34:35
now
00:34:36
oh boy here we go it's a judgment that
00:34:38
seems to indicate for a lot of folks
00:34:40
that these are not going to be treated
00:34:41
as Securities I think that this is a
00:34:42
really important
00:34:44
just think about how amazing the United
00:34:46
States is that the government
00:34:49
agencies the administration in power can
00:34:52
come after corporations and then we have
00:34:54
a court system that can adjudicate and
00:34:56
make decisions that follow the rule of
00:34:58
law I know we're going to talk about
00:34:59
Lena Khan and her agency's efforts at
00:35:03
litigation but I'm really encouraged at
00:35:06
the fact that the court system in the
00:35:08
United States doesn't just kowtow to
00:35:11
whatever Administration is in power at
00:35:14
that moment that they do adjudicate by
00:35:15
the law and ultimately provide greater
00:35:18
Clarity for business for individuals to
00:35:21
operate going forward that there is a
00:35:23
better sense now for the market there's
00:35:24
a better sense now for individuals
00:35:27
have they always well it's a check and
00:35:29
balance I think that's what's so great
00:35:31
is that there's now Clarity because the
00:35:33
courts provided that yeah has this trend
00:35:36
changed I thought they I thought America
00:35:37
always did that yeah I think it's great
00:35:39
I think it's look because you you
00:35:41
obviously have a very zealous
00:35:43
Administration and a very zealous agency
00:35:46
leader who is testing the boundaries and
00:35:49
you know Lena Khan's agency is pushing
00:35:50
the limits on what constitutes antitrust
00:35:54
and in the effort to try and push those
00:35:56
boundaries there's a pushback from the
00:35:58
courts Ben Gensler in the SEC I'm sorry
00:36:02
yeah but but both agencies right
00:36:05
and so it's good to see that there's
00:36:07
Clarity emerging and that the courts do
00:36:08
their job and that the administrations
00:36:10
come in and I think the least thing is
00:36:12
yeah very different I think this was a
00:36:14
nuanced argument that the SEC made that
00:36:17
required a highly sophisticated
00:36:19
interpretation of Securities Law and
00:36:22
you're supposed to go to the courts for
00:36:23
that
00:36:25
I think what the FTC has been doing is
00:36:28
basically
00:36:30
just emotionally reactive lawsuit filing
00:36:33
all right so let me just pivot over to
00:36:34
Lena Khan's losing streak here on
00:36:37
Tuesday Morning a federal judge denied
00:36:38
the ftc's attempt to delay Microsoft's
00:36:40
70 billion dollar acquisition of
00:36:42
Activision Blizzard and the ftc's
00:36:45
argument is basically Microsoft should
00:36:46
not be a lot require Activision because
00:36:47
it would make Activision score assets
00:36:49
which is basically Call of Duty uh one
00:36:51
of the greatest franchises in the
00:36:52
history of franchises
00:36:54
movies or television shows or video
00:36:58
games and that it would be exclusive to
00:37:00
the Xbox Satya Nadella and Xbox had Phil
00:37:02
Spencer both said under oath they could
00:37:05
not make Cod and exclusive and they
00:37:07
wouldn't and not only that they said
00:37:08
they would allow it no it made no sense
00:37:11
I mean they also said they would put it
00:37:12
on Nintendo the chorus because Sony
00:37:16
because Nintendo and Sony are the other
00:37:18
number one and number two players in
00:37:20
this market and Sony alone is basically
00:37:22
50 of the market so I think like the
00:37:26
crazy thing about all of this is if you
00:37:28
look at the the legal strategy
00:37:32
of the FTC it's basically that they view
00:37:36
themselves as a hammer and every deal
00:37:39
particularly if it's done by big Tech is
00:37:41
a nail
00:37:42
and so you know Amazon Roomba lawsuit
00:37:46
Facebook some random little company
00:37:49
lawsuit Microsoft Activision lawsuit and
00:37:52
it's that emotional reactivity
00:37:56
that takes away
00:37:58
faith and trust that this organization
00:38:00
is intelligent
00:38:02
and sober and well run and that's the
00:38:05
shame of it because if you actually look
00:38:08
across all of the deals in Tech that
00:38:09
have happened recently this deal was
00:38:12
frankly DOA from the start from a
00:38:15
regulatory blocking perspective because
00:38:16
of what I just said the number three
00:38:19
player a distant third
00:38:21
buying an asset why would you take an
00:38:24
asset that you pay 70 billion dollars
00:38:25
for and immediately turn it off from 50
00:38:27
of all consoles nobody would do that hey
00:38:30
sax when we look at this and let's widen
00:38:33
this aperture to the faith in
00:38:35
institutions because we have the Gary
00:38:36
Gensler hey do we actually believe that
00:38:40
they're acting in good faith or are they
00:38:41
trying to protect fiat currency
00:38:43
and not let an alternative currency take
00:38:46
some control and and sort of be a
00:38:49
backstop against their behavior in the
00:38:50
money printing machine which is cryptos
00:38:52
you know big sort of let's call it the
00:38:54
biology position and then in this case
00:38:56
Lena Khan was selected hand-picked as a
00:38:59
32 year old Wonder kid
00:39:01
who had this incredible thesis that she
00:39:03
could predict who would compete in the
00:39:05
future she was like a Minority Report
00:39:07
precog she alone could decide
00:39:10
you know who how these uh competitions
00:39:13
would emerge and she keeps losing so
00:39:16
these two institutions now being used
00:39:18
for political purposes
00:39:20
by the Biden Administration or do you
00:39:23
think that they're just poorly executing
00:39:25
what's your take
00:39:27
well I think clearly the legal strategy
00:39:30
that Lena Khan has been pursuing is not
00:39:32
having much success in the courts I mean
00:39:34
she just lost this big decision on the
00:39:36
Microsoft acquisition of of Activision
00:39:39
but that being said I'm almost starting
00:39:41
to feel bad for her because although
00:39:43
some of her legal theories may be flawed
00:39:45
I do think that these big tech companies
00:39:48
like Google and Microsoft do need a
00:39:49
check on their power and so what I would
00:39:52
urge is that Lena Khan needs to regroup
00:39:54
maybe figure out a different legal
00:39:57
strategy figure out a different way to
00:39:58
take on big tack because someone does
00:40:00
need to cut these big tech companies
00:40:02
down to size
00:40:03
they are giant monopolies and they do
00:40:05
need to be restrained and controlled or
00:40:07
they will basically consolidate the
00:40:09
whole Tech ecosystem and abuse their
00:40:11
Market power so I think it's actually
00:40:13
pretty vital that we have a regulator
00:40:15
who is energetic in wanting to check the
00:40:18
power of big Tech I think maybe
00:40:21
trying to put a damper on M A was the
00:40:24
wrong way to do it we've talked about
00:40:25
this before it needs to be more surgical
00:40:27
right there's so few ways to have a good
00:40:28
exit in the tech industry that when you
00:40:31
take away M A it puts a damper on all
00:40:34
risk-taking and the deployment of risk
00:40:37
Capital into the ecosystem so I think it
00:40:39
was having too big of a chilling effect
00:40:40
so I think she needs to
00:40:43
move away from these M A cases unless
00:40:47
it's a very very clear case but I think
00:40:50
where she can be more aggressive is on
00:40:52
restraining anti-competitive tactics and
00:40:55
also maybe busting up these companies
00:40:56
you know I'm thinking more and more
00:40:58
about this Google case that she has
00:41:00
where she wants to basically break up
00:41:01
the company because they've got this
00:41:03
Monopoly not just in search but also in
00:41:06
advertising maybe that's a good thing
00:41:08
and maybe Amazon should have to spin out
00:41:10
AWS maybe Google Chef to spin out
00:41:12
YouTube because I do think they are
00:41:15
abusive in the way they exercise their
00:41:18
Authority as a small example over the
00:41:20
past week
00:41:21
YouTube Just banned a video of Jordan
00:41:25
Peterson interviewing
00:41:28
RFK Jr why
00:41:30
what gives them the power to interfere
00:41:33
in our democracy that way where they
00:41:34
just decide for their own reasons that
00:41:38
the public can't watch a video of Jordan
00:41:40
Peterson interviewing RFK well I
00:41:42
wouldn't be capitalism didn't the
00:41:44
Supreme Court just say private companies
00:41:46
can serve customers however they want if
00:41:48
you want a gay cake baker doesn't have
00:41:50
to make it isn't the same
00:41:52
analogy no I don't think it's the same
00:41:53
principle these are huge monopolies that
00:41:55
have tremendous Market power that are so
00:41:57
small companies can choose their
00:41:59
customers and products but the big
00:42:01
company has a more of a responsibility
00:42:03
to be an open platform in your mind yeah
00:42:05
that's a common carrier argument yeah
00:42:07
but my point is just they have
00:42:09
tremendous Market power that they abuse
00:42:10
in arbitrary ways you have to admit sax
00:42:13
their her lawsuit strategy is scatter
00:42:15
shot it's a little bit spray and pray In
00:42:18
fairness to her she said she was going
00:42:19
to do but for example like but where is
00:42:21
the I agree with you like where's the
00:42:23
lawsuit on Adobe figma that seems like a
00:42:25
more obvious one you have the number one
00:42:27
and the number two right there's a clear
00:42:28
number one Monopoly buying the number
00:42:30
two and so that could be more of Market
00:42:32
consolidation than a number three player
00:42:34
buying a game nobody that the public
00:42:37
doesn't know those names and Biden put
00:42:39
her in there to be anti-tech
00:42:43
but no I just want to tell you her
00:42:45
position has also been driven by wealth
00:42:47
inequality which is not the Mandate of
00:42:49
the FTC
00:42:50
I think that's why she's the worst
00:42:52
modern day FTC head I'll say it again
00:42:55
because she should be looking at tactics
00:42:57
and the tactics she should do is the App
00:43:00
Store on iOS should be open to other app
00:43:03
stores
00:43:05
Amazon you know is open to third-party
00:43:07
sellers they should be looking at the
00:43:09
bundling of Microsoft of teams and say
00:43:11
you know what because you have a
00:43:12
monopoly position you can't add things
00:43:14
to the bundle without charging for them
00:43:15
so if you want to include Microsoft
00:43:17
teams you got to put a price on it and
00:43:19
the price has to be a fair market Price
00:43:21
because you're doing product dumping
00:43:23
you're dumping into the market a free
00:43:24
product with your Market position
00:43:27
instead when they launch that the
00:43:29
settlement should be Microsoft team
00:43:31
should be plus eight dollars per month
00:43:32
per person plus four dollars worth but
00:43:34
she shouldn't be allowed to dump
00:43:35
products onto the market I think the
00:43:37
Tactical stuff
00:43:40
that got a response okay Freeburg first
00:43:42
chamat sex free bird I'm just asking why
00:43:45
like why wouldn't it be okay for
00:43:48
Microsoft to put a cheap product out if
00:43:49
someone makes an alternative to teams
00:43:51
that is a better product with more
00:43:53
features than they charge for it and
00:43:54
people are willing to pay for it they'll
00:43:55
win in the market because of bundling
00:43:57
bundling and product dumping is illegal
00:44:00
according to the F the laws in the
00:44:02
United States well I'm asking you think
00:44:03
that's I agree with that yeah as a form
00:44:06
of bundling you got to make that
00:44:07
argument but yes I agree with that too
00:44:09
but look the way I judge these things is
00:44:11
what is good for the ultimate health of
00:44:14
the startup ecosystem because
00:44:16
entrepreneurship is the thing that we
00:44:17
should be optimizing for not the power
00:44:19
or wealth of big companies but the
00:44:22
vibrancy and dynamism of the star
00:44:25
ecosystem as a whole because I think
00:44:27
that long term that's what leads to the
00:44:29
creation of new big companies that's
00:44:30
what's good for America my co-sign yeah
00:44:32
so with FTC I think Lena Khan hasn't
00:44:35
gotten the formula right I think she's
00:44:36
challenging some of the wrong M A deals
00:44:38
but like I said I'd like to see her
00:44:40
regroup and figure out how to take on
00:44:42
these big companies because I do think
00:44:43
they have to be restrained on the other
00:44:45
hand what's happening with SEC and
00:44:47
operation choke point is I think they
00:44:51
would have basically put the kibosh on
00:44:53
the whole crypto ecosystem I mean if you
00:44:55
basically come out and say that there's
00:44:57
no such thing as a token that every
00:45:00
single
00:45:01
token is basically a security then
00:45:03
that's the end of crypto as a potential
00:45:06
Center of innovation now we can argue
00:45:09
about what the utility of it is we can
00:45:11
argue about whether the long-term going
00:45:12
to be anything there I don't really know
00:45:14
for sure but I would like the United
00:45:16
States to be the place where we figured
00:45:18
this out not driving it overseas so I'm
00:45:20
happy that the judge found in favor of
00:45:23
Ripple without knowing anything
00:45:24
specifically about what Ripple did and
00:45:26
I'm not endorsing their behavior or
00:45:28
tactics or whatever but I'm happy that
00:45:31
there is now a precedent that says that
00:45:34
you can have a token like xrp that is
00:45:36
not a security because that is going to
00:45:38
enable more innovation in the ecosystem
00:45:40
because it was really going the other
00:45:41
way before and my critique of what the
00:45:45
SEC was doing is they were basically
00:45:46
seizing power that they did not have I
00:45:49
mean basically Gensler unilaterally was
00:45:53
telling Americans that they cannot hold
00:45:55
or buy or trade crypto because when you
00:45:57
say that
00:45:58
every tokens of security and they can't
00:46:01
operate on exchanges you're basically
00:46:03
saying that Americans don't have the
00:46:04
right to engage in crypto and I think
00:46:06
that was basically a bridge too far
00:46:08
charmath you wanted to get in on that
00:46:10
well I just think that part of the thing
00:46:12
that
00:46:13
I think maybe the FDC suffers from is
00:46:16
that Nina Khan is a very young academic
00:46:18
and maybe what we need
00:46:22
to have a little bit more
00:46:24
of a higher batting average or slugging
00:46:26
percentage here is just actually have
00:46:28
somebody that understands how business
00:46:29
works because I think the scatter shot
00:46:32
approach doesn't do much and I think it
00:46:34
just wastes taxpayer money by funding
00:46:36
these frivolous lawsuits that then
00:46:38
sophisticated organizations like
00:46:39
Microsoft and meta just went yeah and so
00:46:43
where does it leave us it weakens the
00:46:44
institution it makes the laws
00:46:47
frankly not enforced where they need to
00:46:49
be
00:46:50
and the whole point is not a marketing
00:46:52
exercise or a PR exercise to go after
00:46:54
companies you dislike but to actually
00:46:56
enforce the laws of capitalism and
00:46:59
Market dynamism and so to not do that I
00:47:01
think is very
00:47:03
egotistical
00:47:04
I think it's emotional and I think it
00:47:06
sets the us back because the things that
00:47:09
should get stopped don't and then all
00:47:12
this other stuff is just a red herring
00:47:13
and a waste of time and taxpayer money I
00:47:15
think you absolutely nailed it there I
00:47:17
think both of you know that um and
00:47:18
chamatha I think she needs to focus on
00:47:20
product dumping you can pull up the
00:47:22
screenshot here predatory or below cost
00:47:24
pricing is well within the ftc's Mandate
00:47:27
you can go look up just type in predator
00:47:29
or below cost pricing FTC and you can
00:47:31
read all about it it's absolutely clear
00:47:33
that you cannot put products out there
00:47:36
at a lower price and so you have to have
00:47:38
a granular discussion is teams Microsoft
00:47:41
teams a product or a feature I think we
00:47:43
all know it's a product
00:47:44
and so that's an easy win for her
00:47:46
interoperability
00:47:48
should Android people be not allowed to
00:47:50
use iMessage should people on iOS not be
00:47:53
able to use the play store or Buy
00:47:55
digital assets from Amazon obviously
00:47:57
Apple should be stopped there so
00:47:59
interoperability
00:48:01
and then there's one that's a such a
00:48:03
clear easy layup for her and you know
00:48:05
we'd all like to see her succeed but I
00:48:07
think she is absolutely doing Biden's
00:48:08
bidding
00:48:09
with an anti-tac anti-wealth creation
00:48:12
anti-capitalism frankly pro-union
00:48:15
punishment I think this is punishment
00:48:17
for Tech being too successful I don't
00:48:19
think it's logical if you really want to
00:48:21
get them go after dark patterns and if
00:48:22
you don't know what dark patterns are
00:48:24
that's when you subscribe for the Wall
00:48:25
Street [Â __Â ] journal online and then
00:48:28
you have to call them to unsubscribe and
00:48:30
there are so many dark patterns and I
00:48:33
think Amazon's getting in trouble for
00:48:34
this for prime one of the most loved
00:48:36
products of all time obviously but dark
00:48:38
patterns could be stopped by the FTC and
00:48:41
that's where they can really really do
00:48:43
damage I heard today that they're
00:48:44
investigating chat CPT for giving out
00:48:46
wrong answers
00:48:47
it says right on it it's going to loosen
00:48:50
and give you a wrong examples this is an
00:48:51
experiment another example of the FTC
00:48:54
going after
00:48:55
you know the wrong thing so just I think
00:48:57
she needs a sniper rifle not a shotgun
00:49:00
and she's got it she needs to get a Kill
00:49:02
Shot where's the kill shot coming from
00:49:04
let's kill Google
00:49:07
well yeah I mean that was pretty
00:49:08
controversial when you said blow it up I
00:49:10
mean I would love for you to say more on
00:49:12
that yeah well I paraphrased a line from
00:49:15
RFK Jr who was paraphrasing a line from
00:49:17
JFK which is he wants to shout out the
00:49:19
CIA into a thousand pieces and Scattered
00:49:21
to the wins I said that after they
00:49:23
banned the Jordan Peterson RFK interview
00:49:25
that we should shatter Google into a
00:49:27
thousand pieces and Scout the wins and
00:49:29
that thing went massively viral there's
00:49:31
a big part of this country that has
00:49:33
really passed at Google and the way
00:49:34
they're exercising their arbitrary power
00:49:36
how many did they get 12 000 likes I
00:49:38
just think that the people running that
00:49:41
company I don't understand how they make
00:49:43
these decisions just makes no sense well
00:49:45
Freeburg you worked there what are your
00:49:46
thoughts on breaking up Google and how
00:49:48
they make decisions
00:49:51
look I'm a free market guy as you guys
00:49:54
know I think that consumers vote with
00:49:57
their dollars and their eyeballs and
00:49:58
their time
00:50:00
and ultimately
00:50:01
as we see with Disneyland in Disney
00:50:04
World if people don't like the behavior
00:50:06
of a business they're gonna stop giving
00:50:09
their time and their money to that
00:50:10
business by the way Freeburg were you
00:50:12
shocked at the fall off in traffic I did
00:50:14
I actually immediately thought I'm gonna
00:50:16
take my kids to Disneyland
00:50:17
yeah
00:50:19
please Republicans stay home Disney
00:50:22
hates you do you guys know yeah
00:50:26
it's so expensive and I'm like man if I
00:50:29
could two times stop being so cheap it's
00:50:32
the number one problem we have with you
00:50:33
is that you're driving a 12 year old
00:50:35
Audi that gets six miles to the gallon
00:50:37
when you could drive a great car I love
00:50:39
the Audi RS7
00:50:42
a hole in the ozone you hypocrite and
00:50:45
you're a hypocrite because you should
00:50:47
you deserve that
00:50:49
you deserve that what is it ten thousand
00:50:51
dollars for the day to bring your kids
00:50:53
to Disneyland VIP or you can do it it
00:50:55
just hires somebody in a wheelchair it's
00:50:57
ridiculous the uh the cost but yeah you
00:50:59
get to cut all the lines and everything
00:51:00
I think it's something so I generally
00:51:03
don't love the crowds so if it's going
00:51:04
to be less crowded I'm more interested
00:51:05
in taking my kids there it's already
00:51:07
hard enough to deal with the you know so
00:51:09
speaking of you know Freeburg made this
00:51:10
point about
00:51:11
the administration being overzealous did
00:51:14
you guys see this article on the glut of
00:51:16
electric cars that are piling up now
00:51:18
yeah on dealers Lots yeah we shift gears
00:51:21
to this by the way I think this is a big
00:51:22
part of what I said earlier about
00:51:24
interest rates on car loans this
00:51:26
specific thing is more because of the
00:51:28
bureaucracy of the government not
00:51:29
allowing these credits to basically work
00:51:32
across all different kinds of cars this
00:51:34
this should not exist for the reason
00:51:36
this is not a demand issue this appears
00:51:38
to the bureaucracy issue yeah government
00:51:40
intervention and market dynamics is that
00:51:42
the driver oh yeah so axio so it says
00:51:45
here
00:51:46
the Legacy Auto industry is beginning to
00:51:48
crank out more EVS to challenge Tesla
00:51:50
but there's one big problem not enough
00:51:52
buyers there's a growing mismatch
00:51:54
between EV supply and demand
00:51:56
even though consumers are sharing more
00:51:58
interest in EVS they're still worried
00:51:59
about purchasing one because of either
00:52:01
price or charging concerns range anxiety
00:52:06
yeah a lot of these new companies that
00:52:09
are they're not new companies but
00:52:10
they're new to EVS don't have charging
00:52:11
networks yep
00:52:14
that's an issue and then also if you've
00:52:16
never owned an EV
00:52:18
and you don't live in a city because now
00:52:20
we're going down the curve of people who
00:52:22
live outside of cities and you see 200
00:52:24
mile range you remember your trip where
00:52:26
you drove 300 miles or 400 miles and
00:52:28
you're like well then I can't have this
00:52:29
car if you have a Tesla you obviously
00:52:31
can but then Tesla also made the chess
00:52:33
move of lowering their prices and having
00:52:35
record sales so their margin went down
00:52:37
but their sales went up and everybody
00:52:39
can wait a year like that's I think that
00:52:42
what people don't realize about cars you
00:52:44
can always get another year out of your
00:52:45
current car so according to this article
00:52:48
the Nationwide supply of EVS in stock
00:52:51
has grown nearly 350 percent this year
00:52:54
to more than 92 000 units which is a
00:52:57
92-day supply of EVS whereas by
00:53:01
comparison dealers have 54 days worth of
00:53:05
gasoline-powered cars in inventory
00:53:07
so even though interest is growing in
00:53:12
EVS they're simply too much Supply too
00:53:15
much Supply it's because all these other
00:53:17
companies like Ford and GE are now
00:53:20
producing tons of EVS but they don't
00:53:22
have the charging networks and they're
00:53:24
new to the EV game and they don't really
00:53:26
produce Great Cars Great EVS
00:53:28
Tesla does not have this problem by the
00:53:30
way and what I come back to is just the
00:53:33
administration's industrial policy I
00:53:34
mean the administration just gave all
00:53:37
these subsidies and credits to big
00:53:39
companies like Ford and GE to make EVS
00:53:42
but no one wants those cars yep
00:53:45
by the other problem and so they're
00:53:47
actually interfering in a free market
00:53:49
where Tesla
00:53:51
is the big winner because they took a
00:53:53
huge risk and created a product people
00:53:55
wanted and now you've got these big
00:53:57
stodgy old companies trying to catch up
00:53:59
but no one wants their cars and the
00:54:01
administration which is pro-union is
00:54:03
anti-tesla because they don't have a
00:54:05
union and so they put the thumb on the
00:54:07
scale and give them the credits instead
00:54:09
of giving the credits to Tesla although
00:54:11
Tesla lowered their prices and I think
00:54:12
they now qualify but the prices are so
00:54:14
low for Tesla and the cars are so
00:54:16
sophisticated listen not to talk up our
00:54:18
guy's book but
00:54:19
I think the other big issue here that's
00:54:21
not mentioned the story is interest
00:54:23
rates I mean if if you could give these
00:54:25
things away at two percent three percent
00:54:26
four percent interest rates that's a big
00:54:28
difference isn't it
00:54:30
yeah monthly car payment eighty percent
00:54:32
of new cars are
00:54:35
financed okay so that's the beginning
00:54:37
and end of this probably I mean it's
00:54:39
it's three factors going on here and
00:54:41
interest rates on auto loans have
00:54:42
doubled like the chart I showed so yeah
00:54:43
you know it's it's a huge impact on
00:54:45
demand overall and it's not you know if
00:54:47
you know the adoption curve of
00:54:49
technology I think we're getting into
00:54:51
the big middle the fat middle and then
00:54:52
going to the laggards and the laggards
00:54:54
want
00:54:55
an F-150 or a cyber truck and until
00:54:57
those emerge or a Suburban that's
00:54:59
electric you know three rows with a lot
00:55:02
of storage those those don't exist yet
00:55:05
all right so Jacob let me ask you a
00:55:06
question okay so you've got an
00:55:08
Administration that is overzealous as
00:55:11
Freeburg said on Industrial policy
00:55:13
basically subsidizing these like old
00:55:15
stodgy broken companies like Ford at the
00:55:18
expense of innovators like Tesla they
00:55:20
are bringing a bunch of anti-m a FTC
00:55:24
lawsuits that you don't like they are
00:55:27
cracking down on crypto which you may
00:55:29
like but in an overly aggressive way the
00:55:31
course is thrown that out I would like
00:55:33
to have the rules Fair yeah
00:55:37
we've just gotten off of a one to two
00:55:40
year spike in inflation caused by
00:55:43
runaway deficit spending and over
00:55:45
stimulus so my question to you is
00:55:48
is the economy doing so well because of
00:55:51
or in spite of this Administration I
00:55:53
think it's a
00:55:55
innovators and consumers drive the
00:55:57
economy I think I voted for Biden and uh
00:56:01
over Trump because I think Trump would
00:56:03
have stolen the election and as a
00:56:05
treasonous felony felonious
00:56:08
horrible human being
00:56:10
and I thought it was existential crisis
00:56:12
for America now if you could put up a
00:56:13
republican candidate like Chris Christie
00:56:15
who I just uh
00:56:16
just put me in touch with Chris
00:56:18
Christie's coming on the show so Nikki
00:56:20
and Chris Christie are coming on the
00:56:21
show you couldn't deliver you couldn't
00:56:23
deliver DeSantis for the show so I will
00:56:25
deliver Chris Christie and Shabbat is
00:56:27
going to deliver Nikki Halley I'm gonna
00:56:28
vote I'm giving my announcement now
00:56:30
if Chris I'm gonna vote for Chris
00:56:32
Christie I think
00:56:39
the administration is helping the
00:56:42
economy or hurting the economy
00:56:45
I think the runaway spending to
00:56:46
freeburg's point last year is
00:56:49
made me a single issue voter and I think
00:56:52
that their spending disqualifies them
00:56:54
for me voting for them
00:56:56
I need somebody who's going to balance
00:56:57
the budget or get this spending I can
00:56:58
tell I love you now oh my God no I mean
00:57:00
I can agree with you on some things I'm
00:57:02
like Han Solo you're like C-3PO I need
00:57:04
you to navigate an asteroid field but I
00:57:07
need you to also just shut the [Â __Â ] up
00:57:08
when I'm doing it okay so just let me
00:57:09
cook as the world's greatest moderator
00:57:11
now I do agree with you on this you're
00:57:14
you're absolutely correct if we don't
00:57:16
get the balance sheet right nothing else
00:57:18
matters and I don't think Trump's crazy
00:57:20
spending and Biden's crazy spending is
00:57:21
not going to get us out of this
00:57:23
we need somebody to control spending a
00:57:25
period full stop I don't know how you
00:57:27
where how are you guys feeling about the
00:57:29
election at this point
00:57:31
I guess we could just read that book the
00:57:33
deficit myth okay that book is the
00:57:35
problem it's it's that we can always
00:57:37
just issue money because we are the
00:57:41
currency that everyone wants to hold
00:57:43
and the flawed logic is that we are at
00:57:46
the currency that everyone wants to hold
00:57:48
until we issue too much debt yeah we've
00:57:51
rehashed this I mean the interest
00:57:52
payments I think are the backstop
00:57:53
shamoth when we start hitting those
00:57:54
interest payments
00:57:56
people are going to start going uh we're
00:57:57
paying more in interest just like people
00:57:59
with their home mortgages or like you
00:58:01
know I should have bought a smaller
00:58:02
house because I'm paying so much in
00:58:04
interest I should have bought a model 3
00:58:06
instead of a model x i i over I
00:58:08
overspend so is that going to be the
00:58:10
backstop for the United States itself is
00:58:12
there any path to controlling spending
00:58:13
is there any candidate who will get
00:58:15
spending under control or is it popular
00:58:17
RFK you think okay and the reason is
00:58:21
because he's so against the military
00:58:22
industrial complex and he wants to pass
00:58:24
an executive order that Bans
00:58:26
pharmaceutical advertising those things
00:58:28
would have a pretty large ripple effect
00:58:30
in the economy and in spending and in
00:58:32
entitlements so be interesting to let it
00:58:35
play out
00:58:37
all right that's what you really care
00:58:38
about yeah those things would be
00:58:41
pretty meaningful changes
00:58:43
sax anything from you on uh any theory
00:58:46
on how we could control spending in this
00:58:48
country if there's any backstop I.E my
00:58:50
theory when we start paying huge
00:58:52
interest payments maybe we get our act
00:58:53
together
00:58:54
is there any candidates at the end of
00:58:56
the day the Market's probably going to
00:58:57
impose discipline on us that's sort of
00:58:59
my point yeah yeah you're right the cost
00:59:01
of boring will become so painful that is
00:59:04
the argument that Larry Summers another
00:59:06
contrarian economists contrary into the
00:59:08
administration's policy have been making
00:59:11
I'm sorry I don't want to put that in
00:59:12
his mouth but
00:59:14
that the cost of borrowing is going to
00:59:17
be high as long as spending remains high
00:59:19
and so when you see security and climate
00:59:21
transition type and simulatory spending
00:59:24
going on chips act Ira all this sort of
00:59:26
stuff it's not cost free you have to pay
00:59:29
more to the buyers of your debt yeah can
00:59:33
speak to this uh The Vig you know it's
00:59:36
always uh if you replace a lot of bats
00:59:38
The Vig doesn't go down it goes up when
00:59:40
the debt goes up so anyway just on the
00:59:42
market imposing discipline on the
00:59:45
federal government you know one of the
00:59:47
things we've talked about is whether
00:59:49
there could ever be an alternative
00:59:50
Reserve currency and the theory was that
00:59:53
as problematic as the U.S fiscal
00:59:54
situation is there's no real alternative
00:59:56
to the US dollar the brics countries are
00:59:59
about to introduce an alternative
01:00:01
currency that's based on gold
01:00:04
so it seems like what the brics
01:00:05
countries would like to do is use gold
01:00:08
go back to the gold standard gold
01:00:10
certificates as an alternative that's
01:00:13
basically what we're talking about so
01:00:15
it's announced they're gonna be rolling
01:00:17
this out we haven't yet seen how or what
01:00:19
the details are going to be but they
01:00:22
have scarcity built into it
01:00:24
that would be the alternative as you go
01:00:25
back to the gold standard and the brics
01:00:27
countries move to that now I know a lot
01:00:30
of people may not
01:00:31
think that's much of a threat but I was
01:00:34
reading actually some really interesting
01:00:35
articles about how big the brics
01:00:37
countries are now and if you look at
01:00:39
them on a purchasing power parity basis
01:00:42
the brics countries just surpassed the
01:00:45
G7 in terms of GDP so if you if you
01:00:50
measure the size of their economies
01:00:52
based on exchange rates then the G7 is
01:00:54
still bigger but if you look at in terms
01:00:57
of PPP actually the bricks are now
01:01:00
bigger than the G7 and growing faster
01:01:02
just and then for people who are
01:01:04
catching up Brazil Russia India China
01:01:07
and other what are considered Emerging
01:01:10
Markets but are quickly presuming yeah
01:01:12
Brazil Russia India China bricks and
01:01:15
there's a bunch more who want to join
01:01:17
with this Ripple ruling I think this
01:01:19
becomes a boon for people to say well
01:01:21
the scarcity of Bitcoin
01:01:23
and bitcoin's stability uh I think where
01:01:27
it's trading right around 30k between
01:01:28
the 10K previous average and the 60k
01:01:30
peak maybe that becomes the gold
01:01:33
standard in the future and it you know
01:01:35
if people can feel a little bit more
01:01:37
secure in it now are we going to see
01:01:39
like 10 counter lawsuits and everybody's
01:01:41
just going to sue the SEC and stand up
01:01:43
for themselves I think that's what's
01:01:45
going to happen now if Ripple wins this
01:01:47
or you know if this Ripple thing does
01:01:49
work out appeals whatever
01:01:55
and I think that's what m a is going to
01:01:58
happen all M A it's like well now the
01:02:01
settlement is off the table we're gonna
01:02:02
fight
01:02:03
and you know what you can afford a lot
01:02:05
of lawyers if you sold a lot of tokens
01:02:06
or you're a big money printing machine
01:02:08
quick plug for the summit go yeah well
01:02:10
we have
01:02:11
at this point the ability to announce a
01:02:14
bunch of our speakers for the summit
01:02:16
which is super exciting
01:02:17
put in like some tip in here
01:02:21
so we have Toby from Shopify
01:02:25
Stephen Wolfram of Wolfram Alpha
01:02:27
Mathematica obviously Mr Beast everyone
01:02:30
knows Mr Beast Mr Beast is coming Mr
01:02:32
Beast is coming okay
01:02:34
in the Green Room can I ask him take a
01:02:36
picture of my daughters you can do a
01:02:38
result yeah okay cool I think it'll be
01:02:42
interesting to ask Toby I tweeted this
01:02:44
out this whole thing that he did where
01:02:46
he canceled everybody's meetings and
01:02:47
that forced people to reset it with a
01:02:50
little calculator that shows how much
01:02:52
money that meeting costs in terms of
01:02:54
people it's in the Google Calendar too
01:02:56
it's like this meeting costs three
01:02:58
thousand dollars
01:03:00
he launched this AI thing called the
01:03:02
sidekick it's awesome it replaces like
01:03:04
all board meetings yeah if you're if
01:03:06
you're like that's basically it also
01:03:08
tells you how to do basic stuff that you
01:03:11
need to do to get your business stood up
01:03:12
it's fantastic we'll reconfigure a
01:03:14
website
01:03:15
in real time to increase sales it'll
01:03:18
tell you why sales are falling off a
01:03:19
cliff
01:03:20
it's like your little you know and he
01:03:22
said like every superhero needs a
01:03:24
sidekick and Robin boom so we got Rob
01:03:26
Henderson Nikki Paul vinod khosla Bob
01:03:28
mumgard from Commonwealth Fusion Jenny
01:03:31
just
01:03:32
Brian Armstrong
01:03:34
Alexandra boquequez uh of the bowtest
01:03:37
sisters
01:03:38
famous chess streamers
01:03:40
we have
01:03:41
the fifth bestie Brad gerstner Larry
01:03:43
Summers and a few others that we can't
01:03:46
announce just yet we'll announce closer
01:03:48
to the summit or at the summit we
01:03:50
reserved a hundred general admission
01:03:53
tickets for after we announced speakers
01:03:54
so we're going to update the website
01:03:56
with these speakers and we're reopening
01:03:59
GA ticket sales until those hundred
01:04:01
final tickets are sold out so if
01:04:03
interested in joining us it's going to
01:04:05
be a fantastic event Jason organizing
01:04:07
amazing parties all three nights Sunday
01:04:09
Monday Tuesday night can't wait to find
01:04:11
out about them
01:04:12
great speakers yeah go for it first
01:04:15
first night's party I mean this is
01:04:17
subject to change is uh the bestie Who
01:04:19
Loved Me Casino Royale James Bondi wear
01:04:22
your best James Bond tuxedo play
01:04:24
roulette baccarat whatever white bow
01:04:26
ties yes exactly
01:04:29
second night party is gonna be bestie
01:04:32
club like The Breakfast Club 80s big 80s
01:04:35
I thought it was like Fight Club where
01:04:37
people get arrested again okay and then
01:04:40
the last night the raised and we're
01:04:43
gonna go late
01:04:44
I don't know how late but we're gonna go
01:04:45
late we're gonna have a rave it's gonna
01:04:47
be bestie Runner a Blade Runner
01:04:49
cyberpunk send-up wear your best Blade
01:04:52
Runner cyberpunk Rave outfit sax is
01:04:54
gonna dress like
01:04:56
The Fifth Element red meat for sacks
01:04:59
yeah and for uh jaycal to a certain
01:05:01
extent there are no winners and more
01:05:02
NATO has uh brought Sweden and obviously
01:05:05
Finland came in right before them
01:05:07
because of Putin's invasion of Ukraine
01:05:10
and here we go uh zielinski uh denounced
01:05:13
the NATO alliance's Administration
01:05:15
policy as absurd and disrespectful first
01:05:18
sentence of uh Sax's very long tweet
01:05:21
storm despite Biden's best efforts to
01:05:22
put a happy face on it villainous will
01:05:24
be remembered as the NATO Summit where
01:05:26
tensions boiled over obviously this
01:05:29
photo has become a bit of a meme
01:05:32
throw it up on the screen right here
01:05:34
zielinski literally not figuratively
01:05:37
having NATO turn his back on him on
01:05:40
stage from being the cost celeb last
01:05:41
year to everybody I you know and again
01:05:44
it's it's just a picture uh
01:05:46
there was a I would say press conference
01:05:48
with Biden who said zelinski was stuck
01:05:50
with the US and uh I'll let sax take it
01:05:54
from there these NATO meetings are
01:05:57
supposed to be symbols of unity and
01:06:00
Harmony and the alliance coming together
01:06:02
to show how on the same page they are
01:06:05
and this meeting it sort of ended up
01:06:08
there but it's not the way it started
01:06:12
zielinski had been told the ukrainians
01:06:14
have been told before the summit that
01:06:16
there would not be a timetable for their
01:06:18
admission to Nato on the agenda
01:06:20
stoltenberg had said it weeks ago Biden
01:06:22
said it weeks ago this controversy had
01:06:25
played out already in the pages of the
01:06:26
New York Times and other Publications so
01:06:29
he knew that it would not be on the
01:06:31
agenda and yet he went into the meeting
01:06:34
demanding that they put it on the agenda
01:06:35
trying to muscle his way into admission
01:06:39
into NATO which Biden I think to his
01:06:41
credit has resisted because Biden
01:06:43
understands that this is an escalation
01:06:45
that could lead to World War III as
01:06:47
Biden explained
01:06:49
the members of NATO have an article 5
01:06:51
commitment to defend each other's
01:06:52
territories so if Ukraine is admitted to
01:06:55
Nato then we would end up being directly
01:06:57
involved in this war or at least that's
01:06:59
the risk and so
01:07:02
Biden's position is that the alliance
01:07:04
will emit Ukraine at some point in the
01:07:08
future when the conditions have been met
01:07:10
and that wasn't good enough for
01:07:12
zielinski and he basically threw a
01:07:13
diplomatic tantrum why well I mean do
01:07:15
you want to explain from his point of
01:07:17
view I mean I'm curious what you would
01:07:18
think his why would he do something like
01:07:20
that is I guess my question yeah I think
01:07:21
there's a couple of different reasons
01:07:23
okay so I think the less positive
01:07:26
explanation is that his sense of
01:07:30
entitlement has reached incredible
01:07:32
proportions that you had here the entire
01:07:36
West and especially the Western media
01:07:39
has been fawning over him for a year the
01:07:41
West has given over a hundred billion
01:07:43
dollars and he just feels entitled to
01:07:46
more and more Aid and I think that
01:07:48
really rubbed the attendees the wrong
01:07:51
way you had Ben Wallace who's the
01:07:53
Secretary of Defense for the UK
01:07:54
basically chastised zielinski for his
01:07:57
ingratitude and just so you understand I
01:07:59
mean Ben Wallace is a Super Hawk he is
01:08:02
super pro Ukraine and if he had his way
01:08:05
we might even be directly involved in
01:08:07
the fighting Biden actually vetoed Ben
01:08:09
Wallace becoming the new head of NATO
01:08:11
that's why stolenberg got another year
01:08:13
so he probably got one of the most
01:08:15
hawkish members of this club
01:08:19
reprimanding zielinski for again this
01:08:23
lack of gratitude basically to the
01:08:24
alliance now I think from zelinski's
01:08:27
standpoint
01:08:28
his view is that hey we had a peace deal
01:08:31
he didn't say this but this is my
01:08:33
reading between the lines that we had a
01:08:36
peace deal at Istanbul we could have
01:08:37
ended this war and you sent Boris
01:08:40
Johnson to tell me we don't want to make
01:08:42
a deal we want to pressure Putin and
01:08:44
we're going to give you the weapon
01:08:44
systems to win this war
01:08:46
that was the deal that he thought he was
01:08:48
making and now it turns out that the US
01:08:50
doesn't have enough
01:08:51
ammunition to give him I'm talking about
01:08:53
the key type of ammunition in this war
01:08:55
which is artillery shells the U.S has
01:08:58
basically run out of 155 millimeter
01:09:01
artillery shells which are the key type
01:09:03
of ammunition that's used in these
01:09:05
howitzers and these tanks and so forth
01:09:08
and artillery is the main weapon being
01:09:10
used in the swords what's creating most
01:09:12
of the casualties so it must have come
01:09:14
as a rude awakening to zielinski to find
01:09:17
out that his Partners don't have enough
01:09:19
ammunition to give him and I'm still
01:09:22
stunned that we spent over 800 billion a
01:09:25
year
01:09:26
on defense and we could run out of
01:09:29
ammunition I mean how does that happen I
01:09:31
mean how royally screwed is the American
01:09:34
taxpayer when we spend 800 billion a
01:09:36
year and we are out of ammunition
01:09:37
already it is mind-boggling to me now
01:09:40
the problem it's mind-boggling right I
01:09:42
mean how incompetent has our military
01:09:44
industrial complex become that this
01:09:46
could even happen we need more
01:09:48
competition startup shout out Palmer
01:09:50
lucky friend of the podcast
01:09:53
I mean I know he hates you but I I do
01:09:56
think that the solution is 10 more
01:09:57
Palmer Luckys I mean I think the Silicon
01:10:00
valleys
01:10:02
anti-supporting the military is a crazy
01:10:04
position that needs to change and we
01:10:06
should make more weapons and have VC
01:10:08
back companies making weapon systems
01:10:10
that are more affordable and and you
01:10:12
know more advanced obviously this is
01:10:14
actually not a case of needing some
01:10:16
smart bomb or something
01:10:19
this is basically just basic industrial
01:10:22
production and we've hollowed out so
01:10:25
much for our industrial production that
01:10:26
we don't have the capability to scale up
01:10:28
the manufacturing of these artillery
01:10:30
shells is going to take us according to
01:10:32
the Pentagon they started the war at 14
01:10:34
000 shells being produced a month mainly
01:10:36
for training purposes they've scaled
01:10:39
that to somewhere between 20 and 30 000
01:10:40
a month now
01:10:41
and they're saying that they will get to
01:10:43
about 90 000 in somewhere between 2025
01:10:47
and 2028. we have three percent
01:10:49
unemployment which I talked about
01:10:51
earlier who's going to work in these
01:10:53
factories right it's going to take
01:10:54
multiple years to scope these factories
01:10:56
but sax who's going to work in these
01:10:58
factories we're at three percent
01:10:59
unemployment like we don't have Factory
01:11:01
workers in this country we have to let
01:11:02
them in we're going to need more
01:11:04
immigrants that's not the limiting
01:11:06
factor here
01:11:07
but if you're wondering why did the U.S
01:11:09
give cluster bombs
01:11:11
to Ukraine it's because we're out of
01:11:14
ammo to give and it's all we've got left
01:11:16
are these stockpiles of cluster
01:11:18
Munitions that is why the United States
01:11:20
is violating international law a treaty
01:11:24
that we haven't signed but 120 other
01:11:26
countries have signed not to use cluster
01:11:29
Munitions and yet we are giving them to
01:11:32
Ukraine because according to both Biden
01:11:35
and Jake Sullivan we are out
01:11:37
you think we shouldn't give them a
01:11:39
cluster bombs that's your position well
01:11:40
I wouldn't have put ourselves in this
01:11:41
position I mean we're going to go on the
01:11:43
question would you give them or not no I
01:11:45
think it's degrading to America's moral
01:11:47
authority to be violating international
01:11:49
law to be using and endorsing cluster
01:11:51
Munitions but we put ourselves in this
01:11:53
situation the counter to that of course
01:11:55
is Russia is using them on Ukraine soil
01:11:58
this is Ukraine soil
01:12:00
don't they have the right to defend
01:12:01
themselves and use the same weapons that
01:12:03
the Invader is using that's disappeared
01:12:05
it's known yeah it is if the Russians
01:12:07
were using them would you think it would
01:12:09
be fair for the Ukraine since they're
01:12:11
being invaded the thing that I find
01:12:13
curious about these accusations is that
01:12:15
when people talk about these examples of
01:12:17
the Russians using cluster Munitions
01:12:19
they talk about an example here or an
01:12:21
example there they're these isolated
01:12:23
cases which doesn't sound right to me it
01:12:25
seems to me that if you're going to use
01:12:27
cluster Munitions why won't you just use
01:12:29
them at scale
01:12:30
that is what the ukrainians are going to
01:12:32
be doing now because again it's all
01:12:33
we've got left to give them now what the
01:12:35
Russians have said is that in
01:12:36
retaliation they're going to start using
01:12:38
cluster Munitions at scale so regardless
01:12:40
of the truth of those allegations Jason
01:12:42
yeah
01:12:44
escalating this war Yes
01:12:50
120 countries
01:12:52
signed an agreement not to use cluster
01:12:54
Munitions it was because they linger
01:12:55
yeah it's terrible on the battlefield
01:12:58
long after and you have kids walking on
01:13:00
them in civilians we're still cleaning
01:13:01
them up in many locations around the
01:13:02
world they should be banned for Emery I
01:13:04
agree let me get your take on this sax
01:13:07
as we wrap up here on the sax red meat
01:13:09
section and then go to science Corner
01:13:10
Putin did what
01:13:12
NATO couldn't do for decades which is
01:13:14
get Finland and Sweden who are famously
01:13:16
independent like a lot of the nordics to
01:13:19
join NATO they both joined because of
01:13:21
his invasion of Ukraine and he's been
01:13:25
very serious that if Finland were to
01:13:27
join or if Sweden were to join
01:13:29
that this would be uh
01:13:32
a trigger for him if military
01:13:34
contingents and Military infrastructure
01:13:35
were deployed there we would be obliged
01:13:37
to respond symmetrically and raise the
01:13:39
same threats to those territories where
01:13:41
threats have Arisen for us he's done
01:13:43
nothing
01:13:44
do you think that Sweden and Finland are
01:13:47
a huge L for him and do you think he'll
01:13:50
have any kind of response to it do you
01:13:51
think they should have been allowed in
01:13:53
tornado I think it's an L for everybody
01:13:55
I mean we used to have an understanding
01:13:58
that we'd have a buffer zone between
01:14:00
Russia and the west and that was good
01:14:03
for everybody Finland was neutral and I
01:14:06
think it was good for Finland I mean
01:14:07
during the entire Cold War they were at
01:14:10
much greater risk facing the Soviet
01:14:12
Union on their border which was a much
01:14:14
more powerful a much more expansionist
01:14:16
country than Putin's Russia has been
01:14:19
even if you don't like Putin's Russia
01:14:21
the Soviet Union was the evil empire it
01:14:23
was much worse in every Dimension and
01:14:25
Finland managed to survive the Cold War
01:14:27
remaining neutral and so now you're
01:14:30
right that
01:14:32
I think disinvasion of Ukraine has
01:14:35
ultimately caused Finland and Sweden to
01:14:38
join NATO but we are now directly NATO
01:14:41
is going to be directly on their border
01:14:43
staring eyeball to eyeball with nuclear
01:14:45
weapons the Russians have now moved
01:14:47
nuclear weapons into Belarus so this is
01:14:51
a ratcheting up of tensions that I think
01:14:53
is not good for anybody who should get
01:14:54
to decide Friedberg who joins NATO NATO
01:14:58
the countries I want to join or Russia
01:15:01
what do you mean NATO I don't understand
01:15:03
it's a pretty basic question you know
01:15:06
right now it's Russia saying Ukraine
01:15:08
cannot join NATO it's a Line in the Sand
01:15:10
obviously Finland and Sweden just joined
01:15:12
this year so I'm I'm sure it's your take
01:15:14
on the NATO alliance and if it's good
01:15:17
for Humanity
01:15:19
I think look obviously this is a this is
01:15:21
a different difficult Calculus if you
01:15:22
that's why I'm messing the question if
01:15:24
NATO wants to
01:15:26
escalate tensions with Russia by
01:15:29
accepting Ukraine it's obviously going
01:15:32
to require a significant influx of
01:15:34
capital by some estimates up to two
01:15:37
trillion dollars to increase the
01:15:39
security capacity of NATO
01:15:42
given the instigation that would arise
01:15:45
from accepting Ukraine into NATO with
01:15:47
Russia so
01:15:49
that is one path
01:15:51
that the other path is to not accept
01:15:52
Ukraine into NATO and minimize the
01:15:56
investment needed
01:15:57
reduce the escalatory cycle with Russia
01:16:00
to some degree for some period of time
01:16:01
see where things go with Ukraine in the
01:16:04
conflict between Russia and Ukraine well
01:16:06
said but not get actively involved so
01:16:07
it's a difficult calculus I I think
01:16:09
everyone everyone wants to jump to some
01:16:10
decision about what should be done here
01:16:12
but this is a very hard decision very
01:16:14
hard what do you think about Finland and
01:16:15
Sweden joining uh is it a is it a major
01:16:18
win for nato in the west is it a major L
01:16:20
for Russia somewhere in between I don't
01:16:22
really know yeah I think that's as
01:16:24
honest as you can get yeah like I said I
01:16:26
think it's just sort of bad for
01:16:27
everybody but in the United States
01:16:29
among the foreign policy establishment
01:16:31
they tend to think that any country
01:16:34
joining NATO is an asset for us and I
01:16:38
would argue that it's a liability
01:16:40
because it requires the U.S to defend
01:16:41
these countries again if Sweden or
01:16:44
Finland gets in a war we are making a
01:16:47
guarantee to send American boys and
01:16:49
girls to go defend that country now they
01:16:52
also make a guarantee to defend us but
01:16:54
realistically are we going to benefit
01:16:56
does our security benefit by having
01:16:58
Sweden or Finland we don't know how he's
01:17:01
going to defend us no so every time you
01:17:04
add a country to Nato you're making a
01:17:06
commitment for Americans to have to go
01:17:08
defend that country
01:17:10
and I would argue that's a liability not
01:17:13
an asset for America now you know it's
01:17:15
an asset for is a military-industrial
01:17:17
complex because all these countries when
01:17:19
they join NATO could be to spend two
01:17:22
percent of their GDP on defense and they
01:17:25
can only spend that money on defense
01:17:27
contractors who are interoperable with
01:17:28
the NATO platform which is basically
01:17:30
these approved Western contractors so
01:17:33
the defense industry loves NATO
01:17:35
expansion the military
01:17:38
absolutely oh I didn't know there was
01:17:41
vendor lock and that's like when you
01:17:42
rent like uh you know a union hotel or
01:17:45
something they're like you got to use
01:17:46
Wolfgang Puck and it's uh 800 a person
01:17:48
for coffee one of the requirements for a
01:17:50
country to join NATO and Ukraine already
01:17:52
had been on this path for the last few
01:17:56
years it's called interoperability you
01:17:58
have to make your military interoperable
01:18:00
with NATO's which means that you use
01:18:02
weapons as well as tactics and
01:18:04
strategies but weapons that are on the
01:18:07
approved NATO list
01:18:09
and if you looked at the summary we just
01:18:11
had in Vilnius when all the planes came
01:18:13
into the airport you had these
01:18:16
anti-aircraft batteries and howitzers
01:18:18
and all these tanks all these weapons
01:18:20
were being shown off by our defense
01:18:23
contractors at the NATO Summit it was
01:18:26
like a confab for the mic
01:18:29
all right so you have to understand that
01:18:30
NATO is a business and the more
01:18:32
countries that join NATO the more money
01:18:35
our defense contractors make yeah and
01:18:37
but that's the price of that for the
01:18:40
average American is that our sons and
01:18:42
daughters one day might have to go
01:18:44
defend these countries
01:18:48
is the risk of Russia going into another
01:18:49
country would be the other stale man of
01:18:52
it but let's go on to science Corner
01:18:53
every everybody everybody's favorite
01:18:55
part of the show is science corner
01:18:58
sax you can go use the bathroom and uh
01:19:01
chamoth and I will be absolutely
01:19:03
engaged in freeburg's science corner
01:19:07
let's go we were talking about what to
01:19:09
talk about as you guys know I said hey
01:19:10
we could talk about the sea surface
01:19:12
temperatures in the Atlantic that's
01:19:13
likely going to drive the biggest
01:19:15
hurricane season we've ever seen this
01:19:16
coming season super compelling good
01:19:18
topic we were going to talk about this
01:19:20
minimal cell but then just yesterday
01:19:22
this paper was published which I think
01:19:25
deserves a lot of attention and we've
01:19:27
talked about yamanaka factors and
01:19:30
reprogramming cells you know adjusting
01:19:32
the epigenetics of a cell to make it
01:19:35
youthful basically reversing aging and
01:19:38
you know a couple episodes ago I talked
01:19:40
about how there's great proof and
01:19:41
evidence now that aging is a result of
01:19:45
degradation or changes in the epigenome
01:19:48
the little molecules that stick on top
01:19:50
of the DNA in a cell that decide what
01:19:52
proteins are expressed that make that
01:19:54
cell different from all the other cells
01:19:55
the difference between an eye cell and a
01:19:57
muscle cell and a skin cell is the
01:19:59
epigenetics of that cell even though
01:20:01
they all have the same DNA in the
01:20:02
nucleus and so the yamanaka factors
01:20:05
these four chemicals that allowed the
01:20:06
expression of these four specific genes
01:20:08
cause cells to become stem cells that
01:20:11
can turn into any other cell the problem
01:20:13
with applying yamanaka factors
01:20:15
to reverse aging is that it turns the
01:20:18
cells into cancer cells if you apply too
01:20:19
much so then there were all these
01:20:21
efforts on doing short bursts of
01:20:22
yamanaka factors and more recently
01:20:25
there's been an effort to do Gene
01:20:28
insertions through viral vectors so you
01:20:31
basically get a virus to deliver a gene
01:20:33
into a cell that causes that cell to
01:20:35
express some of the yamanaka factors
01:20:37
that makes that cell more youthful and
01:20:39
there's actually clinical trials
01:20:40
underway right now to apply this as a
01:20:43
medicine for uh for vision loss
01:20:45
um where you can make the uh the the
01:20:47
retinal cells actually useful yeah
01:20:48
really incredible so the problem right
01:20:51
now is that we don't really know how to
01:20:52
Target the cells how to provide the
01:20:54
right amount of yamanaka factor stuff
01:20:57
and how to get it there is that these
01:20:58
Gene expressing viruses or what do we do
01:21:00
but this paper that was just published
01:21:03
yesterday shows that you can use small
01:21:05
molecules basically small molecules are
01:21:07
like Advil or Tylenol or you know
01:21:09
there's about 1800 molecules in a in a
01:21:13
certain reference library that's used in
01:21:15
medicine and what this research team at
01:21:18
Harvard Medical
01:21:20
um and and some other facilities MIT and
01:21:22
other places uh in collaboration we're
01:21:24
able to do is they basically did a
01:21:27
screen a combinatorial screen so they
01:21:30
took all these different molecules that
01:21:32
are known to be used in medicine and
01:21:34
they combine them together and create a
01:21:35
different cocktails they then took those
01:21:37
cocktails and they applied them to the
01:21:39
cells to see if they could reverse aging
01:21:41
and in fact they found six different
01:21:44
cocktails of small molecules that were
01:21:47
able to have the same effect as we see
01:21:49
with the yamanaka factors and short
01:21:51
bursts to cause these cells to actually
01:21:53
reverse their aging and become youthful
01:21:55
again I cannot overstate how important
01:21:57
this is this is probably the most
01:21:59
important trajectory of what's underway
01:22:01
in biology since the discovery of DNA
01:22:04
this ability to actually make cells
01:22:06
youthful again it can in fact ultimately
01:22:09
result in a pill or a series of pills
01:22:11
that can reverse aging that is why it is
01:22:14
so exciting right now and we're seeing
01:22:15
this data coming out from this research
01:22:17
team and I have heard separately about
01:22:20
data that has not yet been published by
01:22:22
other research teams following the same
01:22:24
track to do the same thing that it turns
01:22:27
out it may in fact be possible to create
01:22:29
pills with small molecules in it things
01:22:31
that your body can absorb and end up in
01:22:33
your bloodstream and go into different
01:22:34
cells that actually rejuvenate the cells
01:22:36
fix the epigenetic data loss that
01:22:39
happens in those cells causes them to
01:22:40
become more youthful you could see a
01:22:42
cream that you could apply to your skin
01:22:44
that takes away wrinkles ultimately you
01:22:46
could take something that makes your
01:22:47
heart healthier your liver healthier
01:22:49
and actually reverses Aging in the
01:22:51
individual cells by the absorption of
01:22:53
these small molecules into the cells
01:22:55
that ultimately cause the expression of
01:22:57
these genes and change all the
01:22:58
transcriptome as it's called in a cell
01:23:00
and makes it more useful it is
01:23:02
unbelievable work
01:23:03
everyone should be um I think fascinated
01:23:06
by this uh and where it's headed it is
01:23:08
so exciting that there are multiple
01:23:10
teams that are having breakthroughs on
01:23:11
this work that could ultimately
01:23:12
translate into clinical trials
01:23:15
um and products that could be used by
01:23:16
people the obvious question can we get
01:23:17
this to Biden before the debates
01:23:21
you're you're uh Uranus joke please
01:23:24
sorry I didn't mean to step on your
01:23:26
range I'm so tired I had such a big
01:23:28
night last night
01:23:30
man he's like I can't even get a Uranus
01:23:33
joke up I drank so much wine
01:23:36
I am [Â __Â ] gassed today when you say
01:23:41
you drag so much wine how many bottles
01:23:43
were opened and how many glasses did you
01:23:45
have be honest I'm gonna put the over
01:23:47
under at six glasses there was six 5.5
01:23:50
glasses there were six of us
01:23:52
this is probably seven or eight bottles
01:23:54
but it's just like
01:23:56
it was just so delicious and then I
01:23:59
don't like to eat a lot when I'm
01:24:00
drinking really really good wine and
01:24:03
then oh man wow sometimes okay it's all
01:24:06
right 5.5 you got the over or the under
01:24:08
sex 5.5 glasses I got these I I drank so
01:24:11
much I had the night sweats I woke up I
01:24:13
was like oh nothing like so hot I get
01:24:15
the night sweats I don't eat too much
01:24:16
meat so you were drinking red wine you
01:24:17
were not drinking wine no no white no
01:24:19
white white the whole night
01:24:21
yeah Champaign
01:24:24
champagne champagne will get you that
01:24:26
champagne what is the worst hanger is it
01:24:28
red wine champagne or white
01:24:31
what get your word I think it's like the
01:24:32
sweeter it is the higher the alcohol
01:24:33
content the more it really just [Â __Â ]
01:24:35
with me personally
01:24:37
producer Nick coming in hot seven dollar
01:24:40
pictures of sangria all night he said
01:24:42
sangria
01:24:43
because they pour sugar in it dude
01:24:46
sangria the more sugar it's just it's
01:24:48
just it's just a sugar bomb it's true
01:24:50
I'm gonna be in Italy so maybe we could
01:24:52
catch up and have dinner chamata I don't
01:24:54
know where you'll be about it probably
01:24:55
shortly I will look you up when I'm in
01:24:57
Italy maybe uh I don't know if any other
01:24:59
Busters are going to be in Italy anytime
01:25:00
over the summer
01:25:01
are we taping next week or no oh my God
01:25:04
can we do it live in Italy uh I'll be in
01:25:07
Italy next week actually
01:25:09
what are we doing next week are we
01:25:10
taping next week or no
01:25:12
I don't know if I say we're not taping
01:25:13
then freeburg's going broke so I'll say
01:25:15
up to you Friedberg it's apparently you
01:25:18
know how to hack the [Â __Â ] YouTube
01:25:19
channel shorts back of course I did I
01:25:23
need to have two factors when you hacked
01:25:24
it I was like who is trying to log in
01:25:26
and then uh
01:25:29
don't worry about it I'm gonna get your
01:25:31
phone next time
01:25:33
you know while you're in the bathroom
01:25:35
I'm gonna run into your house and take
01:25:36
your phone
01:25:37
thanks thanks that's you running into my
01:25:39
house I will say I'll tell you my honest
01:25:42
opinion I oh I missed you last week I
01:25:45
think that the show is better with you I
01:25:48
think that you bring a character and a
01:25:49
personality that I miss when you're not
01:25:51
around and as much as we fight like
01:25:54
brothers that truly hate each other I
01:25:56
really do
01:25:57
respect and appreciate what you do on
01:25:59
the show and I and I honestly felt it
01:26:01
was a big hole last week so despite all
01:26:03
of our issues I think it's great to be
01:26:06
doing the show with you I want to let
01:26:07
you know thank you that's free that's
01:26:09
very heartfelt and kind
01:26:10
um who wrote it who wrote that for you
01:26:12
is that Allison wrote that ciao GPT
01:26:15
how do I make jcal feel better do I
01:26:19
express emotion to a friend how do I
01:26:21
behave like a loyal friend yeah the
01:26:24
YouTube channel and publisher Rogue
01:26:25
episode no that's not how you do it uh
01:26:27
all right listen for the drunken
01:26:30
hungover dictator
01:26:32
c3p Friedberg the Sultan of science the
01:26:35
prince of panic attacks the queen
01:26:38
end
01:26:39
crazy hair don't care
01:26:42
the architect Steve Bannon with a high
01:26:45
IQ
01:26:46
his name is David Sachs I am the world's
01:26:49
obviously greatest moderator after this
01:26:52
[Â __Â ] show of last week
01:26:53
and this has been best episode of any
01:26:57
podcast ever recorded and we will see
01:26:59
you all next week
01:27:01
and we'll grab some pasta love you
01:27:04
besties love you guys
01:27:08
[Music]
01:27:17
and they've just gone crazy
01:27:19
[Music]
01:27:24
somehow
01:27:27
[Music]
01:27:51
we need to get Mercies
01:27:57
[Music]
01:28:01
I'm going all in
01:28:03
[Music]
