hey everybody hey everybody before we

drop this week's amazing episode just

some quick information for you saak and

chamoff both had the week off so we had

two Amazing Friends of the pod on Gavin

Baker from at trees and Joe Lonsdale

from 8 VC what a treat to have them on

the program but there is some big news

huh freeberg yeah well the news dropped

after we recorded so it's not going to

be referenced and the show might feel a

little stale but here we go our friend

David Sachs is the White House Ai and

cryptar of the United States of America

congratulations to our boy amazing super

thrilled that is a big reason why he

wasn't able to join us for the show he

was in the middle of getting this news

ramped up yes it came out we had already

recorded yeah take that into account as

we go into the show yes and uh according

to Trump's truth social post saxell

quote guide policy for the

administration in artificial

intelligence and cryptocurrency he will

also lead the presidential Council of

advisers for science and Technology huh

how great is that freir wow science

Corner in the White House can't wait

it's going to be fun ex pretty awesome I

have no announcements uh the rumors

about me becoming press secretary are

obviously premature but if ask to serve

I will serve my country okay let's get

to it don't worry besties all in isn't

going anywhere we'll be here every week

for you except maybe Thanksgiving or a

holiday now and again all right let's

start the show huh free bar great

episode let's go all right everybody

Welcome to the all in podcast I am your

host Jason calacanis how you doing

freedberg I'm hanging in there I'm

waiting for the tsunami to hit it's

gonna we're about 40 minutes away I'm a

little anxious right now more anxious

than normal is what you're saying like

on a scale of one to freeberg this is

like as anxious as you get with this

tsunami I don't know what's gonna happen

this current warning shows a 5 foot

water rise or 5 meter I can't tell God I

really hope we don't this episode and

there's like a total

disaster it we're not going to make

light of it it we get warnings once in a

while just to give everybody a little

perspective here I'm at David Sax's

house I've taken over as you can see I

got my Monclair hat on

freeberg I uh I found Sax's robe see

this year it was Sax's robe but I got a

red Sharpie and I just crossed it out

and I put Jal on it and then I I went

down and I was talking to Chef does sax

know that you're staying at his house he

knows I'm staying here but does he

though he doesn't know that I found the

actual

cavar let your winners

[Music]

ride we open source it to the fans and

they've just gone crazy

[Music]

with with us today chamath couldn't make

it this week and had surgery and now he

looks like Gavin okay yes yeah

and saaks is taking a day off he's he's

he's got the day off today I think he's

just winning too much with us two

substitutes to jump in here for the team

cackling you can hear uh the cackling

Joe Lan there's Joe lale take my mon

Clair hat off here

J I'm also winning too much but I'm

happy to be here last minute as a as a

sub for David J J Joe lale for people

who don't know is to the right of David

saaks he is venture capitalist and he

started a couple of companies you might

have heard of them paler I what are the

other Greatest Hits adapar adapar just

across trillion dollars reported on it

this month it's a good real company too

yeah open go sold this year we we saw

start of a bunch of Cong good yeah um

Joe uh gets he's you're a little bit

lower profile than all these

accomplishments it's pretty incredible

co-founded how many billion dollar

companies have you co-founded now I

don't know maybe six or so six or so uh

also with us Gavin Aker from a treaties

he is a hedge fund manager he does

Private he does public one of the

smartest guys I know great analyst

welcome to the program Gavin friend of

the Pod thank you Jay Cal happy to be

here great to see everybody yeah we are

experiencing a huge Trump bump the

election is over the cabinet is being

assembled and we're seeing do the

department of government

efficiency as well as maybe regulations

being pulled down and and we'll we'll

get to to our first topic about our new

SEC chair but just generally speaking

aan as a market participant for a living

what's your take on what we've seen over

the last three weeks since the election

results came in so if they execute

unstated plans

and there are some of the world's

greatest execution machines involved um

you know Elon generally does what he

says he is going to do MH

um like I this is going to be awesome

for America for markets for the world

and the analogy I keep coming back to is

Sai Nella taking over a CEO of Microsoft

Microsoft was a monopoly incredibly

advantaged it had just been horribly

mismanaged for years all he had to do to

start winning was stop doing really

really dumb

things and that's an incredible place to

be you know America like we're the

greatest country country you know we've

got you know oceans on two sides

peaceful neighbors incredible natural

resources you know completely you know

can produce our our own food and energy

like in many ways most privileged

country on Earth but sometimes with

great privilege comes great like

stupidity and California to me would be

a leading example of that most in many

ways most privileged state in America

and a predator away with bad

policies and I do think one thing that

everyone of all political Stripes agrees

on is there are too many regulations

that result in far too many

administrators far too much complexity

and an inability to build things in

America so you know it was used very

effectively and as it should have been

against the Harris Administration that

they'd approved $42 billion for Rural

Broadband hadn't built anything had

approved $40 billion for Ev charges or

whatever it was hadn't done anything and

it's not that they didn't want to you

know dig trenches and do Broadband they

didn't want to make EV Chargers their

own regulations prevented them so I just

think

deregulation and

simplifying regulations and the tax code

is going to lead to an immense amount of

growth which is something that all

Americans should be happy about Joe you

want to maybe give us your take I know

obviously you're very vocal you're

obviously a conservative run a think

tank and have strong feelings on all

this but there is consensus I think

amongst all Americans that we don't like

fraud waste abuse and those items those

seem to be consensus building uh

efficiency and paying low lower taxes

all of that seems like something almost

all Americans most Americans can get

behind so I guess maybe a little bit of

your take on what we've seen in the

markets and the plan and then also are

you going to be involved in this at

all well listen listen J I think I do

agree I think almost all reasonable

Americans can see that our growth is

ridiculously constrained and I think

Jeff Bezos was saying yesterday like we

need a growth oriented mindset if we're

g to get out of our debt problems out of

our deficit problems so it's nice to see

everyone kind of coming on the team and

saying yeah we need to fix these things

I think what people don't understand is

like just how broken the government

bureaucracy bureaucracies and

regulations are right it's not like

they're kind of sort of bad like it's

it's almost like they're companies that

went bankrupt like think of the worst

company you know Silicon Valley they

went bankrupt like 30 years ago and

imagine if someone just like kept

pumping money into that worst company

you know over like 30 years to keep

hiring people so like Yahoo or AOL like

some Legacy

company was failing it take the worst

Department there and then like the worst

Department gets the most money so it's

like it's like it's it's like more I

guess you can use the word now

it's more than anything you've

seen in a long time and and I think one

of the important things is America used

to have these really hard test for 100

years you know this in 1883 we said you

know what we shouldn't just hire our

friends if someone's going to run

something in government let's have these

tough tests kind of like China China did

for thousands of years and and and for a

hundred years we had really hard test if

when we went to the moon when we fought

the world wars you know we did them

inhan project the people making those

decisions and hiring people had to pass

things that really only like five 10% of

people could pass who took them and then

in the late 70s we said not only are

these tests racist so we can't test

people anymore of any background we also

can't fire people anymore because we're

going to give them tons of protections

so for and so the last 40 years it just

got dumber and then 10 years ago you

started doing all the virtue signaling

and and you know hiring based on your

identity versus based on anything else

so so it's got even worse and so now

it's so broken that yes we're letting

tens of billions of dollars on Fire And

so there's really two things here one

you got to take a chainsaw as Elona said

you got to take a chainsaw and just like

cut a ton of broken stuff but then day

two is you got to say how do we make

this not stupid in the future and

there's things like maybe you bring back

tests maybe you bring accountability

thing I the thing I'm most passionate

about is you know right now there's over

a million rules to the federal level

it's stuff that everyone disagrees on

you can be the most left person trying

to build like solar or wind or whatever

and you're like what I have to do what

study over how many years this makes no

sense so so we gota we gotta we gotta

take these regulations and not only cut

them but we got to make a data driven

system that forces regulations to defend

themselves and that way instead of

having a cancer that just grows forever

out of control you could actually have a

process that like naturally things

naturally makes things fight for himself

and that that way doesn't get as dumb

ever again I would why not just make

them automatically sunsetting after five

years if they're not renewed exactly but

make the process to renew them difficult

and data driven exactly so they yeah

yeah exactly so if you renewing them

will take so much time that it will slow

it down I wonder where we got to the

place freedberg I will bring you in on

this since really I think it was maybe

two or three years ago you started to

point out exactly the death spir going

to get in I want to give you a flowers

here on the Pod because from this pod

and your obsession uh and you're harping

on and on about this national debt

problem you saw it early you talked

about it constantly you brought a lot of

consensus on board and now we're seeing

it as the issue of the transition is the

debt and we were sitting here for the

past year or two saying when are

politicians going to even pay attention

to this and now they are paying

attention to it so first here's your

virtual flowers

how are you feeling about the transition

to date well I mean I think first of all

there's like three layers of the problem

which I've been trying to Har on for

almost four years number one is the

inefficiency and lack of accountability

which Joe and Gavin are obviously

talking about and that leads to

excessive spending and that leads to the

debt problem and the debt problem

creates this kind of arithmetic debt

death spiral which is um something you

don't want to find yourself in so that's

the inevitability that I've been kind of

really worried about and I think that

you know look there's uh the first

derivative and second derivative can

kind of get addressed and then hopefully

you don't get to the absolute point

where you have this breaking breaking

point I I think right now everyone's

banking number one on can we deregulate

in a way that can unlock growth and by

unlocking growth the right the the the

the kind of arithmetic argument is grow

GDP because you're not going to be able

to shrink debt super fast uh in order to

grow GDP there there needs to be some

unleashing happening and so if you can

get GDP to grow four five

% and you can minimize the excess

spending meaning you can minimize the

deficit the federal deficit and

therefore minimize the increment in in

the debt level the debt to GDP ratio

becomes more manageable because

ultimately you can only tax so much of

GDP so yeah I feel like this is

important in both senses one is just cut

the inefficient wasteful spending get

rid of the regulations and that'll

unleash the necessary growth one of the

proxies I Look to and I I think that

this is going to be kind of

the critical motivating factor for the

United States whether it's this

Administration or the next or on a

continuous basis there's going to be

this kind of moment where we're going to

look across the water at what China has

and you can see what China's getting

what China is making what China is doing

I've talked about this a lot as well and

I do think this is the most critical

metric that no one talks about as much

as I think we should which is the

increment in electricity production

capacity in China compared to the United

States and so we are going from one

terawatt to two terawatts they're going

from I think two to eight over the same

time period and they're doing so

important for the people who are

listening who think you're saying I'll

let Joe I'll let Joe answer that Joe go

ahead just unpack it for the audience I

mean I obviously understand why this is

important but I want you to the number

one thing I'd say is it's usually

correlated to how well the working class

is doing in your country to per capita

GDP to cost of goods I mean obviously I

care about it because we want to scale

AI for all the things we're doing and we

want to be able to do it effectively but

if you just look over time it's really

clear the relationship between how well

is your average working middle class

person doing and their their quality of

life their cost of life and the cost of

electricity and cost of power and it's

it's crazy we're not just like ramping

up and cutting things to do this more

electricity means more automation means

more AI means more things are being done

for the for every person that are being

done in factories or being done by

machines and that

unlocks um a new kind of level of living

and that's been kind of a continuous

process for humans there's this guy that

writes these books that Bill Gates

always talks about V Smith smear name SM

SM he's got all these books on the

history of the relationship between

energy and kind of prosperity there's

definitely correlation there and there's

definitely causation there Gavin and I

there's even like really simple ones I

don't know if you've ever seen Lewan Yu

from you know the founder of Singapore

essentially talk about just how air

conditioning change the country's fate

it raises average IQ by two or three

points it really matters but look I

meend day at the end of the day my my

key point was we have to make sure that

this Administration and Joe can hear me

on this and I know he he believes this

but for me it has to be such a priority

that we um accelerate a nuclear uh

energy roll out in the United States

because that's what China's doing they

have dozens of Gen 4 reactors that are

going to get built built out Each of

which has a gwatt of production capacity

and they're doing it at a cost that we

can't compete with today but

fundamentally they can do it in the US

we can't even do it and regulations it

goes back to Joe yeah and so so regul

the regulatory structure prohibits our

ability to actually expand energy

capacity or electricity production

capacity which is a critical difference

and that ultimately leads to a situation

where in 10 years we're going to be

looking across the water at you know a

competitive country that has 3x 4X the

electricity production capacity of our

country and everything is cheaper

everything is faster it gives them

superiority in a lot of functions that

we can't this this is a key national

security thing too because we need

manufacturing here to be affordable and

competitive in order to for National

Security you know David when you when

you texted me last minute to join this I

was actually in a meeting with our

friend from Founders fund who's building

nuclear fuel again for the first time in

the US that's actually gone away too and

so so that needs to be approved but you

know I know Chris Wright he's a nominee

for the new you know energy a Secretary

of Energy and he you know he's super pro

Liberty guy but super pro cheap cheap

energy guy and he's Pro Nuclear So I

think we have some really great people

who care about this we're gonna be

fighting hard for it what's what's your

read on it yeah what's your read on

energy and the blockers yeah I mean more

nuclear more better like I

mean I agree with everything Joe said

and the only thing I would just add is

it is the most environmentally friendly

kind of energy source some way it's even

more like I I think think it is highly

likely that in my lifetime the world

just runs on solar like if you just you

know we all know compound interest is

the greatest force on Earth but if you

just look at the rate at which

photovoltaic cell efficiency is

compounding battery efficiency is

compounding and people make these

balance of system

arguments but it it it will it will

never be as cheap as nuclear but it will

likely approach coal and I think a lot

of the world will run on solar but

that's going to take 50 years um nuclear

is arguably just as environmentally

friendly done right and carefully and it

is here now and so I

just yeah I mean that's yeah I I don't

want I it is unbelievable to watch not

exactly Mor's law but this precipitative

drop in the cost of just solar panels

solar solar's very solar's very

impressive but in some ways to me it's a

little dystopian to think about all

these forests just covered with this

stuff I it's rate limiting it's rate

limitting you have you have to have many

many acres rolled out and with nuclear

you can have a building that can you

know power the equivalent of many acres

so the answer's both the answer is both

but it is like Elon has tweeted many

times about the tiny

fraction of you know deserted um desert

areas of America that need to be covered

with panels and then you put in

batteries there's still a space limiting

like let's just fast forward a 100 years

on planet Earth and if you look at the

past 100 years and the 100 years before

that like energy demand uh even on a on

a per capita basis has this nonlinear

kind of scaling problem and that means

that land consumption will scale

nonlinearly now we have it if we're

gonna say 100 years though I mean so

interrupt you're gonna say 100 years

technology changes it's very clear you

could probably do it from space if you

really wanted to I mean this sounds

crazy but you probably could have like

tons of these in space 100 years is far

I mean we have we have enough uranium in

just the crust of the you know like

Norther hemisphere to in other words

power to power everything we on thege of

unlimited energy for all time just to

wrap this up and move us on if we can

get out of our own way get out of our

own way with a bunch of midwit who have

put so much regulation in place and who

are working from home for four hours a

week if we can just get them out of the

way then maybe we could approve some

nuclear reactors and a little more solar

batter did you just call did you just

call government workers midwidth is that

just the ones who are block

if you're not blocking and you're

working 50 hours a week God bless a lot

of people working hard in the government

I that's exactly my point but there's

some number of them who are just

obviously do not see the forest through

the trees by the way on that point Jal

it is interesting Texas is the number

one solar producer in the country and

it's not because everybody there is more

environmentally conscious no we're not

that liberal subies it's just it's easy

to build stuff in Texas build solar

power plants this is I mean for the Libs

in cities who are so Pro solar and anti-

natural gas or whatever yeah look at

Texas they're just build as much as you

want and where Joe and I live in Austin

home prices have gone down two years in

a row rent has gone down two years in a

row they are building like lunatics

because you don't need to beg and and

bribe people to build stuff Joe maybe

some thoughts on what we've seen in

regulation Austin Austin city council is

not perfect Austin they called the

blueberry and the tomato soup so there

may be a tiny bit of begging going on

but despite that you're able to build

there and everywhere else around You're

Building like M so it works there's

there's there's plenty of Supply I agree

speaking of Regulation Gary Gensler is

out Paul Atkins is in uh and Bitcoin

just cracked a 100 this is all obviously

related Atkins was previously SE

commissioner under Bush 2 in the early

2000s in the 90s he worked for both Bush

one and Clinton at the SEC according to

the New York Times Atkins is admired

among DC Legal C circles and Regulators

he's Pro crypto and he's been helping

draft some best practices for the crypto

trading platforms as you know Gary

gensler's approach to crypto was there's

a rule set follow the rule set we're not

here to change the rules we're here to

enforce them good luck and in some cases

I think maybe he was right with icos and

a bunch of scams but he also gave good

actors no path to go forward anybody

have strong feelings on this I love Paul

J keelly I think he's I think he's gonna

he's a fair guy yeah I've met him

several times at conferences and groups

and he's really smart guy cares about

the rules cares about helping innovators

I the thing that really pissed off you

wenter off with Gary I mean I love

you've probably seen like I think I

think uh I think both coinbase with

Brian and the winlos twins that put

something out they won't even hire

anyone who worked with Gary on any of

this stuff they were doing and the

reason they're that angry at them is

they were purposely not defining the

rules in certain cases and then going

after people after not having to it in

order to kind of like play a Goa game

that was very dishonorable and Paul sees

all that and there's no way he's going

to allow that Gavin any thoughts here on

how this might change regulations in our

business also the fund business Joe is a

venture capitalist hvc uh you in public

markets and funds I have I do preedee so

yeah what do you think in terms of funds

and regulations there and then crypto

and and you know the SEC may be becoming

Innovative as opposed to punitive and

you know

what's the word for freed BG what's the

word I'm looking for here adversarial

well they are a regulator they are a

regulator but they don't also seem they

seem to have gone beyond just regulating

they seem to have been aggressively

adversarial yeah I mean they're

regulatory enforcement agency that's

their job so I I don't know like you

know I mean but not giving a path or not

even meeting with people I think that

was the thing that I felt was kind of

weird like they meet with you if you

were a big donor to the left they

wouldn't meet with you otherwise that

was part of it too that was sketchy that

was why SPF got tons of meetings but

Brian got none right I mean it's

nonsense like that ah go I do think

cryptocurrencies yeah go ahead at some

level fundamentally reduce the power of

nation states and that is something that

is of professed by the True Believers

but it is true and so if you um are on

the left and you know you are um a

devout believer in the power of the

state to do good things I get why you

not like

cryptocurrencies you know at the same

time we're very early in crypto I do

think I read with interest all of the

post that David Marcus and his peers at

Libra made um made about what happened

to them Libra was a Facebook project to

embrace cryptocurrency at a very

intrinsic level onto the sort of

identity level of every one of their

billions of users and I think you can

argue it would have been really really

good for not just America but the ENT

World um you know there are a lot of

immigrants in American in America who

send remissions back to their home

countries at extremely high um predatory

rates yes yeah predatory rates it would

have made that free and that would have

been amazing for a lot of really

hardworking um people all over the world

it would have you know Visa Mastercard

they do charge big fees I mean not Visa

Mastercard do not charge big fees but

the um credit card complex and aggregate

is a is a reasonably big fee I mean

everybody oh it's just you know two two

and a half percent to make it you know

perfect and safe um I think Facebook had

a sound argument that they could have

done that cheaper and that would have

been an efficiency game for America and

it really did bum me out you know to

read some of the

letters that they sent the way they

killed Libra if anyone doesn't know and

maybe we can you can pull up David

Marcus's post they just all these

politicians sent letters to participants

and financial markets saying we don't

know if they are doing anything wrong

but we think they probably are and we're

going to look at this very closely and

we want to discourage you from

participating it was wor it was worse

than that it was like a mafia letter it

was like if you are to support this and

help with this we are going to look into

everything else you are doing and we may

then find some issues it was it was like

a mafia threat we can't stop you legally

but watch out like it was really sketchy

it was shered brown who who now is out

of office who led this senator from Ohio

but it was it was really bad it was

really bad what they were doing it was

really bad I found it upsetting as an

American and and it's you you kind of

hinted at this Gavin the fear of

governments is that they will lose

control of money supply and monetary

policy maybe unpack that a bit and then

freeberg will go to you on the same sort

of uh thread yeah I mean look it's a it

is a rational fear I mean controlling

monetary Supply like at some level the

you know the greatest you know Powers we

give the state are a monopoly on

violence to keep us safe um and you know

control over the money supply has you

know a means of exchange a unit of

account um and those are great Powers

particularly if you're America and your

reserve currency the only thing I would

just say to balance this out um and I do

think people are are very positive on

Paul Atkins I've never met him but the

reaction from people who know him like

Joe and who I respect has been very

positive is important to remember we

have the best Capital markets in the

world you know the US equity and fixed

income markets are the most trusted

places on Earth and we can always make

them better but just it is very you know

you you want to be very Vigilant about

keeping them fair and keeping out things

like inside information which makes

people feel comfortable doing business

here you know making you know having

investors have confidence in a company's

financial statements and those fincial

markets are one reason America is such a

great country and Gavin to put this in

context this was during a time period

this David Marcus Libra process when

they felt certain people in government

and I'm not saying I endorse this but

this is their position Zuckerberg had

too much power Zuckerberg was censoring

people the right felt they were being

censored the left felt that Cambridge

analytica and people were using

targeting the first Le the general Vibe

and even JD Vance is kind of was in on

this as well was too much power

specifically at meta too much influence

now they've got this many people this

penetration and the algorithm plus we're

going to give them money and they're

going to have power over people's wallet

and then what does the government have

they can't censor people they can't

control the message and they can't

control the pur strings that that is the

time period we're talking about here oh

no no I understand 100%

why they did it I just think as an

American at a minimum the way that they

did it yeah was to you know use one of

Joe's phrases dishonorable you know if

you if you want to say that we're going

to kill this then just like let's have a

debate as a nation absolutely don't do

it in Shadows yes rule of law rule of

law is also another reason America is a

great country yes freberg your thoughts

on Dave marcus' comments

and this sec pick and and just generally

a more Pro less regulation kind of

situation I think the is like one of the

most important agencies we have and I

think they're one of the best federal

agencies so I've worked with them and

I've worked with any other agencies and

there's all these issues with the SEC

but they play a very important job and

if you've worked in in foreign markets

and you've dealt with foreign Securities

Regulators you're going to be like thank

God for the SEC like can't wait to go

back this whole crypto thing I there

there's there's a distinction I think

between Bitcoin and cryptocurrencies as

speculative kind of assets speculative

trading what do you see those

differences as well I I definitely

concur with Gavin I think Bitcoin

fundamentally is meant to be supposed to

be ultimately will become a real threat

to the US dollar and it's kind of ironic

that Trump had this declaration this

week yeah that he's going to put 100%

tariff on All These Bricks Nations that

try to participate in an alternative

currency to the US dollar the greatest

currency on earth when he literally

turns around and then says we're going

to support Bitcoin it felt like the

biggest irony of the week to me because

I do think Bitcoin is the big threat to

the US dollar and I do think that at

some point whether it's this

Administration or the next they're going

to wake up to that fact and maybe the

the Bitcoin does you know the network

State concept does emerge and that's

where we end up but I do think we want

to have and are going to have a strong

federal government in the United States

for quite some time

that's going to play an important role

in everyone's lives here and I don't

know if you can really just say let the

dollar you know be supplanted by Bitcoin

Bitcoin seems to be a more of a safe

haven asset and that seems to be the

trade that it's store value should be

kind of store value and alternative it's

just gonna take over gold what do you

think you think um the state has

reasonable concerns about crypto

competing with it and then maybe

specifically when you saw Trump talking

about hey congratulations on your

Bitcoin I did this for you on 100K and

taking credit for it at the same which

he should take credit for it he did it

he did that last $40,000 per coin and

then you see him talking about the

bricks and then we have the US currency

so which is a bigger threat to

American uh exceptionalism and Supremacy

on planet Earth Bitcoin or bricks so one

represents a move towards Liberty and

what one represents a move towards

authoritarianism if bricks were to

become dominant if China and Russia were

able to control global currency together

and and other players that is terrible

it's bad for the US for so many reasons

bad for us consumer for so many reasons

he's right to fight it at the same time

having you know to channel biology

having this like Pro Liberty Network

State like like forces in that direction

like for example I think rather than

just you know Hong Kong and Singapore

Hong Kong's been lost we should have

like more Hong Kong and singapor in the

west to compete with the US that'd be

good for all of us who are on the pro

Freedom side of the US and make the US

wealthier would show examples of of new

experiments that create great wealth and

then that's kind of the side of Bitcoin

is you want more experiments and

competition from the Liberty distributed

side you don't want competition from the

authoritarian side so to me it was very

consistent yeah well I would just say

Texas is the Singapore of America you

know and it is putting pressure on the

rest of America and I don't say that

just because I grew up in Texas um it's

just a fact I do think longterm Bitcoin

I do not think the bricks will ever be

able to replace the

dollar just rule of law even if it has

occasionally been corrupted in America

is very very powerful yes as opposed to

rule by law and but I do think

Bitcoin will at some point be a serious

threat to the US

dollar and that just is what it is and

we'll see how different administrations

react would that it's a check on it's a

check on the most aggressive mistakes

first of all if the debt is doesn't get

under control if our deficit is

ridiculous Bitcoin is a wonderful check

on that you actually want healthy

competition from something good because

you want to check the excess is and the

craziness you want you you need someone

coming from the outside to say no don't

do that let's just say at some point an

AOC like person gets in charge it could

happen in the next 20 years you need

some kind of check on the dollar and

it's much better to come from the

Liberty side than from the other side I

agree with all that I will just say on

AOC I thought it was very interesting I

think if you're a Democrat I think

you're probably largely heartened by the

kind of intellectual leaders of that

party their reaction to losing you know

it's focused around hey we do need to D

regulate it is too hard build Josh

Shapiro's been tweeting every three days

about how he's making it easier you know

to do business in Pennsylvania it used

to take 20 days to become get a

hairdresser license now it takes an hour

all that is good um but I actually

thought AOC who is a very talented

politician she's an extraordinary

Communicator she's an extraordinary

Communicator her reaction was like she

posted this on Instagram if you voted

for Trump I want to hear why I want to

hear the things you listen to that

convinced you

like I don't say this out of anything

other than genuine curiosity basically

clearly I am missing something and I you

know I want to listen and I just thought

that was a very interesting reaction

that is the proper reaction yeah

absolutely yeah I want to point out one

thing I did I was doing some research uh

before the show and I found this SEC

speech this is uh really fascinating

this is from 2007 from Paul and he was

kind of giving his State of the Union

here and he talking about doing some

self-reflection and he's talking about

accreditation rules in 2007 before the

great financial

crises the concept of economic risk and

return also affect a different proposal

of the commission the

SEC relating to private investment funds

specifically part of The commission's

Proposal proposal would add an

additional requirement for any natural

accredited person to have at least 2.5

million investments before he or she

could invest in private investment F in

a private investment fund like AE fund

or private Equity Fund other than a

venture capital fund the underlying

premise for the commission's proposal is

that these types of Investments are too

risky for individuals other than the

very rich therefore we would have to

presume that the non-rich are either

unsophisticated or lack access to

sophistication and it is simply not

tolerable to have these types of people

at risk of losing their money on a hedge

fund assuming that these premises are

true however what Evans does the

commission have to support the

conclusion that private investment funds

are the most risky what makes a hedge

fund fund or a private Equity Fund more

risky than a venture capital fund great

question and how does the risk profile

of a pulled investment compare with the

risks of investing in Securities of a

single issue for which this new 2.5

million standard is this is where it

gets super interesting many public

comment letters Express indignation at

the commission's proposal one

commentator wrote stay out of my wallet

stop trying to protect me from myself

stop presuming to know more than I do

about my own life risk tolerance and

financial sophistication the

commission's pr me very well prevent the

non-rich from losing their money in

private investment funds but it also

certainly will prevent the non-rich from

participating in any upside profits and

gains on these funds does this mean the

rich get richer while the non-rich

should be content to just hold their

place on the economic ladder this to me

when I saw this I was like you know what

I am feeling absolutely fantastic about

Trump if he stops these wars or stops

one out of two and keeps us out of you

know participating even though we're not

on the around with the other any new

ones and he removes regulations and we

have people in power who understand that

moving up the socioeconomic ladder is as

important as protecting the downside

risk especially when we see wealth

polarization this is a great pick now

the other picks there's some wackpack

picks in there I'll be totally honest I

don't know what the strategy is Joe I'll

ask you that in a minute but what do we

think um Gavin of this sort of approach

here which is really thinking

thoughtfully about what is sophisticated

and and what are we doing here what is

the outcome we're looking for yeah no I

think it's great and you could just I

mean the reality is a hedge fund that

runs with a lot of Leverage probably is

more risky I don't know that it's more

risky than a single security but

um like at the end of the day since he

wrote that letter it was an incredible

15-year run for private equity and you

know now all the big private Equity

firms are making a huge effort now um

when probably the business is more

mature and maybe the return

opportunities aren't what they were to

appeal to Main Street America like it

would have been cool if you know

Blackstone or KKR or whoever in 070809

2010 you know could have had their fund

up on like the Fidelity Marketplace for

subscription that probably would have

been good for America so I think his

comments are well taken imagine if Elon

could raise for SpaceX like you know

from regular Americans I'm sure he would

have loved to do that if it wasn't crazy

risky with the SEC right so there's all

these people they're blocking us from

letting the average person be part of it

it does keep them from climbing the well

flatter I think it's crazy yeah freeberg

any thoughts here I mean this has been

my pet peeve for a long time is letting

people do what they want with their

money if you don't allow people to take

risk with their money and move up from

poor to middle class from middle class

to upper middle class and maybe

eventually becoming affluent Jason

there's a lot of places people can

invest their money they can buy public

stocks there there's $20 trillion of

public stocks they can buy I don't think

that you're prohibiting people from

transitioning their wealth like banss by

not being able to buy private stocks in

fact I think it's more likely than not

that people are going to go market

Securities in private markets

and rip poor people off even worse and

that's why there are these regulatory

kind of barriers and I don't think that

it's necess look everyone says let's

make it everything free and everything

libertarian seems like a good idea until

someone gets punched in the face gets

ripped off someone dies from a drug you

know that's not properly tested and then

we're all like where were the Regulators

where were the agencies to protect the

individuals and I think that's the role

that these agencies are are kind of

providing and that's the reason these

rules are in place I don't think that

this is like one of these things where

oh Liberty's being denied I think it's

you know there's a there's a care

there's a careful line to

walk I'm generally pretty CC in most

things so I agree with what a lot of

David said and I do think if you were to

allow ordinary Americans to buy private

companies that are held to a lower

standard of disclosure and Reporting

than public companies like something

would have to change like you know just

hey if if a private company wants

to like public companies are you know

are held to certain standards for reason

TW the numbers and non financials and

yeah and there is a lot of fraud in

Venture there are unethical people there

are and smart diligent people can't even

find it all you know that's it's like

the smartest most diligent people are

still getting ripped off yeah I mean

look at FTX I mean I mean FTX ripped off

some very very intelligent friends of

ours did did any diligence at FTX yeah

but well which is an important part of

this but I mean if you had a

sophistication I mean there's such an

easy solution to this you just do a

sophistication test people take a 5 hour

course and they answer 50 questions the

end like a driver's license well I do

think it is a little that's why I talked

about private Equity these are extremely

sophisticated institutions who are

always in vesting alongside their

clients y um and they're buying

established businesses they're putting

leverage on them but like I think

private Equity is kind of a middle

ground and a on a pooled basis I think

you could argue and you know maybe those

funds would need to change their

reporting and their disclosures to deal

with kind of the average American but um

and by that I mean strengthen

it but I think private

Equity his comments were well taken

that's what I would say Joe what are

your thoughts yeah I mean I think the AL

here the alha of the room that's really

funny here is that you have the people

on the left saying the only people with

lots of money are smart enough to be

allowed to do this which I think is just

a very funny position to take if you

just like you have to have a few million

dollars to be sophisticated enough to be

allowed do this I like your idea JC of a

test like like there should be there

should be some other way of accessing

this if you really want to I me I agree

I agree listen I don't want to live in a

world where we're all constantly being

spammed to the average person by like

stupid Financial stuff that's just like

we would be scammed all the time there

probably should be some rules like I

agree I I'm not like a total libertarian

on this I think it'd be really annoying

but yeah but just to totally block

people from participating to me that

sounds

crazy like I mean a finance college

professor you know might um unless they

had another job might not you know be

able to

do

$250,000 let's talk let's talk about a

very important Public Market set of

transactions G I'd like your point of

view on Michael sailor's convertible

note issuances being used to bitcoin the

to which this morning this morning

Bloomberg reported is the hottest trade

in hedge funds right now Nick if you

could pull up the article and then jel I

know you've been an

outspoken opinion Setter on Michael

sailor's promotion of his Securities

actions we'd love your point of view

Gavin just say at some point this does

get too big for a while when it was

smaller

you know you could support the debt

sorry could you explain it could you

explain it to everyone Kevin yeah so

what he is doing is issuing debt and

buying Bitcoin with the premise that

Bitcoin is always going to go up and he

you know has made eloquent arguments why

why that is the

case no trees grow to the sky and I

think the interest expense on his

convertible notes is 75 million off the

top of my head and by the way I am I

could care less about micro strategy

like I'm not close to it I'm not

involved yeah I don't know any hedge

funds who own it no horse in the race

yeah yeah I I think a lot of hedge funds

are short micro strategy but I have no

horse in the race but the but his the

underlying

business that you know pays the interest

expense on the

debt only does $400 million a year in

revenue and it's you know high gross

margin Revenue

but I just

unless debt

investors have absolute confidence and

Bitcoin has collateral and I don't think

that's where fixed income markets are

yet he it will get to a point where it

is it is too big for the size of his

company and then yeah maybe he can over

collateralize it and you know have $10

in Bitcoin for every dollar of

debt but then like the the magic money

creation machine that you know I see

discussed on X breaks down because

that's like you know that's

[Music]

um that's very very different than what

is being discussed today Joe do you have

a point of you because Joe's got a run

by the way so Joe you want to close this

out defense people down here in La

listen listen I am very bullish Bitcoin

I love the all energy of our society

around it I I agree with what you said

Dave that there's like there needs to be

some barriers for the public taking

crazy risks and I think the risks around

how he's accessing this is actually very

unusual and does scare me a bit and

people need to do their research so they

shouldn't just like throw money without

studying it it it does scare me a little

bit how blly people are throwing money

at this without knowing the kind of

Leverage he's taking you know yeah Joe

anything else you want to share that

you're up to that you're excited about

before you head out uh well you know uh

I this this weekend is the annual

Defense form at the Reagan Library we on

the board it's the biggest biggest

defense event of the Year everyone's

coming and I I guess I guess I'm really

excited that America has like woken up

in assuming we can bring back more

advanced manufacturing here I think

there's enough top companies now with

andrel with seric we're gonna be

building thousands of these vessels for

the Navy with AI uh with epis we're like

turning things off you know 10 miles

away whatever fairly far away with

microwave radiation there some really

cool technology coming that actually is

going to make us be able to deter our

enemies so if you ask me six seven years

ago I was panicked we we're gonna like

get way behind China I'm feeling really

good about it now I think and and I

think I think you know just this the

Pete Heth pick uh you know is actually

someone I'm quite bullish on from

everything I'm hearing so I I think

things are going the right direction is

there a wholesale upgrade happening in

defense in the United States are all

systems and all strategies being

rethought right now uh using technology

and Innovation and kind of a

performance-based product mindset

leading uh kind of a reinvention of

Everything Is that what's going to

happen in the next four years Warfare is

fundamentally totally shifted we're

seeing some of this in Ukraine there's

all sorts of new ways you want to swarm

things on the LAN land swarm things in

the water swarm things in the air how do

they coordinate and how do they work

together how do you manufacture enough

of these things and and how do you use

electronic warfare and new ways to you

know it's basically created by this and

so that it's just a whole new way of

doing things and we are going that

direction too much of the money David

like 95% of the money is still going

towards like frankly like wasteful

Legacy like mostly things we don't need

plus

main but enough is Shifting and there's

enough good people fighting and as long

as we keep just allowing open

competition to say okay which is better

and just let the best things win as long

as we keep doing that I think it's going

the right way I'm feeling very good

about it is the Chinese position shift

in their technology strategy and their

system strategy gonna motivate a shift

here do you think shift underway already

I mean it definitely already has so we

don't we don't need big aircraft

carriers we don't need f35s we need

drones we need lasers I there's a ro I

think there's a role for carriers and

force projection I don't think we need

like incrementally a ton more of them I

don't I'm not I'm not like this radical

where you get rid of all this but yeah

on the margin I'd much rather have

10,000 more smart drones above and below

the water than like an in incremental

carrier right so there's there's on the

margin there's all these things that are

better uses of money and I think we're

pushing that way and is there a huge

tidal wave of venture money I was at a

dinner last night where there was this

conversation about defense Tech used to

be off limits and a lot of LPA say you

can't invest in defense companies that's

now changed or is changing and

everyone's kind of coming up with their

own defense Tech strategy do you think I

mean you were obviously in this cabin I

don't know if you're an investor in the

space but are you guys seeing a big

shift yeah I I obviously you know listen

there's only been nine unicorns I think

still at this point and I started three

of them and invested three of them the

first round so I'm obviously pretty

involved in in the space and I think

listen it helps me if there's more money

for my companies which is really great

um right I think there's probably the

right answer for the US is not going to

be like a thousand businesses or 100

businesses it's gonna be it's gonna be

like seven to 10 new primes one of

them's obviously andal I think one is

probably cic and epis we'll see but like

there's going to be 7even to 10 new

primes and that's what it's going to be

so there's going to be a lot of zeros

and a lot of bad Investments but yes

these seven to 10 new primes are going

to be huge and if you can get access to

them you're gonna do really well Gavin

how do you look at that market you agree

I I agree with everything um Joe said

the only thing I would just add on China

what we are doing by restricting their

access to Advanced um compute and

advanced networking if you have read or

watched the three three body problem

America is unfolding a sofon over China

yeah yeah that's great way I say it I

have been really impressed with um some

of the Chinese models that have come out

and I think the risk to this strategy is

necessity is the mother of invention and

despite this handicap they're managing

to stay just behind the Leading Edge of

America which is

amazing but you know nvidia's Blackwell

chip comes out next year you're gonna

have new chips from AMD new A6 from

broadcom and I I think at that point it

it is not going to be possible for them

to keep up

anymore so that's actually positive

regulation and great in your mind

foreign policy

um it is very aggressive foreign policy

yeah clearly you know that could have

lots of unforeseen consequences yeah

what do you think about the the rare

earth trade restrictions coming to us

and is that going to actually affect

this Supply we have lots of rare earth

here in America like in America we have

everything in America like we you know

and I think there's a project underway

to restart Rare Earth production there

ever ever to be a conflict all this

stuff would go away it's it's it's a

cost and it's allowing us to do the

refining here so refining some of this

stuff like we desperately need gallium

gallium nitride for things I'm doing

right with with like shooting the

microwave radiation the problem is the

refining is really messy if you let it

happen in the US it will still be messy

but it will be cleaner but we're not

letting it happen so there's things like

this ulation and obviously the cost here

is different we have a different cost

structure Joe you got to go meet 20

Senators so thank you we

appreciate good times jcal do you want

do you want to talk about AI with Gavin

and I think that would be like a a great

next place to go would be to talk about

the supercomputer being built by friend

of the Pod Elon he's now got the world's

largest super computer and he's going to

10x it according to

reports yeah and I would just say this

is I think a very important moment

for

AI you know for this entire AI trade in

public and private

markets you know everybody I'm sure who

watches your podcast is very aware of

scaling

loss and we have not had scaling loss

for training or if you 10x the amount of

compute used to train a model you

significantly improve the intelligence

and capability of that model and often

there are these um you know kind of

emergent properties that emerge

alongside that that higher IQ no one

thought it was possible to make more

than

25,000 maybe 30,000 in 32,000 pick a

number Nvidia Hoppers

coherent and what coherent means is in a

training cluster that each

GPU to kind of simplify it knows what

every other GPU is thinking so every GPU

in that 30,000 cluster knows what the

other 29,9 199 are thinking and you need

a lot of networking to make that happen

enabled by infiniband right uh

infiniband and and I think even more

importantly in vlink although a lot of

ethernet is um you know never bet

against the internet NE never bet

against ethernet um like if you read the

Llama 3.1 technical paper you know got a

lot of people excited about skinny link

ethernet but um just to slow down for

the audience here Gavin maybe explain

why trans sporting information between

the gpus is important and we're talking

we we're in the weeds here a little bit

everybody's heard of ethernet but some

of the other protocols and ways of

moving stuff around large amounts of

data that's what these h20s h100s do

particularly well they'll move a couple

of terabytes a second from One processor

to the next processor yeah so um you

know

picture a

server in the case of

GPU it looks like maybe three pizza

boxes stacked on top of each other and

it has eight gpus

together and those H gpus are connected

today with something called NV link

probably you can think of the speed of

communication on chip is the fastest tip

to memory next fastest you know um chip

to chip within a server next

fastest and so you take those units of

servers

which are connected the gpus are

connected on the server with a

technology called NV switch and you

stitch them together with either

infiniband

or ethernet into a giant cluster and

each GPU has to be connected to every

other GPU and know what they're thinking

they need to be coherent they need to

kind of share memory for the compute to

work the gpus need to work together for

AI

and no one thought it was possible to

connect more than 30,000 of these with

today's

technology from public reports Elon has

he so often

does Focus deeply on this thought about

it from first

principles how long it should take the

way it should be done and he came up

with a very very different

way of Designing a Data Center and he

was able to make over 100,000 gpus

coherent no one thought it was

possible if uh I was I was a last minut

ad for this but I would have said there

were all these articles that were being

published in the summer saying that no

one believed he was going to be able to

do it it was hype it was you know

Ridiculousness and that was coming the

reason the reporters felt comfortable

writing those silly stories is because

engineers at meta and Google and other

firms were saying we can't do it there's

no way he can do

it he did it and I think the world

really only believed it when you know

Jensen did that podcast I think with uh

was it with gersner am I with gers yeah

it was with kerser and said um what Elon

did was superhuman no one else could

have done it and I actually think you

can argue that Elon doing that in a lot

of ways kind of Saved Nidia from a tough

six-month period when Blackwell was

delayed because everyone who was waiting

for Blackwell and thought it was

impossible to make a 100,000 Hoppers

coherent rushed out and bought a lot of

Hoppers to try and do it themselves now

we will see if someone else is able to

do it it was really really

hard no one else thought it was possible

and as a result of that gr 3 is in

trading now on this giant Colossus

supercomputer the biggest in the world

100,000 gpus Memphis the old Electrolux

Factory and they're they're putting a

lot of energy in there a lot of natural

gas a lot of yeah a dingy Electrolux

Factory yeah with a lot of Mega packs

around it and the City of Memphis is all

in unsupportive this yeah which is

obviously smart for them but you have

not had a real test of scaling laws for

training arguably since gp4 and this

will be the first test and if scaling

lws for training hold grock 3 should be

a significant advance in the

state-ofthe-art

that is an immensely you know from like

a basian way to look at the world that

is like an immensely important data

point but it if that card doesn't work

and I think it is going to work I think

rock rock 3 is going to be really good I

should note that I am with consumers

yeah you're you're involved my firm is

an investor in X got it yeah they

they've raised a tremendous amount of

capital A lot of it from the Middle East

and they're supposedly going to build

Colossus to a million gpus is the state

of goal 10 times bigger than it is

currently there's been some debate back

and forth freeberg about hey are we

hitting a wall here maybe you could

explain the wall either of you to the

audience yeah David well I'll I'll let

Gavin speak to the wall I I mean Gavin I

think one of the questions also is you

know do we

see an evolution

if if the kind of increment in

performance relative to the investment

in net kind of training compute

resources

declines do we start to see a shift in

um how the architecture of the systems

are run meaning like do we start to

build models of models and that starts

to resolve a higher level architecture

that unlocks new performative

capabilities so I would just say we're

already building models of models you

know almost every application startup

I'm aware of is chaining models you know

you start with a cheap model you check

the cheap models work with a more

expensive model you know lots of very

clever things are being done you know

every every AI application company has

what's called a router so they can you

know swap out the underlying model if

another one is better for the task at

hand

[Music]

um as far as what the wall is there's

been a big debate that we were hitting a

wall on these scaling laws and the

scaling laws were breaking down and I

just thought that was deeply silly

because no one had built a cluster

bigger than you know 32,000

h100s and nobody knew it was it was a

ridiculous debate and there were you

know really smart people on both sides

but there is there there's no new data

grock 3 is the First new data point to

support whether or not scaling laws are

breaking or holding because no one else

thought you could make a 100,000 Hoppers

coherent

and I think based on public reports

they're going to 200,000 um Hoppers and

then the next chck is a million it was

reported they're going to be first in

line for Blackwell but grock 3 is a big

card and will

resolve this question of whether or not

we're hitting a wall the other question

you raise David is very interesting and

by the way we should note there is now a

new axis of scaling some people call it

test time compute some people call it

inference scaling and basically the way

this works you just think of these

models as human the more you speak to

one of these models the way You' speak

to your like 17-year-old going off to

take the SAT the better it will do for

you as a human you know if I ask you

David what's two plus two four flashes

in your mind right away if I ask you to

you know unify a grand unified theory of

physics that accounts for both quantum

mechanics and relativistic physics you

will think for a lot longer we have been

yeah nobody knows we have been giving

these models the same amount of time to

think no matter how complicated the

question was what we now learned is if

you let them think for longer about more

complex questions test time compute you

can dramatically improve their IQ so

we're just at the beginning of this new

scaling law but I think the question you

rais on Roi is very

good and I'm happy to address and

there's a context

window oh shift under way as well which

also creates a new kind of scaling

access arguably in terms of potential

set of applications so networks of

models think time context window there

are multiple Dimensions upon which these

these tools ultimately kind of resolve

to better performance oh yeah we have

even if scaling laws for training break

we have another decade of innovation

ahead of us exactly and and and as my

understanding from speaking to folks I'm

certainly not as deep in and well versed

as you but there's a lot of effort and

research going on in re-engineering

various parts of the uh the stack to

reduce energy to reduce every resource

that effectively drives model

performance to basically re-engineer

architecture it was all like very Brute

Force for a period of time and it was

like push push push but now as we go

back and we start to re-engineer and

architect things in perhaps a more

designed way we get better performance

and there's a lot of work to do there

still absolutely this is one of the

great things about capitalism and a

functioning Capital Market is you've got

people working just on the context

window for people who don't know what

that is is

that's the number of tokens a token is

essentially a word you can think of it a

piece of

information the number of tokens you can

put into a conversation with a large

language model some people have really

large context Windows some people have

smaller ones but you can basically put

an entire book in the context window and

start asking questions against the model

and the speed of those is critically

important as well because if you put the

book in there and it takes you 10

minutes to get an answer that's not

functional right Gavin are you an

investor in open AI oh I absolutely not

yeah can you kind of theorize on what

the buildout that's being done with

Colossus does to the advantage that open

AI has today how long till we kind of

catch up there with xai and you know how

much is going to be disrupted and how

quickly here well if scaling l

Hold the best information I have is the

largest cluster Microsoft has after

panicking is still smaller than XI

cluster in

if you didn't believe it it was possible

you you weren't even working on

it grock 3 should takes the lead if

scaling laws

hold in January or

February I do think a lot of talent has

left open

AI I thought it

was a really shocking statement from

Mira moradi that she um resigned during

a fund raise that's the only way she can

express disapproval of what is going on

there and still probably get her money

right so I

think I think there's there's a lot of

reasons if scaling lost hold to be to to

be optimistic about Croc

3 but I think um and and then by the way

on the power question and and they are

you know 20 23 and 24 it was just a

panic to get gpus and get them plugged

in now we're you know trying to make

them efficient and thoughtful into your

point re architecting them and the h20s

now are 50% less power and either 50%

more twice as much compute depending on

the task they they have a little more

compute and a lot more memory which

really matters um so per kind of unitive

effective compute they're a lot more

power

efficient they two or three times you

think or no the h20s probably not

probably not 2x but a good increment and

the h100 was a great chip and then

yeah yeah black well is just around the

corner and that's an entirely new

architecture with an entirely new set of

networking technology what would

consumers if we had to sort of speculate

here what would consumers how would

consumers experiences change in using

forward-facing language models and then

maybe what are developers going to see

on the back end you know in terms of

what they're going to be able to build

if if this hands out you know in the

next you know right now two years yeah

right now you have like a friend in your

pocket who has an IQ of

115 110 maybe but has all of the world's

knowledge yeah accessible to it and

that's what makes it amazing I think

this will be like you have a friend in

your pocket but and they sometimes make

things up again they're very human and a

lot of humans when they don't know the

answer they dis symble yeah these AIS do

it too so you will have a friend in your

pocket with an IQ of what maybe 130 that

knows everything has more upto-date

knowledge of the world

and is more grounded in factual

accuracy and it is interesting for any

question involving realtime information

mostly Sports and finance you know I

always you know if there's a stock down

25% ask every AI why is the stock down

25% generally grock is the one that

knows um

but yeah no Gro grock because of the

Twitter data set exactly knows what is

happening at the moment in the world

today all right and then you know as we

sort of wrap up here on the AI

issue what about the ROI here that David

was mentioning yeah so the I find these

these debates also very funny you know

there have been articles written about

multi hundred billion dollar Roi

questions those are very strange to me

because yeah the biggest Spenders on

gpus are public companies and they

report Financial results every quarter

and you can calculate a metric called

return on invested Capital yes and roic

Roi has gone vertical since they ramped

their capex on gpus it actually just

started to level out in this latest

quarter so the ROI on AI has been very

positive thus far just a fact it's a

really good question will it continue

particularly if you know it's going to

cost a hundred billion dollars to train

a model in two or three years um which I

think is a realistic estimate um however

gu the counter to that isn't the counter

to that that maybe there's a little bit

of hype that you know maybe there people

are trying to determine the ROI and

correlate it more

precisely and I guess that's the

challenge you know meta doing AI across

its entire Enterprise you might see and

Google you might see

it directly making ads more effective as

an example 100% yeah go

Oni yeah but then for other folks like

you know is it actually happening or is

it a toy I guess is the criticism I hear

I'm not saying that's my position but

that's the criticism I hear is like are

people actually getting money from the

co-pilot or maybe this is just product

Market fit Discovery process because the

the AI

laptops AI Intelligence on Apple and

let's say some general llms people feel

maybe aren't worth the money or co-pilot

for Microsoft maybe not worth the money

yeah I mean I personally have not had

good experiences with co-pilot but I

would

say that and I'm sure both of you have

come across these there are lots of

companies that are just these thin

rappers over a foundation model and they

go from zero to 40 million

instantaneously yeah and they're

profitable and for their customers

they're replacing labor budgets I think

I'm sure you guys are noticing this too

but startups today at a given size are

employing fewer people than they would

have three years ago and just like you

know it's funny people were very SK I

would say 50% less yeah and that's the

ROI on AI and like in you know I went to

the first AWS reinvent conference and no

big companies were using cloud computing

it was all startups startups always

adopt Technologies first so outside of

the ROI on AI that you're seeing in

Google and meta from you know using this

across their businesses you seeing real

Roi on I from startups the same way they

saw real Roi from cloud computing before

anyone else it's crazy but I don't think

these companies are in a classic

prisoners dilemma they all believe to

varying degrees that whoever gets there

first to artificial super intelligence

is going to create tens or hundreds of

trillions of dollars of value and I

think they may be right and I if they

get there and they think that if they

lose the race their company is at Mortal

risk so as long as one person is

spending I think they will all spend

even if the ROI decelerates it is a

classic prisoners dilemma competition is

amazing it really is when you have a

free market with competition we're

sitting here two years ago three years

ago on this pod Gavin just lenting like

oh my God what could happen and China

could just roll over us they've got

everything dialed in we're a disaster

and now here we are China's a disaster

they've got all kinds of challenges and

the free market is even with weapon

systems we're seeing capitalism applied

in competition applied there all right I

think we should just wrap up on this uh

Brian Thompson Story the CEO of United

Healthcare was shot and killed in

outside a Manhattan hotel on Wednesday

morning United Healthcare is an

insurance subsidiary of United Health

Group and uh they employ over 140,000

people they provide coverage to

millions and this

was I don't know if you've seen them

assuming you guys have seen the video on

social media or go by on

X it there's been a big debate was this

like a really well-trained killer like

an assassin like a Hired Gun was it

something personal maybe and this

person's a hack and they're not really

good at doing a hit like this and most

people are sort of coming somewhere in

between ABC has reported and this is

where this thing is taken like a crazy

turn that the words deny defend and

depose were discovered on the bullet

casings at the

scene and those are the

terms two of the three are in a book

about how health insurers uh reject many

of the claims every year they deny it

they defend it and then they will depose

people to harass them

essentially this is a crazy crazy story

and it's breaking here I don't know if

anybody has any insights on it but I

thought I would bring it up here to just

maybe intelligently speculate about what

we've seen I mean it seems like the most

likely case is someone's loved one died

for they were denied coverage and what

whether this person was hired or they're

a victim or related to a

victim I don't know if it matters I I

think

there's the observation I'll make is a

question which

is should CEOs be personally responsible

for corporate actions generally speaking

so there's a difference between a CEO

committing fraud or being negligent

but if you don't get a good service or

good quality of service or the product

you expect even if it is something you

depend on

for healthare for example let's say you

take a drug and the drug causes a side

effect that causes some permanent damage

should the CEO be individually held

accountable and if that were the case

would anyone want to be a CEO of a

company that sets out provide services

that are critical like this it's a very

like I think challenging question to

think about because certainly you could

feel like you want to hold someone

responsible because a loved one died

because that CEO's job was to make more

money for their shareholders and

therefore deny claims and therefore the

way that they run that business is

wrong I think ultimately we've got to

kind

of have this distinction between

negligence fraud and acting on the

corporate behalf there's a there's a for

a period time all of these um

documentaries and this movement against

the idea of the corporation generally

speaking you guys remember this was like

a decade ago or 15 an capitalism

movements yeah and it's like this the

corporation Shields

individuals and the corporation creates

a shield for individuals to do harm is

kind of the argument that's made and so

there's a lot of people in this camp

that think that these all CEOs of

companies that let people down are evil

should be killed should be put in jail

whatever the awful kind of

contextualization of that is and I do

think like it's really important to

think about well if no one were to be

the CEO because they face that threat

and those companies can't make money as

a business then those Services go away

entirely that's kind of the end state of

where this goes there's going to be

these difficult situations if a CEO does

something negligent fraudulent

wrong there's a court and there's a

system and there should be kind of laws

that protect people I I don't know man

the whole thing is pretty depress

pressing to think that a guy who's the

CEO he's you know from from what I heard

guy got a family yeah I mean he's got a

family he's got a wife you people that

have known him said he was like a nice

guy and a good guy and he runs a tough

business you know insurance is a very

tough business well and to your point

about this seems like it's very

personalized with the casings if that is

in fact true again this is breaking news

so we're speculating here you hopefully

informed this chart has been the one

that's been circulating on social media

now this has now become Gavin like a raw

shock test about how you feel about

Corporate America Healthcare Etc but

United Healthcare at least according to

these charts that are speculating deny

claims at a rate at a multiple two or 3x

other people in the industry and that

they are the most hated not that any of