00:00:00
Linda, come on. We'll have fun. You can yell at me, Linda. You can scream at me. You can call me the c-word. I don't
00:00:07
care.
00:00:12
Hi everyone, this is Pivot from New York Magazine and the Vox Media Podcast Network. I'm Carara Swisser and I'm Scott Galloway.
00:00:18
We've got a lot to get to today, including Trump's latest tariff chaos and a major shakeup at Apple. But first,
00:00:24
Scott, it's the day we knew was coming for quite some time. I'm Linda Yakarino is stepping down as CEO of X after two
00:00:30
years in the job. Yakarino announced her departure in a post on X thanking Elon uh calling the job an opportunity of a
00:00:36
lifetime and he responded cold. Thank you for your contributions. Yeah. Yeah. Clearly they're very warm.
00:00:43
They're they clearly are very close. Yeah. It was like love all around. Um
00:00:49
uh let me just say that was gold. like if when we break up can you write me thank you for your contributions just
00:00:55
because I just yeah thank you for your contribution anyway she did not provide a reason for her
00:01:01
departure although we have speculated over especially when X and AI merged um
00:01:06
the decision was reportedly months in the making of course it was she was effectively demoted back in March thanks to X's merge with XAI and you and I
00:01:13
talked about this that she was layered essentially and that she wasn't CE she was a CEO name only to start with now
00:01:19
she really was layered and she probably was getting layered Further um current and former employees uh told the Wall
00:01:24
Street Journal Yakarine's position was tenuous after clashes with management. He brought in uh someone from TubeB
00:01:30
which is interesting to be the CFO and he he of XAI I think and again layering
00:01:36
layering layering and this is a woman who really wanted to be CEO. Uh of course she picked the wrong person to do
00:01:41
that with her exit comes amid major problems with XAI's chatbot Grock. This week, the bot was spewing anti-semitic
00:01:47
rhetoric, recommending a second holocaust and calling itself Mecca Hitler. I don't know where that came
00:01:53
from. I guess mechanized Hitler. I don't know. Um, so she's really leaving on a high note. By the way, threads is about
00:01:58
to catch up with uh with with X also. And what else? I probably she didn't want to get in the middle of the beef
00:02:04
between she can't use lawsuits and threats of Trump retribution anymore since Elon's not friends with him
00:02:11
anymore. Um, I can't wait to hear what you think, but let's first listen back to what we had to say about Linda last
00:02:16
July. Like, Linda, what are you doing? You're not running a company. You're running a like he's just using it for a political
00:02:22
cudgel. That's it. That's it. That's all that's She's She's the circus clown following
00:02:28
around an elephant scooping up his [ __ ] She's constantly She's basically the most overpaid apologist in history other
00:02:34
than someone being in the Trump cabinet. I don't know what she's doing there. It's just I I don't really care cuz I don't really care for her. But it's it's
00:02:41
embarrassing. It's an embarrassing way to spend your life. If you want if you're a real ad person, which you used to be, get a job at a real company. So,
00:02:49
she's taken our advice, I guess. But, um, in any case, what do you think about what's happening here? And obviously,
00:02:55
the ad market is going to fall off drastically for this company because of the safety issues. For one, Nazis. It's
00:03:00
now just not Nazi adjacent. It's full Nazi. Um, and also, uh, the numbers are declining and now advertisers probably
00:03:07
don't feel the pressure anymore. Um, I I doubt he'll bring in someone to replace her. I guess I don't think he really
00:03:13
cares for the business. And, um, talk about her ultimate legacy. I think it's probably the same as you said. Correct.
00:03:20
Look, it reflects Linda moving on reflects the kindest thing you could say. It reflects a shift in strategy as
00:03:26
opposed to a failed strategy. You know, Elon Musk, people don't remember, he offered $44 billion under what I assume
00:03:32
was a ketamine induced mania and then did everything he could to try and back out of the deal. Basically sued the
00:03:39
company, went all the way to the Delaware Chancery Court saying, "I don't have to close on this deal." When he realized he was vastly overpaying for a
00:03:46
subscale social media company and the judge said, "Fuck you. You got to close, boss. This still is a nation of laws."
00:03:52
And the strategy was, you know, there were several pillars to the strategy. One was to dramatically cut costs. His
00:04:00
Mus vision was I could have a minimum viable product or a similar product with dramatically less costs. And to his
00:04:08
credit, he shocked everyone and was right. He laid off 80% of the people.
00:04:13
And the bottom line is I'm not sure you would know the product was much different three or six months later. Except for the safety issues and the
00:04:20
sort of the crap, but that but that was a that was a strategic decision, not not cost cutting. The reality is, so let's talk a
00:04:27
little bit about that. Hate speech increased 50%. Transphobic slurs increased 260%. Homophobic tweets rose
00:04:34
by 30%, racist tweets 42%. And engagement grew 70% for posts around
00:04:40
hate speech. Meaning this wasn't a this wasn't a function of a lack of moderation or cost cutting. It was a
00:04:45
function of the fact that Elon Musk in my view is is racist and anti-semitic.
00:04:52
And let me be clear, everyone dances around rich people. I am calling Elon Musk anti-Semitic.
00:04:59
When you're accidentally making waves that look like Nazi gestures, when you
00:05:04
have decided that something our nation needs to be focused on is the white genocide in South Africa and when there
00:05:12
tends to be a prepoundonderance of swastikas appearing on your social media
00:05:17
platform. This creates a pattern. These aren't mistakes. So this quote unquote free speech
00:05:24
strategy which was part of his strategy was not free speech. He was happy to regulate certain people. It was a belief
00:05:31
that I don't know quite frankly the the guy in my view is got something deeply
00:05:37
wrong with him and is very comfortable with normalizing hate speech. That is
00:05:44
that is racism. And we keep because he's so rich and he can land a rocket in
00:05:49
scissors. dance around it and say, "Oh, he has Tourette's." He's very disciplined about not saying outlandish,
00:05:56
provocative things about the Chinese. He's very disciplined about not saying
00:06:01
things about, you know, until recently, uh, what were very aggressive actions on the Trump administration. So, this
00:06:09
strategy of free speech was nothing but a false flag. He also uh recognized I
00:06:15
think and and the strategy he he said okay this is an advertising platform so I'm going to bring in who is one of the
00:06:21
most respected people in the ad world and Linda was that yeah tough a tough customer but really
00:06:26
well respected well she was at NBC for people who didn't know she people hugely respected her and what
00:06:31
this represents is one the strategy isn't working the the entity that is that has benefited most
00:06:36
from the acquisition of Twitter by Elon Musk is in fact Meta Meta is about to
00:06:41
blow ASP Twitter because they Twitter basically created an opening uh for a
00:06:48
platform that was quite frankly had more adult management and also uh Mark Zuckerberg, one of the most brilliant
00:06:54
business minds of the last generation saw that if he turned his fire hose of three billion users on a micro blogging
00:07:00
platform called Threads, he could take advantage of the fact that people were looking for something. Both of us are
00:07:06
off of X. Yeah. And and actually threads is a pretty good experience. I am on both Blue Sky and Threads. I like threads for
00:07:12
certain things. I like blue sky for certain things. But it it's the opening is what you're talking about is that he
00:07:18
I would have stayed on Twitter had this not happened. Correct. You would have too, correct? Yeah. You had a couple million users. I
00:07:24
had half a million. We were generating a lot of Nissan ads and we both and we both liked the product and we both we
00:07:31
both eventually just got off of it. And I think a lot of people feel that way. But what this represents
00:07:39
something more meta and you you you forwarded a really good article on this. Yeah.
00:07:44
This represents a shift and we should find find the I've got it right here actually. I have it right here. It's um hold on let me
00:07:51
Henry Inis uh okay he he put this piece let me just read one thing that I was going to read
00:07:57
to you actually which I think was ex you know it's a great piece. It's very long. You should read it. And he goes X under the stewardship of
00:08:03
Musk appears to have chosen a second path. This isn't a retreat. It's a strategic repositioning. It's a wager
00:08:08
that the future of social media, some social platforms, lies not in renting out user attention to the highest
00:08:13
bidder, but in selling intelligence, utility, and commerce directly to the user. This is a story of why the long
00:08:19
assumed marriage between social connection and advertising revenue may be headed for a messy necessary divorce.
00:08:25
And another thing you said which I think is also um the monolithic concept of social media splitting into two distinct
00:08:30
business models driven by a simple brutal economic calculation. The cost of guaranteeing brand safety in the age of
00:08:36
AI is becoming prohibitively expensive. This is forcing platforms to have a choice. Either become a fortified walled
00:08:42
garden for advertisers or find a new way to exist entirely. I thought that was well said.
00:08:48
He really that's an outstanding article and it convinced me that you asked what her legacy is. This is essentially
00:08:56
signals a pretty dramatic shift. And Elon Musk for his faults on a business side. I I I
00:09:02
also I think people just have to acknowledge I he's a brilliant businessman and he
00:09:08
has decided okay this isn't working. I'm going to use Twitter as a body bag or as
00:09:14
nutrition for an LLM that all the activity and all the information it produces will be fed into an LLM which
00:09:21
will offer vertical I believe services such as your travel or dating or
00:09:27
figuring out subscription services. He's gonna try and go AI and offer, you know, uh,
00:09:34
customized, individualized, premium content that you pay for and all kinds of things
00:09:40
because the number four, the number five social media platform that doesn't have the scale to pay for the tech stack or
00:09:46
the brand moderation and safety, which is getting increasingly costly both economically and non-economically, it's
00:09:52
just not working. Yeah. And one of Can I ask you something? One of the things that she had talked about is like we made it into
00:09:58
an everything app. He didn't actually. It is not an everything app. The second thing is he signaled this early on with
00:10:05
adver. The first thing he did was get into a beef with advertisers when yo Roth was still there and they had to have a meeting where he was nice to
00:10:11
advertisers. And then later in that famous New York Times uh interview with our favorite Canadian Andrew Ross
00:10:17
Sorcin, he said to advertisers, "Go [ __ ] yourselves." Remember that? And it was clearly something was on something and
00:10:24
then insulted Bob Iger right there who's sitting in the audience if you remember that go [ __ ] yourself to advertisers and
00:10:31
and then they they they conducted you know a legal war on advertisers so he never was going to be an advert he
00:10:38
didn't want it to be he had no interest from the get from the first first beginning of this company before Linda
00:10:45
but Linda Linda's a trivia question she's sort of unimportant in this she was nothing but a figurehead who was
00:10:50
there to be a professional apologist and hopefully renew some relationships on advertising.
00:10:56
The the the two big things here from a from an industry impact is that the
00:11:02
reason that Meta had what is probably the most seinal earnings quarter in history where they announced that their
00:11:08
revenues are up 23% while costs were down or employee uh employment was down
00:11:14
20% leading to a explosion in earnings of 72%. is because I do think the entire
00:11:20
corporate world in tech looked at what Elon Musk had done. Yeah. And said he laid off 80% of his staff
00:11:28
and maintained a minimum viable product. And I think everyone started thinking maybe we don't
00:11:34
maybe we don't have to grow our employee base while maintaining revenue growth. I
00:11:39
think that was the biggest impact that X has had on the ecosystem in the last two to three years. And then quite
00:11:45
frankly, the guy does the guy can see around corners and this does potentially
00:11:51
represent a shift from an ad-based uh scale model of social media to trying
00:11:58
to use social media the data it produces the tokens to come
00:12:03
up with more AIdriven offerings. I think those are the two kind of well let me push push back on that. He
00:12:08
it's also you know Grock and he talked about that that it's a long way from being a commercial product. That's one thing he did say, but he also had a take
00:12:15
on the anti-Semitic thing where it was Mecca Hitler and it was really and also tal had a very descriptive and very
00:12:22
detailed way to rape someone. Um, Grock was too compliant to user prompts, too eager to please to be manipulated
00:12:28
essentially. He just rolled out Grock 4, the latest iteration. The first I guess the first ones were too woke. This one
00:12:35
was too Hitler. And I we I haven't used Grock. I don't use Grock that much. It's it's certainly interlaced in everything
00:12:41
in Twitter. if you go over there. I was there. I was like, it's every Grock is everywhere. So, that should tell you
00:12:46
everything. Um, that has nothing to do with discussions, right? It's always there asking you if you want help with
00:12:52
something. So, what how do you push back? How do you do this if you're making a you just said a minimally
00:12:58
viable product is not really what makes money, right? You have to have a product that people like. They don't feel that
00:13:04
they're going to be assaulted all the time or or or or in an unsafe environment for for people. So what what
00:13:12
does he do with this kind of thing thing or he just walks right through it like ah he was Hitler yesterday now he's not
00:13:18
Hitler I guess. Yeah but you said this early on Twitter was always the subscale platform that
00:13:23
could never kind of command the space it wanted to occupy it advertising it had an amazing product that could
00:13:29
just never figure out a business model that scaled like the rest and he was unable to figure that out. But I'll go back to
00:13:35
my original insult of of Mr. Musk and that is of all the social media platforms of all
00:13:42
the individuals who are you know icons of technology if I asked you Cara
00:13:48
there's a product that is calling for a second holocaust
00:13:54
who would you assoc who would you say is most likely the person in charge of that product.
00:13:59
And then you have to say it is Mark Zuckerberg. Yeah. Go ahead. And then you have to say, well, is that of a function of his embrace of free speech or is it a
00:14:08
tolerance and a normalization of the type of hate speech that can take us to very dark places?
00:14:13
Number two, and I'm kind of like we just make all of the
00:14:19
and where do we go? I don't want an individual in the business community who
00:14:25
does not want to put in the safeguards such that a quarter of a billion people such that we start normalizing the idea
00:14:32
of a second holocaust. I have no desire to pay taxes that subsidize his products
00:14:38
if he can't figure out a way to not have his products recommend a second holocaust. I don't think that's a very
00:14:45
high bar for someone. But this is typical of him. This is typical, you know, away from what typical a scary word. It's
00:14:51
normaliz when he did the cars, he's always in the minimum viable safety of every everything he does is minimum
00:14:57
viable safety, right? And so if the rocket blows up, what of it? If the car does more than that,
00:15:03
but it's the same pattern. It's the same idea, I think, that he does things. And so in this case, it's just it it's
00:15:11
speech, but it's it's it's moved. It had to get to Hitler, right? And you know, he's always pushing back on this Hitler
00:15:18
thing and then he just shows up with Hitler, right? It's it's I here's my here's my wave that looks like
00:15:24
a Nazi salute. And if you heard of the white genocide in South Africa, his most valuable company, I think, is going to
00:15:29
be SpaceX. And his willingness to take enormous risks. The the core competence of SpaceX is explosions. And that is
00:15:37
NASA can't send up rockets that explode 15 minutes or 15 seconds. Musk can and
00:15:43
say this is part of innovation is we have to hit the outer ring of innovation and risk to make huge progress that is
00:15:50
to a certain extent there's a there's a real genius in that and the reason and SpaceX is going to be worth more than
00:15:56
Tesla. So, well, maybe now that Well, we'll get to the, you know, the head of NASA is going to be one of his enemies,
00:16:02
Sean Duffy, who's totally incompetent, by the way. They Trump just named the transportation secretary who's
00:16:08
incompetent, the interim head of it. But listen, just just just to put a bow on it, Linda's a trivia question. She'll go back to
00:16:15
selling ads for I hope when she first signed up for this, when she signed up for this, we said the following. I said,
00:16:21
I hope she has I hope her lawyer spent a dramatic amount of time talking about
00:16:27
termination or termination, what for cause meant, what happened when she's terminated, cuz she was fired here. You
00:16:34
can call it constructive termination when you're just consistently layered. That's constructive termination.
00:16:40
CEOs will put in clauses that say if my reporting relationship differs and you put me in the corner and chain me to a
00:16:47
desk and tell me I'm now in charge of snacks and not the CEO, that is constructive termination cuz we said
00:16:52
there's just no way she we said there's no way she's going to survive here. People don't survive around this guy.
00:16:57
Yeah, she'll go back to like a Paramount makes sense. She's close with Jeff Shell who's going to be now and she's a global brand now. Everybody
00:17:04
knows who she is. She has huge relationship making up to do. She's still there. If you talk to ad people,
00:17:09
they they really at con they were like they I I was surprised by the level of
00:17:15
vitriol towards her. I was like ah whatever she's you know I was nicer than they were. Um but of course they're
00:17:20
advertising people so she has a big job though as she joins Paramount Plus and
00:17:25
everybody a party at can that that has Kigo and all is forgiven. I mean that's the bottom line.
00:17:32
Go ahead. Go ahead and finish. But but X under his ownership did ignite
00:17:38
a dramatic shift in the entire technology ecosystem. Yeah. Where people woke up and said, "Wow, can
00:17:45
we have the great taste of fewer employees, right, without the calories
00:17:51
of reduced growth?" He he questioned he showed up to Twitter and said I think I
00:17:57
can do what you're doing almost as well on 1ifth of the calories on 1/5if of the
00:18:03
people and two this shift is a shift Zuckerberg and everyone I believe now is
00:18:10
saying okay the age of social media the age of social media getting 98% of
00:18:16
its revenues as snap uh x and meta do right now is shifting. It's going to
00:18:23
move towards sort of a little bit the model to a certain extent is the YouTube model and that is they still have scale.
00:18:29
They still get a lot of money for advertising but they also get a lot of money and the fastest growing part of their business is the subscription side
00:18:36
where they say we can serve you up just a really great product using AI and using data that you start to pay for. By
00:18:42
the way, have you noticed how many ads are on YouTube now? They really are. But let me say they have to here's what they have to do
00:18:48
there. They've got to make a great product. So it'll be interest. They have to make a great product. That's the issue and we'll see if he can in media.
00:18:54
I think he's very talented in other things. Media is not one of them. Uh speaking of which, just two things. At at SpaceX, um they're planning to make
00:19:01
raise money and sell insider shares in a deal that would valued around 400 billion already. This would mark the highest ever valuation for a privately
00:19:07
held US company, surpassing SpaceX own record of $350 billion set last year.
00:19:13
Presumably there's going to be an IPO, but I got to tell you, there's going to be some rough uh going there, especially with his relationships as long as
00:19:19
Trump's in office and Sean Duffy's in charge of NASA and areas where and also he doesn't get to out of the Oval Office
00:19:26
get to to to shake down countries into taking uh Starlink even if it's the best product. He was that was happening
00:19:32
there. So Tesla on the other hand is really problematic for him. Shares dropping nearly 7% after Elon announced
00:19:39
this new America party. It's not rebounding. Um he's also focused on uh
00:19:44
the Epstein the the focus is out once again. He this board of directors which we know is not really a board.
00:19:50
Did you see this tweet about Bannon? Yes, Bannon. Yes, he's pointing the finger of Bannon the Epstein. I'm waiting for him to say Scott Galloway's
00:19:56
in the Epstein files. Um te Tesla stocks down 14%. It's down 40% from their
00:20:01
December pee. He got into a fight with Dan Ies who I think is who has been a longtime Tesla bull far too long. Says
00:20:07
the company is at a tipping point. Yeah, he has a price target on he has a price target on Tesla, 500 bucks.
00:20:13
I know, but he's urging the board to set boundaries for Elon and both time at Tesla and his political activities. Elon
00:20:19
responded to those suggestions on X saying, "Shut up, Dan." He's so nice to his fans. It's not just political
00:20:26
activities. Vehicle deliveries. Obviously, Bannon is in the Epstein files was the tweet he put out to a quarter of a
00:20:31
billion people. I know, but but let's just go product by product. He's going to jail. He said he's also going back to prison, but go ahead.
00:20:36
Yeah, XX X is definitely they've given away the micro blogging business to to Mark Mark Zuckerberg. So that means the
00:20:42
product is severely diminished. The Tesla product is at best sideways. A lot
00:20:48
of people would say it needs you use the word fresh or freshening. I still think
00:20:53
it's a great car. He he absolutely ignited the EV race. He deserves a lot of credit for that. SpaceX on the plane
00:21:02
yesterday I took from from Spain. The Starling product
00:21:07
is incredible. Superb. Superb. I know. In I did a podcast for my plane um
00:21:14
yesterday and quite frankly it was near the do that. Can we fly around and do Okay. Okay.
00:21:20
It is I it is what he has pulled off with Starlink is nothing short
00:21:26
of remarkable product as opposed to X is not a great product.
00:21:32
Oh yeah. No, X is X X has fallen off a cliff in terms of if media is about
00:21:37
Tesla in a lot of ways. Not new no new products and what we get is the cyber drug. So it's it's a mixed bag. Scott,
00:21:43
what's happened with Tesla is quite frankly he made a mistake. Everyone wants the great taste of lower manufacturing costs in China. Apple did
00:21:51
it and gave rise to gave rise to Xiaomé and a bunch of other tech companies. Tesla quite frankly probably had a lot
00:21:57
of its uh IP stolen that ended up at BYD. BYD has innovated on it and quite
00:22:03
frankly BYD is now offering a Tesla product that is equivalent maybe even
00:22:08
better for half the price. We have given away anyways and then these ridiculous
00:22:15
tariffs and all this [ __ ] Essentially China has essentially usurped global
00:22:20
leadership in the automobile industry because of poor public policy internally
00:22:26
and two I do think they have taken a lot of IP from Tesla and have scaled it. Yeah. Yeah. He let it happen, right? He
00:22:33
let it happen. It doesn't He could He could have done something to prevent that. In any case, Tesla's in a much
00:22:38
more precarious place. I think we both agree. And they and making he's got to get back interested in it. He doesn't
00:22:44
seem interested in it. Um and when he seems interested in it doesn't sell to consumer saying that Bannon is in the Epstein
00:22:49
files. Yeah. And Bannon I mean literally literally Cara, it's as if he's on drugs.
00:22:55
Anyway, it's on drugs. Linda, we wish you well. Give us a call. Give actually do we want her to call us?
00:23:01
Yes, we do. Yes, give us a call. You should interview Linda. I You think I haven't already contacted?
00:23:07
What are you talking about? She won't do it. She Linda, come on. Come on. We'll have fun. You can yell at Linda. Come on
00:23:13
in. The water's fine. Linda. Linda. We will have fun. You can yell at me all you want. You can scream at me. You can
00:23:20
call me the c-word. I don't care. Just come on. We'll talk about it. Um, by the
00:23:25
way, all those celebrity deals she did, you remember? And she was announcing How long was he?
00:23:30
5 minutes. I like 72 when he asked. And there's others. They announced the Serena Williams thing at con. Do you
00:23:36
remember? They just two weeks ago she was announcing that. I'm sorry, Serena. Looks like you're [ __ ] out of luck.
00:23:41
If you're going to call Canon, I'm going to say Serena Williams in France underpants. Okay,
00:23:47
that's right. They did a deal with Serena Williams, didn't they? Yes. I mean, seriously, it's like, you know. Anyway, uh let's go on a quick
00:23:54
break. When we come back, tariffs galore. You're going to get to tariffs. Support for this show comes from into it
00:24:01
quickbooks. Are you a business owner looking to grow your business? You did what most dream of doing, starting your
00:24:07
own business. Now you're faced with the reality of how to make your small business run smoothly into it.
00:24:13
QuickBooks can help. QuickBooks is a powerful AIdriven all-in-one business solution. That means those day-to-day
00:24:19
tasks, invoicing, expenses, taxes, can be done effortlessly. But here's where it gets really good. You don't need to
00:24:25
hire a team of analysts to find growth opportunities hiding in your business data. QuickBooks can help with cash flow
00:24:30
optimization, profit and loss analysis, and it helps you see how your business is doing and uncover new ways to be more
00:24:36
profitable. QuickBooks can help you unlock the growth in your business so you can get back to enjoying your
00:24:41
business. Manage and grow your business all in one place into it. QuickBooks, your way to money. Get 90% off for 3
00:24:49
months. Limited time only. Terms and conditions apply.
00:24:56
Scott, we're back for a quick rundown of latest news on terrorists, which is exhausting in in He was supposed to do
00:25:01
90 deals in in 90 days. 90 days. 90 deals in 90 days. Since we spoke, President Trump has
00:25:07
though sent a letter to over 20 countries, including mostly countries that aren't really high on our our list
00:25:13
and in some cases we have surpluses with. He announced terrorist rates between 20 and 40%. I think like the
00:25:19
Maldes or something like there's countries he's Muldava I think was in there but anyway Muldova Muldova those
00:25:24
rates must be adjusted that's where Khan is shut those rates can be adjusted according to
00:25:32
can fine I'll give in if you'll shut the [ __ ] up the rates may be adjusted according to each country's relationship
00:25:38
uh with the US threatened 50% terrorism against Brazil suggesting the decision was partly in response not partly in
00:25:44
response to the prosecution of former president Bolsaniro for his alleged role in the plot to overturn the 2022
00:25:50
election there. He feels like maybe he's help trying to help a friend uh a similar friend. He announced a new 50%
00:25:57
tariff on all imported copper and threatened to impose up to 200% tariffs on imported pharmaceutical products.
00:26:03
Markets have stayed relaxed at the news. They're just ignoring him partly in part because pres President Trump labeled his
00:26:09
August 1st deadline as a firm but not 100% firm. taco taco. Trump always
00:26:15
chickens out is actually maybe working in his favor. Um he gets to continue with this nonsense. Um and not worrying
00:26:21
about the markets. Nobody believes he's going to do anything because he doesn't do anything. And the Brazil one is just beyond and they just sit and wait them
00:26:28
out. They're not they're not rushing to make deals obviously. Um the Brazil thing we're we are in a trade surplus
00:26:34
with Brazil. It's so ridiculous. And at the same time, you know, in our own labor markets, they're telling Medicaid
00:26:42
recipients to go work on a farm. I guess I don't I don't I don't even that poor I
00:26:48
I feel bad. You have several policy. We know pick crops, pick almonds. Like the whole thing is insane that just
00:26:54
the thing way they're talking about it like oh we're going to replace them with medic like I I the fact that they merged
00:27:00
Medicaid and farm workers. I just don't even understand what they must sit there in a room and go, "Yeah, yeah, let's get
00:27:05
the Medicaid workers." Anyway, tariffs, go for it, Scott. We are living in such a simulation of
00:27:11
idiocracy that it just wouldn't shock me if I see a headline that Linda Yakarino is the new Secretary of Commerce. I
00:27:18
mean, you you you use the correct term with Brazil. We
00:27:24
have a trade surplus Brazil. Meaning explain what that means for the people. Thank you, Scott. meaning meaning first
00:27:30
off they buy more of our [ __ ] right than we buy of theirs. So, if they do what
00:27:37
they're going to do, and that that is they'll say, "Okay, 50% tariff on on
00:27:42
Nvidia chips and on uh uh F-150s,
00:27:48
then we're going to reciprocate or I'm sorry, if you want to charge us for whatever our Ember Airplanes or our
00:27:53
bananas or whatever Brazil imports in, other than like, can you tax supermodels?" Jesus Christ. Have you
00:27:59
been to the south of Brazil, Cara? I go surfing every year in Floripa and it's not for the waves. It's
00:28:05
not for the waves. Um, the Argentinians, the Brazilians are handsome people. It's a handsome
00:28:11
Oh my god. Scorching hot. The dudes, the women. Hello. That's an export we should pay for.
00:28:17
You know, it's like the world center for like plastic surgery. Anyway, anyway, so they will reciprocate. They
00:28:24
will have reciprocal tariffs, which means we'll be more [ __ ] than them. And this is what this guy can't
00:28:30
get his head around in terms of basic math. Let's talk about and I'll weave in another story here. Nvidia became the
00:28:36
most val the first company in history to hit a $4 trillion market cap. Let's take Mercedes. I think Mercedes is an
00:28:42
incredible company with incredible products. Uh amazing brand, amazing manufacturing, amazing value
00:28:49
proposition, marketing products. You sell a $100,000 Mercedes and bring
00:28:55
it into the US. They have an operating margin of about 9%. So, they get about
00:29:01
$9,000 to the bottom line. Nvidia, Mercedes buys trying to figure out a way
00:29:06
to have AI or autonomous driving, whatever. They buy $100,000 in Nvidia chips. Nvidia has approximately what do
00:29:15
they have? They have 60% operating margin. So, they get they get 60,000 to the
00:29:21
bottom line when Germany buys $100,000 of American technology products. Mh. uh or Nvidia does, they get let's
00:29:29
call it 10,000. Nvidia trades at a PE of like 33. So that 50 that $60,000
00:29:36
ends up being approximately $1.9 million in shareholder value.
00:29:41
Mercedes when we buy $100,000 of their product gets at a PE of say 8 gets about
00:29:48
$80,000 in shareholder value. And that in a nutshell explains what has happened
00:29:54
to America embracing global trade. We not only trade more, we get we get much
00:30:01
greater shareholder value because the products we tend to export and other countries purchase margins
00:30:06
are much higher margin that then have this chaser effect of a higher multiple making Americans making employees,
00:30:14
investors, housing prices, new hires out of school dramat. a chaser effect.
00:30:21
Global trade is like champagne, then we speedball it with cocaine for a
00:30:28
fantastic high in America. And this guy wants to go every reduction in trade
00:30:38
hurts us more. Every increase in trade from free trade agreements benefits us
00:30:44
more than the other party. Well, one of the things there are trade imbalances and tricks and everything else that should be reformed. That is
00:30:49
one thing which I think correctly like there are all kinds of of of things that
00:30:54
need to to happen in terms of giving advantage specifically with China but all countries do that they play the
00:31:00
games that they do and the US uh should address that but the way he is doing this and especially focusing on Bol that
00:31:06
did you read that letter it was insane on Bolson stop the trial in Brazil I was
00:31:12
like it's Brazil it's their business and that guy tried to take over the government illegally with a military I
00:31:18
mean and that he wasn't successful and the fact that well of course Trump would know a thing or two about that. Um
00:31:23
Brazil has a stronger democracy than us right now right? I know it's just crazy that he would demand another Can you imagine you
00:31:29
must stop the trial of I don't know Diddy Combmes or we're not going to do a deal. It's just like nuts. Um, the other
00:31:36
thing is what's fascinating to me is how someone who I what I look Howard letton
00:31:42
is as dumb as a box of hammers. But um, but but Bant seems very smart, but now
00:31:48
because I think he wants to be the head of the Fed, he's been sucking up to him and pretending pretending this is real
00:31:54
and not play. You know, it's really interesting. I I I I'd love to actually understand the dynamics when they're not
00:32:02
talking to him, when they're talking amongst themselves because like the whole Ukraine thing is another example where they PG says apparently stopped
00:32:09
the things and then Trump restarted them or somehow got alerted to it. And to his credit, Sean McCree who writes mostly
00:32:16
features for the New York Times asked who who did you find out who who did this stoppage of weapons to Ukraine? And
00:32:25
he said, I don't know. Maybe you can find out. And he goes, "Well, doesn't that say something about you that you don't know how it happened?" And he's
00:32:31
like, "I know everything." And the whole thing was that was a moment where like someone actually said what is happening
00:32:37
here, which is this man doesn't know what's going on. Like I don't know how these people internally
00:32:43
do this. I mean, I maybe you can explain. I don't know. I'm just I can't believe the legacy of this tariff war is that
00:32:51
there Trump's tariff war has in fact inspired
00:32:57
a massive amount of deal making. Mhm. But here's the issue. It's inspired deal
00:33:02
making amongst other countries. The EU and Merkasaur are talking. The EU and
00:33:07
India, Japan, South Korea and China are having trade talks for the first time in a while. Europe is having very serious
00:33:13
talks with countries in Brazil. They've all said, "Let's use this as an excuse to figure out how we can just basically
00:33:20
I mean the the way I would describe our trade talks right now is we're the drunk
00:33:25
uncle shirtless at a barbecue trying to show off his karate moves and the whole
00:33:31
family." Okay, karate. The whole family The whole family has decided to get on a WhatsApp and not
00:33:37
invite this guy. Let's be a family. Let's talk to each other and just don't invite the crazy [ __ ] uncle. Yeah. At
00:33:43
one point he had a lot of money. At one point we thought we could count on him, but he's gone batshit crazy.
00:33:49
What Why are the markets yawning? Why are the markets just yawning? Because because I mean the reality is
00:33:54
the US is actually quite trade independent. We're actually quite self-sufficient. And that is other
00:34:01
nations can hurt us, but we're energy independent. We're food independent. And also because of Taco the market has said
00:34:09
I mean literally when he announced these 25% tariffs on Japan and South Korea
00:34:14
saying this will force them to the table the market said okay let's look at the actual threat they're excluding certain
00:34:20
products because these guys don't have the balls to actually come after our real products. So the actual tariff rate
00:34:27
was going to go from 15 to 16%. And guess what? The Cosby or whatever it's called and the Nikkay were both up that
00:34:33
day because they said if this is his biggest threat one, it's not going to happen because he keeps he keeps
00:34:39
extending the deadlines. This is literally I I'm leaving you this time. I mean it, you know, 40 years into the
00:34:45
marriage, right? I've had it. I you I'll be at my sisters. And what do you want
00:34:51
for dinner just in case I swing by the grocery store on the way home? Nobody takes this guy seriously. The markets
00:34:57
have basically said just yawning. The world is going to continue to churn on. America will lose some business.
00:35:04
American consumers will have some inflation that disproportionately hurts lower and middle inome people. But the
00:35:09
Dow and the NASDAQ, which will become a wealth index for the top 10%, they are just fine. The market
00:35:15
and they did get the tax break they wanted. So that's they're happy with that for for sure. Um uh last question
00:35:21
and then we have to move on. Um, do you when does it start to really hurt? It it
00:35:26
does it or doesn't it? Doesn't it? Because these farm workers thing just keeps me thinking is like hospitality
00:35:32
farm workers with doing these crazy raids that they're doing. And by the way, there's new stories um showing up
00:35:38
that a lot of people inside ICE aren't happy with their jobs because they're hated. They don't they think it's they
00:35:44
have the Trump people on their ass. They don't think they're doing a good job. They they feel kind of sick to their
00:35:49
stomach about what they're doing. some of them they'll find brutal people that continue their their behaviors but um
00:35:56
it's a really I don't when is it going to like crack is or not necessarily I
00:36:02
mean the only thing that seems certain every time one of these deals goes down or something else is that someone knows
00:36:07
ahead of knows about them ahead of the deal like someone something happened with Brazil futures or something and
00:36:14
someone knew and made a ton an investor all these investors seem to be getting information from the white house before
00:36:19
things are announced um and make money in the interim. But what when does it crack? Beside, you
00:36:25
know, when does it crack? Or maybe it doesn't. I don't know. When you say when does it crack? The tariffs. When No. When does it like count? When
00:36:32
does the economy start saying no or it just doesn't? It just doesn't. Could the economy stay?
00:36:37
Well, the economy it appears to grind on. I think unfortunately a lot of these effects when you're talking about
00:36:44
turning off the tap of an inflow of the best and brightest through through kind
00:36:49
of new age gestapos with Wi-Fi ice when you're talking about not letting in the
00:36:55
most talented young people in the world are PhD students when you're talking about reducing funding through universities that create everything from
00:37:01
DARPA to diabetes medication. Yeah, that that starts that starts to haunt you.
00:37:06
But it's a poltergeist that kind of rises slowly. So unfortunately he's the
00:37:12
mother of all deficits and that is the deficits right now it's champagne and cocaine with the tax cuts this year
00:37:17
because it will be stimulative to the economy. But then in 10 20 years our kids have to pay it back. And he's doing
00:37:24
exactly what the government is not supposed to do. The government is supposed to be making hard decisions to create long-term prosperity and
00:37:30
emotional health for Americans. And they're doing exactly the opposite. They are planting landmines which will
00:37:35
detonate 10 20 years from now long after he's gone but also too which
00:37:41
is amazing but the Trump family will go on. All right let's take let's go on a quick break. When we come back we'll talk about the shakeup at Apple and some
00:37:47
other stuff. Scott, we're back with more news. Apple COO Jeff Williams will retire from the company later this year.
00:37:52
The company says the move is a part of a long planned succession. Uh Sabi Khan,
00:37:58
Apple's VP of operations will take over the COO role later this year. Well, Williams continues to oversee design and
00:38:04
health initiatives until retirement. Williams first joined the company in 1998 and had a hand in introduction of
00:38:10
the iPod and iPhone and led the effort on the Apple Watch. The CEO was seen as a potential successor. I think one of
00:38:15
the top ones along with Craig Federici and John Dis. And then there's there's a
00:38:21
uh another candidate woman uh Deardra O'Brien who's been doing a lot of the jobs Tim Cook has been doing a very
00:38:27
close associate of Cook but but this guy was seen as um that and nobody really
00:38:32
pays attention to the um that issue at Apple even though it's probably pending
00:38:38
relatively soon and the next CEO is going to have their hands full with a lot of challenges. Uh Tim has sort of
00:38:43
ridden this high high up, but they've got a lot of challenges coming up including an AI and elsewhere they just lost an AI head to um Meta. Any thoughts
00:38:51
on this? I think look, I think this is an incredible company. The the announcement I saw that I wanted to get your
00:38:57
viewpoint on is they say they're going to shift their production of iPhones from um China to India and and they
00:39:05
claim they could do it in like two years and I'm like that's going to take 10 or 15 years. But to to your specific point about succession planning,
00:39:12
Apple has in my Apple just has an incredible bench and really deep talent
00:39:17
and they don't have defections. It's not a revolving door. I think they are very good about I just think they have just
00:39:25
an incredibly deep talent pool and I would imagine you know people go to they have a
00:39:34
pipeline of incredible human capital and also Tim Cook Tim Cook strikes me as the
00:39:39
kind of CEO kind of the first tell of a CEO from a board member in my view is
00:39:46
you a good public companies demand that once a year they spend some time on succession planning. And if the CEO is
00:39:54
obviously spending time trying to figure out how to mature, hold on, and
00:40:01
compensate and put in front of the board at least two or three people that could
00:40:07
take that could slip into his or her shoes. If they're not doing that, that means they're like many CEOs, you can
00:40:14
understand, self-absorbed, a narcissist, and not thinking about shareholder value. really good CEOs. I mean, the
00:40:21
CEO, I remember the first thing I thought, the CEO at the New York Times when I was on the board there, I'm like, she's not a good CEO. She's not she's
00:40:27
shooting everyone that gets close to the Iron Ring. She's not she's not maturing successor. And really good CEOs make an
00:40:35
effort to bring in other people and give them exposure to the board such that there are like f I bet I bet at Apple
00:40:42
there are literally five or six people that could do a reasonable job of being the CEO of that company right now. Let me go through them. hardware
00:40:48
engineering chief. John, I think it's Charis. He's a younger guy. He's apparently very dynamic. I've never met
00:40:54
him actually, but he's he's moved up pretty quickly. Obviously, Craig Federici has been around forever and
00:40:59
very um competent and you see him at a lot of the events. He's the head of software engineering. It's done a lot of
00:41:06
jobs. Uh this Deerra O'Brien has run retail. She's done all kinds of things and a lot of logistical stuff that that
00:41:13
Cook did. She did. She's she has the most similar pattern to Cook. And what was interesting about Jobs is nobody
00:41:18
thought that it was Cook that was going to get it. And Jobs was a very good CEO and was also bringing people along.
00:41:24
There was another more flashy person they thought might get it. But Jobs anointed Cook, which I think has turned
00:41:29
out to be one of the best decisions. Speaking of which, from a CEO um from a CEO's point of view, he's really he
00:41:35
really set it on a course of real after his death, real um explosion and value
00:41:41
and and everything else. So there's a lot and then there's many others. And one of the things that struck me when I was looking at this list is among the
00:41:48
people on there now a lot of them are older but not all of them are um is that um everyone on that list when people
00:41:55
were when Walt retired the Apple who had been who had covered a lot gave a little
00:42:01
his last Apple event gave him a little cocktail party all those same people were there like I was like oh look and I
00:42:08
went and I don't I didn't really mix with Apple C executives that much I mean I know them but even among the ones that
00:42:15
aren't on the top, they're all really competent. Eddie Q, etc., etc. So, yeah, you're right. It's a very no drama kind
00:42:22
of group of people. So, we'll see. I don't know. What do they need to focus in on the uh the Apple next Apple CEO
00:42:28
for if you had to pick one critical thing going forward? Say Tim retired tomorrow. What's the biggest I guess AI
00:42:34
would be my choice? That's a really interesting question. I I think you invest in your your
00:42:41
opportunities. And I've always thought Tim sort of he'll be remembered I think
00:42:47
as a guy who was able to to take the innovation and the marketing genius of Steve Jobs and what he did was so Steve
00:42:53
Jobs kind of branded or set or lioniz or canonized the great
00:42:59
marketing age. He was just such a showman, right? And also the decision to take $6 billion out of advertising and
00:43:05
create 550 temples to the brand called Apple stores and go vertical. That was in my opinion that was almost the same
00:43:12
level of genius as the iPhone cuz other people had as good iPhone. No one has Apple stores. There's just no what
00:43:18
distribution and tech Microsoft. Do you want to go hang out in a Microsoft store? I mean
00:43:23
let me tell you people laughed at Jobs back then if you remember. Do you remember that? People don't. Although it was a big opening. I was there actually.
00:43:30
But people laughed at him for doing Incredible. I mean that it really is going vertical. He he revolutionized
00:43:36
technology and what it meant to spend money on marketing by going by controlling your distribution. You go
00:43:41
buy an Android phone, you walk into a place with bad carpeting and a guy living in his parents' basement with a name tag and you think, Jesus Christ.
00:43:48
And then you go into an Apple store and you're like, "Do they serve lattes here? Cuz I'd like to take a date here." I
00:43:53
I mean, think about those places, right? Mhm. So he kind of marked the branding age.
00:43:59
Really? Tim Cook marked the supply chain age and that is he built the most complicated robust supply chain in the
00:44:06
world and basically said I can give you what would have cost you a million dollars 10 or 15 years ago. I can
00:44:13
produce it for a,000 bucks using the most complex robust supply chain mostly out of China that brings together 1,600
00:44:19
parts and produces a million of these things a day with a downside they trained up China but go ahead. Yeah. And also quite
00:44:26
frankly became very subject to sort of the political machinations of a [ __ ] weirdo with his head up his ass called
00:44:32
the president. So the question is with the ne when they think of the next CEO, I don't think it's going to be a branding person. I
00:44:38
don't think it's going to be a CMO. Is it going to be someone who tries to take them into the AI future or do they
00:44:43
say we're still a hardware company and it's about supply chain? I I don't know. What do you think? I don't know. I think they're all
00:44:49
qualified. If I had to guess, this this hardware engineering chief is younger. I think they need to go younger. Um, and I
00:44:56
know it sounds dumb, but these guys like I I think I I think the world of someone like Craig Federici, but he's almost too
00:45:02
old, right? You know, you just saw a departure from Amazon, too, of someone who'd been there 17 years. I mean, at
00:45:08
some point I a lot Apple reminds me of like the Rolling Stones. They still can really do a really good concert, but at
00:45:15
some point you're like, "Okay, like it's enough, right?" You know, at some point you're JLo. Yeah. Exactly. Like stop. It's okay. you
00:45:22
you you know it's kudos to you. I I think about that a lot cuz um you know
00:45:27
we don't think about leaving right now but at some point it's like I've done enough now everything else is great and
00:45:32
I think this group of people is like that. I think probably how to deal with AI and and more software and services is
00:45:37
where I would focus. Typically the person who gets the CEO role is not the best person. It's the person
00:45:45
who happened to oversee the unit that at that moment is growing the fastest. Yeah. And that's not to say like Andy
00:45:50
Jasse is my sense a very competent person, but you just knew the head of a AWS was going to be the new head of
00:45:57
Amazon. Absolutely. Yeah. So I remember when I was at Levi Straen Co and talking to the CEO then about
00:46:02
succession planning when I was a consultant there and I'm like well I know who the next CEO is. I'm like which region is growing
00:46:08
the fastest right? That'll be your next CEO. Interesting. So we should look at that. If you looked at which part of Apple,
00:46:14
whether it's their services unit, I don't know, their lap, whatever it is, maybe the person in charge of the iPhone, they will the person who's
00:46:21
usually the CEO is the person who is lucky enough. And also the fact that they're appointed to the most important region or group in the company says
00:46:28
they're very good. But it's easy. I mean, it it I'm I'm going way back to my
00:46:34
in the 90s when I was consulting Levi Stson Company. When you were the head of Levis's in Europe and you got to get you
00:46:41
got to charge $140 for a pair of 501's in Germany that you were only getting 30 bucks for in the US, it was really easy
00:46:47
to look really [ __ ] smart. Yeah. Yeah. True. True. So, which group which group at Apple's growing the fastest? That's what I
00:46:54
software and services software. That would be Craig Federici. I mean, it just would be it wouldn't be the new era.
00:46:59
That's all I'm saying. And again, totally competent and probably do a great job. Anyway, we'll move on. One
00:47:04
last thing. Uh, Shien, your one of your favorite companies, has conf confidentially filed an IPO in Hong Kong
00:47:10
18 months after filing to go public on the London Stock Exchange. The company has struggled to receive regulatory
00:47:15
approval in London is attempting to put pressure on the UK. The company's been pushing back against UK regulators who
00:47:21
want more transparency about its labor practices in China, which is no surprise. Shien was valued at hundred
00:47:26
billion in 2022, but that dropped to 66 billion in 2023. Um, any predictions?
00:47:33
I'd love to hear what you think. I know you think the world of this Well, a lot of people don't, by the way, this this sort of fast fashion thing,
00:47:41
etc. But what do you what what should happen here? What do you imagine it'll just go public in Hong Kong? Correct. I
00:47:46
mean, that's would be my guess. 200 companies have filed for an IPO this year. The Hong Kong The bottom line is
00:47:52
the Hong Kong market is on fire. the London IPO market with the loss of this IPO. I mean, I
00:47:59
I love I I really have I'm starting to get sentimental about the UK because I I'm I'm I've been there three years. I'm
00:48:06
I'm going to I'm going to move back to the US and I love it there. And they have all of the underpinnings of a of an
00:48:13
economy that should be booming. Great intellectual prop property, an incredible culture that attracts some of
00:48:19
the best and brightest in capital. really really aggressive smart people.
00:48:24
They can't get out of their own damn way. And for them to have Sheen will
00:48:30
probably be one of the biggest IPOs of the year. They should have done anything they could to try and breathe new life
00:48:36
into their IPO market because as of now the uh is it the LSE or whatever it is
00:48:42
is basically done. It's out of business. The UK might as well close shop in terms of IPOs. And what's interesting is
00:48:48
actually the London exchange would say it wasn't our fault. They couldn't get Chinese approval. But anyways, that's
00:48:53
another another talk show. Meanwhile, while no, while while you were sleeping, the Hong Kong market is on fire. And so
00:49:00
Sheen is just going to where the money is. They're going to where they can a have the most seamless path,
00:49:06
right? Without being asked too many questions, too many thorny questions. Sure. And so one, they deserve to have
00:49:13
scrutiny. Fast fashion raises a lot of very troubling questions. But two, what Sheen would say is, "Okay, now do Nike,
00:49:20
now do Apple." And a lot of the a lot of the people pushing back on this this
00:49:26
company are people are are organizations sponsored by incumbent retailers who would rather just keep selling you
00:49:31
Kashmir sweaters for $200 versus 40. So, but I do think they're going to get out
00:49:36
in Hong Kong, but they're just going to where there where there's where it's a seamless route to an IPO and the Hong
00:49:42
Kong market. who would have guessed it is on fire right now. Yeah. Well, that's interesting. You're
00:49:49
sad about London. How cute. How cute. It is true. When I go to London, I think, look at all this creativity. Why isn't
00:49:54
it more dynamic? Like, do you know what I mean? 70% of the companies have gone public in the last 10 years or below their
00:50:00
offering price. I I know. It's really fascinating to me. Anyway, name an important tech company in the
00:50:05
UK. You can't I I I've had this debate with people in England a lot. I told you this
00:50:10
years ago. I went there for it was called Silicon Valley meets Cambridge or Oxford I can't remember and it was like
00:50:17
me Reed Hoffman a whole bunch of us and we debated and Reed and I had to argue in in the next and this was 20 years ago
00:50:24
at this point um in the next five years who which country was going to have the most billion-dollar companies and Reed
00:50:31
and I had to argue US and the British people had to argue London and we gave
00:50:36
all these we did a really good job but we lost because it was a British audience But um but but I remember
00:50:42
thinking there's no freaking way this group of people is going to be able to be as dynamic and they didn't. And at the time we said Google da da da da da
00:50:49
and and and I said and we were like England zero. It was like there was one
00:50:55
company the one the guy who died in that sailing accident that guy he had a company um that got all messed up and
00:51:00
controversy. But that was there was one UK company that had dynamism and it was
00:51:06
just interesting. Anyway um I will be sad you're leaving there. I didn't come and stay with you there. H I need to do
00:51:12
that quickly. Um Oh, trust me. You will. The house will be there. You'll Well, the I know you'll be away soon.
00:51:17
Pretty soon I'll pretty soon you'll be on podcast drinking tea like yelling at my dogs. Your socks off.
00:51:25
Yeah. Yeah. Yeah. I will. I'm going to plan on it. All right, Scott. One more quick break. We'll be back for
00:51:30
predictions. Okay, Scott, let's hear a prediction. Actually, can I do one really quickly? Of course. Okay, so OpenAI is getting
00:51:36
close to releasing an AI powered web browser. According to Reuters, the browser is slated to launch in the next few weeks and will be competing with
00:51:42
Chrome, giving Open AI a way to access uh user data. Perplexity just launched
00:51:47
its AI powered browser, Comet, this week. I don't know who the winner of the browser wars could be, but I couldn't be
00:51:54
more delighted that there is now competition in this area. Microsoft tried very hard. Um Netscape was the
00:52:01
original one. it got ran over by Microsoft, which then got ran over by uh Google. Um, and I love I'd love to see
00:52:08
what the next generation of browsers brings. Not that I use a browser that much anymore, but I it should be
00:52:14
smarter. It's so dumb when I use it. And so I think it's I I suspect OpenAI will
00:52:20
have the most popular one given they're the most popular. Everyone I talk to uses ChatgPT. It is the Kleenex. It's
00:52:27
the Google of the situation. That doesn't mean it's going to last forever because I think Claude is considered better by many people. Perplexity has
00:52:33
interesting things. But I'm really excited about this thing and I I suspect the winner is going this is I predict
00:52:39
the winner will be open AI and not Google because they haven't innovated
00:52:44
enough on this and so the people that with an interest in winning are the most innovative. So that's my prediction.
00:52:50
Thank you. I like it. Um I think that's interesting. Um
00:52:56
but I'll I'll be quick. these new tariff threats, 90 deals in 90
00:53:02
days. It's going to be what I'm predicting is the mother of all Rebovvens. Remember when what's that?
00:53:07
Well, the Rebovan was that ridiculous van and distraction when when Tesla had their quoteunquote last autonomous
00:53:14
vehicle launch. They're like, "Oh [ __ ] we have nothing here. Let's let's let's drive up a big bus and say
00:53:20
that we're launching a van and let's have let's have robot let's create distractions." You're about to see the
00:53:27
Trump administration go into panic mode when all of these countries that they keep extending the deadline and keep
00:53:32
sending out threatening letters just say, "Uh, sorry, boss. We're we're not we're not showing up. We're not you
00:53:38
know, you can threaten us all you want." They'll they you're going to see the most ridiculous jazz hands in the next 3
00:53:46
weeks claiming victories. First off, these two quote unquote trade deals between the UK and Vietnam aren't even
00:53:53
deals. their agreements to talk about a new deal and you're going to see them start to announce the most ridiculous
00:54:00
hollow victories to try and you know turn chicken [ __ ] into chicken salad, put lipstick on a pig.
00:54:07
Yeah. I mean, this is just it is so it is going to start to get comical the
00:54:14
[ __ ] they're going to announce and pretend is a victory. It's credible. It is an incredible thing. It doesn't really work either.
00:54:20
That's what's interesting about it, does it? Well,
00:54:25
what what this what they would never do is admit defeat or just move on. They're
00:54:31
going to they're going to say, "Okay, uh Paraguay has said that they're going to,
00:54:37
you know, they're they're going to talk to us talk to us about u uh a new tax
00:54:44
credit if Ford um opens more dealerships here." And they're like, "Okay, put out a press release that we have a new deal
00:54:50
with Paraguay." M you're going to see the most ridiculous announcements claiming victory
00:54:56
in the next few weeks because Muldova is sending us a box of nuts. It's going to be I do have I do have a number of friends
00:55:03
who work in who work in um um the State Department or work in um the equivalent of the
00:55:08
State Department in other countries and they're like, "Yeah, we we're not doing anything. We don't we're don't we're not
00:55:14
responding. I have to say, you know, we're being polite, but we're not doing anything. We don't want to piss the guy
00:55:20
off, but we're not. But it's so interesting. When is the point where they're like they don't care about pissing him off because the lying
00:55:25
is really one of my favorite li Well, okay, I'm going to say I don't know what she's doing, but Susie Wilds gave this
00:55:31
interview. She doesn't usually come out behind the woodwork where she is usually living at the White House where she runs
00:55:36
things and was like, "I don't know what happened to Elon and how the falling out happened." I'm like, "There's a knife in
00:55:42
your hand, honey." Like, it was really kind of funny. But they they do manage to just proaricate almost all the time.
00:55:51
It's really something and and everyone knows they're doing it anyway. Uh hopefully it won't hurt the economy too
00:55:56
much or people's livelihoods. Um anyway, uh that those those are really good predictions, Scott. I think you're 100%
00:56:02
right. Uh we want to hear from you. Send us your questions about business tech or whatever is on your mind. Go to nymag.com/pivot
00:56:08
to submit a question for the show or call 8551 pivot. Elsewhere in the Cara and Scott universe this week on Profy
00:56:15
Conversations, Scott spoke with Heather Cox Richardson. Fantastic uh for you to talk to. Uh she's a historian and author
00:56:22
of Letters from an American. Let's listen to a clip. But that idea that
00:56:27
patriotism belongs to a certain party has turned out to be, you know, really quite poisonous. And you see now the
00:56:33
elevation of partisanship over country even in things as recently as the budget
00:56:38
reconciliation bill. So there is a perversion of patriotism that we see going on around us. But reclaiming a
00:56:45
broader patriotism that shows an allegiance to the country rather than to a political party. You know, we've done
00:56:50
that repeatedly in the past. And the answer to that is simply to return to the foundational principles of the
00:56:56
American democracy. The idea that we should be treated equally before the law. We have a right to a say in our government and we have a right to equal
00:57:02
access to resources. Yeah. Good. She's great. Did you enjoy that? It's funny. the emotion I felt. Um, it
00:57:09
was a really, in addition to her being so impressive, it was a nice lesson for
00:57:14
me because I am I was actually quite insecure during our conversation cuz she kept putting questions back to me and it
00:57:19
was quite humbling because what I recognized is that she she gave me the sense and this is important. She helped
00:57:26
me know how little I know about certain topics. She has such deep domain expertise. She is so forceful yet
00:57:32
dignified. And I thought, you know, I really should be more measured about some of the [ __ ] I speak about because
00:57:38
this is a this is what a real expert feels like. And I asked her to talk about to equate
00:57:44
uh 30s Germany and what's going on there to some of the attacks on democracy here. And she said, you know, that's not
00:57:49
my area of expertise. And I remember thinking, she has more knowledge about that in her [ __ ] finger than I have,
00:57:56
but she doesn't want to talk about it because she takes her role and her expertise and where she has expertise
00:58:02
seriously enough to say I don't know enough about that to comment on it. And I thought that is a good lesson for a
00:58:08
lot of us. It's true. It's true. But she is she is really impressive. Oh my gosh.
00:58:13
I love an academic like that. I like like occasionally you
00:58:19
I've always said that like I work with one of the best faculties in the world. Half of them should be put on a [ __ ]
00:58:24
ice flow. They're doing nothing but causing problems. Well, focus on the ones that shouldn't be in a guild in a union that that
00:58:30
translates to student debt. 30 or 40% of them are doing their job and a good 10% of academics are
00:58:37
literally some of the most impressive people you're ever going to meet. Okay. And she's one of them. Yeah, she is.
00:58:43
Okay. And you are too, Scott. You were a very good teacher. Go on. So, you're still I think students would really like to see you back in that
00:58:48
room. And when you go to New York, I think you should do a class. That's my opinion. Anyway, that's the show. Thanks for listening to Pivot and be sure to
00:58:55
like and subscribe to our YouTube channel. We'll be back next week. Scott, read us out. Today's show is produced by Lara Joy
00:59:02
Marcus, Taylor Griven, and Kevin Oliver. Ernie Andot engineered this episode. Thanks also to Drew Bros. Miss Severo and Dan Shalon. Nishak Kuru is Vox
00:59:08
Media's executive producer of podcast. Make sure to follow Pivot on your favorite podcast platform. Thanks for
00:59:14
listening to Pivot from New York Magazine and Vox Media. You can subscribe to the magazine at nymag.com/pod.
00:59:20
We'll be back next week for another breakdown of all things tech and business.
