SPEAKER_04: So live from an undisclosed location with the sultry filter on
SPEAKER_03: Very sultry filter on
SPEAKER_04: Having a great hair day. Yeah, that is a good hair day for you. Great hair day my pal And your favorite CEO and twitterer, mr. Elon Musk. How you doing pal?
SPEAKER_04: Appreciate you coming to the event and coming zooming in. Yeah, what's new in your world?
SPEAKER_00: Well, let's see, I guess right now I'm sort of debating the number of bots on Twitter On Twitter and Currently I'd like the what I'm being told is that the there's just no way to know the number of bots It's like as unknowable as the human soul, basically
SPEAKER_00: Witchcraft and alchemy is needed to determine these percentage I said like why not try calling people but I haven't got a response, you know, like if you try calling people or something You know like maybe try to answer. It's not about no, no, no
SPEAKER_00: I don't know but I think like that would be one of the things to do to say like Have you tried calling them as opposed to trying to read the tea leaves here? That's like impossible, you know Obviously you can have an account that looks exactly like a human account or is being operated where one person is operating a thousand accounts or something But that person can only buy one toaster They're not gonna buy a thousand toasters So you care about like number of unique real people that are on the system it's extremely fundamental and anyone who uses Twitter is well aware that the comment threads are full of spam, scam and Just a lot of you know fake accounts. So it seems Beyond reasonable for Twitter to claim that the number of Essentially the number of real, you said another way, the number of real unique humans That you see making comments on a daily basis on Twitter is above 95% That is what they're claiming. Does anyone have that experience? I mean
SPEAKER_00: Really? Really?
SPEAKER_03: There's a bridge I'd like to sell you, you know
SPEAKER_00: And also you can buy the Brooklyn Bridge
SPEAKER_04: What do you think it is? What do you get? What's the, I mean, and it's not 5% What is it?
SPEAKER_02: I think it's some number that is probably at least four or five times that number
SPEAKER_00: I'd say at, if you did sort of the The lowest estimate would be probably 20% And this is a bunch of Quite smart outside firms have done analysis of Twitter and looked at the sort of daily users And their conclusion is also about 20% But that's a lower bound. It's not an upper bound If you look at say the most liked tweets on Twitter So I have the honor of having the most liked tweet of any living human This is Thank you everyone for liking my tweet Including you all, some of the bots out there But that tweet is less than 5 million likes It's like 4.7 or something like that And that was the, where I tweeted about that next time buying Coca Cola to put the cocaine back in Definitely, it's clearly something that the public really wants And you know, Coca Cola Corporation should really think about going back to their roots From O.E. Coca Cola I mean this, I guess, is the reason why our grandparents could sort of walk 20 miles in the snow Because they had Coca Cola with cocaine This is the real reason Anyway, that's literally the most popular tweet of any living human But Twitter says that the sort of monetizable daily active users is 217 million So why would it be that the most popular tweet ever basically is only 2, 2.5% of the entire user base This seems a very, very low number And the most popular tweets generally are clustered around that sort of 4 million like level So it's basically 2% or less than 2% of the daily active users And technically monetizable daily active users is how Twitter refers to it So it just seems, how is this possible? Surely there's something that maybe 10% of people would like, not merely 2% Well actually, if you think about it Elon, there's a corollary on YouTube
SPEAKER_04: What's the total user base of YouTube and what have the most popular videos gotten there? And I think there's a billion or two, maybe a billion people using YouTube And those, the most popular videos, have tens of billions of views That might be instructive
SPEAKER_00: Exactly. That ratio makes a lot more sense So something doesn't add up here And my concern is not that is it like, you know, is it 5 or 7 or 8% But is it potentially 80% or 90% bots I mean, I certainly know there's some real people on Twitter But what's, is it an order of magnitude? Is it 50% instead of 5? And that's obviously an incredibly material number Especially since Twitter relies primarily on brand advertising As opposed to specific click-through advertising where you make a purchase If you make a purchase, it doesn't really matter that much But for brand advertising, which is really just awareness advertising It matters if real humans are seeing that or not
SPEAKER_04: Yeah. And so, I guess stepping back for a second People are curious why you want to buy Twitter Why is this so important to you? And then, I guess, what are the chances you think the deal gets done at this point? So a two-parter, why is it so important to you?
SPEAKER_00: I mean, some of this I've articulated before But I think there's a need for a public town square, a digital town square Where people can debate issues of all kinds Including the most substantive issues And in order for that to be the case, you have to have something that is as broadly inclusive as possible That has as much of the people on the platform as possible Where it feels balanced from a political standpoint It's not biased one way or the other And where the system is transparent This is why I think it's important to put the algorithm on GitHub And actually allow the public to see it and critique it and improve it And if there are any manual changes Sort of shadow banning as it's called Or increasing or decreasing the prominence of a tweet That's done manually, that that should be noted So you know what has happened And it's not just, you know, you're just, where it is right now Where you don't know what the heck is going on Why is one tweet doing well? Why is another tweet not? Is it the algorithm? Did someone manually intervene? Why are some accounts banned? With no recourse apparently And you know, the reality is That Twitter at this point has a very far left bias And I would class myself as a moderate Neither Republican nor Democrat And in fact, I have voted overwhelmingly for Democrats historically Overwhelmingly Like I'm not sure, I might never have voted for a Republican Just to be clear Now this election I will
SPEAKER_04: David, you okay? David's not, he's faking
SPEAKER_03: Keep going, keep going, he's fine, he's fine We're going to resuscitate him, we're going to resuscitate David Sachs I mean, let me ask you a personal question
SPEAKER_00: The point I'm trying to make is that this is not some sort of attempt to You know, it's not some right wing takeover As say people in life may fear But rather a moderate wing takeover And an attempt to ensure that people of all political beliefs Feel welcome on a digital town square And they can express their beliefs Without fear of being banned or shadow banned And that we obviously need to get rid of the bots And scams and trolls and people that are operating Huge bot armies in an attempt to Unduly influence the public opinion So this is what, I think it's very important that we have that Like the, some of the smartest people in history have Thought about it and said like free speech is important For a healthy democracy it is important And free speech only matters Like say when does free speech matter most It's when someone, when it's someone you don't like Saying something you don't like That's when it actually matters So, you know, obviously And it's pretty annoying when someone you don't like says something you don't like That's bad but it's actually a good sign that you have free speech So, I mean I get trashed by the media all the time It's fine, I don't care Do it twice as much, I couldn't care less But it's indicative of the fact that even though I have a lot of resources I do not actually have the ability to stop the media from trashing me And that's actually a good thing Yeah, I have to ask with regard to this current administration
SPEAKER_04: I know how hard you work on the car company And then Biden, you know, you've been a lifelong Democrat You've donated to Obama and to everybody Probably never voted Republican And yet, and the same is true for Joe Rogan Joe Rogan is, you know, a Bernie Sanders supporter And that the Democratic Party has been openly hostile to Joe Rogan And Biden can't even say the word Tesla Or invite you to the White House when they do an EV summit I'm curious just on a very personal basis What does it feel like to have that experience where the party you supported Won't even say the name of your company or invite you there They should be celebrating the work you're doing Yeah, I mean it definitely feels like this is not right
SPEAKER_00: Like this is, the issue here is that there's just The Democratic Party is overly, overly controlled by the unions And by the trial lawyers, particularly the class action lawyers And generally if you'll see something that is not in the interest of the people On the Democrat side it's going to come because of the unions Which is just another form of monopoly And the trial lawyers That's where actions will be happening from the Democrat side They're not in the interest of the people And then to be fair on the Republican side If you say like, where is something like not ideal happening It's because of corporate evil and religious zealotry That's generally where the bad things will be coming from on the Republican side That are not representative of the people So in the case of Biden he is simply too much captured by the unions Which was not the case with Obama So in the case of Obama you could have, you know, he was quite reasonable And I think he took more of a view that, you know, obviously you need to take the concerns of the unions into account But there are bigger issues at stake And unfortunately Biden does not do that
SPEAKER_03: Elon, I have a Tesla question I read today, it's incredible, there was a Bloomberg article that said the following So the setup is this It said since you went public, Tesla is up 22,000% 11 quarters of sequential profitability So hitting on all cylinders But the public analyst We had cylinders That's a car joke, that's a combustor
SPEAKER_00: Firing, stepping on the gas pedal, firing on all cylinders People charged
SPEAKER_03: But analysts, when they put out their projections, okay It's one of the most enormous bans for any company in America The price targets for Tesla, despite all of this success Some have it at 200, some have it at 1600, it's all over the place You tweeted a couple months ago Tesla's not a company, it's like six companies inside of a company Like you've had to build this Yeah, maybe more Can you just explain to people all these companies inside the super company Just so folks have a sense of what had to be done to get here
SPEAKER_00: Okay, I mean this question requires thought And I'll probably be leaving out quite a few things But if you look at say what does a typical car company do What they do is they They assemble vehicles And they send them to dealers And they manage the supply chain They might make the engine Or typically will make the engine But most of the parts are made by suppliers And a lot of the actual technology development is done by suppliers And most of the vehicle software is done by suppliers So the actual amount of real work done by car companies What you think of sort of like a GM or Ford Is not actually that much So they don't do sales, they don't do service So in the case of Tesla for example We do our own sales and service We don't have dealerships Then Tesla also has by far the biggest network of superchargers Sort of the electric equivalent of gas stations So we've built an entire global supercharger network Which is still the most advanced and by far the best way to charge your car When traveling long distance or if you live in a city And don't have the ability to charge your car There's a street parking or an apartment So the whole supercharger network We developed the supercharger network We deployed it, I think we have I don't know, 15,000 superchargers globally You can travel anywhere in America right now with The Tesla supercharger network Then in terms of vertical integration We make the battery pack The power electronics, the drive unit We actually make, we're more integrated in the parts We actually make so much of the car internally We're vertically integrated Not necessarily because we think there's some religious reason to be vertically integrated But because the pace that we needed to move Was just much faster than the supply chain could move And to the degree that you inherit the legacy supply chain You inherit the legacy constraints Including the speed, cost and technology And then Tesla is as much a software company As it is a hardware company So the software that runs in Tesla operates the car Operates the screen Does the charging All of that stuff is developed by Tesla And so we have sort of a car, a Tesla OS in the car When you
SPEAKER_00: I could go on for a long time And then very importantly Tesla has built an autopilot AI team from scratch That is the best real world AI team on earth And if anyone else has got a better one I'd like to see it demonstrated in a car The full self-driving beta at this point Can very often take you with zero interventions Across the bay area from San Jose to Marin So through complex traffic It's really quite sophisticated And I'd invite anyone to join the beta Or look at the videos of those who are in the beta We've got like 100,000 people in the beta So it's not tiny And we'll be expanding that to probably millions of people Or a million, I don't know, on that order By the end of the year So it's You had this slide
SPEAKER_00: We also built a chip team Because there wasn't hardware that we could run The friggin' AI on We couldn't just fill the trunk with a whole bunch of GPUs And They would have taken a trunk full of GPUs That would have been very expensive And take a massive amount of power and cooling Just to be able to do what the Tesla designed Full self-driving computer can do And we started a chip team from scratch Designed it, it was the best in the world And still is the best in the world Several years later And we also then developed, we were designing a dojo supercomputer To be able to process the All the video that's coming in from billions of miles of data Because just sort of like the way that it's critical to compete with Google Because they have so much data And they have all these people doing searches all the time And humanity is training it The same is true of Tesla You really need billions of miles, ultimately tens of billions of miles of training data Combined with a sort of a vast training computer And then optimize inference hardware in the car And state-of-the-art AI and training and specialized software across the board To be able to achieve a full self-driving solution I just want
SPEAKER_03: When he opened Tesla Gigafactory, remember this six or seven years ago? I'll just tell the audience's story quickly, Elon He puts a slide up there and he says Guys, we're not actually building a factory We're building a machine that makes machines And he puts the layout of the factory And it looks like a chip And it was basically like how you would actually lay out a microchip If you were like a layout engineer It was the craziest thing I'd ever seen That was when I first got it You walk in and you see what's happening
SPEAKER_04: And you have an insurance company now You're doing insurance for Tesla owners And an Uber competitor And eventually a robo taxi Uber competitor, RIP
SPEAKER_00: Yeah, I mean, insurance is quite significant Now are you okay? I'm okay The car insurance thing is a bigger deal, it may seem A lot of people are paying 30-40% as much as their lease payment for the car in car insurance So the car insurance industry is incredibly inefficient Because they're just First of all, you've got so many middle entities You've got from the insurance agent all the way to The final sort of reinsurer There's like a half dozen companies each taking a cut And then it's all very statistical Even if you're a very good driver You could be like 20 years old and a great driver But it's all statistical So you either can't get insurance or it's extremely expensive But Tesla allows for real-time insurance Based on how you actually drive the car If you drive the car in a safer way You actually have lower insurance So ours is Insurance is based on how you actually drive Not how historically people that
SPEAKER_00: Fit your order of demographic have drive And then you can close the loop around your Insurance rate by simply driving better and looking at your score And lowering your insurance in real-time And people do, it actually promotes safer driving
SPEAKER_04: I actually have had this experience because In my household two people drive my car And one of them has a 93 score and the other one does not They have like a 60 score And you may have met this other person But I've been trying to work with her on the aggressive turns and stops In advance of our insurance bill Which we're hoping will go down at some point You didn't, oh the one question Is this Twitter deal going to get closed you think? What are the chances here? Well, I mean it really depends on a lot of factors here
SPEAKER_00: I'm still waiting for some sort of logical explanation For the number of sort of fake or spam accounts on Twitter And Twitter is refusing to tell us So, you know, this just seems like a strange thing Wait, sorry, are they refusing to tell you or you don't think they really know?
SPEAKER_03: I mean, there's a good chance they may just have no idea
SPEAKER_00: They claim that they do know
SPEAKER_03: And they claim that they've got this complex methodology
SPEAKER_00: That only they can understand
SPEAKER_04: But the guy who landed two rockets simultaneously can't understand
SPEAKER_00: When you stir this cauldron and then you throw the knuckleball in And then you throw the cauldron and Popsworth, toilet trouble And then suddenly it comes to you in a dream, I don't know But there should be some, you know, objective way to assert the thing Because this is a material public statement
SPEAKER_03: It's a, you know, it's a material adverse misstatement
SPEAKER_00: You know, if they in fact have been vociferously claiming less than 5% of fake or spam accounts But in fact it is four or five times that number or perhaps 10 times that number This is a big deal It's not the same like if you said, okay, I'm gonna, I agree to buy your house You say the house has less than 5% termites That's an acceptable number But if it turns out it is 90% termites That's not okay, you know, it's not the same house This house is made mostly of termites Termites leave, literally your house will disappear Because it's mostly made of termites So, you know, that would obviously just not be appropriate So in making the Twitter offer, I was obviously reliant upon the truth and accuracy of their public filings And if those filings are not accurate, it's simply not That's, it's not, you can't pay the same price for something that is much worse than they claimed
SPEAKER_04: And, you know, they say Elon, life's a negotiation So at a different price, it might be a totally viable deal, correct?
SPEAKER_00: I mean, that
SPEAKER_00: I mean, it's not out of the question But I really would, you know, the more questions I ask, the more my concerns grow So, you know, at the end of the day, acquiring it has to be fixable And fixable with reasonable timeframe and without revenues collapsing along the way and all that sort of stuff And so, you know, I really need to see how these things are being calculated And it can't be some deep mystery that is like more complex than the human soul or something like that It's gotta be, you know, I think we can apply the scientific method to this and try to figure out what's really going on And Twitter's revenue is primarily dependent, I think 70% or something of that order, on brand advertising as opposed to specific purchase advertising This is a big deal because brand advertising is not, there's not a purchase that results from that So it's basically, you know, how much mindshare or like basically if you're a big company, how often do they hear your name? It's as opposed to something that where you can directly measure the outcome So that means that they're somewhat going on faith And if that faith is undermined or reduced because of the reality of the situation coming to the fore Then the Twitter's revenue will be significantly impaired and that's a major problem
SPEAKER_02: Elon, did you have a chance to ask these questions during your negotiation? Like I said, I was reliant upon their public filings
SPEAKER_00: So to the degree that their private public, and this is normal for a public company If you make a formal filing, that is what investors are relying on Whether they are making an acquisition offer or simply buying some shares So the accuracy of these filings is important whether you're buying one share or the whole company And so if these filings are inaccurate, if they're sort of potentially bladier, it's a big deal
SPEAKER_01: Elon, do you have a sense of why this has been such a persistent problem for Twitter? Do they not have the technical capabilities to solve the bot problem? Or is it more of like they've under prioritized the issue or been unwilling to because potentially there are implications for ad revenue?
SPEAKER_00: I don't know, it's sort of speculative at this point The worst interpretation would be that they don't want to look too closely at the thing because they might not like the answer That would be the worst interpretation I'm not sure what the best interpretation is, but the least bad interpretation would be maybe they thought it was this way But the way they were doing it was wrong and they didn't realize they were mistaken and simply weren't paying enough attention It does seem as though it should be a lot easier to get rid of the bots and spam and trolls We're not trying to split the atom here, you know We're not trying to get to the moon, okay? We're just trying to limit the amount of obviously scammy accounts If it's like a Bitcoin giveaway, you know, probably it's a spammer, you know, like Maybe, you know Wait, you're not giving away 100 Bitcoin?
SPEAKER_04: I just sent you 10 each If you send me 2 Bitcoin, I'll send you 1 back, right? That's my
SPEAKER_00: What if I send you 20?
SPEAKER_04: Actually, I thought one of the interesting things that came up in your product roadmap Or I guess this was released and people covered it Was the possibility of Twitter becoming kind of a super app with payments included Maybe perhaps even Doge or something. This seems to me based on your work with David at PayPal Like a pretty brilliant idea What's the vision there in terms of if you were able to buy it, you know, perhaps at the right price What would it look like if, you know, I could add Jason to add Elon Musk, you know, 10 bucks or something If we were splitting a check or something
SPEAKER_00: Sure. Well, for those that have used WeChat I think that WeChat is actually a good model If you're in China, it's basically you kind of live on WeChat, it does everything It's sort of like Twitter plus PayPal plus a whole bunch of other things And O'Roland's one was actually a great interface and it's really an excellent app And we don't have anything like that outside of China So I think such an app would be really useful And just like the utility of sort of a spam-free thing where you can make comments, you can post videos You know, I think it's important for content creators to have a revenue share Now this does not need to be done on Twitter It could be done from something that's created from scratch So it could be something new But I think this thing needs to exist, whether it is converting Twitter to be the sort of like kind of all-encompassing app that, like I said, everything from Digital Town Square where important ideas are debated You know, maximally trusted and inclusive And at a point where you sort of have a high trust situation, then payments, whether it's crypto or fiat, can make a lot of sense You just want something that's incredibly useful and that people love using But it's either convert Twitter to that or start something new Those are the two But it does need to happen somehow
SPEAKER_04: Well it's interesting you bring that up because the price of Twitter is pretty high And you've built a couple of companies and some engineers like to come work for you And you've now gone through the intellectual exercise of studying all this If you're looking at the two choices now, fixing Twitter given all these problems And maybe just starting your own version, which one are you leaning towards? I have watched you build a couple of companies and the products have turned out pretty good So is it easier for someone like you to just start from scratch?
SPEAKER_00: I mean, it's certainly the My default inclination is to start things from scratch I mean, I'm not really, I don't buy things There's still this sort of, you know Like SpaceX was started from scratch In the case of Tesla It was like five people There's still this guy, Mark Eberhard, who's the worst guy I've ever worked with Who tries to claim like sole credit essentially for creating Tesla And if he's so damn great, why don't he just go create another car company when he was fired? But anyway Well, I mean, that's a pretty good story I remember having this conversation with you
SPEAKER_04: We were having a conversation about the Roadster I think I can tell the story I said, how's it going, pal? And you said, well, I got one problem It turns out the Roadster parts and putting it together cost 190,000 And I said, I gave you 150 for number 16 So if you make 2000 of these, you're going to lose 80 million dollars And you were like, yeah, or double that I mean, they basically, the parts of the car cost more than they were selling it for When you were starting to get involved It was a disaster
SPEAKER_00: I got involved well before that I got involved when Tesla was nothing but a piece of paper Let me be crystal clear Crystal fucking clear No, they didn't bring me in Either Either
SPEAKER_00: I was going to start an EV company with JB Strouble Based on the AC propulsion T0 And when I asked AC propulsion if it was okay to do that They said, well, there's also some others who want to create an EV company But have not created one yet Would you like to join forces with them? And I said, okay, well, we'll do that That was a huge mistake JB and I should have just started the car company ourselves Instead, we teamed up with Everhard, Topping and Wright Big mistake The actual moral error here was me trying to have my cake and eat it too Which is like, I just want to work on the technology and the product And have someone else be the CEO and sort of run the business operations Because I just like working on technology and product design And also I was doing SpaceX at the time and a rocket ship blowing up So it seemed like, okay, this is like, I always wanted to do an electric car company This is how I can have my cake and eat it too That was a huge mistake and fundamentally a moral error And so, in the end, I had to friggin be CEO and I didn't want to be basically But it's either that or the company is going to die So we started with really just nothing And the T-Zero prototype from AC Propulsion That's the precursor to Tesla To be clear, once again, when we created Tesla When I joined, there were no employees, there was no intellectual property There was no prototype, there was no nothing
SPEAKER_00: To be crystal fucking clear And it almost bankrupted you, I mean, that sent you to the cliff of insolvency
SPEAKER_04: Yes, we were on the ragged edge of bankruptcy so many times it was ridiculous
SPEAKER_00: So 2008 was one of the worst years where basically the GM and Chrysler Ford almost went bankrupt And trying to raise money for a startup electric car company in 2008 while GM is going bankrupt Was difficult to say the least People were angry that I even asked them for money They were like, fuck you and hang up So the only way that Tesla actually made it through 2008 was a subset of the existing investors Which includes people like Antonio Gracias and Steve Jovitz and a few other key people Ira Aaron Price, who I've held a debt of gratitude to to say And I put in all the money I had left and they said everything, literally everything I didn't even have a house So I've had the house So I was like staying actually in Jeff's school's bedroom, spare bedroom And the subset of the investors would say, okay, they're putting as much as I put in So I put in everything and then we closed that round 6 p.m. Christmas Eve 2008 That was the last hour, the last day that it was possible because after that people were breaking for the holidays And we were to bounce payroll two days after Christmas
SPEAKER_04: It was a pretty Death's doorstep I mean, it was an incredible moment in time and people also forget at the time that the first two rockets SpaceX sent up Didn't exactly make it to orbit The first three And I remember having dinner with you at that time and I asked you, hey, how's it going? I heard Glauker says you got four weeks of payroll left and you said, that's not true And I said, thank God. And you said, we have two Yeah
SPEAKER_00: I said Both SpaceX and Tesla in 2008, if we'd simply paid our suppliers on time, we would have gone bankrupt immediately
SPEAKER_03: Tell us, tell us actually It was a pretty crazy moment in time because I also remember asking you, we were having dinner at Boa
SPEAKER_04: And I said, well, certainly it's got to be some good news And you took out your Blackberry to date the conversation, I don't remember it Oh yeah And you said, don't tell anybody, Jay Cowan, I said, no problem And you showed me the clay version of the Model S Yeah The most beautiful car I'd ever seen and I said, oh my God, it's stunning How much is it going to cost? You said, I think I can make it for 50,000, I remember it was yesterday I said, if you make that car for 50,000, you'll change the fucking world And you did it
SPEAKER_00: It was a little more than 50,000, but Yeah, you did
SPEAKER_04: Let's ask about SpaceX Okay, well, let's ask about SpaceX, but I want to ask one more personal question Has life gotten easier for you as these companies have hit scale Or has the complexity made life even more challenging Because those early days, it was just fighting to survive Nobody knew who you were, you were anonymous And it was really just about the work And now, let's face it, you're the world's most famous guy And everybody's watching everything you do, but these companies are also very big So what's life like for you today? Are you enjoying what you're doing every day?
SPEAKER_00: Well, I mean, it's somewhat of a rollercoaster So there are good days and bad days And there are also crisis issues And knock on wood, we're not facing death in the face It's definitely quite stressful when death is trying to eat your face off And the foam is just getting right there It's pretty stressful in that situation Both SpaceX and Tesla have significant cash reserves It's not like we're staring death in the face We can sort of see it over in the horizon So we don't want to get complacent or entitled But if it's not like just sort of foaming at the mouth, gnashing, trying to eat your face off on a daily basis We've moved on from that point And hopefully never return But there are a lot of issues that need to be… If you're a CEO of a company, the chore level is high And if you don't do your chores, then the company goes to hell And I hate doing chores, frankly So who does? So that's the real… There's a whole bunch of sort of personnel issues and legal issues And things that I don't find enjoyable to work on But if I don't work on them, the company suffers So it's more like just the sheer volume of work is insane And then I go do something, go add to it with Twitter or something like that Yeah, like your extra processor Yeah, I mean, I have a habit of biting off more than I can chew
SPEAKER_00: And then just sitting there with like chipmunk cheeks
SPEAKER_03: Tell us a little bit about where we are at SpaceX Like how you fund the ability to go to Mars But then also commercially still build a conventional space business domestically I think this Russia thing was probably really good for SpaceX If you want to just tell us a little bit about that
SPEAKER_00: Sure, well, the goal of SpaceX is to develop the technology that enables life to become multi-planetary And make humanity a space-faring civilization Which I think is a very exciting, inspiring thing And it's like one of those things that I think just makes kids be excited about the future And we need things that are inspiring and exciting And make the future seem like it's going to be better than the past Life can't just be about solving one miserable problem after another It's got to be like what's inspiring and exciting And I think that a future where we are space-faring civilization Is one that we can all get excited about And we can go out there and find out what's out there in the universe And what's the meaning of life And where are the aliens, and hopefully they're friendly So, it's interesting, I do get asked about the aliens question a lot
SPEAKER_00: And I've not seen any evidence of aliens And I'll be the first to tweet about it or whatever if I see someone I mean, you'll tell us if you find them
SPEAKER_04: I will definitely tell you if there's aliens
SPEAKER_00: And I think it would be quite helpful if we found aliens Like probably SpaceX would get a ton more revenue Because people are like, oh man, aliens, we've been upgraded on space technology pronto What if they're unfriendly? It's the idea that you build basically the ability to do orbital cargo
SPEAKER_03: Take all those profits, launch Starlink, take all those profits And move it all into building something that can get to Mars Is that the kind of rough plan?
SPEAKER_00: Pretty much, if it was like a three-slide power point It would be pretty much as you described Which is develop rockets that are capable of taking satellites to orbit And crew to the space station Basically servicing government commercial space launch needs And then build a global communication system in space That obviously does a lot of good for Earth By providing internet connectivity to the least served A satellite system is really great for remote locations And countryside or remote islands or places where someone's trying to cut off their internet As a prelude to a war, we take down the communication system
SPEAKER_04: Like in Star Wars It can be pretty helpful. I think Starlink is a forceful grid in its own right
SPEAKER_00: By providing connectivity to the least served Where they've got either no connection or a very expensive or poor connection We're connecting a lot of remote schools in Brazil right now I'm actually going to be headed there to kick things off But they've got a lot of schools that have no connectivity at all In a modern age, how do you learn with no connectivity? I guess old textbooks and stuff But you're at a huge disadvantage if you have no digital connectivity I think there's just a lot of good that Starlink can do just by itself But then the revenue generated from Starlink is what can enable the Completion of a permanently crude base on the moon Which would be the next step from Apollo Let's not go there for a few hours and then head back Let's have a permanently occupied science station on the moon We could also build some pretty epic telescopes on the moon That would enable us to learn more about the nature of the universe And figure out what's going on and maybe detect those aliens Do you think that there's enough profit in those businesses to fund all this?
SPEAKER_03: Or do you need Wall Street and other investors to come share the load with you? Is going to Mars a partnership with the government?
SPEAKER_02: Does it need to partner with governments to get there? I think technically it does not need to partner with governments
SPEAKER_00: But of course government support would be helpful It's going to be very expensive to build a self-sustaining city on Mars In order for us to become multi-planetary in a way that's meaningful The key threshold is at which point does the city become self-sustaining Such that if the ships from Earth stopped coming for any reason It could be any reason, it could be World War 3 or it could be just civilization subsided And just gradually got decrepit or something But if the ships stop coming, if the resupply ships from Earth stop coming to Mars for any reason Does the city still survive? And that's really a large base of resources that are needed on Mars You can't be missing any one critical ingredient And think of this like there are these various great filters that perhaps stop civilizations And one of the great filters is will we become a multi-planet species or not Will humanity be one of those species that passes the great filter of going beyond one planet and being a multi-planet species And this is certainly something we will have to do at some point Because the Sun is expanding and will eventually boil the oceans and destroy all life on Earth So if you care about life on Earth, you should really care about life becoming multi-planetary and ultimately multi-stellar Because otherwise you're basically saying you're signing the sort of death warrant for all life as we know it It's inevitable And then there's also the various things that kill off the dinosaurs And I mean if you look at the fossil record, there have been five major extinctions that are sort of on the order of 80 to 90% of all creatures on Earth dying For a wide range of reasons And then humans can also, you know, with the World War III danger that other creatures didn't have Where we could do ourselves in by misusing advanced technology and sort of just having some radioactive hellhole that's all that's left after World War III So you could even characterize it potentially as which will come first, World War III or life becoming multi-planetary on Mars Sorry, I was going to shift, but you know when you think about the importance of going to Mars versus solving critical energy and climate change problems here on Earth
SPEAKER_02: Obviously the effort with Tesla is related to sustainable energy And I think going back to like probably the 1950s there were engineering designs around plasma fusion or fusion-based systems that have evolved to these plasma systems, to these tokamak systems And every year, every decade it's like hey next decade we're going to have it What's your point of view on where plasma fusion systems are? Are we going to have fusion energy this century, this decade? And does it create limitless energy where the electricity production goes up by 10,000 fold and the price of electricity drops by 10,000 fold And then what does that world on Earth look like if that happens? So I guess the question is like, is that technology real? When does it happen and what happens to the world here when and if that happens?
SPEAKER_00: I'll answer that question, but then let me sort of point out what the actual issue is If the question is like, is it possible to solve fusion energy? 100% yes, definitely, definitely, definitely, definitely, for sure And really just using a tokamak style, which is like basically a donut ring with electromagnets that control the plasma The way to solve that is simply scale up the tokamak. Fusion is very much a scale-based thing You want to minimize your surface to volume ratio So as you scale up a tokamak, you reduce your surface to volume ratio, which means like the volume you have relative to the surface You now have much more, like you can basically have a hot zone in the center that's relatively far away from the walls and more of a hot zone So it's not in my mind a question as to whether fusion can work, but there is a question as to whether it is economically viable And whether it is competitive with alternatives I think the economic viability of fusion is a much bigger question And I think the answer probably is that fusion is not competitive economically I think that is, I would say it's probably not competitive economically by an order of magnitude Is it a materials breakdown or what does it break down economically?
SPEAKER_00: Well, so you can't just use normal hydrogen You need to use like deuterium and tritium like unusual forms of hydrogen Helium-3, you know, there are some other types of fusion that could be used But these are just not, there's not a lot of this raw material It's quite difficult to get the raw materials First you have to get the raw material, that's expensive raw material And then it's not just about generating the energy, you've got to turn that energy into usable electricity You can't just have a hot thing So the hot thing has to translate to usable electricity
SPEAKER_00: So I think you've got a cost of fuel issue, which is very significant You've got a whole bunch of knockdowns from when you generate the heat to when you actually convert that into electricity You've got some very difficult maintenance issues with a fusion reactor So, and that should be then compared to alternatives The sustainable energy alternatives that I think are overwhelmingly more competitive are Solar energy, wind, geothermal, hydro, some tidal energy But it's really primarily solar and wind Now, you can really say like, why bother creating a fusion on earth when we have a gigantic fusion reactor in the sky that just works with zero maintenance And it shows up every day It's pretty consistent, yeah
SPEAKER_02: But Elon, can we scale to 1000x or 100x our electricity production here using solar and other renewable sources
SPEAKER_00: Yes, so the amount of surface area you need to power the United States is remarkably tiny So you need like basically roughly 100 miles by 100 miles of territory And it obviously doesn't need to be in one place in the United States to power the United States It's like a little corner of Texas or Utah, the entire country And then if you, you could basically power, you probably 10x just with solar alone Without displacing anyone's home, power an economy 10 times the size of the United States in the United States on land If you extend that to water, because earth is 70% water, I mean you could say, okay now we could probably have a civilization that is 100x as energy intensive as we currently have it
SPEAKER_00: So what does that look like with the last part of my question, which is a world where energy costs are say 100x cheaper than they are today and we have 100x more energy production capacity
SPEAKER_02: What changes about civilization? What do we do differently? What do we see change most kind of dramatically? Well, currently we're not, because of just generally low birth rates almost worldwide
SPEAKER_00: Civilization is not headed to have a population that is the order of magnitude greater than where we're currently headed towards a population decline And this is almost everywhere in the world So, you know, it basically seems as though as soon as you have like urbanization and education beyond a certain level and income beyond a certain level, birth rates plummet And so as countries get wealthier, the birth rates plummet, it's somewhat counterintuitive because people will say like, well, it's too expensive to have a baby Nope, the wealthier you are, the fewer kids you have, the more educated you are, the fewer kids you have. So it's the inverse So I'm not sure who would use all that energy unless there's a significant change in the birth rate Or we have a very robot oriented economy. So that's also possible So if we've got a lot of, you know, four wheeled robots in the form of cars and androids, humanoid robots Then you can certainly see that there'd be perhaps a need for an order of magnitude more energy But it's not coming from the humans unless something major changes on the human birth rate level This by the way is I think the biggest single threat to civilization right now is the
SPEAKER_03: Why do you think societally people just make those decisions when they become more affluent? Is it that they just become more selfish or there's more things for them to do and they have more money to spend on themselves and they say, you know what, I don't want to have a large family, I want to, you know, go to Coachella Yeah, well, there is this like weird like mind virus thing where some people are think like having fewer kids is like better for the environment
SPEAKER_00: Yeah, that's crazy Total nonsense. The environment is going to be fine. We're going to be fine even if we if we doubled the size of the humans This is and I know a lot about environmental stuff. So, you know, we can't have civilization just dwindle into nothing
SPEAKER_00: And, you know, Japan's leading indicator here like the Japan's population declined by 600,000 people last year that lowest birth rate in history It's, you know, it's pretty bad. So, I don't know, I think, so this one element of is, is a lot of people just think that having kids is somehow bad for the environment. I want to be clear it's not. It's essential for maintaining civilization that we at least maintain our numbers. We don't necessarily need to grow dramatically, but at least let's not, you know, gradually dwindle away until civilization ends with us all in adult diapers and in a whimper Like we don't want civilization to end in adult diapers with a whimper that would suck Bleak, bleak and bad Well, I mean, and you and I have had this conversation. I mean, in Japan, I had two people tell me when I was there, like, I think it's immoral to bring humans into the world. I mean, people have gotten very sad about the future. It's kind of crazy.
SPEAKER_04: It's great. Life's awesome.
SPEAKER_00: Yes. No, there's there's literally I've heard many times, like, how can I bring a child into this terrible world? I'm like, have you read history? Because let me tell you, it was way worse back then. Okay. Yeah. Now is a good time.
SPEAKER_04: Now is a good time to be born. Hey, you know, listen, I know you're super busy, but I want to ask you about the move to Texas because I've been thinking about it. Austin, California. I don't know. Some senator told you to go fuck yourself and like, you know, like we don't need you here.
SPEAKER_00: Yeah, I think it's been a couple of senators who said that actually. It seems to be turning into a bit of a trend. But how has building the Tesla Gigafactory, which I got to see in Austin a couple of weeks ago, and it was one of the most inspiring things I've ever seen.
SPEAKER_04: I mean, I don't know how many months it took to build there, but how long did it take to build that dreadnought? And then what would have taken to build that in California, California under Gavin Newsom? So we're both the Gigafactory, which is the biggest factory in North America. I think possibly the biggest factory in the world.
SPEAKER_00: And it's three times the size of the Pentagon to give you a sense of scale. Okay. This is friggin big. It's like, it's weird. It's like so big. It's weird. Like you drew. It's like I was trying to find you in it. And I was trying to drive around and it took me about 45 minutes to find you.
SPEAKER_04: Yeah. Like, no, you have to like call. So you can't like find someone in the building. You have to call them on their cell phone and say, where are you?
SPEAKER_00: So, I mean, the building is like just under a mile long and we're actually going to extend it. It will be like literally a mile long and about a quarter mile wide. And it's 80 feet tall. So it's just ridiculously big. And when you think about it, like for manufacturing situation, like what, what, what are the two, the two things that really define manufacturing competitiveness are economies of scale and technology. And so if you've got an ace on economy, like if you sort of maximize your ace level on technology and you maximize your ace level on scale, this is obviously going to be the most competitive situation. And that's why they're so freaking giant. And the, the, the, the, a giga Texas will go all the way from cell raw materials, like, like, like basically rail cars of cell raw materials coming in and then forming the battery cell. Then the battery pack, uh, building the, the, the motor, uh, casting. We're also have introduced a major innovation, which is to cast the entire, uh, front third and rear third of the car as a single piece. Um, I got this idea from toys actually, because I was like, how do they make toys? Those are cheap. They just cast them. I was like, well, can you pull the casting machine that big? And they're like, well, no one ever has. I'm like, is there, are we breaking physics? Like, no. Well, let's just ask them. And there were six major casting machines suppliers in the world. And five of them said no. And the six said, maybe I'm like, I'll take that as a yes. Um, you wanted to do this for the model three, but it was just too soon. Huh? Uh, and now it's almost there. Yeah, actually this, this partly comes from the multi, which is actually a fantastic car in many ways.
SPEAKER_00: Um, um, but we were rightly criticized for an inefficient design, uh, with, for the front and rear body. Um, uh, like Sandy Monroe, who I think is really excellent from an engineering standpoint and really a very fair critic. Uh, he pistol whopped us for, um, the design of the battery apart and piece by piece told you why you suck. And then he did the Y and told you why you're awesome. He took it apart and tells us exactly why he's, why we sucked. And he was correct.
SPEAKER_00: Um, and then, and I was like, well, that's pretty embarrassing. So, uh, no, there, he was complimentary of other parts of the carpet, not the body design. And, uh, and so it's like, okay, we're going to go from like, you know, uh, the, the, it's just an incredibly difficult party to make. It's made out of like 120 different pieces with dissimilar metals that are joined and you've got galvanic corrosion challenges. It's very difficult to make, um, to a single piece casting that's one piece. So like 120 pieces went down to like one. So, um, it's, it's, it's a, it's a huge, and the, the, like the model Y body shop, especially the new one where we cast both the front and rear is 60% smaller than the model three body shop. So it's, it's, you know, gigantic, uh, it's quite, there's a lot of innovations at Tesla besides the stuff that is obvious. Um, so anyway, so yeah, the, and really, you know, to, to, to refer to Gavin Newsom, like, uh, you know, if you, if you had a gun to Gavin's head, okay. Um, and said, we need to build, start building this factory in California right now. He couldn't do it because there are so many, uh, regulatory agencies, um, and so many, uh, litigators in California that want to stop you from doing anything that even if you're the governor of the, of the state, you cannot get it done. Um, so something's gotta be done to, to, to, to, you know, cause California used to be the land of opportunity and it's a beautiful state. And I love, I loved living there. I still spend a lot of time in California, even though every time I go there, I get literally every day I go there, I get the Jesus tax tax bill by day. Like the sheer cost per day of me going and working in California days, boggles the mind. And I, but I still do it, you know?
SPEAKER_00: Um, but, but the California is gone from land opportunity to, to the land of, of, of sort of taxes, uh, overregulation and litigation. And this is not a good situation. And really, there's gotta be like a serious cleaning out of the pipes in California. How many months was it to get the giga Austin done? It took a year and a half, two years? Yeah. 18 months to build something three times the size of the Pentagon.
SPEAKER_00: Incredible. And you just basically, the answer to how many months it would take in California is infinity.
SPEAKER_00: We would still be working on the permits.
SPEAKER_03: Yeah. Elon, this begs a good question, which is, you know, like, sorry, keep signing paperwork.
SPEAKER_02: We have one more form for you.
SPEAKER_02: What's a better model? What's a better model for government? So, you know, like all governments tend to increase in complexity, dictatorship capacity. Is the dictatorship the right model? And, um, you know, like, like how do we solve this? Let's say you go to Mars or let's say you have to fix California. Is California permanently broken? Is there a way to fix it? Or like, how do you set up a better model so that you don't end up having this kind of special interest complexity situation that eventually kills the population? Well, I mean, I think ultimately with California, the people of California just have to get fed up and demand change.
SPEAKER_00: That's the thing that really has to happen. And there's got to be an above 0% chance of the Republicans winning in California. If it's just the Democrats every time, you've got to be. And this is like occasionally the thing is that right now, plus the level of gerrymandering, which is basically just treating the people like sheep and it's terrible. That's gone on in California is outrageous. So California, the Dems have a super majority in the House and Senate in California and the governor and everything. And so how responsive is any political party going to be to the people if they are guaranteed to win? It's a one party state. And so I'm not saying that, you know, go and sort of elect the Republicans every time. But if it's never, you're just making California a one party state. They will no longer be responsible, responsive to the people and will only be responsive to those that funded their political campaigns.
SPEAKER_02: Clip Elon saying that 30 seconds on TV over and over. Go ahead, sex. Yeah. So, Elon, shifting gears to the economy, you know, we saw this surprise report of negative 1.4% GDP growth in Q1.
SPEAKER_01: Interstate's been rising that increased the cost to the consumer of getting loans, things like that. We've had a stock market correction, really a crash in a lot of growth stocks, software stocks. From where you sit and the data that you see, where do you think the economy is headed right now? Do you think we're in a recession or is it just a risk? How do you assess our current economic situation? Well, predicting economic economics is always difficult and one should assign probabilities to these things.
SPEAKER_00: Ironically, I did last year, people asked me what I think about the economy. I said, well, I think we might enter a recession in approximately spring of 2022. All day. Nailed it.
SPEAKER_04: Yeah. So, now the thing is that recessions are not necessarily a bad thing. I've now been through a few of them and what has happened is if you have a boom that goes on for too long, you get misallocation of capital.
SPEAKER_00: It starts raining money on fools, basically. It's like any dumb thing gets money and I'm sure you've seen a few of those. So, at some point it gets just out of control and you just have a misallocation of human capital where people are doing things that are silly and not useful to their fellow human beings. And then those companies, there needs to be sort of an economic enema, if you will, to have everyone sort of shift uncomfortably in their seats. I'm sorry, it's just I'm visualizing it. The economic enema.
SPEAKER_02: I mean, listen, it's got alliteration.
SPEAKER_00: This too shall pass.
SPEAKER_04: Eventually the economic enema does its job. It clears out the pipes, if you will.
SPEAKER_00: Yes. And sort of the bullshit companies go bankrupt and the ones that are doing useful products are prosperous.
SPEAKER_00: But there's certainly a lesson here that if one is making useful product and has a company that makes sense, make sure you're not running things too close to the edge from a capital standpoint. They've got some capital reserves to last through irrational times because in the past, when there's been a recession, it has gone. It's amazing. It's flipped like a light switch. I mean, David, do you remember this one from the PayPal, you know, X PayPal days when we raised $100 million in March of 2000? And we literally we had the demand was so high, we had people like VCs like just literally without even a term sheet, wiring money into our account. We'll send the term sheet later.
SPEAKER_00: They literally were like, we're like, sleuth out our bank account number and wire money in. And we're like, where did this come from? And it's like, oh, so it was like there was literally fire hosing money in March of 2000. And then in April 2000, the market went into freefall and it went from money, raising money was trivial to even good companies could not raise money in a month. So it's just important to bear in mind, like that, you know, PayPal almost went bankrupt in 2000. We came close, but thankfully we'd raised that $100 million in March 2000, without which we'd be in a game over, basically. And we kind of saw it coming. So it's like we got that the X-Confinity merger done in like three weeks and raised $100 million because we were like, oh, how is we see this coming to an end pretty soon? And then a month later, it was like, you know, a nightmare, basically. And so it's just important to make sure if you're a healthy company, you've got some capital to get through things. And then what's your costs? And if it is a recession, which more likely than not, it is a recession, I'm not saying it is, but it probably is, then just watch your cash flow and get positive cash flow as soon as you can. So, yeah, but I think we probably are in a recession and that recession will get worse. But, you know, these things pass and then there will be boom times again. So it'll probably be some tough going for, I don't know, a year, maybe 12 to 18 months is usually the amount of time that takes for a correction to happen. What do you guys think?
SPEAKER_04: Yeah. David, how do you feel about it? Yeah, I mean, it feels like it started, you know, what started as a slow down earlier this year now seems like, I mean, technically, I guess we need two quarters of negative growth to be in a recession, but it feels like we're in one.
SPEAKER_01: It feels like it started. You know, the growth stock, the software businesses that we invest in are sort of the canaries in the coal mine. And there's a lot of dead canaries. You're having a hard time breathing?
SPEAKER_04: I'm not doing that! It's not dead, it's just napping.
SPEAKER_00: It's napping. Wake up little birdie!
SPEAKER_04: It's just lie.
SPEAKER_03: It's just stunned. It got stunned for a brief moment and it'll be fine.
SPEAKER_00: It sort of reminds me of the parrot, you know, the Pet Shop sketch with the parrot with Monty Python. Yes, Monty Python. It's pining, this parrot is pining for the fjords. Hey, Elon, a lot has been talked about as we wrap here and you've been incredibly gracious giving us so much time. Thank you for that.
SPEAKER_04: A lot of talk about American exceptionalism over the last couple of years waning and maybe this country had seen its best days. And we see the work you're doing and other people in this great country are doing and the debates we're having about the future. And yeah, China's doing pretty fantastic, Russia's on the ropes. But it does seem like America is still producing some of the greatest companies the world has ever seen, some of the greatest innovations. What are your thoughts on America and our future and what we need to keep this country and this beacon of hope that four of the five of us were not born here? Two of you came from South Africa. No, three of you. Three of you came from South Africa and one of you from Canada. I don't know what they're putting on the line. Oh, from Sri Lanka. Via Canada. He came through Canada too. Yeah, I know. It seems like that's the way. Canada is a gateway. And how do we, well, I'm hinting at the answer here, but it does seem like our immigration policy is absolutely insane. And maybe we need to keep collecting some of the great individuals that I get to share the stage with here and yourself. We need to keep bringing great people to this country. Why can't we get that in our heads that not immigration, it's talent recruitment? No, absolutely. I think it's incredibly important that the United States be like the destination for the world's best talent.
SPEAKER_00: I mean, you can think of this like a pro sports team. If you want to win the league and you want the best players on your team. Now, there are obviously a lot of very talented people born in the United States. But if you could add a few aces from outside the country to the team, you're going to win the league. And here's the thing. Those aces actually want to work for your team. They don't want to compete against you. They want to be on Team America. And so it's like we have to like fight them off to not be on Team America. That's the crazy thing. And so it's like if you have some aces that are the difference between winning and losing, we should be like really recruiting them. Like you'd recruit like a star basketball player or football player. That's what we should be doing. Active recruiting. Just like if you're a company that wants to succeed, you actively recruit the best talent. And then and that's the way to win. And if that stops happening, America will stop winning.
SPEAKER_04: And we have two administrations in a row, Biden and Trump, who don't want to let the greatest minds, the most talented people into this country is absolutely insane. I think you put this every day. Really is like actually anyone who is going to who wants to work hard and be and do useful things.
SPEAKER_00: And this, you know, we want in the United States. And it's not just people who are sort of intellectually strong, but it's just anyone with a strong work ethic. You know, if they're coming from Mexico or if they're coming from, you know, Europe or China, wherever, it's just if they're like going to come here and crank hard and and contribute more than they take. Hell, yeah. I mean, that's just it's a no brainer. We have you been have you been disappointed in the similarities between Biden and Trump on this?
SPEAKER_03: Like maybe you could have expected it from Trump because that was a rhetoric he needed to use to get elected. But it's not as if Biden has flipped the script and said, OK, we're going to go 180 degrees in the other direction. He's kind of kept it the same, which has been really surprising, actually. It's hard to tell what Biden is doing, if you're totally frank.
SPEAKER_00: I feel like it's weekend at Bernie's. The real president is whoever controls the teleprompter. You know, it's like it's like the path to power is the path to the teleprompter. You know, like what it is that he needs to tell a prompter. So, you know, I do feel like if somebody would accidentally leave on the lean on the teleprompter, it's going to be like anchorman. It's going to be like you, you, you, you, asdf one, two, three, you know, type of thing. I mean, in fairness to Biden, he hasn't been napping as much as he needs to.
SPEAKER_04: It's just it's hard to say the things that are getting done.
SPEAKER_00: You know, I mean, this administration just it doesn't seem to get a lot done. Like and, you know, whatever, like the Trump administration leaving Trump aside, there were a lot of people in the administration who were effective at getting things done. So this administration seems just just to not have like the drive to just get it done. Get it done. That that that's why it's that's my impression. So, you know, we definitely need to fix immigration policy. Like we had covered, which was an issue. And so that was like one reason to like, you know, I guess, clamp down on it. But now it's now we've moved on. And so let's let's just make sure we're getting top talent in the United States. And really, I'd say broadly, it's anyone who wants to work their ass off and and and contribute more than they take to the economy. Like that's just necessarily going to make for a stronger, better society in America.
SPEAKER_03: Did you see Jeff Bezos's tweet back and forth with Biden, where Biden, I think, was talking about inflation, inflation. But then he correlated that to taxing corporations and Bezos said this is misinformation and disinformation, et cetera, et cetera. What do you what do you think about that whole exchange then back and forth?
SPEAKER_00: I mean, the obvious reason for inflation is that the government printed a zillion amount of more money than it had, obviously. So it's like the government can't just, you know, have issued checks far in excess of revenue without there being inflation, you know, velocity of money held constant. So unless there's something would change with velocity of money, but but it's just the federal government writes checks. They don't they never bounce. So that is effectively creation of more of more dollars. And if there are more dollars created than the increase in the goods and services output of the economy, then you have inflation again, velocity of money held constant. But so this is this is very basic. This is not like, you know, super complicated. And if the government could just issue massive amounts of money and have and deficits didn't matter, then why don't we just make the deficit 100 times bigger? OK, the answer is you can't because it will basically turn the dollar into something that is worthless. So and various countries have tried this experiment multiple times. It's not like, oh, I wonder what happens if this if this is done. Have you seen Venezuela like the poor people of Venezuela are, you know, have been just run roughshod by their government. And so obviously you can't simply create money. The true economy is very important. The true economy is the output of goods and services. It's not money. It's it's literally what is the output of goods and services? Money is simply a way to to for us to or anything that you call money is a way for us to conveniently exchange goods and services without having to engage in barter and also to shift obligations in time. That those are the two reasons that you have money, this thing called money. It's really a database. Money is an information system for for labor allocation and for exchange of goods and services and for translating in time. And the quality of that information is a function of it's like you basically you can apply information theory to money. And I think it helps explain why one money system is why one action is better than another. And so if like the money you just just like an Internet connection, you'd want something that's high bandwidth, low latency and jitter and is not dropping packets, does not have a lot of errors in the system. And the same is true true of money. You want that. And really, like you said, what did PayPal really, really do that helped improve the bandwidth, the speed at which money could move instead of of mailing checks back and forth, which amazingly, that was what people did in 2000. You can now do real time exchange of money and then you could ship your goods immediately instead of mailing a check and waiting for the bank to clear the check. So like and the ultimate thing with PayPal or if it sort of was in the X.com sort of went less sort of niche payments, more so broad financial would be to simply does that just intermediate all the heterogeneous COBOL databases out there. Running on mainframes during batch processing and have a single real time system that that was secure and not batch processing. And so it would just be from an information standpoint, more efficient and eventually it would all the batch processing COBOL mainframes operated by the banks would cease to exist. You've spent more time and built more in China than almost anybody.
SPEAKER_04: I mean, Apple would be the only company I could think of that's probably got a bigger footprint, but I'm not certain of that. What have you learned about China that you didn't know before you opened the factories there and started delivering cars there? And what should we know about China? You know, as Americans, how should we think about China and our relationship with it? Because we haven't spent time there. Sure. Well, I'd say like China, first of all, is not monolithic. It's not like everything is not some plot by the Chinese government.
SPEAKER_00: There are many factions within China that compete vigorously within China. And so and perhaps most important is that there's just a just a tremendous number of hardworking, smart people in China who want to get ahead and get things done. And they're not complacent and they're not entitled and they want to get things done and they want to make a better life for themselves. And what we're going to see with China for the first time that anyone can remember who is alive is an economy that is twice the size of the US, possibly three times the size of the US. It's going to be very weird living in that world. So we better stop the infighting in the US and stop punching ourselves in the face because there's way too much of America punching itself in the face, which is just dumb. And think about like, hey, we've got to be competitive here and there's a new kid on the block that's going to be two or three times our size. We better step up our game and stop infighting. Do you think it's easier to stop infighting once we're beaten or do you think that there's a way folks here can actually just get their political and commercial act together?
SPEAKER_03: Or does it not happen until we realize we've lost? Or do we need a war?
SPEAKER_00: I mean, I certainly hope we don't need a war, but there will be certainly an economic competition that I think will blow people away when they realize just how competitive they have to be to be competitive with companies in China. It's very difficult. Tesla is competitive because we have an awesome team in China.
SPEAKER_03: Do your Tesla China employees work some meaningful percentage more or harder than your Tesla non-China employees? Do you find it's two different companies basically? Well, I think Tesla is somewhat, Tesla is sort of pretty far out there in terms of work ethic anywhere in the world.
SPEAKER_00: So the Tesla work ethic in the US I think is substantially greater than any other car company or any large manufacturing company that I'm aware of. So Tesla does have a strong work ethic in the US, but to be totally frank, the work ethic is exceeded on balance by the Tesla China team. That is I think objectively true. So there's not to say there aren't lots of hardworking people at Tesla US, there certainly are. But if you say on average, the work ethic in China is higher. Tell us what your question is. What about if you're an American CEO?
SPEAKER_03: How do you deal with, do you think, just the need for managing all these political factions inside of a company? You probably saw all the Sturm and Drang related to Disney and what happened to them and what's continuing to happen to them on both sides between their employees as well as the governments, etc. Do you have any advice or what do you tell young CEOs that you hang out with about how to deal with that, how to make those decisions, where you land in the spectrum of dealing with all of this stuff? The non-work issues that are related to now going to work every day. I'm not sure I entirely understand what you mean.
SPEAKER_00: Whether it's the need for political correctness or the need for having political points of view and having to bring that and balance that in the workplace, how do you deal with that?
SPEAKER_03: How do you give advice to other folks about having to deal with it?
SPEAKER_00: Look, I think the point of a company is to produce useful products and services for your fellow human beings. It is not some political gathering place or a thing where that's the point of a company. I'd say politics and other stuff should exist. There's no blue side of why companies should exist. I'm actually late for speaking. I've got to work on the rocket, guys. Yeah. We're going to go ahead and let you get to Mars and I'll see you soon.
SPEAKER_04: Ladies and gentlemen, Elon Musk. Nicely done, brother.
SPEAKER_01: This is my dog taking a notice in your driveway. Oh, man. Oh, man. We should all just get a room and just have one big huge door because they're all just useless. It's like this sexual tension that they just need to release them out. Let your beat be. Let your beat be. We need to get merch.
