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Former Prince Andrew Arrested — Will Epstein’s Network Face U.S. Justice? | Pivot

February 20, 2026 / 01:05:26

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I think the UK just demonstrated more

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institutional courage in one morning

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than the entire US Department of Justice

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has managed in five years.

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>> Hi everyone, this is Pivot from New York

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Magazine and the Vox Media Podcast

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Network. I'm Cara Swisser

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>> and I'm Scott Galloway

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>> and I am a trad wife.

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>> What does that mean?

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>> I made bread and butter this morning.

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butter from scratch and I made this

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delicious bread. Let me unwrap my

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>> You're really proud of it. You sent me a

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a photo of it.

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>> I know. Well, I am. I made it. I I I

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know it sounds really stupid, but I get

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I I'm on in Here's the whole bread. You

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can see it. Everybody see it. It's a

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It's a loaf of It's a baguette. This

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today is a baguette. And I also made

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butter with a marble and a jar and some

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heavy cream uh last night at dinner.

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Fresh butter. I'm going to make cultured

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butter next. Um, I I get on Instagram

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and I'm obsessed with watching uh food

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videos and I save them and I'm starting

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to make all of

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>> What's the next thing you're going to

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make?

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>> Uh, we're going to probably make another

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bread. Bread. We're going for bread and

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butter. We like bread and butter cuz I'm

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a trad wife. So, anyway, there you go.

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>> Yeah. No, I think I like that white

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supremacist baking company. And he said

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that his family had a long history of

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being in bread.

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>> Oh, I can't believe you have a bread

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joke. Um, I have to say it takes me out

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of um

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>> takes you out of your head.

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>> Out of my head. Like I It was an It was

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advice, you know, from doing this series

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that's coming out. I I spend too much

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time in my head. And so Zeke Emanuel

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suggested he makes honey. I was like,

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I'm going to do things that isn't in my

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head. And I have to say, I'm baking is

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really chem, you know, it's you have to

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pay attention and I'm learning. And so

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it's and it's totally you cannot pick up

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I mean, I have the phone there with the

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rest as they're talking to me, but it's

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a useful use of the phone, I guess. I

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don't know what else to say. Anyway, I

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really like it.

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>> So, two muffins are in the oven when one

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turns to the other and says, "Man, it's

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so hot in here today." And the other met

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and the other muffin says, "Holy [ __ ]

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it's a [ __ ] talking muffin."

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>> I can't believe you have bakery jokes,

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>> Cara. My wife has been sleeping around

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with other men. Our church pastor is

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coming over tonight to offer advice, and

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my wife is baking cookies, but I'm

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embarrassed because the cookies are

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homemade.

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I could do this all night.

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>> Why do you have them? Are you on the Did

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you suddenly get on the internet and

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said baking jokes? Is that what happened

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there?

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>> No, I have a I have an incredible memory

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um for 1970s Ram playoff losses and for

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dad jokes. That part of my brain is

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alive and well.

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>> Any we've got a lot to get to today, so

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let's dig in. Um this is an astonishing

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development. former Prince uh Prince

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Andrew has been we call him former

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Prince Andrew right now uh used to be

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known as Prince has been arrested on

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suspicion of misconduct in public office

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by British police. You know he should be

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arrested for something else but this is

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what they could get him on. The full

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details of the arrest are not clear at

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the time of the taping but former prince

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has been under increasing pressure after

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the latest release of the Epstein files.

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Andrew Moundbotton Moundbatton Windsor

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which is his name was previously

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stripped of his royal title due to his

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uh involvement with Epstein mean finally

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after many many years of this. Meanwhile

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Casey Wasserman has decided to put his

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talent agency and marketing firm up for

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sale amidst criticism his past

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relationship with Gilain Maxwell. Uh

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there's a ton of people Dean there's so

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I sent you the list of people that are

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you know obviously um uh Larry what's

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his name Larry oh Summers uh stepped

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down Dean Cayman is having trouble he's

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the famous robotics guy um all all

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manner of people the former prime

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minister of Norway um everyone but the

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guy who said they let you do it grab the

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[ __ ] guy is not being investigated but

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uh this is really interesting so from

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you're not in England right now. But

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what explain to people what this is

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like, what this this is akin to

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arresting a royal.

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>> I think the UK just demonstrated more

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institutional courage in one morning

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than the entire US Department of Justice

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has managed in 5 years.

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>> Yeah.

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>> And

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it's just ironic. You know, my attitude

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is, okay, now do Epstein's flight logs.

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I mean,

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>> yep. This is I mean some of it's

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probably pretty political. The the crown

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is probably looking to try and renew

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their brand in an era where monarchies

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are fading. This really is the last

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monarchy

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>> and also the prime minister is feeling

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heat and potentially calls for his

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resignation. But I think that I think

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the UK quite frankly is actually

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showing some fidelity to the notion that

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no one is above the law. Yep.

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Absolutely. I I agree. One of the things

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that's really that's really important is

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the investigation should have gone on.

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These investigations that should have

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happened when how badly prosecutors over

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the entire period of time um from down

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in Florida to now have [ __ ] this up.

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And in terms of I think the moment with

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Pam Bonnie and she had never talked to

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those people like all of them are liars

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like I don't know why don't you do an

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investigation? And so she's obviously

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not going to because she's bought and

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paid for. But um but the fact that they

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didn't do investigations here on as you

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say the people who are criminally liable

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and the other people who are getting you

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know Bill Gates had a pull out of

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something because of this look that'll

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play itself out because that's about I

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don't think it's about shaming. It's

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about like gh bad judgment. People are

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going to have to pay for their actions

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eventually. Um, but the criminal

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investigations that haven't gone on

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here, the the ability and I have to say

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we owe a debt of gratitude to uh uh Roan

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and Thomas Massie for pushing

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>> this through and we need and the the

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redactions that this Bondi Justice

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Department is doing are you know there

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Ted Lou who is a a trained lawyer got up

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and said there is credible evidence that

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Donald Trump um this is what he is

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saying. I have not seen these things

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that he he uh he

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sexually uh attack sex what is the right

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way to do

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>> assaulted

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>> assaulted an underage girl and for him

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to get up and say that at knowing that

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he's a lawyer is really something like

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and of course Trump is saying he's

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exonerated he's not exonerated he hasn't

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been investigated properly right and so

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you know when he said let me just read

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this again maybe just maybe um as this

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fedded penny drops. Maybe it wasn't

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locker room talk, right? Do you remember

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that? I mean, this is what he said. Let

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me read it. I don't even wait. And when

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you're a star, they let you do it. You

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can do anything. Grab them by the [ __ ]

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You can do anything. I don't know if he

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did anything, but I'd like to have

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investigators really. I don't know if

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they need an independent investigator or

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>> special counsel.

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>> Special to me. I never like those

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things, but in this case, everybody's

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dirty, right? And certainly Pam Body has

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no business being in the job she's in.

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They should they should have a special

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counsel release all the files and

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especially the criminal stuff keep it as

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maybe not release those because they

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really need to and it might not lead to

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anything but to show that we have what

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the UK is doing and it there may be a

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statute of limitations by the way Scott

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on this stuff. I don't know.

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>> That's what's kind of interesting about

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this specific case with Prince Andrew is

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that or the person formerly known as

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Prince Yeah, the

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>> I know it is kind of funny, but he's not

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funny. He's gross.

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>> But when when the feds come for you and

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say you've clearly committed engage in

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criminal activity here, they usually

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don't get you for what you know they

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didn't. They got Al Capone for

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moneyaundering or for for

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>> No, no. For taxation.

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>> Yeah. For tax evasion.

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>> And Prince Andrew isn't being accused of

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sexual assault. He's being accused of

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passing state secrets to a convicted uh

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felon. But that's the point. The point

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is if you commit crimes our you know our

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reach is far and our memory

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uh is long and now I have a different to

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me this is how you handle the Epstein

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files and that is I don't think the

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Epstein files should have been released

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>> uh I think that the Department of

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Justice

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>> gets sullied I I know what you're

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thinking right

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>> I think the Department of Justice and a

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team of lawyers including outside

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lawyers contracted for this very

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important case should have gone through

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these things with a fine tooth hair and

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comb and said, "Okay,

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we're going to communicate to the public

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what is in these files visav grand jury

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indictments and prosecutions."

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Because I think what has happened is

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I think we have been so played here.

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Cara, if I was advising the Trump

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administration on how to dilute

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the depravity here and to get him out of

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this, I would be doing exactly what

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they're doing. And that is by dripping

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it out sclerotically

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uh uh incorrectly. Some stuff's

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redacted, some stuff isn't. And then we

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all chase. We're like a Tyrannosaurus

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Rex. Wherever we see movement and

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violence and ringlight algorithm

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shaming, we start talking about [ __ ]

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Deepo Chopra.

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>> And what the

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>> We should talk about him too, but go

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ahead.

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>> I I disagree. I I think it's it's the

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Department of Justice is a there for

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criminal indictments and to create

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incentives such that if you have a

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daughter and you're a single mother and

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your daughter gets invited to some

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[ __ ] island that there's incentives

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that people who feel entitled to rape

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your daughter won't. Yes.

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>> Whether or not someone is a creep or not

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is a distant distant second. And all of

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this [ __ ] has diluted the criminal

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activity.

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>> I don't think it's [ __ ] I think

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it's part of the same thing. And this is

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like, let me just say, who's the person

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that said Epstein had legs? This whole

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thing had legs a long time ago when

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everyone thought it was going to go

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away. This is one at the heart of the

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MAGA infrastructure. As I noted, it is

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also at the heart of a lot of it's true,

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right? Some of it's true, some of it's

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not, but it is part of a whole

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movement around corruption of the

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elites. And this is the worst version of

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it. And I think we do need to talk about

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people. Andrew did this because he

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>> I'm on board. And Andrew is being

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criminally prosecuted.

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>> But I'm saying he did it because he

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thought he didn't, as you say, he's not

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bound by the law. Right. Right. Now,

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breaking. New Mexico investigators open

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a probe into whether Epste ordered the

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burial of bodies on his Zoro Ranch

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property. We need to investigate this

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fully and wherever it takes us for for

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it to have to just get out and get

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everyone's attention, the normal people,

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not the QAnon people. I think it's I

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think this has so many drip drip drip

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legs that it's going to is absolutely

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going to reach Trump.

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>> This should have been dozens if not

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hundreds of indictments and prosecutions

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from an institution we trust.

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>> That's right. We don't trust the

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appointment of a special counsel.

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>> Saying a cabinet member didn't look to

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commit a crime, but when he went under

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oath in front of Congress and bragged

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that he had nothing to do with this

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person.

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>> No, he did that on a podcast, but go

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ahead.

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>> Well, he he Oh, really? He hasn't done

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it under oath?

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>> No. No, under oath he told the truth.

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Um, so

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I feel that all of the liar I feel all

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of the shaming feels really good and it

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does say something about these

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individuals. I think it is deliluding

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and weakening the case against the

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actual criminals here.

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>> Well, I don't know. I think you can do

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both. I can can just walk and chew gum

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at the same time. And well, I think, as

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I saying, let me move to the next thing

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because it's part of this everyone's

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tired of these [ __ ] rich people

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taking everything. Like so right now

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Mark Zuckerberg took the stand this week

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that in this landmark social media

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addiction trial defending Meta against

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claims Instagram was designed to hook

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young users and damage mental health.

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Zuckerberg said in his testimony that

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Instagram was not a harmful product.

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It's a valuable service. Of course he'd

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say that. He said that all along. He

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believes he's navigated the safety of

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young users in a reasonable way. He has

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not. He also defended the company's

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decision to allow beauty filters even

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after experts warned they could harm

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teen girls, including people internally.

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Um, when pressed about old emails and

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growth targets, Zuckerberg repeatedly

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pushed back saying the same answer more

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than a dozen times. You're

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mischaracterizing this. This is an old

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Mark Zuckerberg trick. We don't

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understand him. Uh, neither of us are

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lawyers and it's a really complex case.

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And what what what two things it's not

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just Facebook, it is also YouTube is

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involved in this one. Others settled

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other social media sites seem to have

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settled here. Um, so and it's not clear

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if YouTube is going to settle before

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this, but this idea of of whether

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they're entertainment or they're

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actually addictive. The lawyers for the

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the tech company sides are going to try

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to portray this young woman who got on

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Instagram when she was nine as troubled

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had nothing to do with social media.

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She's alleging that social media dragged

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her down a hole of shame and

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self-esteem. Um, it's a jury trial. Um,

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I'm putting Mark in front of a jury

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helps a herds. He's he's not great at

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that. And he also, the judge wasn't

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happy to see Meta's Rayban AI glasses

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worn by several members of Zuckerberg's

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team, which I thought was super [ __ ]

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obnoxious to do for Zuckerberg to use it

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as a marketing event. Um, she warned

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anyone wearing smart glasses to be held

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in contempt, noting the concern about

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facial recognition of the of it. Um, so

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just thoughts on this case because I

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think it's really f there's there's

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thousands of more behind it. By the way,

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>> I think John Oaf who's running for

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Senate has come up with a brilliant term

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and that is a lot of Democrat how we

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lose is this stereotyping and and

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keyboard virtue signaling that if you

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like all white people are racist, all

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billionaires are evil, and all young men

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are sexist, fine, they're going to leave

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the party and we're going to and you're

00:13:54

going to have Vance as president. What

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Osaf has done is really smart. He has

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started describing this group of people

00:14:00

as he doesn't say the billionaire class,

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he says the Epstein class. Because the

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majority of Americans like the idea of

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being rich someday and believe that if

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they get richer, it doesn't necessarily

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mean they're going to become depraved

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weirdos.

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So I think that is a really powerful

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distinction that there is a class of

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people

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most rich people I do not believe are

00:14:23

like this but there is a class of people

00:14:25

who believe they are again as we talk

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about

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>> um protected by the law but not bound by

00:14:30

it. There's smoking guns everywhere but

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the the real smoking gun I would focus

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on if I were advising the prosecution

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>> is their own internal research.

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>> So let's go through a body.

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>> It's not a prosecution. It's a it's a

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law civil lawsuit. It's civil, but the

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pe but the people the plaintiff's

00:14:48

attorney or whatever you would call

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their own internal research regarding

00:14:52

body image harm. We make body image

00:14:54

issues worse for one in three teen

00:14:56

girls. This is according to a 2019

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internal Meta presentation. 32% of teen

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girls said that when they felt bad about

00:15:03

their bodies, Instagram made them feel

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worse. That was a March 2020 internal

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presentation. Meta's leaked internal

00:15:09

research showed that 32% of teen girls,

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one-third, said Instagram made them feel

00:15:14

worse about their bodies and the company

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knew it. Addiction by design. Meta

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employee internal message. I I worry

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that driving sess session incentivize us

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to make our products more addictive

00:15:25

without providing much more value. How

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to keep someone returning over and over

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the same behavior each day. Intermittent

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rewards are most effective. Think slot

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machines. In focus groups, teens told us

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they didn't like the amount of time they

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spent on the app and they felt like they

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had to be present. They often felt

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addicted and know that what they're

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seeing is bad for their mental health,

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but feels but they feel unable to stop

00:15:48

themselves. On depression and anxiety,

00:15:50

teens blame Instagram for increases in

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the rate of anxiety and depression said

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another slide in a 2019 presentation.

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This reaction was unprompted and

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consistent across all groups. This is

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their own research.

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>> They also their own research showed they

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have 4 million kids between 10 and 12 on

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the platform when it's not supposed to.

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13 is when they're not they didn't have

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age age verification which isn't very

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good anyway on the platform until 2019.

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They This is what kills me with these

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people. It's like how did how did four

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million It's like oh four million kids

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got into liquor stores somehow. Are you

00:16:30

[ __ ] kidding me? Four million kids.

00:16:32

How did that happen without them knowing

00:16:34

it? When they know everything that is

00:16:36

happening on that platform whenever they

00:16:38

go into this I don't you know kids can

00:16:41

get into things. You know my kid just

00:16:43

got into the refrigerator and took a you

00:16:45

know took a cookie the other day. That's

00:16:47

what they act like and in their own Let

00:16:50

me tell you I can't tell you how many

00:16:52

times

00:16:54

I have heranged Mark Zuckerberg on

00:16:56

safety and people inside the company

00:16:59

heranged him on safety. He just didn't

00:17:02

agree. And because he it cannot be

00:17:05

fired. If the board decides to fire him,

00:17:07

he can fire the board and appoint a new

00:17:09

board that likes him. He he can make

00:17:12

decisions on his own. And we are all

00:17:13

subject to decisions of one person who

00:17:16

has no accountability on him because

00:17:19

been making bad decisions whether it's

00:17:20

about anti-semitism, whether it's about

00:17:23

uh anything. And he always and he did

00:17:24

this again. And I I sighed I sighed for

00:17:27

free speech or not, you know, the filter

00:17:29

thing like, well, I decided not to act

00:17:31

paternalistic. Okay, Mark, don't act

00:17:34

paternalistic to toward adult users. We

00:17:37

get it. But you absolutely have to act

00:17:39

paternalistic towards young people. Like

00:17:42

the the safety issues about young the

00:17:45

fact that they still stick to their

00:17:46

idiotic guns when it comes to young

00:17:48

people. Let me mention another big tech

00:17:50

suit that just broke. Apple just got

00:17:52

sued by West Virginia for alleged

00:17:54

failure to curb child sexual abuse

00:17:56

materials on iOS devices and cloud

00:17:58

services. They should sue Grock. They

00:18:00

should sue all of them for these things.

00:18:03

And this is the way these companies are

00:18:05

going to go down like the cigarette

00:18:07

companies. And they still to me and I'll

00:18:10

stop ranting. His testimony show me once

00:18:13

again he is absolutely intractable in

00:18:15

his decision that everything he decides

00:18:18

is correct. And he it is simply not. It

00:18:21

is simply not. And let me be fair,

00:18:23

YouTube is bigger, but I it's all the

00:18:26

same to me. They're all enormous and

00:18:29

delotterious to the impact on our kids.

00:18:31

Period.

00:18:32

>> Just one more piece of data. Between

00:18:34

2010 and 2015, the number of 8th grade

00:18:36

through 12th graders exhibiting high

00:18:38

levels of depressive symptoms increased

00:18:40

by 33%. In the same period, the suicide

00:18:44

rate for girls in that age group

00:18:45

increased by 65%.

00:18:48

By 2015, 92% of teens owned a

00:18:52

smartphone. And today, here and now,

00:18:54

let's talk a little bit about young men.

00:18:56

Young men between the ages of 20 and 30

00:18:58

are spending less time outdoors than

00:19:01

prison inmates.

00:19:03

The data here, there are hundreds, if

00:19:06

not thousands of families whose kids

00:19:08

have killed themselves. There are

00:19:11

millions of families struggling with

00:19:13

anxiety and depression. And there's a

00:19:16

lot of different factors here, but this

00:19:18

definitively has made things worse.

00:19:21

The the good news is that I do think

00:19:25

finally, and I've said this before and

00:19:26

I've been wrong, but I'm going to say it

00:19:28

again. I think the worm has turned. And

00:19:30

that is typically it takes 20 to 30

00:19:32

years before the public moves in on a

00:19:36

well-funded addictive substance that is

00:19:39

creating harm across our society. It

00:19:41

took us 30 years with tobacco. It took

00:19:43

us 20 years with opiates. It looks like

00:19:46

it's going to take us about 20 years

00:19:47

here. But what you're seeing is it's

00:19:50

getting tied up in politics in sort of a

00:19:52

good way. And that is I think the

00:19:54

tariffs I think the ultimate reciprocal

00:19:56

tariff from different nations is going

00:19:58

to be they're going to start banning uh

00:19:59

US tech companies and they're going to

00:20:01

use this as a valid excuse. They're

00:20:04

going to say you're out. We're age

00:20:06

gating. We're banning this or where

00:20:07

they're going to ban an entire platform.

00:20:09

But it does feel like we're we are at a

00:20:11

turning point.

00:20:13

>> Well, the only this is a jury trial.

00:20:14

This is what's really interesting

00:20:15

because what I think is going to be the

00:20:16

problem for them is and by the way

00:20:18

sometimes like when some of the the FTC

00:20:20

stuff I see why Facebook or whatever

00:20:23

company won in certain ones of them,

00:20:24

right? But jury members either they have

00:20:28

kids and get it

00:20:30

>> know it at in their bones or they

00:20:32

themselves are addicted and call it

00:20:35

problematic usage when it's everybody

00:20:38

who you I'm addicted to food videos on

00:20:41

your on threads, Mark. I can't stop

00:20:43

watching them. And I am not an

00:20:45

addictive. I don't drink. I don't take

00:20:47

drugs. I am

00:20:49

>> absolutely addicted. There is no

00:20:51

question in my mind. And same with you,

00:20:53

right?

00:20:54

>> Some of it's good.

00:20:56

>> Some of it's good. And I use most of the

00:20:58

time I use I was looking at the time

00:20:59

spent. I use it for texting, like

00:21:00

bothering you, for example. But um but a

00:21:03

lot of it is addiction. And this jury is

00:21:05

going to hand you your head if you keep

00:21:08

insisting it's problematic usage. We

00:21:11

don't think you're totally at fault. I'm

00:21:13

sure this this poor girl had problems in

00:21:15

her family life, but this is a

00:21:17

contributing factor. Just like people

00:21:20

can have bad families and smoke

00:21:22

cigarettes,

00:21:24

it is it is part of of of a thing that

00:21:27

is making us worse as as as a country.

00:21:30

Um, and the same thing with Apple. They

00:21:31

should get sued. They should all get

00:21:33

sued and then we can have it out in

00:21:35

court. Same thing with the Epstein

00:21:37

victims and and the people and the

00:21:38

perpetrators. Let's have it all out in

00:21:40

court. Let's do it. Like if we lose, we

00:21:43

lose, but if we win, we win. And that to

00:21:45

me is the fairest thing.

00:21:46

>> I think we'll I think it'll start with

00:21:48

the kids. What I'm curious is if it

00:21:50

starts to

00:21:51

>> melt upwards, and that is

00:21:53

>> like cigarettes.

00:21:54

>> Well, the kids are the biggest problem,

00:21:55

right? And that's the one we're most

00:21:56

sensitive to.

00:21:58

>> That's where cigarettes started. But go

00:21:59

ahead.

00:22:00

>> I also think there's a real issue around

00:22:02

the coarsening of our discourse. I think

00:22:04

it's making us all more anxious and

00:22:06

making us all hate each other more. I

00:22:08

think I if if you type into open AI how

00:22:11

to ruin youth or how to undermine the

00:22:14

power of the United States both times

00:22:17

it'll come back with something that

00:22:18

resembles social media. There's just

00:22:21

people there's a reason and a lot of

00:22:23

it's economic that young people feel

00:22:24

worse and worse about America. But

00:22:27

social media is basically it's like when

00:22:29

you're in the third grade and two kids

00:22:31

start having words and everyone

00:22:32

surrounds them and shoves them and says

00:22:34

fight encourages them to fight. That's

00:22:37

happening a trillion times a day on

00:22:38

these platforms. It's turning even

00:22:40

amongst I spending a lot I'm thinking a

00:22:42

lot about how ways the left might [ __ ]

00:22:44

it up and lose in 26 and 28.

00:22:48

And one of those one of those ways is

00:22:50

the algorithms do a really good job of

00:22:54

convincing people who agree on 90% of

00:22:57

things to find the 10% they don't agree

00:22:59

on and figure out a way to get them

00:23:01

fighting and hating each other. You

00:23:04

know, it's just it really is ripping at

00:23:06

the fabric of society. I I I think our

00:23:09

adversaries are sitting back and

00:23:11

watching this and just loving it.

00:23:12

>> Yeah. I'm going to read from a very

00:23:14

famous author. Let me just read this.

00:23:16

All these companies began with a grozy

00:23:18

credo to change the world. But they have

00:23:20

done that in ways they did not imagine

00:23:22

by weaponizing pretty much everything

00:23:23

that could be weaponized. They have

00:23:25

mutated human connection so that

00:23:26

connecting people has often to become

00:23:28

about pitting them against one another

00:23:30

and turbocharged that discord into an

00:23:32

unprecedented and damaging volume. They

00:23:34

have weaponized social media. They have

00:23:35

weaponized the first amendment. They

00:23:37

have weaponized civil discourse and they

00:23:39

have weaponized most of all politics. I

00:23:42

wrote that in 2018. I got screamed at by

00:23:45

Facebook and the tech people for saying

00:23:46

that they were digital arms dealers.

00:23:48

That's what they are.

00:23:50

>> Have your time.

00:23:51

>> I'm just telling you it's just like

00:23:53

enough. Enough. And it begins, the

00:23:55

cigarette companies began with Joel

00:23:58

Camel, them using cartoons. They were

00:24:00

that cynical that they use cartoons to

00:24:02

attract kids to smoke. It's the same

00:24:05

thing and they need to stop. And same

00:24:08

thing, and by the way, let me not just

00:24:09

pick on Mark Zuckerberg. Apple, you need

00:24:12

to do something about CS Sam Gro, you

00:24:15

should be taken to court. Google, you

00:24:18

YouTube needs to be fixed in ways that

00:24:21

people kids don't become incredibly

00:24:23

addicted to what you're doing. And to

00:24:25

pretend otherwise just because you have

00:24:27

money, you can run over all these

00:24:29

senators and congressmen, you're not

00:24:30

going to run over all of us. That's my

00:24:32

feel. Anyway, that's enough. I'm going

00:24:33

to stop. All right, we're going to go on

00:24:34

a quick break. When we get back, Cole

00:24:36

Bayer takes on Paramount and the FCC.

00:24:40

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to get matched in minutes.

00:25:47

>> Support for this show comes from Framer.

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Rules and restrictions apply.

00:27:01

Scott, we're back. Late night host

00:27:03

Steven Cobear is calling out CBS and his

00:27:06

parent company Paramount for not

00:27:07

standing up to the bullies. Colbear

00:27:09

revealed this week that CBS lawyers told

00:27:11

him he could not air an interview with

00:27:13

Texas Democratic Senate candidate James

00:27:14

Telerico. Uh there were concerns about

00:27:17

running a foul of FCC Chairman Brandon

00:27:19

Carr, the [ __ ] as I like to call him,

00:27:21

and the FCC's equal time rule. Colobar

00:27:23

ended up posting the interview on

00:27:25

YouTube where as of this recording it

00:27:26

has nearly 7.5 million views. The

00:27:29

broadcast typically gets around 2.5

00:27:31

million viewers. This is just one single

00:27:32

interview. Coar summed up the irony on

00:27:35

his Tuesday episode. Let's listen.

00:27:39

So, we obeyed our network and put the

00:27:41

interview on YouTube where it's gotten

00:27:44

millions of views.

00:27:49

And and I I can see why. Taler Rico is

00:27:53

an interesting guy. I don't know what if

00:27:54

he should be the senator, but it was a

00:27:56

good discussion. I wish we could have

00:27:58

put it on the show where no one would

00:28:00

have watched it.

00:28:02

>> Uh CBS initially, they've been very

00:28:04

quiet lately, has been pushing back on

00:28:05

Cobar's version of events, saying the

00:28:07

show was not prohibited from airing the

00:28:08

Telerico and UNV, but was given legal

00:28:11

guidance and options. I've been in that

00:28:13

sphere. Coar took issue with that

00:28:15

statement, calling it crap, and it

00:28:16

indeed is crap. All of this has been a

00:28:19

major boost for Telerico who raised more

00:28:21

than $2.5 million uh dollars in the

00:28:23

first 24 hours after the interview went

00:28:24

on YouTube. Uh Brandon Carr, the [ __ ]

00:28:27

is calling it a hoax, by the way, saying

00:28:29

Telerico did this for the purpose of

00:28:30

raising money and getting clicks. Except

00:28:32

he then uh on this interview he did, I

00:28:35

think it was on Fox, uh said, "Oh, I

00:28:36

would have enforced it." So, he said he

00:28:38

would have done what they what what Coar

00:28:40

said he would have done. Um and then

00:28:42

also noted that this fair this this the

00:28:45

way he's in trying to thinking about

00:28:47

enforcing this equal time rule has not

00:28:50

been done in forever. So he just

00:28:52

admitted every calling it a hoax and

00:28:54

then admitted he was going to do exactly

00:28:55

what they said he was going to do.

00:28:57

Again, a [ __ ] Um and he thought this

00:29:00

is like some story like and I love Co

00:29:02

Bear I think is handling it beautifully.

00:29:04

I don't think he's being too virtue

00:29:05

signalally, but it is definitely a nail

00:29:07

in the coffin for broadcast television.

00:29:10

>> Yeah. Just to step back and try and

00:29:12

understand the real dynamics and the the

00:29:14

the shape of power here because we've

00:29:17

moved from a democracy and capitalism to

00:29:19

an autocracy and kletocracy. This is

00:29:21

what's going on. The president has made

00:29:23

it clear he will exercise his authority

00:29:26

unilaterally and illegally in my view to

00:29:29

decide who gets to acquire which

00:29:31

companies. And essentially he has

00:29:35

decided that okay um if the Ellison's

00:29:40

who own Paramount and CBS

00:29:44

fly their partisan proTrump flag, I will

00:29:48

figure out a way to get them Time

00:29:50

Warner. And so they are very sensitive

00:29:53

to trying to not offend him, plate him,

00:29:56

do whatever he wants regardless of the

00:29:58

First Amendment. And the the excuse

00:30:01

they're using is the following. The

00:30:04

FCC's equal time rule is a federal law

00:30:06

that requires broadcast stations to

00:30:08

provide equivalent air time to all

00:30:11

legally qualified candidates for the

00:30:12

same political office.

00:30:15

That theoretically makes sense, right?

00:30:18

Historically though, the FCC has

00:30:21

exempted many entertainment talk shows

00:30:24

and now they've decided to update this

00:30:26

and they're selectively enforcing it.

00:30:27

And by the way, folks, curiously, FCC

00:30:30

Chairman Carr has not yet attempted to

00:30:32

apply these rules to any conservative

00:30:36

talk shows.

00:30:37

>> He's he's sued the he's he's

00:30:38

investigating The View just on ABC for

00:30:41

having

00:30:42

>> The View and Coar,

00:30:43

>> by the way, has had Jasmine Crockett on

00:30:46

and probably asked right-wing people.

00:30:48

>> This is so ridiculous. But this is what

00:30:50

has happened. There's a decent chance

00:30:52

that FCC Chair Carr has given uh

00:30:57

Representative Taler Rico a decent shot

00:31:00

at being a senator in Texas. Now,

00:31:03

>> this has done nothing but bolster Torico

00:31:06

raised $2.5 million in the subsequent 48

00:31:09

hours. The

00:31:10

>> the big loser here is the FCC and Trump.

00:31:14

This has backfired. This is blown up in

00:31:16

their face. The Ellison, the Ellison's

00:31:19

are now now sitting on top of a

00:31:22

collapsing asset,

00:31:23

>> right?

00:31:24

>> And in addition, the other loser here,

00:31:26

just quite frankly, is Jasmine Crockett

00:31:28

>> because she she came out, unfortunately,

00:31:33

this has elevated Terico and Colbear to

00:31:36

hero status. And Crockett wishes she was

00:31:39

the one that got, you know, that got

00:31:41

sort of blacklisted, right? Cuz they

00:31:44

were running neck andneck. And the

00:31:45

likelihood according to the prediction

00:31:47

markets that

00:31:49

>> well it wasn't quite neck and neck. It

00:31:50

was like 60 40 and now pretty close I

00:31:53

think.

00:31:54

>> No no the prediction markets were he was

00:31:56

winning quite substantively but not as

00:31:58

much.

00:31:59

>> He went from 63 to 77.

00:32:02

>> Yeah. Right. That's that's

00:32:03

>> 63 is a lot. Right. That's

00:32:07

I mean that's basically when you're at

00:32:10

77 it's kind of said or it's getting to

00:32:13

the point where it looks like the race

00:32:15

may be over.

00:32:16

>> There's also early voting going on and

00:32:17

Democratic voting is alltime high. It's

00:32:20

crazy high and it's surpassing

00:32:21

Republicans. I'm going to link it

00:32:22

speaking of the Ellison's one two

00:32:24

things. Warner Brothers Discovery this

00:32:27

let me just tell you David maybe this

00:32:28

media thing isn't your best look. Warner

00:32:31

Brothers Discovery is reopening

00:32:32

negotiations with Paramount for the best

00:32:34

and final offer, but the clock is

00:32:36

ticking. Netflix has granted Warner a

00:32:37

seven-day waiver for these Paramount

00:32:39

talks. The deadline is February 23rd. Uh

00:32:41

Zazov wrote to Paramount's board that

00:32:44

David Zazov, who's the CEO, Warner, uh

00:32:46

welcomes the opportunity to see whether

00:32:47

the company can expeditiously deliver a

00:32:49

proposal that provides superior value,

00:32:51

meaning he's not calling it superior

00:32:53

value. Paramount has indicated it will

00:32:55

raise its bid to $31 a share and has

00:32:57

agreed to cover Warner's $2.5 billion

00:32:59

breakup fee owed uh to Netflix, which it

00:33:01

should have done in the first [ __ ]

00:33:02

place. A lot of these things they've

00:33:03

just agreed to, they should have done

00:33:05

months ago. Uh Netflix CE co-CEO Ted

00:33:08

Sandos explained why he agreed to this

00:33:09

in an interview with CNBC. Let's listen.

00:33:12

>> We gave them the opportunity to get

00:33:14

those shareholders exactly what they

00:33:16

deserve, which is complete clarity and

00:33:18

certainty about what the value of these

00:33:20

deals are. What we're certain is is that

00:33:22

the Netflix deal to acquire these assets

00:33:24

is the best deal creates generates the

00:33:26

best value for their shareholders and

00:33:28

they think so too. That's why they

00:33:30

recommended the deal and why they

00:33:31

reiterated recommending that deal post

00:33:33

this. So give them seven days to put

00:33:35

their money where their mouth is.

00:33:36

>> He's so smart. I got to say the other

00:33:38

part before you go in um uh they have to

00:33:42

they have to basically they have to give

00:33:43

more money. Really that's if they give

00:33:45

more money they'll probably get it. That

00:33:46

said, there's been a really, you know,

00:33:48

even though most of the narrative has

00:33:49

been anti-Netflix with Paramount has

00:33:51

done quite a bit of the making that

00:33:53

happen. Uh, this idea that they will

00:33:55

have to cut uh Paramount will be

00:33:57

disastrous because they're going to have

00:33:59

to cut because of the finances here.

00:34:01

They will they will decimate um

00:34:03

employment in Hollywood and Netflix will

00:34:05

not there both of them face different

00:34:08

challenges uh both regulatory and what's

00:34:11

going to happen. Warner Brothers has

00:34:12

scheduled the shareholder vote on the

00:34:14

Netflix deal from March 20th. Um, we'll

00:34:16

see what happens. Uh, David Ellison was

00:34:18

at the White House last week, by the

00:34:20

way. This after Trump said in an

00:34:21

interview he wasn't involved in the

00:34:22

deal. Who knows? Um, and let me link

00:34:25

this to Anderson Cooper. He's leaving 60

00:34:27

Minutes, which is a CBS property after

00:34:29

20 years. Uh, he's still at CNN, of

00:34:32

course. He signed a big deal with an $18

00:34:33

million deal with them recently. So if

00:34:36

this deal works out for parent, they

00:34:38

could take Warner's cable properties and

00:34:39

right find himself back. The reason he

00:34:42

did so was he said he was to spend time

00:34:44

with his family. He didn't want to work

00:34:45

with Barry Weiss. That I know this to be

00:34:47

true. Um he didn't like where 60 Minutes

00:34:50

was going and he he also didn't like

00:34:52

what was happening to his colleagues.

00:34:53

He's a he's a great journalist and he

00:34:56

just didn't want to work with these

00:34:57

people. So because he thinks I I would

00:35:00

assume he thinks they're lesser than and

00:35:01

and they are compared to him. So, uh,

00:35:04

another high-profile exit, not just

00:35:06

Anderson, Taylor Sheridan left, uh, who

00:35:09

does Yellowstone. Um, a lot of messes

00:35:12

there, both in the news division and

00:35:14

obviously with Coar. He's he'll be

00:35:15

leaving in May. Uh, your thoughts on on

00:35:18

these two things with the Ellisons. They

00:35:20

seem to be really, they may still win

00:35:22

it, but boy, they

00:35:23

>> First off, the way this is supposed to

00:35:25

work in a capitalist society is the

00:35:27

person who shows up with the biggest bag

00:35:29

of money gets preliminary approval by

00:35:32

the shareholders and then it goes under

00:35:34

regulatory review to make sure that

00:35:35

there's not too great a concentration of

00:35:36

power.

00:35:37

>> In my view, neither of these companies

00:35:40

should be able to acquire Warner

00:35:41

Brothers because it's too much

00:35:42

concentration of power. Having said

00:35:44

that,

00:35:45

>> this is the world we live in. One of

00:35:46

them is going to get it. What's

00:35:48

interesting is that it's clearly now

00:35:49

such a kleptocracy

00:35:52

that on Khi the likelihood that

00:35:54

Paramount takes over WBB WBD because it

00:35:57

has become obvious that the president's

00:35:59

is doing the Ellison's bidding is now

00:36:02

53% and Netflix's odds have fallen to

00:36:05

just 36%.

00:36:08

So

00:36:10

>> neck to neck on poly market just so you

00:36:12

know but

00:36:12

>> Paramount has sweetened the deal. They

00:36:14

agreed to pay $2.8 8 billion fee the WB

00:36:17

WBD would owe Netflix if the merger

00:36:20

agreement falls apart. They also added a

00:36:23

uh ticking fee of 25 cents per share

00:36:25

paid to Warner shareholders for every

00:36:27

quarter that the deal isn't closed

00:36:28

starting next year and the total cash

00:36:30

bid was raised to 78 billion back in

00:36:33

December. Here's what I don't

00:36:35

understand.

00:36:37

the union SAG After and the Writers

00:36:40

Guild decide to strike at exactly the

00:36:44

wrong moment a couple couple years ago

00:36:47

and basically took everyone had everyone

00:36:50

not work for seven months in order to

00:36:52

get nothing in exchange when they they

00:36:55

decided to strike at a weak point and

00:36:57

yet now

00:36:59

you just referenced this if the

00:37:01

Ellison's own they've already overpaid

00:37:04

for Paramount which looks to be through

00:37:06

a serious I call it a leaky yacht,

00:37:09

>> which looks to be just one after the

00:37:11

other creating self-inflicted wounds

00:37:13

that they just unforced errors, ungoals,

00:37:16

whatever you want to call it, that are

00:37:17

substantially

00:37:18

reducing the equity value and showing

00:37:21

how much they did in fact overpay.

00:37:23

Whether it's CBS News going from 5

00:37:25

million viewers to 4 million in one week

00:37:27

after the anchor transition,

00:37:30

60 Minutes might go away. I mean, these

00:37:32

things literally

00:37:33

>> Why would you stick Why would you poke

00:37:35

that in the eye? that actually was

00:37:36

successful. Oh,

00:37:38

>> so they've overpaid for Paramount.

00:37:41

They're probably going to have to

00:37:42

overpay, and I understand why the

00:37:44

rationale for Warner such they can get

00:37:46

something resembling consolidation. But

00:37:48

hey, hey, writer's guild. Hey, Saga.

00:37:51

What the [ __ ] do you think Ellison, one

00:37:55

of the largest providers of inference

00:37:58

and compute for AI, what do you think

00:38:00

their idea is going to be to rationalize

00:38:04

costs and somehow get a return on

00:38:07

investment here? What do you think is

00:38:08

going to h say what you want about Ted

00:38:10

Sarandos? He's a disciplined operator.

00:38:12

He likes the old Hollywood model.

00:38:14

>> He likes

00:38:15

>> Well, some of it some of it he likes,

00:38:16

some of it he doesn't. Yeah, but he's

00:38:18

not. Oh my god,

00:38:19

>> he's they've got the theater owners in

00:38:21

there.

00:38:21

>> Compared compared to Larry Ellison.

00:38:24

>> Agreed.

00:38:25

>> He is in love with those makeup artists

00:38:28

and those

00:38:29

>> Larry Ellison is going to leave you

00:38:31

Hollywood people naked without

00:38:33

>> He's going to say, "I have an idea.

00:38:35

>> Going to I know them. You know,

00:38:36

>> let's take let's take the 40 movie

00:38:38

release with an average budget of $140

00:38:41

million

00:38:42

>> and let's do 60 million. Let's do 60

00:38:45

movies at 14 million each using AI.

00:38:48

>> That's right.

00:38:48

>> And where do those where do those cost

00:38:50

efficiencies come from?

00:38:52

>> That's correct.

00:38:53

>> Instead of having 18 costume designers

00:38:55

on the Fantastic 5, they're going to

00:38:57

have one in an enic layer.

00:38:59

>> And by the way, it'll probably be AI

00:39:02

slop. I don't think it'll work.

00:39:07

Warner Brothers film unit

00:39:14

production cost by 40% and it's all

00:39:16

going to come out of and where the [ __ ]

00:39:18

are I can't believe the unions aren't

00:39:20

like

00:39:21

>> it's Netflix or we are not

00:39:23

>> I think you're finally right about these

00:39:25

unions. I mean I I think it's not great.

00:39:27

Listen listen the theater issue is a big

00:39:29

one but you know what consumers don't

00:39:30

like the theaters as much. Listen to

00:39:32

consumers. It's not because that tech

00:39:35

did something. They did. They gave them

00:39:37

an alternative that consumer. We all

00:39:39

have our own theater now. It's at home.

00:39:40

What they should be caring about is the

00:39:42

economic livelihood of the people

00:39:43

actually producing the content.

00:39:44

>> Correct. But the issue is the expenses.

00:39:46

Like I was just as I said I did this

00:39:48

heated rivalry interview. I mean they

00:39:49

made that show which is an enormous hit

00:39:52

for which is by the way on HBO Max uh

00:39:55

for two two million to3.5 million an

00:39:59

episode. Stranger Things 50 to60 million

00:40:02

dollars an episode. I mean, and the

00:40:04

government helped pay for it. There's no

00:40:05

way our government's gonna help pay for

00:40:07

a gay hockey love story. But that said,

00:40:10

it's the economics are changing so

00:40:12

drastically, you don't even have to use

00:40:13

AI to understand you need to change the

00:40:15

economics. And let me tell you in no

00:40:18

uncertain terms, having covered Larry

00:40:20

Ellison for 30 years, he is going to do

00:40:23

what it takes. He is has no

00:40:26

sentimentality toward anything except

00:40:28

making more money and so he will do

00:40:31

whatever it takes and that includes

00:40:33

squeezing all of you and for his for his

00:40:36

benefit and I know David loves movies

00:40:39

etc etc but at some point uh this is not

00:40:42

a romantic fantasy of saving Hollywood

00:40:44

it's not that's what kills me and here's

00:40:47

the here's the thing I don't think the I

00:40:49

think the elins have misplayed this so

00:40:50

badly they've taken too long they should

00:40:52

have done all those things they just

00:40:54

agreed to months ago uh to make it

00:40:56

better. They should have increased the

00:40:58

price if they really wanted it. They're

00:41:00

they're being very cute here and all

00:41:02

they do is attack Netflix. They are very

00:41:05

prime for attack. And then meanwhile

00:41:07

over at CBS we're getting a preview of

00:41:10

their shitty management and their shitty

00:41:12

decisions whether it's Taylor Sher

00:41:14

Taylor Sheridan which I thought was in

00:41:16

massive miss Anderson Anderson Cooper

00:41:19

who you may end up buying the Ellison's

00:41:22

man buying and being his boss he cares

00:41:25

so little for them he's willing to quit

00:41:27

60 minutes and he's going to whatever

00:41:31

happens if they get if they become his

00:41:33

boss that's how much he doesn't like

00:41:34

them. He know he they could they could

00:41:37

end up being his boss in 15 minutes.

00:41:39

That that should tell you everything

00:41:42

about it is quality people don't want to

00:41:44

be affiliated with it. So I listen I

00:41:46

agree probably this consolidation is a

00:41:49

problem and and there probably was a

00:41:51

better

00:41:53

I don't know what the better deal here.

00:41:54

I thought the spin-off was the best idea

00:41:56

for now and then later they could sell

00:41:57

the film studio. That's was my feeling.

00:42:00

That was my feeling on the whole thing.

00:42:02

Um, but this is where it's headed and

00:42:04

the Ellison's are showing you exactly

00:42:07

how they manage a property and you

00:42:09

should pay attention to it.

00:42:10

>> I for the life of me, I can't figure out

00:42:11

why the unions haven't come out and

00:42:13

said, "If Paramount gets this, we're

00:42:15

out."

00:42:16

>> Yep.

00:42:16

>> We're out.

00:42:17

>> We're good luck. Good luck managing this

00:42:19

thing. Day one, day one after this

00:42:22

closes, we're shutting the whole [ __ ]

00:42:24

thing down.

00:42:24

>> Well,

00:42:25

>> no TV production, no attention to

00:42:27

people. You know, they offered Anderson

00:42:29

Cooper a fortune to run to be the head

00:42:31

of the to be the face of 60 Minutes and

00:42:33

he even he couldn't do business with

00:42:35

them. So, I'm just saying a lot of

00:42:37

money, you know, and by the way, he

00:42:40

should spend more time with his kids,

00:42:41

but that's not what happened here.

00:42:42

Anyway, although I think it's partial.

00:42:44

I'm sure that's partial. So, anyway, uh

00:42:46

let's go on a quick break. When we come

00:42:48

back, we'll talk about the Pentagon's

00:42:50

fight with anthropic. This is something

00:42:51

else.

00:42:53

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00:45:15

Scott, we're back with more news.

00:45:17

There's so much news, it's all

00:45:18

different. The Pentagon is considering

00:45:19

cutting ties with Anthropic amid a

00:45:21

dispute over how Claude can be used by

00:45:23

the military. Anthropic wants limits on

00:45:25

uses like for weaponry that fires

00:45:26

without human input and mass uh this

00:45:30

domestic surveillance seems reasonable,

00:45:31

but the Pentagon wants access for all

00:45:33

lawful purposes. Open a Google and XA

00:45:36

have agreed to have models deployed in

00:45:37

unlawful use cases. In principle, Pete

00:45:40

Hexath is reportedly also considering

00:45:41

labeling anthropic supply chain risk

00:45:43

which could force contractors seeking to

00:45:45

work with the US military to stop using

00:45:47

claws. Senior Pentagon official said the

00:45:49

change will be a pain in the ass and the

00:45:51

Pentagon would make sure Anthropic pays

00:45:53

a price. Pete is a [ __ ] idiot. He

00:45:56

just actually let go of someone who has

00:45:57

an incredible um he forced out this

00:46:00

colonel who had this incredible record

00:46:02

cuz just cuz he's competent. Um really

00:46:06

interesting. There was just a picture

00:46:08

from I think it was India where the

00:46:09

anthropic CEO and Sam Alman wouldn't

00:46:11

hold hands for a second together which

00:46:13

was funny. They're in a big beef but

00:46:15

that's a separate beef. Um, this is

00:46:17

really interesting. I'd love to know

00:46:19

what you think about this because

00:46:20

they're not they're standing firm. It

00:46:22

looks like anthropic is like we're not

00:46:23

going to be used, you know, to attack

00:46:25

humans without a human intervention or

00:46:28

domestic surveillance, etc.

00:46:30

>> Yeah. So, the the Pentagon, they're

00:46:32

threatening to they're threatening to

00:46:34

sever its $200 million relationship with

00:46:36

Anthropic.

00:46:37

>> Not big. Not too big

00:46:39

>> because the AI firm insists on

00:46:40

maintaining limitations on how the

00:46:42

military uses their LLM. uh anthropics

00:46:45

red lines are no mass surveillance of

00:46:48

Americans and no fully autonomous

00:46:50

weaponry. Right? So,

00:46:53

but this is yet another example

00:46:57

of

00:46:59

a a loss of capitalism. This is

00:47:02

technically a very severe form of

00:47:03

socialism and that is the state has

00:47:06

decided they control the means of

00:47:08

production. private companies are

00:47:10

allowed to have their own guidelines and

00:47:12

if those guidelines mean they can't work

00:47:14

with a military contractor they they get

00:47:16

to make that decision.

00:47:18

So this is and them trying to shame them

00:47:20

and threaten them economically

00:47:22

is the worst type of socialism. So all

00:47:26

of these quoteunquote free market people

00:47:29

claiming this is private companies

00:47:34

Vox gets to decide if it doesn't want to

00:47:36

work with the Pentagon.

00:47:39

And so

00:47:41

if they sign a contract, fine, they have

00:47:43

to live up to their contract. But the

00:47:45

fact that Anthropic has these

00:47:47

guidelines, I again think this is a bit

00:47:49

of a cold bear moment for Anthropic. And

00:47:52

that is Anthropic has starts their hat

00:47:54

white in an environment where the

00:47:56

majority of Americans feel really uneasy

00:47:59

about AI. So, Anthropic has sort of

00:48:02

positioned itself as the clean, well-lit

00:48:04

corner of the bookstore here,

00:48:06

>> like Apple and privacy or Apple and not

00:48:09

>> 100%. We're the good guys.

00:48:12

>> Mhm.

00:48:13

>> And so, I I I as we sit here today, I

00:48:16

actually think that Anthropic or in the

00:48:18

next 12 months, this one of our

00:48:20

predictions is going to be worth more

00:48:21

than open AI. But this is a win for

00:48:25

anthropic and another example of the

00:48:27

government deciding they get to dictate.

00:48:31

They're not breaking the law. The

00:48:33

government gets to dictate visav laws

00:48:34

that okay, you can't discriminate based

00:48:36

on someone's sexual orientation, race,

00:48:38

ethnicity, gender, whatever. They can

00:48:40

enforce that. There's no law saying that

00:48:43

if you're a company that doesn't want to

00:48:45

engage in mass surveillance of citizens

00:48:47

that you're you have to work with the

00:48:49

government. that there this is this is

00:48:52

socialism gone arry. This is market

00:48:55

intervention where there shouldn't be

00:48:57

any. And when it comes from on Pentagon

00:48:59

stationary, I mean they might as well

00:49:01

just have had Donald Trump sign this. I

00:49:03

think this is actually going to be

00:49:05

>> it's a text will you do what I say.

00:49:08

>> It's a col bear moment. Daario Emodi is

00:49:11

being like Colar and sticking up the

00:49:13

middle finger and a lot of enterprises

00:49:15

and a lot of consumers are going to go,

00:49:16

you know, I like a company that refuses

00:49:18

to engage in mass mass surveillance of

00:49:21

its own citizens.

00:49:22

>> Yeah, I think this is a good Anyway,

00:49:23

we'll see. Pete Hag says, you're also a

00:49:25

[ __ ] Anyway, um one more quick break.

00:49:28

We'll be back for predictions.

00:49:32

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00:51:34

>> Okay, Scott, we're going to talk about

00:51:35

predictions, but first, um, I have one

00:51:38

prediction I'm going to make, but I'm

00:51:39

going want to do this first. The US

00:51:41

military is moving into place for a

00:51:43

possible Iran strike. probably because

00:51:44

this Webpstein stuff is getting hot

00:51:46

again for Trump as early as this

00:51:48

weekend. Scott, let's hear what you said

00:51:50

in January.

00:51:51

>> Bottom line is my prediction is that I

00:51:54

think we're about to see the US conduct

00:51:56

a military strike on Iran.

00:51:59

>> Now, you thought it was pretty quickly,

00:52:00

but the state uh but but it's happening

00:52:03

possibly this weekend. There's they've

00:52:04

they've amassed an enormous amount of

00:52:07

military might in the region, probably I

00:52:10

think more than when they were doing the

00:52:11

last war, they were over there. So it's

00:52:14

that this the things are in place, the

00:52:16

battleships are in place. You do you

00:52:17

want to talk about that or do you have a

00:52:18

different prediction?

00:52:19

>> Oh, no. I I think it's on and and let me

00:52:22

be clear. I like this. I would like to

00:52:24

see I think the Islamic Republic is one

00:52:28

of the most misogynistic, brutal regimes

00:52:30

in the world right now. And I think Iran

00:52:32

has the cap the potential uh to be an

00:52:35

outstanding ally. And I think if and

00:52:38

there's a lot of unknowns here. regime

00:52:40

change, you know, brings its own risk

00:52:42

>> and why he's doing it at this moment.

00:52:44

But go ahead.

00:52:45

>> But he can be doing it for the wrong

00:52:46

reasons and can still have a good

00:52:48

outcome. I'm I'm absolutely 100% in

00:52:50

favor of this. And I think that Iran uh

00:52:52

being quote unquote

00:52:55

just less oppressive, less brutal, will

00:52:57

be really good for the region and really

00:52:59

especially good for the women of Iran

00:53:01

>> if they can complete what they need to

00:53:04

complete. If they just don't and they

00:53:06

just beat them up again and then leave,

00:53:08

it's a different issue.

00:53:10

>> I think the regime the regime is hobbled

00:53:12

and I think this could tip it over. I

00:53:14

not to get in too much in the Jesus, I

00:53:15

think they need to coordinate with the

00:53:16

MSAD and have agents on the ground and

00:53:18

do a series of of targeted executions

00:53:21

quite frankly or assassinations.

00:53:23

Execution is the wrong word.

00:53:24

Assassinations.

00:53:25

But I'm a I'm a huge I'm a huge

00:53:29

proponent of this. If you look at troop

00:53:32

movements, whether it's refueling

00:53:33

planes, supply chain cargo, aircraft

00:53:35

carriers, uh, specialized operations

00:53:38

troops, they are either playing serious

00:53:40

poker or they are about to do this

00:53:43

imminently.

00:53:44

>> They kind of have to, right? And Trump's

00:53:46

probably in the mood. I think that I

00:53:47

think the other factor here is he has a

00:53:50

State of the Union on Tuesday. I think

00:53:52

he can't complete a state of the union.

00:53:53

I just

00:53:55

>> He also he also wanted to distract from

00:53:57

the Epstein files.

00:53:58

>> Epstein files. loves he loves the macho

00:54:00

flex of what happened in Venezuela. This

00:54:03

he thinks is going to be part two

00:54:05

>> which didn't last too long.

00:54:07

>> And also Rubio positions himself for

00:54:09

president with these types of actions.

00:54:11

And Rubio is probably whispering in his

00:54:13

ear this would be a great move for us.

00:54:15

Uh I I'll be very curious how our allies

00:54:18

in the region what they think of this.

00:54:20

But I I think it's on and I have think I

00:54:23

have thought if you just look if you

00:54:24

just track um uh troop movements, ship

00:54:28

movements, supply chain movements. I

00:54:31

mean we are moving a lot of stuff to the

00:54:34

region and we are sort of we are ready

00:54:36

to go. We are at the starting line.

00:54:38

>> Yeah, he'll cancel the state of the

00:54:39

union would be my guess. If this is

00:54:41

happening thought of that

00:54:42

>> um and I don't think he can complete

00:54:43

one. I don't I think he is quite losing

00:54:47

it as you know in some fashion. I'm not

00:54:49

so sure he's he's I think I know he

00:54:52

seems vibrant, but I I suspect that it's

00:54:54

there's problems around that. Um that's

00:54:56

just me. Uh one the only prediction I

00:54:59

would say is today uh Wired published a

00:55:02

story about uh the gay mafia in Silicon

00:55:04

Valley. They had written me about it and

00:55:05

I was like there's no such thing. There

00:55:07

just isn't. Sorry.

00:55:08

>> Gay mafia.

00:55:09

>> Yeah, I know. It's the it's a story that

00:55:11

they wanted to work on. They had

00:55:12

contacted me years ago about it and

00:55:13

they're like let's talk about you and

00:55:15

the game. I'm like there is no I don't

00:55:16

have friends with Kim Cook. There's no

00:55:18

gay mafia. There's I mean, sorry, but I

00:55:21

thought it was a silly idea and I still

00:55:22

think it is. And I have to say I think

00:55:24

they're going to get a lot of push back

00:55:25

for the illustration which shows uh two

00:55:28

hands coming out of two crotches, one

00:55:30

with a with a rainbow, you know, Apple

00:55:34

watch on uh but the penises are hands

00:55:36

and they're shaking. So, I thought that

00:55:39

was so [ __ ] insulting to gay people.

00:55:41

I'm sorry, guys. That was a terrible

00:55:44

illustration. Like I don't usually I

00:55:45

usually laugh at most like jokes about

00:55:47

gays, but oh my god, you don't have to

00:55:50

have, you know, penis.

00:55:51

>> Well, there's definitely no gay mafia,

00:55:52

but it's obvious that Jews run the

00:55:53

world. I mean,

00:55:54

>> right?

00:55:56

>> What the [ __ ] But why do you have penis

00:55:58

hands? We don't need penis hands.

00:56:00

>> Yeah. Just speaking along those lines,

00:56:01

George Han pointed out something that

00:56:02

really struck me as very insightful.

00:56:04

>> I think they're going to get in trouble

00:56:05

for it. That's my prediction because

00:56:06

it's stupid and it's really offensive

00:56:08

and I don't usually get offended. So

00:56:09

that's my meter. But go ahead. We

00:56:10

referenced Heated Rivalry before and he

00:56:12

said the thing he loved about Heated

00:56:13

Rivalry and it just struck me as so true

00:56:15

is that he felt it was the first time

00:56:18

>> that not one but both gay men were

00:56:20

depicted as just incredibly high

00:56:22

performance good-looking functional

00:56:26

>> like impressive men. One wasn't one

00:56:28

wasn't neurotic or quote unquote very

00:56:30

flamboyant or one wasn't struggling with

00:56:32

some they're just both really impressive

00:56:35

men and I I literally tick through every

00:56:38

depiction of gay romance and he's right

00:56:42

there's usually one person that feels

00:56:43

>> lesbians have gotten a better shake

00:56:45

recently

00:56:45

>> kagy and lacy

00:56:47

>> no lord and things like that um but yes

00:56:50

I agree with you I agree there's a great

00:56:51

book that I recommended vto Russo the

00:56:53

celluloid closet is a history of how

00:56:56

gays were depicted it uh and it it it

00:56:58

continues to this day and for gay men

00:57:00

they do not get as much complexity as

00:57:02

these two. I'd agree with you. Yep.

00:57:04

Absolutely.

00:57:05

>> Well, a certain extent the Epstein the

00:57:07

Epstein class has sort of diminished the

00:57:09

comfortable notion that gay people are

00:57:11

more inclined to be pedophiles. No, it's

00:57:13

it's rich white dudes that seem to be

00:57:14

more inclined.

00:57:16

>> Rich straight white dudes.

00:57:18

>> Yeah. And let me tell you, go straight

00:57:20

to hell for doing anyone who did that

00:57:21

should go straight to hell. Anyway, on

00:57:23

that note, um, uh, and no more penis

00:57:26

penis handshakes. Anyway, uh, we want

00:57:29

wired. I love you, Katie, but

00:57:31

>> I don't get a prediction. You're just

00:57:32

rolling right.

00:57:33

>> You just did that. No, no, go ahead. No,

00:57:35

now you have another one. Go ahead.

00:57:35

>> What was my prediction? I

00:57:37

>> military Iran.

00:57:39

>> Well, I made that one a month ago.

00:57:40

>> All right. Okay. What's your new I want

00:57:42

to say? You just I feel hurt. I feel

00:57:43

shamed. Okay, go ahead.

00:57:44

>> Okay, fine. We're bombing Iran. Never

00:57:46

mind.

00:57:46

>> No, go ahead. No. What's your

00:57:48

prediction? Well, I don't know if you've

00:57:50

noticed, but about $1 trillion

00:57:53

in value has been destroyed amongst the

00:57:55

biggest AI players since the beginning

00:57:57

of the year

00:57:58

>> as you were noting they would

00:57:59

>> and what's interesting about it is I

00:58:02

mean a few things need to happen needed

00:58:03

to happen either revenues needed to like

00:58:05

even jump more to justify the the

00:58:08

massive capex and that didn't happen. So

00:58:11

their stocks have come down. What's

00:58:13

really interesting in my opinion is that

00:58:15

what also happened though is that people

00:58:17

still think these technologies

00:58:19

um I mean just an example Amazon's off

00:58:21

14%. Microsoft's off 17%. B Apple

00:58:26

>> Apple has dropped Amazon's had its worst

00:58:28

couple weeks in a in several years.

00:58:31

>> Yeah, they've lost

00:58:33

500 billion.

00:58:35

>> They've lost a lot. Um, so but what's

00:58:38

also interesting is there's been a

00:58:39

trillion dollar wipeout at SAS companies

00:58:41

and that was when Enthropic unveiled its

00:58:44

uh Claude Co-work uh legal automation

00:58:47

tool.

00:58:48

>> It triggered uh what traders at Jeffre

00:58:51

immediately christened the SAS

00:58:53

apocalypse erasing approximately 285

00:58:56

billion in market cap in a single

00:58:57

trading day.

00:58:58

>> Software companies. Yeah. The general

00:59:00

notion is that people aren't going to

00:59:02

need that basically you're going to be

00:59:04

able to write a prompt and you'll be

00:59:05

able to replace Adobe, Salesforce,

00:59:07

Service Now.

00:59:08

>> Yeah.

00:59:09

>> And that these companies have been fat

00:59:10

and happy for 30 or 40 years.

00:59:12

>> Yeah, they have.

00:59:12

>> And these companies So

00:59:14

>> this one I agree with.

00:59:16

>> Well, it's interesting because

00:59:18

Salesforce is off 25%.

00:59:21

Uh Adobe is off 25 to 30% this year.

00:59:25

Intuitit is now down 34%. It's lost a

00:59:29

third of its value year to date. Now my

00:59:31

view and this is and this is my

00:59:34

prediction is that

00:59:36

these companies are much more deeply

00:59:40

integrated into their corporate

00:59:42

customers than people believe. And even

00:59:43

if you can write the code really

00:59:46

efficiently and quickly without their

00:59:48

technical staff at these companies,

00:59:50

their technical staff is only 10 to 20%

00:59:52

of their employees.

00:59:54

So they have they have really powerful

00:59:56

UI, they have client service, they have

00:59:58

client management, they have integrated

01:00:00

billing, they they are so deep into

01:00:03

these companies that I think rumors of

01:00:05

the death of these companies has been

01:00:06

vastly exaggerated. And as a multiple of

01:00:08

free cash flow, these companies have

01:00:11

never traded at a lower multiple. In

01:00:13

addition, if you actually look at the

01:00:16

>> opportunity is what you're saying

01:00:17

>> 100%. If you actually look at their

01:00:19

revenues and their margins, there is

01:00:22

absolutely no evidence whatsoever that

01:00:25

AI is hurting them. None whatsoever.

01:00:28

>> Yeah.

01:00:28

>> So my prediction is that a basket

01:00:32

>> a basket of stocks Adobe

01:00:35

>> Figma Service Now Salesforce that

01:00:39

they're going to have um great returns

01:00:41

from here on out. I think

01:00:42

>> especially if they integrate the AI

01:00:44

features in in a way that's helpful to

01:00:47

people, right? That's what it it I find

01:00:50

them like I what what's interesting is

01:00:53

and I think we should talk about this

01:00:54

Monday, this fight between open and I

01:00:56

just hired um a very significant person

01:00:58

from from Instagram, Charles Porch,

01:01:01

who's really talented talent relations.

01:01:03

Um Figma did a deal with Claude, you

01:01:06

know, uh Open AI got a hold of OpenClaw,

01:01:10

right? It's really interesting what's

01:01:12

happening. It starts to become what's

01:01:13

actually useful and who takes advantage

01:01:15

of the utility. Correct. And some of

01:01:18

Adobe could do it, right? They could

01:01:19

easily make their product 100 times

01:01:22

better.

01:01:22

>> Well, just looking at it operationally,

01:01:25

say they spend 10 or 20% on programming

01:01:29

and that's no longer a a moat because AI

01:01:33

can come in and write the code just as

01:01:35

easily. These companies themselves could

01:01:37

reduce their cost by 10 or 20%. Shed

01:01:40

that technical staff quite frankly and

01:01:43

then pass on those savings to their end

01:01:45

consumer while not giving up any ibita

01:01:48

or margin. In other words, 80 80% of

01:01:50

their capex goes into things that or or

01:01:53

their expenditures goes into things that

01:01:55

AI is not challenging. AI is challenging

01:01:58

their technical mode, but AI is not

01:02:00

challenging the fact that

01:02:03

my even my shitty small companies were

01:02:05

all on Salesforce. The idea of someone

01:02:08

coming in and saying, "We'll give you

01:02:10

50% we'll we'll charge you 50% less."

01:02:12

I'm like, "Are you kidding? I just spent

01:02:13

the last [ __ ] year training everyone

01:02:15

how to use Salesforce, right? We're all

01:02:17

on it." if they give me more for

01:02:19

>> and I get invited to cool Salesforce

01:02:21

events and they give me research and the

01:02:23

nice attractive dude who used to play

01:02:25

football at Cornell shows up and he's

01:02:27

our Salesforce representative. These

01:02:29

these companies are much more deeply

01:02:31

integrated

01:02:32

>> into their client base even if if

01:02:34

there's a widget on anthropic that helps

01:02:37

you build the code that they offer. It's

01:02:39

just not that

01:02:40

>> there has to be an alternative stack is

01:02:42

what you're talking about that match

01:02:44

>> well did that it what it'll do though

01:02:46

these companies are smart what it'll do

01:02:47

first off I think these companies are

01:02:49

really fat and happy and there's a lot

01:02:50

of expense cutting that they they could

01:02:52

all endure my prediction is the

01:02:53

following I think the sale or the

01:02:56

decline on uh these these companies

01:02:59

Adobe Salesforce Service Now I I think

01:03:02

it's been overdone and that a basket of

01:03:05

the companies that have endured this SAS

01:03:07

apocalypse are going to are going to do

01:03:09

really Well, I think it's a great

01:03:10

investment because if you look at their

01:03:11

multiple on free cash flow, they've

01:03:13

never been lower. They've never been

01:03:14

cheaper. And I see absolutely no

01:03:16

evidence whatsoever that AI is reducing

01:03:19

their top line or their bottom line.

01:03:20

>> Greatly exaggerated.

01:03:22

>> That's exactly right.

01:03:23

>> All right. So, anyway, that's a great

01:03:24

one. I love that one. Um, I think you're

01:03:26

right. I think you're 100% right. We

01:03:27

want to hear from you. Send us your

01:03:28

questions about business, tech, or

01:03:30

whatever's on your mind. That was useful

01:03:31

for our listeners, Scott. Thank you. Go

01:03:34

to nymag.com/pivot

01:03:35

to submit a question for the show or

01:03:37

call 85551 pivot. Elsewhere in the Karen

01:03:40

Scott Universe this week on Profy

01:03:41

Markets. Scott spoke with Professor

01:03:43

Aswath Deotin, professor of finance at

01:03:46

NYU's Stern School of Business to

01:03:48

discuss why he's concerned that the

01:03:50

market is ignoring catastrophic risks.

01:03:52

After the second world war, we put

01:03:54

together an economic order centered

01:03:56

around the US and the US dollar and

01:03:58

that's coming apart and the market seems

01:04:00

to essentially be blowing back saying it

01:04:03

doesn't matter. We're we're going to

01:04:04

figure out a way and just like we did on

01:04:07

co and maybe that's part of what's going

01:04:10

on here is people are saying markets are

01:04:11

resilient enough they're going to find a

01:04:13

way even through this dramatic change in

01:04:16

how the global economy is run to find

01:04:18

the other side. There seems to be too

01:04:21

much of an acceptance that we'll figure

01:04:22

a way through this without serious pain.

01:04:25

>> Well, that's what they're like whistling

01:04:26

past the grave. That's great. He's so

01:04:28

smart. Otherwise, is so smart. Um, we

01:04:30

obviously didn't talk about RFK Jr. and

01:04:32

Kid Rock's exercise video.

01:04:34

>> I don't know how to feel about that.

01:04:36

>> We don't know how to feel about that. I

01:04:38

feel like if I watch that and then watch

01:04:40

Heated Rivalry, I might just explode

01:04:42

into an orgy of like

01:04:43

>> They said the worst the worst season of

01:04:45

Heated Rivalry was those two. Oh my god.

01:04:48

God. rage against.

01:04:50

>> Every time I see Kid Rock, I immediately

01:04:51

think, "How much Sudafed can I buy at a

01:04:53

CVS?

01:04:56

>> There's so much good stuff on the

01:04:57

internet about it." But remember, it's

01:04:59

your taxpayer dollars at work. Oh my

01:05:01

god, there's

01:05:03

>> a milk in a hot tub. That's all I have.

01:05:04

>> That's the workout video for single dads

01:05:06

who fight for child custody and then

01:05:07

never see their kids.

01:05:09

>> Thank you. Let's end on that. Okay,

01:05:11

that's the show. Thanks for listening to

01:05:12

Pivot. Be sure to like and subscribe to

01:05:15

our YouTube channel. We'll be back next

01:05:17

week.

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