00:00:00
I started doing it and I'm sitting there
00:00:01
in the park and I'm like, do I really
00:00:03
need to be an [ __ ]
00:00:05
>> Not today. Yeah, tomorrow. Tomorrow.
00:00:13
>> Hi everyone. This is Pivot from New York
00:00:15
Magazine and the Vox Media Podcast
00:00:17
Network. I'm Cara Swisser
00:00:18
>> and I'm Scott Callaway.
00:00:20
>> We're going to do something a little
00:00:21
different today and start with a
00:00:22
voicemail from a listener who's going to
00:00:24
explain the situation. Let's play a
00:00:27
clip.
00:00:28
>> Hi. After listening to Pivot today, I
00:00:32
saw that James Murdoch is buying part of
00:00:35
Box Media and I was curious how that
00:00:38
might change the freedom you guys have
00:00:40
on your various podcasts. Anyway, love
00:00:43
your shows. Just finished burn book and
00:00:45
listen to all your podcasts. Keep up the
00:00:48
good work. Jenny from Texas.
00:00:50
>> Oh, that's a very good question. Jenny
00:00:52
from Texas. So, in case people don't
00:00:54
know what she's talking about, James
00:00:55
Murdoch's company, Lupa Systems, is
00:00:57
acquiring Vox Media Podcast Network, New
00:01:00
York Magazine, and the Vox site. Um, the
00:01:02
other parts of Vox Media, including
00:01:04
Eater, The Verge, SP Nation, are
00:01:05
becoming a a different company, a new
00:01:09
independent company. The deal is
00:01:10
expected to close in the coming weeks.
00:01:12
There's a few legal legalities and this
00:01:14
and that. From what I understand, Lupa
00:01:16
Systems has not disclosed the purchase
00:01:18
price, but it's reportedly around 300
00:01:19
million. the podcast network is the mo
00:01:21
the more attractive asset that we love
00:01:23
New York magazine and it does rather
00:01:25
well um and love docs uh and so explain
00:01:30
Scott people want to know what we think
00:01:32
about this because a lot of people have
00:01:33
bad information one first of all Jim
00:01:35
Bankov is staying as CEO of this unit um
00:01:38
it's a spin-off essentially uh of of
00:01:41
these assets and which have been fast
00:01:43
growing so explain Mr. business. Explain
00:01:46
the situation.
00:01:48
>> Well, about a decade ago, people
00:01:49
thought, wouldn't it be great to
00:01:50
aggregate kind of this alternative media
00:01:53
or build alternative media companies for
00:01:55
a new world? And so, Buzzfeed, Food 52,
00:01:59
CNET, Vice, was it called Mike,
00:02:03
Mashable,
00:02:04
>> Mike? Yeah.
00:02:04
>> And Vox. And back when they thought
00:02:08
probably six, seven years ago that if we
00:02:11
bring together sort of these good little
00:02:12
media assets, some digital, some not,
00:02:16
and group them together, we can spack it
00:02:18
and it'll go public at 1 23 billion. And
00:02:21
so Jim logically, the CEO of Vox thought
00:02:25
this is a good idea. bought New York
00:02:26
magazine, had a bunch of very, you know,
00:02:29
fast growing websites, Eater, Verge, you
00:02:34
know, Vulture, and then started some
00:02:38
naent podcasts, right? And then
00:02:40
essentially what happened was uh the
00:02:43
market never said, okay, there was never
00:02:46
the bloom came off the rose
00:02:48
>> of all these companies. But basically
00:02:50
they're competing against monopolies who
00:02:52
extract rents and then their margin was
00:02:56
you know the margin of all these
00:02:57
companies is Google and Meta and
00:02:58
Amazon's opportunity and they've slowly
00:03:00
but surely sucked the oxygen out of the
00:03:02
room and BuzzFeed from peak valuation to
00:03:04
sales price was off 86% food 52 lost 96%
00:03:08
of its value CNET lost 94% of its value
00:03:13
was I think uh basically went bankrupt
00:03:15
but sold some assets was down at least
00:03:18
93% % uh Mashable off 80%. I mean just
00:03:22
on and on and on and on. Tumblr, my
00:03:25
favorite, 1.1 billion to 3 million. Uh
00:03:28
if you're an investor in Union Square
00:03:30
Ventures, thank God that the guy with
00:03:33
the Caesar's haircut, I forgot his name,
00:03:35
was able to convince
00:03:38
probably one of the weaker CEOs in
00:03:39
digital history to buy his bag of [ __ ]
00:03:42
for 1.1 billion tons.
00:03:43
>> That was Marissa Mayer at Yahoo.
00:03:44
>> Marissa Mayor, right? So effectively
00:03:47
this has just not worked out. Now what
00:03:50
and what to be you know Jim our guy who
00:03:54
we like has always said Scott be honest
00:03:55
and always told us to be honest so let
00:03:57
me be honest. They spent a lot of money
00:03:59
to create a company with negative
00:04:01
synergy. There's some real assets there.
00:04:03
New York Magazine is a trophy iconic
00:04:05
asset. Um the the sites themselves, the
00:04:10
digital assets are actually do pretty
00:04:12
well, but again see above they're in
00:04:15
they're swimming upstream against
00:04:17
giants. And then the smaller division
00:04:19
that started out as an afterthought has
00:04:21
become the growth engine and the crown
00:04:22
jewel. And Jim is a smart guy and
00:04:25
realized that the whole was less than
00:04:27
the sum of its parts and basically
00:04:28
decided to break them up into what was
00:04:31
going to be three buckets. But my
00:04:32
understanding is, and I do not have
00:04:34
inside information here, and I don't
00:04:36
want it, is that Jim Murdoch or James
00:04:39
Murdoch, who wants to be in the media
00:04:40
business, said, "I'll take New York
00:04:43
Magazine because I think he likes it and
00:04:45
it's an iconic asset. And what I really
00:04:47
want is the podcast network, which is
00:04:50
growing. I'll stop there. Where did I
00:04:52
get that right?"
00:04:52
>> No, you got that all right. And I think
00:04:54
Jim of all of them has cannilally moved
00:04:57
that into a space. Obviously, Buzzfeed
00:04:59
uh just bought by Byron uh Allen. Um you
00:05:02
know, they've all Vice has had a much
00:05:04
less happy
00:05:06
situation. I don't know where that went.
00:05:08
Like there were a lot of them and it was
00:05:09
very exciting. And one of the reasons I
00:05:11
sold my tiny little site to Vox many
00:05:14
years ago, Recode, was cuz they were
00:05:17
ridiculously priced and were sort of
00:05:19
pricing me at I was even a smaller
00:05:21
minnow. And so when I got to Vox, um, I
00:05:25
I I understood the ad market was really
00:05:27
a problem here. Although we did great,
00:05:29
let me just The only thing you're
00:05:30
leaving out is so much great journalism
00:05:32
by so many of these sites and so much
00:05:34
really interesting independent media.
00:05:36
Absolutely. Um, all the Verge, Eater,
00:05:39
um, you know, all of them and New York
00:05:41
Magazine just won a the national the
00:05:45
general excellence award and the
00:05:46
national magazine awards. Wonderful.
00:05:47
>> It was punches above its weight class.
00:05:49
It's like the HBO of magazines is the
00:05:51
way I would describe it.
00:05:52
>> Right. Exactly. It's amazing. Um, and
00:05:55
so, uh, so anyway, so it it's it's
00:05:58
really nice parts. They're really nice
00:05:59
parts, but what happened was exactly
00:06:01
what Scott said and what I thought,
00:06:02
which is one of the reasons I went to
00:06:04
Jim 12 years ago and said, I'm going to
00:06:06
start this little podcast called um, uh,
00:06:09
was Recode Decode at the time or might
00:06:11
have been something else. I don't
00:06:12
remember what it was. and cuz I really
00:06:14
did have an interest in this area and
00:06:16
felt it was shifting and then they added
00:06:18
on the Ezra was on there. Um there's a
00:06:21
whole bunch uh today explained a bunch
00:06:22
of things and what essentially happened
00:06:25
after that after that I met Scott
00:06:27
Galloway and the rest is history like
00:06:29
we've done really well
00:06:30
>> bald man with the erectile dysfunction
00:06:32
Murdoch it just all makes sense
00:06:34
>> in Germany in the Murdoch
00:06:36
>> in the Murdoch and I worked for Murd so
00:06:38
rich isn't it how did this happen I know
00:06:41
right I know people are thinking it's
00:06:42
very funny for me especially because I
00:06:44
knew James from a million years ago when
00:06:46
he was actually around for digital stuff
00:06:49
um very early when I was covering the
00:06:50
early digital industry and he tried very
00:06:52
hard to move his family's company
00:06:54
digitally. But Rupert always did
00:06:56
something idiotic like whether it was
00:06:58
the way they handled MySpace or there
00:07:01
was so many I can't even tell you. I
00:07:02
just like Disney, they had 19 of these
00:07:05
things and especially the iPad news
00:07:08
thing that I thought was ridiculous. Um
00:07:10
and so I w I we left we left the Murdoch
00:07:13
Empire largely over um Rupert over
00:07:16
problems. He was he was doing all sorts
00:07:18
of nefarious things and we wanted to
00:07:20
come out on our own. Um and then ended
00:07:22
up selling to Vox and so everything
00:07:25
comes around essentially. I met Scott,
00:07:27
we built Pivot and we built each of our
00:07:29
other stuff on and all the prof stuff
00:07:32
which is wonderful. Um and over time in
00:07:34
our recent renegotiation we became
00:07:36
partners with Vox and they sell our
00:07:38
advertising. They help us mount the
00:07:41
events which they're excellent at and
00:07:43
Scott has his has his has his own way of
00:07:46
doing things. he just started a great
00:07:47
Substack and so it's a really actually
00:07:49
fertile time and but there's all these
00:07:51
different configurations and I would say
00:07:53
for people to understand they are we we
00:07:56
I have met with uh James Murdoch and uh
00:07:59
his uh wife um Katherine who is also
00:08:03
very involved in this uh I have nothing
00:08:06
but good feelings for them I don't have
00:08:07
good feelings for his father neither
00:08:09
does he um which has been well
00:08:11
documented um and so we have complete
00:08:13
freedom to do what we want we own these
00:08:15
podcasts s that we have. Scott owns his,
00:08:17
I own mine, and we own pivot together in
00:08:19
a in a um in a death grip to the end for
00:08:22
whoever which one of us survives. Um and
00:08:25
uh and so we'll be keep doing what we
00:08:27
want and we really like working with
00:08:29
Jim. We and now this other gym and uh
00:08:32
and the rest of it and we hope there'll
00:08:33
be more, you know, synergies between
00:08:35
them. We're we're not like a total
00:08:37
believer in all synergy, but they've got
00:08:38
some cool uh things like Art Basle and
00:08:42
um a number of number film festival,
00:08:45
which I'll be at uh interviewing Mark
00:08:47
Maron on stage. And so there's lots of
00:08:49
opportunities here, but most of the
00:08:50
mostly it's not going to change from,
00:08:53
you know, not going to change our deal.
00:08:54
We like the deal we got. Um we again own
00:08:57
our things and so uh we're happy to take
00:09:00
suggestions from, you know, the same
00:09:02
thing like Jim will suggest something.
00:09:03
will either ignore him or will not like
00:09:05
he might have a he just had a great idea
00:09:07
to this morning for me. Um and I'll take
00:09:10
it. Uh so and I really do think of James
00:09:13
Murdock has always been very smart
00:09:14
digitally. I think um uh I think I we I
00:09:18
like him. He's not you can't just put
00:09:20
Murdoch on it and say they suck. I I
00:09:23
would agree about Rupert Murdoch. I
00:09:25
would not be owned by Rupert Murdoch and
00:09:27
uh and we're not owned by anyone. So I
00:09:29
think that's it. Anything else? Well,
00:09:31
when Reuters called me, I said, "Look,
00:09:32
we like the gyms and we have, you know,
00:09:35
we have a lot of power here and we
00:09:36
didn't ask for anything. We just asked
00:09:37
for everything to stay the same. I sell
00:09:40
>> Pivot is a joint venture between
00:09:42
Swisser, Galloway, and Vox. You own on I
00:09:44
own PropG, but both on and PropG uses
00:09:47
Vox for we do a revenue split where they
00:09:50
sell our ads. And if we could have I
00:09:53
mean, this is going to sound
00:09:54
self-absorbed. We could have killed this
00:09:56
deal. And we didn't. And we just we
00:09:59
didn't ask for anything extra. We just
00:10:01
said, "Yeah, we just want things to stay
00:10:03
the way they are." And Jim Bangoff has
00:10:06
never once
00:10:08
asked me to tone it down, to stop the
00:10:10
dick jokes, to reconsider.
00:10:13
>> That doesn't work.
00:10:14
>> No, you have. But you're you're trying
00:10:15
to save me from myself, and you're also
00:10:16
posing for your woke friends.
00:10:18
>> Oh, stop it. You're so much woker than
00:10:20
No.
00:10:21
>> Anyways, I'm so much wer than you. I'm
00:10:22
the woke.
00:10:25
>> But let me go to just some of the the
00:10:26
learnings here. And
00:10:29
Basically, the business model for tech
00:10:31
has been find have great technology,
00:10:34
find a very compelling leadership team
00:10:36
that's able to craft a narrative to
00:10:38
raise more capital than anyone else,
00:10:40
deliver an unbelievable product at below
00:10:42
price and then consolidate the market
00:10:44
and then start sucking the oxygen out of
00:10:46
the entire ecosystem. So, let me give
00:10:48
you an example. And then everybody else
00:10:50
gets crushed. Google and Meta have been
00:10:53
increasingly pushing users away from
00:10:54
external sites in in favor of their AI
00:10:57
overviews which they can monetize. So
00:10:59
Huffpo
00:11:00
between 2022 and 2025, so basically the
00:11:03
last 3 years that we have data on this,
00:11:04
Huffpost's organic search traffic has
00:11:07
been cut in half. The Washington Post
00:11:10
down by nearly half. Business Insider
00:11:13
has seen their organic traffic cut in
00:11:16
half. NT organic search as a as a share
00:11:19
of their total traffic fell from roughly
00:11:21
44% to 36.5%.
00:11:24
And the Wall Street Journal's organic
00:11:26
search as a as a share of their total
00:11:27
traffic fell from 29% to 24%. And let me
00:11:31
just go back in history and pat myself
00:11:33
on the back in 2006 when I joined the
00:11:36
board of the New York Times and
00:11:37
literally my first meeting I said they
00:11:39
said okay you're the digital guy which
00:11:41
we do. I'm like shut off Google. Don't
00:11:43
let them crawl your content because
00:11:45
eventually they're going to commoditize
00:11:47
your content,
00:11:48
>> right?
00:11:48
>> Stop driving traffic to us and all
00:11:51
you're doing is building them into the
00:11:53
ultimate toll booth.
00:11:54
>> That's correct.
00:11:55
>> And Martin Nenholtz, who's a very smart
00:11:56
guy, said, "Well, if we can't figure out
00:11:58
a way to compete against Google and
00:11:59
we're making money from the traffic they
00:12:01
send us, then shame on us." I'm like,
00:12:03
"Yeah,
00:12:04
go to go to Murdoch, go to the New
00:12:07
Houses, go to the Financial Times and
00:12:10
consolidate and turn off Google and then
00:12:15
license your content to the highest
00:12:17
bidder." And at that point, Microsoft
00:12:18
had Bing and we would have been able to
00:12:20
get a lot of money and say, "Look, if
00:12:22
you if you want to crawl this gorgeous
00:12:24
content from Thomas Freiedman and from
00:12:27
Vogue and from the FT, you got to pay
00:12:29
us." But instead they said no, we like
00:12:32
the traffic. They were pursuing this
00:12:33
eyeballs thing and now it's way too late
00:12:36
and these companies are the internet and
00:12:40
very few people go directly to NY the
00:12:42
New York Times.com. They get served
00:12:45
stuff on Meta. That's how they decide
00:12:46
where they're going or the the Google is
00:12:49
now entirely they don't take you to the
00:12:51
best place. They take you to a place
00:12:53
they can further monetize. And Jim, you
00:12:57
know, Jim is managed to get on the last
00:12:59
helicopter out of Saigon.
00:13:01
>> Oh, wait. Do you want to hear some of
00:13:02
the threads I thought of? I thought I'll
00:13:04
be I'll test the limits of our new
00:13:06
ownership.
00:13:07
>> I was walking around Lisbon yesterday
00:13:08
and it was beautiful and I was bored.
00:13:10
>> So, as soon as I saw the announcement, I
00:13:12
thought, I'm going to test the limits of
00:13:13
my freedom. My first thread, my first
00:13:15
thread was alternative media is like a
00:13:17
vegan restaurant. Virtue signaling loses
00:13:20
money and a billionaire bails you out.
00:13:22
That was my first one. My second one was
00:13:24
that that picture of Jim Brooff and
00:13:28
James Murdoch where it looks like the
00:13:29
30-year reunion of Abbercrombie and
00:13:31
Pitch. They're both very handsome.
00:13:32
>> They're very handsome.
00:13:34
>> And I wrote Romeo and Michelle's high
00:13:35
school reunion 2 post transition. That
00:13:38
one I'm especially proud of. And
00:13:41
>> oh, okay, last one. And then we
00:13:43
>> What was What was my What was my third
00:13:45
one? Oh god. I wrote something about Oh,
00:13:47
no. It just, you know, late late stage
00:13:49
capitalism. But anyways, and and then I
00:13:53
started doing it and I'm sitting there
00:13:54
in the park and I'm like,
00:13:55
>> do I really need to be an [ __ ]
00:13:57
>> Not today. Yeah, tomorrow. I'm like,
00:14:00
give them their moment.
00:14:01
>> Give them their moment.
00:14:02
>> Give them their moment.
00:14:03
>> They'll be an [ __ ] later
00:14:04
>> before we start making their lives
00:14:06
difficult.
00:14:07
>> No, you know what? Let me let me just
00:14:09
end this because we got to end this. So,
00:14:10
two things. Jim B, he said, we don't we
00:14:13
can say whatever we want. I don't see
00:14:15
that problem from James Murdoch or
00:14:17
Katherine Murdoch at all. They might be
00:14:18
irritated by us, but there's no going to
00:14:20
be no change in that. And let me be I
00:14:22
hate to say this, but Rubert Murdoch
00:14:24
never asked me to change a thing. Like
00:14:26
that is one thing I never experienced
00:14:28
when I worked at the walls. I just don't
00:14:29
I think he's a heinous piece of well I
00:14:32
think he's heinous the way he he's done
00:14:34
Fox News and the other stuff, but and
00:14:36
has degraded democracy quite a bit, but
00:14:39
he's not James is not him. And so, but
00:14:42
but that said, and Murdoch never meddled
00:14:44
in my stuff and and he certainly could
00:14:46
have um for for my entire time there. I
00:14:49
just didn't like him. Um but um but one
00:14:52
of the things we have to say, we we get
00:14:53
to do what we want. We will do what we
00:14:55
want. And also just I know Scott was
00:14:57
sort of putting a sort of an ugly
00:14:59
picture on it, but actually New York
00:15:00
Magazine is uh profitable. So are the
00:15:02
pod the podcast networks are doing great
00:15:04
and very profitable. Uh a lot of these
00:15:06
websites are. So, it's not like it's
00:15:08
just not a like a it's not a crazy
00:15:11
business, but it's not these are not
00:15:13
suffering properties. And last of all, a
00:15:15
lot many of them most of them provide
00:15:17
amazing journalism. Uh, and I I think
00:15:20
David Haskell deserves all due credit
00:15:21
for New York Magazine winning that
00:15:23
award. And awards are one thing, but
00:15:25
they certainly they were up against some
00:15:26
amazing uh journalism this year from The
00:15:29
Atlantic and from ProPublican Wired. Uh,
00:15:31
so uh they're very good property. He's
00:15:33
bought some good properties here um in
00:15:35
that regard. It's not they're not
00:15:37
falling knife properties. Um, but we'll
00:15:39
see what we can do. Let's see what he
00:15:41
does.
00:15:41
>> They make money, but the the crown
00:15:43
jewel, shockingly, of all this is the
00:15:46
podcast. New York Magazine is a vanity
00:15:49
asset.
00:15:49
>> It is, but it does. Okay. It doesn't
00:15:51
It's not It does fine.
00:15:52
>> You become one of the sexiest men in
00:15:54
Soho when your rap is I own New York
00:15:56
Magazine.
00:15:56
>> We're going to stop there. It's a very
00:15:57
It does journalism, too. Anyway,
00:16:00
>> that's
00:16:02
So is NPR. It doesn't make any money.
00:16:04
it. Yeah, but this one does. So, anyway,
00:16:06
speaking of things not making money, we
00:16:08
have some IPO news to get to. First up,
00:16:11
SpaceX has filed an IPO prospectus, and
00:16:14
it is revealing the company brought in
00:16:16
$791
00:16:18
million in profit in 2024. It swung back
00:16:20
to $4.9 billion in losses in 2025. For
00:16:24
context, 200 companies in the S&P 500
00:16:26
had more revenue than SpaceX last year,
00:16:29
including Tesla. also revealed in the
00:16:31
file, by the way, they buy a lot of
00:16:32
stuff from Tesla. There's a lot of
00:16:34
roundt tripping happen at the these
00:16:36
companies. It also reve all all
00:16:37
controlled by Elon Musk. It also
00:16:40
revealed in the filing, Anthropic is
00:16:41
paying SpaceX and thank God for it,
00:16:43
$1.25 billion per month through uh May
00:16:46
2029 as part of the compute deal that
00:16:49
two signed, meaning Grock will not be
00:16:50
using that space in Colossus 1 and two.
00:16:53
SpaceX is reportedly targeting targeting
00:16:55
a $1.7 trillion valuation. I mean it
00:16:58
goes on and on and on. on a lot of these
00:17:00
a lot of words like um human I don't
00:17:04
know like connection there's AI
00:17:07
mentioned a lot just it's this business
00:17:10
is not economically and mass speaking
00:17:12
it's not worth 1.7
00:17:15
I mean it's just the Elon that that guy
00:17:17
gets a lot of uh credit for for for
00:17:20
using this number um because even the
00:17:22
stuff they're promising seems
00:17:24
problematic but he's not he hasn't done
00:17:27
it before he just moves from one lily
00:17:29
pad to the other in terms of from Tesla
00:17:31
to this. But the big the big winner in
00:17:33
this in that I read is Starlink does
00:17:36
great. The others Grock and um the
00:17:39
rocket company is not so much. Go for
00:17:42
it.
00:17:42
>> I got a lot.
00:17:44
>> Okay, good. I can't wait. I'm excited.
00:17:46
>> Yeah. What was
00:17:48
>> Spit it out, Scott.
00:17:49
>> At 3:00 a.m. I was reading the S1. What
00:17:51
were you doing?
00:17:52
>> I know you were.
00:17:53
>> First off, I have some notes here. The
00:17:54
first 14 pages of the S1
00:17:57
>> are pictures of rockets.
00:18:00
>> AI is mentioned 1,200 times in the S1.
00:18:03
There are 277 pages of the perspectives.
00:18:05
For context, it's longer than The Great
00:18:07
Gatsby and The Catch in the Rye. And
00:18:09
some direct quotes from the filing.
00:18:11
These are direct quotes. We do not want
00:18:13
humans to have the same fate as
00:18:15
dinosaurs. Well, thank God you're here,
00:18:18
Elon. For decades, a reality where
00:18:21
humanity travels between the planets and
00:18:23
the stars has felt tentalizingly close.
00:18:25
But still,
00:18:26
>> would you mind if I ate my protein bar
00:18:27
where you do this because I'm hungry and
00:18:29
I also am fascinated. Keep going.
00:18:30
>> For for decades, a reality where
00:18:32
humanity travels between the planets and
00:18:33
the stars has felt tantalizingly close,
00:18:36
but still locked in the pages and
00:18:39
screens of science fiction. The sun
00:18:41
contains approximately 99.8% 8% of the
00:18:44
solar systems energy. And as a result,
00:18:46
we believe it is the only truly scalable
00:18:49
solution to terrestrial energy
00:18:50
constraints in the age of AI.
00:18:53
Oh, Jesus [ __ ] Christ. All right,
00:18:55
hold on.
00:18:56
>> Woke.
00:18:56
>> We believe the next paradigm shift for
00:18:58
humanity is the creation of a resilient,
00:19:00
perpetually expanding, space fairing
00:19:02
civilization. Ultimately,
00:19:04
>> sexy voice, please. I mean, I need a
00:19:06
more sexy. ultimately preparing us to
00:19:08
Kardashev type 2 status defined as
00:19:11
defined in the filing itself as a
00:19:13
civilization that harnesses the full
00:19:15
energy output of the sun. Remember we
00:19:18
work its mission was to elevate the
00:19:20
world's consciousness.
00:19:21
>> Yes. No, this seems like he sounds like
00:19:22
a Mayan. He sounds like a Mayan but go
00:19:24
ahead.
00:19:25
>> So let's talk about the numbers here.
00:19:27
Headline valuation 1.8 trillion. He
00:19:29
they're whispering they can go out at
00:19:31
two. That's roughly the GDP of Canada.
00:19:35
So let that marinate. that the core
00:19:36
business is genuinely an excellent
00:19:39
business,
00:19:40
>> right?
00:19:40
>> Starlink generated 3.26 billion in
00:19:43
revenue in a single quarter with 1.2
00:19:45
billion in operating income. That's 36%
00:19:47
operating margin on a monopoly satellite
00:19:49
inner business, internet business with
00:19:51
no serious competitors in sight. It's a
00:19:53
great business. If this were the whole
00:19:55
company, it would be one of the great
00:19:57
businesses of our era. And then, but the
00:20:01
problem is it's not. Stapled to this
00:20:04
rocket ship is XAI, a business that is
00:20:07
clinically speaking a money furnace. In
00:20:11
2024, XAI lost 1.6 billion on 2.6
00:20:15
billion in revenues. By 2025, losses
00:20:17
ballooned to 6.5 billion on 3.2 billion
00:20:20
in revenue. So revenue revenue went up
00:20:24
20% but losses went up 310%. That's
00:20:27
>> Can I ask you quickly, these revenues
00:20:29
don't seem like killer? It's 30%. It's
00:20:32
not like wow. It's they're not wow
00:20:34
growth, right? Is it's sort of good
00:20:36
solid. Am I wrong there?
00:20:39
>> No, it's Well, let's just let's just
00:20:42
talk about SpaceX, the best business.
00:20:44
It's growing 20% a year and it's trying
00:20:47
to go out at 100 times revenue. When
00:20:49
Google went public, it was growing 240%
00:20:51
a year and went out at 10 times
00:20:52
revenues. So, just back to back to XAI.
00:20:57
XI is losing money on the way to losing
00:21:00
more money in in Q12 2026 alone the net
00:21:05
loss of 4.3 billion on 4.7 billion in
00:21:07
revenue total capex 10.1 billion in 90
00:21:10
days 7.8 8 billion of that uh for AI.
00:21:14
Cash on the balance sheet um cratered
00:21:17
from 25 billion to 16 billion in just 3
00:21:20
months. They burn 9 billion in cash in a
00:21:23
single quarter. That's a hund00 million
00:21:25
a day. That's not investing in the
00:21:27
future. It's it's the future billing you
00:21:30
in advance,
00:21:31
>> right? Can this anthropic thing is
00:21:32
critical. Do you think he's moving into
00:21:34
being the infrastructure player rather
00:21:36
than the AI player here? building and
00:21:39
providing infrastruure. Tim him having
00:21:40
spent too much capbacks thinking that
00:21:43
>> X AI his AI would need it and he woke up
00:21:45
and realized he didn't. It's like this
00:21:47
has happened to me a million. Every time
00:21:49
I start a company, I raise too much
00:21:51
[ __ ] money. I go get a giant office
00:21:53
base in Soho and before I know it, I'm
00:21:55
renting it out to a bunch of shitty
00:21:56
startups to try and recoup some of the
00:21:58
capital. That's what h happened here,
00:22:00
>> right?
00:22:00
>> Total debt is for that, right?
00:22:02
Presumably from the anthropic,
00:22:04
>> total debt on the balance sheet is 29
00:22:06
billion. Um, so just for context, that's
00:22:10
more debt than it's on the Delta
00:22:11
Airlines, United Airlines, and American
00:22:13
Airlines combined with all their planes
00:22:15
and and those they carry passengers.
00:22:18
SpaceX has Starship, which has cost over
00:22:21
15 billion in development and is still
00:22:22
on its 12th test mission. The bottom
00:22:25
line, you're being asked to pay 1.75
00:22:28
trillion for a great satellite internet
00:22:31
company, a rocket business that loses
00:22:33
money, an AI product losing 6 billion a
00:22:36
year and falling further behind its
00:22:38
competitors that has 29 billion in debt,
00:22:40
and a CEO who, and this is my favorite
00:22:43
part of the filing, purchased $131
00:22:46
million of his own recalled cyber trucks
00:22:50
with company cash.
00:22:52
>> Right. He's propping up Tesla. Propping
00:22:55
up Tesla. Right.
00:22:56
>> So, in some Starlink is the golden
00:22:58
goose, an amazing company. Everything
00:23:00
else is Elon's hobbies. And at this
00:23:02
valuation, you're paying full price for
00:23:06
all of them. So, you know, Snow White is
00:23:11
[ __ ] hot, but you gota if you marry
00:23:13
her, you're taking on these little
00:23:15
nonvalue ad weirdos. Uh this is so this
00:23:21
company you have an amazing company
00:23:24
buried in all of these other money
00:23:26
furnaces,
00:23:27
>> right? I like money.
00:23:28
>> He's asking you to pay essentially 100
00:23:31
times revenue.
00:23:32
>> People will so talk about that because
00:23:35
look it is not I I read it. I'm like,
00:23:37
"Wow, this is not a there's one good
00:23:39
business in there, right? Really good
00:23:41
business." And and by the way, easy to
00:23:44
disrupt that business by the people will
00:23:46
come into this business and there'll be
00:23:47
more competitors. Um and uh and so that
00:23:51
that's my worry about Starlink is like
00:23:53
sure he has the win for today. It
00:23:55
doesn't mean he will have the win
00:23:56
forever just like Tesla. Um, the second
00:23:58
thing is it will it doesn't matter
00:24:01
because people will just buy into this
00:24:03
and run it up because it's him and these
00:24:05
promises which you left out a little bit
00:24:07
here is there's going to be all these
00:24:08
robots in your home. There's going to be
00:24:10
he he made a lot of promises in this in
00:24:13
this perspectus too about the future
00:24:16
like you have to assume he's going to
00:24:18
kill it in robots and by the way I have
00:24:20
heard from many people his robot
00:24:22
technology is really advanced but it has
00:24:24
to get to people right it's got to it's
00:24:27
got to get to people it's got to become
00:24:28
a product um and so just hand it feels
00:24:32
very hand wavy this entire thing but I
00:24:34
don't think it's going to matter I mean
00:24:35
be be a Wall Street person and say you
00:24:38
know what would you do as an investor
00:24:39
faster here.
00:24:40
>> Uh you might want to play it for the
00:24:41
pop, but I actually think that there's
00:24:43
going to be a ton of bill people and
00:24:45
analysts that will look at this thing.
00:24:47
The more scrutiny on this thing, the
00:24:49
worse it's going to be for the IPO and
00:24:52
does it go out at 1.8 trillion? I
00:24:54
wouldn't be surprised if the bankers try
00:24:55
and manufacture scarcity and it gets a
00:24:58
small pop, but I think by the end of the
00:25:00
year it's well below a trillion dollars.
00:25:02
There's just no there's no way to
00:25:04
justify this thing is a cash
00:25:06
incinerator.
00:25:08
And also certain components of the
00:25:09
business feel very weiworky in the fact
00:25:11
that as they grow they burn more cash.
00:25:13
There's no operating leverage.
00:25:14
>> Yeah. Yeah. Even with even with this
00:25:16
entropic deal because that's all he can
00:25:18
sell. That's right. It's like he's
00:25:19
selling the chairs or something. Right.
00:25:22
I mean
00:25:23
>> he built out infrastructure for that he
00:25:25
doesn't need because his his AI is not
00:25:27
growing the way.
00:25:28
>> Right. Exactly. And he's got it. He's
00:25:29
got this colossus and of course he's
00:25:30
facing lawsuits all over the place
00:25:32
because he's going to buy more of these
00:25:34
methane engines. That's going to and
00:25:36
trust me that they're going to put a
00:25:37
stop to that eventually. Um, so so what
00:25:41
would you how would you do it here?
00:25:42
People are listening. What would you do
00:25:44
here?
00:25:45
>> I won't tell you what to do because I
00:25:47
have been wrong about Tesla. I thought
00:25:49
Tesla was a sell in 2017 and it's gone
00:25:51
up 8x.
00:25:52
>> No, you were right. But you were wrong
00:25:53
about what people would do.
00:25:54
>> I think we have to squarely say I was
00:25:56
wrong.
00:25:56
>> Okay.
00:25:57
>> So what I'm going to do is if someone
00:25:59
called me and no one's going to call me,
00:26:01
but if Elon Musk called me and said, "Do
00:26:02
you want allocation in the IPO?"
00:26:04
I would probably say sure and I'd sell
00:26:06
it on the first trade. They will
00:26:08
manufacture scarcity. Goldman and
00:26:11
everybody will tell him, "Okay, this is
00:26:12
what it looks like." Put out press
00:26:13
releases saying you're 30 times over
00:26:15
subscribed. It'll get a pop and then get
00:26:18
out again. An amazing business can be a
00:26:21
shitty investment even at some
00:26:24
valuation. And a shitty business can be
00:26:25
an amazing investment at a certain
00:26:28
valuation. This is an amazing business
00:26:31
surrounded by businesses that are not
00:26:33
scaling where he's trying to play
00:26:34
catchup and at a valuation that makes
00:26:37
just abso fuckingutolutely no sense.
00:26:40
>> Yeah.
00:26:40
>> So what I would do X AI in here was a
00:26:44
way to save his ass, his own ass.
00:26:46
Correct.
00:26:47
>> It's a it's it's the cheapest form of
00:26:50
capital he could find by attaching it to
00:26:52
an amazing business such that he could
00:26:54
try and catch up. And even the business,
00:26:57
even the amazing business on its own
00:27:00
which is doing 16 billion in topline
00:27:02
revenue and 8 billion in IBIDA
00:27:04
>> this is Starlink.
00:27:05
>> Yeah. I don't know give it 25 you know
00:27:10
give it a 100 times IDA it's worth 800
00:27:13
billion. 100 times I zeba is no you know
00:27:16
no one trades at that. But you not only
00:27:19
are trying to to get it out at 1 and a
00:27:22
1.7 to 2 trillion, you've attached onto
00:27:25
it all of these businesses that look to
00:27:28
have negative leverage.
00:27:30
>> Andy's using the business to help Tesla
00:27:32
out by buying shitty Cyber Trucks and
00:27:34
everything else.
00:27:34
>> Well, that was the most that was the
00:27:36
most eye popping thing.
00:27:37
>> I know. I agree.
00:27:38
>> Was that it reminded me of and this is
00:27:41
the argument against when corporate or
00:27:43
when governments decide to get start
00:27:45
cosplaying business. the the Irish
00:27:47
government or the UK government said
00:27:49
Delorean is the future and they give
00:27:50
them a bunch of loans and then these
00:27:52
pictures came out of a ton of Deloreans
00:27:55
sitting in a warehouse in Ireland
00:27:57
unsold.
00:27:58
>> So
00:28:00
the the worst product arguably the worst
00:28:03
tech product maybe than the Oculus or
00:28:06
Siri, the worst tech product of the last
00:28:08
decade is hands down the Cybert truck.
00:28:10
>> Cyber Truck. So he went out, a bunch of
00:28:12
them recalled, and he used money from
00:28:14
this organization to buy to buy back
00:28:16
Cybert trucks. You're not supposed to do
00:28:18
that. You're supposed to say, "Okay,
00:28:20
Tesla Tesla has a a a turd of a product
00:28:24
and we're going to take a right down."
00:28:25
And you just take your, you know, you
00:28:27
take your pain. This is Elon brings a
00:28:31
level of awareness, magic. People have
00:28:34
done investing with him. He is an
00:28:36
unbelievable visionary.
00:28:38
But uh you know this goes to something
00:28:40
broader and that is this is all part of
00:28:45
an entity that will cement where I
00:28:47
believe we are now and that is I finally
00:28:49
believe we are squarely in 1999.
00:28:51
>> Yeah I would agree with you. That's what
00:28:53
I felt after looking at I didn't look at
00:28:55
over as carefully but I thought oh no no
00:28:56
no this is not good. This is you know
00:28:59
all I don't really care about the
00:29:01
luminous humanity [ __ ] and flying to
00:29:03
the stars and the sun is going to power
00:29:06
our world. Like that's all his I I I've
00:29:08
had to listen that nonsense from him for
00:29:10
many years and great. I'm glad you think
00:29:13
that. I mean, I don't really care if
00:29:14
everyone if that's what turns him on.
00:29:16
That's great. But it was the the Tesla
00:29:18
thing. There was a several things in
00:29:20
here that were very speaking of
00:29:23
latestage capitalism. I felt it was late
00:29:25
Elon, right? That's what that's what it
00:29:28
felt like to me. But just we'll see.
00:29:30
>> Look, it his job is to get capital as
00:29:33
cheaply as possible. He's going to do
00:29:35
that. Yeah. I think it's smart for him
00:29:37
to do this.
00:29:38
>> That's good for him. Yeah.
00:29:39
>> But I think investors in some if you
00:29:42
look at what happened.
00:29:44
>> So there was a really interesting
00:29:45
analysis done in the FT and that is at
00:29:47
the peak of the dotcom boom about 60% of
00:29:51
GDP growth was coming from capex related
00:29:53
to telco infrastructure and the
00:29:55
internet. It's now 93% is coming from AI
00:29:59
including and I'm loosely and also these
00:30:01
companies will be grouped into that. In
00:30:02
addition, the total capex
00:30:06
inflation adjusted was about 850 billion
00:30:09
in 99 up until that point. Now we're at
00:30:12
about 1 and a.5 trillion.
00:30:14
>> And every time you have over 2 or 3% of
00:30:17
GDP going into the buildout or capex or
00:30:19
something, whether it's railroads or
00:30:21
highways or the telco infrastructure of
00:30:23
the late '9s, two years later, there's a
00:30:26
crash. Two to three years later, there's
00:30:28
a crash. Railroads, all of it.
00:30:30
>> We are there. and and one of these
00:30:32
companies or more of them is going to
00:30:34
experience what every big tech company
00:30:35
has experienced when they're get out
00:30:37
over their skis and that is you're going
00:30:40
to see a 70 to 95% decline in the value
00:30:42
of one or more of these companies.
00:30:44
Nvidia, I mean all these companies are
00:30:47
there's the the expectation
00:30:50
of they're increasing their capbacks 20%
00:30:53
a year while increasing their revenues
00:30:55
optimistically 15% a year. That's
00:30:58
negative operating leverage. And
00:31:00
eventually the music's going to stop
00:31:02
here.
00:31:02
>> Yeah, I felt drunken sailors had a feel
00:31:04
of this. I don't know. I just like
00:31:06
>> Well, the way I would describe it is I
00:31:07
think Nvidia is a casino
00:31:09
and we're all drunk people at the
00:31:11
blackjack pay table and
00:31:13
>> it will affect very good businesses and
00:31:15
then along with the tariffs and all the
00:31:17
other corruption around Trump. It just
00:31:19
gets to be a real problem here.
00:31:21
>> Nvidia is an amazing business. SpaceX is
00:31:23
an amazing business. They should, oh my
00:31:25
god, they should be worth they should be
00:31:27
worth a trillion dollars and 300 billion
00:31:29
respectively. So down about 50 to 80%.
00:31:34
And the technology I think the
00:31:37
technology will live up to its
00:31:38
expectations more on the optimistic side
00:31:40
than the pessimistic side, but the
00:31:42
valuations won't.
00:31:43
>> Yeah. All right. Well, speaking of
00:31:44
which, OpenAI is preparing to
00:31:45
confidentially file a draft of its IPO
00:31:47
perspective as soon as Friday. I expect
00:31:48
you to read it over the weekend and tell
00:31:50
me about it next week. Um, as you're
00:31:52
listening to this, the company is valued
00:31:54
at over $850 billion by private
00:31:56
investors. The things I'm looking at
00:31:58
there is all the cross investments with
00:32:00
Altman involved. I'm probably interested
00:32:02
in that. Um, where the where their where
00:32:05
the trends are in terms of their
00:32:07
subscriptions. Um, and where their spend
00:32:09
is. I think those are the things I'm I'm
00:32:12
looking at. What are you looking at
00:32:13
there very briefly? Well, just to
00:32:15
distill it, to justify the $1 trillion
00:32:17
valuation that OpenAI is pursuing at its
00:32:19
IPO, it needs to grow from 13 billion in
00:32:22
revenue to the to the size of today's
00:32:24
Microsoft in four years. So, they're
00:32:27
saying they're going to be the size of
00:32:28
Microsoft in four years. And I just
00:32:30
don't think revenue did triple to 13
00:32:32
billion, but the company burned 9
00:32:34
billion. And right now, it has negative
00:32:36
momentum relative to Anthropic. And what
00:32:39
they have said is get out right away. We
00:32:41
need the perception that we're the
00:32:43
leader. And also Sam Alman looks at
00:32:45
SpaceX and says there's not room for
00:32:49
there's only so much retail money that's
00:32:51
going to come into the ecosystem. Get
00:32:54
out because it's going to dry up because
00:32:56
if SpaceX goes out of pop and comes
00:32:59
down, retail investors are going to
00:33:01
start to get queasy and then when you
00:33:03
have these enormous IPOs,
00:33:05
in other words, at some point retail
00:33:07
investors are going to run out of money
00:33:08
to invest in these things. So he's like,
00:33:10
"Get out." And the CFO, Sarah Frier, who
00:33:12
I'm shocked still has a job because
00:33:14
she's not towing the company line. She
00:33:16
worked at Goldman and Mckenzie, has
00:33:18
reported previously that colleagues uh
00:33:21
to colleagues at OpenAI saying, "We're
00:33:23
not ready for an IPO because the risk
00:33:25
from its spending commitments."
00:33:27
>> Yeah, I know her. She's a very She's
00:33:29
like that. She's
00:33:30
>> like a Ruth Barrett. She's an adult.
00:33:31
Yeah.
00:33:31
>> The the company is committed to spending
00:33:33
600 billion over the five years across
00:33:35
vendors and their Oracle deal alone
00:33:37
requires 60 billion a year starting in
00:33:39
2027. nearly five times OpenAI's entire
00:33:41
2025 revenue.
00:33:43
>> So
00:33:43
>> again, this is we are squarely a 99
00:33:47
>> 99. All right. Well, we'll go with that.
00:33:49
All right, Scott, let's take a quick
00:33:50
break. When we come back, Jeff Bezos, so
00:33:52
good God. Speaking of billionaires
00:33:54
behaving badly, speaks out on all sorts
00:33:56
of things.
00:33:59
Support for the show comes from Indeed.
00:34:01
When you're looking for talent, Indeed
00:34:02
sponsored jobs can just be the boost you
00:34:04
need. It matches you with quality
00:34:06
candidates fast, so you don't need to
00:34:08
spend months searching for that new
00:34:09
hire. According to their data, sponsored
00:34:12
jobs posted directly on Indeed are 95%
00:34:15
more likely to report a hire than
00:34:16
non-sponsored jobs. Join the 3.3 million
00:34:20
employers worldwide that use Indeed to
00:34:22
connect with quality talent that fits
00:34:23
their needs. Spend less time searching
00:34:25
and more time actually interviewing
00:34:27
candidates who check all your boxes.
00:34:29
Less stress, less time, more results.
00:34:31
When you need the right person to cut
00:34:32
through the chaos, this is a job for
00:34:34
Indeed sponsored jobs. And listeners of
00:34:37
the show will get a $75 sponsored job
00:34:39
credit to help get your job the premium
00:34:41
status it deserves at
00:34:43
indeed.com/mpodcast.
00:34:46
Just go to indeed.com/mpodcast
00:34:48
right now. And support our show by
00:34:50
saying you heard about Indeed on this
00:34:51
podcast. That's indeed.com/mpodcast.
00:34:55
Terms and conditions apply. Need the
00:34:57
ride hire fast? Then this is a job for
00:34:59
indeed sponsored jobs.
00:35:02
>> Scott, we're back. Jeff Bezos sat down
00:35:04
for an interview with Andrew Ross
00:35:06
Sorcin, our favorite Canadian on
00:35:07
Wednesday. Let's talk about some of the
00:35:08
things he said. First up, Bezos said
00:35:10
that Trump was more mature and more
00:35:12
disciplined in his second term. The
00:35:13
Washington Post owner defended massive
00:35:15
cuts he made to the newsroom earlier
00:35:16
this year, saying he doesn't want a post
00:35:18
to be a charity. I have some things to
00:35:20
say about that because I think he's the
00:35:21
one that drove it into a wall. Bezos
00:35:23
also backed the idea of eliminating
00:35:25
income taxes for the bottom half of US
00:35:27
earners. Let's hear what he said to say
00:35:29
about his own taxes.
00:35:31
>> People sometimes say that uh that you
00:35:34
know I don't pay taxes. So true. I pay
00:35:37
billions of dollars in taxes and it's a
00:35:39
per again if people want me to pay more
00:35:42
billions, right?
00:35:43
>> Then let's have that debate. But don't
00:35:45
pretend, you know, that this that that's
00:35:47
going to solve the problem. You could
00:35:49
you could double the taxes I pay and
00:35:52
it's not going to help that teacher in
00:35:53
Queens. I promise you.
00:35:55
>> Let's try.
00:35:56
>> Let's try.
00:35:56
>> Let's try. Let's see what happens.
00:35:58
>> Let's see what happens. Jeff,
00:35:59
>> if we take his effective tax rate from
00:36:01
16 or 17% to 32 or 34 like the rest of
00:36:04
us, I don't know. Let's just give it a
00:36:06
whirl.
00:36:06
>> Let's just give it a whirl. Let's see
00:36:08
what happens.
00:36:09
>> So disingenuous in this interview. Let
00:36:11
me let me start and then I'll let you
00:36:13
go. First up, the more mature. Come on,
00:36:16
Jeff. Like seriously. Like, I get that
00:36:19
there's a lot of face work going on and
00:36:21
a lot of other enhancements, but it's
00:36:23
gone to your [ __ ] head. Like, I get
00:36:25
what he means. It's good for me. Instead
00:36:27
of saying more mature, more disciplined
00:36:29
is he's more focused on giving me the
00:36:31
[ __ ] I want. That's I I would just
00:36:33
prefer that if he wouldn't mind like
00:36:35
saying that. Whatever. He can say what
00:36:38
he wants. He's never been a particularly
00:36:40
liberal person, but now he's just he's
00:36:42
just now being just as disingenuous. The
00:36:44
Washington Post thing drove me crazy
00:36:46
because he's the one who kept the same
00:36:48
management in place then hired an
00:36:51
incompetent like Will Lewis uh did
00:36:54
nothing that the New York Times took
00:36:56
moves after Trump left office to do
00:36:58
something. He he created all manner of
00:37:01
situations where people just just left
00:37:04
cut their subscriptions which were which
00:37:06
were slightly growing but they were
00:37:08
definitely stabilizing. And then after
00:37:09
he put his dirty little fingers in the
00:37:12
editorial process, he messed it up. A
00:37:14
huge exodus of talent blaming the talent
00:37:17
which then went to successful properties
00:37:19
like the Atlantic and many other and the
00:37:21
Wall Street Journal and other places
00:37:23
which are doing okay. They're doing
00:37:25
they're they're making businesses. New
00:37:26
York Times, Wall Street Journal, The
00:37:28
Atlantic, everything else. So, every
00:37:30
time he says this, I'm like, why don't
00:37:32
you look over at Lorraine Powell Jobs,
00:37:34
who's managed to do a very nice job over
00:37:36
there at the Atlantic by not meddling
00:37:39
and supporting and not losing money. Um,
00:37:42
the income tax thing I'll let you take,
00:37:44
but it was so full of disingenuous
00:37:46
stuff. And again, let's try Jeff. Even
00:37:49
if you pay billions, you have billions
00:37:51
and you pay the fact that I pay more of
00:37:53
a percentage of my taxes than you. And
00:37:55
then the corpor Don't even get me
00:37:57
started with corporations. So anyway, uh
00:38:00
the whole thing was and also he didn't
00:38:03
look well in my opinion and since he
00:38:06
spent so much time on cosmetic stuff, I
00:38:08
feel like I can comment upon this. Go
00:38:10
ahead.
00:38:11
>> Jeff Bezos pays himself $82,000, just
00:38:14
enough such that he can claim a child
00:38:15
tax credit, which by the way he takes,
00:38:18
and then he puts all of his additional
00:38:20
money and such that the value of his
00:38:21
shares go up. He borrows against those
00:38:23
shares, not not triggering a taxable
00:38:25
event. likely has a lot of those shares
00:38:27
in a trust. And then after leveraging
00:38:29
the unbelievable infrastructure and
00:38:31
culture of the great state of
00:38:33
Washington, he then
00:38:34
>> post office everything
00:38:36
>> takes his $120 billion in shares and
00:38:39
moves to Florida to spend more time with
00:38:41
his father and then starts selling
00:38:44
shares. Now granted, just as every
00:38:48
prisoner has an obligation to escape, I
00:38:50
think every individual has an obligation
00:38:51
to avoid taxes. I don't blame him for
00:38:53
tax evasion. I blame our government for
00:38:55
letting him engage in it. But quite
00:38:58
frankly, Jeff, when you start trying to
00:39:00
wallpaper over the tax avoidance of
00:39:02
billionaires by claiming you care about
00:39:04
nurses,
00:39:04
>> teachers,
00:39:05
>> sit the [ __ ] down. Just sit down. This
00:39:09
is a misdirect.
00:39:11
And it's like when Jensen talks about,
00:39:13
"Yes, tax me more." Okay,
00:39:17
thanks guys. But I just don't think
00:39:19
they're in a position when a guy has
00:39:21
when a guy has so optimized the dynamics
00:39:25
of supply and demand of labor such that
00:39:28
his delivery drivers have to pee in
00:39:30
bottles to make their correct
00:39:31
>> quotas. You're just not the person to
00:39:34
pretend to have empathy for that nurse
00:39:36
in Queens. So, I'm not even going to
00:39:39
I'll talk about his idea, but give me
00:39:42
the mother of all eye rolls when Jeff
00:39:44
Bezos
00:39:46
claims to be concerned about the tax
00:39:48
rates of the nurse in Brooklyn. What I
00:39:53
when I've advised or when I was talking
00:39:54
to Andrew Yang when he was running for
00:39:56
president mayor, I said, "You [ __ ] up.
00:39:57
It shouldn't be universal basic income.
00:39:59
It should be basic income." And to get
00:40:01
Republicans on board, you need different
00:40:02
frame it. Don't call it universal basic
00:40:04
income because it sounds like socialism.
00:40:06
call it a negative income tax.
00:40:08
Republicans love tax breaks. I do
00:40:11
believe there's something to the notion
00:40:13
of saying anyone who makes below $50,000
00:40:17
should not only not get taxed, but maybe
00:40:19
get a tax credit in the form of services
00:40:23
or maybe just cash quite frankly because
00:40:25
most of the studies show that when you
00:40:27
create a government infrastructure to
00:40:28
deploy social programs, they're
00:40:30
inefficient and never go away.
00:40:31
>> Just give them the money. Just give them
00:40:32
>> just give them the money. Just cut them
00:40:34
a check. You're in a household, you have
00:40:36
kids, whatever. They did a bunch of
00:40:39
studies in Africa, and quite frankly,
00:40:40
I'm going to be a sexist here. When they
00:40:42
give money to the men, the prostitutes
00:40:43
in the bars do well. When they give
00:40:45
money to the women, the kids get taller
00:40:46
and fatter. You couldn't do that in
00:40:48
America and just give money to single
00:40:49
mothers, which is what I would like to
00:40:51
see happen. But if you gave just gave
00:40:53
money, nationalized healthcare, there's
00:40:55
a lot of good taxation ideas. What he
00:40:58
said was very accurate is that if you
00:41:01
had a tax holiday for people under the
00:41:02
age of 30, he didn't say this, but if
00:41:04
you gave a tax holiday, which is what
00:41:05
he's saying, or cut the taxes of people
00:41:06
making less than $75,000, you don't lose
00:41:09
that much tax revenue. Because it is
00:41:11
true that only 1%, the top 1% in New
00:41:14
York pay 48% of the taxes and the bottom
00:41:17
25% really don't pay much. So, he's
00:41:19
right they wouldn't be giving up much.
00:41:21
But he is just not. We need an
00:41:24
alternative minimum tax on people like
00:41:25
Jeff Bezos. of I believe 60%.
00:41:30
Because the earner that's making 2
00:41:32
million bucks working her ass off as a
00:41:34
baller partner at Scatterenarps in
00:41:36
Manhattan is paying 54. And fine, maybe
00:41:39
she pays maybe the person making 10
00:41:42
billion or 10 million a year pays makes
00:41:44
60%, because here's the whole objective
00:41:47
of taxation.
00:41:49
You want the least taxing tax. If you
00:41:53
start attacking education and food and
00:41:56
housing, you end up
00:41:58
>> with homelessness. Yep.
00:41:59
>> Less educated people, people who put off
00:42:01
their mammogram and die of metastatic
00:42:04
breast cancer. Those are taxes that are
00:42:06
too taxing. An alternative minimum tax
00:42:09
on corporations making above a billion
00:42:11
dollars and people say making over 3
00:42:13
million a year. They don't lose any
00:42:15
happiness. The Baso and also do away
00:42:18
with the estate tax exemption. If the
00:42:20
Bezos children inherit 20 billion
00:42:22
instead of 30, no loss in happiness. But
00:42:26
that 10 billion that could potentially
00:42:28
be divided amongst the million the
00:42:31
$10,000 to the million poorest
00:42:33
households, a lot of incremental
00:42:35
happiness.
00:42:35
>> You know what the the contrast was? His
00:42:37
ex-wife. Like she doesn't say a word.
00:42:40
She doesn't do an interview. She gives
00:42:42
money.
00:42:44
No ribbon cutings, no cosplaying, no
00:42:47
whatever weirdness you're doing to your
00:42:48
body, Jeff. uh just and doesn't lecture
00:42:51
us. That's the tone was what was crazy.
00:42:54
I I I know I got like Ben about the post
00:42:56
stuff, but all of it had this tone. The
00:42:58
post stuff was disingenuous in the
00:43:00
extreme. He's the worst media owner of
00:43:02
any media owner and it's a low [ __ ]
00:43:04
bar. Let me tell you, I take Rupert
00:43:06
Murdoch twice every day of the week and
00:43:08
twice on Sunday to Jeff Bezos. At least
00:43:10
he understands media and likes it. Um,
00:43:13
you know, this the tone was so obnoxious
00:43:18
and this is why this general, you know,
00:43:20
he talked about people demonizing
00:43:22
billionaires. Well, stop stop talking.
00:43:25
stop appearing like I I honestly it it
00:43:28
the the the damage these people are
00:43:30
doing to the brand of capitalism, brand
00:43:33
capitalism and brand AI and brand tech
00:43:36
is so vast that you can see why these
00:43:40
polls are showing up like this way. I
00:43:42
know my own sons who both are incredibly
00:43:45
hard workers
00:43:47
and it has nothing to do with me. They,
00:43:50
you know, they often don't listen to me.
00:43:52
um they don't listen to anything I do at
00:43:53
least and and I'm fine with that. But
00:43:56
they have these feelings, right? It's
00:43:59
just it I don't know. It just and then
00:44:01
it gives rise to too much demonization,
00:44:04
right? Because of the way these people
00:44:06
behave. So I don't know.
00:44:08
>> So I have stories about McKenzie Scott
00:44:11
and Melinda French Gates. I'm involved
00:44:13
in two nonprofits. I'm involved in
00:44:15
something called the Jed Foundation that
00:44:17
tries to train high schools around how
00:44:19
to identify what is kind of normal
00:44:21
strange adolescent behavior and
00:44:22
adolescent behavior that should raise
00:44:25
red flags around depression and suicide
00:44:27
and they leverage the infrastructure of
00:44:29
public schools and educate them and they
00:44:31
are they are amazing. It was started by
00:44:33
a couple that lost their son Jed. It's
00:44:34
run by this wonderful management team.
00:44:36
They do a great job. Right after I sort
00:44:39
of got involved, they called me and said
00:44:40
they did a big thing event and they got
00:44:42
they go we got great news. I'm like
00:44:43
what's that? and he goes, "We got a $10
00:44:44
million wire yesterday and we're trying
00:44:46
to figure out who it's from." Mackenzie
00:44:49
Scott
00:44:50
didn't didn't want an RFP, didn't want
00:44:52
to meet with them, didn't want her name
00:44:54
on anything. She just wired 10 million
00:44:56
bucks. And then another association I
00:44:59
love, the American Institute for Boys
00:45:01
and Men, which focuses on the struggles
00:45:02
and mental health of young men and boys,
00:45:04
run by one of my role models, Richard
00:45:07
Reeves. Melinda French Gates, $10
00:45:10
million. recognizing the majority of her
00:45:13
funds are focused on the struggles in
00:45:15
gender equality and struggles of young
00:45:16
women. But she she said without thriving
00:45:19
young men, women aren't going to
00:45:21
continue to flourish. And she just sends
00:45:24
10 million bucks. And then someone who
00:45:25
shall remain nameless contacted the firm
00:45:28
and I get it. He's trying to be or
00:45:30
contacted one of these companies and
00:45:32
said, "Can I meet with so- and so and
00:45:34
Scott? I want to hear about the
00:45:35
strategy." And I'm like, typical [ __ ]
00:45:37
rich dude. We got to go sing for our
00:45:39
supper. We got to like
00:45:42
>> go talk to him as if it's a business and
00:45:44
return on investment. Whereas these
00:45:46
these women are just like you're doing
00:45:48
good work.
00:45:49
>> Yeah. Excellent. Here you go.
00:45:50
>> Get back to work.
00:45:51
>> You don't hear from him. They definitely
00:45:53
check you out. But it's not It is It's
00:45:56
such a different way of giving. I
00:45:58
>> It really is. There's something
00:46:00
>> I couldn't dislike Jeff Bezos more after
00:46:03
this interview. I thought I honestly
00:46:04
thought
00:46:06
could have pressed him harder. Honestly,
00:46:07
I didn't think Zoro pressed him hard
00:46:09
enough on this stuff and let him get
00:46:10
away with some stuff that I wish he had.
00:46:12
But I that said, we got to see him the
00:46:15
way he is. And that is the way he is.
00:46:17
Folks,
00:46:17
>> let me make the conservative or at least
00:46:19
give some sunshine to conservative part
00:46:20
of this. I can't stand it when people on
00:46:23
the far left say Jeff Bezos didn't earn
00:46:24
his money.
00:46:25
>> Oh, he did
00:46:26
>> because he was born to a single mother
00:46:28
at the at the age when she was 17.
00:46:32
I believe he deserves to have earned
00:46:34
$120 billion. I think we deserve to
00:46:37
elect people who have the backbone to
00:46:38
tax him at 60 or 80%.
00:46:41
But don't slow him down. He's not a bad
00:46:44
person,
00:46:45
>> right?
00:46:45
>> He's doing he's doing what we all do.
00:46:47
He's optimizing for his own
00:46:48
self-interest. You may you may just you
00:46:50
may say he's more self-interested than
00:46:52
some people. Fine. We're not doing our
00:46:55
job. Elizabeth Warren and Bernie
00:46:57
Sanders, you've been in Congress for
00:46:59
[ __ ] ever and the taxes keep going
00:47:01
down under your watch.
00:47:02
>> Yeah. Let's do something.
00:47:03
>> You want to demonize them? No. Tax him.
00:47:05
>> Tax him. That's the best way like to say
00:47:07
take look you whatever you want to do.
00:47:09
Now let me switch to another billionaire
00:47:11
because this was something that
00:47:13
happened. I we have not said a lot. Our
00:47:14
listen some of our listeners are not
00:47:16
going to like what I have to say here
00:47:17
and I don't really care but I do care
00:47:19
but I don't care. Um unexpected sighting
00:47:22
in DC this week. Mark Cuban standing
00:47:24
alongside President Trump. Cuban
00:47:25
endorsed Kla Harris was a big supporter
00:47:27
in 2024. It's been one of Trump's most
00:47:30
vocal critics, but the two appeared
00:47:31
together as the Trump announced a major
00:47:34
expansion of Trump RX's administration's
00:47:37
online drugstore. The site is adding
00:47:39
more than 600 lowcost generic
00:47:41
medications through partnerships with
00:47:42
Cuban's Cost Plus Drugs, Amazon
00:47:44
Pharmacy, and Good RX. At this event,
00:47:47
Trump was asked about his new alliance
00:47:49
with Cuban. It's only on this issue,
00:47:51
just for people to be clear. Let's
00:47:53
listen. It's pretty remarkable seeing
00:47:55
you and Mark Cuban up there and the fact
00:47:57
that obviously Mark endorsed Kla Harris
00:48:00
back in 2020.
00:48:00
>> Well, he made a mistake. It was a big
00:48:02
mistake.
00:48:04
But
00:48:04
>> what does this say about what you two
00:48:06
are building here? The important
00:48:07
>> Well, it says we love people. We love
00:48:09
our country. He wants to he's got a a
00:48:11
good company and he's going to do a lot
00:48:13
of business with this and uh I'm going
00:48:15
to get drugs out through Amazon through
00:48:17
the whole group and we're going to get
00:48:18
drugs out and uh Mark wanted to be a
00:48:21
part of it and I think Mark was very
00:48:24
gracious. He said this is something that
00:48:25
really works.
00:48:26
>> Cuban later posted on X, if anyone
00:48:28
thinks I'm going to put politics ahead
00:48:29
of helping Americans reduce their cost
00:48:31
of healthcare and pharmaceuticals, they
00:48:32
are a [ __ ] idiot. He took that down
00:48:34
because he thought swearing undercut his
00:48:36
argument. He's probably right. Um, let
00:48:38
me just say a few things. The stuff out
00:48:41
there about him making a bank or he's
00:48:44
mobbing up with Trump is it's just not
00:48:46
true. You don't have to like that he
00:48:48
stood there. I get it. I get it. I get
00:48:51
it. But he this this business is to get
00:48:54
drug prices down. He does not make a ton
00:48:57
of money here. He This is more It's not
00:49:00
a charity either. He's trying to build a
00:49:02
business. But this the the stuff that's
00:49:04
out there about what he's doing is just
00:49:07
inaccurate and it's not if you don't
00:49:09
like him standing there and you think he
00:49:11
betrayed you and I saw a lot of these I
00:49:13
now can't like him. I thought he was a
00:49:15
good guy. He is a good guy. He is doing
00:49:18
something that I'm sure makes him deeply
00:49:20
uncomfortable for a very good thing
00:49:22
which is to bring lower prices. He's got
00:49:24
to get in this Trump RX. He essentially
00:49:26
took control of Trump RX in a weird way
00:49:30
because you've got to get these things.
00:49:31
If Trump is doing this site and I hate
00:49:33
that Trump's name is on it, I hate it.
00:49:36
But look, he's an ego mana who puts his
00:49:38
name on every [ __ ] thing and there's
00:49:39
nothing we can do about it. And if he he
00:49:42
sat up there with Biden, you'd love him
00:49:43
for it or whoever a Democratic
00:49:45
president, he would sit up with anyone.
00:49:48
The only thing I would say was that I'm
00:49:51
not sure he got grretched. I sent him a
00:49:53
note. I said, "You just got gretched."
00:49:55
When he when he first he started talking
00:49:57
about this this $1.776
00:50:00
trillion slush fund for people who
00:50:02
criminals who attack the capital, I
00:50:05
don't know. He got grretched. He was
00:50:06
sitting there when Trump was going on
00:50:08
about something that's obviously
00:50:11
illegal or and also a slush fund. I
00:50:13
don't know what would he should he walk
00:50:15
out? Should he leave? I don't know. He
00:50:17
did laugh at the you voted for Kla
00:50:19
Harris. I'm not sure what you do in
00:50:20
situ. Should he have sat there and said
00:50:22
I still would? I don't know. He would
00:50:24
have gotten lost out this deal. I don't
00:50:27
know. And it's not great to have to
00:50:28
stand with Trump. We get it. We get it.
00:50:30
I wouldn't do it. But if I had something
00:50:33
that mattered a lot, I might. And the
00:50:35
only other thing I would say is Zoran
00:50:38
Mandani went there and stood right next
00:50:40
to Trump and everyone praised that. And
00:50:43
I the difference was is but he didn't
00:50:45
insult Trump and he didn't like slap him
00:50:48
or do anything rude. He also didn't say
00:50:51
much and he didn't get gratched. And so
00:50:54
he he needed something for New York and
00:50:56
he got it from Trump. And so I'm not
00:50:58
quite sure what the difference here is
00:51:00
because that's what I think was
00:51:01
happening here with Mark. And you can
00:51:03
hate on me all you want saying I love
00:51:05
the billionaires, but I think what he's
00:51:07
doing is an important thing for bringing
00:51:09
drug prices online and you cannot wait
00:51:11
for 3 years to do so. Your thoughts,
00:51:13
Scott? If your emotions and political
00:51:16
partisanship trump the health of
00:51:18
Americans, then the problem is you, not
00:51:20
Mark Cuban.
00:51:21
The partnership between Trump RX and
00:51:25
Cuban's cost plus drugs will unlock
00:51:29
millions of Americans
00:51:31
in terms of cheaper prices or unlock
00:51:33
cheaper prices for millions of
00:51:35
Americans. Uh, this week's expansion
00:51:38
adds 600 generics, nearly seven times
00:51:40
the previous catalog. They'll be
00:51:43
available to anyone regardless of
00:51:44
insurance status and in many cases the
00:51:46
cash price through cost plus is actually
00:51:48
lower than what insured pay uh insured
00:51:50
people pay at the pharmacy counter after
00:51:52
co-pays. Cost plus Drugs sells the
00:51:55
cancer drug I believe it's called a
00:51:57
tanamibanib
00:52:00
for $17. The same drug runs over $2,000
00:52:03
at conventionalies.
00:52:05
three PBMs um uh Optim RX, CVS Caremark
00:52:09
and Express Scripts control roughly 80%
00:52:11
of the US drug access and are untouched
00:52:13
by this deal. It look something has to
00:52:16
change. And I respect and the US
00:52:20
government has a scale and capital that
00:52:23
no one can match. And if you have
00:52:24
something that's good for America that
00:52:25
requires that scale and that capital,
00:52:28
then you act like a [ __ ] adult.
00:52:31
I shouldn't have said [ __ ] You act
00:52:32
like an adult and you go there. So, you
00:52:36
know, you know, if if you think that
00:52:39
Mark Cuban sold out, then all right, you
00:52:44
go buy people's cancer drugs, I this I
00:52:48
can't imagine Mark enjoyed this, but
00:52:50
helping people get access to life-saving
00:52:52
drugs at a reasonable value is more
00:52:55
important than him getting dragged by a
00:52:57
bunch of bots and people virtue
00:52:59
signaling and and applying purity tests
00:53:03
from their keyboard.
00:53:04
>> Right. I would agree. You just didn't
00:53:06
have the right information. The
00:53:07
inaccuracy is what I as always
00:53:09
inaccuracy desires me. And to say that
00:53:11
that he's going to make bank at this is
00:53:13
just not true. It's just absolutely not
00:53:15
true. And and you again, I I wouldn't
00:53:18
want to have to do this. I don't know if
00:53:20
I could stand next to him, but he's
00:53:23
there for the next three years. And if
00:53:24
someone needs these drugs now, and if he
00:53:28
has to take the reputational hit, that's
00:53:30
fine. I guess that's fine. The fact that
00:53:32
you're dragging him is a pro I I
00:53:36
understand the the and I don't want to
00:53:38
in this case for the first time I
00:53:40
thought derangement. Don't be so [ __ ]
00:53:42
deranged that you don't understand what
00:53:45
Mark just did which is he had to like
00:53:47
put his like ego in a in his pocket. He
00:53:50
remains by the way Mark is not I would
00:53:53
say he's liberal or conservative. He's
00:53:55
quite it can vary all over the place,
00:53:58
but there is absolutely no way Mark
00:54:01
Cuban would vote for Trump. I at this
00:54:04
moment in time or support Trump in
00:54:07
politically. So, I don't know what you
00:54:09
want from him, but to me, I thought it
00:54:11
was just a bad a bad um look for for the
00:54:14
left. I thought I really did. I just was
00:54:16
sort of disappointed. Very disappointed.
00:54:18
So, but they're going to drag us for it.
00:54:19
So, too bad. I don't care. All right,
00:54:21
Scott. Let's go on a quick break. When
00:54:22
we come back, we'll talk about Nvidia's
00:54:24
latest earnings. Support for this show
00:54:27
comes from ShipStation. As much as we
00:54:29
talk about AI, it's only as smart as how
00:54:32
you use it. And real breakthroughs
00:54:33
happen when the AI is built to tackle
00:54:35
specific problems. That's why
00:54:37
ShipStation's AI isn't a generalpurpose
00:54:39
tool. It's specialized, trained on
00:54:41
decades of real shipping data and
00:54:42
billions of actual orders. ShipStation
00:54:45
is an end-to-end order fulfillment
00:54:46
platform for e-commerce businesses.
00:54:48
Powered by AI, ShipStation is trained on
00:54:51
decades of data from billions of
00:54:52
shipments across the world. ShipStation
00:54:54
adapts to your unique business, alerting
00:54:56
you when stock is low, recommending the
00:54:58
best carrier selections and rates, and
00:55:00
automating tasks to save you time so you
00:55:02
can stay one step ahead. With features
00:55:04
like inventory syncing across your sales
00:55:06
channels, a branded returns portal that
00:55:08
helps transform returns into revenue,
00:55:10
automatic rate shopping, and
00:55:12
integrations with accounting and CRM
00:55:13
software. ShipStation eliminates the
00:55:15
need for multiple tools in your
00:55:17
workflow. The sooner you switch, the
00:55:19
sooner you start saving time and money.
00:55:21
Get started with Shipstation today and
00:55:23
get 60 days free at shipstation.com with
00:55:26
the code pivot. That's shipstation.com
00:55:28
code pivot. shipstation.com
00:55:31
code pivot. Taxes and fees apply.
00:55:38
Support for this show comes from NPR.
00:55:40
NPR understands your curiosity is
00:55:42
boundless, but your time isn't. That's
00:55:43
why they made Up First. Up First is a
00:55:45
podcast that covers the three biggest
00:55:47
news stories of the day with reporting
00:55:49
and analysis to understand them in under
00:55:51
15 minutes. Look, there's no shortage of
00:55:52
news right now, but Up First doesn't
00:55:54
just give you the headlines, it gives
00:55:56
you the context. Recent episodes covered
00:55:58
how American citizens are getting caught
00:55:59
in ISIS's growing surveillance web and
00:56:02
what the Iran war means for the US
00:56:04
economy and why Attorney General Pam
00:56:06
Bondi's exit is bigger than it looks.
00:56:08
Three stories fully reported every
00:56:09
morning in under 15 minutes. Up first
00:56:12
does something most daily news shows
00:56:14
don't. It asks better questions to get
00:56:16
better answers. Not just what happened,
00:56:17
but how it came about, why it's a big
00:56:19
deal, and what happens next. That's the
00:56:21
difference between knowing the news, and
00:56:23
understanding it. Follow NPR's Up First
00:56:25
podcast so you can understand what
00:56:27
matters and what happens next. It's hard
00:56:30
news through a human lens. And while
00:56:32
you're at it, give money to NPR. They're
00:56:34
fantastic and everything they do is
00:56:36
something I hugely admire as a
00:56:38
journalist.
00:56:40
Scott, we're back with more news. Let's
00:56:42
talk about Nvidia's latest earnings. You
00:56:44
just called them a casino. The company's
00:56:45
profit for the quarter was over 58
00:56:48
billion. They're benefiting from what's
00:56:50
happening now, which is up 211%
00:56:52
from a year earlier. That is a number.
00:56:54
It's not 30%. It's a lot. 3 years ago,
00:56:56
profit was 2 billion. Nvidia projected
00:56:59
sales in the current quarter would reach
00:57:01
91 billion and it would uh as spending
00:57:05
on AI infrastructure would reach 2 to
00:57:07
three trillion in 2030. This is an
00:57:09
insane growing streak, but like you
00:57:11
said, they're benefiting from this huge
00:57:14
spend by all these other companies. Uh
00:57:17
thoughts very quickly.
00:57:18
>> Well, not a casino. They're the house.
00:57:20
>> Okay.
00:57:21
>> All of these companies spending just a
00:57:23
crazy amount of money on 1.6 trillion on
00:57:25
capex are kind of drunk gamblers is the
00:57:28
way I would describe it. And they're
00:57:29
benefiting from it. They're the house.
00:57:30
They're the house when billionaires show
00:57:33
up, sharks with who are drunk and have
00:57:36
unlimited credit at the casino. That's
00:57:37
the way I would describe it. But just in
00:57:39
terms of the earnings, the revenue was
00:57:41
81 billion, up 85% year-on-year, which
00:57:44
was a beat. Earnings per share was a
00:57:46
beat. Data center revenue 75 billion, up
00:57:48
92% as you said, year-on-year accounting
00:57:50
for 92% of total revenue. Again, a beat.
00:57:53
Their Q2 guidance 91 billion above the
00:57:55
86 billion expectations. Another beat.
00:57:58
And their shareholder returns dividend
00:58:00
was raised 25x from 1 cent to 25 cents
00:58:03
per share. 80 billion in new buybacks
00:58:05
authorized. And I mean the reason he's
00:58:08
on that plane to China is there's no
00:58:10
shipments right now and he he's like he
00:58:12
looks at the stock price and thinks I
00:58:14
have got to continue to be
00:58:15
>> continue.
00:58:16
>> Yeah. And the only thing that's I found
00:58:18
really interesting here was despite
00:58:19
beating on every every conceivable
00:58:22
metric, the stock was flat, which says
00:58:26
to me that so the expectations of the
00:58:28
stock price are so enormous now that
00:58:32
they don't they people don't expect
00:58:34
Nvidia to beat, they expect them to
00:58:35
massively beat, which says to me that
00:58:37
the first time Nvidia even whispers
00:58:39
things might be slowing down, it it
00:58:42
craters. So unbelievable company, 15th
00:58:46
beat in a row, but I just think so the
00:58:49
expectations that are built into this
00:58:51
valuation. I think it's the most
00:58:52
valuable company in the world now.
00:58:54
>> Yeah.
00:58:55
>> Um are pretty significant as evidenced
00:58:57
by the fact that it beat on every
00:58:58
conceivable metric and the stock didn't
00:59:00
move.
00:59:01
>> Right. Right. That's interesting. That's
00:59:03
a really good point. Anyway, we'll see.
00:59:05
We'll see what happens. There's a lot.
00:59:06
It's it's precarious
00:59:09
is what I fragile.
00:59:10
>> By the way, stocks off 2% today.
00:59:11
>> Yeah. But let me see a lot. Several
00:59:12
different Wall Street people call me in.
00:59:14
They said, "Everything feels so
00:59:16
fragile." So, we'll see. All right,
00:59:18
Scott. One more uh quick break. We'll be
00:59:20
back for predictions.
00:59:22
>> Today's show is brought to you by
00:59:23
Vanguard.
00:59:25
To all the financial adviserss
00:59:26
listening, let's talk about bonds for a
00:59:28
minute. Capturing value and fixed income
00:59:30
is not easy. Bond markets are massive,
00:59:31
murky, and let's be real, lots of firms
00:59:34
throw a couple flashy funds your way and
00:59:36
call it a day. But not Vanguard.
00:59:38
Vanguard bonds are institutional
00:59:39
quality. Institutional quality is no
00:59:41
tagline. It's a commitment to your
00:59:43
clients. It means top grade products
00:59:44
across the board. The lineup includes
00:59:46
over 80 bond funds. They're actively
00:59:48
managed by a 200 person global squad of
00:59:50
sector specialists, analysts, and
00:59:52
traders. A lot of firms love to
00:59:54
highlight their star portfolio managers,
00:59:55
like it's all about that one brilliant
00:59:57
mind making the magic happen. Vanguard's
00:59:59
philosophy is a little different. They
01:00:01
believe the best active strategies
01:00:03
shouldn't be locked away with one
01:00:04
person. They should be shared across the
01:00:06
team. So, if you're looking to give your
01:00:08
clients consistent results year in and
01:00:10
year out, go see the record for yourself
01:00:11
at vanguard.com/audio.
01:00:14
That's vanguard.com/audio.
01:00:16
All investing is subject to risk.
01:00:18
Vanguard Marketing Corporation
01:00:20
distributor.
01:00:22
Support for this show comes from Navon.
01:00:25
Business trips are great. The baggage
01:00:27
that comes with them is not. The shuffle
01:00:29
of paper receipts, the dreaded post-trip
01:00:31
paperwork. Non deletes all the grunt
01:00:33
work so employees can actually focus on
01:00:35
the business part of business trips.
01:00:37
More than 12,500 companies including
01:00:39
Box, Anthropic, and Kraton Barrel refuse
01:00:42
to work the old way. They choose Non to
01:00:44
make the annual expense report extinct.
01:00:47
So if you want to save 15% on your TN
01:00:49
budget, yes, 15%, check out non.com.
01:00:56
Okay, Scott, bring your predictions in a
01:00:57
second. I just want to note we're going
01:00:58
to be off on Memorial Day uh for
01:01:00
Tuesday. would not be we'll be taping a
01:01:02
show on Memorial Day for Tuesday.
01:01:04
>> All right. Oh, I'm sorry. Um, so I have
01:01:07
one
01:01:09
we talked about late state or 99, but I
01:01:12
I'm I'm going to I just can't help it. I
01:01:15
don't think SpaceX is going to price
01:01:17
near $2 trillion.
01:01:19
>> Okay.
01:01:19
>> The financial suggest
01:01:20
>> I think you're going for it.
01:01:22
>> Well, you're going to have so many
01:01:24
people pouring over this S1 and it's
01:01:28
just pretty ugly. You just read this
01:01:30
thing and you start thinking, okay, this
01:01:33
feels
01:01:34
this feels a little bit, you know,
01:01:37
Iawasa. It just it it's a lot. And if
01:01:41
and if you take each of the three
01:01:42
business lines, space, connectivity and
01:01:44
AI, and apply a comparable price to
01:01:47
sales multiple to each, Rocket Lab for
01:01:49
space, VSAT for connectivity, and
01:01:52
anthropic for AI, which are very
01:01:54
generous, you know, health healthy
01:01:57
valuations and you add them up, you end
01:01:59
up with a valuation of 547 billion. My
01:02:03
my hero on this stuff, Asat Motorin,
01:02:06
valued the thing at 1.1 trillion. And if
01:02:08
you double each of those price to sales
01:02:10
multiples,
01:02:12
um, you assume that each business will
01:02:13
command a valuation that is two times
01:02:15
the typical market rate, you are still
01:02:17
about $750 billion away from SpaceX's
01:02:20
projected valuation.
01:02:21
>> Yeah.
01:02:22
>> So
01:02:22
>> that's being kind. You're saying that's
01:02:24
being
01:02:25
>> if you just get very aggressive and
01:02:26
value every piece of this as a leader in
01:02:28
its respective field
01:02:29
>> and add the Elon plus,
01:02:31
>> you add you get 600 billion and then you
01:02:33
go, okay, Elon effect, double it, 1.2
01:02:36
trillion. So, I've I've always been
01:02:38
wrong around Elon, but I'm saying I
01:02:40
think it's going to I think two China is
01:02:41
a real stretch for here and it's going
01:02:42
to price below that.
01:02:43
>> All right.
01:02:44
>> And then the other one is just boring
01:02:45
one. There's I think you can expect a
01:02:47
deal between the US and Cuba in the
01:02:49
coming months.
01:02:50
>> Cuba is currently in a fullblown crisis.
01:02:53
I absolutely think the smartest thing we
01:02:55
could do is be providing humanitarian
01:02:56
aid and let people decide that they want
01:02:58
to be the 51st state or at least get
01:03:00
along with us.
01:03:01
>> Yeah, I agree.
01:03:01
>> The collapse is comparable. Well, it's
01:03:03
not getting any news because of
01:03:04
everything else going on. But the
01:03:05
collapse is literally comparable to the
01:03:06
1990s crash that followed the fall of
01:03:08
the Soviet Union.
01:03:09
>> Yep.
01:03:09
>> Between December of 2025 and April of uh
01:03:12
26, Cube received just one of the eight
01:03:14
monthly fuel shipments its economies
01:03:16
required requires to function.
01:03:18
>> And blackouts are now, get this, 20
01:03:21
hours a day.
01:03:22
>> I mean, it's crazy. No, we should just
01:03:24
help them
01:03:25
>> 100%.
01:03:26
>> part of the world again. And uh and but
01:03:29
there's going to be a deal here because
01:03:31
Rubio is reportedly having secret talks
01:03:34
with Ral Castro's grandson, bypassing
01:03:36
official Cuban channels. Trump told
01:03:39
reporters in February, Cuba wants to
01:03:40
make a deal. Just yesterday, Rubio sent
01:03:43
video message to the Cuban people,
01:03:44
proposing 100 million in aid, and
01:03:45
blaming Cuba's leaders for shortages of
01:03:47
electricity, food, and fuel. Uh Rubio
01:03:50
was born to two Cuban immigrants, and
01:03:51
this is a deal that he has personal
01:03:53
investment in. He sees this as his run,
01:03:55
his next
01:03:55
>> his
01:03:57
president.
01:03:58
>> All the people
01:03:59
>> sets him up well for a 2028 run. Cuba is
01:04:02
in a deep dark corner. And also Trump,
01:04:05
he doesn't want another military
01:04:06
excursion. There's just there's no
01:04:08
[ __ ] way.
01:04:08
>> There's a way to do this. Just let it
01:04:10
fall apart and we come in and help pick
01:04:11
up the pieces.
01:04:12
>> It's already Well, it's falling apart,
01:04:13
>> right? You know what I mean? It's like,
01:04:15
you know, interestingly, I agree with
01:04:17
you here because I do think it should be
01:04:18
welcomed back into the nations. It's
01:04:21
I've always wanted to go there. You
01:04:22
know, my my actually everyone in my
01:04:25
family has been there but me, which is
01:04:26
interesting.
01:04:26
>> I've been there. It's great.
01:04:27
>> Yeah. That's I just feel like it's it's
01:04:30
a wonderful people and it'll help Rubio
01:04:32
immeasurably. This is at the heart of
01:04:34
his presidential camp. You understand
01:04:35
that? Like it's very clear for at least
01:04:37
for Florida. Um and uh and one of the
01:04:40
things that speaking of collapse, I've
01:04:42
heard from so many foreign affairs
01:04:45
people who I really trust and think are
01:04:48
smart that Russia is very in much
01:04:52
distress. Putin is under much stress
01:04:54
right now because of the situation in
01:04:57
that that in Ukraine, the economy,
01:04:59
everything else. And that they had
01:05:02
thought this is the first time they see
01:05:03
a light at the end of the tunnel,
01:05:04
Putin's rule. Just saying that. Just
01:05:07
putting that out there which was
01:05:08
interesting and
01:05:09
>> I gonna say it as a lie at the end of I
01:05:10
think the end is nigh.
01:05:12
>> The end is nigh. Yes. Whatever. Anyway,
01:05:14
so it's just interesting and we should
01:05:15
do this you know there let me let me
01:05:18
quote that more on Brendan Carr. We can
01:05:20
do this the easy the hard way or the
01:05:22
easy way. Let's do it the easy way with
01:05:23
the Cubans, right? Let's show them the
01:05:26
bigness of the United States and really
01:05:28
help them. And then Scott and I will
01:05:30
open our hotel there and retire.
01:05:33
Okay. Uh okay.
01:05:35
>> Great mojito. Great,
01:05:36
>> great cigars, everything else. Uh, in
01:05:38
any case, we want to hear from you. Send
01:05:40
us your questions about business tech or
01:05:41
whatever's on your mind. Go to
01:05:42
nymag.com/pivot
01:05:44
to submit a question for the show or
01:05:46
call 85551 pivot. Okay, that's the show.
01:05:50
Thanks for listening to Pivot. Be sure
01:05:51
to like and subscribe to our YouTube
01:05:53
channel. We, as I said, will be back
01:05:55
next week.
