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Jeff Bezos Talks Taxes. Kara and Scott Are Not Buying It | Pivot

May 22, 2026 / 01:06:10

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I started doing it and I'm sitting there

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in the park and I'm like, do I really

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need to be an [ __ ]

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>> Not today. Yeah, tomorrow. Tomorrow.

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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 Callaway.

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>> We're going to do something a little

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different today and start with a

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voicemail from a listener who's going to

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explain the situation. Let's play a

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clip.

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>> Hi. After listening to Pivot today, I

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saw that James Murdoch is buying part of

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Box Media and I was curious how that

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might change the freedom you guys have

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on your various podcasts. Anyway, love

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your shows. Just finished burn book and

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listen to all your podcasts. Keep up the

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good work. Jenny from Texas.

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>> Oh, that's a very good question. Jenny

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from Texas. So, in case people don't

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know what she's talking about, James

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Murdoch's company, Lupa Systems, is

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acquiring Vox Media Podcast Network, New

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York Magazine, and the Vox site. Um, the

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other parts of Vox Media, including

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Eater, The Verge, SP Nation, are

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becoming a a different company, a new

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independent company. The deal is

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expected to close in the coming weeks.

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There's a few legal legalities and this

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and that. From what I understand, Lupa

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Systems has not disclosed the purchase

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price, but it's reportedly around 300

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million. the podcast network is the mo

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the more attractive asset that we love

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New York magazine and it does rather

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well um and love docs uh and so explain

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Scott people want to know what we think

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about this because a lot of people have

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bad information one first of all Jim

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Bankov is staying as CEO of this unit um

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it's a spin-off essentially uh of of

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these assets and which have been fast

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growing so explain Mr. business. Explain

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the situation.

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>> Well, about a decade ago, people

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thought, wouldn't it be great to

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aggregate kind of this alternative media

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or build alternative media companies for

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a new world? And so, Buzzfeed, Food 52,

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CNET, Vice, was it called Mike,

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Mashable,

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>> Mike? Yeah.

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>> And Vox. And back when they thought

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probably six, seven years ago that if we

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bring together sort of these good little

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media assets, some digital, some not,

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and group them together, we can spack it

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and it'll go public at 1 23 billion. And

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so Jim logically, the CEO of Vox thought

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this is a good idea. bought New York

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magazine, had a bunch of very, you know,

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fast growing websites, Eater, Verge, you

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know, Vulture, and then started some

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naent podcasts, right? And then

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essentially what happened was uh the

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market never said, okay, there was never

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the bloom came off the rose

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>> of all these companies. But basically

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they're competing against monopolies who

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extract rents and then their margin was

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you know the margin of all these

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companies is Google and Meta and

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Amazon's opportunity and they've slowly

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but surely sucked the oxygen out of the

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room and BuzzFeed from peak valuation to

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sales price was off 86% food 52 lost 96%

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of its value CNET lost 94% of its value

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was I think uh basically went bankrupt

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but sold some assets was down at least

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93% % uh Mashable off 80%. I mean just

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on and on and on and on. Tumblr, my

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favorite, 1.1 billion to 3 million. Uh

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if you're an investor in Union Square

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Ventures, thank God that the guy with

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the Caesar's haircut, I forgot his name,

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was able to convince

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probably one of the weaker CEOs in

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digital history to buy his bag of [ __ ]

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for 1.1 billion tons.

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>> That was Marissa Mayer at Yahoo.

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>> Marissa Mayor, right? So effectively

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this has just not worked out. Now what

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and what to be you know Jim our guy who

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we like has always said Scott be honest

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and always told us to be honest so let

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me be honest. They spent a lot of money

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to create a company with negative

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synergy. There's some real assets there.

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New York Magazine is a trophy iconic

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asset. Um the the sites themselves, the

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digital assets are actually do pretty

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well, but again see above they're in

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they're swimming upstream against

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giants. And then the smaller division

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that started out as an afterthought has

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become the growth engine and the crown

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jewel. And Jim is a smart guy and

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realized that the whole was less than

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the sum of its parts and basically

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decided to break them up into what was

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going to be three buckets. But my

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understanding is, and I do not have

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inside information here, and I don't

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want it, is that Jim Murdoch or James

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Murdoch, who wants to be in the media

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business, said, "I'll take New York

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Magazine because I think he likes it and

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it's an iconic asset. And what I really

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want is the podcast network, which is

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growing. I'll stop there. Where did I

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get that right?"

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>> No, you got that all right. And I think

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Jim of all of them has cannilally moved

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that into a space. Obviously, Buzzfeed

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uh just bought by Byron uh Allen. Um you

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know, they've all Vice has had a much

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less happy

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situation. I don't know where that went.

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Like there were a lot of them and it was

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very exciting. And one of the reasons I

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sold my tiny little site to Vox many

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years ago, Recode, was cuz they were

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ridiculously priced and were sort of

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pricing me at I was even a smaller

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minnow. And so when I got to Vox, um, I

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I I understood the ad market was really

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a problem here. Although we did great,

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let me just The only thing you're

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leaving out is so much great journalism

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by so many of these sites and so much

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really interesting independent media.

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Absolutely. Um, all the Verge, Eater,

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um, you know, all of them and New York

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Magazine just won a the national the

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general excellence award and the

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national magazine awards. Wonderful.

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>> It was punches above its weight class.

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It's like the HBO of magazines is the

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way I would describe it.

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>> Right. Exactly. It's amazing. Um, and

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so, uh, so anyway, so it it's it's

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really nice parts. They're really nice

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parts, but what happened was exactly

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what Scott said and what I thought,

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which is one of the reasons I went to

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Jim 12 years ago and said, I'm going to

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start this little podcast called um, uh,

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was Recode Decode at the time or might

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have been something else. I don't

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remember what it was. and cuz I really

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did have an interest in this area and

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felt it was shifting and then they added

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on the Ezra was on there. Um there's a

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whole bunch uh today explained a bunch

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of things and what essentially happened

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after that after that I met Scott

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Galloway and the rest is history like

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we've done really well

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>> bald man with the erectile dysfunction

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Murdoch it just all makes sense

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>> in Germany in the Murdoch

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>> in the Murdoch and I worked for Murd so

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rich isn't it how did this happen I know

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right I know people are thinking it's

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very funny for me especially because I

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knew James from a million years ago when

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he was actually around for digital stuff

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um very early when I was covering the

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early digital industry and he tried very

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hard to move his family's company

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digitally. But Rupert always did

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something idiotic like whether it was

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the way they handled MySpace or there

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was so many I can't even tell you. I

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just like Disney, they had 19 of these

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things and especially the iPad news

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thing that I thought was ridiculous. Um

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and so I w I we left we left the Murdoch

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Empire largely over um Rupert over

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problems. He was he was doing all sorts

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of nefarious things and we wanted to

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come out on our own. Um and then ended

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up selling to Vox and so everything

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comes around essentially. I met Scott,

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we built Pivot and we built each of our

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other stuff on and all the prof stuff

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which is wonderful. Um and over time in

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our recent renegotiation we became

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partners with Vox and they sell our

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advertising. They help us mount the

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events which they're excellent at and

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Scott has his has his has his own way of

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doing things. he just started a great

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Substack and so it's a really actually

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fertile time and but there's all these

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different configurations and I would say

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for people to understand they are we we

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I have met with uh James Murdoch and uh

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his uh wife um Katherine who is also

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very involved in this uh I have nothing

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but good feelings for them I don't have

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good feelings for his father neither

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does he um which has been well

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documented um and so we have complete

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freedom to do what we want we own these

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podcasts s that we have. Scott owns his,

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I own mine, and we own pivot together in

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a in a um in a death grip to the end for

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whoever which one of us survives. Um and

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uh and so we'll be keep doing what we

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want and we really like working with

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Jim. We and now this other gym and uh

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and the rest of it and we hope there'll

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be more, you know, synergies between

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them. We're we're not like a total

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believer in all synergy, but they've got

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some cool uh things like Art Basle and

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um a number of number film festival,

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which I'll be at uh interviewing Mark

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Maron on stage. And so there's lots of

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opportunities here, but most of the

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mostly it's not going to change from,

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you know, not going to change our deal.

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We like the deal we got. Um we again own

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our things and so uh we're happy to take

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suggestions from, you know, the same

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thing like Jim will suggest something.

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will either ignore him or will not like

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he might have a he just had a great idea

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to this morning for me. Um and I'll take

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it. Uh so and I really do think of James

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Murdock has always been very smart

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digitally. I think um uh I think I we I

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like him. He's not you can't just put

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Murdoch on it and say they suck. I I

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would agree about Rupert Murdoch. I

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would not be owned by Rupert Murdoch and

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uh and we're not owned by anyone. So I

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think that's it. Anything else? Well,

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when Reuters called me, I said, "Look,

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we like the gyms and we have, you know,

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we have a lot of power here and we

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didn't ask for anything. We just asked

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for everything to stay the same. I sell

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>> Pivot is a joint venture between

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Swisser, Galloway, and Vox. You own on I

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own PropG, but both on and PropG uses

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Vox for we do a revenue split where they

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sell our ads. And if we could have I

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mean, this is going to sound

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self-absorbed. We could have killed this

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deal. And we didn't. And we just we

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didn't ask for anything extra. We just

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said, "Yeah, we just want things to stay

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the way they are." And Jim Bangoff has

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never once

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asked me to tone it down, to stop the

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dick jokes, to reconsider.

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>> That doesn't work.

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>> No, you have. But you're you're trying

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to save me from myself, and you're also

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posing for your woke friends.

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>> Oh, stop it. You're so much woker than

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No.

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>> Anyways, I'm so much wer than you. I'm

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the woke.

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>> But let me go to just some of the the

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learnings here. And

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Basically, the business model for tech

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has been find have great technology,

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find a very compelling leadership team

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that's able to craft a narrative to

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raise more capital than anyone else,

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deliver an unbelievable product at below

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price and then consolidate the market

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and then start sucking the oxygen out of

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the entire ecosystem. So, let me give

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you an example. And then everybody else

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gets crushed. Google and Meta have been

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increasingly pushing users away from

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external sites in in favor of their AI

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overviews which they can monetize. So

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Huffpo

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between 2022 and 2025, so basically the

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last 3 years that we have data on this,

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Huffpost's organic search traffic has

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been cut in half. The Washington Post

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down by nearly half. Business Insider

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has seen their organic traffic cut in

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half. NT organic search as a as a share

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of their total traffic fell from roughly

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44% to 36.5%.

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And the Wall Street Journal's organic

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search as a as a share of their total

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traffic fell from 29% to 24%. And let me

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just go back in history and pat myself

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on the back in 2006 when I joined the

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board of the New York Times and

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literally my first meeting I said they

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said okay you're the digital guy which

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we do. I'm like shut off Google. Don't

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let them crawl your content because

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eventually they're going to commoditize

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your content,

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>> right?

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>> Stop driving traffic to us and all

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you're doing is building them into the

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ultimate toll booth.

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>> That's correct.

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>> And Martin Nenholtz, who's a very smart

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guy, said, "Well, if we can't figure out

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a way to compete against Google and

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we're making money from the traffic they

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send us, then shame on us." I'm like,

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"Yeah,

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go to go to Murdoch, go to the New

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Houses, go to the Financial Times and

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consolidate and turn off Google and then

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license your content to the highest

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bidder." And at that point, Microsoft

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had Bing and we would have been able to

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get a lot of money and say, "Look, if

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you if you want to crawl this gorgeous

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content from Thomas Freiedman and from

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Vogue and from the FT, you got to pay

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us." But instead they said no, we like

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the traffic. They were pursuing this

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eyeballs thing and now it's way too late

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and these companies are the internet and

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very few people go directly to NY the

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New York Times.com. They get served

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stuff on Meta. That's how they decide

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where they're going or the the Google is

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now entirely they don't take you to the

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best place. They take you to a place

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they can further monetize. And Jim, you

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know, Jim is managed to get on the last

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helicopter out of Saigon.

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>> Oh, wait. Do you want to hear some of

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the threads I thought of? I thought I'll

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be I'll test the limits of our new

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ownership.

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>> I was walking around Lisbon yesterday

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and it was beautiful and I was bored.

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>> So, as soon as I saw the announcement, I

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thought, I'm going to test the limits of

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my freedom. My first thread, my first

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thread was alternative media is like a

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vegan restaurant. Virtue signaling loses

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money and a billionaire bails you out.

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That was my first one. My second one was

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that that picture of Jim Brooff and

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James Murdoch where it looks like the

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30-year reunion of Abbercrombie and

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Pitch. They're both very handsome.

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>> They're very handsome.

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>> And I wrote Romeo and Michelle's high

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school reunion 2 post transition. That

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one I'm especially proud of. And

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>> oh, okay, last one. And then we

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>> What was What was my What was my third

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one? Oh god. I wrote something about Oh,

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no. It just, you know, late late stage

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capitalism. But anyways, and and then I

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started doing it and I'm sitting there

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in the park and I'm like,

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>> do I really need to be an [ __ ]

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>> Not today. Yeah, tomorrow. I'm like,

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give them their moment.

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>> Give them their moment.

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>> Give them their moment.

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>> They'll be an [ __ ] later

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>> before we start making their lives

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difficult.

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>> No, you know what? Let me let me just

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end this because we got to end this. So,

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two things. Jim B, he said, we don't we

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can say whatever we want. I don't see

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that problem from James Murdoch or

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Katherine Murdoch at all. They might be

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irritated by us, but there's no going to

00:14:20

be no change in that. And let me be I

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hate to say this, but Rubert Murdoch

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never asked me to change a thing. Like

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that is one thing I never experienced

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when I worked at the walls. I just don't

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I think he's a heinous piece of well I

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think he's heinous the way he he's done

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Fox News and the other stuff, but and

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has degraded democracy quite a bit, but

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he's not James is not him. And so, but

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but that said, and Murdoch never meddled

00:14:44

in my stuff and and he certainly could

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have um for for my entire time there. I

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just didn't like him. Um but um but one

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of the things we have to say, we we get

00:14:53

to do what we want. We will do what we

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want. And also just I know Scott was

00:14:57

sort of putting a sort of an ugly

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picture on it, but actually New York

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Magazine is uh profitable. So are the

00:15:02

pod the podcast networks are doing great

00:15:04

and very profitable. Uh a lot of these

00:15:06

websites are. So, it's not like it's

00:15:08

just not a like a it's not a crazy

00:15:11

business, but it's not these are not

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suffering properties. And last of all, a

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lot many of them most of them provide

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amazing journalism. Uh, and I I think

00:15:20

David Haskell deserves all due credit

00:15:21

for New York Magazine winning that

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award. And awards are one thing, but

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they certainly they were up against some

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amazing uh journalism this year from The

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Atlantic and from ProPublican Wired. Uh,

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so uh they're very good property. He's

00:15:33

bought some good properties here um in

00:15:35

that regard. It's not they're not

00:15:37

falling knife properties. Um, but we'll

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see what we can do. Let's see what he

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does.

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>> They make money, but the the crown

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jewel, shockingly, of all this is the

00:15:46

podcast. New York Magazine is a vanity

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asset.

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>> It is, but it does. Okay. It doesn't

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It's not It does fine.

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>> You become one of the sexiest men in

00:15:54

Soho when your rap is I own New York

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Magazine.

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>> We're going to stop there. It's a very

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It does journalism, too. Anyway,

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>> that's

00:16:02

So is NPR. It doesn't make any money.

00:16:04

it. Yeah, but this one does. So, anyway,

00:16:06

speaking of things not making money, we

00:16:08

have some IPO news to get to. First up,

00:16:11

SpaceX has filed an IPO prospectus, and

00:16:14

it is revealing the company brought in

00:16:16

$791

00:16:18

million in profit in 2024. It swung back

00:16:20

to $4.9 billion in losses in 2025. For

00:16:24

context, 200 companies in the S&P 500

00:16:26

had more revenue than SpaceX last year,

00:16:29

including Tesla. also revealed in the

00:16:31

file, by the way, they buy a lot of

00:16:32

stuff from Tesla. There's a lot of

00:16:34

roundt tripping happen at the these

00:16:36

companies. It also reve all all

00:16:37

controlled by Elon Musk. It also

00:16:40

revealed in the filing, Anthropic is

00:16:41

paying SpaceX and thank God for it,

00:16:43

$1.25 billion per month through uh May

00:16:46

2029 as part of the compute deal that

00:16:49

two signed, meaning Grock will not be

00:16:50

using that space in Colossus 1 and two.

00:16:53

SpaceX is reportedly targeting targeting

00:16:55

a $1.7 trillion valuation. I mean it

00:16:58

goes on and on and on. on a lot of these

00:17:00

a lot of words like um human I don't

00:17:04

know like connection there's AI

00:17:07

mentioned a lot just it's this business

00:17:10

is not economically and mass speaking

00:17:12

it's not worth 1.7

00:17:15

I mean it's just the Elon that that guy

00:17:17

gets a lot of uh credit for for for

00:17:20

using this number um because even the

00:17:22

stuff they're promising seems

00:17:24

problematic but he's not he hasn't done

00:17:27

it before he just moves from one lily

00:17:29

pad to the other in terms of from Tesla

00:17:31

to this. But the big the big winner in

00:17:33

this in that I read is Starlink does

00:17:36

great. The others Grock and um the

00:17:39

rocket company is not so much. Go for

00:17:42

it.

00:17:42

>> I got a lot.

00:17:44

>> Okay, good. I can't wait. I'm excited.

00:17:46

>> Yeah. What was

00:17:48

>> Spit it out, Scott.

00:17:49

>> At 3:00 a.m. I was reading the S1. What

00:17:51

were you doing?

00:17:52

>> I know you were.

00:17:53

>> First off, I have some notes here. The

00:17:54

first 14 pages of the S1

00:17:57

>> are pictures of rockets.

00:18:00

>> AI is mentioned 1,200 times in the S1.

00:18:03

There are 277 pages of the perspectives.

00:18:05

For context, it's longer than The Great

00:18:07

Gatsby and The Catch in the Rye. And

00:18:09

some direct quotes from the filing.

00:18:11

These are direct quotes. We do not want

00:18:13

humans to have the same fate as

00:18:15

dinosaurs. Well, thank God you're here,

00:18:18

Elon. For decades, a reality where

00:18:21

humanity travels between the planets and

00:18:23

the stars has felt tentalizingly close.

00:18:25

But still,

00:18:26

>> would you mind if I ate my protein bar

00:18:27

where you do this because I'm hungry and

00:18:29

I also am fascinated. Keep going.

00:18:30

>> For for decades, a reality where

00:18:32

humanity travels between the planets and

00:18:33

the stars has felt tantalizingly close,

00:18:36

but still locked in the pages and

00:18:39

screens of science fiction. The sun

00:18:41

contains approximately 99.8% 8% of the

00:18:44

solar systems energy. And as a result,

00:18:46

we believe it is the only truly scalable

00:18:49

solution to terrestrial energy

00:18:50

constraints in the age of AI.

00:18:53

Oh, Jesus [ __ ] Christ. All right,

00:18:55

hold on.

00:18:56

>> Woke.

00:18:56

>> We believe the next paradigm shift for

00:18:58

humanity is the creation of a resilient,

00:19:00

perpetually expanding, space fairing

00:19:02

civilization. Ultimately,

00:19:04

>> sexy voice, please. I mean, I need a

00:19:06

more sexy. ultimately preparing us to

00:19:08

Kardashev type 2 status defined as

00:19:11

defined in the filing itself as a

00:19:13

civilization that harnesses the full

00:19:15

energy output of the sun. Remember we

00:19:18

work its mission was to elevate the

00:19:20

world's consciousness.

00:19:21

>> Yes. No, this seems like he sounds like

00:19:22

a Mayan. He sounds like a Mayan but go

00:19:24

ahead.

00:19:25

>> So let's talk about the numbers here.

00:19:27

Headline valuation 1.8 trillion. He

00:19:29

they're whispering they can go out at

00:19:31

two. That's roughly the GDP of Canada.

00:19:35

So let that marinate. that the core

00:19:36

business is genuinely an excellent

00:19:39

business,

00:19:40

>> right?

00:19:40

>> Starlink generated 3.26 billion in

00:19:43

revenue in a single quarter with 1.2

00:19:45

billion in operating income. That's 36%

00:19:47

operating margin on a monopoly satellite

00:19:49

inner business, internet business with

00:19:51

no serious competitors in sight. It's a

00:19:53

great business. If this were the whole

00:19:55

company, it would be one of the great

00:19:57

businesses of our era. And then, but the

00:20:01

problem is it's not. Stapled to this

00:20:04

rocket ship is XAI, a business that is

00:20:07

clinically speaking a money furnace. In

00:20:11

2024, XAI lost 1.6 billion on 2.6

00:20:15

billion in revenues. By 2025, losses

00:20:17

ballooned to 6.5 billion on 3.2 billion

00:20:20

in revenue. So revenue revenue went up

00:20:24

20% but losses went up 310%. That's

00:20:27

>> Can I ask you quickly, these revenues

00:20:29

don't seem like killer? It's 30%. It's

00:20:32

not like wow. It's they're not wow

00:20:34

growth, right? Is it's sort of good

00:20:36

solid. Am I wrong there?

00:20:39

>> No, it's Well, let's just let's just

00:20:42

talk about SpaceX, the best business.

00:20:44

It's growing 20% a year and it's trying

00:20:47

to go out at 100 times revenue. When

00:20:49

Google went public, it was growing 240%

00:20:51

a year and went out at 10 times

00:20:52

revenues. So, just back to back to XAI.

00:20:57

XI is losing money on the way to losing

00:21:00

more money in in Q12 2026 alone the net

00:21:05

loss of 4.3 billion on 4.7 billion in

00:21:07

revenue total capex 10.1 billion in 90

00:21:10

days 7.8 8 billion of that uh for AI.

00:21:14

Cash on the balance sheet um cratered

00:21:17

from 25 billion to 16 billion in just 3

00:21:20

months. They burn 9 billion in cash in a

00:21:23

single quarter. That's a hund00 million

00:21:25

a day. That's not investing in the

00:21:27

future. It's it's the future billing you

00:21:30

in advance,

00:21:31

>> right? Can this anthropic thing is

00:21:32

critical. Do you think he's moving into

00:21:34

being the infrastructure player rather

00:21:36

than the AI player here? building and

00:21:39

providing infrastruure. Tim him having

00:21:40

spent too much capbacks thinking that

00:21:43

>> X AI his AI would need it and he woke up

00:21:45

and realized he didn't. It's like this

00:21:47

has happened to me a million. Every time

00:21:49

I start a company, I raise too much

00:21:51

[ __ ] money. I go get a giant office

00:21:53

base in Soho and before I know it, I'm

00:21:55

renting it out to a bunch of shitty

00:21:56

startups to try and recoup some of the

00:21:58

capital. That's what h happened here,

00:22:00

>> right?

00:22:00

>> Total debt is for that, right?

00:22:02

Presumably from the anthropic,

00:22:04

>> total debt on the balance sheet is 29

00:22:06

billion. Um, so just for context, that's

00:22:10

more debt than it's on the Delta

00:22:11

Airlines, United Airlines, and American

00:22:13

Airlines combined with all their planes

00:22:15

and and those they carry passengers.

00:22:18

SpaceX has Starship, which has cost over

00:22:21

15 billion in development and is still

00:22:22

on its 12th test mission. The bottom

00:22:25

line, you're being asked to pay 1.75

00:22:28

trillion for a great satellite internet

00:22:31

company, a rocket business that loses

00:22:33

money, an AI product losing 6 billion a

00:22:36

year and falling further behind its

00:22:38

competitors that has 29 billion in debt,

00:22:40

and a CEO who, and this is my favorite

00:22:43

part of the filing, purchased $131

00:22:46

million of his own recalled cyber trucks

00:22:50

with company cash.

00:22:52

>> Right. He's propping up Tesla. Propping

00:22:55

up Tesla. Right.

00:22:56

>> So, in some Starlink is the golden

00:22:58

goose, an amazing company. Everything

00:23:00

else is Elon's hobbies. And at this

00:23:02

valuation, you're paying full price for

00:23:06

all of them. So, you know, Snow White is

00:23:11

[ __ ] hot, but you gota if you marry

00:23:13

her, you're taking on these little

00:23:15

nonvalue ad weirdos. Uh this is so this

00:23:21

company you have an amazing company

00:23:24

buried in all of these other money

00:23:26

furnaces,

00:23:27

>> right? I like money.

00:23:28

>> He's asking you to pay essentially 100

00:23:31

times revenue.

00:23:32

>> People will so talk about that because

00:23:35

look it is not I I read it. I'm like,

00:23:37

"Wow, this is not a there's one good

00:23:39

business in there, right? Really good

00:23:41

business." And and by the way, easy to

00:23:44

disrupt that business by the people will

00:23:46

come into this business and there'll be

00:23:47

more competitors. Um and uh and so that

00:23:51

that's my worry about Starlink is like

00:23:53

sure he has the win for today. It

00:23:55

doesn't mean he will have the win

00:23:56

forever just like Tesla. Um, the second

00:23:58

thing is it will it doesn't matter

00:24:01

because people will just buy into this

00:24:03

and run it up because it's him and these

00:24:05

promises which you left out a little bit

00:24:07

here is there's going to be all these

00:24:08

robots in your home. There's going to be

00:24:10

he he made a lot of promises in this in

00:24:13

this perspectus too about the future

00:24:16

like you have to assume he's going to

00:24:18

kill it in robots and by the way I have

00:24:20

heard from many people his robot

00:24:22

technology is really advanced but it has

00:24:24

to get to people right it's got to it's

00:24:27

got to get to people it's got to become

00:24:28

a product um and so just hand it feels

00:24:32

very hand wavy this entire thing but I

00:24:34

don't think it's going to matter I mean

00:24:35

be be a Wall Street person and say you

00:24:38

know what would you do as an investor

00:24:39

faster here.

00:24:40

>> Uh you might want to play it for the

00:24:41

pop, but I actually think that there's

00:24:43

going to be a ton of bill people and

00:24:45

analysts that will look at this thing.

00:24:47

The more scrutiny on this thing, the

00:24:49

worse it's going to be for the IPO and

00:24:52

does it go out at 1.8 trillion? I

00:24:54

wouldn't be surprised if the bankers try

00:24:55

and manufacture scarcity and it gets a

00:24:58

small pop, but I think by the end of the

00:25:00

year it's well below a trillion dollars.

00:25:02

There's just no there's no way to

00:25:04

justify this thing is a cash

00:25:06

incinerator.

00:25:08

And also certain components of the

00:25:09

business feel very weiworky in the fact

00:25:11

that as they grow they burn more cash.

00:25:13

There's no operating leverage.

00:25:14

>> Yeah. Yeah. Even with even with this

00:25:16

entropic deal because that's all he can

00:25:18

sell. That's right. It's like he's

00:25:19

selling the chairs or something. Right.

00:25:22

I mean

00:25:23

>> he built out infrastructure for that he

00:25:25

doesn't need because his his AI is not

00:25:27

growing the way.

00:25:28

>> Right. Exactly. And he's got it. He's

00:25:29

got this colossus and of course he's

00:25:30

facing lawsuits all over the place

00:25:32

because he's going to buy more of these

00:25:34

methane engines. That's going to and

00:25:36

trust me that they're going to put a

00:25:37

stop to that eventually. Um, so so what

00:25:41

would you how would you do it here?

00:25:42

People are listening. What would you do

00:25:44

here?

00:25:45

>> I won't tell you what to do because I

00:25:47

have been wrong about Tesla. I thought

00:25:49

Tesla was a sell in 2017 and it's gone

00:25:51

up 8x.

00:25:52

>> No, you were right. But you were wrong

00:25:53

about what people would do.

00:25:54

>> I think we have to squarely say I was

00:25:56

wrong.

00:25:56

>> Okay.

00:25:57

>> So what I'm going to do is if someone

00:25:59

called me and no one's going to call me,

00:26:01

but if Elon Musk called me and said, "Do

00:26:02

you want allocation in the IPO?"

00:26:04

I would probably say sure and I'd sell

00:26:06

it on the first trade. They will

00:26:08

manufacture scarcity. Goldman and

00:26:11

everybody will tell him, "Okay, this is

00:26:12

what it looks like." Put out press

00:26:13

releases saying you're 30 times over

00:26:15

subscribed. It'll get a pop and then get

00:26:18

out again. An amazing business can be a

00:26:21

shitty investment even at some

00:26:24

valuation. And a shitty business can be

00:26:25

an amazing investment at a certain

00:26:28

valuation. This is an amazing business

00:26:31

surrounded by businesses that are not

00:26:33

scaling where he's trying to play

00:26:34

catchup and at a valuation that makes

00:26:37

just abso fuckingutolutely no sense.

00:26:40

>> Yeah.

00:26:40

>> So what I would do X AI in here was a

00:26:44

way to save his ass, his own ass.

00:26:46

Correct.

00:26:47

>> It's a it's it's the cheapest form of

00:26:50

capital he could find by attaching it to

00:26:52

an amazing business such that he could

00:26:54

try and catch up. And even the business,

00:26:57

even the amazing business on its own

00:27:00

which is doing 16 billion in topline

00:27:02

revenue and 8 billion in IBIDA

00:27:04

>> this is Starlink.

00:27:05

>> Yeah. I don't know give it 25 you know

00:27:10

give it a 100 times IDA it's worth 800

00:27:13

billion. 100 times I zeba is no you know

00:27:16

no one trades at that. But you not only

00:27:19

are trying to to get it out at 1 and a

00:27:22

1.7 to 2 trillion, you've attached onto

00:27:25

it all of these businesses that look to

00:27:28

have negative leverage.

00:27:30

>> Andy's using the business to help Tesla

00:27:32

out by buying shitty Cyber Trucks and

00:27:34

everything else.

00:27:34

>> Well, that was the most that was the

00:27:36

most eye popping thing.

00:27:37

>> I know. I agree.

00:27:38

>> Was that it reminded me of and this is

00:27:41

the argument against when corporate or

00:27:43

when governments decide to get start

00:27:45

cosplaying business. the the Irish

00:27:47

government or the UK government said

00:27:49

Delorean is the future and they give

00:27:50

them a bunch of loans and then these

00:27:52

pictures came out of a ton of Deloreans

00:27:55

sitting in a warehouse in Ireland

00:27:57

unsold.

00:27:58

>> So

00:28:00

the the worst product arguably the worst

00:28:03

tech product maybe than the Oculus or

00:28:06

Siri, the worst tech product of the last

00:28:08

decade is hands down the Cybert truck.

00:28:10

>> Cyber Truck. So he went out, a bunch of

00:28:12

them recalled, and he used money from

00:28:14

this organization to buy to buy back

00:28:16

Cybert trucks. You're not supposed to do

00:28:18

that. You're supposed to say, "Okay,

00:28:20

Tesla Tesla has a a a turd of a product

00:28:24

and we're going to take a right down."

00:28:25

And you just take your, you know, you

00:28:27

take your pain. This is Elon brings a

00:28:31

level of awareness, magic. People have

00:28:34

done investing with him. He is an

00:28:36

unbelievable visionary.

00:28:38

But uh you know this goes to something

00:28:40

broader and that is this is all part of

00:28:45

an entity that will cement where I

00:28:47

believe we are now and that is I finally

00:28:49

believe we are squarely in 1999.

00:28:51

>> Yeah I would agree with you. That's what

00:28:53

I felt after looking at I didn't look at

00:28:55

over as carefully but I thought oh no no

00:28:56

no this is not good. This is you know

00:28:59

all I don't really care about the

00:29:01

luminous humanity [ __ ] and flying to

00:29:03

the stars and the sun is going to power

00:29:06

our world. Like that's all his I I I've

00:29:08

had to listen that nonsense from him for

00:29:10

many years and great. I'm glad you think

00:29:13

that. I mean, I don't really care if

00:29:14

everyone if that's what turns him on.

00:29:16

That's great. But it was the the Tesla

00:29:18

thing. There was a several things in

00:29:20

here that were very speaking of

00:29:23

latestage capitalism. I felt it was late

00:29:25

Elon, right? That's what that's what it

00:29:28

felt like to me. But just we'll see.

00:29:30

>> Look, it his job is to get capital as

00:29:33

cheaply as possible. He's going to do

00:29:35

that. Yeah. I think it's smart for him

00:29:37

to do this.

00:29:38

>> That's good for him. Yeah.

00:29:39

>> But I think investors in some if you

00:29:42

look at what happened.

00:29:44

>> So there was a really interesting

00:29:45

analysis done in the FT and that is at

00:29:47

the peak of the dotcom boom about 60% of

00:29:51

GDP growth was coming from capex related

00:29:53

to telco infrastructure and the

00:29:55

internet. It's now 93% is coming from AI

00:29:59

including and I'm loosely and also these

00:30:01

companies will be grouped into that. In

00:30:02

addition, the total capex

00:30:06

inflation adjusted was about 850 billion

00:30:09

in 99 up until that point. Now we're at

00:30:12

about 1 and a.5 trillion.

00:30:14

>> And every time you have over 2 or 3% of

00:30:17

GDP going into the buildout or capex or

00:30:19

something, whether it's railroads or

00:30:21

highways or the telco infrastructure of

00:30:23

the late '9s, two years later, there's a

00:30:26

crash. Two to three years later, there's

00:30:28

a crash. Railroads, all of it.

00:30:30

>> We are there. and and one of these

00:30:32

companies or more of them is going to

00:30:34

experience what every big tech company

00:30:35

has experienced when they're get out

00:30:37

over their skis and that is you're going

00:30:40

to see a 70 to 95% decline in the value

00:30:42

of one or more of these companies.

00:30:44

Nvidia, I mean all these companies are

00:30:47

there's the the expectation

00:30:50

of they're increasing their capbacks 20%

00:30:53

a year while increasing their revenues

00:30:55

optimistically 15% a year. That's

00:30:58

negative operating leverage. And

00:31:00

eventually the music's going to stop

00:31:02

here.

00:31:02

>> Yeah, I felt drunken sailors had a feel

00:31:04

of this. I don't know. I just like

00:31:06

>> Well, the way I would describe it is I

00:31:07

think Nvidia is a casino

00:31:09

and we're all drunk people at the

00:31:11

blackjack pay table and

00:31:13

>> it will affect very good businesses and

00:31:15

then along with the tariffs and all the

00:31:17

other corruption around Trump. It just

00:31:19

gets to be a real problem here.

00:31:21

>> Nvidia is an amazing business. SpaceX is

00:31:23

an amazing business. They should, oh my

00:31:25

god, they should be worth they should be

00:31:27

worth a trillion dollars and 300 billion

00:31:29

respectively. So down about 50 to 80%.

00:31:34

And the technology I think the

00:31:37

technology will live up to its

00:31:38

expectations more on the optimistic side

00:31:40

than the pessimistic side, but the

00:31:42

valuations won't.

00:31:43

>> Yeah. All right. Well, speaking of

00:31:44

which, OpenAI is preparing to

00:31:45

confidentially file a draft of its IPO

00:31:47

perspective as soon as Friday. I expect

00:31:48

you to read it over the weekend and tell

00:31:50

me about it next week. Um, as you're

00:31:52

listening to this, the company is valued

00:31:54

at over $850 billion by private

00:31:56

investors. The things I'm looking at

00:31:58

there is all the cross investments with

00:32:00

Altman involved. I'm probably interested

00:32:02

in that. Um, where the where their where

00:32:05

the trends are in terms of their

00:32:07

subscriptions. Um, and where their spend

00:32:09

is. I think those are the things I'm I'm

00:32:12

looking at. What are you looking at

00:32:13

there very briefly? Well, just to

00:32:15

distill it, to justify the $1 trillion

00:32:17

valuation that OpenAI is pursuing at its

00:32:19

IPO, it needs to grow from 13 billion in

00:32:22

revenue to the to the size of today's

00:32:24

Microsoft in four years. So, they're

00:32:27

saying they're going to be the size of

00:32:28

Microsoft in four years. And I just

00:32:30

don't think revenue did triple to 13

00:32:32

billion, but the company burned 9

00:32:34

billion. And right now, it has negative

00:32:36

momentum relative to Anthropic. And what

00:32:39

they have said is get out right away. We

00:32:41

need the perception that we're the

00:32:43

leader. And also Sam Alman looks at

00:32:45

SpaceX and says there's not room for

00:32:49

there's only so much retail money that's

00:32:51

going to come into the ecosystem. Get

00:32:54

out because it's going to dry up because

00:32:56

if SpaceX goes out of pop and comes

00:32:59

down, retail investors are going to

00:33:01

start to get queasy and then when you

00:33:03

have these enormous IPOs,

00:33:05

in other words, at some point retail

00:33:07

investors are going to run out of money

00:33:08

to invest in these things. So he's like,

00:33:10

"Get out." And the CFO, Sarah Frier, who

00:33:12

I'm shocked still has a job because

00:33:14

she's not towing the company line. She

00:33:16

worked at Goldman and Mckenzie, has

00:33:18

reported previously that colleagues uh

00:33:21

to colleagues at OpenAI saying, "We're

00:33:23

not ready for an IPO because the risk

00:33:25

from its spending commitments."

00:33:27

>> Yeah, I know her. She's a very She's

00:33:29

like that. She's

00:33:30

>> like a Ruth Barrett. She's an adult.

00:33:31

Yeah.

00:33:31

>> The the company is committed to spending

00:33:33

600 billion over the five years across

00:33:35

vendors and their Oracle deal alone

00:33:37

requires 60 billion a year starting in

00:33:39

2027. nearly five times OpenAI's entire

00:33:41

2025 revenue.

00:33:43

>> So

00:33:43

>> again, this is we are squarely a 99

00:33:47

>> 99. All right. Well, we'll go with that.

00:33:49

All right, Scott, let's take a quick

00:33:50

break. When we come back, Jeff Bezos, so

00:33:52

good God. Speaking of billionaires

00:33:54

behaving badly, speaks out on all sorts

00:33:56

of things.

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00:35:02

>> Scott, we're back. Jeff Bezos sat down

00:35:04

for an interview with Andrew Ross

00:35:06

Sorcin, our favorite Canadian on

00:35:07

Wednesday. Let's talk about some of the

00:35:08

things he said. First up, Bezos said

00:35:10

that Trump was more mature and more

00:35:12

disciplined in his second term. The

00:35:13

Washington Post owner defended massive

00:35:15

cuts he made to the newsroom earlier

00:35:16

this year, saying he doesn't want a post

00:35:18

to be a charity. I have some things to

00:35:20

say about that because I think he's the

00:35:21

one that drove it into a wall. Bezos

00:35:23

also backed the idea of eliminating

00:35:25

income taxes for the bottom half of US

00:35:27

earners. Let's hear what he said to say

00:35:29

about his own taxes.

00:35:31

>> People sometimes say that uh that you

00:35:34

know I don't pay taxes. So true. I pay

00:35:37

billions of dollars in taxes and it's a

00:35:39

per again if people want me to pay more

00:35:42

billions, right?

00:35:43

>> Then let's have that debate. But don't

00:35:45

pretend, you know, that this that that's

00:35:47

going to solve the problem. You could

00:35:49

you could double the taxes I pay and

00:35:52

it's not going to help that teacher in

00:35:53

Queens. I promise you.

00:35:55

>> Let's try.

00:35:56

>> Let's try.

00:35:56

>> Let's try. Let's see what happens.

00:35:58

>> Let's see what happens. Jeff,

00:35:59

>> if we take his effective tax rate from

00:36:01

16 or 17% to 32 or 34 like the rest of

00:36:04

us, I don't know. Let's just give it a

00:36:06

whirl.

00:36:06

>> Let's just give it a whirl. Let's see

00:36:08

what happens.

00:36:09

>> So disingenuous in this interview. Let

00:36:11

me let me start and then I'll let you

00:36:13

go. First up, the more mature. Come on,

00:36:16

Jeff. Like seriously. Like, I get that

00:36:19

there's a lot of face work going on and

00:36:21

a lot of other enhancements, but it's

00:36:23

gone to your [ __ ] head. Like, I get

00:36:25

what he means. It's good for me. Instead

00:36:27

of saying more mature, more disciplined

00:36:29

is he's more focused on giving me the

00:36:31

[ __ ] I want. That's I I would just

00:36:33

prefer that if he wouldn't mind like

00:36:35

saying that. Whatever. He can say what

00:36:38

he wants. He's never been a particularly

00:36:40

liberal person, but now he's just he's

00:36:42

just now being just as disingenuous. The

00:36:44

Washington Post thing drove me crazy

00:36:46

because he's the one who kept the same

00:36:48

management in place then hired an

00:36:51

incompetent like Will Lewis uh did

00:36:54

nothing that the New York Times took

00:36:56

moves after Trump left office to do

00:36:58

something. He he created all manner of

00:37:01

situations where people just just left

00:37:04

cut their subscriptions which were which

00:37:06

were slightly growing but they were

00:37:08

definitely stabilizing. And then after

00:37:09

he put his dirty little fingers in the

00:37:12

editorial process, he messed it up. A

00:37:14

huge exodus of talent blaming the talent

00:37:17

which then went to successful properties

00:37:19

like the Atlantic and many other and the

00:37:21

Wall Street Journal and other places

00:37:23

which are doing okay. They're doing

00:37:25

they're they're making businesses. New

00:37:26

York Times, Wall Street Journal, The

00:37:28

Atlantic, everything else. So, every

00:37:30

time he says this, I'm like, why don't

00:37:32

you look over at Lorraine Powell Jobs,

00:37:34

who's managed to do a very nice job over

00:37:36

there at the Atlantic by not meddling

00:37:39

and supporting and not losing money. Um,

00:37:42

the income tax thing I'll let you take,

00:37:44

but it was so full of disingenuous

00:37:46

stuff. And again, let's try Jeff. Even

00:37:49

if you pay billions, you have billions

00:37:51

and you pay the fact that I pay more of

00:37:53

a percentage of my taxes than you. And

00:37:55

then the corpor Don't even get me

00:37:57

started with corporations. So anyway, uh

00:38:00

the whole thing was and also he didn't

00:38:03

look well in my opinion and since he

00:38:06

spent so much time on cosmetic stuff, I

00:38:08

feel like I can comment upon this. Go

00:38:10

ahead.

00:38:11

>> Jeff Bezos pays himself $82,000, just

00:38:14

enough such that he can claim a child

00:38:15

tax credit, which by the way he takes,

00:38:18

and then he puts all of his additional

00:38:20

money and such that the value of his

00:38:21

shares go up. He borrows against those

00:38:23

shares, not not triggering a taxable

00:38:25

event. likely has a lot of those shares

00:38:27

in a trust. And then after leveraging

00:38:29

the unbelievable infrastructure and

00:38:31

culture of the great state of

00:38:33

Washington, he then

00:38:34

>> post office everything

00:38:36

>> takes his $120 billion in shares and

00:38:39

moves to Florida to spend more time with

00:38:41

his father and then starts selling

00:38:44

shares. Now granted, just as every

00:38:48

prisoner has an obligation to escape, I

00:38:50

think every individual has an obligation

00:38:51

to avoid taxes. I don't blame him for

00:38:53

tax evasion. I blame our government for

00:38:55

letting him engage in it. But quite

00:38:58

frankly, Jeff, when you start trying to

00:39:00

wallpaper over the tax avoidance of

00:39:02

billionaires by claiming you care about

00:39:04

nurses,

00:39:04

>> teachers,

00:39:05

>> sit the [ __ ] down. Just sit down. This

00:39:09

is a misdirect.

00:39:11

And it's like when Jensen talks about,

00:39:13

"Yes, tax me more." Okay,

00:39:17

thanks guys. But I just don't think

00:39:19

they're in a position when a guy has

00:39:21

when a guy has so optimized the dynamics

00:39:25

of supply and demand of labor such that

00:39:28

his delivery drivers have to pee in

00:39:30

bottles to make their correct

00:39:31

>> quotas. You're just not the person to

00:39:34

pretend to have empathy for that nurse

00:39:36

in Queens. So, I'm not even going to

00:39:39

I'll talk about his idea, but give me

00:39:42

the mother of all eye rolls when Jeff

00:39:44

Bezos

00:39:46

claims to be concerned about the tax

00:39:48

rates of the nurse in Brooklyn. What I

00:39:53

when I've advised or when I was talking

00:39:54

to Andrew Yang when he was running for

00:39:56

president mayor, I said, "You [ __ ] up.

00:39:57

It shouldn't be universal basic income.

00:39:59

It should be basic income." And to get

00:40:01

Republicans on board, you need different

00:40:02

frame it. Don't call it universal basic

00:40:04

income because it sounds like socialism.

00:40:06

call it a negative income tax.

00:40:08

Republicans love tax breaks. I do

00:40:11

believe there's something to the notion

00:40:13

of saying anyone who makes below $50,000

00:40:17

should not only not get taxed, but maybe

00:40:19

get a tax credit in the form of services

00:40:23

or maybe just cash quite frankly because

00:40:25

most of the studies show that when you

00:40:27

create a government infrastructure to

00:40:28

deploy social programs, they're

00:40:30

inefficient and never go away.

00:40:31

>> Just give them the money. Just give them

00:40:32

>> just give them the money. Just cut them

00:40:34

a check. You're in a household, you have

00:40:36

kids, whatever. They did a bunch of

00:40:39

studies in Africa, and quite frankly,

00:40:40

I'm going to be a sexist here. When they

00:40:42

give money to the men, the prostitutes

00:40:43

in the bars do well. When they give

00:40:45

money to the women, the kids get taller

00:40:46

and fatter. You couldn't do that in

00:40:48

America and just give money to single

00:40:49

mothers, which is what I would like to

00:40:51

see happen. But if you gave just gave

00:40:53

money, nationalized healthcare, there's

00:40:55

a lot of good taxation ideas. What he

00:40:58

said was very accurate is that if you

00:41:01

had a tax holiday for people under the

00:41:02

age of 30, he didn't say this, but if

00:41:04

you gave a tax holiday, which is what

00:41:05

he's saying, or cut the taxes of people

00:41:06

making less than $75,000, you don't lose

00:41:09

that much tax revenue. Because it is

00:41:11

true that only 1%, the top 1% in New

00:41:14

York pay 48% of the taxes and the bottom

00:41:17

25% really don't pay much. So, he's

00:41:19

right they wouldn't be giving up much.

00:41:21

But he is just not. We need an

00:41:24

alternative minimum tax on people like

00:41:25

Jeff Bezos. of I believe 60%.

00:41:30

Because the earner that's making 2

00:41:32

million bucks working her ass off as a

00:41:34

baller partner at Scatterenarps in

00:41:36

Manhattan is paying 54. And fine, maybe

00:41:39

she pays maybe the person making 10

00:41:42

billion or 10 million a year pays makes

00:41:44

60%, because here's the whole objective

00:41:47

of taxation.

00:41:49

You want the least taxing tax. If you

00:41:53

start attacking education and food and

00:41:56

housing, you end up

00:41:58

>> with homelessness. Yep.

00:41:59

>> Less educated people, people who put off

00:42:01

their mammogram and die of metastatic

00:42:04

breast cancer. Those are taxes that are

00:42:06

too taxing. An alternative minimum tax

00:42:09

on corporations making above a billion

00:42:11

dollars and people say making over 3

00:42:13

million a year. They don't lose any

00:42:15

happiness. The Baso and also do away

00:42:18

with the estate tax exemption. If the

00:42:20

Bezos children inherit 20 billion

00:42:22

instead of 30, no loss in happiness. But

00:42:26

that 10 billion that could potentially

00:42:28

be divided amongst the million the

00:42:31

$10,000 to the million poorest

00:42:33

households, a lot of incremental

00:42:35

happiness.

00:42:35

>> You know what the the contrast was? His

00:42:37

ex-wife. Like she doesn't say a word.

00:42:40

She doesn't do an interview. She gives

00:42:42

money.

00:42:44

No ribbon cutings, no cosplaying, no

00:42:47

whatever weirdness you're doing to your

00:42:48

body, Jeff. uh just and doesn't lecture

00:42:51

us. That's the tone was what was crazy.

00:42:54

I I I know I got like Ben about the post

00:42:56

stuff, but all of it had this tone. The

00:42:58

post stuff was disingenuous in the

00:43:00

extreme. He's the worst media owner of

00:43:02

any media owner and it's a low [ __ ]

00:43:04

bar. Let me tell you, I take Rupert

00:43:06

Murdoch twice every day of the week and

00:43:08

twice on Sunday to Jeff Bezos. At least

00:43:10

he understands media and likes it. Um,

00:43:13

you know, this the tone was so obnoxious

00:43:18

and this is why this general, you know,

00:43:20

he talked about people demonizing

00:43:22

billionaires. Well, stop stop talking.

00:43:25

stop appearing like I I honestly it it

00:43:28

the the the damage these people are

00:43:30

doing to the brand of capitalism, brand

00:43:33

capitalism and brand AI and brand tech

00:43:36

is so vast that you can see why these

00:43:40

polls are showing up like this way. I

00:43:42

know my own sons who both are incredibly

00:43:45

hard workers

00:43:47

and it has nothing to do with me. They,

00:43:50

you know, they often don't listen to me.

00:43:52

um they don't listen to anything I do at

00:43:53

least and and I'm fine with that. But

00:43:56

they have these feelings, right? It's

00:43:59

just it I don't know. It just and then

00:44:01

it gives rise to too much demonization,

00:44:04

right? Because of the way these people

00:44:06

behave. So I don't know.

00:44:08

>> So I have stories about McKenzie Scott

00:44:11

and Melinda French Gates. I'm involved

00:44:13

in two nonprofits. I'm involved in

00:44:15

something called the Jed Foundation that

00:44:17

tries to train high schools around how

00:44:19

to identify what is kind of normal

00:44:21

strange adolescent behavior and

00:44:22

adolescent behavior that should raise

00:44:25

red flags around depression and suicide

00:44:27

and they leverage the infrastructure of

00:44:29

public schools and educate them and they

00:44:31

are they are amazing. It was started by

00:44:33

a couple that lost their son Jed. It's

00:44:34

run by this wonderful management team.

00:44:36

They do a great job. Right after I sort

00:44:39

of got involved, they called me and said

00:44:40

they did a big thing event and they got

00:44:42

they go we got great news. I'm like

00:44:43

what's that? and he goes, "We got a $10

00:44:44

million wire yesterday and we're trying

00:44:46

to figure out who it's from." Mackenzie

00:44:49

Scott

00:44:50

didn't didn't want an RFP, didn't want

00:44:52

to meet with them, didn't want her name

00:44:54

on anything. She just wired 10 million

00:44:56

bucks. And then another association I

00:44:59

love, the American Institute for Boys

00:45:01

and Men, which focuses on the struggles

00:45:02

and mental health of young men and boys,

00:45:04

run by one of my role models, Richard

00:45:07

Reeves. Melinda French Gates, $10

00:45:10

million. recognizing the majority of her

00:45:13

funds are focused on the struggles in

00:45:15

gender equality and struggles of young

00:45:16

women. But she she said without thriving

00:45:19

young men, women aren't going to

00:45:21

continue to flourish. And she just sends

00:45:24

10 million bucks. And then someone who

00:45:25

shall remain nameless contacted the firm

00:45:28

and I get it. He's trying to be or

00:45:30

contacted one of these companies and

00:45:32

said, "Can I meet with so- and so and

00:45:34

Scott? I want to hear about the

00:45:35

strategy." And I'm like, typical [ __ ]

00:45:37

rich dude. We got to go sing for our

00:45:39

supper. We got to like

00:45:42

>> go talk to him as if it's a business and

00:45:44

return on investment. Whereas these

00:45:46

these women are just like you're doing

00:45:48

good work.

00:45:49

>> Yeah. Excellent. Here you go.

00:45:50

>> Get back to work.

00:45:51

>> You don't hear from him. They definitely

00:45:53

check you out. But it's not It is It's

00:45:56

such a different way of giving. I

00:45:58

>> It really is. There's something

00:46:00

>> I couldn't dislike Jeff Bezos more after

00:46:03

this interview. I thought I honestly

00:46:04

thought

00:46:06

could have pressed him harder. Honestly,

00:46:07

I didn't think Zoro pressed him hard

00:46:09

enough on this stuff and let him get

00:46:10

away with some stuff that I wish he had.

00:46:12

But I that said, we got to see him the

00:46:15

way he is. And that is the way he is.

00:46:17

Folks,

00:46:17

>> let me make the conservative or at least

00:46:19

give some sunshine to conservative part

00:46:20

of this. I can't stand it when people on

00:46:23

the far left say Jeff Bezos didn't earn

00:46:24

his money.

00:46:25

>> Oh, he did

00:46:26

>> because he was born to a single mother

00:46:28

at the at the age when she was 17.

00:46:32

I believe he deserves to have earned

00:46:34

$120 billion. I think we deserve to

00:46:37

elect people who have the backbone to

00:46:38

tax him at 60 or 80%.

00:46:41

But don't slow him down. He's not a bad

00:46:44

person,

00:46:45

>> right?

00:46:45

>> He's doing he's doing what we all do.

00:46:47

He's optimizing for his own

00:46:48

self-interest. You may you may just you

00:46:50

may say he's more self-interested than

00:46:52

some people. Fine. We're not doing our

00:46:55

job. Elizabeth Warren and Bernie

00:46:57

Sanders, you've been in Congress for

00:46:59

[ __ ] ever and the taxes keep going

00:47:01

down under your watch.

00:47:02

>> Yeah. Let's do something.

00:47:03

>> You want to demonize them? No. Tax him.

00:47:05

>> Tax him. That's the best way like to say

00:47:07

take look you whatever you want to do.

00:47:09

Now let me switch to another billionaire

00:47:11

because this was something that

00:47:13

happened. I we have not said a lot. Our

00:47:14

listen some of our listeners are not

00:47:16

going to like what I have to say here

00:47:17

and I don't really care but I do care

00:47:19

but I don't care. Um unexpected sighting

00:47:22

in DC this week. Mark Cuban standing

00:47:24

alongside President Trump. Cuban

00:47:25

endorsed Kla Harris was a big supporter

00:47:27

in 2024. It's been one of Trump's most

00:47:30

vocal critics, but the two appeared

00:47:31

together as the Trump announced a major

00:47:34

expansion of Trump RX's administration's

00:47:37

online drugstore. The site is adding

00:47:39

more than 600 lowcost generic

00:47:41

medications through partnerships with

00:47:42

Cuban's Cost Plus Drugs, Amazon

00:47:44

Pharmacy, and Good RX. At this event,

00:47:47

Trump was asked about his new alliance

00:47:49

with Cuban. It's only on this issue,

00:47:51

just for people to be clear. Let's

00:47:53

listen. It's pretty remarkable seeing

00:47:55

you and Mark Cuban up there and the fact

00:47:57

that obviously Mark endorsed Kla Harris

00:48:00

back in 2020.

00:48:00

>> Well, he made a mistake. It was a big

00:48:02

mistake.

00:48:04

But

00:48:04

>> what does this say about what you two

00:48:06

are building here? The important

00:48:07

>> Well, it says we love people. We love

00:48:09

our country. He wants to he's got a a

00:48:11

good company and he's going to do a lot

00:48:13

of business with this and uh I'm going

00:48:15

to get drugs out through Amazon through

00:48:17

the whole group and we're going to get

00:48:18

drugs out and uh Mark wanted to be a

00:48:21

part of it and I think Mark was very

00:48:24

gracious. He said this is something that

00:48:25

really works.

00:48:26

>> Cuban later posted on X, if anyone

00:48:28

thinks I'm going to put politics ahead

00:48:29

of helping Americans reduce their cost

00:48:31

of healthcare and pharmaceuticals, they

00:48:32

are a [ __ ] idiot. He took that down

00:48:34

because he thought swearing undercut his

00:48:36

argument. He's probably right. Um, let

00:48:38

me just say a few things. The stuff out

00:48:41

there about him making a bank or he's

00:48:44

mobbing up with Trump is it's just not

00:48:46

true. You don't have to like that he

00:48:48

stood there. I get it. I get it. I get

00:48:51

it. But he this this business is to get

00:48:54

drug prices down. He does not make a ton

00:48:57

of money here. He This is more It's not

00:49:00

a charity either. He's trying to build a

00:49:02

business. But this the the stuff that's

00:49:04

out there about what he's doing is just

00:49:07

inaccurate and it's not if you don't

00:49:09

like him standing there and you think he

00:49:11

betrayed you and I saw a lot of these I

00:49:13

now can't like him. I thought he was a

00:49:15

good guy. He is a good guy. He is doing

00:49:18

something that I'm sure makes him deeply

00:49:20

uncomfortable for a very good thing

00:49:22

which is to bring lower prices. He's got

00:49:24

to get in this Trump RX. He essentially

00:49:26

took control of Trump RX in a weird way

00:49:30

because you've got to get these things.

00:49:31

If Trump is doing this site and I hate

00:49:33

that Trump's name is on it, I hate it.

00:49:36

But look, he's an ego mana who puts his

00:49:38

name on every [ __ ] thing and there's

00:49:39

nothing we can do about it. And if he he

00:49:42

sat up there with Biden, you'd love him

00:49:43

for it or whoever a Democratic

00:49:45

president, he would sit up with anyone.

00:49:48

The only thing I would say was that I'm

00:49:51

not sure he got grretched. I sent him a

00:49:53

note. I said, "You just got gretched."

00:49:55

When he when he first he started talking

00:49:57

about this this $1.776

00:50:00

trillion slush fund for people who

00:50:02

criminals who attack the capital, I

00:50:05

don't know. He got grretched. He was

00:50:06

sitting there when Trump was going on

00:50:08

about something that's obviously

00:50:11

illegal or and also a slush fund. I

00:50:13

don't know what would he should he walk

00:50:15

out? Should he leave? I don't know. He

00:50:17

did laugh at the you voted for Kla

00:50:19

Harris. I'm not sure what you do in

00:50:20

situ. Should he have sat there and said

00:50:22

I still would? I don't know. He would

00:50:24

have gotten lost out this deal. I don't

00:50:27

know. And it's not great to have to

00:50:28

stand with Trump. We get it. We get it.

00:50:30

I wouldn't do it. But if I had something

00:50:33

that mattered a lot, I might. And the

00:50:35

only other thing I would say is Zoran

00:50:38

Mandani went there and stood right next

00:50:40

to Trump and everyone praised that. And

00:50:43

I the difference was is but he didn't

00:50:45

insult Trump and he didn't like slap him

00:50:48

or do anything rude. He also didn't say

00:50:51

much and he didn't get gratched. And so

00:50:54

he he needed something for New York and

00:50:56

he got it from Trump. And so I'm not

00:50:58

quite sure what the difference here is

00:51:00

because that's what I think was

00:51:01

happening here with Mark. And you can

00:51:03

hate on me all you want saying I love

00:51:05

the billionaires, but I think what he's

00:51:07

doing is an important thing for bringing

00:51:09

drug prices online and you cannot wait

00:51:11

for 3 years to do so. Your thoughts,

00:51:13

Scott? If your emotions and political

00:51:16

partisanship trump the health of

00:51:18

Americans, then the problem is you, not

00:51:20

Mark Cuban.

00:51:21

The partnership between Trump RX and

00:51:25

Cuban's cost plus drugs will unlock

00:51:29

millions of Americans

00:51:31

in terms of cheaper prices or unlock

00:51:33

cheaper prices for millions of

00:51:35

Americans. Uh, this week's expansion

00:51:38

adds 600 generics, nearly seven times

00:51:40

the previous catalog. They'll be

00:51:43

available to anyone regardless of

00:51:44

insurance status and in many cases the

00:51:46

cash price through cost plus is actually

00:51:48

lower than what insured pay uh insured

00:51:50

people pay at the pharmacy counter after

00:51:52

co-pays. Cost plus Drugs sells the

00:51:55

cancer drug I believe it's called a

00:51:57

tanamibanib

00:52:00

for $17. The same drug runs over $2,000

00:52:03

at conventionalies.

00:52:05

three PBMs um uh Optim RX, CVS Caremark

00:52:09

and Express Scripts control roughly 80%

00:52:11

of the US drug access and are untouched

00:52:13

by this deal. It look something has to

00:52:16

change. And I respect and the US

00:52:20

government has a scale and capital that

00:52:23

no one can match. And if you have

00:52:24

something that's good for America that

00:52:25

requires that scale and that capital,

00:52:28

then you act like a [ __ ] adult.

00:52:31

I shouldn't have said [ __ ] You act

00:52:32

like an adult and you go there. So, you

00:52:36

know, you know, if if you think that

00:52:39

Mark Cuban sold out, then all right, you

00:52:44

go buy people's cancer drugs, I this I

00:52:48

can't imagine Mark enjoyed this, but

00:52:50

helping people get access to life-saving

00:52:52

drugs at a reasonable value is more

00:52:55

important than him getting dragged by a

00:52:57

bunch of bots and people virtue

00:52:59

signaling and and applying purity tests

00:53:03

from their keyboard.

00:53:04

>> Right. I would agree. You just didn't

00:53:06

have the right information. The

00:53:07

inaccuracy is what I as always

00:53:09

inaccuracy desires me. And to say that

00:53:11

that he's going to make bank at this is

00:53:13

just not true. It's just absolutely not

00:53:15

true. And and you again, I I wouldn't

00:53:18

want to have to do this. I don't know if

00:53:20

I could stand next to him, but he's

00:53:23

there for the next three years. And if

00:53:24

someone needs these drugs now, and if he

00:53:28

has to take the reputational hit, that's

00:53:30

fine. I guess that's fine. The fact that

00:53:32

you're dragging him is a pro I I

00:53:36

understand the the and I don't want to

00:53:38

in this case for the first time I

00:53:40

thought derangement. Don't be so [ __ ]

00:53:42

deranged that you don't understand what

00:53:45

Mark just did which is he had to like

00:53:47

put his like ego in a in his pocket. He

00:53:50

remains by the way Mark is not I would

00:53:53

say he's liberal or conservative. He's

00:53:55

quite it can vary all over the place,

00:53:58

but there is absolutely no way Mark

00:54:01

Cuban would vote for Trump. I at this

00:54:04

moment in time or support Trump in

00:54:07

politically. So, I don't know what you

00:54:09

want from him, but to me, I thought it

00:54:11

was just a bad a bad um look for for the

00:54:14

left. I thought I really did. I just was

00:54:16

sort of disappointed. Very disappointed.

00:54:18

So, but they're going to drag us for it.

00:54:19

So, too bad. I don't care. All right,

00:54:21

Scott. Let's go on a quick break. When

00:54:22

we come back, we'll talk about Nvidia's

00:54:24

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00:56:40

Scott, we're back with more news. Let's

00:56:42

talk about Nvidia's latest earnings. You

00:56:44

just called them a casino. The company's

00:56:45

profit for the quarter was over 58

00:56:48

billion. They're benefiting from what's

00:56:50

happening now, which is up 211%

00:56:52

from a year earlier. That is a number.

00:56:54

It's not 30%. It's a lot. 3 years ago,

00:56:56

profit was 2 billion. Nvidia projected

00:56:59

sales in the current quarter would reach

00:57:01

91 billion and it would uh as spending

00:57:05

on AI infrastructure would reach 2 to

00:57:07

three trillion in 2030. This is an

00:57:09

insane growing streak, but like you

00:57:11

said, they're benefiting from this huge

00:57:14

spend by all these other companies. Uh

00:57:17

thoughts very quickly.

00:57:18

>> Well, not a casino. They're the house.

00:57:20

>> Okay.

00:57:21

>> All of these companies spending just a

00:57:23

crazy amount of money on 1.6 trillion on

00:57:25

capex are kind of drunk gamblers is the

00:57:28

way I would describe it. And they're

00:57:29

benefiting from it. They're the house.

00:57:30

They're the house when billionaires show

00:57:33

up, sharks with who are drunk and have

00:57:36

unlimited credit at the casino. That's

00:57:37

the way I would describe it. But just in

00:57:39

terms of the earnings, the revenue was

00:57:41

81 billion, up 85% year-on-year, which

00:57:44

was a beat. Earnings per share was a

00:57:46

beat. Data center revenue 75 billion, up

00:57:48

92% as you said, year-on-year accounting

00:57:50

for 92% of total revenue. Again, a beat.

00:57:53

Their Q2 guidance 91 billion above the

00:57:55

86 billion expectations. Another beat.

00:57:58

And their shareholder returns dividend

00:58:00

was raised 25x from 1 cent to 25 cents

00:58:03

per share. 80 billion in new buybacks

00:58:05

authorized. And I mean the reason he's

00:58:08

on that plane to China is there's no

00:58:10

shipments right now and he he's like he

00:58:12

looks at the stock price and thinks I

00:58:14

have got to continue to be

00:58:15

>> continue.

00:58:16

>> Yeah. And the only thing that's I found

00:58:18

really interesting here was despite

00:58:19

beating on every every conceivable

00:58:22

metric, the stock was flat, which says

00:58:26

to me that so the expectations of the

00:58:28

stock price are so enormous now that

00:58:32

they don't they people don't expect

00:58:34

Nvidia to beat, they expect them to

00:58:35

massively beat, which says to me that

00:58:37

the first time Nvidia even whispers

00:58:39

things might be slowing down, it it

00:58:42

craters. So unbelievable company, 15th

00:58:46

beat in a row, but I just think so the

00:58:49

expectations that are built into this

00:58:51

valuation. I think it's the most

00:58:52

valuable company in the world now.

00:58:54

>> Yeah.

00:58:55

>> Um are pretty significant as evidenced

00:58:57

by the fact that it beat on every

00:58:58

conceivable metric and the stock didn't

00:59:00

move.

00:59:01

>> Right. Right. That's interesting. That's

00:59:03

a really good point. Anyway, we'll see.

00:59:05

We'll see what happens. There's a lot.

00:59:06

It's it's precarious

00:59:09

is what I fragile.

00:59:10

>> By the way, stocks off 2% today.

00:59:11

>> Yeah. But let me see a lot. Several

00:59:12

different Wall Street people call me in.

00:59:14

They said, "Everything feels so

00:59:16

fragile." So, we'll see. All right,

00:59:18

Scott. One more uh quick break. We'll be

00:59:20

back for predictions.

00:59:22

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01:00:56

Okay, Scott, bring your predictions in a

01:00:57

second. I just want to note we're going

01:00:58

to be off on Memorial Day uh for

01:01:00

Tuesday. would not be we'll be taping a

01:01:02

show on Memorial Day for Tuesday.

01:01:04

>> All right. Oh, I'm sorry. Um, so I have

01:01:07

one

01:01:09

we talked about late state or 99, but I

01:01:12

I'm I'm going to I just can't help it. I

01:01:15

don't think SpaceX is going to price

01:01:17

near $2 trillion.

01:01:19

>> Okay.

01:01:19

>> The financial suggest

01:01:20

>> I think you're going for it.

01:01:22

>> Well, you're going to have so many

01:01:24

people pouring over this S1 and it's

01:01:28

just pretty ugly. You just read this

01:01:30

thing and you start thinking, okay, this

01:01:33

feels

01:01:34

this feels a little bit, you know,

01:01:37

Iawasa. It just it it's a lot. And if

01:01:41

and if you take each of the three

01:01:42

business lines, space, connectivity and

01:01:44

AI, and apply a comparable price to

01:01:47

sales multiple to each, Rocket Lab for

01:01:49

space, VSAT for connectivity, and

01:01:52

anthropic for AI, which are very

01:01:54

generous, you know, health healthy

01:01:57

valuations and you add them up, you end

01:01:59

up with a valuation of 547 billion. My

01:02:03

my hero on this stuff, Asat Motorin,

01:02:06

valued the thing at 1.1 trillion. And if

01:02:08

you double each of those price to sales

01:02:10

multiples,

01:02:12

um, you assume that each business will

01:02:13

command a valuation that is two times

01:02:15

the typical market rate, you are still

01:02:17

about $750 billion away from SpaceX's

01:02:20

projected valuation.

01:02:21

>> Yeah.

01:02:22

>> So

01:02:22

>> that's being kind. You're saying that's

01:02:24

being

01:02:25

>> if you just get very aggressive and

01:02:26

value every piece of this as a leader in

01:02:28

its respective field

01:02:29

>> and add the Elon plus,

01:02:31

>> you add you get 600 billion and then you

01:02:33

go, okay, Elon effect, double it, 1.2

01:02:36

trillion. So, I've I've always been

01:02:38

wrong around Elon, but I'm saying I

01:02:40

think it's going to I think two China is

01:02:41

a real stretch for here and it's going

01:02:42

to price below that.

01:02:43

>> All right.

01:02:44

>> And then the other one is just boring

01:02:45

one. There's I think you can expect a

01:02:47

deal between the US and Cuba in the

01:02:49

coming months.

01:02:50

>> Cuba is currently in a fullblown crisis.

01:02:53

I absolutely think the smartest thing we

01:02:55

could do is be providing humanitarian

01:02:56

aid and let people decide that they want

01:02:58

to be the 51st state or at least get

01:03:00

along with us.

01:03:01

>> Yeah, I agree.

01:03:01

>> The collapse is comparable. Well, it's

01:03:03

not getting any news because of

01:03:04

everything else going on. But the

01:03:05

collapse is literally comparable to the

01:03:06

1990s crash that followed the fall of

01:03:08

the Soviet Union.

01:03:09

>> Yep.

01:03:09

>> Between December of 2025 and April of uh

01:03:12

26, Cube received just one of the eight

01:03:14

monthly fuel shipments its economies

01:03:16

required requires to function.

01:03:18

>> And blackouts are now, get this, 20

01:03:21

hours a day.

01:03:22

>> I mean, it's crazy. No, we should just

01:03:24

help them

01:03:25

>> 100%.

01:03:26

>> part of the world again. And uh and but

01:03:29

there's going to be a deal here because

01:03:31

Rubio is reportedly having secret talks

01:03:34

with Ral Castro's grandson, bypassing

01:03:36

official Cuban channels. Trump told

01:03:39

reporters in February, Cuba wants to

01:03:40

make a deal. Just yesterday, Rubio sent

01:03:43

video message to the Cuban people,

01:03:44

proposing 100 million in aid, and

01:03:45

blaming Cuba's leaders for shortages of

01:03:47

electricity, food, and fuel. Uh Rubio

01:03:50

was born to two Cuban immigrants, and

01:03:51

this is a deal that he has personal

01:03:53

investment in. He sees this as his run,

01:03:55

his next

01:03:55

>> his

01:03:57

president.

01:03:58

>> All the people

01:03:59

>> sets him up well for a 2028 run. Cuba is

01:04:02

in a deep dark corner. And also Trump,

01:04:05

he doesn't want another military

01:04:06

excursion. There's just there's no

01:04:08

[ __ ] way.

01:04:08

>> There's a way to do this. Just let it

01:04:10

fall apart and we come in and help pick

01:04:11

up the pieces.

01:04:12

>> It's already Well, it's falling apart,

01:04:13

>> right? You know what I mean? It's like,

01:04:15

you know, interestingly, I agree with

01:04:17

you here because I do think it should be

01:04:18

welcomed back into the nations. It's

01:04:21

I've always wanted to go there. You

01:04:22

know, my my actually everyone in my

01:04:25

family has been there but me, which is

01:04:26

interesting.

01:04:26

>> I've been there. It's great.

01:04:27

>> Yeah. That's I just feel like it's it's

01:04:30

a wonderful people and it'll help Rubio

01:04:32

immeasurably. This is at the heart of

01:04:34

his presidential camp. You understand

01:04:35

that? Like it's very clear for at least

01:04:37

for Florida. Um and uh and one of the

01:04:40

things that speaking of collapse, I've

01:04:42

heard from so many foreign affairs

01:04:45

people who I really trust and think are

01:04:48

smart that Russia is very in much

01:04:52

distress. Putin is under much stress

01:04:54

right now because of the situation in

01:04:57

that that in Ukraine, the economy,

01:04:59

everything else. And that they had

01:05:02

thought this is the first time they see

01:05:03

a light at the end of the tunnel,

01:05:04

Putin's rule. Just saying that. Just

01:05:07

putting that out there which was

01:05:08

interesting and

01:05:09

>> I gonna say it as a lie at the end of I

01:05:10

think the end is nigh.

01:05:12

>> The end is nigh. Yes. Whatever. Anyway,

01:05:14

so it's just interesting and we should

01:05:15

do this you know there let me let me

01:05:18

quote that more on Brendan Carr. We can

01:05:20

do this the easy the hard way or the

01:05:22

easy way. Let's do it the easy way with

01:05:23

the Cubans, right? Let's show them the

01:05:26

bigness of the United States and really

01:05:28

help them. And then Scott and I will

01:05:30

open our hotel there and retire.

01:05:33

Okay. Uh okay.

01:05:35

>> Great mojito. Great,

01:05:36

>> great cigars, everything else. Uh, in

01:05:38

any case, we want to hear from you. Send

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01:05:50

Thanks for listening to Pivot. Be sure

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