Brian Johnson that's so funny I I uh who

knows I am the king of nighttime

erections I go to bed thinking about

myself and I wake up thinking

myself big correction in

between let your winners

[Music]

ride we open sources to the fans and

they've just gone crazy with it queen of

all right everybody welcome back to the

number one podcast in the world man

we're starting off with three of the

four original band members shamal poopaa

he's your chairman dictator the Sultan

of science David freeberg and of course

I'm your host Jason calanis and David

saaks from the original band will be on

the second half of the show we're going

to do some of the classics yes you get

some of the classics including Ukraine

Ukraine Ukraine coming up

on the second half of the show in our

greatest hits Revival tour but with us

again sitting in The Red Throne is the

one the only Joe lale is back he is if

you can imagine further right than Keith

R boy and saaks they tell him to pump

the brakes welcome back to the program

Joe Londale how you doing brother hey

Jason doing great here in Texas today ah

yes I I see you right over the hill on

the ranch our ranches are within 20

minutes of each other Joe Lonzo and I

are shooting guns at our ranches are you

on a ranch Joe uh well I bought a bunch

of the homes and connected them so it's

kind of like a ranch but it's actually a

suburb yeah it's more like a compound he

has a compound subb

suburb that creaking sound you hear are

the libs Rolling In The Guillotines yes

he bought the small town he lives in Joe

lale's here of course he is a venture

capitalist the founder of 8vc they've

got six Billy in AUM co-founded paler

open gov in adapar 3 billion Billion

Dollar Plus companies he co-founded and

an early investor in andrel I'm in the

market for secondary shares you know how

to reach me folks if you're selling your

secondary and Andel and building a

position for obvious reasons and Oculus

wish Oscar Health amongst his other

Investments hey what was the feedback

Joe on your first appearance here on the

all-in pod people loved it you know you

guys gave me no warning so I was like on

a mobile phone sideways but it worked

out it was great everyone saw it I gu

looks like people actually watch your

show Jason it was surprising apparently

people tune in from time to time and

that's why we call it the number one

podcast in the world how are you doing

shth poopaa how you doing brother I'm

doing really

well okay once again giving me a ton to

work with there and Fred would you wait

what would you like to know why don't

you ask me a question oh well I asked

you how you're doing maybe you say oh I

had a great time with my kids I took

them to Disneyland or I don't know Chef

made an amazing aruga you used to give

me some some color to work with here so

Nat was in Rome all last week great what

was she doing in Rome

she had to go see her Factory she also

had to go and renew her visa at the US

Embassy there okay so she's renewing her

visa hopefully she'll be able to get

back in the country I know we've

tightened up the borders well she's on

an eb2 Visa she's already but she should

switch to this eb5 as soon as it's

announced oh yes you can get the golden

visa and I think you already put a down

payment on freberg how was your week

what how's everything going at ohal

you're having a productive week as one

of my management team members told me

today it's a very complex business

that's usually not a good sign when the

conversation starts with that is that a

way of saying everything's no no we we

we were good I was on the road this week

I just got back I mean it's hard running

a business is hard you hire the smartest

people you know and what happens they

bring you all the problems they can't

solve so it's it's never easy we've got

an incredible docket today let's just

start with I'll give you a quick recap

boys of the week since we last taped to

say the uh Zone was flooded in the words

of Steve Bannon would be an

understatement here's your Trump tsunami

for the week Thursday when we tape the

Epstein file dump Fiasco you remember

that Joe right big zero big nothing

burger then

Friday zalinski was dressed down and

kicked out of the White House by the

Vice President presidents markets

collapsed they rebounded on Saturday we

got a beautiful day off video of trump

dancing down a catwalk to YMCA maybe he

played played some golf he was at the

White House South Mar Lago Sunday 9:24

a.m. eastern the president pumps three

specific crypto salana Cardona xrp to be

in the first government strategic crypto

Reserve Joe ondale starts tweeting I

start tweeting everybody's tweeting he

quickly retweeted himself included

ethereum and Bitcoin some decentralized

coins reaction was wow crazy you had a

little bit of a spicy take Joe we'll get

into that later and I'm sure our friend

David saaks will have much to say in

second half of the program but it was

pretty negative Cardona ripped 70% xrp

32% salana 25% and then there was this

crazy trade one whale went 50 times long

on BTC and eth $200 million position on

just a $4 million investment everybody

trying to figure out who that was I'll

leave it to you to speculate then we

start the week Monday Trump says

significant TR tariffs with Canada and

Mexico the market collaps he walks back

tariffs couple of hours later and the

market starts to rebound then at 2:38

p.m. Trump announces a hundred billion

investment from tsmc in American Fabs

huz off for that and our boy David saaks

Gets dragged out to the podium for a

quick 15-second Cameo very nicely done

to our boy David saxs and then Tuesday

we have the most chaotic State of the

Union I've ever seen highlights include

an angry man shaking a cane and getting

kicked out there were some auction

paddles from the libs I don't know what

they were bidding on there were 13 Biden

mentions and one Pocahontas

Wednesday we have news that the Doge

Blitz might slow down Supreme Court

chimed in with a 54 decision backing the

federal judge who ordered the Trump

admin to pay out two billion for USA

contractors then there was a closo

meeting with the Senate with Elon maybe

they discussed an approval process maybe

some voting type things and then here we

are today Thursday when we're taping

Market's down 2% on more tariff news

breaking news drops at 11:30 Trump

announced are off for Mexico markets

aren't rebounding we might be leaving

NATO hold on almost almost there yeah

breaking we might be leaving NATO

breaking we're shutting down the

Department of Education psych we just

found out we're not okay gentlemen

that's the week that was no there's

there's three things that are also kind

of interwoven in all of

this open AI

dropped GPT 45 and I think it was not

really that well received I didn't even

know nobody's talking about that quen

which is the open source Alibaba dropped

to rev which seems actually really best

in class so that was really interesting

okay then there was a story that said

llama is going sideways Facebook's open

source llm yeah and then the markets

have just been going I think the

craziest I've actually seen in 20 years

of following the markets and

specifically you're seeing the mag 7

compressed towards the rest of the S&P

500 and then you're seeing this insane

trade away from Europe so there's a ton

that happened this week I mean I don't

remember a more eventful week Joe is

this a little too much maybe you guys

missed the Shalom Hamas tweet by Trump

too which for a lot of us is a big deal

he said I don't know if this is hello or

goodbye but he's threatening them really

strongly so for people who care about

that part of the world it's interesting

to watch what's going to happen so that

also happened yeah oh my lord well and

Shalom is hello and goodbye right just

to clarify as a word you would say it

both right Shalom yeah and peace

ambiguous word and

peace well maybe he's leaving it into

interpretation maybe they get to pick

maybe it's hello no that's what that's

what he wrote in the Tweet oh he did

yeah it's your choice okay it's should

Choose Your Own Adventure Hamas from the

president United States but I think we

should probably get into tariffs

this is confounding to most people maybe

since I just did the whole rundown I

won't go into all the details about tffs

again but just looking at it from first

principles Joe I asked a couple of group

chats you're in one one of them in

fact and I have about I say about 400

people total in these four group chats

what's the strategy here what do you

think Trump is trying to accomplish and

man I got a range of answers let me ask

you what is Trump in your estimation

trying to accomplish with the tariffs on

the tariffs off the Tariff on the

tariffs offs as Shou said here this is

creating more chaos than any of us have

ever seen in the markets listen Trump's

negotiating right so I I actually ran

into David saaks each Senator gets one

guest we are both guests in the Senate

dining hall hanging out with a bunch of

these guys multiple of the guests some

of them were spouses of the Senators

multiple of the guests were people who'

lost kids def fentanyl right and so this

actually is a very serious issue it's a

big thing on the populist right as it

should be for all Americans we've lost

you know tens of thousands of young

people recently to Fentanyl and and and

Canada has done nothing about their

border and so you know you just reported

breaking news I had even heard yet that

Mexico might be off can is still on he's

using this to negotiate so I talk to the

Senators and I asked him what's going on

because obviously I import things all

over the place I'd like to know what the

hell the rules are but he wants people

to actually crack down on this stuff and

save American lives and I think it's a

reasonable thing to use to negotiate and

force them to do that okay so you

believe it's negotiation because of the

fental issue Cham let me go to you

because many people are saying this has

more to do with some great reset and

maybe the tenure do you think this is

about fentol at the border or something

else I think that this is the first week

where I've seen the first real

Schism in how people are interpreting

what's actually happening I think that

Trump and Elon were very much in a

honeymoon period until this week and I

think there was the benefit of the doubt

but what I saw on X was a real

Divergence where on the one hand there

were people that were basically

saying doge is deranged Elon is crazy

Trump is lighting the world on fire in

one camp and the other Camp saying he's

sticking to the plan and when I thought

about this a little bit if you went back

to November the

5th I do think it's important to

remember that we were at this moment

where you had this fork in the

road and you had all these important

issues where I think the best way to

generalize it was that the Democrats

believed that the lines should continue

to be blurred so whether that was on

gender or race or Merit versus some

other immutable trait or fiscal and M

monetary policy things were just getting

more and more

blurred and then Trump and Elon

basically showed up and said actually we

want to refocus and we want to make the

lines very visible and clear on all

those Dimensions h and a majority of

Americans voted that

in but I think what you're starting to

see now is the difficulty in actually

implementing that

plan and what I mean specifically is

tariffs are very nuanced and complicated

on the one hand there's these short-term

wins there's these impacts you could

deem them positive or negative to the

dollar there's impacts to us bonds

there's impacts to us Bond markets

there's impacts to how countries deal

with foreign reserves and then there's

this impact that happens when the

markets react to a

tariff and then Trump takes that off the

table and then they snap back so you

have this weird set of boundary

conditions right now so I think right

now we're in the very difficult part of

sorting through what the long-term

implications are and I can get to some

of them later but I think that's where

we are I think that's really interesting

the goal of tariffs in your mind for

Trump is

fenol finance related no give me your

definitive what you think this is about

I think what tariffs allow us to do is

rebase

the long-term Reliance on the US dollar

it allows us to

rebase our ability to fund our own

deficits and it allows us to

rebase the long-term ability for

American companies to be economically

vibrant okay so freeberg we got one

person with fent all the Border

negotiating we got one person on trade

some portion of this I hear and I when I

asked in these four group chats I got

he's throwing stuff at the wall the

Border he's trolling the 10year note and

he doesn't care about stocks and then I

got onshoring and Manufacturing as a

possibility we're going to make it more

expensive to bring things in so why

don't you consider making stuff here do

you think that third possibility is

what's going on here just David freeberg

pick one of these three choices or

another what's going on here with tus

specifically I don't sit inside of

Trump's head and I don't have any direct

line of communication to folks that are

constructing the theory and the policy

if I were to say what's the most

masterful plan in an optimistic way of

what could be going on here what's the

master plan I would kind of craft it as

follows tariffs aren't being done in

isolation they're being done along with

a coordinated policy effort to reduce

income taxes and another policy effort

to reduce government spend

so those are three actions three legs on

a stool so tariffs M reduced income

taxes reduced government spending and

they are related to each other they're

related to each other because if we

increase tariffs one element of that is

that to import products is more

expensive for example I buy LED lights

in my

greenhouse and the price of the LED

lights just went up by 25% this week I

actually spoke with the CEO of an LED

company and I was like why don't you

guys make the LED here and there starts

to become a crossover point where it

actually makes economic sense for the

company to make the LEDs here instead of

sourcing them from Asia and there's a

100,000 examples of this when the

industrial supply chain goes to the

lowest part of

production it's going to end up

offshoring when there's no tariffs and

if there are tariffs then you start to

do production here so you're increasing

both kind of security for the US supply

chain but also increasing demand and

creation of a

Workforce Now I think that the income

tax piece is critical here because in

order to make the capital available to

build that industry here we need to have

unleash capital and reducing of income

taxes the economic theory would be that

Capital will now flow into these

entrepreneurial activity these

opportunities that have emerged where

suddenly it makes sense for me to make

textiles to make metals to make

materials to make cars to make all this

stuff here in the United States that I

otherwise wouldn't be making so both the

corporate and the personal income tax by

reducing it unleashes capital that

instead of going into the government it

now goes into the private sector into

building businesses okay I think that

there's another theory about this which

is as you drop the income

tax one of the kind of key theories that

I've heard spoken about a lot lately and

I think we're going to hear about it a

lot more this year is trying to get the

United States to move away from an

income taxation model to a consumption

taxation model so effectively what the

tariffs do is there's a tax for you

buying certain things so now instead of

getting taxed when when you earn money

as an individual you get taxed when you

spend money and some people think that

that's both a more fair system and a

more kind of economically vibrant system

because that will drive investment in

the things that people want to to

produce because the money's going into

production so you that do you think that

free Breg I'm curious I I don't know

it's a really interesting economic

theory I mean I am not opposed to seeing

some sort of an experiment play out

where we look at a shift from income

taxation to consumption Taxation and see

if it actually does have an effect on

economic growth and productivity it has

not been done in 150 years there's a lot

of economic theorists on both sides of

the equation saying this does work or it

doesn't work okay and let me just say

one last thing by reducing government

spending we are moving workers from the

government into the private Workforce so

as those new Industries pop up as those

Investments start to get made in

building new industry onshore where are

the workers going to come from remember

the government's 30% of the US GDP today

so if that's not a great way to invest

money maybe the Private Industry is

better at investing money in employing

people that will unleash the workforce

and it will counterbalance the inflation

that we're experiencing so there's a lot

of inflation because of tariffs and by

reducing government spending that's the

offset to inflation so those three

actions I think are three legs of a

stool and they actually are all

interrelated to one another so that

would be my grandmas theory of what

might be going on this is an interesting

triangulation theory that people have

been speculating about and there are a

couple of caveo here Joe number one we

do have lowering income tax and lowering

Services experiment it's called Florida

Texas and a couple of the states where

they have lower income tax and and more

consumption tax we pay a lot more in

real estate taxes here something we

consume putting that aside the really

interesting issue is we're at the lowest

unemployment of our lifetime 4% where

are all these workers going to come from

what do you think Joe now that you've

heard the two other panelists here

discuss it

what are we trying to get to where is

the destination at the end of this term

Trump's lame duck he can go wild here

he's not running for election and you

know what what do you think he wants to

see do you think he just wants

to sement some sort of legacy and if so

what's that Legacy and how do these

actions equal his goals and Legacy no

listen I agree with what David with what

David was saying Jason and it's it's a

really important point also that we

should mention is that the last four

years the economy's looked okay but part

of that is because government's been

hiring like mad and so the point he made

is that actually you know having twice

as many people you know harassing me I

just got back yesterday no action on an

audit that been harassing me on for

three years they found nothing having

twice as many people doing things like

that and and or like you know running

TSA or pushing papers around in the

Department of Labor doesn't actually add

output to the economy and so you know it

it does seem like it makes a lot of

sense let's take a million workers out

of the Consulting class around e DC out

of the you know paper pusher classro on

DC and let's actually deploy them to the

actual productive economy Elon and Trump

have both been saying that I think David

is 100% right and it is true a lot of my

companies thinks that the Tariff stuff

are looking to build stuff here so I'm

not a huge fan of tariffs personally but

they definitely make sense for things in

defense they definitely make sense for

negotiating with countries and it is

true it is pushing certain people to

including me to build some more things

in America here's where tariffs make a

lot of sense if you have markets where

there are domestic alternatives

Andor where things are fundamentally

commodity there's no reason why tariffs

can't work to create the incentives to

redomicile economic productivity inside

of the United States that's a that's a

slam dunk I think and and shamat there's

another Twist on that too which I think

we should all acknowledge is America

does have some really tough

environmental laws despite what Jason

may think of me I actually don't want my

daughters growing up with you messy air

messy water you know screwed up country

oh I don't think that of you I I know

that you're a nature guy you're like a

classic bush guy but but here's here's

the thing in China and Indonesia and all

these other countries they are just

shoting over the environment as they

make things I think tariffs are very

reasonable on that case like it's not

fair to make it more expensive for us

because we're doing it well and then we

Outsource it for them to destroy things

right so so there are some things there

where it does make sense and what I

would say is the other the other side of

the of the Tariff knife is that if there

are markets though where you're making

something that's fundamentally

Innovative where you are but one maker

the problematic part of where tariffs

really affect the US consumer is then

the price of that product of which there

are no competitive Alternatives can go

very very high and that's inflationary

and I think that that slows down

consumption and then if if that

consumption is not just of something

that's a nice to have but a must have

then it becomes problematic and so you

could see where tariffs could impact

certain

industries for example if there are

Innovative drugs I think that that's

problematic if there are Innovative

Technologies of which there's only one

vendor that's problematic so all of

those need to get sorted out but on

balance in commodity markets like look

at Autos Autos is a perfect example

there are so many purveyors and

providers of Autos there is oems all

around the world and so to have a

compensatory

system doesn't seem like an unreasonable

thing where it's a tit fortat tariff but

in markets where if you need for example

a specific piece of equipment from asml

to build a chip and now all of a sudden

that that machine is 25% more expensive

or 30% more expensive and they pass that

cost

Downstream it becomes very speculative

and it becomes a little bit more fragile

I think this is dangerous though right

jth because I agree with you in theory

but then there's something where you

know if everyone's lobbing for their

thing to be an exception you end up

getting this very crony system that's

that you don't necessarily want right so

you have to be very careful how you

define these things exactly so this is

why the I think like sector by sector

it's probably you can probably go and

pass the smell test and say if there are

multiple providers and or if it's

somehow

commodity I think it's easier to absorb

the Tariff in the short term maybe

that's the right way to say it which is

if you believe if Trump believes

everything should be tariffed then

instead of debating if to your point

maybe the right thing to debate is when

and you have to put things on a much

longer Glide path so that you don't just

create inflation out of nowhere and or

you don't hold back American business or

American consumers well this is a key

point because you do need to have

predictability to make investment and

reciprocity so really two important

points Shaman's making here one on

reciprocity these things haven't been

looked at for a while I'm not sure how

they got so out of whack but just

putting some facts to this uh chat's

exactly correct we get placed uh when we

send cars to the EU they they get a 10%

tariff but when we get their cars it's a

2 and a half% tariff who let it get out

of whack I'm not sure but why not make

the reciprocity perfect and just hey you

say 10 we say 10 you say two and a half

we say two and a half and that would

make I think a lot more sense just to

put some numbers here on government

employees it's not as bad as people make

it out to be a lot of our spending is

nonemployee related but it is if you

look over the last two administrations

we have added million 2 million three

employees across all I disagree and that

hold on let me just finish the sentence

so you have the facts and then you can

disagree with the facts one point3

million additional employees added this

does not include contractors and so we

don't know what USA was doing with Nos

and contractors and I think that's where

we do need to get some clarity and to

chat's point this has all got to become

predictable you cannot put tariffs on

off every week or else how does your

friend Dave who wants to do the LED

lighting or your encouraging to do LED

lighting know if they should build a

factory and invest 10 million in that

you disagree with the number of

employees you want to address that yeah

look the government accounts for 30% of

GDP in the United States that's an

extraordinary sum so just I was talking

just about the employees that's a much

smaller percentage but that doesn't

matter the direct employees of federal

agencies is a fraction of people that

are employed indirectly by government

spending this is super important as we

all know many government agencies write

checks to large contractors

subcontractors and third party service

providers that do the work for them so

the money gets transferred they then

employ the people and they do the work

so it doesn't technically show up on

federal government payroll registers but

these are people that are indirectly

employed by federal spending that's

super important to to acknowledge that a

large percentage of the US Workforce is

indirectly supported by federal dollars

yeah it's gone up it's gone up massively

with the NGS too so you've had about

four million people employed by

contractors in DC 1.6 million more at

the states actually by federal by

federal spending and then you have the

NOS no one knows the noos Biden

Administration took down the data I used

to see things in 2020 so we don't even

know how much money but we know it was

hundreds of billions so it's pretty

crazy the number one thing about how

doge is not being done fully is that

Elon is doing an amazing job you know

whether or not he cuts 500 billion or

trillion or a lot more but the Senators

and the congressmen are not willing to

take it out of their bill the

reconciliation bill right now talking

about cutting one to two trillion so

rather than like this is over 10 years

it's ridiculous it's ridiculous if it

was equal to Elon was doing it'd be at

least five trillion dollar and I've

pushed a bunch of them they say oh the

Congressional budget office and all

these things I'm sure there's some tough

things there but like this is crazy we

need to see what these Cuts need to be

on Doge and we need to cut five trillion

and none of these people have the balls

to do that is there's not the political

will to do it is my interpretation and

just no coones let me just show you one

chart to back that up I have my new disg

graciados

look at this chamama you want to talk

about software and waste

35,8 55 according to Doge breaking news

service now licenses on three products

only being used by 84 people oh my God

you kidding me

11,000 acrobat licenses with

0.0 users

disad absolutely abhorrent and I'm

saying it right now I want an

investigation into procurement who sold

this who bought it this could be a crime

this could be fraud that could be

Kickbacks I'm saying there could be I

don't think it's that but I do think you

have to look at the earnings of these

companies in question where's totally

correct number two totally correct if

service now ever wants to work with the

government again Mr

President Mr President our president I

want them to pay us back for the unused

licensees is and I want a full order for

the last 10 years if they don't pay us

back that money and give us a credit

hold on list banned forever hold on it's

not thank you Mr President this may not

be service now's fault this may be the

inaptitude of the people that bought the

LI course but they should still give us

a credit I want the money back for the

American people I do think Adobe has the

worst have you guys ever done Adobe

subscriptions they're impossible to

cancel I think Adobe 11,000 Z us only

the only thing harder than cancelling an

adobe license is trying to cancel Wall

Street Journal I was about to say Wall

Street Journal

Hall of Fame let me just say something

about the the budget because Joe brings

up something important unbelievable I'll

just say it again at the sake of being

redundant we're getting to the phase

where the details are complicated and

they now matter so we've talked about

repealing the IRA in its totality right

so that was a statement and there's

there's theoretically a lot of money

there but the details now all of a

sudden become

complicated FK published a report just

this past week and what do you think it

said was the percentage of incremental

electricity that was generated from

Renewables versus non-renewables I I'll

tell you the answer it was almost 91% in

December so if you now tie two huge

initiatives together which is how do we

find a budget that saves money and how

do we continue to win an AI maybe you

would have thought those weren't related

well guess what

we know that AI needs a tremendous

amount of power and whatever you thought

you knew actually you had to reer right

because what Elon has shown is actually

you need to now create these Mega

clusters 100,000 gpus going to a million

gpus all of the Power forecasting that

we have is miscast it doesn't even

account for this number one number two

there are 35,000

applications into

FK to get approved to generate

electricity 35,000 that's going to

meander through some administrative

rigu there is a 5year delay to get a gas

turbine into America and

online okay if you ordered one today the

fastest that you can get it turned on is

2030 the fastest that you can get a

nuclear turned on is

2035 so we don't have the ability to

generate incremental electricity very

quickly but for Renewables but then if

you rip out the IRA there's many parts

of the IRA by the way that are just

trash Nick I don't know if you can find

it but Barry Weiss found this insane

thing that made me so angry which I'm

happy to talk about which was like a

30-day Grant process that resulted in A7

billion Grant to some shell oh this was

throwing the gold bars off the castle

but but the other part of the IRA this

narrow part is what it did to reinforce

tax incentives and tax equity which is a

200 billion

Market that incentivizes that 90% of

energy generation so my point is that

when you start to get into the details

when the house Ways and Means Community

has to figure out what part to put back

this is going to be hard because it's

like hold on if you got the whole thing

now all of a sudden you take 90% of the

incremental energy generation incentives

out of the market you don't have enough

electrons there isn't enough electricity

so then you lose the AI Ray so you start

to lose it I think the point is that

we're now in the hard part where the

details really matter listen you got to

start with the chainsaw we saw that at

Twitter and by the way maybe you do like

when we started this he just tweeted

this out he said guys now it's time to

get surgical he and he said this per yes

that was the metaphor I was about to use

is like you know you start with you cut

out the goddamn service now in Adobe

subscriptions and then you work on

something you know more DEA and maybe

that's where we are IR just for the

audience inflation reduction can I just

do a rant on this on this pop-up NGO

thing to me this is like the worst of

America and it makes me so angry and

I'll tell you my lived experience so I'm

on the other side of this I started a

company with these guys from Tesla to

make battery materials in the United

States in

2019 we grind we grind we put in tens I

put in tens of millions of dollars we

get a deal with a big

OEM and then you see these doe grants we

spent millions of dollars we file a very

detailed plan to build battery medals

and battery capacity in

America we got rejected okay it was an

entire yearlong process we got rejected

we put it past us we kept working we

found more deals we found a way to

survive raise a little bit more money

and then we applied again on some

success and we got a $100 million Grant

okay that was that's what just happened

this year but then yesterday I read and

Nick maybe you can throw this tweet up

this Barry Weiss investigation

somebody in 30 days who was connected to

the Democratic infrastructure had some

shell organization that got a grant that

was 70 times bigger than us like we've

made stuff we have deals with

oems we had to validate every step of

the way we were rejected once so our

process to get a $100 million doe

program was two years these people

showed up in 30 days and got seven

billion that's just wrong why didn't you

put why didn't you lead with Dei or

something you would have gotten a

billion you just LED with the wrong

thing you were actually providing a

product or service people need this is

this this is why you don't have any

equity in there for the minerals this is

why it's so frustrating to build for the

government guys this is what paler and

SpaceX had to deal with that's why they

both sued the government is that all the

friends who used to be the CIO used to

be the general made the right donations

had the right kid on the board it's all

corrupt and then the actual substantive

people you have to work like how do they

give $7 billion in 30 days we're gonna

find out you got a bunch of democra

operatives on the board let well let me

challenge you guys on one point there

are now claims being made by reporters

and by Third parties that are saying it

is a new form of

kleptocracy with all the friends of

Silicon Valley installing their friends

and agency heads as under secretaries

and so on that's going to benefit

Silicon Valley investors Silicon Valley

companies Joe jamath Jal I mean how do

you guys react the claims that there's

now you know this new kind of

kleptocratic movement it's the old guard

is gone new guard you have paler you

have andreil so go ahead you you answer

let's let's talk about this I mean when

we go to DC when I go to DC what I am

asking is I want there to be a Fair

competition and if I win I want my

company to actually be able to win the

contract because the way it's worked for

20 years like like epis you just raised

$250 million this week it's a great

company we you know we had a big contest

four years ago L3 rathon northr these

guys you know in and out of government

for decades they've they've gotten tens

of billions of dollars to the same

technology area when we went

head-to-head with them we we didn't just

like beat them by a little bit we shot

down the hardened drones nine and a half

times farther away same size same power

nine and a half times completely wiped

the floor what was the cost difference

between the bids like are you saving us

massive money massive money I invested

only 30 40 in the whole thing at that

point and they spent billions and we

have much cheaper much better not even a

question and and you talk to the and you

talk to like at the time the the chief

of staff of the Air Force the guy run

the four star and and he says well Joe

this was written three years ago it

looks like rathon probably did help

write it and they required all these

things and your way you're doing it I'm

like I I'm like yeah I'm using a chip

instead of a cathod ray tube that's why

it's working so much better like yeah

but it was written for the way they're

doing it and I could overrule it but it

break a lot of glass so you probably

wouldn't get in three years because

everyone knows you're the best but it's

too it's too frust you know it's too

stressful to give it to you right now

like that is that so so so what I'm

doing is I'm not going and saying give

my company's money I'm saying I'm saying

make this actually a functional logical

process and give me a chance to win it

from the best and that that is a hundred

times better for our country to push how

do you but how do you make that

transparent and how do you avoid there

has to be massive transparency how do

you avoid the the perception of conflict

and the perception of kleptocracy well

it's acquisition it's acquisition reform

right so like this this a really

important story you guys probably know

we were in the Philippine jungles in the

early 1910s needed new pistols our

pistols were terrible they had like a

one-page thing what they needed there's

six arm manufacturers competed that's

how we got the Colt 1911 in like three

months it won by the by by a large

amount it's an awesome gun uh 12 years

ago we had a 700 something page document

that the bureaucrats spent years on

outling what they needed for a new

pistol or probably needed to do Dei

stuff I have no idea it's like this long

comical document they still don't have a

new pistol today and so the way the way

we do it is we have a very clear process

where it's very specific on the outcomes

not on the inputs and you have a contest

and and then and then you make sure that

you know it's not it's obvious who wins

guys it's not like we're like slightly

better it's like we're shaming them so

the only way they can stop us is by

playing these games so much

better I think that if you're in the

administration or if you join some part

of the administration whether you're a

full-time employee or a gsse or just a

volunteer there's going to be that

perception of impropriety or influence

pedaling that's comes with the territory

so how do you avoid it and I think that

Joe is exactly right when the

administration was getting formed one of

the things that happened I had an

opportunity to work with some of the

folks to write some proposals for what

theoretically could happen in some of

these bigger government organizations

where there's just huge pockets of spend

and where I spent most of my time is

what Joe talked about how do you create

Open Standards so that it's very clear

what the competition is so that the

rules on the ground can't get

manipulated by people who are rolling

out of government into private industry

or somebody has a very deep relationship

because of lobbying those are the things

that pervert the clarity of what should

happen because then what happens can be

far a field to that so number one is I

think knowing that this time around a

different class of people are going to

be seen on the quote unquote popular

side it's really critical that all of us

that are involved in this promote

extremely transparent Open Standards

publish every RFP publish every spec

publish every evaluation criteria make

these things as mean itic as possible so

for example if you're going to go and

field a drone there's an incredibly

detailed set of data that you should be

publishing in it's not dissimilar to how

an FAA asks for flight test data and you

should be able to review that so that

then it can be escalated so that if

somebody then gets a deal because of

preference and you think you're

structurally better on the data there

needs to be an escalation and a release

valve that says hold on this is just

being manipulated and I think that's you

fight back yeah on not just this version

of a potential Winning Side versus

losing side but forever in the future

the government should be open the

government should be transparent and

every single point at which they're

making a decision and giving money

should be measurable and known you guys

got exactly right there's

transparency there's oversight obviously

but there's whistleblowers as well and

there's the role of the press in all of

this to sort of fact check it and to

check in on it as a safeguard with the

public getting engaged and that's one of

the great things that Doge has done by

having a Twitter handle I can pull up

hey here's what's going on with these

licenses and make an example so that

kind of transparency helps and then

finally we have to look at campaign

finance that is where a lot of the

appearance of proprietary exists go back

to this other thing because that's a

super important Point like it just

occurred to me that if what you said

happens then look the incentive today in

America is to try to position oneself to

have one of these

roles and the reason is because David of

what you said there is the chance to

then preferentially nudge an opportunity

your way right yes why do people sit on

committees why do people

volunteer at least at that level and if

you introduce Open Standards then the

real incentive to want to go do this

should be because you actually are

patriotic and want to just help so chth

I think I think you're right about the

standards but I want push back on the

incentive today like I know a lot of the

people who are getting into this and I

really do think they're there to fight

for the country I don't just say this

like as like you know naively or

something like these people really are

there for the right reasons for the most

part no I know I'm just saying generally

over like the last 50 years if you look

at people there is this implied sense

like for example like Goldman Sachs had

a direct line to become treasury

secretary if you were the CEO of Goldman

You' you were the treasury secretary now

don't you think that that was discussed

amongst Partners at Goldman and and do

we not think on the margins that that

beneficially helped Goldman of course it

did we'd be we'd be naive to think

otherwise my my point is not that my

point is just that going forward the

best thing all of our friends could do

is just make it all open source and Open

Standards that would be an incredible

artifact I think for America Joe I think

you telling us hey I trust these people

they're our friends you know that works

with all of us because yes we know them

we know they're going to do the standup

right thing and if you already have a

ton of money like some incremental

amount of money is not going to move the

needle for you it's it's farsal for us

to think that David Sachs is going to

give up four years of income producing

have to sell all his positions and that

is in some way good for his balance

sheet it is not he's going to miss out

on four years of AI and the massive

runup of our lifetime in order to serve

the country but I can tell you people

don't believe that just like you know

you talked about the kleptocracy and the

revolving door to raon or whoever that

people have talked about forever what

you need is whistleblower protections

journalists going after this like Barry

Weiss is doing old school journalism

investigative The Whistleblower laws are

great in our country we need to keep

reinforcing those but I'm going to go

back to we need to limit campaign

contributions we have to get rid of

super packs because these create the

appearance of impropriety and the

appearance of impropriety with Trump's

mean coin and that announcement on

Sunday for the crypto Reserve was you

know it doesn't help the mission here

that Trump is trying to get done so so

maybe you could speak to that because

that's where the appearance of

impropriety is great you got people like

Sor who's doing his Bitcoin thing he's

going on Friday and you know sax will do

a do a little bit here and announce some

stuff on the program hopefully but maybe

you could talk about what you objected

to with the coins the meme coin Endor

the the announcement of the crypto

Reserve should our government and after

all this donations from massive people

like I saw at the crypto ball all the

people who were tweeted by Trump that

looks terrible you tell me what you

think I agree with you on the Tweet

you're sneaking two things together here

though so I want to be really precise

Jason because let's be precise that's

what we do here there are a lot of

different possible ways that people can

help politicians and so one of them is

if you're a celebrity like even all your

guys show at this point you can you can

affect what people think that's powerful

more there's there's other ways that if

you're part of a big Union if you're

part of a government Union that's very

powerful you know in our society if

you're part of the American Medical

Association Healthcare System that the

doctors and health systems are very

powerful even without super packs in our

society and what a Super PAC is it's a

former free speech and it's true wealthy

people have the ability to influence

things through that speech but it's like

one of many and so if you're cutting

that you're basically saying okay I

don't want Elon and Joe to have as much

say there but I do want to have even

more say for the celebrities and for the

doctors and for the union members and

government so you have to realize you're

dealing with a complicated situation

with lots of forms of power I do agree

with you as I said listen I saw David

and gave each other a hug I think we're

all good but I was very frustrated with

the posts of trump mentioning specific

coins I don't know who was trading them

before it just looks bad like we're

fighting all this grift doing all these

things where we have the moral High

Ground I agree I don't want to give up

the moral High ground with these with

these silly schemes that that that's

100% the case are you saying with like

there's many forms of influence that you

think Super packs and rich people should

be able to I think speech is important

$50 million $2 million donations you

actually think that's fair for democracy

I actually I actually think speech is

very important I think the ability for

me to send out something is say guys I'm

studying this it's corrupt it's been

corrupt for 50 years we have to all get

together and stand against these Health

Systems these crazy defense companies

that have captured and broken everything

like I I think my ability to speak and

do that and to convince people is really

valuable and I and I've you know I

passed dozens of laws each year into

these different states by convincing

people nothing to do with making me

money that these incentives and

accountability are wrong I think that's

a good thing that I'm allowed to do that

should be so when you say speech you

write a check you mean write very large

checks you have to be careful that the

reason the Supreme Court ruled for super

packs is not just about giving you're

not you're not giving them the money

you're actually speaking yourself so

when Elon spends $300 million he's

actually spending it many times putting

out his own speech or he's putting out

what about you Jamal do you think that

Soros Elon let's take the names out of

it do you think there should be a cap on

what you're able to donate to Super Pacs

because this does create the massive

appearance of impropriety whether it's

in Crypt

whether it's on the you know Soros on

the Democrat side this seems to be I

mean I I'm in favor of there being more

hard caps whether it's 510 or 25 million

I think there needs to be caps and I

think we should put a fund together for

the last two or three people and let

them get that money from the government

to run their campaigns like other

countries do I think it's important to

note that this pendulum

has swung pretty wildly out of wax in

citizens united yeah and it's not this

is not a republic thing meaning there's

a whole buch of factions there's the

George Soros faction that's true there's

the liberal Democrat faction L we forget

I think Zuck spent 350 million in 2020

oh yeah then there's the kooch brothers

faction and then there's what showed up

this year with Elon so my point is

there's all kinds of pockets of spending

in all manner of ways I think the

question is should citizens united have

allowed this kind of spending and are we

better off as a democracy for it and I

think what does shamat think the reason

why I would be in favor of going back to

the way it was is that I think the

biggest problem is the redistricting and

the jury mandering that happens and the

amount of influence that happens

Downstream inside of state and local

elections and there are just places that

are just so sclerotic

stuck if you look at the federal despite

all the spending you still see at the

presidential level like pretty

reasonable and healthy competition

between two people it's much more

difficult to see dynamism lower and

lower down ballot and so the reason to

get rid of citizens united from my

perspective is that you'd have much more

vibrant local state mayoral elections

those things have huge impacts I think

to to Quality okay so you and I are in

that camp Joe's in the other freeberg

your thoughts you're the desire vote

here it's two to one in terms of the

panel well you just said to me you you

just said to me you think we should go

back the Supreme Court's on my side so

you guys are in trouble no no yeah I

mean but the point of this program

sometimes is not just to is to take

ownership of your opinion and defend it

so I we have I want to see people own it

here in the discourse or freeberg you

can say pass but you don't get to say

nothing okay what does it mean to spend

money on on a political point of view

exactly what does it mean it it means

you can put a book I mean the other side

wanted to censor books because like like

if I want if I want to pay someone to

make a book for me if I want to pay

someone if I want to pay 50 people to go

and engage the community so I can get

some leverage on my time if I want to

pay someone to make a website to promote

my point of view on something I should

be able to do that and if my point of

view is related to a vote that Congress

might be taking or is related to a

candidate that's running for election or

is related to taxes or is related to

some other social issue I don't know how

you can kind of very clearly delineate

the difference between some kind of

political party or some political

candidate versus my having a point of

view on an issue if I care very deeply

about animal Weare which I do and if I

had enough money that I felt like I

could spend that money to influence

people's point of view you to improve

Animal Welfare through laws and through

candidates I would spend that money and

I should have a right to do so and I

shouldn't feel restricted that I can't

go publicly express my voice make

websites put up Billboards put up

posters buy ads and papers telling

people how wrong it is the way we treat

animals and slaughter them and keep them

living for their very short lives in

Terrorist conditions I want to be able

to express that point of view and so I

kind of Veer to this idea can I ask you

a question would you do you think that

your money spending if the balance of

power to get your view was

to redistrict

certain places so that then you could

get a majority of people that were

ideologically aligned to you elected

would you do that as well forget there's

no ads running this is about a different

form of electoral influence would you do

that so not spending money you're saying

like I'm not spending money to you you'd

spend money but it's not for ads it's

not for how does that work how do you

spend money to redistrict you get

certain people elected by Trucking

people out to vote and then you get that

person to join a coalition that then

redistricts I mean maybe Trucking people

out to vote as an action should be

illegal that seems pretty reasonable to

me well yeah I mean to your point

freeberg you asked like how do you

define it what I'm trying to point out

to you is for every dollar that goes

into politics I think it's I would ask

you guys to just suspend belief that

100% of that goes to ads no no what I'm

trying to say is I would say a very

small not a very small 10 10 10 to 20

cents goes to ads 80% goes to all kinds

of shady stuff and this also canvas by

the way you call it Shady but I would

argue like what if I want to make a

bunch of websites what if I want to make

like you know have people go out and

express the point of view in the Town

Square you know like there are other

aspects of what you might what I'm

saying that's fine that's in the 10 cent

bucket the 80 cents what I'm trying to

tell you explicitly is how it's spent

today is not in the ways that you think

I think that the fact that someone calls

it Shady might be because they disagree

with my point of view and if they agree

with my point of view they might not

call I think I think the tactics today

look I play with the conditions on the

field but if you look at them meaning

like using dollar incentives to

incentivize people that's allowed today

you can pay people to vote today before

we had pay them to join a super pack or

something like that but let hold on let

me let me just get Joe involved here so

Joe you heard freeberg you're kind of in

alignment I think broadly yeah but we

can Define some very specific things

that are obviously political like the

window of when you spend the money like

telling people well because you could

say say in the six

in I'm not tarting a specific vote I get

it I get it if you're not if you're

targeting an issue that's one thing but

when you tell people she's for they them

he's for you that's clearly a political

ad now you could take those ads you

could take canvasing you could Define a

subset of behaviors and you could say

you can raise up to this amount of money

per person in that way that's me those

things are explicitly political when you

tell people this is about candidate a

versus candidate B if you were say this

we're not going to mention any

candidates but we're going to talk about

your puppies and you trying to increase

your Q score here on the goddamn pod by

Saving puppies don't be Animal Welfare

is a up issue and something you

to be agreement with you I just don't

like how many points you're scoring with

the audience over did you guys see this

thing on Instagram my wife show

ridiculous I'm Gonna Save five puppies

for my Ranch somebody save some cows did

you guys see this Instagram reel my wife

showed it to me it's like of a of a calf

chasing a dog and it cuts to this Asian

guy and he's like what's the big deal

here what are we talking about like you

know you want us to not eat everything

blah blah blah and then he realizes that

they're talking about the dog versus the

the cat don't trigger freeberg don't do

that leave freeberg freeberg I got 33

ACR of paradise don't laugh I got 33

Acres patus I'm going to save every

animal in in Central Texas I'm gonna eat

them and I and I would give you money to

do that got a deal actually I I actually

I agree with what jamath was saying

about Jerry mandering I think we could

use AI for that's a separate

conversation it's it's discussing how it

works right now however Jason the

problem at the end of the day with

defining what's political or not is the

boundary cases are really tough and you

do end up needing effectively

effectively a censorship word example is

I write I write a book about the dangers

of Communism and it explains how it's

linked to things going on today and I

like give it out at like all these

people are gonna be voting I mean

there's just so many boundary cases said

you can spend up to 10 million a year

doing political activity 10 million a

year gives you a cap so you can only

B this is not political activity it's my

art this is this is an artistic piece

but when you put the book in and say

vote for Biden then we would say okay

you put a vote for B you see what I'm

saying though it becomes it becomes

really complicated I just ran it through

grock and what the answer was is that

56% of all the spending happens to be on

ads and 44% of all dollars in 24 25 was

spent on other yeah so there you put

canvasing in there I bet you it's 75% so

if we just say for those two activities

put a hard cap on them I would be for

that but let's keep going we got a bunch

of about the market Market's let's talk

about cor weave all right gentlemen we

can't talk about politics all day as

exciting as it is let's talk about this

cor weave IPO if you don't know cor

weave is part of a new type of

infrastructure provider called neocloud

it's a fancy way of saying using gpus to

build data

centers this is a really interesting

company because they got on to gpus

early and they had a lock in on a large

number of nvidia's gpus they've uh got

32 data centers with 250,000 Nvidia gpus

as an example when Elon built the

largest fastest uh data center Colossus

that was 100,000 so this is you know

really really a big company they're

going to do an IPO analysts are

estimating they're going to raise at

least 3.5 billion at over $30 billion

doar their secondary was 23 billion in

November of 2024 so this is cooking with

oil they've got incredible Revenue by

the way 1.9 billion in 2024 but if you

look at two years ago how much revenue

they have the growth is amazing Nick put

a chart in here and post because uh it's

like a 10x I think each year or

something crazy like that when I talked

about it on the other pod but they're

very unprofitable almost a billion

dollars in loss in

2024 and that's interest payments on a

lot of their debt almost 8 billion in

debt huge debt load to buy all these

gpus and that has been the question

we've been talking about here trth is

are these gpus are these neoc clouds

fancy way of saying I'll give you couple

factoids about cor which I find super

impressive so the first question is like

you would say why didn't

AWS gcp and azour eat these guys for

breakfast lunch and dinner and as it

turns out they had one very specific

technical decision that I think was

extremely valuable which is that these

guys did not use hypervisors explain

what that is so a hypervisor is

basically a middle Weare layer of

software that allows you to

abstract units of compute so that then

you can make them available and instead

they basically allowed you to write to

the bare metal and this very native

approach that allowed them to get a lot

of traction so it's a really interesting

thing to note that just that simple

thing like one simple technical design

decision can allow you to build what

looks like at least from the revenue

perspective an incredible business right

so kudos to them super awesome to see

that you can still maneuver around the

big giants I think that that's cool I

think the big question with cor weave is

what is the period of amortization and

the useful life of these gpus from

Nvidia and I think that that question is

up in the air as you said Jason a lot of

their losses are these interest

payments and as long as that they have

that calculated right in their models

that they Ed to borrow all this money to

buy all these gpus from Nvidia this is

going to be a Killer Business to the

extent that they got that calculation

wrong meaning we thought the useful life

was 10 years but it turned out to be

five this business is deeply underwater

so I think that that's the bet the bet

is they've built an amount of Headway

they're going to continue to do this

good technical engineering

but the other side of it is is the

useful life right is the technology

curve right is Moore's law and all these

other things will they work in its favor

or against it and I think that's Jo

people say useful lifespan gpus three to

five years before the next generation is

so much more powerful especially in

relation to power consumption that it's

worth running it now with servers old

CPUs for running Facebook it's a totally

different story you can keep those

running five to seven years before it's

not running them you have to turn them

off what do you think here bus you're

right there's an economic question on

the power and all these things I

actually know Brandon he lives nearby me

in my house in Montana he's a really

smart guy and I think the really

interesting thing you know when they

built this that I think is relevant

going forward is these guys were

Commodities Traders and they were

originally buying stuff to like mine

Bitcoin other stuff like that and they

realized as Commodities Traders there's

like a certain supply and demand in the

market of GPU chips but also of all the

data centers by the way and it's really

it's really interesting what they did is

they locked down the full supply of tons

of data centers tons of the power they

needed tons of the chips and they're

very very thoughtful I mean they're

effectively they're Traders and they're

and they're very economic and they have

I think they have bottled this stuff

well that explains the technical

decision because they have to have very

low latency throughput in order to

transact efficiently as Commodities

Traders I'm guessing there is one heel

here for this company Friedberg they had

massive Revenue growth but they have a

dependency 60% of the revenue now from

Microsoft and Microsoft seems to have

done this either it's unclear but maybe

to service the open AI deal where they

needed to give them a bunch of

infrastructure or it might be for Azure

it's unclear people have been asking

this question for a couple of years now

but what do you think of a business with

one client with 60% dependency and this

is how these things work Jason is they

just one client tends to grow really

really fast and they they're actually

you know so they do this orchestration

framework called sunk I know a little

bit about it this like really easy for

scheduling workflows and batches and all

these things that I think a lot of other

people are using really well they've

just bought weights and biases right

which like everyone uses basically

that's a great buyes they're killer for

training I mean I think these guys

crushing training saell said that

Microsoft was doing this maybe not for a

long-term usage so freeberg your

thoughts on Cor

weave I'm not as deep as you guys are I

remember in

2003 I worked for nine months at a

private Equity Firm and I would cold

call like companies that hadn't raised

Venture Capital that were profitable and

growing and see if they would take our

money that's the business model and I

spent a lot of time in the sector of

businesses that were called speed

doublers I don't know if you guys

remember these companies 2003 was before

we all had broadband internet so we were

a lot of people were using dialup and

you could pay $9.99 a month for a speed

doubler and what it would do is it would

basically on your browser set the server

to be their server and they had a cache

of many of the popular sites on the

internet so when you started browsing

the internet on your computer everything

loaded faster because they had really

fast servers and you got these cashes

and these companies dude they were doing

like tens of millions of Revenue high

margin 50% plus ebit margin and growing

like 100% plus a year and I remember we

we spent a bunch of time looking at

these companies this is right before I

joined Google and I was like this feels

like a transitory business it's like an

Arbitrage between where we were and

where we're going and that's what ended

up happening many of them just cash

flowed out the founders took money they

were able to get a really smart private

Equity recap done get some money out and

run at some low multiple of EA or

something and so I worry a little bit

about a business like this where there's

four or five companies that are each

doing 80 billion dollar of capex this

year to create infrastructure that

effectively starts to replace what these

guys are effectively offering out as a

service that would be my biggest kind if

I was to do diligence on this business

that's where I would spend a lot of my

time is like guys what's the capacity

going to be in a year two sort like when

Broadband hit the internet you didn't

need speed doublers anymore do you

really need to be paying as much as you

are today is there going to be as much

demand how much is this going to get

bundled in with gcp or AWS and so on in

the future so that would be my kind of

macro hesitation and caution on the

diligence as I ran my diligence on this

thing you basically need an economist to

map this all out it's the same question

for data centers in a related way right

which you just need to map everything

and I I don't have those D those numbers

so you're right it's a hard thing to

figure out that's right that's right

well the founders have control of the

company I they

sold few they sold a lot maybe it's 150

each or yeah but but they've kept most

of their position they're smart guys so

let's see yeah they still own the

majority I don't know so I don't want to

speak negatively about the business and

I haven't spent much time on it but I

mean I think that the worst that can

happen if you speak negatively about

somebody's business you know you tell us

you us Prof for years you tell us no

idea what is it like to be on somebody's

list for a decade I don't know I mean

the ratings keep going up for this week

and startups all in so I'll I'll take it

shout out are you purposefully starting

to dress up Jal by the way because I

notice every week now you're wearing a

butt I had a speak I had a speaking gig

but my friends at

Eton reached out to me so I might be

trying to do a little gri right now are

you plugging right now Laura Piana

hasn't reached out but Eton shirts which

I'm wearing right now e n you know the

famous uh shirt people are they've been

reaching out and I also no no no no I

got but I'm also saying Tom for's people

reached out and said you know that

pelvin you can take that off if you want

we'll have somebody come over so I just

want to shout out my friends over there

I have noal deal out the Kon k i t o n

jackets I've been wearing k i

o jackets on Earth I wear them all the

time I love those jackets just saying

let's move on way yes and Joe lale's

outfits are done by the Wagers the weers

in China he gets them specifically made

for $17 each recently I was recently

sponsored by a company this this service

is incredible what they do is when

you're

flying they they meet you at the FBO and

they take your watch and they they set

the new time for you so especially if

it's a mechanical watch is a very

complicated oh this is very important

right I you know what I was fly you got

to be kidding me that this

exists and I had my watch collection and

they did this for me when I was flying

between Montenegro and maltas absolutely

just trolling I'm just trolling this is

like for spy villains telling you how to

look at the world we should get rid of

income tax I'm sure everybody listening

like hm really convenient no income tax

for the billionaires and sent to

millionaires good job guys all right

let's keep going down

the all right jamat you know we've been

going back and forth in the group chat

and you've been talking about it

publicly maybe Main Street versus Wall

Street and what's going on in the

markets here because there's EU uh Bond

issues we obviously uh it seems like in

some ways maybe the Trump campaign is

not thinking about the stock market as

much as are thinking about the bond

market explain to us your take on

markets right

now yeah I think that there's three

markets that are important there's the

US long end of the curve so this is the

10year bond yield I think then there's

the US Equity market and then the most

next important Market are the

European Bond and Equity markets

together and I'll explain why in a

second but just on the first view I I

mentioned this before but I really do

think we're in a secular shift

where I think the Maga

majority and the base of people that can

be a reliable voting Block in the future

as I've said before are working in

Middle Class folks that don't

necessarily own a ton of stocks nor do

they own homes of which there's a lot

second cohort are people that are

pro-innovation and Protek and the third

are patriotic business owners I think

that cohort is very large and I think

that

when the core strategist inside of Maga

figure this out one of the big takeaways

is that they're not going to care about

the stock market in Wall Street and a

lot of the policies will be viewed

through the lens of Main Street and I

think that you started to see this

rhetoric now one from bessent and we'll

play this clip in a second and the

second was just today from Trump himself

but Nick do you want to play the best

clip if you have it I think o over the

the medium term which is what we're

focused on it's a focus on Main Street

wall Street's done Great Wall Street can

continue to do fine uh but we have a

focus on small business and the

consumers so we are going to rebalance

the economy we're going to bring

manufacturing jobs home that was the

first one the second one was just today

Nick I sent it to you do you want to

just show it to these guys which I think

is really interesting so it says here

breaking news from I guess on usual well

else Trump has just said he's not

looking at the stock market okay so not

sure I believe that but okay so why is

this actually valuable well if we are

incentivized if the government of

America is incentivized to implement

policies that crack the equity markets

it's actually really good in some ways

number one is if you deflate asset

prices you also deflate

inflation okay and give an example there

for the audience so we make it clear

Nvidia is ripping at all-time highs you

are like oh wow I'm so cashr you can go

get a margin loan you take that money

you reinvest it in a second home and a

third home you sell some stock you start

to buy cars all this other stuff it

drives consumptive behavior that on the

margin isn't there if the markets were

much much lower than this so if you

rebase the

equity values that people have what you

do is you actually depress the amount of

free cash flow that they have to spend

on other things so it's a deflationary

tactic how the bond market reacts to

that is if the stock market goes down is

you start to become a flight to Quality

right oh my gosh there's volatility in

the stock market oh my gosh I don't want

to deal with the stock market going down

let me just sell take some chips off the

table and buy 10e bonds when you buy the

bonds the interest rate goes down why is

that good for America we have1 trillion

dollar we need to go out and borrow in

the next 9 months

and so if we can pay 3% 3.8%

4% we save us ourselves trillions of

dollars versus if we had to pay four and

a half five five and a half% so that's

the second

thing and then the third thing is that

right now what we had this week because

of the Ukraine and zalinsky thing is

basically Trump say we are totally risk

off this war and I'm not going to debate

whether that's right or wrong but that's

what he said we're going to curil the

aid we're not even going to share

intelligence they're on their own what

did that Force what happened this week

was the Europeans had to basically

circle the wagons and they said okay

we're going to step up and what they

announced was a four-year plan to borrow

money to invest in

defense what they also did which was

really interesting is the UK

specifically said we're going to borrow

it in this clever little way this is

their interpretation so that it doesn't

actually count in the debt to GDP

calculations of my country so they're

start they're

starting but then so then how did the

bond market react to it Nick you can

show it they're like you know what guys

if you want to fight this war obviously

you're allowed to do whatever you want

but the cost that you're going to have

to pay is going to go up this has been

going up every day and you're at a point

now where this is severe fiscal pressure

on these governments I do not know how

they sustain their deficits and raise

more debt so all of this is happening

all at the same time I think Trump is

pro Main Street Equity markets basically

do not get bid the bond markets respond

positively yields go down good for

America they extract themselves from

spending programs like again it's more

than a spending program but I'll just

say it in this context narrowly Russia

Ukraine is a spending program that that

if you take off the table that balance

of responsibility goes to Europe and

then the markets are saying this is not

right we want this war to end and we're

going to make it more expensive for you

to litigate it if you put it all

together it's a really interesting

moment in the markets I haven't seen in

a very long time Joe do you think this

is the refinancing of our debt is the

end game here there's like maybe 10% of

people who seem to have fallen in that

camp when I queried on these four group

chats hey you know if we can depress

everything we lower consumption we break

inflation even more maybe people lose

their jobs you know less

consumption and rates go down we have to

cut rates three or four times put

pressure on the FED then we can maybe

refinance our debt which is coming up

some percentage of it what do you think

of that theory you know Jason jamaat has

a lot of interesting thoughts here and I

think it's I think it's a very smart

analysis I'm not fully aligned it is

true Bond markets hate war war is

expensive or is inflationary it's very

clear Europe is going through okay you

know war is more likely for us to spend

money that and that hurts them you know

in the US I think the number one thing

that Scott Besson and Trump would want

around this is is to fight for Main

Street like they said that that really

is you know the kind of populace energy

we have right now and so I think they

are focused on lower interest rates

lower interest rates you know I have

some someone who works with me uh their

spouse you know as a real estate agent

and that they're having a really tough

couple years because indust R spiked up

if you get IND rates down again there's

so many different places in America

where people start making money again

with with the title companies with the

Brokers with there's so many things that

happen right with that trickle down yeah

it's it's well it's not just trickle

down it's like this is the part of the

economy that that just really does start

to turn on and certain transactions can

happen again and and you're right it it

is cheaper debt that is that is

Advantage as well so I think

disinflation is very important and I

think we have to find some way to get

there chth may be right that it's worth

hitting assets to get to this inflation

that's something that the Scott could be

working on because of all the debt but