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00:00:00 Speaker 1
Two days ago.
00:00:01 Speaker 2
Here we go.
00:00:03 Speaker 3
In the PS:.
00:00:04 Speaker 2
Sai got into a fight.
00:00:06 Speaker 3
You got into a.
00:00:07 Speaker 2
I got into a fight.
00:00:08 Speaker 2
Like a physical altercation.
00:00:10 Speaker 2
The physical altercation, really?
00:00:12 Speaker 2
This chick shows up wearing a white wife beater, talking all kinds of ****
00:00:19 Speaker 2
And I said, listen, lady music.
00:00:22 Speaker 2
And she just kept drawing and joy.
00:00:24 Speaker 2
And here she is again.
00:00:25 Speaker 2
She’s asking more and so.
00:00:27 Speaker 3
I was like.
00:00:27 Speaker 4
I listen.
00:00:30 Speaker 2
I’ve never seen A1A 1GY.
00:00:33 Speaker 2
Feeder. Look at that list.
00:00:40 Speaker 2
There’s your cold open everybody.
00:00:42 Speaker 2
That’s the good.
00:00:42 Speaker 3
Stuff out there.
00:00:43 Speaker 4
Say hi to everybody.
00:00:44 Speaker 3
I know I’m not a Beagle.
00:00:46 Speaker 3
I know I’m not a Beagle.
00:00:47 Speaker 3
But I’m even better.
00:00:48 Speaker 2
I have my own thoughts, facts.
00:00:49 Speaker 2
What you’re seeing here is called affection.
00:00:52 Speaker 2
Between a parent and a child.
00:00:54 Speaker 5
Just let me know when it’s over.
00:00:59 Speaker 4
Rating refugees in the.
00:01:02 Speaker 1
World to watch.
00:01:04 Speaker 1
To mark versus Q rating by using his chances.
00:01:08 Speaker 1
Right.
00:01:10 Speaker 2
Free bird, where’s your?
00:01:11 Speaker 2
Puppy that you?
00:01:12 Speaker 2
Saved from being tortured with Kim Kardashian.
00:01:18 Speaker 4
Look at this guy ’cause he?
00:01:20 Speaker 1
Hasn’t been here in a while.
00:01:22 Speaker 4
There it is, there it is.
00:01:23 Speaker 3
Oh man, she.
00:01:24 Speaker 1
Was a belly rub.
00:01:25 Speaker 1
Get the pop star.
00:01:40 Speaker 1
Lastly, I mean.
00:01:42 Speaker 4
We have.
00:01:45 Speaker 2
Doc, what’s up with JD Harrison?
00:01:47 Speaker 2
OH, is he?
00:01:47 Speaker 2
Gonna pull this thing off, or is he getting beat up by reading an article about him?
00:01:52 Speaker 2
Getting set up with the Peter Thiel connection being.
00:01:55 Speaker 2
You got physically pita.
00:01:57 Speaker 2
No, like it’s not.
00:01:58 Speaker 3
Oh no, no.
00:01:58 Speaker 5
No, I think she should win.
00:02:00 Speaker 3
He’s going to.
00:02:00 Speaker 2
Win, right?
00:02:02 Speaker 2
And what about Blake masters?
00:02:03 Speaker 2
These are the two guys that she was backing.
00:02:06 Speaker 2
Through sort this so.
00:02:07 Speaker 2
We kind of did.
00:02:08 Speaker 2
Anything else?
00:02:10 Speaker 2
If any of us entered **** wouldn’t one of our names be brake masters like it?
00:02:16 Speaker 2
Just wouldn’t it be on the list?
00:02:18 Speaker 2
Like, doesn’t it sound like a grave?
00:02:19 Speaker 4
I don’t see it.
00:02:20 Speaker 2
Isn’t it a great meaning for ****
00:02:22 Speaker 2
A great name, Blake masters.
00:02:23 Speaker 2
It’s a great movie.
00:02:25 Speaker 2
And and JD Steele, I’m sorry, Vance.
00:02:27 Speaker 3
Yeah, go ahead, explain.
00:02:28 Speaker 2
What’s going on with this Manchurian candidate?
00:02:29 Speaker 5
Jamie, what would you would you would?
00:02:31 Speaker 1
You choose them up without any.
00:02:32 Speaker 5
Evidence? What would you say?
00:02:33 Speaker 2
I’m not using innovative anything.
00:02:34 Speaker 2
I’m just saying tell us about your Manchurian candidate.
00:02:40 Speaker 5
So James already won the primaries, and I think she will win. I mean, it’s gonna be, I think, a red wave in November, and Ohio is a pretty RedState these days.
00:02:52 Speaker 5
Bryce also win the primary in Arizona.
00:02:54 Speaker 5
It’s a little bit more of a toss up, but I think he’ll do well.
00:02:57 Speaker 2
Right, well, I had a.
00:02:57 Speaker 2
Follow-up question, but I’m not allowed.
00:02:59 Speaker 2
To mention the two words.
00:02:59 Speaker 2
So let’s just get started.
00:03:01 Speaker 5
Why is this such a big deal that, like Peter, supports candidates G? All these like crazy left wing radicals like Soros gives unlimited amounts of money to, you know, crazy progressives like gascoin LA and the zillion others?
00:03:04 Speaker 2
Yeah, no, I got it.
00:03:13 Speaker 5
I mean, why?
00:03:14 Speaker 5
Why is it such an obsession that we have to focus?
00:03:16 Speaker 5
On who Peter supports.
00:03:17 Speaker 2
No, I just think it’s fascinating that he.
00:03:19 Speaker 3
Cheaters are.
00:03:19 Speaker 2
Articulated his.
00:03:20 Speaker 2
All for supporting these candidates and his objective for, you know, changing government in the way that he.
00:03:26 Speaker 2
Thanks for benefit the.
00:03:27 Speaker 2
Country and he’s been.
00:03:28 Speaker 2
Generally right.
00:03:29 Speaker 2
What is the basis rebirth?
00:03:30 Speaker 2
I didn’t go.
00:03:30 Speaker 2
Part of it.
00:03:31 Speaker 2
We watched his speech from the RNC during the last trumpet cycle.
00:03:36 Speaker 2
I think he did a good job of articulating that there’s a lot of inefficiencies in government and there’s a lot of college accumulated stats, and we need someone to go in and we need people to go in and really.
00:03:46 Speaker 2
Pop this up because so much of politics is driven by what else I’m going to give you, not about what I’m going to fix that’s already being sent in initial.
00:03:53 Speaker 2
Way and as a result we see Jack climb with the Taxol, climbs with the efficiency, continue to decline of every dollar invested by the government.
00:04:01 Speaker 3
Right.
00:04:01 Speaker 2
And I think that’s a really important thesis to see someone actually trying to execute.
00:04:04 Speaker 2
Against ’cause no ones.
00:04:05 Speaker 3
More precisely.
00:04:05
In the patient.
00:04:06 Speaker 2
Very few people are in the position of defense to actually be able to like, make that sort of statement.
00:04:11 Speaker 2
Everyone wants something more from their government.
00:04:14 Speaker 2
Versus trying to fix the.
00:04:15 Speaker 2
I think his views are more extremely, I think there’s user more that Orthodoxy is ruining in America and so you need forms of heterodoxy to basically reset.
00:04:24 Speaker 1
Totally fair.
00:04:25 Speaker 3
Yeah, yeah.
00:04:26 Speaker 2
And I think that’s what he believes more than what you just said.
00:04:30 Speaker 2
I think that you need a wholesale reset and in order to have a wholesale reset, you need to have these very disruptive candidates that basically start to change the norms.
00:04:39 Speaker 2
I mean, if you if you think about what Trump did in one election cycle.
00:04:44 Speaker 2
Is he’s completely sucked an entire cohort of people.
00:04:48 Speaker 2
Hispanics and you know, moderates and now uh, you know a lot of immigrants towards the right because the Democrats have vacated all of that space in having this massive Trump brain syndrome and tacking extremely to the left.
00:05:05 Speaker 2
And even if Peter, we’ll never know, believed in Trump or didn’t believe in front, it didn’t matter.
00:05:10 Speaker 2
But the process of him getting that chance is elected over the long arc of history may ask me first to pull America back to the.
00:05:18 Speaker 3
Pretty good.
00:05:19 Speaker 5
Yeah, the reason why I support JD, and blame for that matter, is they are they represent this more populist working class.
00:05:27 Speaker 5
We had Republican Party.
00:05:28 Speaker 5
They’re dragging Republican Party in a more working class direction, and I think that’s the future of the party.
00:05:32 Speaker 5
I think the opportunity for the party to smoke point the Democrats have ceded.
00:05:37 Speaker 5
All the sort of this.
00:05:38 Speaker 5
Working class territory by becoming this elite Progressive Party and the face of the party right now, the Democratic Party.
00:05:44 Speaker 5
Is Papa Murphy.
00:05:46 Speaker 5
You know, let’s talk about this.
00:05:47 Speaker 5
It’s blatantly open.
00:05:49 Speaker 5
He’s trading on chip stocks like NVIDIA and Intel so forth, like the week before.
00:05:55 Speaker 1
The house is going to.
00:05:56 Speaker 5
Vote on a $52 billion.
00:05:58 Speaker 3
Subsidy trips on here.
00:05:58 Speaker 2
For not being more precise the week before his wife decides.
00:06:03 Speaker 2
Then critical legislation goes to the floor of the House to be voted upon.
00:06:09 Speaker 2
So you have the speaker of the house, who’s the third most important person in government, introducing legislation on 3rd time.
00:06:17 Speaker 2
Her husband trades in those specific equities, days and meetings in the same day.
00:06:24 Speaker 3
Right.
00:06:25 Speaker 2
Of that they make three times her annual salary just in one day.
00:06:33 Speaker 2
And then she and her husband decides to then fly, not asked by the United States government or the State Department, to Taiwan.
00:06:42 Speaker 2
To then talk about God knows what, which would have created an international uproar, the Biden administration and Tony Blinken had to basically call her and say, stand down, you should not go.
00:06:53 Speaker 2
We are not asking you to go.
00:06:55 Speaker 2
It is not on the United States agenda.
00:06:57 Speaker 2
For you to.
00:06:57 Speaker 2
Go, and all that would have happened is an entire process.
00:07:02 Speaker 2
And loop, where she controls the legislative agenda, her husband controls her private stock account and.
00:07:09 Speaker 2
And tablets in the names.
00:07:10 Speaker 4
Right. Yeah.
00:07:11 Speaker 2
And then they go to Taiwan, rip up the Fuhrer, which would have actually positively impacted those same names even more.
00:07:17 Speaker 2
It’s inexcusable.
00:07:18 Speaker 2
By kind of behavior, I mean, after 40 years, just go past the line and she doesn’t realize it.
00:07:24 Speaker 3
And by the way, Sir, let me just wait.
00:07:25 Speaker 2
Hold on.
00:07:26 Speaker 2
And then on top of that.
00:07:27 Speaker 2
Jason, the mainstream media.
00:07:29 Speaker 2
It doesn’t say **** now, by the way, I’m not a Trump supporter.
00:07:32 Speaker 2
I contains.
00:07:33 Speaker 2
A complete goofball.
00:07:34 Speaker 2
But if Trump had tried to pull this up in 2016 or 2017 or 2018, could you imagine how much media coverage there will be?
00:07:43 Speaker 2
And today, how much of that is covered by the mainstream media at zero?
00:07:46 Speaker 2
Was it mentioned on MSNBC?
00:07:50 Speaker 2
Wasn’t mentioned in any of the press?
00:07:53 Speaker 2
Let me just set the stage so people.
00:07:54 Speaker 2
Don’t know, we’re.
00:07:54 Speaker 2
Talking about so on Tuesday, the Senate advanced a slimmed down version of the original TRIPS bill.
00:08:00 Speaker 2
If you don’t know.
00:08:00 Speaker 2
What that is, it’s basically a bill that’s going to provide $52 billion in subsidies.
00:08:04 Speaker 2
To move chip.
00:08:05 Speaker 2
Manufacturing here to the United States, something we really need to do.
00:08:09 Speaker 2
It’s a bipartisan bill.
00:08:10 Speaker 2
Everybody kind of agrees.
00:08:11 Speaker 2
On this but this is.
00:08:14 Speaker 2
Been kind of stuck in committee for a little bit. It becomes a year after the center press approved the $250 billion bill to reinforce your ship making to compete with China.
00:08:23 Speaker 5
The reason why this is strategically important is because we have a huge tip dependency on Taiwan, which is under threat from China.
00:08:30 Speaker 5
So if chips or the new oil, you know Taiwan is the new Middle East or the new Persian Gulf.
00:08:36 Speaker 5
And it is a very dangerous situation for us to be completely dependent on Taiwan Lord, not completely, but like for over half hour chips.
00:08:44 Speaker 5
Onshoring the advanced chip manufacturing makes sense, but I think this is an example of how you you start with a legitimate objective in Washington, and very rapidly it turns into corporate welfare and grasped by politicians.
00:08:58 Speaker 2
Yeah, correct.
00:08:58 Speaker 5
I mean, yeah, I mean, just because you need to answer many fraction doesn’t mean that you give Intel or NVIDIA giant handouts.
00:09:04 Speaker 5
And then you’ve got.
00:09:04 Speaker 5
More policy.
00:09:06 Speaker 5
Making millions trading NVIDIA options?
00:09:08 Speaker 2
Yeah, and this is something that is holding.
00:09:08 Speaker 5
It’s ridiculous.
00:09:11 Speaker 2
To support onshoring of semiconductor manufacturing.
00:09:15 Speaker 3
Who would you give?
00:09:16 Speaker 2
The money to and how would it be?
00:09:18 Speaker 2
Kind of dull?
00:09:18 Speaker 2
Dabble with the terms of the deal?
00:09:19 Speaker 5
I don’t know that you don’t give these companies money.
00:09:21 Speaker 5
I mean, I think maybe what you do is you give them tax breaks or various kinds of breaks.
00:09:26 Speaker 5
But I, you know, I don’t want your ideas.
00:09:28 Speaker 2
Capital, they need capital to support that investment ’cause, you know, if you look at the kind of.
00:09:33 Speaker 2
Or oh, I see on these companies I would, I don’t like started getting there in the high teens or something inside teams and they’re not going to be able to invest in some new fangled, you know, fab projects that may or may not actually have customers.
00:09:46 Speaker 2
At the end of the day the board would never approved on an independent basis.
00:09:49 Speaker 2
The return on invested capital, since you’re a big industrial business, you know one of the key metrics that your shareholders.
00:09:49 Speaker 2
They need capital.
00:09:56 Speaker 2
That is the ultimate kind of profit, profits that are generated from a big investment you might make.
00:10:03 Speaker 2
And so you kind of look at that over time would be best investors money over time and it hasn’t returned over time you come up with this metric.
00:10:10 Speaker 2
And so it’s a key metric for particularly capital intensive businesses.
00:10:15 Speaker 2
And so business like Intel or NVIDIA I would imagine is going to have a pretty tough time selling their board on some speculative arm, storing fat projects that there really does need to be capital and acceleration capital.
00:10:26 Speaker 2
Who feeds you this ******** propaganda Intel?
00:10:30 Speaker 2
In 2020, approved the share purchase plans where these guys had a hold of $110 billion and have spent all of it except for 7.2 billion. They have 6 billion left on the balance sheet.
00:10:44 Speaker 2
I get it, but they’re not going to put that money at risk, right?
00:10:46 Speaker 2
Like like, imagine you’re.
00:10:48 Speaker 2
On the Board of Intel and they’re like.
00:10:51 Speaker 2
OK, so basically.
00:10:52 Speaker 2
Well, I made the turn of my words.
00:10:54 Speaker 2
This is where it all.
00:10:54 Speaker 2
Comes from, right?
00:10:55 Speaker 2
I make a ton of money.
00:10:57 Speaker 2
I have no better ideas on how to do it, including theoretically building.
00:11:01 Speaker 2
A chip factory.
00:11:02 Speaker 2
So I’m going to go to the government for.
00:11:04 Speaker 2
Handouts. Meanwhile, I’m going to.
00:11:05 Speaker 2
Take all the money that I had which I could have used this on this thing and I’m going to give it away to people who.
00:11:10 Speaker 2
I don’t know what they’re going to do with this.
00:11:12 Speaker 2
I would reframe it.
00:11:13 Speaker 2
I would say that the government wants to see our industry onshore semiconductor manufacturing and they are going to the companies, not the companies or the government.
00:11:22 Speaker 2
Things we want you to answer semi truck manufacturing.
00:11:25 Speaker 2
Do that for us now.
00:11:26 Speaker 2
Like in World War Two, we went to the automobile manufacturers and said the government said we want you to make airplanes.
00:11:31 Speaker 2
Here’s a bunch of money.
00:11:32 Speaker 2
Make airplanes, and that’s a good question.
00:11:34 Speaker 2
This but.
00:11:35
Who does that money?
00:11:35 Speaker 2
Let’s make sure this goes who?
00:11:37 Speaker 2
Who else?
00:11:37 Speaker 3
Would you give?
00:11:37 Speaker 2
That money to besides the two best.
00:11:39 Speaker 3
No, no, David brace.
00:11:39 Speaker 2
Fit makers in the world that are rotating.
00:11:41 Speaker 2
If you just give us a cap ex subsidy that’s a one time effect that helps you in a moment.
00:11:48 Speaker 2
It doesn’t help your business.
00:11:50 Speaker 2
Any reasonable investor who could actually use a simple calculator came through that nonsense.
00:11:56 Speaker 2
So what David Wright is, is you have given them sustained tax breaks for being able to build the business.
00:12:02 Speaker 2
Lines that then supplies things for the duration, you know, 10s of years.
00:12:06 Speaker 2
You’re absolutely right, investors would live.
00:12:08 Speaker 2
It would make a ton of sense.
00:12:10 Speaker 2
They would be over earning over a long enough period of time where people would have to bake that into their cash flow estimates where when you discounted it back.
00:12:19 Speaker 2
It would make the enterprise of Intel and NVIDIA worth more, and then people would then want to own that stock more.
00:12:25 Speaker 2
Giving a cap ex subsidy is a meaningless way in which you basically hand out good money to organizations who have otherwise miss allocated that money that they’ve already have.
00:12:36 Speaker 2
Yeah, there’s a much simpler solution to this axis.
00:12:39 Speaker 2
Kind of like how do you do this and giving free money is not going to do it the best way.
00:12:43 Speaker 2
To do is to give it incredibly low.
00:12:46 Speaker 2
Interest rate loan like a 304050 year alone that maybe we had some warrants in it just like a, you know, a Silicon Valley bank or a Comerica might give an adventure debt loan where the government actually could make money from this.
00:12:58 Speaker 2
And then you incent them with something.
00:12:59 Speaker 2
That is just too.
00:13:01 Speaker 2
Good not to take a 50 year loan of $5 billion to build factories.
00:13:05 Speaker 2
You have to use it.
00:13:06 Speaker 2
For that.
00:13:06 Speaker 2
So it’s use it or lose it and then you slowly pay the government back and then maybe we get some warrants in, in tallow.
00:13:12 Speaker 2
Whoever gives the money to this is something that Obama did with Calandra Solyndra, which didn’t work out, but he also did it with Tesla.
00:13:19 Speaker 2
And Tesla paid all that money back early.
00:13:21 Speaker 2
These loans that.
00:13:22 Speaker 2
The Department of Energy did.
00:13:23 Speaker 2
Really did.
00:13:25 Speaker 2
And and you.
00:13:26 Speaker 2
Gotta give Barack Obama a lot of.
00:13:27 Speaker 2
Credit for this, it really did help.
00:13:30 Speaker 2
Drives even though it wasn’t perfect, it did drink a lot of EV adoption.
00:13:35 Speaker 2
It did really helped us to become the company it today.
00:13:39 Speaker 2
So I really just respond ’cause I, you know, I, I don’t know how much we’ve, we’ve gone through the details of the bill, but there are several components to this peril including and I just want to highlight if I’m on the Board of Intel.
00:13:51 Speaker 2
I’m not going to make a $10 billion fab investment.
00:13:55 Speaker 2
Because, you know, there’s, there may or may not be, you know, profits down the road to justify that size of an investment.
00:14:01 Speaker 2
So if the government comes along and says we will support, we will cover X percent of that investment.
00:14:06 Speaker 2
I can take on more risk and I’m more willing to make that investment.
00:14:10 Speaker 2
And theoretically I can afford to pay people a higher wage or higher salaries.
00:14:10 Speaker 4
Thank you.
00:14:14 Speaker 2
Because I now have more capital freed up to support to do.
00:14:17 Speaker 2
That and so.
00:14:18 Speaker 2
There is an effect that arises by having the government come in, put some money into these projects, accelerate their outcomes.
00:14:24 Speaker 3
And it gives me.
00:14:25 Speaker 2
The business more cleaner.
00:14:26 Speaker 2
Should it be free birds, free money or in the form of a loan?
00:14:29 Speaker 2
So what should the financial device be?
00:14:31 Speaker 2
I think is the question that you asked facts, if I’m interpreting?
00:14:34 Speaker 2
Yeah, I’m not sure that the loan, because the loan doesn’t resolve the fact that they’re having to put up money, right.
00:14:39 Speaker 2
And so that they’re not necessarily going to make this ongoing investment.
00:14:42 Speaker 2
So the rational capitalist decision is to offshore manufacturing for Intel.
00:14:47 Speaker 2
It’s irrational for them from a business perspective, from a board perspective, from fiduciary perspectives to onshore man.
00:14:54 Speaker 2
So the reason they’re going to do it is not because they’re getting a loan where the interest rate is low.
00:14:58 Speaker 2
That doesn’t really solve the problem. It’s the government saying we’re going to put a $10 billion facility, we want you to build it and manage it for us, and that’s effectively what’s happening.
00:15:07 Speaker 2
And now, by building the $10 billion facility, we created security for the rest of the US industry. It’s worth it to the government to put that money out.
00:15:13 Speaker 2
No, no.
00:15:13 Speaker 2
We create security for our country.
00:15:17 Speaker 2
Why wouldn’t it create security if we, if we have more on Turing of Chip filling that space, more securities?
00:15:22 Speaker 2
One more thing.
00:15:22 Speaker 2
There’s also an investment tax credit self into.
00:15:24 Speaker 2
This bill fast which?
00:15:25 Speaker 3
Does provide overtime?
00:15:27 Speaker 2
A bunch of incentives to continue to support and drives the Onshoring work that’s proposed in the.
00:15:32 Speaker 2
Bill, if you want the United States.
00:15:33 Speaker 5
Point of personal privilege prior requests that add just one button to a shirt, yes.
00:15:39 Speaker 4
It’s special.
00:15:45 Speaker 1
Second to watch Jason do the gun show.
00:15:46 Speaker 2
He just walked here.
00:15:51 Speaker 1
Now I gotta watch.
00:15:52 Speaker 1
The boss you know.
00:15:53 Speaker 2
Your grudge.
00:15:54 Speaker 2
Before that’s even, show us what you want, old man arms, you guys.
00:15:56 Speaker 5
All right, let’s move on.
00:15:57 Speaker 5
Let’s move on.
00:15:58 Speaker 2
I want to say one more thing about the.
00:15:59 Speaker 2
Pelosi stuff, so.
00:16:00 Speaker 1
Here’s the data.
00:16:01 Speaker 2
I don’t know if you guys have looked at the full history of the Pelosi training data.
00:16:04 Speaker 2
Here’s below.
00:16:05 Speaker 2
This is all the training that’s happened over the last couple of years.
00:16:08 Speaker 2
So, and over the past year he has bought NVIDIA four different times, each time in this same kind of volume range.
00:16:16 Speaker 2
So the timing certainly may appear substance and it’s certainly terrible kind of thing to see.
00:16:20 Speaker 2
He’s also bought.
00:16:21 Speaker 2
Apple in the last month, Microsoft writing soulful.
00:16:25 Speaker 2
He bought Microsoft.
00:16:26 Speaker 2
He bought Alliance Bernstein earlier in the year.
00:16:29 Speaker 2
He made a few crates this year, but NVIDIA?
00:16:31 Speaker 2
He’s actually bought on four different occasions over the past.
00:16:31 Speaker 3
Right.
00:16:33 Speaker 2
12 month for whatever that’s worth, right?
00:16:36 Speaker 2
I’m not not trying to defend it, but I think we should be intellectually honest about the fact that this guy, you know, it does take points of view in certain companies he praised in handful of.
00:16:42 Speaker 2
Are we, are we going to be intellectually honest enough to think that the husband talks to his wife and vice versa?
00:16:51 Speaker 2
Or does that not happen anymore?
00:16:53 Speaker 2
Depends on.
00:16:53 Speaker 2
The husband and wife.
00:16:54 Speaker 2
But yeah, I think this is.
00:16:56 Speaker 5
Blatant and out in the open.
00:16:58 Speaker 5
I mean, it looks really at a minimum.
00:16:59 Speaker 5
The appearance is of graft and corruption and.
00:17:00 Speaker 3
Looked at.
00:17:02 Speaker 2
Yeah, the appearance of impropriety is impropriety.
00:17:04 Speaker 2
They shouldn’t be allowed to trade.
00:17:06 Speaker 2
They should have to put their stuff into blind trusts.
00:17:08 Speaker 2
Or they should maybe trade once a year and they should have to announce their trades before the trace happen.
00:17:13 Speaker 2
Hey, here’s what.
00:17:13 Speaker 2
I’m planning on doing.
00:17:14 Speaker 2
Just like a CEO is planning on doing this stuff, it it’s ridiculous that.
00:17:18 Speaker 2
They can do.
00:17:18 Speaker 2
Why doesn’t the mainstream media cover?
00:17:23 Speaker 2
And Jason, do you think he said it happened during Trump?
00:17:24 Speaker 3
We have.
00:17:27 Speaker 2
We would have a lot more coverage than this pillow commuted in limbo.
00:17:29 Speaker 2
On Trump.
00:17:31 Speaker 5
It really doesn’t get covered.
00:17:32 Speaker 5
I mean, you just search for it today, you’ll see basically the only media outlets covering it on.
00:17:36 Speaker 5
Like Fox News?
00:17:37 Speaker 5
And then zero hedge, you know, that’s it.
00:17:41 Speaker 5
I mean, that’s how.
00:17:42 Speaker 5
I found out about it is like 0 hedge tweets.
00:17:44 Speaker 2
About it so, Daily Beast, you know, headline.
00:17:47 Speaker 5
You can watch the game fast.
00:17:48 Speaker 2
7 hours ago, gems quietly tried to jam Pelosi on stock trading ban.
00:17:52 Speaker 2
But if you’re asking me, you ask me a question.
00:17:53 Speaker 2
The truth is the media largely biased against Trump and gives a free pass to the dense.
00:18:00 Speaker 2
Yes, I would say that that is the trend, yes.
00:18:02 Speaker 2
I think that is incorrectly on this review.
00:18:05 Speaker 2
Well, no, I I mean I think the media is bankrupt, is just.
00:18:07 Speaker 2
Going for clicks.
00:18:07 Speaker 2
Then I think, you know, we’ve talked about this before.
00:18:10 Speaker 2
They saw Trump as an existential risk and they just did whatever it took to get him out of office, even putting.
00:18:17 Speaker 2
So they completely burned all of their.
00:18:18 Speaker 3
They lost a.
00:18:19 Speaker 2
Credibility, you know, and now the.
00:18:21 Speaker 2
Gems are starting to become increasingly.
00:18:24 Speaker 2
Detached and out of touch, and maybe he did, but then the result is that the mainstream media is just.
00:18:29 Speaker 3
No longer.
00:18:29 Speaker 3
The media and the.
00:18:30 Speaker 5
Democratic Party both have the same problem which is they suffer from what the democratic local scientists voici share is called professional class hegemony.
00:18:40 Speaker 5
I means that they are populated by college graduates with degrees who basically have this that very elitist, progressive agenda.
00:18:48 Speaker 5
And that is what is causing the democratic working class to defect from the Democratic Party, their historical base, in droves.
00:18:56 Speaker 5
Look at Hispanics.
00:18:57 Speaker 5
So, first of all, if.
00:18:58 Speaker 5
You go to.
00:18:58 Speaker 5
The latest Biden polling numbers, he’s down to 31% approval, 60% disapprove. OK, so the trend is getting worse there, but you look at Hispanic sits down.
00:19:08 Speaker 5
To 19% approval, 70% disapproval. It’s an even more intense version of the same problem you had Mira Flores get elected in that Texas fee. This is a district that went it’s basically a predominantly.
00:19:22 Speaker 5
Mexican American district, they went for Biden by 18 points just, you know, two years ago and now they’re voting for her by over 10 points.
00:19:31 Speaker 5
So you’re Republicans winning that seat for the.
00:19:33 Speaker 5
First time, so you have.
00:19:34 Speaker 5
These huge defections out.
00:19:36 Speaker 5
Why is that happening?
00:19:37 Speaker 5
Because the Democrats are appealing to the donor class on issues like border, on issues like crime.
00:19:44 Speaker 5
And on issues like CRT and schools, I mean, you know the.
00:19:50 Speaker 5
Working class people in this country, they don’t want open borders, they want crime to be prosecuted and crack down on, and they do not want any ideological education for their kids.
00:20:00 Speaker 5
OK, it’s very simple, but that basically is why there are three parties losing.
00:20:04 Speaker 5
Losing votes.
00:20:05 Speaker 5
Now we can recall other examples of the Democrats simply appealing to this sort of.
00:20:09 Speaker 5
Donor class so.
00:20:11 Speaker 5
Recently there’s an article about the Democrats.
00:20:14 Speaker 5
Have spent 44.
00:20:16 Speaker 5
$1,000,000 this election cycle basically running ads in favor of the crazy maggot candidate in primaries. There’s been a bunch of reports of this where in competitive Republican primary the Democrats will actually spend money on.
00:20:31 Speaker 5
Behalf of the.
00:20:32 Speaker 5
Sort of the more perceived crazy Republican market senator.
00:20:35 Speaker 3
The crazy from the magazine.
00:20:36 Speaker 5
See elections and higher and so forth because of the perceptions will be easier to beat in the general.
00:20:42 Speaker 5
But I think this is a case to be careful what you wish for because you know if you have a red wave in November, you’re going to end up with more of these candidates basically win.
00:20:50 Speaker 4
OK.
00:20:51 Speaker 5
So it’s a very cynical strategy.
00:20:53 Speaker 5
The other example, I think a very simple strategy is you saw there was a vote in the House this past week on gay marriage and the House voted to repeal DOMA, the Defense of Marriage Act in support basically codifying Obergefell right.
00:21:10 Speaker 5
The true source decision on.
00:21:12 Speaker 5
On gay marriage?
00:21:14 Speaker 5
Something like, you know?
00:21:15 Speaker 5
60 Republicans voted for it.
00:21:17 Speaker 5
Look, I would have liked to have seen more.
00:21:18 Speaker 5
Republicans vote for this.
00:21:20 Speaker 5
I think it should be like, you know, majority of parking price replacements.
00:21:23 Speaker 5
But the point is that is there any intention of the Democrats to bring this up in the Senate and pass it and codify obergfell when they have a chance?
00:21:31 Speaker 5
I think the answer is no.
00:21:33 Speaker 5
Because the Democrats rather fundraise off this.
00:21:35 Speaker 5
The same thing is true about Rose.
00:21:37 Speaker 5
The Democrats had super.
00:21:38 Speaker 5
Majorities in the South.
00:21:41 Speaker 5
Under Obama, they could have caught if I drove.
00:21:43 Speaker 5
They never took the chance.
00:21:44 Speaker 5
Because they would rather fundraise off this issue from progressive elites, the donor class in California, in New York.
00:21:52 Speaker 5
So This is why they’re not going to contact live so far, so absolutely.
00:21:55 Speaker 2
Obama also record Obama, was asked why were you not?
00:21:59 Speaker 2
He campaigned on codifying Roe V Wade and then very quickly into it.
00:22:04 Speaker 2
He was asked when he had the Super majority in both the house and the Senate, where you last unwieldy rating goes.
00:22:09 Speaker 2
No, it is not a priority anymore.
00:22:11 Speaker 3
Not the proper.
00:22:12 Speaker 5
It absolutely could have been quantified, just like a reverse shell to be quantified tomorrow.
00:22:16 Speaker 5
Conservative estimates there are there are ten Republican votes.
00:22:19 Speaker 5
There are ten Republican votes at least for this in the Senate.
00:22:22 Speaker 5
University filibuster proof keep majority in the Senate.
00:22:26 Speaker 5
Who would support this?
00:22:27 Speaker 5
The same Republicans who supported the gun restriction bill that binds aside and their support of the infrastructure built.
00:22:34 Speaker 2
You think they should codified more civil rights in this country, right?
00:22:36 Speaker 2
Now if they want.
00:22:37 Speaker 5
No, that that moment is past that moment pass.
00:22:40 Speaker 5
I’m not saying.
00:22:40 Speaker 2
Republicans would never.
00:22:41 Speaker 2
Give women the right.
00:22:42 Speaker 5
No, no, look, there’s also a majority in the Senate anymore for for, qualifying wrote.
00:22:46 Speaker 5
There is a super majority right now for codifying the version.
00:22:49 Speaker 4
For any.
00:22:50 Speaker 5
They could do that right now.
00:22:51 Speaker 5
Yeah, they’re not.
00:22:52 Speaker 2
Timothy, you’ve been a donor to the Democratic Party.
00:22:54 Speaker 2
You believe that?
00:22:57 Speaker 2
Do you believe that the abortion issue drove you and others to put more money in?
00:23:02 Speaker 2
And that’s maybe not kind of.
00:23:04 Speaker 2
The leadership of the Democratic Party.
00:23:08 Speaker 2
Focused on Trump.
00:23:10 Speaker 2
In the last big cycle, it was all Trump, Trump, Trump, Trump, Trump.
00:23:14 Speaker 2
Do I think that more grassroots fund raising focuses on that or gun rights?
00:23:21 Speaker 2
But even without just saying, it’s true that they actually held off on trying to codify Roe so that they could continue to.
00:23:26 Speaker 2
Again, I’m just, I’m just going to give you the quote because there’s there’s no opinion needed, OK, April 29th of 2009, President Barack Obama says on Wednesday.
00:23:37 Speaker 2
He favored abortion rights for women, but by passing a law guaranteeing these rights were not as.
00:23:41 Speaker 2
Cropped top priority.
00:23:44 Speaker 2
I believe that women should have the right to choose, Obama told the news conference, marking his first 100 days in office again when he had super majorities in both sides.
00:23:51 Speaker 2
But I think that’s the most important thing we can do to tamp down some of the anger surrounding this issue is to focus on those areas we can complete on.
00:23:58 Speaker 2
So you make a promise.
00:24:01 Speaker 2
You get into the seat of power, you have the decision on what your legislative agenda should be, and he made that calculation.
00:24:09 Speaker 2
And David is right, sadly, that it was in a moment where we had a clear line of sight to codifying many of these rights.
00:24:17 Speaker 2
Yeah, but the question is free bird.
00:24:19 Speaker 2
Hold on, hold on, hold on.
00:24:19 Speaker 5
Put in your file.
00:24:20 Speaker 2
That’s not the question that Freberg exactly he’s saying.
00:24:22 Speaker 2
Do you think that they specifically did this to keep it as an open issue to raise money off but?
00:24:27 Speaker 2
I don’t think that’s believable.
00:24:27 Speaker 5
Oh yeah, absolutely. Absolutely. Because.
00:24:28 Speaker 2
No way, no way.
00:24:29 Speaker 2
And if you want to talk about cynicism, facts, the truly cynical moves was, you know, Trump saying I am going to get this in.
00:24:37 Speaker 2
Evangelical vote to win the primaries to get those 20% who want to take away the rights for women to have an abort.
00:24:44 Speaker 2
And I’m going to stack the Supreme Court to.
00:24:46 Speaker 5
Act now.
00:24:47 Speaker 2
Eat that all.
00:24:47 Speaker 5
Hold on a second.
00:24:48 Speaker 2
That’s the most cynical of all.
00:24:48 Speaker 5
Let let’s define.
00:24:49 Speaker 5
Terms let, let’s just.
00:24:49 Speaker 2
Of this political stuff.
00:24:50 Speaker 5
OK, let let’s define terms.
00:24:50 Speaker 2
Well, let’s say you want to go political.
00:24:52 Speaker 5
So hold on a second, one second.
00:24:54 Speaker 5
Let let’s define.
00:24:54 Speaker 5
Terms so you.
00:24:56 Speaker 5
May be opposed to what Trump did, but there wasn’t.
00:24:59 Speaker 5
That was a cynical he stated what he was going to do when he had his office, and then he did it.
00:25:03 Speaker 5
He lived up to his promise, hearing, hearing.
00:25:04 Speaker 3
Yeah, but somebody who?
00:25:05 Speaker 2
Did not believe in that.
00:25:06 Speaker 4
What he did.
00:25:06 Speaker 2
He did not believe in that.
00:25:08 Speaker 2
He did it specifically to get those votes. We all know he didn’t believe in it. We all know he believes that a woman’s right to choose.
00:25:13 Speaker 2
Patient he he created a platform to get elected, and then when he was elected, he executed on that platform.
00:25:20 Speaker 2
I think what David Sachs is saying is Obama had a platform to get him elected and when Obama chose passive choice, he chose to not execute on the platform.
00:25:21 Speaker 3
Yes, that’s interesting.
00:25:29 Speaker 2
And that is also true.
00:25:31 Speaker 2
And all interesting is the over to ourselves.
00:25:33 Speaker 2
Be intellectually honest about what happened that way or what happened, OK?
00:25:37 Speaker 2
Both of these two guys made.
00:25:38 Speaker 2
Claims hold on one second.
00:25:40 Speaker 2
Two guys made.
00:25:40 Speaker 2
Yeah, exactly your own.
00:25:42 Speaker 2
But sure I understand.
00:25:43 Speaker 2
So sinces I want this on the road.
00:25:45 Speaker 2
Both of these two guys made claims to become president.
00:25:49 Speaker 2
Turns out that Trump.
00:25:49 Speaker 2
Actually did execute on most of his claims, as important as a word of some, and Obama on some of the most important issues of our just times did not.
00:25:58 Speaker 5
What Trump did was simple coalition politics.
00:26:01 Speaker 5
He thought it was important to win the religious right.
00:26:03 Speaker 5
He basically appealed to them.
00:26:05 Speaker 5
He said that if you vote for me, I will nominate these judges again.
00:26:07 Speaker 2
Many represent.
00:26:08 Speaker 1
His office, he delivered.
00:26:10 Speaker 1
He delivers.
00:26:10 Speaker 2
And he.
00:26:10 Speaker 2
Done both fitting themselves, right?
00:26:12 Speaker 2
So that’s what.
00:26:12 Speaker 2
I’m talking about.
00:26:13 Speaker 4
It doesn’t matter.
00:26:14 Speaker 5
It doesn’t matter.
00:26:14 Speaker 2
Well, it matters to me.
00:26:15 Speaker 5
That’s not my fault.
00:26:15 Speaker 2
I believe people should have appreciated principles.
00:26:17 Speaker 5
OK, look, you’re here.
00:26:17 Speaker 2
So I know it doesn’t matter to you that these guys have principles, but it matters to me that people.
00:26:21 Speaker 2
You need to have the principle of saying that he’s going to, he’s going to pass and codify Roe V Wade and not doing what exactly.
00:26:29 Speaker 2
I tti, but listen, I the quote you gave doesn’t give why he didn’t do it.
00:26:33 Speaker 2
He didn’t make it a priority.
00:26:33 Speaker 3
He did.
00:26:34 Speaker 2
It could also hold.
00:26:35 Speaker 2
On let.
00:26:35 Speaker 2
Me finish.
00:26:36 Speaker 2
It could also be that he believed that it would not get overturned, so he should spend his time on Obamacare and other things.
00:26:44 Speaker 2
I’m saying cynicism is when you believe one thing and then you do something to active your own self-interest.
00:26:48 Speaker 2
And that’s what I’m saying.
00:26:49 Speaker 5
So that’s what I think Trump did.
00:26:50 Speaker 5
One second.
00:26:51 Speaker 5
We don’t need to go back all the way to the Obama administration, because the issue I’m talking about today is that in the past week they had a vote codifying Obergefell on gay marriage and repealing DOMA.
00:27:03 Speaker 5
OK, so now listen.
00:27:04 Speaker 5
I actually think there were so many Republican votes in the house, even though I would have liked to see more.
00:27:08 Speaker 5
There were enough that that this might shame Schumer ends up bringing up the vote because he’s so obvious, if he.
00:27:15 Speaker 5
Wasn’t that he?
00:27:17 Speaker 5
Is doing this for a reason right?
00:27:18 Speaker 5
Because they have.
00:27:19 Speaker 5
The votes, they can pass this just like they pass the gun bill a few weeks ago, right?
00:27:24 Speaker 5
Just like they passed the infrastructure bill, so if Schumer doesn’t bring this up, it’s a very simple move and.
00:27:29 Speaker 2
You think it’s strategically to have that effort issue to fresh funding.
00:27:31 Speaker 4
Of course.
00:27:33 Speaker 2
I I get it if you if we’re gonna.
00:27:33 Speaker 5
Of course.
00:27:35 Speaker 5
And it’s really true.
00:27:36 Speaker 5
Listen, do you think that?
00:27:36 Speaker 2
Treating both sides arsenik.
00:27:39 Speaker 5
Of course, the closures engage in politics.
00:27:40 Speaker 3
OK, so.
00:27:41 Speaker 5
However, however, when I’m talking about such type of cynicism, so I think that there’s a lot of issues on which the Democrats would rather appeal to the donor class, basically that lives on the coast in New York, California, and be able to keep fund raising on that issue and basically scaremonger on that issue instead of just.
00:27:59 Speaker 5
Winning the issue, they can just.
00:28:01 Speaker 5
Win this issue right now.
00:28:02 Speaker 2
Thomas, do you have less interest in supporting the Democratic Party based on the principle you stated that in the past there have been kind of promises and capital raise?
00:28:12 Speaker 2
Yes, you know, codifying Roe and then it’s not.
00:28:15 Speaker 2
Well, they never made those promises to me, so I never felt like they lied to me.
00:28:20 Speaker 2
I want to be very clear so they nobody and I never asked for that to be a precondition of my donation.
00:28:26 Speaker 2
Again, my capital was focused on one thing, which is I thought that President Trump was not the right person to meet this country.
00:28:34 Speaker 2
And I thought very clearly that the bright Democrat could do a much, much.
00:28:37 Speaker 2
Better job and I am.
00:28:39 Speaker 2
Glad that Biden won.
00:28:41 Speaker 2
And I’m glad that the money that I put in may be no in any small way, but hopefully in some reasonable nontrivial way helped.
00:28:49 Speaker 2
And I’m glad that that money helped even out to send it.
00:28:52 Speaker 2
I’m glad all of those things happened, and so I want to be clear.
00:28:55 Speaker 2
They’ve never made those kinds of promises to be, nor have I ever asked.
00:28:59 Speaker 2
I make a high level decision on who I think.
00:29:01 Speaker 2
That candidates should be and support supporting that will get that best candidate.
00:29:05 Speaker 2
Affected what I?
00:29:05 Speaker 2
Was just trying to make clear to you.
00:29:08 Speaker 2
Is that sometimes even Democrats, it’s important for us to be intellectually honest about what has happened.
00:29:16 Speaker 2
It’s very easy to look at the other guy and find.
00:29:19 Speaker 2
All the ways.
00:29:20 Speaker 2
In which they screwed up, or try to screw you, or you know, is is in a lacks empathy or lack empathy.
00:29:26 Speaker 2
All of these things.
00:29:27 Speaker 2
It’s much harder oftentimes.
00:29:29 Speaker 2
Look at your own team and say, wait a minute, why didn’t XY&Z happen? And the reason I’m bringing up what happened in 2009 is I think David is.
00:29:36 Speaker 2
Right, we have.
00:29:37 Speaker 2
A moment in time where the leadership of the Democratic Party.
00:29:42 Speaker 2
Can codify rights that should be codified and they should have.
00:29:47 Speaker 2
In hindsight, they should have done it and it, just to be clear.
00:29:48 Speaker 2
It is still open.
00:29:51 Speaker 2
Well, I’m talking about Roe V Wade, and yes, and for the for the issue we’re talking about now, it should be caught.
00:29:52 Speaker 4
It for us.
00:29:56 Speaker 2
If I’d absolutely this should be clear. I’m an independent. I would vote for a Republican who was socially progressive and fiscally conservative as long as there for Gator marriage or loans or pro women’s right to choose.
00:30:06 Speaker 2
And they were fiscally conservative.
00:30:08 Speaker 2
I would vote for a Republican.
00:30:09 Speaker 2
I’m a moderate, independent.
00:30:10 Speaker 2
I want only less government and more efficient government.
00:30:13 Speaker 2
And I want people, I want the government out of people, personal lives.
00:30:16 Speaker 2
And I think that’s.
00:30:16 Speaker 2
Where Saxon I are.
00:30:17 Speaker 2
Exactly the same we both want.
00:30:19 Speaker 2
I mean tax, do you want the government involved in?
00:30:21 Speaker 2
People, personalize your classic Republican.
00:30:22 Speaker 5
5195 hundred.
00:30:23 Speaker 2
By the way, according to the.
00:30:24 Speaker 1
Monmouth poll from a few weeks ago.
00:30:27 Speaker 2
You represent 4% of the voting base. I didn’t exclude. Yeah, that’s an extreme minority that the the lowest.
00:30:36 Speaker 2
Self identifying quadrant of fiscal conservatives versus kind of fiscal liberal social conservative social liberals is the fiscal conservative social liberal.
00:30:46 Speaker 2
What are we all here?
00:30:47 Speaker 2
We’re, I think we all fit this profile physically.
00:30:49 Speaker 2
We want the government to be run conservatively, you know, and with less government.
00:30:54 Speaker 2
And we want progressive.
00:30:55 Speaker 3
Social change, right?
00:30:57 Speaker 3
And I think.
00:30:57 Speaker 2
We all feel that was totally.
00:30:58 Speaker 2
Against Government people program.
00:30:59 Speaker 4
I I wouldn’t.
00:31:00 Speaker 2
I’m just asking, I’m asking you.
00:31:02 Speaker 2
Guys, if we’re all In Sync.
00:31:03 Speaker 5
Define my cultural positions as progressive social change.
00:31:06 Speaker 5
Because that change, that progressives.
00:31:07 Speaker 5
Are trying here right now is radical.
00:31:07 Speaker 3
OK. Yeah.
00:31:09 Speaker 5
Where I favour is social.
00:31:11 Speaker 5
I think their tolerance maybe a tolerant society.
00:31:11 Speaker 2
OK, explain what that is.
00:31:14 Speaker 5
America is a very broad, diverse country.
00:31:16 Speaker 5
We need to find ways to live together and find accommodation on issues that are very contentious.
00:31:22 Speaker 5
That includes tolerance for gay marriage.
00:31:24 Speaker 5
So look, I’m on board with that.
00:31:26 Speaker 5
But you know.
00:31:27 Speaker 5
This radical is that progressive agenda, social change, which includes.
00:31:31 Speaker 5
Upending the criminal justice system in favor of non prosecution, what’s happening in the schools with CRT and the sort of hyper ideologized education look.
00:31:35 Speaker 2
No, don’t give up something like that.
00:31:42 Speaker 5
Additionally teaching the basics reading.
00:31:44 Speaker 2
Yeah, leave it up to parents to do.
00:31:45 Speaker 4
Math. That kind of.
00:31:46 Speaker 3
The other stuff I agree, right?
00:31:46 Speaker 5
Yeah, exactly.
00:31:47 Speaker 5
And so on down the line.
00:31:48 Speaker 2
But maybe progressive is the wrong term ’cause that that now has been Co opted.
00:31:52 Speaker 2
Less government involved in your personal life and tolerance.
00:31:55 Speaker 2
I think we all agree on that, and I think we’re all for existence.
00:31:58 Speaker 2
Everybody agrees with tolerance.
00:31:59 Speaker 2
It’s a privileged position to want.
00:32:01 Speaker 2
To have less government involved in your life, right?
00:32:03 Speaker 2
I mean, many people in the United States have been able to thrive and survive because of the role that government has played in their.
00:32:10 Speaker 2
Lives and theirs.
00:32:12 Speaker 2
Obviously on one end of the spectrum, extreme correct?
00:32:16 Speaker 2
And on the other end of the spectrum, extreme need that is being met by the wealthiest government in the world.
00:32:23 Speaker 2
And it is a that you know it is in that middle where.
00:32:26 Speaker 2
Where do you stand for those? How would you describe your politics in these two dynamics? Right you are you also in this 4%?
00:32:40 Speaker 2
Yeah, yeah, yeah.
00:32:41 Speaker 2
No, I’m.
00:32:41 Speaker 2
I’m here.
00:32:43 Speaker 2
But I’m trying to be thoughtful about this.
00:32:44 Speaker 3
Because yeah, yeah, yeah.
00:32:47 Speaker 2
I think that the government’s role is to support those in need, not those in what, and I think that the government should be held accountable for performing that role.
00:32:58 Speaker 2
And I think that those of us who care that are sitting in privileged positions and seats should enable the government to perform that role well and we should be positive.
00:33:09 Speaker 2
Actors meaning we should support, we should pay taxes, and we should help people and institutions in need.
00:33:18 Speaker 2
And that are, you know, kind of for the greater good.
00:33:20 Speaker 2
And then we could be holding ourselves, our government and our politicians to account for inefficiencies.
00:33:26 Speaker 2
And the biggest concern I have is less about other people in need needs being met as much as we holding our government to account for the performance of its services and you need to the American people and I don’t think we are.
00:33:38 Speaker 2
I like this want need concept here.
00:33:40 Speaker 2
Can you give an example?
00:33:41 Speaker 2
Of where the government like people need something, but then there’s another group that wants something and maybe we’re.
00:33:47 Speaker 2
Over stretching and and you know.
00:33:48 Speaker 2
Giving into wants when we should.
00:33:51 Speaker 2
Be focused on needs and efficiency.
00:33:52 Speaker 2
Yeah, I’ll give you a pretty.
00:33:55 Speaker 2
Example I know reasonably well, which is the farm bill passes every four years.
00:34:00 Speaker 2
And the farm bill in order to get a task in both the House and the Senate.
00:34:04 Speaker 2
It has components that serve both farmers and support the food stamp program.
00:34:11 Speaker 2
So the food stamp program obviously supports millions of Americans that are in need of food, can’t afford food, they get EBT cards, they get support in buying food, and there’s a lot of programs and assets that are enabled by that program.
00:34:22 Speaker 2
But in order for that mostly services the needs of urban.
00:34:25 Speaker 2
Areas of cities.
00:34:26 Speaker 2
So it passes that that that element of the bill is attractive and appealing to the representatives of cities found in.
00:34:32 Speaker 4
The house.
00:34:32 Speaker 2
On the other side, in order to get a.
00:34:34 Speaker 2
Task in the Senate.
00:34:35 Speaker 2
Where the majority of senators come from.
00:34:37 Speaker 2
Rural states which are has significant farming populations.
00:34:41 Speaker 2
The farming subsidies are planted in that same bill and as a result, because everyone getting something, that bill as a whole has now grown to a multi $100 billion.
00:34:52 Speaker 2
Bill that gets passed every few years because in order for the Senate to pass, it’s the House says, OK, we’ll give you all these farm subsidies in order for the House that passes the Senate says, well, sorry, and vice versa, right?
00:35:02 Speaker 2
Will be only food stamps.
00:35:03 Speaker 2
But but both of them now have incredible what do they call this pork or?
00:35:07 Speaker 2
Fat or whatever, yeah.
00:35:09 Speaker 2
The amount of money that’s wasted that isn’t actually servicing the original intention in need of either of the parties that are represented by that bill is extraordinary.
00:35:18 Speaker 2
And I spent a lot of time in the farm, though I actually went with lobbyists years ago to DC and I actually met with the Senate and House ad committees.
00:35:26 Speaker 2
I’ve gone very deep into the bill and some of the programs in that bill.
00:35:29 Speaker 2
And it’s just shocking to me in the same way that Palmer Luckey shared and are all in summit, how shocking it is, how defense spending works in this country.
00:35:35 Speaker 2
It’s shocking.
00:35:35 Speaker 2
To me, how some of the?
00:35:38 Speaker 2
The programs work in the farm bill, how much money and how much waste there is, how much grip there is.
00:35:43 Speaker 2
And so yes, we are meeting the needs of populations in need in this country, but so much more of the bill now is about people wanting more in order to pass the dollars.
00:35:50 Speaker 2
And it’s bloated, but so.
00:35:52 Speaker 2
A permanent fix because where’s the incentive for any black woman?
00:35:52 Speaker 1
How many?
00:35:55 Speaker 2
And cut that.
00:35:56 Speaker 2
Grow up, working incentive to fix ’cause both sides are barbelin McGriff, then there’s no incentive they’re they’re they’re in a dance to to maximize the grift.
00:36:04 Speaker 2
Waiting stand now if we if we were to sort of look at politics without the Biden and Trump Derangement syndrome, without the the the tribalism just in terms of first principles.
00:36:14 Speaker 2
I think what we’re seeing here is we all want to see radical confidence in the government, social issues, right?
00:36:20 Speaker 2
You know, and physically how we run the country.
00:36:22 Speaker 2
Where do you stand?
00:36:23 Speaker 3
You describe yourself now.
00:36:26 Speaker 2
But I mean, I think of.
00:36:28 Speaker 3
Things in terms of risk.
00:36:31 Speaker 3
Here’s what I see.
00:36:34 Speaker 2
I see that there are a handful of issues that remain in terms of social policy that just need to get codified.
00:36:47 Speaker 2
Gay marriage is an example of 1.
00:36:49 Speaker 2
Abortion rights is an example of the other.
00:36:52 Speaker 2
Then and I think those are like really.
00:36:57 Speaker 2
To mark my perspective speaks about human individual liberty, which I think should Trump everything.
00:37:04 Speaker 2
So everybody should be allowed to kind of pursue the best version of themselves.
00:37:10 Speaker 2
However that manifests in the person he married to in in the gender you express, not be relaxing.
00:37:17 Speaker 2
For what you do to be.
00:37:19 Speaker 2
Happy you should be.
00:37:19 Speaker 3
Allowed to be period in this story.
00:37:22 Speaker 2
Then there are issues where I think are much thornier, and as I get older, I become increasingly ambivalent or confused.
00:37:31 Speaker 2
Actually is a better word, and gun control is a perfect example of that.
00:37:36 Speaker 2
I don’t know.
00:37:38 Speaker 2
What my right is to go and adjudicate a change to the Constitution.
00:37:42 Speaker 2
That’s the mirror since the founding of this country.
00:37:45 Speaker 2
That’s a much more complicated issue.
00:37:47 Speaker 2
And so I think we have to basically devolve that right to the states where individual states will have very different laws as part of how you choose to express where you live will be defined.
00:37:58 Speaker 2
Like some of those rules.
00:38:00 Speaker 2
So that’s the full size.
00:38:02 Speaker 2
Extreme tolerance is really how I would sum it up.
00:38:02 Speaker 4
Got it.
00:38:06 Speaker 2
Economically so, but I think the risk to America.
00:38:12 Speaker 2
In floating quote UN quote because of an issue in that surface area, in my opinion is extremely limited.
00:38:19 Speaker 2
If I look on the economic lens, however, I think there are enormous risks.
00:38:24 Speaker 2
To American leadership and exceptionalism.
00:38:27 Speaker 2
And we need a wholesale recess of how we create incentives, of how governments should work, of how regulatory capture should work, of how the capital markets work.
00:38:40 Speaker 2
These rules are way too perverted.
00:38:43 Speaker 2
And it’s creating enormous stress in the system.
00:38:49 Speaker 2
And again I go back to the example I.
00:38:50 Speaker 2
Used last episode.
00:38:54 Speaker 2
The thing that if you look for example, like, you know in that example of Sri Lanka, Singapore, Jamaica and how there were these three completely different outcomes.
00:39:04 Speaker 2
Underneath the most successful outcome with an incredibly clear, transparent and simple financial framework.
00:39:12 Speaker 2
You cannot spend more than you have.
00:39:15 Speaker 2
You need to invest in long term programs like education and health care.
00:39:19 Speaker 2
You need to make them broadly available.
00:39:21 Speaker 2
And then you have an absolute free market that gets the best ideas to the top of the funnel.
00:39:27 Speaker 2
And if you can just incorporate those things, the task block could be 4.
00:39:30 Speaker 2
Pages, you know.
00:39:33 Speaker 2
The the number of regulations could be 50 pages.
00:39:37 Speaker 2
You know the simple rule that says to the Federal Reserve, we can’t just print free money ad hoc.
00:39:45 Speaker 2
So I’m I’m much more concerned about the fiscal future of America.
00:39:48 Speaker 2
I I think that there’s so much.
00:39:50 Speaker 2
Movement is progress on the social sides, including the freedom of movement of people to different states.
00:39:58 Speaker 2
It is an important set of issues, but in terms of what drives the outcome and future success for our case under Texas kids, people should not sleep on the economy ’cause.
00:40:07 Speaker 2
If we get this wrong, that will be the finger box that lights everything on fire.
00:40:13 Speaker 2
Facts when you hear you know everybody, sort of explain their basic belief system.
00:40:19 Speaker 2
How far apart you think we all are on this podcast?
00:40:21 Speaker 2
Because anyway, it’s been a additional receive.
00:40:23 Speaker 2
A lot of the fans discussing you and I discussing it feels like on most of these issues, and I think that’s people asking how I’m friends with you all the time, and I’m sure you get that question as well.
00:40:33 Speaker 2
Yeah, I love you like a brother.
00:40:35 Speaker 2
And I know I I love sex like a brother.
00:40:37 Speaker 2
And anytime we talk about basic issues, we’re very much In Sync.
00:40:40 Speaker 2
And then when we talk about politics, it feels like.
00:40:42 Speaker 2
We’re super, you know?
00:40:44 Speaker 2
You know, opposed, you know, and in opposition to each other when you hear that we all have essentially the same stack of fundamental beliefs.
00:40:53 Speaker 2
How, how do you interpret this in terms of politics and America writ large and and and how do we get consensus in this country to be more effective in running the?
00:41:02 Speaker 2
Country for the citizens.
00:41:04 Speaker 5
I think the media drives a lot of polarization, right?
00:41:06 Speaker 5
Because they’re feeding.
00:41:07 Speaker 5
Us a bunch of bogus narratives.
00:41:08 Speaker 5
You look at the polling around, the trust in the traditional media has absolutely plummeted through the floor.
00:41:14 Speaker 5
I mean they basically have it says, just reporting objectively the facts they.
00:41:19 Speaker 5
I think the audience is recognized.
00:41:21 Speaker 5
That they are activists they are.
00:41:22 Speaker 5
Basically pushing an agenda.
00:41:24 Speaker 5
And they’re pushing a bunch of bogus narratives, and I think it does drive the polarization.
00:41:27 Speaker 5
So that’s part of it.
00:41:28 Speaker 5
To go back to you know what?
00:41:30 Speaker 5
What are the core issues that motivate me and like who?
00:41:34 Speaker 5
I said.
00:41:35 Speaker 5
Or, look, I think we could probably agree.
00:41:37 Speaker 5
On a lot.
00:41:37 Speaker 5
Of stuff I want us to pursue more of an internationally cautious, you know, agenda, less interventionist, because it really hasn’t worked out for us very well in the last 20 years, all these wars that failed.
00:41:49 Speaker 5
I want it to be fiscally responsible and promote the healthy economy to much more exciting, uncertain, like us to be socially tolerant.
00:41:57 Speaker 5
Why does that leave me in this current environment to support Republicans well?
00:42:01 Speaker 5
On international, on Internet, also foreign policy, neither party is really very good.
00:42:06 Speaker 5
Both parties are sort of pushing some version of Bush doctrine light where we’re basically over involving ourselves in all these countries all over the world.
00:42:15 Speaker 5
But the Republicans at least have a faction that’s in favor of realism and restraints.
00:42:19 Speaker 5
So I’m trying to help kind of push.
00:42:22 Speaker 5
That direction within the party, the Democrats just are still very much in this liberal interventionist mode.
00:42:29 Speaker 5
On fiscal issues, both parties are guilty of overspending and creating this rudeness.
00:42:35 Speaker 5
Federal debt and deficits that we have, however.
00:42:38 Speaker 5
There’s no way to avoid the fact that their requests are just worse.
00:42:41 Speaker 5
I mean, Biden wanted.
00:42:43 Speaker 5
An extra 4.
00:42:44 Speaker 5
Trillion of spending on this whole build back better on top of the four trillion yet.
00:42:49 Speaker 5
So listen, I know the Republicans.
00:42:51 Speaker 5
Don’t have clean hands on this.
00:42:52 Speaker 5
Issue, but the progressives are just worse.
00:42:54 Speaker 5
As long as the progressives are calling the shots the Democratic Party, they’re just.
00:42:57 Speaker 5
Work on spending and then you got social tolerance, listened on the issues on these sort of key rights issues that have been the kind of the old social issue the last 50 years.
00:43:06 Speaker 5
By and large, not on all these things by and.
00:43:08 Speaker 5
Large on with you guys that.
00:43:10 Speaker 5
But I’m in favor of sort of the socially taller position.
00:43:14 Speaker 5
But look at who is pushing social intolerance today.
00:43:16 Speaker 5
I mean, different glass mirrors aren’t most intolerant group in America.
00:43:19 Speaker 5
They’re the ones pushing cancel culture.
00:43:21 Speaker 5
They’re the ones trying to serve their positions down the throats of ordinary Americans.
00:43:26 Speaker 5
This is what’s creating the backlash if you look at issues today like T like.
00:43:30 Speaker 5
The professor approach on five on borders the progression of China.
00:43:34 Speaker 5
So I think a social policy that is fundamentally intolerant and doesn’t accord any respect or room for traditional Americans live their lives the way they.
00:43:44 Speaker 5
Want to and?
00:43:45 Speaker 5
You have to be tolerant of them as well.
00:43:47 Speaker 5
We’re not going to have.
00:43:48 Speaker 5
Peed out Friday without.
00:43:49 Speaker 5
Some tolerance of the first ones.
00:43:49 Speaker 2
Can I say something?
00:43:51 Speaker 5
OK, let’s wrap.
00:43:52 Speaker 2
On this tonight and then move to China.
00:43:54 Speaker 2
Thank you, guys are this is a quote by Michael on a tweet from Mike Solana.
00:44:00 Speaker 2
The caption is I’ve been wondering how they were going to spin this and just feels exactly when David just said here.
00:44:06 Speaker 2
When the paper clip Yak poll came out and about.
00:44:10 Speaker 2
Approve, disapprove.
00:44:13 Speaker 2
About President Biden.
00:44:15 Speaker 2
You know, the big outlier was the Hispanic population, 19% of whom 70% disapproved. And the the article in the Washington Post, which tries to kind of.
00:44:27 Speaker 2
Sort of like clean this all up and whitewash, it, says fake news speaks many languages, but it’s particularly fond of Spanish.
00:44:35 Speaker 2
Essentially saying that, you know, the the fake news problem in the Spanish language has basically gotten so bad that, you know, this sort of explains why Hispanics have have.
00:44:46 Speaker 2
Moved in droves.
00:44:47 Speaker 2
And it’s like a whole race baiting cube shot article.
00:44:51 Speaker 2
But the point of all of this is just to show that the left.
00:44:55 Speaker 2
This is what really does kind of bombing out they are, they are probably more intolerant.
00:45:01 Speaker 2
Then they’ve ever been.
00:45:03 Speaker 2
They are tail terms, ’cause.
00:45:04 Speaker 2
It’s honesty.
00:45:05 Speaker 2
Like Rachel Maddow really wanted to increase her standing in position, she would just start the next program with Nancy Pelosi trades and say, Listen, we all know, let’s call this what it is.
00:45:14 Speaker 3
It’s not cool and.
00:45:16 Speaker 2
Here’s how it should change, I know, and I think that’s the disappointing part about all this.
00:45:17 Speaker 2
Never do it.
00:45:21 Speaker 2
OK, so let’s ship.
00:45:22 Speaker 2
Now I think we.
00:45:22 Speaker 3
Well, this is what.
00:45:23 Speaker 5
I say one final thing about this whole thing.
00:45:25 Speaker 5
We can move on, is I?
00:45:26 Speaker 5
I think I.
00:45:27 Speaker 5
Think if you are sort of purple and centrist I.
00:45:30 Speaker 5
Think the first two years.
00:45:31 Speaker 5
Of the bind administration, we’re really in this opportunity because I think there’s sort of this conventional wisdom that the parties are so polarized they can’t get anything done.
00:45:38 Speaker 5
I think we thought actually there’s enough Republican votes or they’re worrying that in the previous Congress, this current Congress, they got the infrastructure bill done, they got the gun build done here with the red flag laws and so forth that.
00:45:50 Speaker 5
We talked about.
00:45:51 Speaker 5
They can’t.
00:45:52 Speaker 5
The gap codification of gay marriage done if they want to, they could have done the electoral count asked reform.
00:46:00 Speaker 5
So spine has gone all the way with his depressive throwing rice agenda and just focused on reforming the Electoral count Act.
00:46:06 Speaker 5
Then you could have prevented a situation like we had on January 6th that that was.
00:46:12 Speaker 5
For tapping inside the Capitol, not outside.
00:46:14 Speaker 5
So there’s a lot of stuff they could have passed and they did it.
00:46:17 Speaker 5
Because the in the first half of this administration binds them completely captive to the progressives.
00:46:23 Speaker 5
There’s another thing as well.
00:46:24 Speaker 5
You get a child tax credit.
00:46:27 Speaker 5
Past you could get Romney would basically be the floor leader on that in the Senate.
00:46:31 Speaker 5
Take your pass and child tax credit.
00:46:33 Speaker 1
That’s the most popular.
00:46:34 Speaker 5
Part of Bob.
00:46:35 Speaker 5
Why don’t they peel that off and?
00:46:37 Speaker 5
Throw it on it because, uh, that’s right.
00:46:38 Speaker 2
Yeah, he said.
00:46:38 Speaker 2
The whole thing they can’t take.
00:46:39 Speaker 2
A holiday?
00:46:39 Speaker 5
The price is not holding it hostage saying that we’re not going to give that to you unless you do the whole enchilada.
00:46:44 Speaker 5
And of course there’s no votes for that.
00:46:45 Speaker 5
So I think.
00:46:47 Speaker 5
And and so who ultimately is the culprit?
00:46:49 Speaker 5
For allowing this faster well part we find, but also wrong claims chief of staff. I mean they’ve made uh instead of trying to get into the center they sort of realized, hey, we’re at 5050 president, right? I mean we have a 5050 Senate we should be triangulated. Is rebuilding a centrist coalition long frames that as getting ready for his lesson slides the train.
00:47:05 Speaker 2
Hydrate going, pulling Margaret machine.
00:47:08 Speaker 2
The body had a clear path to go right to the center.
00:47:11 Speaker 2
Pull everybody in full.
00:47:12 Speaker 2
The working class, and that’s been his supporting days with the working class.
00:47:15 Speaker 4
He is.
00:47:17 Speaker 2
And so he is and and he blows by going too far to the left.
00:47:20 Speaker 2
If he wants to save this Presidency, he should go straight to the middle and get all the working class behind him.
00:47:25 Speaker 3
Why do you think that?
00:47:25 Speaker 2
Anyway, for size, that went to some elite.
00:47:29 Speaker 2
You know East Coast liberal arts school.
00:47:32 Speaker 2
We got a.
00:47:33 Speaker 2
Masters in, you know, Fine Arts and there’s 400,000 in dress. That’s not Joe Biden. Studies let all these people run over the White House.
00:47:43 Speaker 5
It is too late now because I think what’s gonna happen is the well, the Republicans are gonna win.
00:47:45 Speaker 3
Is it too late now?
00:47:48 Speaker 5
The house, at least.
00:47:48 Speaker 3
How much time, how much time do we spend talking about canceling student debt for who?
00:47:53 Speaker 2
Yeah, no.
00:47:54 Speaker 2
For a bunch of elite people, get for accurate degrees from.
00:47:55 Speaker 3
Uh, we went through history.
00:47:58 Speaker 3
Yeah, sure.
00:47:59 Speaker 2
It’s only in this in the scriptures on both sides.
00:48:01 Speaker 2
It’s disgusting.
00:48:02 Speaker 2
And we need to get to a version of politics that maybe it’s more like our conversations here, but let’s let’s pivot to another society that we thought was going to roll over ours but and that we were in, we were behind on in terms of competition.
00:48:15 Speaker 2
China is in chaos right now, apparently.
00:48:18 Speaker 2
In terms of slowing economic growth, bank protests, mortgage protests, exactly what I predicted last year when you guys were talking about China was going to junk on us.
00:48:27 Speaker 2
And I said, you know, it’s very hard to run these authoritarian countries and the citizens like to protest when they get the short end of the stick.
00:48:35 Speaker 2
And here we go.
00:48:36 Speaker 2
Chinese economy is is growing very slowly.
00:48:38 Speaker 2
They’re going to do 5.
00:48:39 Speaker 2
And 1/2 percent this year, there were only .4% in Q2. Kobad has a lot to do with this, but there’s been a series of bank protests, and the media has been trying to figure out exactly what’s going on here.
00:48:50 Speaker 2
To set the stage here, royal banks in China in a couple of provinces froze a bunch of people’s withdrawals in April.
00:48:58 Speaker 2
OK, sounds like the crypto contagion in many ways.
00:49:02 Speaker 2
They had been offering unusually high interest rates, also counting like the GFI group going on here.
00:49:07 Speaker 5
No, I think it’s, I think it’s more like 2008 race and I think the answer is I think it’s more like the financial crisis in 2008 that was driven by the real estate bubble. Yes, they’ve got their own real estate bubble, which is collapsing there.
00:49:17 Speaker 2
And so there’s there’s multiple things going on at once.
00:49:21 Speaker 2
The authorities haven’t said how much money is frozen protesters.
00:49:24 Speaker 2
Claim it’s buildings.
00:49:25 Speaker 2
Of one, but it’s hundreds of 1,000,000 in the.
00:49:29 Speaker 2
After weeks without a resolution, customers have been began protesting.
00:49:33 Speaker 2
Plain clothes thugs have been hitting and kicking the protesters and as of Wednesday, a video and viral of the TCP bringing in tanks to protect the banks.
00:49:43 Speaker 2
Very evocative of Tiananmen Square comma, not the question.
00:49:47 Speaker 2
So, but Yep, so China has a very explicit 0 tolerance policy on COVID.
00:49:53 Speaker 2
Why do you guys?
00:49:55 Speaker 2
They are so extreme in that policy like.
00:49:59 Speaker 2
Any ideas?
00:50:01 Speaker 2
Like have they explained why it has to be 0 tolerance?
00:50:05 Speaker 2
They have not explained that.
00:50:06 Speaker 2
And if you believe that there are the origin of COVID, maybe they have some insider information about long haul COVID and that was something I want to talk to Friedberg about.
00:50:15 Speaker 2
Or he thinks this you know?
00:50:18 Speaker 2
Long term COVID stuff is a really acute issue, but free bird would either.
00:50:22 Speaker 2
I don’t.
00:50:25 Speaker 2
I don’t know.
00:50:25 Speaker 5
Not trying answers tonight.
00:50:27 Speaker 5
After that, digital watches listen.
00:50:28 Speaker 2
Yeah, go ahead.
00:50:29 Speaker 5
I think the answer is very simple, which is.
00:50:30 Speaker 2
But I just want to talk about the.
00:50:32 Speaker 2
Chinese economy I.
00:50:33 Speaker 5
Oh yeah, yeah.
00:50:33 Speaker 2
Yeah, we got we got two more cars to turn over to, yeah.
00:50:34 Speaker 5
So there’s, there’s, there’s a lot going on there.
00:50:36 Speaker 2
This is complex issue.
00:50:37 Speaker 5
There’s a lot more going on there.
00:50:38 Speaker 5
So on 0 COVID, I think this is coming directly from she.
00:50:41 Speaker 5
This is his policy, and I think that earlier in the pandemic.
00:50:46 Speaker 5
They were hailing their response, which they saw as orderly and effective at controlling COVID, and they were contrasting that with a chaotic Western response.
00:50:56 Speaker 5
And so I think that the credibility of the CC P&G himself got tide up in this idea of stopping COVID entirely.
00:51:06 Speaker 5
0 COVID and so I think this is coming directly from.
00:51:08 Speaker 5
The top and.
00:51:09 Speaker 5
It’s having a huge impact.
00:51:11 Speaker 5
On their economy.
00:51:12 Speaker 5
And I think this is one of the dangerous aspects of an autocratic system is you’ve got one guy at the top making the decisions and if he’s wrong.
00:51:20 Speaker 1
There’s not really a great.
00:51:21 Speaker 5
Feedback for flighting it?
00:51:21 Speaker 2
And nobody can question.
00:51:23 Speaker 2
Him, yeah.
00:51:23 Speaker 2
There’s no questioning that God can.
00:51:23 Speaker 5
Yeah, exactly so.
00:51:26 Speaker 5
Either it’s sort of recalls a situation in China. I think it’s about 500 years ago there was a Chinese emperor who banned shipbuilding and banning having a Navy and because of that trying to shut himself off from global trade. And it fell well behind the West, which then explored and captures the new world. There’s this question.
00:51:45 Speaker 5
Yeah, the Chinese, Chinese cultural civilization was much more advanced.
00:51:49 Speaker 5
Than the West, than Europe 1000 years ago, but basically it fell behind. And a big reason is because this unilateral decision by 1 emperor to basically close ourselves off from the rest of the.
00:52:00 Speaker 5
World so you have to wonder, does this auto price move by G basically June their economy to a recession?
00:52:07 Speaker 5
It seems like they’re not learning from our experience, these blocks.
00:52:10 Speaker 5
Constant work.
00:52:10 Speaker 5
I mean, you can’t stop the virus.
00:52:12 Speaker 5
It’s eventually going to get out.
00:52:14 Speaker 5
Even I saw Biden.
00:52:15 Speaker 5
Not the virus this week.
00:52:17 Speaker 5
I mean, it’s out right now.
00:52:18 Speaker 2
Yeah, of course.
00:52:19 Speaker 2
Yeah, everybody should get it.
00:52:20 Speaker 2
Is it basically with some use?
00:52:21 Speaker 5
He’s been making a bunch of heavy-handed decisions like this, yet besides lockdowns, it was it’s also the crackdowns. It’s a crackdown on the tech industry and tack.
00:52:29 Speaker 2
Yeah, the venture funding has plummeted and so has. So LP’s are no longer investing in funds there, with the exception of Sequoia, which seems to be struggling but is still able to raise the money and then additionally.
00:52:30 Speaker 1
On for north.
00:52:44 Speaker 2
Founders can’t raise money, and founders are questioning when they meet with DC’s if they can actually, if the VC’s are just meeting with them. Diatric Lee, the story that came out this week in the.
00:52:52 Speaker 2
See if they’re just meeting with me at rickley because they want to still hold out hope that they’ll be a venture capital industry, but there may not be a VC industry in China anymore.
00:53:02 Speaker 2
Let me just give you the housing stuff.
00:53:03 Speaker 2
And then freeberg, I know you want to.
00:53:05 Speaker 2
Chime in on this.
00:53:06 Speaker 2
So there’s also mortgage boycotts happening at the same time as this fugazi bank stuff happened.
00:53:12 Speaker 2
The bank stuff.
00:53:13 Speaker 2
Seems to be not the National Bank CS or local banks that apparently could have been running some kind of grift where people deposited the money.
00:53:19 Speaker 4
Well, it looks.
00:53:19 Speaker 2
And then ran.
00:53:20 Speaker 2
It looks a lot like the things in.
00:53:21 Speaker 2
So you have behavior in the 90s in in the US?
00:53:24 Speaker 3
So at least.
00:53:25 Speaker 2
For regional banks to be clear, this isn’t the national banks. And so at the same time, the mortgage boycotts are happening in three at 301 unfinished developments in 91 cities, homeowner association developers selling to deliver the apartments they’ve already paid for.
00:53:37 Speaker 2
According to Bloomberg, 70% of household wealth in China tide up in property much higher than EU.
00:53:42 Speaker 2
S This is downstream.
00:53:42 Speaker 5
Of the whole Evergrande thing, right, he’s not.
00:53:44 Speaker 2
Dave argument.
00:53:44 Speaker 5
Evergrande, Evergrande basically defaulted and there are a whole bunch of people who prepaid for their homes and so they’re already paying mortgage that Evergrande never finished their homes and now they’re rising after saying why should we pay for a home that was never delivered?
00:53:55 Speaker 4
Right, right, right I.
00:53:57 Speaker 2
Just want to like take a.
00:53:58 Speaker 2
Zoom out because I think it’s worth.
00:54:01 Speaker 2
You know, we can focus on any.
00:54:02 Speaker 2
One of these particular.
00:54:04 Speaker 2
Things that are happening and try and diagnose them and dissect them.
00:54:07 Speaker 2
But if you zoom out a little bit, I think it paints a more interesting picture. Over the last 30 years, right, the Chinese economy grew from 318 billion.
00:54:16 Speaker 2
Here in 1990 to 10 1/2 trillion in 2020, right. Incredible growth, GDP per capita.
00:54:24 Speaker 2
You know, grew.
00:54:26 Speaker 2
I kind of in a similar race here right now from 318 bucks per person to $12,500 and 30 years.
00:54:34 Speaker 2
I mean really unprecedented iteration entity. China now accounts for 20% of global GDP from less than two percent 1990.
00:54:40 Speaker 2
Now if you look at historically what drove that growth, we all talked about manufacturing, right? Manufacturing steps for about 1/3 of the economy.
00:54:47 Speaker 2
And manufacturing as a sector was growing in China 25% year over year in 2008 and then only grew 6% in 2020 series and like basically you know kind of reaching an all time low in in recent years.
00:55:01 Speaker 2
So that’s historically been the driver for growth of this economy and so much of the, you know the, the the bargain.
00:55:07 Speaker 2
Between the people and the Chinese Communist Party has been.
00:55:10 Speaker 2
Keep giving us a better life.
00:55:12 Speaker 2
Keep growing.
00:55:12 Speaker 2
Our economy keeps giving us more housing, more stuff, more food, more tasty, more securities.
00:55:17 Speaker 2
We’ll support TCP and the challenge that the CCP is having is that a lot of that grows. The core growth engines is starting to slow, the manufacturing is slowing, then real estate was growing and so real estate accounts for 7%.
00:55:30 Speaker 2
Of the Chinese economy, and I’ve got a good start for you guys here in 2000 and five 250,000,000 square meters of real estate was sold in China.
00:55:40 Speaker 2
In 2020, one 1.5 billion was sold every year it’s been incremented. So the amount of real estate that’s being produced and sold with increasing like crazy this year.
00:55:49 Speaker 2
Wow. So it’s all, it’s sound like, you know, forecast to be about 1.2.
00:55:53 Speaker 2
5 billion now.
00:55:54 Speaker 2
So the 1st.
00:55:54 Speaker 2
Decline in real estate building in sales so that’s part of the driver of the of the economy in China is paraquat sing.
00:56:01 Speaker 2
And then the financial services sector accounts for 8% of the economy and that’s been growing because it’s leveraged alternating factoring in real estate and all the.
00:56:08 Speaker 2
Capital has flown in.
00:56:09 Speaker 2
All of which is slowing down and stopping. You know, there’s $58 trillion of assets in China generating about $700 billion of annual profits for the financial service industry, insurance, banking, lending and so.
00:56:21 Speaker 2
So a lot of its concepts and the things that are starting.
00:56:23 Speaker 3
To fall apart.
00:56:25 Speaker 2
Which may just be the tip of the iceberg, is a function of a fundamentally slowing economy and the forecast in the outlook for an economy that doesn’t have the drivers attached historically.
00:56:35 Speaker 2
And things are starting to come off, the wheels are starting to come off a bit and so, you know, look the advantage they have.
00:56:40 Speaker 2
It’s central planning, long term investments, being able to kind of be thoughtful about this, but in order to do that there’s certainly going to be a need for the TP to keep people in line as some of the long term bets hopefully play out for them.
00:56:53 Speaker 2
As they would say in order to do that, they’re going to have lockdowns and other sorts of mechanisms of regulatory control over the people.
00:57:00 Speaker 2
But really this could be the beginning of some of the unwinding and real concerns about, you know, is there a core economic growth engine in China that can save them?
00:57:09 Speaker 2
And what we’re at these, I think all of this, if we look at what’s happening in the economy at large chamah, you know, the global slowdown plus inflation is now causing a self test on every country.
00:57:20 Speaker 2
Shree Lanka stress test you know, showed us what’s happening with their farming issues and with corruption and here in China it distressed tests.
00:57:28 Speaker 2
I think you would agree in showing what’s going on in terms of.
00:57:32 Speaker 2
You know, banking, mortgages, real estate and obviously this surging middle class and what their expectations of life are.
00:57:40 Speaker 2
So what’s your take on what’s happening in China and are they, you know, how does this add up in terms of our rivalry with them as our contemporaries?
00:57:52 Speaker 2
At a very natural level, China has.
00:57:55 Speaker 2
One massive, massive, massive problem, which is one of population.
00:58:01 Speaker 2
It’s hard to get an accurate count, but it is an aggressively aging population which was the result of the one the one child policy.
00:58:11 Speaker 2
For a very long time China has sort of been on their heels trying to adapt that policy, but really the last data I saw, I printed this out.
00:58:21 Speaker 2
Is this a little while ago? Next? It may be hard for you to find in my Twitter feed, but it was the projection of China’s population which essentially showed a contracting by almost 50%.
00:58:29 Speaker 2
By 21.
00:58:30 Speaker 2
100 so and so is.
00:58:33 Speaker 2
That’s a really, really bad situation now when you have a floating population.
00:58:38 Speaker 2
Then the economy has to morph.
00:58:41 Speaker 2
Why is that when you have a young population?
00:58:43 Speaker 2
So for example, take what China was 20 years ago when it entered the WTO, or what our India is today.
00:58:50 Speaker 2
When you have lost some thoughts of young people, you could unwrap them into economically productive activities like manufact.
00:58:58 Speaker 2
The problem in those folks accumulate middle class income and wealth.
00:59:02 Speaker 2
Is a stone.
00:59:03 Speaker 2
Age out of both kinds of jobs like they did in America.
00:59:06 Speaker 2
And what we?
00:59:07 Speaker 2
Seek our services and service level jobs.
00:59:11 Speaker 2
And you spend more money, you spend it in their different ways.
00:59:14 Speaker 2
So as populations age, your economy has to turn over.
00:59:18 Speaker 2
Unless you have a large bulwark of young people that is constantly growing to take up more of the flashy economic class to pay for these folks who have different lifestyles, more fadings, and different needs, specifically health care.
00:59:34 Speaker 2
That’s China scheme normalcy, big problem. So when you see that it’s talking about 6% GDP targets and you think how does a country that bid even grow at 6%, it’s because their reverse engineering for what they need to create economic vibrancy in that country.
00:59:52 Speaker 2
And so when you first look.
00:59:53 Speaker 3
At 2% which in America you.
00:59:54 Speaker 2
Saved for since grace.
00:59:56 Speaker 3
We were like high fiving.
00:59:57 Speaker 2
Each other for 2%.
00:59:59 Speaker 2
That’s not a sustainable level of growth for what’s happening inside that country.
01:00:03 Speaker 2
It does not create enough of expansion economically to cover all diesels.
01:00:08 Speaker 2
That is a really, really big issue.
01:00:11 Speaker 2
So as that happens, I think what we need to do is figure out how to be competitive, not discuss all the results for first conversation.
01:00:19 Speaker 2
Sub cities don’t make us more competitive.
01:00:23 Speaker 2
Seeing that governments can do to make us more competitive or long term drawn out tax instances that change the earnings capacity of.
01:00:35 Speaker 2
Because in the capital markets reward those businesses.
01:00:38 Speaker 2
Jason, you just mentioned is why is the Chinese capital markets in difficulty?
01:00:44 Speaker 2
Nobody knows what the long term earnings are.
01:00:46 Speaker 2
How do you forecast it?
01:00:48 Speaker 2
It’s not simple anymore.
01:00:49 Speaker 2
It’s not a model, it’s not an interest rate.
01:00:51 Speaker 2
It’s not a discounted set of capsules.
01:00:53 Speaker 2
Right.
01:00:55 Speaker 2
And so that’s how they need to restructure themselves.
01:00:58 Speaker 2
They need to have a much larger population.
01:01:01 Speaker 2
If you don’t have that, you have to figure out how to do.
01:01:03 Speaker 2
It with immigration.
01:01:04 Speaker 2
If you don’t.
01:01:04 Speaker 2
Have that what China has done is they’ve tried to go to Southeast Asia, to Africa and they try to.
01:01:11 Speaker 2
Create that synthetic.
01:01:13 Speaker 2
Form of a growing pyramid.
01:01:15 Speaker 3
Right.
01:01:17 Speaker 2
Now back in work, as long as the balance sheet of the country supports that because ultimately you’re still talking about moving money offshore, OK.
01:01:25 Speaker 2
So I think there is a little bit of it.
01:01:27 Speaker 2
They’re doing a pretty difficult spot.
01:01:29 Speaker 2
The most difficult spot is when they that she puts them in, if you get rid of entrepreneurship, if you get rid of high growth companies that create the opportunity.
01:01:37 Speaker 2
On a global scale and then you, you know, take DD off the public markets.
01:01:42 Speaker 2
You don’t let education companies become public or you basically get rid of their little Co authoring of capitalism and venture capital.
01:01:50 Speaker 2
Their whole, their whole society is going to become slow growth and slow growth in a country.
01:01:55 Speaker 2
That doesn’t have safety net is really dangerous facts with us in terms of competition versus America.
01:02:01 Speaker 5
Yeah, OK when I.
01:02:01 Speaker 5
Get to the competition in a second. Just building which master the the birth rate there were the fertility rate in China flipped to just 1.15 in 2021.
01:02:11 Speaker 5
So last year it takes 2.1 just to maintain your population or replacement level. So and this is lower than even Japan which is also shrinking because.
01:02:20 Speaker 5
Japan is about 1.3 the US, Australia or 1.6, but we get above 2.1 because of immigration and China doesn’t have that. So they’ve got a huge demographic prompt moth point. It’s going to be something like.
01:02:33 Speaker 5
Well, the population is shrinking by 40% with every generation. That’s what these numbers are inclined. The numbers are it’s going to be under 600 million by the year 2100.
01:02:37 Speaker 2
Two things.
01:02:41 Speaker 5
But I would.
01:02:42 Speaker 5
I don’t understand.
01:02:43 Speaker 5
How it wouldn’t even be less than that if it keeps going.
01:02:46 Speaker 5
At this rate.
01:02:47 Speaker 5
So there in the the commentator Peter Jihan has or I don’t know if that’s right with that center design.
01:02:54 Speaker 5
Or something, anyway.
01:02:55 Speaker 5
He’s pointed out that China is facing demographic collapse in the next decade or so.
01:03:01 Speaker 5
On top of that, like you’re saying Jason, you’ve got G emphasizing malas economics.
01:03:07 Speaker 5
He basically says he thinks that the Chinese economy again, he stresses the need.
01:03:12 Speaker 5
Socialist characteristics and he’s going to bring back.
01:03:16 Speaker 5
That sort of communist.
01:03:17 Speaker 5
Ideology to their economy and they basically.
01:03:21 Speaker 5
Crack down on entrepreneurship and venture capital is really a cell phone.
01:03:25 Speaker 5
I mean, they’ve moved away from the policies that have made them so successful economically over the last 40 years.
01:03:30 Speaker 5
And then on top of that, you got this Jack crisis, this housing crisis.
01:03:33 Speaker 5
So it really looks like the deck is stacked against all of them.
01:03:36 Speaker 5
And you’re asking, what does this mean for us?
01:03:38 Speaker 5
Well, I think it depends on whether you look at it economically or geopolitically.
01:03:42 Speaker 5
I think if you look at it economically, you’d say that it’s bad for us because our two economies are economically linked.
01:03:49 Speaker 5
There’s a lot.
01:03:50 Speaker 5
Of dependency they’ve evolved together for a.
01:03:52 Speaker 5
Long period of.
01:03:53 Speaker 5
Time and if China has a collapse, then that they’re so big.
01:03:58 Speaker 5
Now that that’s going to have, I think, global repercussions, they’re gonna be contagious.
01:04:03 Speaker 5
But the truth is, if you look at it geopolitically, and geopolitics is more of a the balance of powers of 0, sum gain.
01:04:10 Speaker 5
Economics can be a positive sum game.
01:04:11 Speaker 5
But but the balance?
01:04:12 Speaker 5
Of power is definitely positive, something you’d have to say it’s good for us because the reason why China has become.
01:04:18 Speaker 5
Such a threat is.
01:04:20 Speaker 5
Because of its growing economy over the last 40 years.
01:04:23 Speaker 5
And look, I mean, what they’ve done and what they’ve been doing over the last decade or so is translating their economic might into military might.
01:04:31 Speaker 5
And that has given them the capability to now threaten their neighbors to become more below.
01:04:37 Speaker 5
Current to basically row the Saber against Taiwan and if their growth, that is, their impressive economic growth, continues for the next couple of decades, it has until now.
01:04:48 Speaker 5
There is no question that they will.
01:04:50 Speaker 5
They will basically try to assert their hegemony over East Asia and Taiwan will be a huge flash.
01:04:57 Speaker 5
Point but there’s also flashpoints in the East China Sea, with Japan over the Chicago island.
01:05:02 Speaker 2
But they’re going to need a bankroll to do that.
01:05:03 Speaker 2
So if they don’t, if their economy is not growing, they don’t have the bankroll to do it, they’re going to have to look inward and say, hey, we gotta fix these domestic problems, we gotta get people stop protesting these streets.
01:05:04 Speaker 4
Right.
01:05:12 Speaker 2
We need to.
01:05:13 Speaker 2
This middle class is demanding of jobs.
01:05:15 Speaker 2
The great news for what’s happened in China, and I think This is why the people there are very happy, is the number of people living in poverty has plummeted.
01:05:24 Speaker 2
You know, when they started tracking this data in the 80s, you know, high 90% of people were living in extreme poverty or poverty, 99% of people were in poverty on the on the global definition of it. And now.
01:05:35 Speaker 2
You know it’s just plummeted to you know couple of 100 million people.
01:05:39 Speaker 2
So a couple of charts here, but just and the data is obviously it’s very hard to understand what’s going in China because a lot of it is opaque.
01:05:47 Speaker 2
Just the number of people on a percentage basis living in poverty has gone, and now the number of people who are in the middle class has surged.
01:05:53 Speaker 2
That creates another dynamic.
01:05:54 Speaker 2
Those people want to have a great life, they want better jobs, they don’t want to work in factories.
01:05:58 Speaker 2
They want to have a a more information based economy in a better job than.
01:06:02 Speaker 2
60 hours a week in a in a factory.
01:06:05 Speaker 2
That’s why they’re moving their factories.
01:06:06 Speaker 2
Africa and other places.
01:06:07 Speaker 2
Seeing I, I don’t know if that’s absolutely true. I I think that China’s name factoring sector is.
01:06:12 Speaker 2
It is aiming to evolve, so you know China has about 3,000,000 factories or manufacturing facilities throughout the country.
01:06:22 Speaker 2
Employing about 112 million people, the US has about 300,000 factories in Poland, employing about 12 and a half million people.
01:06:30 Speaker 2
The output of our factories is about 70% of the output of of climate factories in in aggregate.
01:06:41 Speaker 2
Sorry, the total production output of all the factories.
01:06:44 Speaker 2
So we have very high value outputs coming out of our factories.
01:06:48 Speaker 2
And high leverage?
01:06:50 Speaker 2
China is observing and obviously recognizes that there’s an opportunity probably to evolve their manufacturing capacity to be higher leverage, higher value output.
01:07:01 Speaker 2
And so there is going to be you know from the long range perspective planning and investment in technology that allows those factories to become much more.
01:07:10 Speaker 2
Sophisticated and create much more higher value products, moving up from what is effectively just cheap labor or putting things together in an assembly plant.
01:07:18 Speaker 2
So being things like additive manufacturing, 3D printing, automated manufacturing, bio manufacturing, et cetera. And I think this is particularly going to be realized because China announced that they’re building 400 nuclear power plants that drops the cost of electricity to under $0.05 a kWh.
01:07:38 Speaker 2
In the US, manufacturing electricity typically costs around $0.11 per kWh $0.12 per kilowatt.
01:07:44 Speaker 2
Hour in that range.
01:07:46 Speaker 2
So if factories become much more automated, they start to become a function of the price of electricity in terms of what they can output.
01:07:52 Speaker 2
China is going to have a huge advantage.
01:07:54 Speaker 2
As these nuclear power plants.
01:07:55 Speaker 2
Come online over the next couple of decades.
01:07:58 Speaker 2
And these facilities get upgraded.
01:07:59 Speaker 2
So there is a player, right.
01:08:01 Speaker 2
Remember this issue report?
01:08:03 Speaker 2
And and there’s there’s a question of Judah get there fast.
01:08:08 Speaker 2
Enough to drive economic growth that actually supports all these other industries like real estate and finance.
01:08:13 Speaker 2
They become critically dependent on because those industries only work if there’s a core economic driver or core economic engine that’s working here.
01:08:20 Speaker 2
So this energy infrastructure is a key manufacturing infrastructure.
01:08:24 Speaker 2
These are things that by the way they can do really effectively.
01:08:28 Speaker 2
Because they’re not working on 4 year old six year political cycles, they can take a 510 and 30 year outlook and make a make a plan and invest against it looking.
01:08:37 Speaker 2
There’s some nice little wouldn’t count him out, but there’s certainly a lot of challenges they’re facing right now.
01:08:41 Speaker 2
It’s a big question mark right now.
01:08:43 Speaker 2
Going to happen well and it to you.
01:08:45 Speaker 2
The point factories in China are, you know, factory workers getting paid over 6 bucks an hour now in Vietnam?
01:08:52 Speaker 2
In India, even less.
01:08:53 Speaker 2
And that’s why you’re seeing a lot of folks.
01:08:55 Speaker 2
I don’t know if you’re seeing in your portfolios, but we’ve seen a lot of folks looking at India, Vietnam and moving factories there.
01:09:02 Speaker 2
And obviously Japan has been incentivizing truthful.
01:09:05 Speaker 2
Going to just lose their manufacturing edge.
01:09:07 Speaker 2
They’re not just going to say, hey, we developed like whatever game, we’re going to try and upgrade the capability of the factories and say, hey, instead of just.
01:09:13 Speaker 2
Putting together, you know, parts with $6 an hour of human labor, let’s start to do the more sophisticated stuff that we offer.
01:09:19 Speaker 2
Next part that turns is, well, what happens to those factory workers if they’ve been automated out?
01:09:24 Speaker 2
What do you do with hundreds of millions of people working in factories who now have been turned into robots?
01:09:29 Speaker 2
And then if they’re going to be in the answers information economy, the information economy, you need venture capital and you need new companies to create those jobs.
01:09:37 Speaker 2
And they just killed that.
01:09:38 Speaker 2
So I don’t know what.
01:09:40 Speaker 2
Strategy she is pursuing here, but it seems like a bad one.
01:09:43 Speaker 2
We could talk about this one I’d.
01:09:44 Speaker 2
Like, but we.
01:09:46 Speaker 2
Were going to bring this up, but you know, generally speaking, technology drives productivity gains, but it’s it’s different than Earth.
01:09:53 Speaker 2
Explain what that means on it in like a practical sense.
01:09:56 Speaker 2
Maybe you know that the technology.
01:09:59 Speaker 2
So let’s say let’s say that you have to pay a bunch of people to make a T-shirt, and then a machine is built that makes the T-shirt.
01:10:05 Speaker 2
The cost of the T-shirt goes down because one machine can just print out 100 T-shirts. In our words, it would take five people, you know, 10 hours to make those better T-shirts or whatever it is.
01:10:14 Speaker 2
So as technology of kind of emerges and those people are now theoretically out of jobs, but what ends up happening is those people transition into new jobs that didn’t exist before and we end up seeing higher order work.
01:10:28 Speaker 2
Quite. Think about the the world 200 years ago. Do you think we?
01:10:32 Speaker 2
Would have had any.
01:10:33 Speaker 2
Concept of people being Uber drivers or people.
01:10:36 Speaker 2
You know, creating crafts and selling them on St or people being bought and teachers or yoga or yoga teacher for psychoth erapists.
01:10:40 Speaker 3
Future is concentrated Rd actors.
01:10:46 Speaker 3
Only friends only.
01:10:48 Speaker 2
Oh, OK, well they go to or only fans for dog walkers or all of these these service businesses.
01:10:48 Speaker 3
Hold on.
01:10:55 Speaker 2
Or, you know, industries that simply did not exist before.
01:10:58 Speaker 2
And so the labor that those that that percentage of the population was involved in historically has gone away because it’s been automated.
01:11:06 Speaker 2
As that automation has happened, it’s allowed higher order services jobs to emerge and that will be the progression of humanity forever, I will tell you guys.
01:11:15 Speaker 1
I was going to mention.
01:11:16 Speaker 2
This have you guys played with Dolly?
01:11:18 Speaker 2
Yes, yes Sir. I got the login. I was my brother-in-law was visiting. We were playing with Dolly Theater and making.
01:11:25 Speaker 2
Explain what it is.
01:11:26 Speaker 2
So so Dolly two is developed by opening I.
01:11:29 Speaker 2
We all know Sam Altman.
01:11:31 Speaker 2
He’s been leading that organization to great effect over the last couple of years.
01:11:34 Speaker 2
And and what they’re doing is they they basically scan the web for images, tag them.
01:11:39 Speaker 2
And then applied, you know, machine learning to, you know, to basically allow natural language creation.
01:11:48 Speaker 2
Of images from scratch.
01:11:49 Speaker 2
So the AI can generate an image and you can go to you know, the Internet and look at a bunch of these, but the imagery is incredible.
01:11:56 Speaker 2
I mean, that’s the creative output.
01:11:58 Speaker 2
What feels that creative output from this system where you just say, hey, you know, make me an image of four guys doing a podcast on zoom in the style of Van Gogh.
01:12:08 Speaker 2
And it creates.
01:12:09 Speaker 2
This image that it’s unique has never been created or seen on Earth before and is a function of the learning that’s been done in these neural networks.
01:12:16 Speaker 2
To develop its AI that can that can create not novel stuff is really amazing and I started to think about like what are the implications for this over time?
01:12:26 Speaker 2
But you know, the original movies then her in today’s dollars, would have cost a billion dollars to make.
01:12:31 Speaker 2
They had thousands of people, 10s of thousands of people on that status in years to make digital giant sets they can only steal.
01:12:37 Speaker 2
Make one film.
01:12:39 Speaker 2
It was an incredible feat in an effort.
01:12:41 Speaker 2
That’s what movie making is, you know, still today there’s there’s teams of people.
01:12:46 Speaker 2
Now what if you could speak to the AI and say make photo realistic.
01:12:49 Speaker 2
You know, Jason and Thomas having a battle on a field in the middle of nowhere, and now our airplane flies over and you can instruct the AI and the AI can generate photorealistic vision.
01:13:00 Speaker 2
Rules audio, the area I can even generate scripts and merit for you.
01:13:04 Speaker 2
It really starts to change the role of the Creator, the director.
01:13:08 Speaker 2
The director is no longer doing this thing.
01:13:10 Speaker 2
We have to get it shipped right, make the perfect 90 minutes and then line up all the money and all the people to do that, work on that, plan, on that program.
01:13:16 Speaker 2
They can be much more iterative, and they.
01:13:18 Speaker 2
Can be much more creative on the slide that goes through our.
01:13:20 Speaker 2
Movie by speaking to the AI and then edit the movie by speaking to the AR.
01:13:23 Speaker 4
Right.
01:13:24 Speaker 2
Change with actors, change the color, change, the horse says.
01:13:27 Speaker 2
Change the music.
01:13:28 Speaker 2
Just speaking to AI to generate creative output and people will consume.
01:13:32 Speaker 2
That output, and I think it’s amazing to think about what creators will end up doing 10 years from now as AI and these tools proliferate.
01:13:39 Speaker 2
And you see version 12 of this, which is version two and version 12 might enable.
01:13:44 Speaker 2
And so the role, the number of people that can do that job goes from Steven Spielberg and Bob Magness and a few other people to suddenly thousands or 10s of thousands of people.
01:13:54 Speaker 2
Around the world, making incredible movies. This is like, here’s Dolly’s image.
01:13:57 Speaker 2
Was pulled up of four guys doing the pot.
01:14:00 Speaker 2
Yeah, so I we have a ways to go, but yeah, that is four guys doing the podcast.
01:14:05 Speaker 2
Yeah, so I mean to your point, like, you know, this is gonna we’re.
01:14:08 Speaker 2
Oh yeah, this is this is going up.
01:14:09 Speaker 2
So a lot of people like, oh, is this going to wipe?
01:14:11 Speaker 2
Out graphic designers.
01:14:12 Speaker 2
Is going to wipe out the creative industry, but the reality is the roles that those people are in today will absolutely be gone.
01:14:18 Speaker 2
But they will.
01:14:19 Speaker 2
Emerge and evolve into new roles that we never even thought imaginable, that will really transform that industry and society.
01:14:22 Speaker 4
Bill has jumped.
01:14:25 Speaker 2
And this is going to be true across everywhere that AI touch it.
01:14:27 Speaker 2
Yeah, and I’m in China.
01:14:30 Speaker 2
As China steps up, their technology in manufacturing will see those, you know, new markets involved right from our side.
01:14:35 Speaker 3
Designers will have less leverage to add.
01:14:37 Speaker 2
For all these stupid snacks and offices of startups.
01:14:41 Speaker 3
Well, I mean.
01:14:42 Speaker 2
You need only look at that telephone, sure.
01:14:47 Speaker 2
In in the 1940s, I mean, there were literally hundreds of thousands of telephone operators equal and and and they’re all gone now. And not only that.
01:14:53 Speaker 3
Holy. Holy.
01:14:57 Speaker 2
Have you ever met a designer that didn’t take themselves incredibly seriously, but didn’t have like, you know, teams that they would speak their loosely, thinking that?
01:15:05 Speaker 2
They would change.
01:15:07 Speaker 2
They’d have like field shrouds.
01:15:09 Speaker 2
Video game designer little bit.
01:15:10 Speaker 2
I’m sorry.
01:15:10 Speaker 2
What did you say about the sales for us?
01:15:15 Speaker 2
Well, I’m eliminative wasting my life, I.
01:15:19 Speaker 2
Mentioned to you guys.
01:15:20 Speaker 2
Last year this video game I played over Christmas by Annapurna Pictures and the guy that runs the studio sent me a DM he.
01:15:28 Speaker 2
Loves the pod.
01:15:30 Speaker 2
And they just launched a new video game, which I started playing a couple nights ago called.
01:15:35 Speaker 2
Right.
01:15:35 Speaker 2
And you literally asked you, you play the game as a calf lost in some crazy world.
01:15:40 Speaker 2
You’re literally attacked.
01:15:42 Speaker 2
The just the industry on this thing is unbelievable.
01:15:42 Speaker 1
That’s awesome.
01:15:45 Speaker 2
Answer some of my.
01:15:46 Speaker 3
Yeah, yeah.
01:15:46 Speaker 2
Favorite game right now faxes I play a cat publish like at the store the basically the the I you know it’s exciting part is really hard.
01:15:56 Speaker 2
Yeah, I’m going to take a hard pass from.
01:15:58 Speaker 1
I could play a game.
01:15:59 Speaker 2
Where I’m afraid, dog.
01:16:00 Speaker 2
And I need another dog, and then we’re moving to pasta.
01:16:03 Speaker 2
But this long sugar pasta needs come closer and closer every induction.
01:16:08 Speaker 2
Let’s move onto we want to go.
01:16:11 Speaker 2
Black Rock has lost.
01:16:13 Speaker 2
$1.7 trillion in six months, VC funding is down, or Amazon acquires one medical for 3.9 billion.
01:16:24 Speaker 2
Which, which one do we want to go to next?
01:16:26 Speaker 2
Anybody have a favor here at Saks?
01:16:27 Speaker 2
You’ve been a little quiet, you got one you want to go to?
01:16:29 Speaker 5
We can sort of like crossing.
01:16:31 Speaker 2
This is the largest amount of money lost by a single firm over six months period in history. BlackRock is the world’s largest asset manager.
01:16:38 Speaker 2
And it was the first firm to break $10 trillion in a run assets under management. Not right now.
01:16:45 Speaker 2
There are 8.4 trillion 2022 ranks as the worst star in 50 years for both stocks and bonds, Chairman and Chief Executive Officer Larry Fink said on his earnings call at the end of June. Only about 1/4 of its assets were actively managed to beat a benchmark.
01:16:58 Speaker 2
Rather than track it seamlessly as passive strategies are designed to do, firms taxes equity holdings are now 10 times larger than its active holdings, although it does operate some active multi asset and alternative strategies that may or the gap.
01:17:11 Speaker 2
Clots and bond markets this year has shaken money out of active.
01:17:15 Speaker 2
Fixed income firms.
01:17:16 Speaker 5
Listen, I think.
01:17:17 Speaker 5
There’s less than meets the eye here.
01:17:18 Speaker 5
Which is I think this was a.
01:17:19 Speaker 5
Headline that was trying.
01:17:21 Speaker 5
To grab attention by saying biggest loss ever.
01:17:23 Speaker 5
Look, the reason why it was the biggest loss ever is because Black Rock is so big.
01:17:28 Speaker 5
I mean and and one is black, I’m basically at this point they’re index funds, their ETF or index funds they just represent market in.
01:17:35 Speaker 5
See, so you know the reason why it went down 1.7 trillion is ’cause it started with 10 trillion.
01:17:41 Speaker 5
Yeah, the average index is down 17%. That’s all it means. We know this, yes, and P5 understand.
01:17:47 Speaker 5
20%, twenty, 2% for the year. The Dow Jones down 15 ish. The NASDAQ is down like 30. So this is just reflecting what we already know.
01:17:55 Speaker 5
Which is that the stock market is down.
01:17:57 Speaker 2
This year, do you think it’s another data point to support the idea that active managers, generally speaking or maybe holistically speaking over time, cannot be the you know, the market cannot beat indices and you have a point of view on that as an investor set?
01:18:15 Speaker 5
Well, I think you know you’re talking about public market investors.
01:18:18 Speaker 5
It I think it’s very hard to beat.
01:18:18 Speaker 2
Yeah, only part about Steph.
01:18:19 Speaker 5
It is very hard to beat the public markets.
01:18:24 Speaker 5
Over a long period of time, consistently.
01:18:27 Speaker 5
I just think.
01:18:27 Speaker 5
It is now.
01:18:28 Speaker 5
You know the contradiction though is that if you have.
01:18:30 Speaker 5
No active managers.
01:18:34 Speaker 5
Then the indices won’t be efficient anymore, so you need the participation of the active managers to help drive the indices and make corrections to it.
01:18:43 Speaker 5
So and the.
01:18:44 Speaker 5
Fewer active strategies you have, the more inefficient the markets will become, thereby inviting active strategies.
01:18:51 Speaker 5
You know, I think it’s a good question.
01:18:53 Speaker 5
I I think there are some managers who are who can probably do it.
01:18:56 Speaker 5
But I think it’s a very tough thing to do.
01:18:58 Speaker 2
Turn off, please.
01:19:00 Speaker 2
Public investor actives selective.
01:19:04 Speaker 2
This right here is what I hear.
01:19:05 Speaker 2
I’ve been thinking a lot about this.
01:19:08 Speaker 2
I think that I have.
01:19:10 Speaker 2
Disproportionately benefited.
01:19:13 Speaker 2
From being at the right place at the right time, backed by enormous amounts of central bank money.
01:19:20 Speaker 2
And so I think we all have them.
01:19:23 Speaker 2
I think it is very difficult to be a public market individual stock picker.
01:19:29 Speaker 2
In a world where the central banks are constantly meddling.
01:19:35 Speaker 2
Because when they do the best thing that you can do.
01:19:40 Speaker 2
Is belong the market data?
01:19:42 Speaker 2
And the more concentrated you are, the better returns you would have delivered since 2008 when the central banks started to get very aggressively involved.
01:19:52 Speaker 2
When individual stock pickers reigned, the universe was when central banks were largely on the sidelines, and so there was all kinds of dispersion, price dispersion, meaning good outcomes, bad outcomes, loss of alpha right, meaning your performance was independent of the market.
01:20:13 Speaker 2
But since 2000?
01:20:14 Speaker 2
Eight, it’s largely been bailed out that screwed in the market and the folks that have done exceedingly well with those intact because we delivered the best beta.
01:20:24 Speaker 2
And every time we confuse alpha and beta, we get over our skyships.
01:20:30 Speaker 2
And there’s always some big help, you know, blow up.
01:20:35 Speaker 2
So I think my, my general take away is that if the central banks stay on the sidelines.
01:20:42 Speaker 2
Individual stock picking, reins and active management convince if they continue to be involved and do automated easing and all of this other stuff.
01:20:53 Speaker 2
Index funds that are long concentrated market beta will always outperform came along I was watching Warren Buffett answer some questions and one of the questions and this goes to the law of big numbers by BlackRock.
01:21:06 Speaker 2
He was saying listen.
01:21:08 Speaker 2
The reason I did better earlier in my career than later in my career on a.
01:21:12 Speaker 2
Percentage basis is.
01:21:13 Speaker 2
Because I was placing had a small amount of capital and I was placing it on smaller bets.
01:21:19 Speaker 2
Smaller ideas and themes.
01:21:21 Speaker 2
And then as I had a bigger shift back, I had to find bigger ideas to put more money to work and therefore more people who are looking at those.
01:21:28 Speaker 2
And so those assets were not undervalued.
01:21:31 Speaker 2
And so I found that very like.
01:21:33 Speaker 2
Some insightful in terms of when you participate in the market, if you’re trying to pick between very large bets like CO2 and TPG and Tiger, we’re doing in the growth space.
01:21:47 Speaker 2
Like now everybody knows that these companies, everybody knows strikes a winner.
01:21:51 Speaker 2
Everybody knew Airbnb and Uber were winners.
01:21:53 Speaker 2
You know, in the late stage of the private everybody knew Facebook was a win only says part mortgage.
01:21:57 Speaker 2
If you’re battling that out, you know Yuri Milner is going to come over the top and pay 2 billion more than you or Masayoshi Son’s gonna pay 5 or 10.
01:22:05 Speaker 2
Billion dollars more than you.
01:22:06 Speaker 2
Where is the alpha.
01:22:07 Speaker 2
There you know where where is the game and.
01:22:11 Speaker 2
OK, there we go.
01:22:13 Speaker 2
And so they were playing a different game and that’s, you know, I started trading this past two weeks because I’ve never traded public docs and I wanted to add it at the skill set.
01:22:21 Speaker 2
So I I put a couple million bucks into an account and I’m just trying to actively figure out how does value work there and.
01:22:30 Speaker 2
You know, I’m just starting to make trades that I want to hold for 10 or 20 years and we’ll see if I can beat the market.
01:22:34 Speaker 3
But that’s.
01:22:35 Speaker 2
The other.
01:22:35 Speaker 2
Thing is, what do you want to spend your life doing it the.
01:22:37 Speaker 3
Index if you.
01:22:38 Speaker 2
Can put money in the passive index and not do any.
01:22:40 Speaker 2
Work well, you know, that’s attractive as well.
01:22:43 Speaker 2
So fast.
01:22:44 Speaker 2
What do you think in terms of active management?
01:22:47 Speaker 2
You know, in these public markets from the size of the best.
01:22:50 Speaker 2
They have to win.
01:22:51 Speaker 5
Like I said, I think it’s very hard to beat the market consistently.
01:22:54 Speaker 5
I think it’s a.
01:22:55 Speaker 5
Very tough profession.
01:22:56 Speaker 5
I’m I’m sure there are people who can do it, but I don’t know if it’s easy to predict who those people are, so.
01:23:03 Speaker 5
Look, I see him.
01:23:04 Speaker 5
I think it’s something that can be done, but I just think the tough, tough game, I mean.
01:23:09 Speaker 5
What we do as private investors is a little different, right, because not everybody is in a position to buy shares, right?
01:23:16 Speaker 2
Yeah, not available to.
01:23:17 Speaker 2
You don’t even know the company.
01:23:19 Speaker 5
Access is limited and information is limited.
01:23:21 Speaker 5
And in exchange for that sort of preferential access that we get, we actually have to do work or when you’re when, yeah, when you’re a public investor in a company, Disney or whatever, you don’t do any work.
01:23:33 Speaker 5
You’re not involved at all.
01:23:34 Speaker 5
We do a lot of work for the companies.
01:23:36 Speaker 5
And that’s why they choose us, and so it’s not.
01:23:39 Speaker 5
You know, if you’re not competing, that’s the whole.
01:23:41 Speaker 5
I think the public markets are is so competitive.
01:23:43 Speaker 2
Are you tempted though looking at these prices and ’cause?
01:23:46 Speaker 2
I was looking at a company that was trading at 50 times revenue last year.
01:23:50 Speaker 2
They’re racing again. They doubled their revenue, so now they’re at 2025 times revenue they’re raising at last evaluation and then I looked at the public market constant, they’re trading.
01:23:58 Speaker 2
At 6:00.
01:23:59 Speaker 2
So now I’m like, wait a second and then obviously growth.
01:24:01 Speaker 5
Well, you look at the growth rates you.
01:24:02 Speaker 2
Rates a little different.
01:24:03 Speaker 5
Look at growth rates. So.
01:24:04 Speaker 2
Now the growth rate was three.
01:24:05 Speaker 2
The growth rate in this example was three times fat greater than the public market comps or how would you assess that then?
01:24:11 Speaker 5
Well, what we’re seeing right now is that pretty good staff companies are growing you know maybe on a trailing basis at groups reacts and you know prospectively they’re growing call it two and half X, they’re trading right now, not trading, but basically deals are getting done at 20 * a year or 20 years.
01:24:27 Speaker 3
Which are our Vickers current run rate.
01:24:30 Speaker 5
Yeah, the current error is.
01:24:31 Speaker 2
If you’re not getting that like bonus like, here’s your projected next year, we’re.
01:24:34 Speaker 2
Going to give.
01:24:35 Speaker 2
It based on that this is current.
01:24:36 Speaker 5
No, no. Current error is about 202223 times there are. Maybe it was like 100 times.
01:24:41 Speaker 2
Down from what? Last year 100.
01:24:44 Speaker 5
As a rule of thumb so now there are some where there you know deals are getting done in the high 20s I’d say or even 30 if they’re if you believe that by the end of the year it’ll.
01:24:54 Speaker 5
Be more like 20, no?
01:24:55 Speaker 5
But I I.
01:24:56 Speaker 5
Think the new levels are landing at?
01:24:59 Speaker 5
2020 something times air art now.
01:25:03 Speaker 5
Why does that make sense relative to the?
01:25:04 Speaker 5
Public class companies. Well, like you said, the SAS index is trading at roughly 6 times, but it’s only 20% average growth.
01:25:12 Speaker 3
Right.
01:25:13 Speaker 5
And so you know.
01:25:14 Speaker 2
You’d be talking about 10 times the growth rate.
01:25:14 Speaker 5
There’s only three years.
01:25:16 Speaker 5
Right, not like grows fast.
01:25:18 Speaker 5
Companies are trading it.
01:25:19 Speaker 5
Like 7 times.
01:25:21 Speaker 5
That’s for like a 40% grower. We’ve talked about this before.
01:25:25 Speaker 5
Listen if you’re.
01:25:26 Speaker 5
Tripling year over year and.
01:25:27 Speaker 5
You pay 20 times, there will be.
01:25:28 Speaker 5
A7 times next year.
01:25:30 Speaker 5
But if you’re going.
01:25:31 Speaker 4
Two 2 1/2.
01:25:32 Speaker 5
Three acts next year, that’s way faster.
01:25:34 Speaker 5
So yeah, I think there’s actually an arbitrage there.
01:25:36 Speaker 5
I mean, This is why we.
01:25:37 Speaker 5
Like doing private crap investing right now.
01:25:40 Speaker 2
Deals are getting done.
01:25:41 Speaker 2
I will say that the people who I’m seeing who are really struggling, free bird, are the people who didn’t turn on.
01:25:47 Speaker 2
I’m sorry about the very early stage.
01:25:48 Speaker 2
They didn’t turn on revenue, they were making progress.
01:25:52 Speaker 2
In team building and culture and features, but they just weren’t focused on the revenue side and my Lord, people got a lot of credit and 50 million, $100 million valuations without the revenue turned on and that now they’re faced with not being able to raise.
01:26:09 Speaker 2
Money, full stop.
01:26:11 Speaker 2
What are you seeing on your side for both in terms of gel in the private markets?
01:26:15 Speaker 2
Well, it’s enragingly.
01:26:19 Speaker 3
It’s not easy.
01:26:21 Speaker 2
Unpack it.
01:26:23 Speaker 2
Let’s not well, what are the conversations like?
01:26:26 Speaker 2
Give us the anecdotal information.
01:26:28 Speaker 2
On the United?
01:26:29 Speaker 2
Kingdom number of turn sheets get pulled, so I.
01:26:31 Speaker 2
Think we can’t?
01:26:32 Speaker 3
Oh really?
01:26:33 Speaker 2
Yeah, we’ve heard a lot about.
01:26:35 Speaker 2
Companies that kind of during the Q1, early Q2 timeframe had turned, sheets weren’t closing, got delayed out.
01:26:45 Speaker 2
And there’s a number of.
01:26:48 Speaker 2
Kind of examples of repricing or the investors comeback markets have changed, let’s repricing or hey, we’re not going to do this deal anymore, we’re going to sit on the sidelines and wait for the market settles or our LP’s actually aren’t going to let us find new stuff. So. So there’s a lot of those certain characters.
01:27:05 Speaker 2
For people, what does that mean you?
01:27:09 Speaker 2
Yeah, investor, you know, investors have LP’s, they have investors themselves and their LP’s are coming to them and saying do not put more money out.
01:27:16 Speaker 2
Right now we are telling you we are not going to wire our money to you.
01:27:20 Speaker 2
We need you to.
01:27:21 Speaker 2
Even though they’re contractually obligated to.
01:27:24 Speaker 2
Theoretically they hit, key contractions begin to, but obviously these are long term partnerships and so when an LP you know or group of LP, said, guys, we’re not comfortable with you deploying money right now.
01:27:34 Speaker 2
You know, you don’t know 10 year partnership, 15 year partnership, but then you’re gonna as another investor in the fund you’re going to say, OK, I’m not kind of listen to.
01:27:42 Speaker 2
That right now, now.
01:27:43 Speaker 2
The bigger issue is in series BC&D where companies come.
01:27:48 Speaker 2
You know, have some tractions, have some performance, have raised a bunch of capital, have done a bunch of work and investors don’t know what they’re worth.
01:27:55 Speaker 2
They’re like, hey, this thing worth 25 million or 125 million or 500 million. Last year, you could raise money as 500 million.
01:28:02 Speaker 2
I mean, look at what happened with one of those crypto things with crypto trading platforms. They raised $500 million last yr.
01:28:09 Speaker 2
And they just sold the business for reported $25 million after being charged with five billion a year ago.
01:28:14 Speaker 2
Yeah. So the whole thing might have been more like 275 million.
01:28:15 Speaker 3
And it worked out.
01:28:18 Speaker 2
And it was in some ways that and and so but but series, series, any people seem to be.
01:28:18 Speaker 3
Yeah, we don’t know.
01:28:19 Speaker 3
We don’t know.
01:28:23 Speaker 2
Pretty active again.
01:28:24 Speaker 2
The app again, but the price is now for.
01:28:27 Speaker 2
Lower? Yeah, he reverted, fitting for six to 15 series days, happening 15 to 25. It’s a lot easier to get a deal done in a few days because people say, hey, look, I’m gonna give you this.
01:28:37 Speaker 2
You say, OK, I’ll take it. I need the money series. BT&D is where there’s this whole fight because there’s existing investors, existing shareholders who are saying I don’t want to take a 50% right down to 70% right down, a 30% right down over the last round.
01:28:49 Speaker 2
And fighting, and then doing inside rounds and grids, notes and all sorts of other shenanigans to not have to take a negative mark on their.
01:28:56 Speaker 2
Book, yeah.
01:28:57 Speaker 5
Well, so what’s interesting here is that you think about like where the opportunity is in the market right now.
01:28:57 Speaker 3
Uh, wondering from that.
01:29:04 Speaker 5
And I think one of the things that happened in the boom is that everyone got pushed to.
01:29:07 Speaker 5
Go earlier earlier.
01:29:08 Speaker 5
Because deals were so competitive.
01:29:10 Speaker 5
And so you know in the South business normally 1,000,000 of air or was considered the rule of thumb for getting a series for basically graduating to a Series A like you are ready to go from seats or Thursday when you have a million of AR as we know during the boom last.
01:29:24 Speaker 5
Year that number kept going down you know half 1,300,000 as anyone see crazy deals get done there were pre revenue with price at 100 plus.
01:29:27 Speaker 2
Yeah, 500 cents.
01:29:34 Speaker 5
We never did any of those kinds of deals, period.
01:29:35 Speaker 5
We discussed this is crazy, but they.
01:29:37 Speaker 5
Definitely happen well.
01:29:39 Speaker 5
See what’s the dynamic now?
01:29:40 Speaker 5
Which is?
01:29:41 Speaker 5
Let’s say this as fast startup that has a million of there are they can do a series at 50 or we can just wait until they get the five million of error and then pay 20 times and do it.
01:29:52 Speaker 5
At 100 free.
01:29:53 Speaker 5
Which of those is a better risk adjusted return may tell you there’s a lot of risk in going from one millionaire or five millionaire or as.
01:29:59 Speaker 1
That’s hard.
01:30:01 Speaker 5
It’s hard.
01:30:01 Speaker 5
There’s a lot of.
01:30:02 Speaker 2
You know, the sales team here is just interviewing through the founders, selling the product.
01:30:02 Speaker 5
Things are off the rails.
01:30:06 Speaker 5
Yeah, you need to start scaling A-Team. You need real sales capacity, but also a lot of startups that could sort of hack together and cobble together 1,000,000 of error are based on non scalable tech.
01:30:18 Speaker 5
That various startups, incubators, piece like you.
01:30:20 Speaker 2
So do things that don’t scale program product or it’s OK to do that from zero to one but.
01:30:21 Speaker 5
Don’t be careful.
01:30:23 Speaker 5
Right.
01:30:26 Speaker 2
Not one to 10.
01:30:27 Speaker 5
Right, well, well, or it’s it’s not that it’s not OK if you said it doesn’t work right, like you’re not going to cobble together 5,000,000 or they’re all using altogether 1,000,000 there. Or you can use the cheat.
01:30:37 Speaker 5
Code to get there.
01:30:38 Speaker 5
So what I’m saying is there’s a lot of risk and goes from one to five you find out whether the parts are really scalable.
01:30:42 Speaker 5
So what is the better deal?
01:30:44 Speaker 2
Wait for 100.
01:30:46 Speaker 5
Rachel Price 100 or 120 million free or doing the deal at 40 to 50 now. If you love, like, if you love the company, you want.
01:30:53 Speaker 5
To get in as early as possible.
01:30:55 Speaker 5
Yeah, well, I I think you’re going to start seeing a dynamic were in the same way that last year everyone earlier and earlier you’re going to CVC such a step back and go a little later and later.
01:30:55 Speaker 3
Right.
01:31:04 Speaker 3
Prove it to us.
01:31:05 Speaker 3
A dead man sound.
01:31:07 Speaker 2
Nobody should be putting money into.
01:31:08 Speaker 2
Children once his wife.
01:31:11 Speaker 3
But what does it?
01:31:11 Speaker 4
That’s all I am.
01:31:12 Speaker 2
Do unless unless you’re in business, unless you’re in the business of running the fee generating machine.
01:31:17 Speaker 2
If you’re really trying to generate alpha, you have to have a sense of what’s actually happening in the world right now if you’re just trying to deliver the market beta and run an index.
01:31:28 Speaker 2
Then yeah, you’re right, you should ignore this idea that there could be more price adjustments, but if you look at the public markets, which is again the ultimate terminal buyer.
01:31:39 Speaker 2
They have more cash than they ever had since 2008, which means that there is no reason to buy become obsolete.
01:31:46 Speaker 3
We’re talking about private companies.
01:31:48 Speaker 2
It all ultimately ends up in the public markets, and so if the public markets are saying there is no reason to buy their stuff, it trickles down.
01:31:57 Speaker 2
So then the crossover investor who has a public, private business 13 alerts on the public side on completely derisked and in cash.
01:32:05 Speaker 2
Hence, on the private side, I’ll just be a little bit more circumspect and wait.
01:32:08 Speaker 2
As David said, I’ll just wait six months and put even more money and later I’ll actually have a better IR and I’ll make the same profit dollars.
01:32:17 Speaker 2
So then the theory B&C firm who used to feed those deals?
01:32:21 Speaker 2
For the crossover folks.
01:32:23 Speaker 2
Are like, Oh well, if you’re waiting.
01:32:25 Speaker 2
I don’t want to have to write a check to support these folks.
01:32:28 Speaker 2
My whole point was to have you mark up the.
01:32:30 Speaker 2
Deal so I could.
01:32:30 Speaker 2
Raise a new fund.
01:32:32 Speaker 3
They slow down.
01:32:33 Speaker 2
And then that goes back to the CS eight person who’s like, well, wait a minute. You know, the reason I paid it at 53 was because I thought you would step in and.
01:32:42 Speaker 2
Buy it at 100.
01:32:43 Speaker 2
And within days slow down.
01:32:45 Speaker 2
So all I’m saying is I think that we are at the point of the cycle where Constipation is setting it and This is why you’re seeing such a downtick in deal velocity and and dollars put to work.
01:32:57 Speaker 2
This is great advice I want everybody to take.
01:33:00 Speaker 2
I am going to take the opposite advice and I’m going to do twice as many deals in the same stage as everybody else.
01:33:05 Speaker 2
But I’ve encouraged every venture capitalism seed fund to take trim off advice.
01:33:09 Speaker 2
I’m doing the opposite because a five person company.
01:33:12 Speaker 2
Is an advice.
01:33:12 Speaker 2
This is just the market observation and just running about throws cards.
01:33:14 Speaker 2
Hope everybody takes that as the truth, because.
01:33:18 Speaker 3
What I’m saying.
01:33:19
Thing is.
01:33:20 Speaker 2
The founders who are raising and have real businesses are so sharp right now and so focused on costs and profits and what matters, and they have eliminated all the **** that doesn’t.
01:33:30 Speaker 2
There’s a whole contingent.
01:33:32 Speaker 2
I don’t know if you’re seeing this axe and say it’s one out of five, one out of four that are like, I understand what’s happening here and I’m going to take advantage of this.
01:33:39 Speaker 2
Moment in time and I’m going to just drive revenue and profit.
01:33:41 Speaker 3
So what?
01:33:42 Speaker 2
Instead of $250 billion that’s been put to work in the last two years, that need to get up around, yeah, it.
01:33:48 Speaker 2
Doesn’t matter to me.
01:33:48 Speaker 2
All I care about is meeting young companies that.
01:33:50 Speaker 2
Are growing with revenue, but I think they’re they’re still.
01:33:52 Speaker 3
I’m just.
01:33:54 Speaker 2
Yeah, yeah.
01:33:55 Speaker 2
No, that’s that’s a lot of indigestion.
01:33:58 Speaker 2
Yeah, they have to cut their staff by half.
01:34:00 Speaker 2
And get to profitability.
01:34:01 Speaker 5
Ultimately, the way that valuations matter or price levels matter is there’s an entry price and exit price, and ideally, if you can time it right, you want to invest when valuation levels are low.
01:34:13 Speaker 5
And you want to exit when valuation levels are high.
01:34:16 Speaker 5
If you were, if you see last year, you should’ve been realizing as much as you can because valuation was really hot.
01:34:22 Speaker 5
There was a good tweet by one of my Christmas colleagues and altimeter basically saying she was talking to LP’s and asking what they care about and what she reported LP’s is saying is that.
01:34:34 Speaker 5
As a refund that’s more than five years old and even distribute during.
01:34:37 Speaker 5
The best kept window.
01:34:38 Speaker 5
Ever, which was 2018 or 2021. It’s a hard no. Yeah, we’re not going to be re upping with you.
01:34:44 Speaker 2
I’ll say it even more if you’re if you’re a venture investor who took a longitudinal view on public markets.
01:34:50 Speaker 2
Box and then has now seen 60 to 70% write downs of those same thoughts that you could have distributed.
01:34:57 Speaker 3
You should still.
01:34:58 Speaker 2
Have something to answer to?
01:34:59 Speaker 2
That’s me.
01:35:00 Speaker 2
No sense.
01:35:01 Speaker 2
It turns out that’s the skill of private market investing in the skill of public market investing are different, even if all you’re doing is delivering the market data.
01:35:10 Speaker 2
It’s still.
01:35:11 Speaker 2
The housing success unless it remember I was saying should I distribute it to the shares of Robin Hood?
01:35:15 Speaker 2
Should I hold?
01:35:16 Speaker 2
Them what should I?
01:35:16 Speaker 2
Be doing UI distributing.
01:35:16 Speaker 2
You the.
01:35:19 Speaker 2
I just did everything.
01:35:19 Speaker 2
You know and.
01:35:20 Speaker 2
And and in terms of.
01:35:22 Speaker 2
Do you feel like a genius now?
01:35:24 Speaker 2
Because her LP?
01:35:25 Speaker 2
Should say thanks in.
01:35:26 Speaker 2
No, I mean you some of them are saying that I feel smart about.
01:35:26 Speaker 3
Should be sent to Franklin.
01:35:29 Speaker 2
I’ll be honest is we had I think it.
01:35:31 Speaker 2
Let’s say I’m.
01:35:32 Speaker 2
Making a number of four to five times.
01:35:33 Speaker 2
We were offered the opportunity to trim our positions in secondary with our winners from people who wanted to buy secondary shares.
01:35:41 Speaker 2
I did it probably four to five times and I’m just taking myself.
01:35:44 Speaker 2
I didn’t do it the 5th or I didn’t ask.
01:35:46 Speaker 2
They would take more because, my God, we were able to clear some positions at very high valuations that are now lower than that in the private markets and send cash to our LP’s and get our, you know, get over hurdles.
01:35:57 Speaker 2
And our first two funds.
01:35:59 Speaker 2
Which you are so smart about.
01:36:01 Speaker 2
Any state you should feel so so good about.
01:36:04 Speaker 2
That is, that is really hard, what you did, and I think people underestimate how hard it is.
01:36:09 Speaker 2
It is really hard to actually return more money than you have taken in.
01:36:14 Speaker 2
Our investments but unsalted fries in basement?
01:36:14 Speaker 3
Besides, it’s just a simple statement.
01:36:18 Speaker 2
And and by the way, it was hard in the last 10 years where we’ve had basically a massive up market in the four of us.
01:36:26 Speaker 2
Frankly, benefited from the extraordinary luck of being intact. Yeah, I know, super lucky. I think the big thing that’s going to happen right now, I’m seeing it all over the place, is M&AI think it’s going to start kicking up.
01:36:36 Speaker 2
Just today, Amazon acquired one medical for 3.9 billion one.
01:36:39 Speaker 2
Medical operator network of clinics if you don’t know $3.9 billion enterprise value for 180.
01:36:44 Speaker 2
Two franchises, which is 21 billion of franchise.
01:36:47 Speaker 4
Look at.
01:36:47 Speaker 2
So what happened to their little bit of stock right now? I know it was from the 60 in the peak in February of 2021.
01:36:54 Speaker 2
27 in name that.
01:36:57 Speaker 2
They basically bought at the same price they were.
01:36:59 Speaker 2
Trading out in January.
01:37:00 Speaker 2
Well, my point is, you could buy a McDonald’s.
01:37:02 Speaker 2
Franchise for two.
01:37:03 Speaker 2
Million or you could buy the company that fixes the people that eat at McDonald’s for 21 milliseconds.
01:37:07 Speaker 2
Well, by the way, at McDonald’s you can’t make money selling pharmaceuticals and up selling, you know, other stuff that Amazon is going to start marketing.
01:37:15 Speaker 5
So I think it’s super interesting that I think it’s super interesting that Amazon getting into this business last, I mean that is really interesting.
01:37:22 Speaker 2
I mean they clearly have an economic model that’s.
01:37:26 Speaker 2
Of some significant synergies.
01:37:27 Speaker 3
McHale footprint in visual footprint.
01:37:30 Speaker 2
Well, they, yeah, there may also be kind of a supplement pharmaceutical kind of upgrade opportunity.
01:37:35 Speaker 2
There’s synergy in this business that I don’t think that they I finally think about things that what they’re getting is also not just the physical locations but a network of doctors that can be fella helped.
01:37:45 Speaker 2
I don’t know if you guys have ever used one medical, but they do really.
01:37:49 Speaker 2
You know, easy zoom telehealth services.
01:37:51 Speaker 2
And so you could hop on, get a prescription and have it still sold by Amazon.
01:37:54 Speaker 2
It shows up at your doorstep in under an hour.
01:37:56 Speaker 2
It’ll be an incredible synergy for that business and probably a real value driver, not just at the core unit, but with treatments and other things are going to sell through.
01:38:05 Speaker 2
Your one medical doctor will provision the blood test.
01:38:09 Speaker 2
He or she will analyze those blood tests.
01:38:11 Speaker 2
Over at Tele health.
01:38:13 Speaker 2
They will prescribe a better diet that will be sent to Whole Foods who will learn but not start.
01:38:19
And then.
01:38:22 Speaker 2
Yeah, hopefully he’ll give me something.
01:38:23 Speaker 1
Amazon is makes so much.
01:38:24 Speaker 2
Sense for Amazon to expand into built out retail footprints because that business model now gets more and more complete by the day.
01:38:33 Speaker 2
Where you become so ingrained and enmeshed in this era, these performers unrealistic.
01:38:37 Speaker 2
At the Amazon Prime is the driver of Amazon signal.
01:38:44 Speaker 2
That’s another Amazon Prime rock.
01:38:47 Speaker 2
So I know it sounds silly, but two days delivery route delivery is starts about your subscription.
01:38:48 Speaker 3
Absolutely no.
01:38:50 Speaker 5
It’ll be.
01:38:52 Speaker 4
I would.
01:38:52 Speaker 2
But then you got out of it.
01:38:54 Speaker 2
You guys are dollars that within a year or after closing the deal, they’re going to massively expand the Tele health footprint of romantic ludicrous ’cause one medical had to go out and do customer acquisition to build, acquire customers to make money.
01:39:07 Speaker 2
Doing Tele health services and they’re spending chapter $1000, probably CPA to acquire these customer.
01:39:13 Speaker 2
Then why did you do this?
01:39:14 Speaker 2
Why didn’t people?
01:39:15 Speaker 3
Gathered this picture.
01:39:16 Speaker 2
Amazon’s already got the customers. They’ve got 70 million for everybody.
01:39:21 Speaker 2
By the way, I.
01:39:21 Speaker 2
Answer Another thing I know another thing.
01:39:23 Speaker 5
People don’t know how to do messy things in the physical world. They don’t know how to do service. I mean, Amazon’s been working warehouses.
01:39:28 Speaker 2
OK, what about Apple?
01:39:30 Speaker 2
Apple knows how.
01:39:30 Speaker 2
To do stores.
01:39:31 Speaker 5
Like Apple knows how to do 4 products in a beautifully designed showroom.
01:39:32 Speaker 2
Right.
01:39:34 Speaker 2
Apple has second $30 billion services business now, he’s saying.
01:39:36 Speaker 5
Now Amazon knows how to get in the nitty gritty and the nuts and bolts operations grace.
01:39:39 Speaker 2
Yeah, yeah, I know world.
01:39:42 Speaker 2
Yeah, real world stuff.
01:39:42 Speaker 2
The other thing that’s really interesting about this Amazon deal is that it was done with Bezos, not at the house.
01:39:46 Speaker 4
And I think it.
01:39:47 Speaker 2
You know, begs the question and I can answer around all these guys going to continue to innovate like this.
01:39:52 Speaker 2
And I think right now the jury saying yes, they are going to continue to push the the synergies they can drive from this business by expanding to ancillary services and industry. And it’s really impressive to see them doing this without without diesels running the day-to-day.
01:40:07 Speaker 2
As a shareholder, I feel that.
01:40:09 Speaker 2
So really great to see.
01:40:11 Speaker 2
I yeah, I mean this is where like they could buy.
01:40:14 Speaker 2
Door dash, Uber, Lyft, those kind of real.
01:40:16 Speaker 2
No, just thinking, dude, that’s just like I do with Whole Foods.
01:40:20 Speaker 2
They’re buying assets that there’s tremendous leverage and synergy out is very cheap there, barring the company at the same price it was trading at a few months ago.
01:40:28 Speaker 5
And they have a great, very great CEO at one medical is a friend.
01:40:31 Speaker 5
Of mine, Amir Rubin, Congrats.
01:40:33 Speaker 3
Right. Yeah.
01:40:34 Speaker 2
Do you want your beats up?
01:40:37 Speaker 5
I never want ** **** ** this.
01:40:38 Speaker 1
Field so I’d eat syndrome.
01:40:40 Speaker 1
No, I would.
01:40:41 Speaker 1
I would just close it.
01:40:42 Speaker 2
GTA5.
01:40:43 Speaker 1
Second graph right now if I was in.
01:40:46 Speaker 5
That company, I’m not there.
01:40:48 Speaker 2
I’m shocked you haven’t seen the J.
01:40:50 Speaker 2
Cole victory lap.
01:40:51 Speaker 2
He goes on some podcasts.
01:40:53 Speaker 2
Health Bloomberg that DCS are going to get pinched for insider trading all these tokens and lo and behold on the Wall Street Journal’s three guys like I guess a diet coin based top 10s for basically insider trading.
01:41:05 Speaker 2
These token trails start running it by buying them in his wallet and stuff and.
01:41:10 Speaker 3
So since we launched.
01:41:13 Speaker 3
He can’t leave.
01:41:13 Speaker 4
2nd that would be our repair job every.
01:41:21 Speaker 1
Last week makes the product.
01:41:25 Speaker 2
I told everybody.
01:41:26 Speaker 2
Like, if it’s if it smells like a security and people are buying it for that reason, for it to appreciate, don’t be surprised at the FCC.
01:41:32 Speaker 2
You know, starts having tips dropped on them that different VC firms in cahoots with law firms, in cahoots with everybody were liquidating their positions.
01:41:41 Speaker 2
We talked about liquidating positions as being the goal of venture capital.
01:41:44 Speaker 2
They created a shadow economy next to securities law and said we’re going to start liquidating these things, but under what they made.
01:41:52 Speaker 2
The wolves up under which they could liquidate them.
01:41:54 Speaker 2
I’m not picking on any firm or anybody.
01:41:55 Speaker 2
Well, we’ll see over time who gets pinched.
01:41:57 Speaker 2
But you know, if you decide you’re going to talk yourself into this is not a security, even though it kind of feels like one that’s on you.
01:42:06 Speaker 2
That’s our new as the person buying the tokens, issuing the tokens, giving the legal brief from the tokens.
01:42:12 Speaker 2
I think people suspended disbelief and talk themselves into thinking that they weren’t trading securities and I think the SEC.
01:42:18 Speaker 2
Now that everybody lost their money is going to just kick off one firm after another and it’s going to be massive settlements.
01:42:24 Speaker 2
It’s going to be three or four years of litigation, so got a victory lap.
01:42:27 Speaker 2
It’s just it was such an obvious observation.
01:42:29 Speaker 2
We all saw.
01:42:29 Speaker 2
It, I mean, how do you liquidate your shares in a company that has no product in there?
01:42:36 Speaker 2
Like, come on, come on.
01:42:38 Speaker 2
People knew what they were doing and if they get the book thrown.
01:42:41 Speaker 2
Out on May deserve it.
01:42:42 Speaker 2
All right, everybody, there’s been another amazing episode, even though Sachs was going to say it’s the worst one for writing this dating site.
01:42:49 Speaker 5
I like it.
01:42:50 Speaker 2
I do that so.
01:42:51 Speaker 1
Late is that real?
01:42:52 Speaker 1
That’s not.
01:42:52 Speaker 2
That makes sense.
01:42:53 Speaker 2
Is that assume background?
01:42:55 Speaker 2
So I guess that means zoom plus?
01:42:56 Speaker 5
Take your photos.
01:42:57 Speaker 5
We can all use it.
01:42:58 Speaker 2
Love you boys.
01:42:59 Speaker 2
Love you baxis.
01:43:00 Speaker 2
Alright, we’re back in the groove.
01:43:00 Speaker 1
That’s it.
01:43:01 Speaker 2
Back after.
01:43:03 Speaker 5
You let your winners lie.
01:43:06 Speaker 2
Raymond James.
01:43:08 Speaker 4
2nd instead we open source it to fans and Asian.
01:43:13 Speaker 4
Sound crazy?
01:43:26 Speaker 2
That’s my dog.
01:43:34 Speaker 2
We should always get a room.
01:43:36 Speaker 2
Georgie, but they’re also useful perspective.
01:43:38 Speaker 2
Have sexual.
01:43:39 Speaker 4
Tension, but previously she released this out.
01:43:45 Speaker 4
Your feet.
01:43:47 Speaker 2
Where did you get merges back?