America, you need to appreciate

government before you start [ __ ]

yourself.

>> Hi everyone, this is Pivot from New York

Magazine and the Vox Media Podcast

Network. I'm Kara Swisher.

>> And I'm Scott Galloway.

>> We've got a lot to get to today, so

let's dig in. First, Scott, I'm going to

start testing my co-host testosterone

levels.

>> It's very low. [clears throat] It's very

low.

>> don't make metrics that high, baby.

>> That low is what you're saying, is what

you meant. I feel like I need to do that

now. Defense Secretary Pete Hegseth says

the military will begin annual

testosterone screenings for service

members age 30 or older with voluntary

testing for younger troops. Service

members found to have low testosterone

will be offered voluntary hormone

replacement therapy as part of the new

program. I didn't know they did

gender-affirming care. I thought they

were against that. Let's listen to clip

from this bizarre announcement.

>> This initiative, it's not about

artificial enhancement.

It's about restoring and optimizing your

natural capabilities, protecting your

longevity, and ensuring you have the

biological foundation required to

sustain the fight.

>> Well, now we know he's on T. You know,

let me let you run with this. You have

taken You take testosterone. You've

talked about it.

Why is he doing this? Explain. Explain

Make the good case for it, I guess.

Or not.

>> Well, I mean, it if part of

if part of health care coverage is like

I'm on testosterone cuz I think it's

good for my brain and my heart health.

And it makes quite frankly it just makes

me feel younger. Weird things like I

don't have to pee as often. Um

and my doctor said we're not going to

take you You know, you don't want to I'm

not using it to be a monster or more

aggressive. I'm using it cuz I want to

quite frankly feel 45 again and hormone

replacement therapy is something that I

think

you know, under a doctor's supervision

for men and women in their 50s

>> Yeah, I take I take hormone replacement

therapy.

>> Yeah, I I think it's

I think it's a can be a real value add

under the supervision of a doctor, but

this is just performative s-

uh in my opinion stupidity. I mean,

young men don't have or our military and

men don't have a testosterone problem.

It We have a loneliness problem. Young

men are falling behind because they

aren't low on testosterone, they're

falling behind because they're low on

purpose, education, work, and

relationships, and we're having trouble

finding, although actually recruitment

is up this year, we're having trouble

finding 70% of people. Remember how

joining the army used to be the the

option of last resort?

>> Yeah.

>> 70% of men that walk into a recruiting

office right now for the armed services

don't qualify because of obesity or

mental health problems.

>> Right.

>> So, if you if you want a if you want a

more lethal fighting force, we need to

make more investments

>> Yeah.

>> in young men, and it's not about pumping

them full of testosterone.

>> I know, it seems strange.

>> is just performative stupidity. He

conflates this weird notion of

masculinity and fitness and optics

with or doing bad pull-ups. Our military

is headed towards asymmetric war. You

know who's going to have the best You're

you're going to have the most lethal

fighting forces will be the ones that

master AI, asymmetric drone

capabilities, really good management,

ability to attract the best and

brightest, and have special forces of

just out of [ __ ] control, brave, and

smart, and strong people.

>> Right.

>> But, those people are in their 20s, and

they are soaked in testosterone.

>> That's correct. I That's the whole

thing. I was like, literally Ukraine and

and the most recent conflicts have all

shown and it with Iran against the

United States has shown that might is

not the actual winner here or largeness

or muscularness. It's something very

different. And you know, testosterone

can also, if it's taken wrong, [ __ ] you

up like beyond belief, correct? I mean,

I you have a doctor's care, but I know a

lot of people who do this is

off-the-shelf and problematic and cancer

causing and everything else if you don't

do it properly.

>> The average young person needs the

following. Nothing. They need

relationships. They need a gym.

>> Good food.

>> They need the money to have decent

nutrition.

You know, but they don't I some of the

craze around peptides and enhancements I

and I realize this is somewhat

hypocritical, but as a 61-year-old male

desperately clinging to just try and

feel 45 again, I do think there's a

difference.

>> Yeah.

>> But I I worries me this notion that

young men this peptide stacks and I I

think that stuff is

>> Dangerous.

>> borderline a little bit scary and your

your 25- or 35-year-old self is pretty

[ __ ] awesome on its own as long as

you do some very big good sleep, good

nutrition.

>> Yeah.

>> Gym three, four times a week.

Some some practice to push your limits.

You know, be strong, be fast.

>> I can't tell you the amount of like

people tell me they're buying

off-the-shelf peptides. I'm like, "Oh my

god."

>> do any of that [ __ ]

>> Are you I'm like it comes from China.

It's not it's not

>> Yeah, you don't know what's in it.

>> tested.

I hope you like sepsis. Like I just I'm

like, "Oh my god." And it's not to say

there shouldn't be they shouldn't be

doing all this research on peptides. By

the way, GLP-1s are a peptide. Um but

the way people are doing it and this

just sort of brings it out this idea

let's jack up our let's steroid up our

um our troops and make them insane. Like

I don't know. It's just so unhealthy.

Anyway, typical of Pete Hegseth cuz he's

as dumb as a box of hammers. Anyway, uh

next one, Elon Musk likely broke

Wisconsin law when he promised to hand

out those million-dollar checks to

voters in 2025 state Supreme Court

election, which he lost. According to

Wisconsin Election Commission, the

bipartisan panel found probable cause

that Elon violated a state law that

makes it a crime to offer a person

anything of value to get them to vote.

Uh now it's in the hands of Wisconsin DA

to decide whether to pursue charges. I'm

doubting they will.

Um but honestly, when he did that, that

was kind of so grotesque. He did it

several different places across the

country. I suspect he'll do it again if

he's not stopped. So I don't mind this

moving forward in some fashion. Um but

he you know, he's unchecked. I mean this

the money he's been he's put 90 I think

90 million dollars into um elections

right now at this point just him.

Um and the for the midterms and Ken

Griffin, a whole bunch of people are

just shoveling the money in in the

Supreme Court. The most recent decision

just allowed them to shovel it even

more. Thoughts?

>> Yeah, I think Ken Griffin is probably

running for president by the way. Um

>> Oh, really?

>> So

>> Say more as you like to say.

>> Well, he's taken a lot of public stands

on politics and if you're a billionaire,

the key to happiness is to be anonymous

and he's decided not to be anonymous

which says to me he has political

ambitions.

>> Oh, interesting.

>> Um also he's a smart guy, a lot of

money. Um

but you know, he's been very very vocal

>> Oh, so he's going for the Mark Cuban

slot except he's like half as nice like

that kind of thing.

>> Uh there's a huge line on the Republican

side. Everyone keeps talking about the

Democratic the Democratic

primary is going to be a is going to be

a

>> fight.

>> because there's a lot of good people.

>> Handsome Ossoff

Handsome Ossoff

>> I'm having you see him in the Senate.

He's amazing. He was like Kennedy.

>> I think he's hot. I can't believe it. I

was like

>> Oh, he is hot. He guys got total Kennedy

vibes.

>> Yeah.

>> Total Camelot vibes. I'm having I'm name

dropping. I'm having uh coffee with

another potential presidential

candidate, Senator Kelly from Arizona

who you meet with the guy. You want to

talk about testosterone? The guy flew a

craft 30,000 miles an hour

an hour while also flying combat

missions.

>> He's a solid man. He's a man.

He's a twin.

>> And you know, and he's like talk about

someone who's been an outstanding

husband. He's

Anyways, he's a great role model for

young men. But look, I

The problem isn't election interference

in Wisconsin. The problem is

we've essentially decided that money can

run unfettered.

And so, what do we have in society? Most

people would agree the 1%

has disproportionately benefited. It's

not even the 1%, it's the 0.01%

and the 0.01% right now

is in a position because of Citizens

United and the most recent Supreme Court

decision.

I I told you my conspiracy theory, which

I think is just just self-evident. I

believe that this phone call took place.

President Trump, is there any way you

can lean on the SEC chair or the Nasdaq

to let to include SpaceX right out of

the gates in the Nasdaq 100?

And as a result, you'll get, you know,

retail investors will have the

opportunity to invest, I'll have more

demand.

>> Of a of a small group of stocks and not

a lot is out there and so it it put it

it juices the stock, but go ahead.

>> It's trillions of dollars that have to

all be allocated to one of 100 stocks

based on the market cap, which creates

unbelievable demand that what that isn't

that has never been there for that has

never been there for a new issuance in

history. So, President Trump, if I my

net worth goes up 20 trillion

20 120 billion dollars because of a

smart move on your part, I don't see any

reason why I wouldn't put one, two, 10

billion dollars into the midterms.

And these elections are won or lost by

two or three percentage points. You

you're telling me a billion dollars

can't get you another couple points in

Maine?

I mean, or wherever it is.

>> Maybe. Maybe. He didn't win in

Wisconsin. He spent $25 million there

and

>> Well, that's the silver lining here is

that money seems to have

>> some effect.

>> Uh money the the ROI on money is going

down. It used to be that 95% plus of the

people who raised the most money won

because it was largely based on

incumbency

>> and television buys and this and that.

>> But Tom Steyer spent a quarter of a

billion dollars to come in fourth or

something in California.

So, that's the good news, but still it

it goes back to the same thing. The

problem isn't

people the problem isn't people with

billions of dollars. The problem is if

you can directly connect it to

undermining our democracy,

you have unelected people deciding who's

going to be president. So,

anyways, I I think we need

one case isn't going to move the needle.

>> that they're doing it though. That cuz

that was at the time I was like, "Can

anyone stop this? This is insane. You're

buying votes." I just it's it's so

buying votes. It was like, you know, it

just seemed like ridiculous that that

that it was so explicitly bad. I hope I

hope they they pursue it. But, um

speaking of election interference, which

there're going to be a lot we're

recording ahead President Trump's

working as hard as to interfere with the

election. Uh he's going to do a

primetime address to the nation where he

will discuss {quote} free and fair

elections and other topics a potpourri

as one advisor put it. Should never use

the word potpourri. Uh allegations about

China meddling in the US election

reportedly come up and some reports

suggest he'll once again push claims of

election fraud in Georgia speaking of

Jon Ossoff. Let's listen to what uh

Ossoff had to say during an appearance

on MSNBC.

>> There's talk that he might try to

declare me and Raphael Warnock

illegitimate senators. Obviously, the

president has no power to do that, but

he does have the power to try to

intimidate people. He's demonstrated his

will to abuse power. I expect him to use

whatever he puts out there on Thursday

as a pretext either for some attempted

unconstitutional use of federal power to

interfere in the election or to give his

proxies and loyalists in state and local

jurisdictions some cover for whatever

they might attempt or to lay the

groundwork for challenging the result.

>> So, there it is, you know, and it's

really interesting cuz you know,

especially cuz his like handmaidens to

seditions like Senator Cynthia Lummis

rhymes with hummus, dummis. Um you know,

I don't know if they were they were

properly elected. Like they're they are.

They go they follow along. Trump also

removed all three sitting members of the

bipartisan US Election Assistance

Commission, a group that oversees the

testing of voting systems. It's all over

the place. This is something Bannon they

Steve Bannon has talked about. There's

all manner of attempts uh possibly using

ICE

uh etc. etc. etc. Uh thoughts on this

besides the handsomeness of John also?

>> You can't have a democracy when one of

the two parties acceptance speech is

always the following.

We won or it was rigged. And election

interference, the good news is that

essentially affordability, which right

now the Democrats are seen as better on,

is dominating in Gallup polls what

people are concerned about. Only 2% of

voters believe America's biggest problem

is election reform.

So, but at the same time I also read 60%

of Republicans think the 2020 election

was rigged. I mean,

it this is just so bad for America

because

when you repeat a lie, th- this is

straight out of the GRU. When you repeat

a lie over and over,

it becomes less outrageous, then it

becomes normalized, then it becomes

self-evident.

>> Correct. Yeah, that is correct.

>> And our media, they just have a

responsibility.

I I I was just so I met uh I forget his

name, the guy interviewing to be the

head of

our intelligence service.

>> Clayton, Jay Clayton.

>> Yeah, I met him at a conference. I spent

a little bit of time with him.

Reasonable, smart, impressive man.

Can't say that Biden won the 2020

election?

>> Yeah, he can't. He actually can't do it.

>> And because he then his nomination will

be pulled by Trump. And it's like, okay,

at some point

at some point these men have to be men

and say [clears throat]

my kids are going to think I'm a coward.

I You don't think that video is going to

be played back over and over and over in

your kids third grade civics class?

>> Rest of his life.

>> Rest of your life. It's like And by the

way, maybe the nomination gets pulled.

But don't you want to be that dude?

Don't you want to be the guy that said,

"Of course he was elected, yes." And

then have Trump And then have Trump pull

your nomination and be a [ __ ] hero.

>> I know. You know, of all people, Thomas

Massie was like, um we have the House,

the Senate, the presidency, and pretty

much of the Supreme Court, and we're

called saying the election

>> Elections were rigged?

>> Rigged. Like, wow, keep rigging them.

Like, it was it's ridiculous. I mean,

the fact I mean, one of the things it's

just ridiculous. It it's it's an

astonishing repetition of lies. The

Those two There was two hearings. It

wasn't just him. It was also the um

attorney general. Can't say it. They

can't say it.

Biden was certified president. That's

all they'll say, which is not the same

thing. I mean, that The fact that they

can't say it, and it's happened several

times with cabinet members, is really

something else. It really is. And and as

it's as if they live in Putin's Russia,

and they do for the Republican Party,

where if they say the wrong thing, they

they get like thrown out a window,

essentially. And this is a not a

not a real throw out a window, but it's

a sort of version of it, a political

version of it.

>> There has never been a testosterone

therapy like a Republican losing an

election.

>> We'll see. I don't know. You think Tom

Tillis and John Cornyn are going to push

back on Blanche?

>> Look what truth tellers these guys are

once they lose their election and they

have only six more months in the Senate

or whatever.

>> I'm waiting to see if they vote against

Todd Blanche.

>> I mean, his personal lawyer.

>> Yeah, his personal lawyer.

I'm his lawyer. I mean, I was his

lawyer. I mean, I don't know what I

mean. You know, I don't think they're

going to I think they're going to vote

for him. They're not They're going to

let it out of committee. I just don't I

I I don't think they they still can't

sack up. Too late, Tom. Stack up, Tom.

Stack up, Tom. Take some testosterone if

you need to. Take some borrow it from

Hekseth.

He Well, he can't stand. He can't stand

Hekseth. The whole thing

You're right. When do they When do they

stand up on stuff like this? It's like

what Adam Schiff said to Todd Blanche,

what happened to you? You used to be a

person of quality and it's really

interesting. Anyway,

um we'll see what happens and I'm not

Are you watching the speech tonight? I'm

not.

>> Oh, I don't I could care less.

>> care less. He'll

>> No,

you know what? I will watch it. I'll

just watch it on one of three social

media platforms that'll give me the two

or three clips.

>> Clips I don't know. They'll probably be

like 10 clips. Can I Can I just put

>> is now saying there's a 45% chance that

Democrats take both the Senate and House

at the midterms.

>> Yeah, both. Anyway, that's still 45. Um

let me just say I'm going to go back

because this is the same thing this

repeating of the lie that you just said.

They the link the the

the reflecting pool. This is the kind of

thing the lie the lie the lie the lie

the lie and then everyone And by the

way, the media repeated it. We should

have like just now the reporting is in

and I got to I got to commend CNN who

did a very tough

report on it. Just like stop repeating

his lies and tonight if you if you all

repeat his lies, you're as complicit in

this in what's happening here. You have

to say this is not true. This is not

true and not even entertain it

in some level. You can report on it, but

you don't have to entertain it the way

they as if it's an equal thing. I just

That to me is really what really drives

me crazy.

Anyway, let's go on a quick break. When

we come back, things are going to get

explosive and not in a good way.

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Scott, we're back and never has diarrhea

been so political. Now, let me pronounce

this right. A Cyclospora outbreak has

now spread to 34 states. It's a parasite

that contaminates fresh produce and

causes severe watery diarrhea with

frequent and sometimes explosive bowel

movements according to the CDC.

Officials are still investigating the

source. Michigan officials say the

evidence points to lettuce or salad

greens.

Federal and state officials are also

looking into whether Taco Bell

restaurants played a role. This is This

is so ridiculous blaming Taco Bell for

this. And making things more difficult,

the CDC, of course, scaled back the

country's comprehensive system for

tracking food-borne illness outbreaks

last summer. Thank you, RFK. That's your

fault. They cut these States can report

cases through other systems, but experts

say the cuts created blind spots making

outbreaks harder to track. Um just

ridiculous. These people made the cuts

and this is the result. Everyone's

having diarrhea. It's The fact that

diarrhea is the is the brand for the

Republican Party, like bringing us

diarrhea and measles and possibly polio

is

and Ebola is really quite something. I

just I I I don't know. I I like lettuce

and now I'm like nervous about eating

it. It's crazy. Um the memes are

amazing. Let's go through a few of them.

Someone on X posted, I found an

explosive diarrhea parasite with a

picture of Stephen Miller. Also, first

Mitch McConnell and now Cyclospora, big

week for evil vegetables. And maybe

explosive diarrhea will finally be the

thing that brings both sides together.

Uh thoughts on explosive diarrhea?

>> Yeah, I don't know. I

>> [sighs and gasps]

>> I I'm I was feeling really good. I'm I

had the best

You know what's coming.

Uh I had the best bowel movement I've

had in years the other night, and then I

realized I was still in bed.

Um

Look, I don't

>> Okay, that was good.

>> Uh you know, all of these things,

whether it's testosterone,

yeah,

like the CDC, we need we need thoughtful

people.

It It goes back to the same thing. This

is true of Democrats and Republicans.

We've taken for granted how many

competent people

>> work for the government.

>> work for the government. And that you

need a diplomatic corps that can say

this memo of understanding doesn't mean

[ __ ] anything, and we need to do hard

work of diplomacy here.

We need

We need talented

medical professionals in the CDC to go,

"This is a risk. These are the

preventive steps we need to take." Who

have the support of the White House

and aren't you know, trying to figure

out ways to undermine, you know,

vaccines. So,

for every Look, for every $1 invested in

public health preparedness, you get

multiple dollars in avoidance of health

care costs and productivity losses.

>> Yeah.

>> Food borne illnesses already cost the US

tens of billions annually.

You don't notice these things when the

CDC is working. You only notice it when

someone is [ __ ] themselves.

>> small outbreaks as opposed to these

enormous ones.

>> Well, okay, but America, you know, and

this is true of Democrats and

Republicans,

you need to appreciate government before

you start [ __ ] yourself.

>> Yeah.

But in this case, this was the

Republicans cutting these programs that

had been in place.

>> Agreed. Elected by an American populace.

>> Correct. That's correct. That's

absolutely correct. But I don't think we

voted. I don't think even those people

voted for diarrhea.

>> Right. Nobody voted for diarrhea. And

you would assume that this is the kind

of stuff, you know, the fact that they

go for this stuff is really interesting

to me. I'm like, that seems like a like

a real like I don't know. It just It's

so

It's not such a short-sighted. It's just

dumb. Like let's stop the tracking of

foodborne illnesses. What What plus Who

made that decision? That like I want to

be in that room. Like who said, "Yeah,

that's what we're going to cut cuz

that's something that, you know, isn't

important like salmonella or something

like that." I don't know. It's It's a

really I think it is all knitted

together. And again,

back to the reflecting pool. It's like

those were no no bid contracts. Back to

all the no bid contracts all over all

over the place where you have shoddy

work or shoddy this or shoddy that. And

then in this case, it's diarrhea. I just

And of course it's now it's going to hit

lettuce makers, you know, people who

sell lettuce, grocery stores, the all

the implications. Everyone's eating

chocolate chip cookies. They get fatter

whatever. Um let me ask you a question.

As a marketing person, how would you

sell this as a Democrat?

If you're Is it Is it worthwhile to make

use this in in the election?

>> Yeah, you know,

bombs, diarrhea, and inflation. I I

That word is so powerful that I I would

probably couch it in America's health

being ignored which drives up costs.

So you you you can't afford the

treatments to the diseases you shouldn't

be getting. I mean,

yeah, I I think I don't know. I think

they need to test it. I I still am all

about

accountability and affordability or

maybe affordability and accountability

or renewal. I'm you know, I'm I'm

working on a bunch of messaging around

these issues.

This is

it needs to be more than a meme. It

needs to be broadened to our health

is is been compromised by an incompetent

set of um officials where

it comes back to the same thing and that

is opting for fealty over competence

will hurt the American public.

>> Yeah.

>> And the Democrats, if you look at past

administrations, sure, you know,

politics plays a role,

but here are some of the

you know, I would hold up I I would say,

"Okay, let's just look at Surgeon

General Murthy. Let's look at let's just

look at these people's backgrounds.

Let's look at the former Let's look at

some of the people who ran our our

intelligence

and who's running it now. I just run ads

around All right, let's look at past

defense secretaries and Pete Hoekstra.

Let's just compare

>> Compare and contrast, yeah.

>> Yeah, and contrast. And unfortunately,

that doesn't fit on a bumper sticker.

There's probably something very clever

around this they can come up with.

>> a grift kind of thing that's really I

think is actually very strong. Like just

just this week, the FCC under the [ __ ]

Brendan Carr signaled that will vote to

repeal the cap on ownership of TV

stations, a limit that keeps owners from

controlling the stations over 39% of the

markets. They're trying to merge

companies and they've been blocked by um

various lawsuits. And you know,

Americans' confidence in technology

companies has fallen like drastically. I

just think that you put out an idea of

the grifters are here and you're getting

diarrhea. The grif- the rich grif-

they're getting rich and you're getting

diarrhea kind of thing.

>> Well, like what can we do about it? I'm

always thinking other than just barking

into a mic. I'm putting out a bunch of

threads in a bunch of

posts.

Well, I initially thought this is this

could be the Democrats making light of a

bad situation and and placing blame

where they're where they shouldn't. And

then I did just a touch of research.

On July 1st, 2025, the CDC's foodborne

surveillance network called FoodNet,

cool name, dropped a number of pathogens

that require states to track from eight

to two. Only salmonella and E. coli

remain mandatory. Cyclospora, Listeria,

Campylobacter,

Shigella, Vibrio, and Yersinia all

became optional. Cyclospora has been

tracked continuously since 1997, meaning

28 years of monitoring ended the summer

before the biggest outbreak on record.

Folks, connect the dots. Since

early 2025, the administration has cut

more than 3,000 positions from the CDC,

roughly a quarter of the workforce. And

what do you know? We're having a

Cyclospora outbreak. I mean,

it's this is math. This isn't politics.

>> Let's connect the dots. They They can't

run. They can't govern is what you want

it really. They cannot go They don't

govern, and when they govern, they

steal. I mean, I think that's

>> The administration dissolved the CDC's

division of parasitic diseases and

malaria.

>> Yeah.

>> And they they keep saying it's bloated

bureaucracy. Well, talk about Okay,

bloated is a key word here.

And and wasteful. I mean, these these

words are taking on new meaning right

now. And the pattern isn't limited to

one parasite. A second one, a

flesh-eating New World screwworm, showed

up in the US showed up in US livestock

in June for the first time in nearly 60

years.

And so these these Talk about gross.

These larvae burrow into the flesh of

living animals, and the USDA is fighting

it by releasing millions of sterile

flies in Texas. Mexico and Canada have

both restricted US cattle imports over

the spread. So,

this this neutering this neutering of

our government agencies and replacing

them with

loyalists and competence

is Folks, the chickens are coming home

to roost, except the chickens have

diarrhea or will give you salmonella or

whatever. So,

>> paint a pool.

>> But again, I come back to the same

place.

>> Our government is stacked with or was

stacked with talented people.

>> I agree. I agree. Anyway, on a much

different note, OpenAI's much

anticipated first device is going to be

smart speaker, according to Bloomberg.

The device, which is under development,

is meant to be human-like AI companion

that lives in the home. It will help

control smart home appliances, play

media, answer questions, and tap into

the capabilities of ChatGPT. It sounds

like Alexa to me. OpenAI believes the

device is different from anything Apple

has on the market, which might come into

play with that Apple lawsuit that we

talked about. Obviously, the delay there

Anthropic is allegedly going to go

public in the fall sometime.

OpenAI probably is not. Is this a

product that's going to work, Scott?

This seems like a product Scott Galloway

does not like, but perhaps he does. I

don't know.

>> I actually

I like it more than I thought it would.

I thought I would because

you keep talking about and

at some point there needs to be

a post-smartphone era, right?

>> Yes, that's correct.

>> And I I don't think the most valuable

product of the next decade or decades

won't be the one with the best screen.

It'll be the one that knows you really

well.

>> Right, absolutely.

>> And it won't be who builds the biggest

model or best model, it'll be who owns

your kitchen, your living room, your

car, your earbuds.

And Apple won because it owned the

interface, not because it had the best

technology or model. And OpenAI is

trying to own the relationships now.

Granted, Meta tried to do this with

their I forget what it was called, that

screen.

>> Remember that? Yeah.

>> So, I actually think strategically

going for a speaker and trying to go in

home

I'd heard it was going to be some weird

[ __ ] pin or something. I I I

or a an attempt to be

>> pins have been tried that you carry with

you. At some point you will Let me say,

you will have a pin on you at all times

or it'll be your AirPods that'll be

extra smart, right? Presumably.

>> I I think that's right. So, I think that

the idea

of a better Alexa, the idea I didn't I

don't think smartphone.ai was going to

work, but the idea of a

a really intelligent speaker

I conceptually I think this is

strategically I think it's correct.

The thing that everyone learns and is

just littered with dead armadillos is

believing that because they're good at

software they'll be good at hardware.

There are so few companies who have made

the leap to hardware.

I mean, think about it.

>> What hardware in the home do you trust

though? I mean, my son literally took

all the Alexas out of our house. Like

he's like they're not going to surveil

us. That was one of the issues. The

other they're always listening. Like

people are nervous about this kind of

you know, even even the the um

the alarms that people put on the

cameras, like they they got manipulated

[clears throat] from outside where

people were looking inside people's

homes. I mean, I think and then Amazon

Remember Amazon was going to have a

drone that followed you around your

house and did things?

Like a little floaty thing. I mean,

eventually people will have a version of

that presumably. It's just who do you

trust to be in your home?

Cuz I wouldn't put any of these things

in my home at this point.

>> So my first thought when I read this was

two things. My first [clears throat]

thought was

All right. I think this is actually

smarter than I thought. At least

strategically, obviously this is all

about execution cuz I thought they were

going to try and put out some, you know,

the Amazon Fire Phone or whatever it is.

Um the second thought I had was I'm

going to buy Sonos stock. I think Sonos

is going to be acquired.

>> Oh.

>> Cuz I think for Sonos has a market cap

of 1.7 billion. That is literally change

in their couch for these companies and

they immediately have an installed base

of speakers where they can just upgrade

the technology.

>> work.

>> I think Sonos is amazing.

>> Sonos but you I have to tell you it's

the most difficult to get coordinated.

It is always glitching. It's always

glitching. I and I'm smart about these

things and I love Sonos.

>> but you asked there are so few trusted

brands in the home. It's really

interesting like like Sub-Zero is such

an amazing brand. You can buy a $4

million home and they will advertise

that that has an $8,000 refrigerator

called Sub Zero. That makes no sense to

me.

You think about how many actual brands

that the furniture market is totally

fragmented.

>> It is, yeah.

>> Sonos is a decent brand.

>> No, I agree. I have Sonos.

>> an installed base.

>> You're right. I like Sonos a lot.

>> And by the way, the stock is up 56% in

the last 5 years. That company is

screaming for your capital.

>> in the home and I don't but I don't have

Alexas. I don't have It's a really

interesting thing because but this when

remember when Amazon bought Eero, I

guess? I was like, oh, [ __ ]

>> I was You know what I mean? Like cuz I

love the Eero guys. They were really

interesting.

And this is too This is basically

repeater for your internet essentially.

And And then when um

Google bought Nest, I was like, oh,

damn. You know, like, oh, they're here.

And now I do keep a Nest in my home and

I do keep a Sonos but some I don't know

if I want chat GPT around my house. I

don't think I do. I think I do not.

>> I think you're I've always bought that

people talk a big game about privacy and

if they can see their Uber QX60s getting

a little bit closer on the screen,

they'll give up all of their data.

>> Yeah, I don't need

>> I've just

I think people opt for utility over

privacy and then they talk a big game

about privacy.

>> you shovel a lot more stuff into chat

GPT than I do. I won't. I still don't

and I don't It's just cuz I don't want

this particular company. It doesn't mean

I wouldn't I would allow Apple in the

home a lot more

readily. But they never come up with

anything. Their device was terrible. I

have one of those. I post I'm It's in a

box somewhere.

I still have yet to integrate these into

the home in a way that is useful in in

what they're talking about here. So,

you're right. We'll see. So, someone's

going to get it right. Anyway, let's go

on a quick break and we come back, we'll

talk about a tumble for IBM shares and

what it means for the market at large.

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

stock is down 26% in the last 5 days

after issuing a rare profit warning

noting the shift in customer spending

from software to AI hardware and chips

ahead of the quarterly earnings. The

sell-off erased $69 billion in market

cap and the initial tumble marked the

company's worst day since at least 1968.

The S&P software industry index is down

over 13% for the year. You've talked a

lot about the software companies. By the

way, SpaceX is really taking a digger.

Oracle is way down. Um you know, and

just related, I think New York has

become the first state to ban the

construction of new data centers. The

pause applies to new data centers

requiring 50 MW or more power for up to

a year while state regulators develop

new environmental and energy standards.

Governor Kathy Hochul noted that New

Yorkers have seen their energy electric

bills surge 68% since 2019 and a June

poll revealed revealed that 46% of New

York voters believe 1-year moratorium on

large data centers would be good with

just 21% saying it was bad. So, this is

all related to each other, this idea of

this growth. Talk a little bit about IBM

and then you know, the links to Oracle,

SpaceX, everything else. They're really

trending downward in a really

significant way and people are nervous.

There's so much more

discussion about a possible collapse um

by lots of different people. Noble, the

the investor George Noble, uh Bill Cohen

did a great interview with him. He's

nervous. Thoughts?

>> I was caught off guard by that. I mean,

this was they came in at 17.2 billion

versus 17.9

and the stock got its worst day, I I

think maybe ever or in 50 years, and it

erased a quarter of IBM's value

over a $660 million revenue miss. That's

about $100 of market cap for every $1 of

missed revenue. The reason why is IBM's

customers are raiding their own IT

budgets. In the In the In the last few

weeks, clients pulled spending from

software and mainframe deals and use it

to panic buy server, storage, and memory

before prices rose further. So, in the

the sell-off infected the entire

enterprise software market. The The fear

is that they're the canary in the coal

mine here, and that is the real loser is

anyone who buys memory instead of

selling it. So,

data centers are forecast to consume 70%

of all memory chips produced in 2026, up

from 20 to 30%, and

three companies make up roughly 90% of

the world's DRAM market, and all three

have shifted production towards AI

chips.

So,

their costs are going up, and meanwhile

their revenues are flat or down. So, you

have margin compression and meanwhile

and top line going down. So, the losers

are everywhere else. Uh PC makers

who consume a lot of memory or buy it,

that was 15 to 18% of PC materials cost

is now heading towards 40%. So, in a

competitive margin in a competitive

commodity market, your your costs are

going up ways.

>> And so, prices have to go up.

>> Think about it. Apple has already had to

raise its prices, but they have the

margin power to do it.

>> Yeah.

>> Xbox has raised prices by consoles as

much as 150 bucks. Smartphone shipments

are projected to fall 13% on memory

price surge, and software and services

corporate IT budgets are being

redirected to panic buying chips.

So, the the AI trade

has gone parabolic, but the losers have

suffered tremendously. Accenture's down

47% year-to-date. I think that's a lot

of those back office jobs

people think AI will will will will

supplant. IBM's down 28%, Microsoft down

16, ServiceNow down 29, Salesforce down

34. I actually spoke at Salesforce

yesterday.

Um so I

this is the the market is reshaping

around, you know, big winners and big

losers and IBM is perceived as being on

the wrong side of the trade cuz now it's

competing it's competing

with to buy the memory against companies

that have a better business model that

or or better prospects.

>> Right. Right. But what what about the

overall trend cuz there's so much noise

now? I mean, I was really struck by this

George Noble interview that Bill Cohen

did. That, you know, there he's just

like this is he essentially was like

this is bananas what's happening right

now with with the spending. And you do

see, you know, SpaceX despite the index

thing is drifting down, drifting down,

drifting down on more and more. Ed Ed

Elson, by the way, is enjoying the

entire drift. There's he does a he does

a thread every 5 seconds about it. Um

talk What is the

Are you very worried cuz a lot of people

I just have been hearing so much more

noise around that and it seems very

interrelated to these data center

slowdowns and that the business isn't

quite there and OpenAI is not going to

go public this year. Maybe Anthropic

will get through.

Um

Are you

Are you still remain worried or are you

paying attention to that? Cuz I think

they're all related to each other.

>> I mean, and granted, I get the [ __ ]

wrong all the time.

Um

I think we're I think we're literally

late stage 99. I [laughter] mean

and I think I think it's un- I think

it's unfurling

remarkably similar.

First it was B2C, the Amazons, the

eToys, the you know, the the

the pets.coms of the world imploded

because they didn't create the demand to

justify

their evaluations. Okay, so what's under

what's under huge shot right now? The

ultimate consumer AI play, which is open

AI.

And then everyone but wait, it's about

B2B. So everyone shuffled into Anthropic

thinking it was the enterprise market. I

think that's the next one to come from a

trillion down to a hundred billion. By

the way, a hundred billion dollars is

what Starbucks is worth. That's not

that's still a lot of money.

>> Yeah.

>> And then the next the next shoe to drop

will be similar to what happened.

Everybody got out of B2C got out of B2B

and then they went into global crossing

and Cisco cuz it's still in the ground.

And then I think the next shoe to drop

where I think we're going to start to

see weakness in the infrastructure

players, specifically Nvidia and

in later half later part of this year

beginning of next year. This whole

I feel as if we are literally in the the

the beginning of the unwind.

>> Yeah. And these data center bans or

construction of them, I I think it's a

good idea. Voters want this. I think

it's actually good government to say

like let's take it's not saying no data

center. It says let's take a year, let's

figure it out, let's do it so that

consumers don't have to pay. It's a

great political message and it's not

anti-innovation. It's slow the [ __ ] slow

your roll, dudes. Like this is

ridiculous what you're doing to our to

our environment and our costs. And you

know, they try to blame things like coal

and others. I think it's actually good

governance. That's my feeling.

>> Look, it's become politicized. I think

data centers have become the vessel for

outreach rather than income inequality.

And I think some of the concerns around

them are inflated. The notion that

they're going to soak up all the water.

They're noisy. Well, they're not they're

not many most of them aren't near I I

feel that essentially this has become

the new

the new kind of

whatever it is squeeze toy or or anger

mannequin for income inequality. And

then and what is the biggest brain dead

brand move of the century, they decided

to make the spokesperson for data

centers Kevin O'Leary.

>> Yeah.

>> So but if I were a civic official, first

off, these people aren't the people

approving these data centers aren't

stupid because these companies data

centers don't call the fire department

or the police department and they pay

property taxes. These people aren't

stupid approving the data centers. What

I would do if I were a local civic

official is the following. I would say

we will cram through your approval. We

want 10 years guaranteed property taxes

no matter what happens to your company

because I think a third to half of these

things aren't going to get built, but I

still want those revenues.

>> Yeah, and also maybe some You've got to

talk to voters about the electric bills

and everything else, you know, and cuz

it they

I think the people who are opposing them

have made very have done a very good job

of linking them with billionaires and

like you're right, Kevin O'Leary looks

like a [ __ ] idiot.

>> But that's math. That a civic official

should be able to say, we have

economists and power people estimating

what the increase in electricity costs

will be. If the those are in fact true,

we need to at a minimum compensate

consumers with the property taxes or

fees you're going to pay.

And also, I would say I

I a friend of mine owns a shipping

company and shipping container ships

went to like from $30 a container to 150

because of Hormuz and I'm like, is there

any I'm like, is there any way you can

buy futures or sell futures and lock in

that price for the next 10 years? And

he's like, I'm trying. If I were a civic

official, I'd be trying to lock in the

revenues and the property taxes these

things are going to pay for the they're

supposed to pay for the next 10 years

cuz Cara,

what I find generally in life and in

business is the [ __ ] you are most

worried about doesn't come to fruition.

>> Ah, interesting.

>> Because you start planning against it

subconsciously. The The [ __ ] we're

Remember Y2K? How worried we were?

>> Do you know where I was? May I tell you

a short story? I was sent by the Wall

Street Journal on the best night of the

of of a New Year's for that 2000. I had

to be at Yahoo and E-Trade. That was my

life right then as a young reporter. I

had to hang there and nothing happened.

Go ahead.

>> Well, or remember you probably

I used to go on Bloomberg when I was

going on TV there and for [ __ ] 12

months we talked about

the collapse of Greece and how it was

going to affect the EU. The moment you

start worrying about everything, it

doesn't happen. No one was worrying

about planes slamming into the World

Trade Center. We weren't that worried

about a virus jumping the lab and in

fact I mean Bill Gates was.

We are so worried about data centers

that my view is in my thesis is that all

of a sudden we've had this incredible

flipping from a supply crisis to

actually a demand crisis. Everyone

Everyone that was supposedly going to

create all the demand for data centers

is now selling their data center

capacity and storage to the to the two

companies creating demand open AI and

Anthropic.

So if I'm a civic official, I'm like

bank that money now. Get their

commitments cuz I

And also all the innovation is going to

go into chips and inference and compute

that requires less energy.

And all my the most [ __ ] ridiculous

thing. Have you ever been to one of

these things? The idea that we can put

any semblance of one of these into space

>> I know.

>> makes the robot then look practical.

>> robot [laughter] then.

I you know my favorite person everyone

should follow him Yann LeCun on the data

space banner data base centers makes me

laugh. I love that he says it though.

There's part of me that I got to say you

know I'm good one. Good one. Space

centers data centers in space like I'm

like what a

load of crap but I love you for trying

it. It's like having the you know we

were supposed to have 50,000 Optimus

Primes in our home this year. Do you

have one yet?

>> Oh no, I mean but hold on let me ask my

robot.

>> Yeah yeah exactly. I think we will. By

the way, I think we will eventually. You

think it's going to be you think we're

going to have a robot? Eventually but

we'll be dead. It doesn't really matter

but yes I do. I think

I think it's just a load of crap but I

love you for trying it. It's like having

the you know we were supposed to have

50,000 Optimus Primes in our home this

year. Do you have one yet? Oh no, I mean

but hold on let me ask my robot. Yeah

yeah exactly. I think we will. By the

way, I think we will eventually.

>> but I like the fact that they just lie

through their teeth about it. Something

and the lie is very creative. Anyway,

one more quick break. We'll be back for

predictions.

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Okay, Scott, let's hear a prediction.

Let What What is your prediction?

Besides, I'm going to make a prediction

Odyssey is going to like blow.

>> Yeah.

>> That.

>> That's a pretty safe one.

>> you No, but I think like way more than

people think. It is really that good.

And I think people are again, just like

they were with smaller movies like

Obsession and Back Rooms, they love

getting in the theater when something's

worth it. This one is worth it. I think

it's going to blow out well beyond what

people think the blowout's going to be.

>> I like it. I'm going to see it. I'm

excited that you liked it.

Uh so, my prediction is that OpenAI is

going to buy Sierra and make and sell

Bret Taylor a CEO.

>> Oh, great idea. I I Did I say this to

Who said this to me? Someone asked me

who I thought was should be CEO of

>> You you You planted the seed. You said

Bret Taylor.

>> Yeah.

Okay.

>> Like the the the most successful

companies don't stop at the platform.

They own the application layer. Like

Apple didn't stop at iOS. It created the

App Store.

>> Explain what Sierra is for people who

don't know. It's his new startup.

>> So it it's essentially

they're in the application layer for AI.

They're one of the best enterprise AI

products.

Um

and they're essentially they they are

have evaluation of 4 to 5 billion.

OpenAI supposedly worth 800 to call it

500. So for 1% of the company they get a

CEO.

And right now Bret Taylor is probably

They need to bring in an adult that

calms the markets.

And OpenAI does you can If OpenAI does

in fact have the best model, Sierra has

one of the best enterprise AI products.

And Bret And Bret Taylor is arguably the

best enterprise software operator of his

generation right now.

And these as these foundation models get

cheaper, intelligence will commoditize.

So the scarce asset won't be IQ. It'll

be customer relationships, workflow

integration, and enterprise trust. And

that's essentially what Sierra's

offering. So

>> Can I also say he can go toe-to-toe with

Elon? He's the one who got Elon.

Remember? Elon tried to pull out of the

deal. He was He was the chairman

>> [clears throat]

>> of Twitter.

Forced him to close.

>> He said this company's worth three. You

want to pay 44? Sign here, here, here,

and here.

>> Right.

>> And oh, remember me? You're the guy that

signed these documents. You're closing.

>> Right. He can go toe-to-toe with Elon.

And actually he's very well liked in so

very well liked. Like unusually well

liked.

>> Essentially Essentially Sierra's the

salesforce of AI. And if OpenAI wants to

be more than the Nvidia of AI, it needs

to own the salesforce of AI. So

>> Do you think

Sam Altman will give up the CEO-ship?

I'm not so sure.

>> Well, this is what typically happens.

The CEO is taking so much [ __ ] and and

has seen the valuation go down and that

has got to be [ __ ] Vietnam minus the

charm right now.

>> He likes being liked. I'll tell say

that.

>> I can't even imagine what's like to be

Sam Altman. So, he probably has agreed.

This is typically what happens when the

CEO's tenure is like this and a founder.

They agree to bring in a president and

then we all interview the president and

the really the person we really like

goes says the following, "I'm not going

to be your [ __ ] president. Make me

CEO." And then we all agree to make him

or her CEO.

Bret Taylor isn't going to take a

president job.

>> Right.

He did at Salesforce, remember? He was

sort of in

>> Yeah, that was as a younger man joining

joining Marc Benioff, one of the

greatest entrepreneurs in software,

right? He's his own He's his own CEO

now.

And so, this this solves so many

problems. It gives the market a sense of

calm and then an adult shows up. It's a

chance for them to turn over a different

leaf. It's a chance to create cloud

cover to dramatically decrease the

ridiculous cap backs. It's a chance for

Sam to save face and be the chairman and

the visionary and prepare and pretend

that it was his idea and they also get a

company on the in the application layer

for 1% dilution. This makes so much

In sum, the two most the three most

acquirable No, two most acquirable

companies right now, Sonos and Sierra.

But, this just makes so much industrial

logic.

>> Yeah.

>> Um I'm surprised. It may It may even be

a We We may even be in the midst of it

right now, but Sonos should be picked up

by one of these guys looking to get into

the home for scrap, but the real one

here is Sierra and it's not It's not

It's an aqua hire. It makes industrial

logic, but what they really need If they

announce Bret Taylor as CEO,

>> Yeah, big deal. I love it.

>> the valuation of the company goes up a

hundred billion dollars.

>> love it.

>> They get 20X on the acquisition price.

Say they paid 10 billion for it, they

get 10X just by with two words, Bret and

Taylor.

OpenAI is worth more than a hundred

billion dollars and they can say to Bret

>> I'm your muse. Do you know that? I think

I'm your muse.

>> Well, you're my inspiration on a lot of

levels, Kara.

>> I am. I must say.

>> Yeah, there you go. Anyways,

>> I love it.

Bret, call us.

>> Sierra is going to be acquired and Bret

Taylor by OpenAI and Bret Taylor's going

to be installed as CEO.

>> I like it. I love it. Uh we want to hear

from you. Send us your questions about

business, tech, or whatever's on your

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to submit a question for the show or

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