SPEAKER_05: Hey, everybody. Hey, everybody. Welcome to the all in podcast with us today again. The Queen of Kenai David freeburg, David Sachs, the rain man himself. And of course, the dictator here chum off. And let's get ready. It's time. chum off. And sachs. Here it comes, everybody. Mm hmm. Sax is ready in the red corner. Representing Richard
SPEAKER_05: Nixon, Ronald Reagan, and rich people everywhere. David, the
SPEAKER_06: rain man, Sachs, somebody's got a new corner representing you. LBJ the forgotten the underdogs, the woke left chum
SPEAKER_06: off poly hop.
SPEAKER_05: Rain Man David. And I will also be representing john f kennedy, who said
SPEAKER_00: arising who said a rising tide lifts all boat and maybe even some Bill Clinton Bill Clinton. Don't forget, don't forget the
SPEAKER_02: champion of the left and the right. Yeah. Bill Clinton did a great job. He ended he ended the welfare state.
SPEAKER_05: All right. So here we go, folks. In show housekeeping, we do need to point out that we've been running some polls. The fans of the show have been running polls. And I don't even know why I'm bringing this up because I got barbecued in them. We have
SPEAKER_06: three polls we need to share with the audience from Twitter.
SPEAKER_05: The first is if you can have just one of the all in pod besties to mentor you and your startup growth, who would it be and why looks like rain man you ran away with that one with 39% the dictator with 34 Queen of Kenwa coming in at 17 and Uber's their fourth investor came in with the measly 8% I will tell
SPEAKER_02: you this is this is why 83% of startups fail. They choose the wrong mentor. Perfect. So I was I was proud to win this one. But
SPEAKER_00: the truth is so termoth was slightly ahead. And then I put my thumb on the scale by retweeting the poll because obviously my followers are more likely to vote for me. So then I shot ahead. And I kept real quiet because I didn't want to mock retweeting it to his 1.2 million followers. And if he had done that he probably would have blown me out of the water. But I kept real quiet till the time elapsed. And then I then I shared it with the group.
SPEAKER_04: Nobody keeps a track of followers, but it's actually closer to 1.5. The only person who knows your follower count better than you
SPEAKER_06: Chabot is Phil Hellmuth. Actually, every morning Phil
SPEAKER_06: Hellmuth subscribe subtracts his number of subscribers from yours
SPEAKER_05: to know the net. Alright, second poll came up. Thanks, Matt for this, by the way, Matt yarger, no friend of mine. All right, per request. Let's do another poll and see the other side of this story. If you could have just one of the all in pod best these moderate your podcast, who would you choose? And it turns out the dictator 31% to my 30.6% a full 1% more than me. I came
SPEAKER_05: in second world's best wingman and Rain Man 21% Queen of King Wa 16% and then most importantly, which bestie would you want in your on your side in a bar fight? I will say Chabot smooth velvety voice that that ran away from me. I'm not
SPEAKER_02: sure I'm going to say it's a velvety voice that that ran away
SPEAKER_04: for him here. Thank you. Yes, I think I think that I think the
SPEAKER_00: audience is just trying to hurt Jason. I think we're just trying
SPEAKER_00: to hurt Jason. That was it. That was it. Jason has heard he's
SPEAKER_04: inadequate by more than 1%. Usually it's measured in inches
SPEAKER_05: not percentages. Somebody was dunking on me on Twitter, and they're like, you're the poorest of all your friends. I was like, always have more powerful and richer friends and you then you don't have to worry about picking up the check. Okay. And then there was another interesting AI breakthrough this way. Did you talk about the bar fight? What was the bomb curious the bar fight one? Hold on. I you're right. I didn't get to that one. The bar fight was Oh, here we go. For some reason, these morons seem to think that your stick legs are going to help them in a fight. Bro, that's a bad I honestly I need
SPEAKER_04: to correct this like that was maybe bad lighting or a bad camera.
SPEAKER_03: Honestly, there's not there. Guys, guys, guys, guys, guys,
SPEAKER_04: honestly, come on. They are not as skinny as people seem to be railing and honestly, I'm happy to you know, if there's a standard way of measuring, okay, you know what, Jason, if there's a standard way if somebody can tell us what is the standard way of measuring leg circumference, I'm happy to submit my, my, my measurements. I don't think they're that skinny. They're really, really anorexic. Super disturbing.
SPEAKER_05: Thank you. You got a lot going on up top. I'm very proud of you. But below the belt. It's not true, bro. I work on my
SPEAKER_04: legs a lot. You know, it's it's it's my it's legs and abs to keep your back strong. I'll tell you one thing this this
SPEAKER_02: podcast will win in a poll is the hosts talk about themselves more than any other podcast on the internet.
SPEAKER_06: Talk about each other in order to make fun of each other. This
SPEAKER_01: should be called the naval gaze podcast. All right. So besties that you most wanted to fight Queen of quinoa coming
SPEAKER_05: in dead last year I'm coming in at 17% Rain Man 32% and Shamath I guess that thirst trap you tweeted got your 39% in that poll. The other thing these polls is why democracy doesn't
SPEAKER_02: work but go on to my I can I can hold my own in a physical
SPEAKER_04: altercation. I think I think you want to moth and I because I
SPEAKER_05: think sax is going to be under the table calling 911 and freeburg is going to try to talk it out and get just absolutely sucker bunch. Like guys, we don't really need to buy.
SPEAKER_04: Jason Jason is the one that would smash the beer bottle, create a shiv and say let's go. I would I would have Jason I would actually pick Jason is number one. If you were going to
SPEAKER_00: be in a bar fight. Jason certainly touts his taekwondo skills. On more than one occasion, he's claimed to be an expert in taekwondo. Can we pull up the video? Isn't there a
SPEAKER_01: video of you doing? Where's the video of Jason pushing help you
SPEAKER_03: make news video if you want to see Jason and a grown man,
SPEAKER_04: another grown 50 year old overweight man fighting. We have video.
SPEAKER_00: That one I don't know if we should show but Nick, you should definitely insert the image of J Cal trying to do the taekwondo kick and it looks like he's about to have a herniated groin.
SPEAKER_05: All right, let's start. Jason, what do you got? What do we got this week? I guess the topic we should get right to is inflation. This is a topic we've been talking about a whole bunch. Because we're printing a ton of money. Everybody seems to think the hedge against inflation is to buy Bitcoin, or do you put your money into equities? And are we actually going to see things other than homes and education, massively inflate? We've seen some anecdotal evidence of this. Tesla increased the price of their cars, used cars have gone up in price, which is a function of the lack of production of some cars during the pandemic. So there might be more multitude of factors there. But just putting it out there, are we going to go? Are we going to face inflation that you know, goods and services are going to just go through the roof and cost? Or do we have enough efficiency in the system that the average consumer is not going to see massive inflation on the products and services they buy? Coming out of the poison isn't the isn't the real issue that Jamal says inflation
SPEAKER_00: is good and he because it creates a quality and he thinks 1979 was a great year. I think you should go straight to that. All right. Let's go give a general discussion.
SPEAKER_05: Let's go. I think we should go to Chamath to explain his tweet
SPEAKER_00: storm. Okay, then I'll respond. Okay, there. So I think David, you got unnecessarily emotional
SPEAKER_04: and personal. That was not again, these these were things that I've learned from someone who I will say without betraying him is an extremely well respected person at an extremely well known institution that basically has helped make a lot of sort of, you know, capital allocators very smart about things and has made people a lot of money. So I was relaying what I learned through him. So let me just relay that again. And I'll just start with this. Whenever you have $1 of income, you can do one of two things with that income, you either consume things, right, so you buy, or you can save and you can put it into investments for the future, right? So consumption and investment. The reality is that most people so the lower 60% of the income distribution, essentially spends above their income, right, the lowest actually spends at so $1 earned is $1 spent, and then the middle two because they have access to credit $1 earned, they spend about, you know, percentage points more than that. When you get to the richest 20% of the population, they're actually able to save and they save about 13 cents of every dollar and they're able to invest in the future. So consumption and investment. The reality is inflation comes through a volume of activity, right? So you as a rich person can go and buy one $100,000 necklace at Tiffany's, it doesn't move the needle for inflation. But when you know, 200,000 people buy $1,000 television, that's felt in the economy, it moves. So inflation comes because of gross tonnage of volume. So you need consumption. And by definition, what that does is it pushes consumption into those, you know, that 60 to 80% of people that are not the top 20%. So what it means is that, you know, you have a volume game of people buying things. And when they buy more of those things, inflation goes up, how do they buy more things, they have more income, because their propensity is to consume. So then you have to ask yourself, well, where is this incremental income coming from? And all he has observed, which I think is very credible is we had the supernatural event in the pandemic, we've now started to print trillions of dollars of incremental consumption. And that's going to start to lead to the most simple ways in which consumption manifests in inflation, which is via commodity prices. What does that mean? Let me state simply, a rich person lives in a well insulated house, drives an electric car, and eats fish. A less rich person lives in a poorly insulated house, lives, you know, drives an SUV, and eats beef. Beef versus fish as a simple example, it consumes 2030 50 100 times more input costs to generate that same pound of protein than a fish does. It's just an example of showing how income distributions and the effects and the consumption patterns of large swaths of people drive different consumption patterns and different consumption behaviors which drive inflation. So all he was trying to represent to me was that idea, which is that we have printed trillions of dollars, we are creating artificial levels of consumption, that consumption will actually drive up commodity prices, commodity prices will actually drive up inflation. Then what he told me was, the best analogy, again, it's not perfect, but it rhymes to the reality is what actually happened in the 1970s. Which is that by having this sort of boundary condition, you have to ask yourself what will happen if inflation rips higher. And, you know, starting in the late 60s through the 70s, that's kind of what you had a same kind of boundary can forget the way in which the money got to people, you know, in this case, it was a government check. But in the late 60s, and early 70s, we had kinds of programs, we had Head Start, we have, you know, AmeriCorps, we had Food Stamps Act, we had the Social Security Act, all of these things were transfer payments. And when you put that much money into the hands of a large swath of people, consumption went up, commodity prices went up, inflation went up, it peaked in 1979. But it also happened that when that happened, the gap between the rich and the poor was the lowest it had ever been. And so I thought that that was a really interesting thing to observe. Okay, sacks. You were triggered, you were triggered by this.
SPEAKER_05: Well, I wasn't triggered. I just said it was to most worst take
SPEAKER_00: ever. And then
SPEAKER_04: David, it wasn't my it wasn't my day you were triggered. It wasn't my day. Well, let me explain what let me explain what's wrong with the
SPEAKER_00: take. I created a PowerPoint. So I pulled it from off. No, it's
SPEAKER_00: not boring. And and your mouth has done it too. So don't don't even go there. I'm gonna do email you guys come and hit me up at the second
SPEAKER_01: half. No, no, free. We're gonna keep the freeberg index high. So
SPEAKER_05: go ahead, sacks. Take us through the PowerPoint. What do you want? I'll keep this quick. Okay, so I've called the PowerPoint.
SPEAKER_00: Jamal source.
SPEAKER_04: David, it says right at the top of disclaimer here is something I learned today. Why is it my day?
SPEAKER_00: Well, you said you responded to me then saying that I didn't like facts. So that was your response. So I am proving I'm going to show you some facts. Okay. So first of all, let's ask the question was 1979 a good year, I don't think you can just cherry pick this one number, the Gini index and say that this was some sort of great year 1979, a severe recession begins, which ultimately leads to negative point 3% GD growth in 1980. The word stagflation misery index become household terms, we had unemployment of 6% on its way to 7.2% in 1980, we had a 13.3% in inflation rate, the prime rate for 30 year mortgage was 11.2%. Wow, wow. Wow. Yeah, good luck trying to buy a house. We had long lines of the gas pump, there was an oil embargo. You guys remember the gas pump lines? I wasn't born yet. But go
SPEAKER_02: on. Yeah, it was crazy.
SPEAKER_00: And then you know, Jimmy Carter declares a national crisis and confidence. This was the so called Malay speech. He was well on his way to becoming a one term president. So what this shows is David that, you know, hold on that no, no, let me just let me just do the takeaway. So the takeaway is that, you know, the Gini index as 1979 was a great year. And you know, the issue is the reason it wasn't is because it's a lot easier to make everyone equally poor than ever than equally rich when the economy does poorly. Guess what the gap shrinks. Then Margaret Thatcher had a great line about this. So long as the gap is smaller, they would rather have the poor be poor. That's a great video everyone should watch on her last speech to Parliament. to moth to moth posted this chart showing this was the percentage of wealth held by the top point 1%. Trump off, we'll go to you next to explain one, two and three. But let me just point out, look at when else the Gini index was plummeting the 1930s. The Great Depression did a great job creating relative equality by making everyone poor. So my point is, yeah, I understand there are these qualities, but you know what creates inequality, economic booms. That's what creates inequality. What we should care about is not just inequality, but economic growth, real wage growth, poverty, how many people are below the poverty line, and concentrations of power. So that's what we should be looking at, not just this Gini coefficient. Let me stop there. I've got other slides, but I'll stop there and let you respond. Sax, go back one slide. The the three points there were just
SPEAKER_04: interesting to me. Number one was LBJ and the war on poverty and all those social programs. Number two, and you spoke about this, but I don't think you're doing a full accurate assessment. What Carter's biggest mistake was, was he stopped the transfer payments, because LBJ started them, Nixon continued them, Carter stopped them. And I think it's important to frame- Explain what transfer payments are for people who don't
SPEAKER_05: understand. Well, it's basically like, you know, there are all kinds of
SPEAKER_04: ways to get money into the hands of individuals. You know, we now talk about universal basic income. That's a way of transferring money from the government and from systemic holders of capital to individuals. Food stamps was a way, the Social Security was a way. There's all kinds of different ways. Welfare was a way until Clinton disassembled that. So I think that what we'll never know is what would have happened if Carter hadn't actually stopped those balance of payments. And the key point is about what happened then afterwards in three. So you had this basically stopping by Carter, he didn't get to reap any of the benefits of it. Reagan comes in and says, you know what, we're going to simplify the tax code. We're going to defund all kinds of stuff, including, for example, all the mental health defunding that he had already done in California that spewed people with mental health disease onto the streets of San Francisco and Los Angeles. And that sort of continued. And then the real cataclysmic change on top of all of this, which sealed the fate of that trend line happened in point number three, which is when George George Bush, in 2001, had this really seminal decision, which is he had the ability to block China from entering the WTO. And instead, he let them in. And he traded that for a vote on the Security Council. And when you think about what really happened there, you will unleashed 1 billion people willing to do anything at a cheaper, faster and better rate you ushered in globalization, you ushered in the gutting of the middle class of America, and you transferred all that wealth creation that could have happened in a more inefficient, but in a balanced way that could have benefited Americans and you ship them abroad to China. So I think it's just interesting to note that basically, since 1979, we've all been singing from the same playbook. And, and I think that maybe what we need to do is figure out whether we need to come back to this idea of shifting the balance of payments back into the hands of individual consumers. And all I'm saying is, without making a judgment, is when you look at what Biden has done in just in the first 60 days, $1.9 trillion of stimulus, and a proposed $3 trillion stimulus package, we're just, you know, we're not even three months into his presidency, and you forecast that forward, it feels like we're entering an era of spend, spend, spend. And that was an opinion of mine, which I believe is actually fairly accurate. I do think it will drive inflation, I do think it'll drive commodity prices. And I think on balance, I do think it will suppress the wealth creation of the rich. And I do think it will give folks that don't necessarily have investments, the ability to make more in real income, which they will spend. Well, okay, just just quickly. So I'm going to begin by
SPEAKER_00: agreeing with the part of Chamath's response that I agree with, which is what happened around 2000 2001, which killed wage growth for the average worker. Chamath is right about that. But it was it wasn't just George W. Bush, it was a bipartisan disaster. In 2000, Bill Clinton pushes Congress to approve the US China trade agreement, and gave them full access to the WTO. This was basically temporary MFN. And look at what he said, he said, economically, this agreement is the equivalent of a one way street, it requires China to open its markets to us in new ways. And it turned out to be a one way street the other way. And then he also said that for the first time, our companies will be able to sell industry products in China made by workers here in America without being forced to relocate manufacturing to China, we'll be able to export products without exporting jobs. Well, gee, the exact opposite happened. So and then and then what happens in 2001 is Bush makes this situation permanent. He grants permanent, what's called permanent normal trade relations, which basically MFN status in perpetuity to China, granting them full access to our markets. And Chamath is right, that that devastated the average worker because all of a sudden, they're being forced to compete with, you know, foreign labor that's potentially making $2 a day, and is not subject to the same labor laws and environmental laws as workers in the US are. So I agree with tremendous about what happened then. But but I got to go back and clean up this view of what happened between 1980 and 2000. Because that's where I think we have this, this disagreement. Let's talk about the China thing for a second. Yeah, we made a
SPEAKER_05: mistake there. We got hoodwinked. We don't have access to their market. I think it's, it would be good to pause for a second and say, Okay, we tried this experiment for 20 years, there was some good that came out of it, our companies were able to grow and become the dominant players in the world like Apple, but an Amazon, right, we did capture a lot of this value. And a lot of people came out of poverty in China, I guess on the margins, that's a good thing, we can all agree. But it's a communist country. And we basically enabled a communist country to become essentially, you know, our counterparty in running the planet and in our leadership positions on the planet. What do we do now in terms of unwinding this? Is there a way to roll this back? Or do we just mute it from this point forward? And how does it become a two way street? Or is that just not even possible, as we've seen with the NBA, and some other companies, Twitter, Google, just not being allowed to even operate in China, who's we America, United States,
SPEAKER_02: the United States, I mean, US citizens, US companies, global companies. I mean, yeah, you know, I think that the challenge is your framework, right? Guys, I think there's one big thing you're forgetting in 2001,
SPEAKER_04: which is, I think that Bush actually traded away access to the WTO so that they could guarantee China's vote when he wanted to go to war with Iraq, which happened in 2003.
SPEAKER_00: Okay, well, two dumb decisions that got worse by being put together. All I'm saying is it was a trade, it was a trade, he
SPEAKER_04: traded access to the WTO in return for their support for a UN resolution to go to war with Iraq.
SPEAKER_00: Look, I, you know, Chabath, you said that I was defending the Republican point of view. I'm not, I'll be the first to say that George W. Bush was his presidency was a disaster. I think it'll go down as one of the worst. He got us into all these stupid foreign wars in the Middle East, he began them. I think the decisions with China were a mistake. So I certainly don't want to defend that. And by the same token, I think the Clinton years were generally great years in America. So this is not a partisan analysis on my part. What do you think about
SPEAKER_05: the China concept here and how we would go forward? And what's what's the path forward with China?
SPEAKER_02: I mean, again, like, I think it comes down to your objective, and who are you solving for? And who should we solve for
SPEAKER_05: democracy, the human species? Well, I mean, I feel like the
SPEAKER_02: point of view that, you know, one government is innately better than another is being tested and proven right and wrong every day right now. And, and I'm not sure that it's fair to say that just because the form of government that the, you know, that the Chinese have kind of adopted and used to govern their country and their people is innately wrong. There's certainly things that are innately wrong in many democracies and that are innately wrong in many non democratic republics. And so I'm not sure it's fair to just say that, you know, that that's really the objective is let's get rid of that communism. I mean, that was an easy kind of simple, you know, check that you could use a few decades ago as a way to kind of rally everyone emotionally towards some cause. But I think there's a lot of businesses today that operate effectively in their own kind of geopolitical cloud. And it's a little bit of a kind of misstatement to think that an American company is an American company. It's not that American quote unquote American companies solely build their stuff and sell their stuff in the United States. Many Americans quote unquote American companies build stuff overseas and sell stuff overseas. And globalization as much as we might want to kind of poo poo the effects it's had on the average quote unquote American worker. It really has transformed the way businesses operate with respect to politics and countries. There's a God
SPEAKER_02: what's the book I can't remember the book but there's a book that speaks to how a lot of large multinational corporations today effectively have to operate as if they were countries into and unto themselves. And so they have competing interests with respect to what the average American or the American government or the American people might have, even though they might be quote unquote American companies, and there might be some intricate tie. And so I'm not sure it's as simple as we have to quote unquote defeat China, we are so intricately tied to the to the economy of China to the workers of China, and vice versa. And I think that it's a much more complicated thing than you know, here's our three point checklist for how do we quote unquote beat China. And that's that's why it's hard. And that's why I think a lot of smart people have, you know, kind of taken on and been challenged by and failed at trying to resolve a path forward where there's this quote unquote looming enemy that is going to become the global economic power which strips the American people of their influence around the world. And you know, that may be kind of the inevitability of the 21st century. I don't think there's a dark inevitability if but I don't know if there's a
SPEAKER_02: simple easy answer. And I don't know if from a from a business point of view, let's say I'm a company, I'm not sure I necessarily feel the effects of one quote unquote country affecting, you know, having more influence globally with other countries and others, it turns out a lot of businesses have greater influence than a lot of governments. And so, you know, one way to kind of think about the evolution of globalization, and maybe even with respect to kind of the notion of what we've been talking about decentralization, is that maybe governments themselves become less important in the 21st century. And it's the kind of decentralized online movements and businesses and you know, other kind of entities that perhaps are not as regulated and controlled and owned by governments. And, you know, maybe the big failure of the 21st century will be governments. We'll see.
SPEAKER_05: Chamath, you have thoughts on China? I'm sorry, that was a bit esoteric, but
SPEAKER_02: No, no, I think it's Yeah, it is an interesting point.
SPEAKER_05: The thing that you're not willing to acknowledge is that
SPEAKER_04: even when GDP shrinks, it's like a it's a it's it's shrinking from a base where there's substantive growth year over year, like, you know, are the GDP in 1969, when LBJ was president was less than a trillion dollars, and the GDP now is like 23 and a half trillion dollars. And so it's been nothing essentially, but a straight line up. And so, you know, this idea that we the inflation causes, you know, the only way that we close the wealth gap is by making everybody poor is not true. We're some people may be getting less rich at the same rate. So they feel poor. But the idea that you actually become poor is just not true. It's a feeling that you have, but it's not rooted in fact.
SPEAKER_05: So when you look at the wealth gap, are you concerned about the gap? Or are you concerned with, you know, the status of the folks on the bottom and how much their lot in life has gotten better?
SPEAKER_00: Yeah, I mean, I'm concerned with both. Actually, there I have a slide on this, too. I would buy this argument. And I've heard this argument from
SPEAKER_04: before from people not as smart as David, I would buy this argument if GDP did something other than go up in an absolute straight fucking line. No, it doesn't. It does. Well, hold on, I'm gonna show let me
SPEAKER_00: show GDP in a second. The first thing I want to discover is that part of the problem with the Gini index is it doesn't fully account for government transfers. This is something I didn't fully know until I researched it after your tweet storm, but basically only 2% of the population. So the publicly reported stats are that 13.5% of the US population lives in poverty. Once you actually take into account all these programs and transfer payments, it's more like 2%. You can see this on this chart on the left here, that the green represents the transfer payments. By the way, I'm not against transfer payments. I think we need a social safety net. I want the social safety net to be as effective as possible. I don't want it to trap people in government dependency. I want it to work. I want it to get people out of poverty and into the opportunity economy. But I absolutely believe we need a social safety net. And we need these transfer payments. And you can see that the green bars there make a huge difference in reducing poverty. The Gini index doesn't really take that into account. Well, how do you fund this these types of transfer payments, the more of a stronger economy that you have, the more that you have a government, the more that you have an economic boom, the more that you see real wage growth, and the ability to fund these programs. Let's go back to let's let's just look at GDP for a second. So if you go back to let's go back to this period, 82 to 2000, I call this the Reagan Clinton boom, I see this as a bipartisan, a relatively bipartisan period, where under Reagan and Clinton, you had GDP growth of almost 4% compared to the usual two, two and a half percent. By the way, this is why Reagan and Clinton left office with huge approval numbers. Despite scandals. Remember, Reagan had Iran Contra, Clinton had Lewinsky, none of that mattered really in the eyes of the American people, because the economy was so strong. And you can see that here. And by the way, it hasn't been this strong in the 2000s. We've never really gotten back to this type of economy. You know, since since, you know, 2009.
SPEAKER_05: Is that because of the economic boom of the PC and internet errors? What would we attribute it to? The technology boom has a huge impact. But let me just
SPEAKER_00: describe what started it. Okay. What's what happened in 1981. Reagan's inaugural is president in January of 1981. He cuts the top marginal income tax rate from 70 to 50%. And I'd say equally important, you have Paul Volcker at the Fed, he breaks inflation, he jacks up interest rates causes a very severe recession in 1982. But it broke the back of hyperinflation. And we it ushered in decades of declining interest rates. You can see that on this chart here, interest rates have more or less been in the decline. Since Paul Volcker was at the Fed, what does this do? It made the the reduce the the the the risk rate of return, which leads to more investment in everything in everything, at least a more investment, it caused a rally in the bond market and the stock market. And by the way, no one
SPEAKER_02: remembers mod in a modern era, I'm sorry, sex, but like most interest rates for buying a home mortgage rates were over six and a half percent for most of the Yeah, it was 15. Most of the last couple of decades. Yeah. Yeah. Good. Good luck. Good luck buying a home in the 1970s.
SPEAKER_00: Right. Like, David, David, can you like, can you actually be intellectually
SPEAKER_04: honest and overlay aggregate actual GDP on this chart? Because what you'll see is it goes up into the right independent of all of this bullshit.
SPEAKER_00: No, that's not true. You can see that is absolutely true. And I'll just share my screen GDP
SPEAKER_05: growth rate versus no, this is simple. Forget growth rate. What is the actual
SPEAKER_04: number?
SPEAKER_05: Right, we're talking about the real number, not the percentage growth because I was actually about to ask the real number. This is great. I know.
SPEAKER_03: The change in GDP. I know. I'm talking about grade two mathematics here, guys, the absolute number,
SPEAKER_05: the absolute number keeps going up into the right because No, it doesn't that these these these dots that are below zero
SPEAKER_00: or session, right? But those are changes from the year before. So when you're
SPEAKER_04: compounding naturally,
SPEAKER_00: no, the green and red bars at the very bottom are changes from the year before. But these are absolute percentage changes in GDP. I know. So recession, a recession is defined as two quarters of negative growth. So GDP can go down. David, David, can I just show you the aggregate GDP growth
SPEAKER_04: from 1960 to 2000. And you can just look at this and tell me what's what what is wrong with the trading economics website that that everybody else would use?
SPEAKER_05: Yeah, pull it up. I mean, I think one of the things that I have as a question for everybody is, is there a is there a major difference between 2% two and a half percent 3% growth in terms of how we all experience our lives? And what are we optimizing? Therefore? Are we optimizing for consistency? Or we opt in? You know, no recessions? Well, this is what's
SPEAKER_04: interesting. So do you see this chart right here? It's perfectly
SPEAKER_05: consistent with the exception of the aggregate GDP. Okay, it
SPEAKER_04: started off at less than a trillion in 1950 something. It was about, you know, a trillion dollars at 1968. And it's about $23 trillion now. This is the aggregate of what has happened in the American economy over the last 70 years. compounding
SPEAKER_05: interest is an amazing thing. Now, exactly right. Now, this
SPEAKER_04: has happened in democratic presidencies, Republican presidencies, when rates were at 16%, when rates were at 0%. So all I'm saying is we have a natural tendency and inertia to move forward, the rate of change, we can debate. And obviously, it is ebbed and flowed over years. But the fact that it's towards moving forward and downhill with increasing momentum is undeniable. And so again, I would ask, when we think about the fact that the natural tendency is that the next five or 10 year period in aggregate will become bigger and better, there'll be more of the pie to share. Why is inflation a bad thing? Because all it does is depress financial assets, it drives up earnings and income, which drives up consumption of the lower three or four quartiles of the lower three quartiles of the earnings population. I just don't see why it's such a bad thing.
SPEAKER_00: I think I think mild, mild inflation, you know, in the two to 4% range is is fine. And it's probably better. It's certainly better, I would say than two to 4% deflation. But when you start to get runaway inflation, like we did in the 1970s, it massively increases interest rates. And that makes it harder for people to buy houses and borrow money and invest money because now the risk free return is higher. And that only applies. I know, but that only applies to the top quartile of
SPEAKER_04: the population, the bottom three quartiles don't give a shit about what you just said, because they don't do it.
SPEAKER_00: I don't think people want to have to spend $600 on a loaf of bread. You know, that's it. Look, you look at Venezuela, you look at weimar, Germany, you do not want inflation to get out of control. And it can spiral out of control. Because once people start to expect is that realistic, though, that it will spiral out of control given technological advances,
SPEAKER_05: efficiency. I mean, what you backdrop that you are, you are bringing up, I think the really brilliant point, which is could
SPEAKER_04: it really even happen today? Because if you think about where we allocate our time and attention and consumption, half of it, by definition, are things that are just so naturally deflationary. We're all you know, we're on YouTube, you know, Facebook, TikTok, all the time, those are naturally deflationary sinks of time and energy and effort and money. Right. So to date, to Jerry, to Jason's point, like, I think that that's actually true. I don't think that it's even possible to actually have hyperinflation anymore. Where do we have hyperinflation, NFTs, Bitcoin, equities, and
SPEAKER_05: financial assets, financial and homes? Right? I mean, and that's
SPEAKER_04: a highly regulated and I guess healthcare and educate higher
SPEAKER_05: education, those but pretty much anything that the government's involved in, basically, what the government's not involved in
SPEAKER_05: NFTs and Bitcoin, those are the anti government portfolio. But, but by the way, healthcare inflation really started in
SPEAKER_04: Obama because of Obamacare. Yeah, anything like that? The government's involved in inflates?
SPEAKER_00: Yeah, because if the government's paying the bill, why would you raise prices? There's no competitive market, there's one customer charge
SPEAKER_02: whatever you want, etc. So to be clear, I inflation is not my number one concern right
SPEAKER_00: now. I'm just saying that it would not be a good thing to let it get out of control. That's all. But it's not it's not the biggest concern my list. Your main concern is dunking on Chamath for that tweet storm.
SPEAKER_05: No, no, I'm not dunking on him. I'm he dunked on me saying that
SPEAKER_00: you know, basically turned into a bunch of 15 year old girls who said
SPEAKER_05: something and got misinterpreted on social media. And now we have to work it out. And you the audience are the beneficiaries. No, I'll tell you, I'll tell you my my main concern is this idea
SPEAKER_00: that economic booms are not a good thing. Because you know, God forbid the people at the top might get richer. That's the problem. It to that then. Yeah, I don't know if you guys have been following what's happening with the head of operations at
SPEAKER_05: work. I guess he's the head of warehouses at Amazon. Amazon is standing up to Elizabeth Warren on Twitter. They're mixing it up. Did you guys see these tweets? Let's pull them? Oh, what is cool? What? You haven't seen these? No. Chamath didn't you donate like some ridiculous amount of money
SPEAKER_02: to Elizabeth Warren's campaign? No, 25k just tasty poo. It was a little teaser bet. It was
SPEAKER_04: a little teaser bet. And I and I didn't like what I saw. So I had to shut it down. I shut it down on the turn. The flop was like, the flop flop.
SPEAKER_01: You lived in you lived in with seven, four.
SPEAKER_04: I lived in with seven, four offsuit. I put a little teaser bet out there. I didn't like what I saw. And so I folded. Basically, Amazon is finally saying, Hey, we're just gonna
SPEAKER_05: we're gonna stand up when Elizabeth Warren or Bernie Sanders kind of attack us and attack Bezos. And they just said, Listen, you guys set the minimum wage, do your job, we moved the minimum wage at Amazon to $15 an hour, we made our decision, get back to work and set the federal minimum wage of $15 an hour and stop telling us we don't pay our taxes because you make the tax law. So essentially, this dovetails with the hearing. I don't know if you guys watched any of the hearing with Zuckerberg and everybody. But basically, they were seems like big tech is just putting their foot down and saying, just tell us what you want us to do, because we're doing it. We're giving people what Zuckerberg and Dorsey basically said is
SPEAKER_00: that if you don't like that kind of speech, then why don't you prohibit it instead of telling us to do it? You can't and you won't because you know, it's it's it's a violation of the First Amendment. So that yeah, they were kind of pushing back on them saying, Listen, if you have such a problem with it, pass a law. Yeah. And this guy, Dave Clark, you guys know Dave
SPEAKER_05: Clark at Amazon? Nope. So this is the guy who's been mixing it
SPEAKER_05: up. And if the audience is listening, you can see a bunch of this on the YouTube channel because we will put it Oh, wow. He's he's like the number two guy there. He runs all he runs
SPEAKER_04: the entire retail business, I guess. Yeah. So now, Amazon is
SPEAKER_05: on a full court press to engage with, let's call it the socialist left. I guess they call themselves democratic socialists, because they don't want to be called socialists. And they're saying like, Listen, we give people health care, we give them 15 bucks an hour. And if you want to tour the facilities, tour the Philly, but nobody is peeing in bottles. And then of course, the press and a couple of people showed bottles with pee in them, that drivers can't stop to even go to the bathroom, which I think is a tragedy and horrible. People should not have to pee in bottles. I mean, they asked me about on CNBC today. I was like, are you this is a serious question. Like, of course, nobody should be peeing in bottles. But if you look at this exchange, I think we're kind of hitting the end of this debate, which is everybody kind of agrees we should have health care for everybody in the country, we should have a $15 minimum wage. Why are we dunking and fighting with each other? When we've got this adversary, which is, or two adversaries with Russia and China, we have these two crazy adversaries who want to build authoritarian countries and control the economy and eventually control the planet. Why is where Americans fighting with each other over these issues? I mean, this is this is just incredible.
SPEAKER_04: I just want to read it. Bernie Sanders says, I look forward to meeting with Amazon workers in Alabama on Friday. All I want to know is why the richest man in the world Jeff Bezos is spending millions trying to prevent workers from organizing union so they can negotiate for better wages, benefits and working conditions. To which he replies, all we want to know is why the senator is one of the most powerful politicians in Vermont for 30 plus years and their minimum wage is still only $11.75. Amazon's minimum wage is $15 plus great health care from day one. The senator should save his finger wagging lecture until after he actually delivers in his own backyard. To your point, it is getting to a point now where folks are like, all right, guys, so step up and change the laws and change the incentives. And I think that that's going to be really important. Saxie, you had something that you you were really miffed by what Zuck said or something at the thing. Oh, well, well, I what Zuck was trying to do in that hearing,
SPEAKER_00: the surteccary guy, what's his name? Ben Thompson? Thompson? Strategery? I think it's Stratechery. No, no, no, no, it's
SPEAKER_04: Stratechery. No, he literally said it. He came to the poker
SPEAKER_05: game that we do at the D conference, or the RICO conference, whatever it's called co conference. And he said, it's Stratechery. Right? It's right. It's the worst name that was ever created. Stratechery. Anyway, 100 bucks a year. He's got like 10,000 people paying for it. It's crazy. What what makes the way he. Okay, great. So the way thank you for that.
SPEAKER_00: Thank you for that clarification. What what Ben Thompson wrote the way he described Zuck statement is that Zuck was pulling up the ladder on all the other social networking sites that might come afterwards. And it was, look, it was one of those tactical maneuvers that's in Facebook sort of narrow self interest. But it's so obvious that he's so obviously in their self interest that, you know, people slam them for that. It's just too Machiavellian. And basically what Zuckerberg said is, listen, we now have over 30,000 people doing content moderation, you guys should check you the lawmakers should change section 230. To say that, you know, you the social media sites only get section 230 protection the liability shield, if you engage in this kind of content moderation. But if you're a site that doesn't, then you don't get section. Well, what's what Zuckerberg trying to do? You know, small startups can't hire 30,000 people to do content moderation. So this is like classic regulatory capture, but done brazenly in the open at a congressional hearing.
SPEAKER_04: I think you're right. I think it kind of makes a lot of sense from him. It's the game theory is pretty obvious, which is like, okay, make it now impossible for anybody to compete with us. And you basically lock us in forever, which it's pretty, pretty brilliant. The question is, what do you think the odds are that politicians fall for this? I think they're forcing their hand now. So they don't have choice.
SPEAKER_00: Yeah, well, I mean, the Democrats on that committee have basically been saying that disinformation is a huge problem. And you the social media sites need to correct it, you need to control it. And so Zuckerberg comes along and says, Okay, great, no problem. We've hired 30,000 content moderators, we're going to do what you said. In fact, we're going to hire more. And by the way, if you really want to get tough about this, why don't you modify section 230 to require it? Well, how many other startups can ever hire that number of content moderators? This is creating a moat that will basically protect zuck and Facebook forever. Right capture. Yep. And the other
SPEAKER_05: crazy thing in this was the this stupid format they come up with where they give each person who's you know, a senator or congressman or congressperson who's doing the questioning, they give them five minutes. So they're like, I only want a yes no answer. And you're like, I'm going to ask you the most challenging problem in the world. I need you to answer yes or no binary one or zero. And it's like, well, that's not kind of how a nuanced issue works. Like section 230. This is going to take some time. Can I get one minute to answer the question two minutes to answer the question. And so jack and Zuckerberg and everybody just kind of threw their hands up. They're like, I can't answer this in a yes. No. Can you ask me give me 30 seconds to answer these questions. It was pretty ridiculous. And then they were trying to get them all to say that their platforms were used for the January 6 insurgency. And I don't agree with Zuck on much but he was like, No, I think the people who were involved in January 6 were responsible for it. So whether that's the president or the people who broke into the Capitol, they're the ones who are actually responsible for this. You guys didn't? Yes. So
SPEAKER_00: no, I Well, I read I read some summaries of it. And I think Dorsey actually did a did a great job. And I like I liked his performance. And let me read you a quote. Mike Solana tweeted this. So he said, jack said, I don't think these decisions should be made by private companies or the government, which is why we're suggesting a protocol approach to help the people make the decisions themselves. That was jack Dorsey. Now, that almost sounds like me, if he just changed the word protocol to First Amendment case law. So I don't want these companies or the Senate Judiciary Committee, you know, censoring people, I want to use a revered external standard, which is the First Amendment case law that's been developed over the last two centuries. So jack wants to use a protocol, okay, but fine. But he's on the right track here, which is he's saying, look, we don't want to be in the business of having this power to decide who's going to have access to, you know, to the town square. And that's a step in the right direction.
SPEAKER_05: He's also got a project there to turn social networks into open standards. So in other words, the way we can all anybody can make an email client, because email is an open standard, anybody can build a web page or a browser, because HTML is an open standard, he wants to do that. And he's working on that inside of Twitter, where anybody is going to be able to take their tweets, and they're going to be decentralized. There's going to be no central server, and you're going to be able to bring your own algorithm. So if you feel the algorithm is causing you to see extreme views, you can say I want mine to only lean towards, I want this one that leads towards positivity and kindness, right? And somebody can make a third party, there's an algorithm that gets rid of jerks.
SPEAKER_04: You guys probably saw this week, but a deal was announced and investment was announced. And recent Sequoia, myself and a few others, we did this thing called bit clout. I heard about this.
SPEAKER_05: Yeah. So what is it just to give you a sense of it? It's like,
SPEAKER_04: I've been hearing about it separately from a bunch of
SPEAKER_02: people. Yeah. So I mean, like the in a nutshell, you know,
SPEAKER_04: what these guys did was they said, Okay, well, you know, we're just going to take, you know, this entire blockchain concept, and we're going to fork it. And we're going to create this thing where folks can essentially have one blockchain, they can, you know, have content around it, and then identify sort of people and nodes. And all of a sudden, like we all have this currency that sits on top of this bit cloud currency. And why that's interesting is their first app that they built on top of this was basically a kind of a clone of Twitter, just kind of as a proof of concept app. And I think, Jason, it's moving to a place where now, people with reputation and people with trust can actually signal that they have it. And then that's a probably a better way over time, for folks like us to figure out what is valuable and not valuable, what is trustworthy or not, irrespective of whichever end of the spectrum it's coming in off of. And then, if there is disinformation, you know, that person's quote unquote, bit cloud stock, right, that their token will fall in value. There'll probably be a lot of interesting apps that are built on top of this, I was really drawn to the general idea of the project. And I think that's what Andreessen and Sequoia probably felt as well. So you know, there are these interesting solutions, there's bit cloud, there's Jason, what you said, this open source project at Twitter, it's all it's all going to be really interesting. But I think if we can get to a way where we can quantify reputation and trust, that's the another way of around working around the pulling up the ladder effect of what Facebook and Twitter effectively told Congress this week. I want to talk to you guys about what the hell what the hell is going on in the Suez Canal? And what does this mean? I mean, Freiburg, what the fuck is this? This is unbelievable.
SPEAKER_02: You know, it's so random, and unfortunate, but this, this ship that weighs 200,000 metric tons, that's taller, it's longer than the Empire State Building is tall, going through the Suez Canal, which I think, you know, there's about 100 ships a day go through the Suez Canal. And it's, you know, the Suez Canal, really is, you know, kind of an amazing engineering accomplishment that connects the Mediterranean Sea to the Red Sea, it basically allows ships from Asia to not have to go all the way around Africa to get to Europe. And the ship goes into the Suez Canal, and it had a blackout, its power went out. And so it just kept cruising without being able to control the steering because there's like friggin power steering on these massive ships. Like, they don't have like a wire connected to the rudder. And so, you know, the thing what no backup battery
SPEAKER_05: supply, I guess it was, no one knows, but like the power went
SPEAKER_02: out and the total blackout on the ship. They couldn't get the power back on and the thing just keeps cruising and cruising and cruising. And it cruises right into the side, which is this big sand barrier on either side of the Suez Canal. And it gets lodged in the sand barrier on the side. Now when you have 200 thousand metric tons moving at a few miles an hour, that's an incredible amount of momentum of energy. And so when it lodges in the side, that's, you know, it's lodged in there. Math times acceleration. Yeah, it's actually math times velocity. But yeah, you're close. And so the thing just basically got lodged in there, and they can't get it out. And now they think it's going to take another week or two before they'll be able to kind of dig all around the sand and tugboat the thing out of there. But I think what's interesting, so 10% of global trade moved through the Suez Canal, and about 100 of these massive ships a day, you know, move through this canal. But it really highlights the
SPEAKER_02: fragility of our global supply chain, similar to kind of the experience I think we had during the COVID pandemic, when all of a sudden things like toilet paper were less available to us. But you know, a small power outage on a boat on a ship, you know, in the middle of the Suez Canal can suddenly block up so much of global trade and cause, you know, massive fluctuations in commodity prices and availability of supplies and products for businesses around the world, there's going to be rippling economic effects for a period of time, it's unclear how significant they're going to be. But you know, I really do think that taking note of the fragility of our supply chain in this particular context, it's worth taking a step back. And, you know, I spent a lot of my personal work time, obviously, off the podcast, thinking about kind of our systems of industry. And, you know, the global industrial revolutions were really predicated on this notion of centralization. You know, we took a lot of our production systems, and we centralized them and created automated, repeatable tasks. And that reduced the cost and allowed us per unit of production, to basically make things much more affordably. But the problem with centralization, generally speaking, and supply chains is exactly this, which is you you have a supply chain that is much more delicate. And it is much more I mean, think about the difference in power, right? If the power goes out at a power plant, all the homes that are connected to it lose power, versus if every home had their own power generator or solar cells, they could continue to support themselves. And in a similar context, so much and this goes back to our conversation earlier about globalization. So much of our global supply chain for industry has become centralized by finding the lowest cost possible, but it loses all of its durability. And so the 21st century, and especially leading into this infrastructure bill that we're going to be talking about, or that's going to be talked about for a long time now, for months to come, presents an opportunity for us to think about durability in industry and durability and supply chains that I think is really profound, and allows us to shift the balance of power, but also shift the set of the sources of production of all the things we consume as a species in a much more distributed way. And that can be done using green technology using, you know, 3d printers using bio manufacturing, you know, using solar, there's a lot of vertical farming, vertical, yeah, whatever. I'll disagree with you on that one. And we'll talk about that separately. But I would argue like so much of industry has been centralized. Because remember, when the Industrial Revolution took hold, the only skill set we had as a species was mechanical engineering. And in the years that followed, we developed skills in chemical engineering, and ultimately in software and hardware engineering, and now more recently in biochemical engineering, where we can use biological systems to make stuff. And the advent of those technology capabilities, I think really gives us the opportunity today to reinvent the supply chains. And so the Suez Canal, I hope is a little bit of a wake up call, and I hope leads into some of the thinking around the infrastructure build proposals, where we're about building durability in the supply chain, and in that process, by the way, creating manufacturing jobs, you know, in a more distributed way.
SPEAKER_04: Let me build on what you're saying. So for all the people listening that really, really care about electrification and electric cars, and there's a bunch of Tesla bulls here, you know, Tesla uses a specific kind of battery called NCA. And there's, you know, other forms of batteries, but for the most part, and Tesla in China uses this LFP chemistry, but the point is, there's a lot of very, very valuable nickel that goes into making lithium ion batteries. And so if you believe in electrification, and you believe in, you know, zero emissions, and you believe in using these batteries, you need to believe in nickel, which is a tough business, okay, you're grabbing, you know, rock out of the ground, and you're leaching this, this extremely important metal out of it. So just a little while ago, there is a huge nickel manufacturer called Norlisk Nickel, right. And they have these two Russian nickel mines. And just very recently, they flooded. And the plug, which had been erected for localizing the flooding was washed away, not for the first time, not for the second time, but for the third time. And people now think that getting all this water out of the mine may take at least a year. Okay, so what, why should we care? Well, right now, if you think about all the batteries that were forecasted to make in order to sort of eliminate climate change, and, you know, do all these good things, and for, you know, Tesla to make their, you know, beautiful cars or whomever that, you know, they need nickel. And right now we have we have a deficit of nickel that's going to emerge now in less than a year. And we have, we have about a 37 to 40% shortage of what we need. So it's like you have all these grandiose visions of how the world should work. And an electric failure in a barge shuts down the global supply chain for weeks, a flood in a nickel mine is going to cause the price of a Tesla to basically double. And shouldn't people at some point, ask ourselves, is this really what efficiency is supposed to feel like on the ground? And it may not be right. And so maybe again, going back to the first conversation, a little bit more inefficiency, a little bit more inflation, a little bit more redundancy will allow us to be resilient. And maybe that's what we really want.
SPEAKER_05: You could ask the people in Texas what they want after they lost their power, and they have one light snowstorm and the whole city is destroyed. And I mean, there really is, there is
SPEAKER_05: something to having the redundancy in your home and the supply chain and obviously drugs, which we witnessed during the pandemic. Right, right. I mean, we infrastructure we were so we were so concerned about short
SPEAKER_00: term profit maximization that we off short our entire pharmaceutical production, and PPE manufacturing to China, which then said that they might ration it to us based on, you know, geopolitical concerns. No, thank you. So yeah, that that that is that is that is Pennywise and pound foolish, the absolute definition is the is the infrastructure bill going to
SPEAKER_04: fix it? freeburg, you have a rundown of the infrastructure bill, you know, there isn't a good there isn't good clarity on
SPEAKER_02: this, my concern is that there's going to be lots of push for things like roads and, you know, stuff that doesn't create ongoing jobs that so much money is going to go into basically a disguised stimulus package, versus, you know, the ideal kind of infrastructure program set is to enable industry. So if you go back and you think about like the Manhattan Project, and the Apollo mission, you know, those were very expensive government programs that have a very specific mandate. But because there were big investments and difficult problems, they unlocked a lot of industry that followed that initial development cycle. And I think that that is kind of a good guideline for us to think about with respect to what we might hope for an infrastructure bill to do, which is to create unlock for industry, as opposed to plowing money into short term service contracts with a bunch of guys who are going to make a ton of money building roads, and it doesn't really change the industry very much. And so I'm concerned it's going to be a giveaway of money that's going to create a short term stimulus, but doesn't really create long term effects in the industry. But we'll see what kind of comes out as they get more clarity on this. There's certainly a big push for quote, unquote, green, but I'm not sure the people that are quote, unquote, green advisors in this in this context, are going to be thinking about this, you know, this next century of opportunity, you know? Yeah, so so we'll see. America is going to have to have a real come to Jesus if they
SPEAKER_04: actually really give a shit about climate change. I'll give you I'll give you a different example. Like, again, to really electrify, you have to pull metals out of the ground. That is a dirty business. Okay. And there are impacts to the environment, even if you're the best at it. And right now in the Western Hemisphere, it takes 20 years to greenlight a mine 20 years. Our shortages start in the next year. In China, they have, you know, no issues whatsoever, right? Let's just say so maybe it takes them seven to 10 years to get to get a project greenlit. Now, I'm not advocating that we become China. But I think that it's really important for us to realize that like, you know, if we're going to really take this seriously, you can't have progress being hijacked by things that may not matter as much in the grand scheme of things like there is the opportunity, for example, to build a massive set of copper and nickel mines in the Western Hemisphere. But the minute that they get greenlit, they get there's an injunction that's filed by an NGO that'll say, Oh, you know, we have to think about the land grouse. And it's like, what the fuck is the land grouse? And at some point, you have to figure out whether you actually want your kids to have asthma or not, and whether they can suck up, you know, pm 2.5 and pm 10 for the rest of their lives, or you care more about the land grouse. And this is going to come come to a head. And hopefully the infrastructure bill paves the way for these decisions, because I think as a country, we're going to have to decide because many other countries in order to have clean air and drinkable water are going to basically prioritize humans over the land grouse.
SPEAKER_05: Yeah, I mean, it reminds me of the nuclear discussion we had earlier in this podcast of like, we can't even put a new nuclear power plant in this country without it taking decades and
SPEAKER_04: any any any interesting updates on the business side I saw is Microsoft really about to buy discord for $10 billion? Yeah,
SPEAKER_05: if you look at that compared to, you know, the slack acquisition is slack up what for 28 billion with was it 800 million in revenue yearly revenue at the time, and discord has 150 million and they're going to pretend it's unbelievable. It's it's an even higher multiple for the time sale for 1.2 billion at
SPEAKER_02: this point. Holy Well, it was it was in hindsight, it was probably
SPEAKER_00: cheap. It made the market. Yeah, yeah. Yeah. Well, I mean, back in 2012, we we really thought back in 2012, that one to 2 billion was like, the best case scenario of Yeah, the upper bound of what a SAS exit would look like. We just never realized how big the market could get. And now obviously, you have slack at close to 30 billion, you have DocuSign, IPO, 40 billion, you have zoom at over 100 billion. And so the markets just ended up so much bigger than we ever thought. And we were the optimists, we were the ones building companies in SAS back then. And so the cloud has just been so I mean, and you see this now with you know, the numbers that Azure and Google Cloud, and AWS keep reporting where they're at like 10s of billions of revenue, and they're still growing like 40 50% a year. So the cloud is so much bigger than what we all thought and what came before. So that's what I mean. So I've just decided to stop trying to find new ideas and just I mean, you see, like a new thesis, and just keep investing in this. That's why I'm kind of all in on on SAS right now.
SPEAKER_05: Do you think Microsoft is doing this to compete with slack or they're doing it to just really take over gaming? You have any insights? I think probably it's probably an element of both where they do
SPEAKER_00: like one of their few consumer business lines that's done really well as Xbox and gaming and they bought Minecraft. And so I think they can get some value out of it there. But I have to believe that this is competitively driven. They gotta be worried about slack. I mean, the crown jewel at Microsoft is the office suite. The reason they bought Yammer is to accelerate the transition of office into cloud social and mobile. And it didn't help do that. And they got to be worried about Salesforce now buying slack. I mean, that is Benioff has been wanting to go after office for a long time. And this is his way to do it.
SPEAKER_05: Yeah. All right. There you have it, folks. Another all in podcast is in the can. Let me just ask a question. Are people making summer plans and fall plans based on the I'm making I'm making I'm making tonight plans. I can't
SPEAKER_04: wait to get you victims into the poker room. I want you to fly in. Come and play. We need a full bestie victim. Well, sex what's your plan tonight? Like are you going to some fancy like
SPEAKER_02: pasta restaurant with your wife? You're popping bottles with? Yeah. Yeah. Who are you hanging out with tonight? What are you doing? Yeah, what are you doing these with the kids? It was
SPEAKER_00: Friday night. Do you know their names? Yeah. Put them to bed. Do you have put them to bed? Fly up? No days. Come to the poker
SPEAKER_02: game. Tell us your kids middle names.
SPEAKER_03: Actually, that's a good one.
SPEAKER_06: Whatever job. Who knows? I went to the movies last night. I was
SPEAKER_05: I took my 11 year old out. She was she was. She wanted to get Shake Shack. So I took her to Shake Shack and the movie theater was there and it was open. And I was like, Oh, let's go check it out of what's going on at the movie theater. And Terminator two is playing 15 minutes later. Great film. Incredible film
SPEAKER_05: holds up and amazing to see on the big screen. We walk in I kid you not, you know, 100 seat theater with these beautiful big chairs. Nobody there. And they were so sorry, did you rent the
SPEAKER_04: whole thing? No, it just happens to be that they're open for
SPEAKER_05: business. They space people out. And it was $5 a ticket to see. I'm taking my I'm taking my daughters to the movies this
SPEAKER_02: afternoon. First time they've ever been to the movies. They're you know, three and a half and two. I am so excited to take them to a movie theater. So we rented the whole theater for $99 the best deal in town. What what movie are you seeing? trolls,
SPEAKER_02: you can choose a movie. That's the cool thing. There's like a list of like 50 films and you can pick a film. So I got like a little kids film for them. And they get to go see a movie theater and have popcorn have the experience and awesome. And
SPEAKER_04: you can have other friends there. Yeah, you can have up to
SPEAKER_02: 20 people. So you read the whole theater for 99 bucks and you you can kind of if you want to come see trolls chum up just cruise off. I'll send you a ticket. Oh my god. That's the coolest
SPEAKER_04: fucking thing. That's all versus Kong is happening and I'm renting a
SPEAKER_05: theater for it. So if everybody wants to bring their kids, it's a great kids would never sleep after saying that it's no, no,
SPEAKER_02: it's not for three to five year olds, but you know, 10 year olds
SPEAKER_05: Yes. It's 100 bucks. This is an AMC theater. 99 bucks. It's
SPEAKER_04: awesome. AMC. Yeah. But the the synopolis I think charges 200
SPEAKER_05: and that's the like really high end theater where you can press a button and the waiter comes and the waiter was like, thanks for coming. We really appreciate it. Like you're one of the first guests. No way there is no way it was kind of like an emotional moment for me to take my daughter again, because that's what we would do every Friday. Yeah, you know, school. There's no way movie theaters go out of business. I mean, they're just
SPEAKER_02: it's such like, like a traditional experience. It's so American. It's just what AMC is trading at. Hmm. AMC would be an
SPEAKER_03: interest. I just had to say this conversation out. He's like, I
SPEAKER_01: got my movie theater downstairs. The Usher is on standby. Ready to let me in. How many seats are you? It's like, Oh, you can only
SPEAKER_05: rent a 20 seat theater. I have a 40 seat theater. How many
SPEAKER_01: theaters are do you have built in your various homes?
SPEAKER_01: You only have one theater per home? Sax is it one theater per
SPEAKER_05: home? No, he's got a multiplex in each case. People want to watch different movies. They meet at
SPEAKER_06: the popcorn stand. I'm excited to go back to the movies. I
SPEAKER_00: mean, I love going to movies. I love how excited are you guys to
SPEAKER_02: go to Disneyland? I want to take my kids to Disney. I can't wait.
SPEAKER_04: I can't. COVID is over. I'm so sick. By the way, how right how right were
SPEAKER_00: we? I think it was like two or three pods ago. We were saying that COVID be over by Memorial Day, Memorial Day, and even in
SPEAKER_04: California, Gavin Newsom, basically has finally capitulated to logic and everybody can get a shot now as of April 15. Yeah, which means by May 15, everybody who wants to get vaccinated, recall 2.2 million.
SPEAKER_00: Recall and shame and shaming him and berating him on Twitter constantly. I mean, Peter fam was tweeting out like every day the growing inventories of vaccine and all the open appointments we all were and it's like ridiculous. We kept that mentioning him 5 million shots on shelves in a pandemic.
SPEAKER_05: I mean, you don't need to be freeberg to understand how vaccines work. Each person's a blocker, right? Yeah. And the
SPEAKER_00: other thing the other thing that got Newsom to move was that Biden gave that press conference in which he moved up the date. And so then that prompted Newsom to move up his date. And the same thing happened like a month ago, when when Biden gave that that speech, where he said he gave that May 1 date as a date everyone should get vaccinated. So frankly, it'd be nice if we had a governor who would just do the right thing without the constant threat of recall and tweet shaming and, you know, and the president dragging him, you know, into the future. But, but I guess we do with all I'm curious what you guys think of
SPEAKER_05: what we should do with all this extra supply. I had an interesting idea for the economy. If you come to America and you've tested that you don't have COVID, right, you take a test on the free get there. If you come to America, we will give you the vaccine at the airport. Jason, I think here's
SPEAKER_02: what we're gonna do from now on. How great would that be? You're gonna have you're gonna have three little chips a week and you get to put a chip in a jar and then you can suggest one of your ideas. But then once you hit the review, we're done.
SPEAKER_06: Yeah. vaccine tourism.
SPEAKER_05: Like formalized vaccine tours. If you come to America for vacation, complimentary vaccines on the way in. I mean, we're
SPEAKER_00: already at the point. Look, effectively affected. No, I think effectively, we're going to have that it won't be at the airport. But I mean, the all the restrictions are coming off in every state by mid April now. People can't afford an international plane ticket. You
SPEAKER_02: know, they're not like going to come to the US to get a shot. I
SPEAKER_04: would like to advocate that we take these extra vaccines and we ship them to the developing world. Yeah, they should go
SPEAKER_02: south of the border for sure. For sure. Yeah. And by the way,
SPEAKER_00: we're doing a much better job vaccinating people than Europe. I mean, it's unbelievable that COVID is spiking in Europe right now because they've been so incompetent at getting people vaccinated. Well, their issue was they do order ins, shockingly
SPEAKER_04: incompetent, shock Canadians and the Europeans said we want you
SPEAKER_05: to prove to us the vaccine works. Before we put our order in. I don't do that, Jason. I think I think Jason like I think
SPEAKER_04: that like sometimes I think over the last 40 years, there's been two polar opposites of governing people. One is what I would call the autocrat. And the other is what I would call kindergarten soccer, where when the ball no matter where the ball is on the on the soccer field, every player on every team is surrounded. And so as a result, no progress is here. Progress is bursty and unpredictable and sometimes not great, but it can happen. And this is where like, you know, so like, I mean, we are I'm still shocked at the lack of scientific rigor and understanding by these people. And so how could you have an entire western set of countries who are theoretically not stupid? be in this situation in April of 2021? Knowing what we know?
SPEAKER_00: Yeah, well, how's how's Brexit? How's Brexit looking now? Because because Britain is like, it's almost fully vaccinated, their COVID numbers are coming way down. And then the British variant, the British variant, it started in the UK is spreading like wildfire across Europe, because they're too bureaucratic to get everyone vaccinated. So I mean, Britain is looking really good by comparison right now. And they opted out of kindergarten soccer.
SPEAKER_00: Yeah. And by the way, this is just to tie it back to the infrastructure for a second. I don't have a problem with infrastructure if the investments can be spent wisely. But how much of us trust the government to spend the money wisely as opposed to on pork barrel spending and wasteful projects and taking too long. We have the Bay Bridge in San Francisco, the original Bay Bridge took two years to build. And then the the repair of it took 17 years, where they did like the the upgraded version. And that's the problem we have is that nobody really trusts our government anymore to allocate this money wisely.
SPEAKER_05: Just to give people an idea doses administered per 100 people 39 well now 40 for the US and Israel 114. Obviously, there's two dough shots and Spain 14 Italy 14 Canada 12 Mexico for my mom who's almost 80 just got her first shot,
SPEAKER_04: which I think is inexcusable. Justin Trudeau, if you're listening, disaster. I just I just think that's unacceptable,
SPEAKER_04: unacceptable. She's 79 years old. It's unacceptable. God, I mean, it literally is these politicians, these
SPEAKER_05: politicians and bureaucrats designed this complicated system
SPEAKER_00: to prove that they're helping people just like new score equity points. It's just all they do is get away equity. That's what they do. The red the red light should go off and you
SPEAKER_04: should run far away from whatever comes after we're going to solve an equity problem. We see efficiency. Let's let's go.
SPEAKER_05: Yeah. All right, everybody. We'll see you all next time on the all in podcast. Love you guys. Love you best. See you tonight. See you tonight. See you tonight.
SPEAKER_05: Someone bring us some of that sax crafty poo money. Come on. Yeah. Come on. We will play plo. We'll keep it to hold them. Yeah, we know you fly up. You fly up for the evening, you're going to
SPEAKER_02: be just fully committed. You know, you're gonna be playing right. Yeah, you're right. I'll come in tilted because I'm
SPEAKER_00: negative. Jet fuel. Yes. Coin twice. How about if we cover it?
SPEAKER_04: We'll just do a flip and we'll cover it. Cover your jet fuel.
SPEAKER_05: Boy, that's not a no. I didn't hear that. Somebody's low.
SPEAKER_06: Someone said text and tell her to kick him out of the house
SPEAKER_02: tonight. Rain Man David. We open source it to the fans and
SPEAKER_00: they've just gone crazy. We should all just get a room and
SPEAKER_03: just have one big huge because they're all just like this like this like sexual tension that we just need to release. You're a European. We need to get merges are back.
