Brian Johnson. That's so funny. I I, need who knows? I am the king of nighttime erections. I go to bed thinking about myself when I make up thinking about myself.

So there's a big erection in between. Alright, everybody. Welcome back to the number one podcast in the world. Man, we're starting off with three of the four original band members. Shamatha Palihapitiya, he's your chairman dictator.

The sultan of science, David Freiburg. And, of course, I'm your host, Jason Calacanis. And David Sax from the original band will be on the second half of the show. We're gonna do some of the classics. Yes.

We'll get some of the classics, including Ukraine, Ukraine, Ukraine coming up on the second half of the show in our greatest hits revival tour. But with us again, sitting in the red throne is the one, the only Joe Lonsdale is back. He is, if you can imagine, further right than Keith Rabois and Sachs. They tell him to pump the brakes. Welcome back to the program, Joe Lonsdale.

How you doing, brother? Hey, Jason. Doing great here in Texas today. Yes. I I see you right over the hill on the ranch.

Our ranches are within twenty minutes of each other. Joe Lonsdale and I are shooting guns at our ranches. Are you on a ranch, Joe? Well, I bought a bunch of the homes and connected them, so it's kinda like a ranch, but it's actually a suburb. Yeah.

It's more like a compound. He has a compound. Suburb. Suburb. That creaking sound you hear are the libs rolling in the guillotines.

Yes. He bought the small town he lives in. Joe Lonsdale's here. Of course, he is a venture capitalist, the founder of 8VC. They've got 6,000,000,000 in AUM, cofounded Palantir, OpenGov, and Adipar.

Three billion billion dollar plus companies he cofounded and an early investor in Andro. I'm in the market for secondary shares. You know how to reach me, folks. If you're selling your secondary in Andro, I'm building a position for obvious reasons. And Oculus Wish, Oscar Health, amongst his other investments.

Hey. What was the feedback, Joe, on your first appearance here on the All In Pod? People loved it. You know, you guys gave me no warning, so I was, like, on a mobile phone sideways, but it worked out. It was great.

Everyone saw it. I guess that looks like people actually watch your show, Jason. I was surprised. Apparently, people tune in from time to time, and that's why we call it the number one podcast in the world. How are you doing, Chamath Palihapitiya?

How are you doing, brother? I'm doing really well. Okay. Once again, giving me a ton to work with there. And Freedom Wait.

What would you like to know? Why don't you ask me a question? Oh, well, I asked you how you're doing. Maybe you say, oh, I had a great time with my kids. I took them to Disneyland or I I don't know.

Chef made an amazing arugula. You used to give me some some color to work with here. So Nat was in Rome all last week. Great. What was she doing in Rome?

She had to go see her factory. She also had to go and renew her visa at the US embassy there. Okay. So she's renewing her visa. Hopefully, she'll be able to get back in the country.

I know we've tightened up the borders. Well, she's on an e b two visa. She's already but she should switch to this e b five as soon as it's announced. Oh, yes. You can get the golden visa.

And I think you already put a down payment on. Freiburg, how was your week? What how's everything going on at Valhalla? You you having a productive week? As one of my management team members told me today, it's a very complex business.

That's usually not a good sign when the conversation starts with that. Is that a way of saying everything's No. No. We we we were good. I was on the road this week.

I just got back. I mean, it's hard. Running a business is hard. You hire the smartest people you know, and what happens? They bring you all the problems they can't solve.

So it's it's never easy. We've got an incredible docket today. Let's just start with I'll give you a quick recap, boys, of the week since we last taped To say the zone was flooded, in the words of Steve Bannon, would be an understatement. Here's your Trump tsunami for the week. Thursday, when we taped the Epstein file dump fiasco.

You remember that, Joe. Right? Big zero, big nothing burger. Then Friday, Zelensky was dressed down and kicked out of the White House by the vice president and presidents. Markets collapsed.

They rebounded. On Saturday, we got a beautiful day off. Video of Trump dancing down a catwalk to YMCA. Maybe he played some golf. He was at the White House South, Mar A Lago.

Sunday, 09:24AM eastern, the president pumps three specific cryptos, Solana, Cardona, XRP to be in the first government strategic crypto reserve. Joe Lonsdale starts tweeting. I start tweeting. Everybody's tweeting. He quickly retweeted himself, included Ethereum and Bitcoin, some decentralized coins.

Reaction was, wow, crazy. You had a little bit of a spicy take, Joe. We'll get into that later. And I'm sure our friend David Sachs will have much to say in the second half of the program. But it was pretty negative.

Cardona ripped 70%. XRP, thirty two %. Solana, twenty five %. And then there was this crazy trade. One whale went 50 times long on BTC and ETH, 2 hundred million dollar position on just a $4,000,000 investment.

Everybody trying to figure out who that was. I'll leave it to you to speculate. Then we start the week. Monday, Trump says significant tariffs with Canada and Mexico, the market collapse. He walks back tariffs couple of hours later, and the market starts to rebound.

Then at 02:38PM, Trump announces a hundred billion dollar investment from TSMC in American fabs. Huzzah for that. And our boy, David Sacks, gets dragged out to the podium for a quick fifteen second cameo. Very nicely done to our boy, David Sacks. And then Tuesday, we have the most chaotic State of the Union I've ever seen.

Highlights include an angry man shaking a cane and getting kicked out. There were some auction paddles from the libs. I don't know what they were bidding on. There were 13 Biden mentions and one Pocahontas. Wednesday, we have news that the Doge blitz might slow down.

Supreme Court chimed in with a five four decision backing the federal judge who ordered the Trump admin to pay out 2,000,000,000 for USA Contractors. Then there was a closed door meeting with the Senate, with Elon. Maybe they discussed an approval process, maybe some voting type things. And then here we are today, Thursday, when we're taping. Markets down 2% on more tariff news.

Breaking news drops at 11:30. Trump announced tariffs are off for Mexico. Markets aren't rebounding. We might be leaving NATO. Can I Hold on?

I'm almost there. Yeah. Breaking. We might be leaving NATO. Breaking.

We're shutting down the Department of Education, Psych. We just found out we're not. Okay, gentlemen. That's the weird that was. No.

There's there's three things that are also kind of interwoven in all of this. OpenAI dropped GPT four five, and I think it was not really that well received. I didn't even know. Nobody's talking about that. Quen, which is the open source Alibaba, dropped Rev, which seems actually really best in class.

So that was really interesting. Okay. Then there was a story that said, Llama is going sideways. Facebook's open source L and M. Yeah.

And then the markets have just been going, I think, the craziest I've actually seen in twenty years of following the markets. And, specifically, you're seeing the Mag seven compressed towards the rest of the S and P 500, and then you're seeing this insane trade away from Europe. So there's a ton that happened this week. I mean Yeah. I don't remember a more eventful week, Joe.

Is this a little too much maybe? You guys missed the Shalom Hamas tweet by Trump too, which for a lot of us is a big deal. He said, I don't know if this is hello or goodbye, but he's threatening them really strongly. So for people who care about that part of the world, it's interesting to watch what's gonna happen. So that also happened.

Yeah. Oh my lord. Well, and Shalom is hello and goodbye. Right? Just to clarify, as a word, you would say both.

Right? Shut up. Yeah. It's ambiguous. And and peace.

Inviguous word. And peace. Well, maybe he's leaving it into interpretation. Maybe they get to pick. Maybe it's hello.

No. That's what that's what he wrote in the tweet. Oh, he did? Yeah. It's your choice.

Okay. It's a choose your own adventure, Hamas, from the president of The United States. But I think we should probably get into tariffs. This is confounding to most people. Maybe since I just did the whole rundown, I won't go into all the details about tariffs again.

But just looking at it from first principles, Joe, I asked a couple of group chats. You're in one one of them, in fact. And I have about, I would say, about 400 people total in these four group chats. What's the strategy here? What do you think Trump is trying to accomplish?

And, man, I got a range of answers. Let me ask you. What is Trump, in your estimation, trying to accomplish with the tariffs on, the tariffs off, the tariffs ons, the tariffs offs? As Chamath said here, this is creating more chaos than any of us have ever seen in markets. Listen.

Trump's negotiating. Right? So I I actually ran into David Sachs. Each senator gets one guest. We were both guests in the Senate dining hall, hanging out with a bunch of these guys.

Multiple of the guests, some of them were spouses of the senators, multiple of the guests were people who had lost kids to fentanyl. Right? And so it's actually it's a very serious issue. It's a big thing on the populist right as it should be for all Americans. We've lost, you know, tens of thousands of young people recently to fentanyl.

And and and Canada has done nothing about their border. And so, you know, you just reported breaking news. I hadn't even heard yet that Mexico might be off. Canada's still on. He's using this to negotiate.

So I talked to the senators and I asked him what's going on because obviously I import things all over the place. I'd like to know what the hell the rules are. But he wants people to actually crack down on this stuff and save American lives. And I think it's a reasonable thing to use to negotiate and force them to do that. Okay.

So you believe it's negotiation because of the fentanyl issue. Chamath, let me go to you because many people are saying this has more to do with some great reset and maybe the ten year. Do you think this is about fentanyl at the border or something else? I think that this is the first week where I've seen the first real schism in how people are interpreting what's actually happening. I think that Trump and Elon were very much in a honeymoon period until this week, and I think there was the benefit of the doubt.

But what I saw on X was a real divergence where on the one hand, there were people that were basically saying, Doge is deranged, Elon is crazy, Trump is lighting the world on fire in one camp. Yeah. And the other camp saying he's sticking to the plan. And when I thought about this a little bit, if you went back to November, I do think it's important to remember that we were at this moment where you had this fork in the road and you had all these important issues where I think the best way to generalize it was that the Democrats believed that the lines should continue to be blurred. So whether that was on gender or race or merit versus some other immutable trait or fiscal and monetary policy, things were just getting more and more blurred.

And then Trump and Elon basically showed up and said, actually, we want to refocus and we wanna make the lines very visible and clear on all those dimensions. And a majority of Americans voted that in. But I think what you're starting to see now is the difficulty in actually implementing that plan. And what I mean specifically is tariffs are very nuanced and complicated. On the one hand, there's the short term wins.

There's these impacts. You could deem them positive or negative to the dollar. There's impacts to US bonds. There's impacts to US bond markets. There's impacts to how countries deal with foreign reserves.

And then there's this impact that happens when the markets react to a tariff and then Trump takes that off the table and then they snap back. So you have this weird set of boundary conditions right now. So I think right now we're in the very difficult part of sorting through what the long term implications are. And I can get to some of them later, but I think that's where we are. I think it's really interesting.

The goal of tariffs in your mind for Trump is fentanyl? No. Finance related? No. No.

No. It's Give me your definitive what you think this is about. I think what tariffs allow us to do is rebase the long term reliance on the US dollar. It allows us to rebase our ability to fund our own deficits, and it allows us to rebase the long term ability for American companies to be economically vibrant. Okay.

So Freeburg, we got one person with fentanyl at the border negotiating. We got one person on trade. Some portion of this I hear, and I when I asked in these four group chats, I got, he's throwing stuff at the wall, the border. He's trolling the ten year note, And he doesn't care about stocks. And then I got onshoring and manufacturing as a possibility.

We're gonna make it more expensive to bring things in. So why don't you consider making stuff here? Do you think that third possibility is what's going on here? Does David Freiburg pick one of these three choices or another? What's going on here with tariffs specifically?

I don't sit inside of Trump's head, and I don't have any direct line of communication to folks that are constructing the theory and the policy. If I were to say, what's the most masterful plan in an optimistic way of what could be going on here? What's the master plan? I would kind of craft it as follows. Tariffs aren't being done in isolation.

They're being done along with a coordinated policy effort to reduce income taxes and another policy effort to reduce government spending. So those are three actions, three legs on a stool. So tariffs Mhmm. Reduced income taxes, reduced government spending. And they are related to each other.

They're related to each other because if we increase tariffs, one element of that is that to import product is more expensive. For example, I buy LED lights in my greenhouse. And the price of the LED lights just went up by 25%. This week, I actually spoke with the CEO of an LED company and I was like, why don't you guys make the LEDs here? And there starts to become a crossover point where it actually makes economic sense for the company to make the LEDs here instead of sourcing them from Asia.

And there's a hundred thousand examples of this. When the industrial supply chain goes to the lowest part of production, it's gonna end up offshoring when there's no tariffs. And if there are tariffs, then you start to do production here. So you're increasing both kind of security for The US supply chain but also increasing demand and creation of a workforce. Now I think that the income tax piece is critical here because in order to make the capital available to build that industry here, we need to unleash capital.

And reducing of income taxes, the economic theory would be, that capital will now flow into these entrepreneurial activity, these opportunities that have emerged where suddenly it makes sense for me to make textiles, to make metals, to make materials, to make cars, to make all the stuff here in The United States that I otherwise wouldn't be making. So both the corporate and the personal income tax, by reducing it unleashes capital. Then instead of going into the government, it now goes into the private sector into building businesses. Okay. I think that there's another theory about this, which is as you drop the income tax, one of the kinda key theories that I've heard spoken about a lot lately, and I think we're gonna hear about it a lot more this year, is trying to get The United States to move away from an income taxation model to a consumption taxation model.

So effectively, what the tariffs do is there's a tax for you buying certain things. So now instead of getting taxed when you earn money as an individual, you get taxed when you spend money. And some people think that that's both a more fair system and a more kind of economically vibrant system because that will drive investment in the things that people want to to produce because the money's going into production. So Do you think that do you think that, Friedberg? I'm curious.

I I don't know. It's a really interesting economic theory. I mean, I am not opposed to seeing some sort of an experiment play out where we look at a shift from income taxation to consumption taxation and see if it actually does have an effect on economic growth and productivity. It has not been done in a hundred and fifty years. There's a lot of economic theorists on both sides of the equation saying this does work or it doesn't work.

Okay. And let me just say one last thing. By reducing government spending, we are moving workers from the government into the private workforce. So as those new industries pop up, as those investments start to get made in building new industry onshore, where are the workers gonna come from? Remember, the government's 30% of The US GDP today.

So if that's not a great way to invest money, maybe the private industry is better at investing money and employing people that will unleash the workforce, and it will counterbalance the inflation that we're experiencing. So there's a lot of inflation because of tariffs. And by reducing government spending, that's the offset to inflation. So those three actions, I think, are three legs of a stool, and they actually are all interrelated to one another. So that would be my grand master theory of what might be going on.

This is an interesting triangulation theory that people have been speculating about. And there are a couple of caveats here, Joe. Number one, we do have lowering income tax and lowering services experiment. It's called Florida, Texas, and a couple of the states where they have lower income tax and more consumption tax. We pay a lot more in real estate taxes here, something we consume.

Putting that aside, the really interesting issue is we're at the lowest unemployment of our lifetime, 4%. Where are all these workers gonna come from? What do you think, Joe, now that you've heard the two other panelists here discuss it? What are we trying to get to? Where is the destination?

At the end of this term, Trump's lame duck. He can go wild here. He's not running for reelection. And, you know, what what do you think he wants to see? Do you think he just wants to cement some sort of legacy?

And if so, what's that legacy, and how do these actions equal his goals and legacy? No. Listen. I agree with what David with what David was saying, Jason. And and it's it's a really important point also that we should mention is that the last four years, the economy's looked okay, but part of that is because government's been hiring like mad.

And so the point he made is that actually, you know, having twice as many people, you know, harassing me. I just got back yesterday. No action on an audit that they've been harassing me on for three years. They found nothing. Having twice as many people doing things like that and and or, like, you know, running TSA or pushing papers around in the Department of Labor, doesn't actually add output to the economy.

And so, you know, it it does seem like it makes a lot of sense. Let's take a million workers out of the consulting class around D's DC, out of the, you know, paper pusher class around DC, and let's actually deploy them to the actual productive economy. Elon and Trump have both been saying that. I think David's a % right. It is true.

A lot of my companies, thanks to the tariff stuff, are looking to build stuff here. So I'm not a huge fan of tariffs personally, but this they definitely make sense for things in defense. They definitely make sense for negotiating with countries. And it is true. It is pushing certain people to including me to build some more things in America.

Here's where tariffs make a lot of sense. If you have markets where there are domestic alternatives and or where things are fundamentally commodity, there's no reason why tariffs can't work to create the incentives to redomicile economic productivity inside of The United States. That's a that's a slam dunk, I think. And and, Shamath, there's another twist on that too, which I think we should all acknowledge is that America does have some really tough environmental laws. Despite what Jason may think of me, I actually don't want my daughters growing up with, you know, messy air, messy water, you know, screwed up country.

Oh, I'm sorry. I'm sorry. I know that you're a nature guy. But here's where We're like a classic bush nature guy. But but here's here's the thing.

In China and Indonesia and all these other countries, they are just over the environment as they make things. I think tariffs are very reasonable on that case. Like, it's not fair to make it more expensive for us because we're doing it well, and then we outsource it for them to destroy things. Right? So so there are some things there where it does make sense.

And and what I would say is the other the other side of the of the tariff knife is that if there are markets though where you're making something that's fundamentally innovative, where you are but one maker, the problematic part of where tariffs really affect The US consumer is then the price of that product of which there are no competitive alternatives can go very, very high. And that's inflationary. And I think that that slows down consumption. And then if if that consumption is not just of something that's a nice to have, but a must have, then it becomes problematic. And so you could see where tariffs could impact certain industries.

For example, if there are innovative drugs, I think that that's problematic. If there are innovative technologies of which there's only one vendor, that's problematic. So all of those need to get sorted out. But on balance in commodity markets, like look at autos. Autos is a perfect example.

There are so many purveyors and providers of autos. There's OEMs all around the world. And so to have a compensatory system doesn't seem like an unreasonable thing where it's a tit for tat tariff. But in other markets where if you need, for example, a specific piece of equipment from ASML to build a chip, and now all of a sudden that that machine is 25% more expensive or 30% more expensive, and they pass that cost downstream, it becomes very speculative and it becomes a little bit more fragile, I think. This is dangerous though, right, Shamath?

Because I agree with you in theory, but then there's something where, you know, if everyone's lobbying for their thing to be an exception, you end up getting this very crony system that's that you don't necessarily want. Right? So you have to be very careful how you define these things. Exactly. So this is why the I think, like, sector by sector, it's probably you can probably go and pass the smell test and say, if there are multiple providers and or if it's somehow commodity.

I think it's easier to absorb the tariff in the short term. Maybe that's the right way to say it, which is if you believe if Trump believes everything should be tariffed, then instead of debating if, to your point, maybe the right thing to debate is when. And you have to put some things on a much longer glide path so that you don't just create inflation out of nowhere and or you don't hold back American business or American consumers. Well, this is a key point because you do need to have predictability to make investment and reciprocity. So really two important points Chamath's making here.

One on reciprocity. These things haven't been looked at for a while. I'm not sure how they got so out of whack, but just putting some facts to this, Chamath's exactly correct. We get placed when we send cars to the EU, they get a 10% tariff. But when we get their cars, it's a two and a half percent tariff.

Who let it get out of whack? I'm not sure. But why not make the reciprocity perfect and just, Hey, you say 10, we say 10. You say two and a half, we say two and a half. And that would make, I think, a lot more sense just to put some numbers here on government employees.

It's not as bad as people make it out to be. A lot of our spending is non employee related but it is, if you look over the last two administrations, we have added million two, million three employees across all. I disagree. And that hold on. Let me just finish the sentence so you have the facts and then you can disagree with the facts.

1,300,000 additional employees added. This does not include contractors. And so we don't know what USA was doing with NGOs and contractors. And I think that's where we do need to get some clarity. And to Chamath's point, this has all gotta become predictable.

You cannot put tariffs on off every week or else how does your friend Dave who wants to do the LED lighting or you're encouraging to do it LED lighting know if they should build a factory and invest 10,000,000 in that? You disagree with the number of employees. You wanna address that? Yeah. Look.

Okay. Go ahead. The the government accounts for 30% of GDP in The United States. That's an extraordinary sum. So just Yeah.

I was talking just about the employees. That's a much smaller percentage. But that doesn't matter. The direct employees of federal agencies is a fraction of people that are employed indirectly by government spending. This is super important.

Sure. Because as we all know, many government agencies write checks to large contractors, subcontractors, and third party service providers that do the work for them. So the money gets transferred. They then employ the people, and they do the work. So it doesn't technically show up on federal government payroll registers, but these are people that are indirectly employed by federal spending.

That's super important to to acknowledge that a large percentage of The US workforce is indirectly supported by federal dollars. Yeah. And it's gone up it's gone up massively with the NGOs too. So you have about 4,000,000 people employed by contractors in DC, One Point Six Million more at the states actually by federal by federal spending, And then you have the NGOs. No one knows the NGOs.

Biden administration took down the data I used to see things in 2020, so we don't even know how much money, but we know it was hundreds of billions. And so it's pretty crazy. The number one thing about how DOGE is not being done fully is that Elon is doing an amazing job, you know, whether or not he cuts 500,000,000,000 or trillion or a lot more. But the senators and the congressmen are not willing to take it out of their bill. The reconciliation bill right now, they're talking about cutting 1 to 2,000,000,000,000.

So rather than like, this is over ten years. It's ridiculous. It's ridiculous. If it was equal to what Elon was doing, it'd be at least $5,000,000,000,000. And I push a bunch of them, and they say, oh, the congressional budget office and all these things.

And I'm sure there's some tough things there, but, like, this is crazy. We need to see what these cuts need to be on DOGE, and we need to cut 5,000,000,000,000. And none of these people have the balls to do that. It's not the political will to do it is my interpretation. And and and just just just cojones.

Let me just show you one chart to back that up. I have my new discraciad.com for the week. Look at this, Chama. We wanna talk about software and waste. 35,855, according to Doge, breaking news, ServiceNow licenses on three products only being used by 84 people.

Oh my god. Are you kidding me? 11,000 Acrobat licenses with zero point zero users. Absolutely abhorrent. And I'm saying it right now.

I want an investigation into procurement. Who sold this? Who bought it? This could be a crime. This could be fraud.

There could be kickbacks. I'm saying it could be. I don't think it's that. Number two. But I do think you have to look at the earnings of these companies and question where's all of it.

Totally correct. Number two. Totally correct. If ServiceNow ever wants to work with the government again, Mr. President, Mr.

President, our president, I want them to pay us back for the unused licenses and I want a full order for those last ten years. If they don't pay us back that money and give us a credit Hold on, hold on. Listen Banned forever. Hold on. It's not Thank you, Mr.

President. This may not be ServiceNow's fault. This may be the ineptitude of the people that bought the license. Of course, but they should still give us a credit. I want the money back to the American people.

I do think Adobe has the worst. Have you guys ever done Adobe subscriptions? They're impossible to cancel. I think Adobe Eleven thousand euros per hour users. The only thing harder than canceling an Adobe license is trying to cancel Wall Street Journal.

I was about to say Wall Street Journal. That's the worst. Wall Street. Wall Street. Wall Street.

Wall Street. Wall Street. Wall Street. Wall Street. I'll just say it again at the sake of being redundant.

We're getting to the phase where the details are complicated and they now matter. So we've talked about repealing the IRA in its totality. Right? So that was a statement and there's, there's theoretically a lot of money there. But the details now all of a sudden become complicated.

FERC published a report just this past week. And what do you think it said was the percentage of incremental electricity that was generated from renewables versus non renewables? I'll I'll tell you the answer. It was almost 91% in December. So if you now tie two huge initiatives together, which is how do we find a budget that saves money and how do we continue to win an AI?

Maybe you would have thought those weren't related. Well, guess what? We know that AI needs a tremendous amount of power. And whatever you thought you knew actually, you had to re underwrite because what Elon has shown is actually you need to now create these mega clusters, hundred thousand GPU's going to a million GPU's. All of the power forecasting that we have is miscast.

It doesn't even account for this, number one. Number two, there are 35,000 applications into FERC to get approved to generate electricity. 35,000. That's gonna meander through some administrative rigmarole. There is a five year delay to get a gas turbine into America and online.

Okay. If you ordered one today, the fastest that you can get it turned on is 2,030. The fastest that you can get nuclear turned on is 2,035. So we don't have the ability to generate incremental electricity very quickly, but for renewables. But then if you rip out the IRA, there's many parts of the IRA by the way that are just trash.

Nick, I don't know if you can find it, but Barry Weiss found this insane thing that made me so angry, which I'm happy to talk about, which was like a thirty day grant process that resulted in a $7,000,000,000 grant to some shell engine. Oh, this was thrown the gold bars off the castle over the last day. But the other part of the IRA, this narrow part is what it did to reinforce tax incentives and tax equity, which is a $200,000,000,000 market that incentivizes that 90% of energy generation. So my point is that when you start to get into the details, when the House Ways and Means Committee has to figure out what part to put back, this is gonna be hard because it's like, hold on, if you got the whole thing, now all of a sudden you take 90% of the incremental energy generation incentives out of the market, you don't have enough electrons. There isn't enough electricity.

So then you lose the AI race. So you start to lose it. I think the point is that we're now in the hard part where the details really matter. Listen, you gotta start with the chainsaw. We saw that at Twitter.

And by the way Trump just tweeted it, maybe you do like When we started this, he just tweeted this out. He said, guys, now it's time to get surgical. He then he said this. Perfect. Yes.

That was the metaphor I was about to use. It's like, you know, you start with you cut out the goddamn ServiceNow and Adobe subscriptions and then you work on something, you know, more depth and maybe that's where we are. IRA just for the audience inflation reduction. Can I just do a rant on this, on this pop up NGO thing? To me, this is like the worst of America and it makes me so angry and I'll tell you my lived experience.

So I'm on the other side of this. I started a company with these guys from Tesla to make battery materials in The United States in 02/2019. We grind, we grind, we put in tens, I put in tens of millions of dollars. We get a deal with a big OEM and then you see these DOE grants. We spent millions of dollars.

We file a very detailed plan to build battery metals and battery capacity in America. We got rejected. Okay. It was an entire year long process. We got rejected.

We put it past us. We kept working. We found more deals. We found a way to survive, raise a little bit more money. And then we applied again on some success and we got a hundred million dollar grant.

Okay? That was that's what just happened this year. But then yesterday I read, and Nick, maybe you can throw this tweet up, this Barry Weiss investigation. Somebody in thirty days who was connected to the democratic infrastructure had some shell organization that got a grant that was 70 times bigger than us. Like, we've made stuff.

We have deals with OEMs. We had to validate it every step of the way. We were rejected once. So our process to get a hundred million dollar DOE program was two years. These people showed up in thirty days and got 7,000,000,000.

That's just Woah. Why didn't you put why didn't you lead with DEI or something? You would've gotten a billion. You just led with the wrong thing. You were actually providing a product or service people's need.

This is this this is why they're You don't have equity in there for the minerals? This is why it's so frustrating to build for the government, guys. This is what Palantir and SpaceX had to deal with. That's why they both sued the government is that all the friends who used to be the CIO, used to be the general, made the right donations, had the right kid on the board. It's all corrupt.

And then it's actual substantive people. You have to work like hell. Give $7,000,000,000 in thirty days. Actually, they're gonna we're gonna find out. You got a bunch of democratic operatives on the board.

Let me well, let me challenge you guys on one point. There are now claims being made by reporters and by third parties that are saying it is a new form of kleptocracy with all the friends of Silicon Valley installing their friends and agency heads as undersecretaries and so on that's gonna benefit Silicon Valley Investors, Silicon Valley companies. Joe, Chamath, JKEL. I mean, how do you guys react to the claims that there's now, you know, this new kind of kleptocratic movement? It's the old guard is gone.

Now there's a new guard. You have Palantir. You have Andrew. So go ahead. You you answer, Joe.

Let's let's talk about this. I mean, when we go to DC, when I go to DC, what I am asking is I want there to be a fair competition. And if I win, I want my company to actually be able to win the contract because the way it's worked for twenty years. Like like EPRIS, you could just raise $250,000,000 this week. It's a great company.

We, you know, we had a big contest four years ago, l three, Raytheon, Northrop. These guys, you know, in and out of government for decades. They've they've gotten tens of billions of dollars to the same technology area. When we went head to head with them, we we didn't just, like, beat them by a little bit. We shot down the hardened drones nine and a half times farther away.

Same size, same power. Nine and a half times. Completely wiped the floor. What was the cost difference between the bids? Like, are you saving us massive money?

Massive money. I I invested only $30.40 in the whole thing at that point, and they spent billions, and we have much cheaper, much better, not even a question. And and you talk to the and you talk to, like, at the time, the the chief of staff of the air force, the guy who wrote the four star, and and he says, well, Joe, this was written three years ago. It looks like Raytheon probably did help write it, and they required all these things. And your way you're doing it, I'm like, I'm like, yeah.

I'm using a chip instead of a cathode ray tube. That's why it's working so much better. It's like, yeah. But it was written for the way they're doing it. And I could overrule it, but it break a lot of glass.

So you probably wouldn't get in three years because everyone knows you're the best. But it's too it's too, you know, too stressful to give it to you right now. Like, that is that so so so what I'm doing is I'm not going and saying give my companies money. I'm saying I'm saying make this actually a functional logical process and give me a chance to win it from the best. So that that is a hundred times better for our country to put it in the right way.

But how do you make that transparent? And how do you avoid Yeah. There has to be massive transparency. How do you avoid the the perception of kleptocracy? Well, it's acquisition it's acquisition reform.

Right? So, like, this is this is a really important story. You guys probably know. We were in the Philippine jungles in the early nineteen tens, needed new pistols. Our pistols were terrible.

They had like a one page thing what they needed. There's six arm manufacturers competing. That's how we got the Colt nineteen eleven in like three months. It won by the by by a large amount. It's an awesome gun.

At, twelve years ago, we had a 700 something page document that the bureaucrats spent years on outlining what they needed for a new pistol. I probably needed to do DEI stuff. I have no idea. It's, like, a long comical document. They still don't have a new pistol today.

And so the way the way we do it is we have a very clear process where it's very specific on the outcomes, not on the inputs, and you have a contest. And and then and then you make sure that, you know, it's not it's obvious who wins, guys. It's not like we're, like, slightly better. It's like we're shaming them. So the only way they can stop us is by playing these games because we're just so much better.

I think that if you're in the administration or if you join some part of the administration, whether you're a a full time employee or a GSE or just a volunteer, there's going to be that perception of impropriety or influence peddling. That's comes with the territory. So how do you avoid it? And I think that Joe is exactly right. When the administration was getting formed, one of the things that happened, I had an opportunity to work with some of the folks to write some proposals for what theoretically could happen in some of these bigger government organizations where there's just huge pockets of spend.

And where I spent most of my time is what Joe talked about. How do you create open standards so that it's very clear what the competition is? So that the rules on the ground can't get manipulated by people who are rolling out of government into private industry or somebody has a very deep relationship because of lobbying. Those are the things that pervert the clarity of what should happen because then what happens can be far afield of that. So number one is I think knowing that this time around, a different class of people are gonna be seen on the quote unquote popular side.

It's really critical that all of us that are involved in this promote extremely transparent open standards, publish every RFP, publish every spec, publish every evaluation criteria, make these things as mechanistic as possible. So for example, if you're gonna go and field a drone, there's an incredibly detailed set of data that you should be publishing in. It's not dissimilar to how an FAA asks for flight test data, and you should be able to review that so that then it can be escalated. So that if somebody then gets a deal because of preference and you think you're structurally better on the data, there needs to be an escalation and a release valve that says, hold on, this is just being manipulated. And And I think that's how you fight back on not just this version of a potential winning side versus losing side, but forever in the future.

The government should be open. The government should be transparent. And every single point at which they're making a decision and giving money should be measurable and known. You guys got exactly right. There's transparency.

There's oversight obviously, but there's whistleblowers as well. And there's the role of the press in all of this to sort of fact check it and to check-in on it as a safeguard with the public getting engaged. And that's one of the great things that Doge has done. By having a Twitter handle, I can pull up, hey. Here's what's going on with these licenses and make an example.

So that kind of transparency helps. And then finally, we have to look at campaign finance. That is where a lot of the appearance Hold on. Proprietary exists. Go back to this other thing because that's a super important point.

Like it just occurred to me that if what you said happens, then look, the incentive today in America is to try to position oneself to have one of these roles. And the reason is because David of what you said, there is the chance to then preferentially nudge an opportunity your way. Right? Why do people sit on committees? Why do people volunteer?

At least at that level. And if you introduce open standards, then the real incentive to want to go do this should be because you actually are patriotic and wanna just help. So Chamath, I think I think you're right about the standards, but I wanna push back on the incentive today. Like, I know a lot of the people who are getting into this, and I really do think they're there to fight for the country. I I don't say this like as like, you know, naively or something.

Like, these people really are there for the right reasons for the most part. No. I know. I'm just saying generally over, like, the last fifty years, if you look at people, there is this implied sense. Like, for example, like, Goldman Sachs had a direct line to become treasury secretary.

If you were the CEO of Goldman, you you were the treasury secretary. Now don't you think that that was discussed amongst partners at Goldman? And do we not think on the margins that that beneficially helped Goldman? Of course, it did. We'd be we'd be naive to think otherwise.

My my point is not that. My point is just that going forward, the best thing all of our friends could do is just make it all open source and open standards. Yeah. That would be an incredible artifact I think for America. Joe, I think you telling us, hey, I trust these people, they're our friends.

You know, that works with all of us because yes, we know them. We know they're gonna do the stand up right thing. And if you already have a ton of money like some incremental amount of money is not going to move the needle for you. It's it's it's farcical for us to think that David Sachs is gonna give up four years of income producing, have to sell all his positions, and that is in some way good for his balance sheet. It is not.

He's gonna miss out on four years of AI and the massive run up of our lifetime in order to serve the country. But I can tell you people don't believe that just like, you know, you talked about the kleptocracy and the revolving door to Raytheon or whoever that people have talked about forever. What you need is whistleblower protections, journalists going after this like Barry Weiss is doing, old school journalism investigative. The whistleblower laws are great in our country. We need to keep reinforcing those, but I'm gonna go back to we need to limit campaign contributions.

We have to get rid of super PACs because these create the appearance of impropriety. And the appearance of impropriety with Trump's meme coin and that announcement on Sunday for the crypto reserve was, you know, it doesn't help the mission here that Trump is trying to get done. So maybe you could speak to that because that's where the appearance of impropriety is great. You got people like Saylor who's doing his Bitcoin thing. He's going on Friday, and, you know, Sachs will do a do a little bit here and announce some stuff on the program, hopefully.

But maybe you could talk about what you objected to with the coins, the meme coin and or the the announcement of the crypto reserve. Should our government And after all these donations from massive people, like, I saw at the crypto ball, all the people who were tweeted by Trump, that looks terrible. You tell me what to think. I agree with you on that tweet. You're sneaking two things together here though.

So I wanna be really precise, Jason, because Let's be precise. That's what we do here. There are a lot of different possible ways that people can help politicians. And so one of them is if you're a celebrity, like, even all your guys show at this point, you can you can actually affect what people think. That's totally powerful.

Same word. There's other ways that if you're part of a big union, if you're part of a government union, that's very powerful influence in our society. If you're part of American Medical Association healthcare system, the doctors and health systems are very powerful even without super PACs in our society. And what a super PAC is, it's a form of free speech. And it's true.

Wealthy people have the ability to influence things through that speech, but it's like one of many. And so if you're cutting that, you're basically saying, okay. I don't want Elon and Joe to have as much say there, but I do wanna have even more say for the celebrities and for the doctors and for the union members and government. So you have to realize you're dealing with a complicated situation with lots of forms of power. I do agree with you.

As I said and listen. I saw David and we gave each other a hug. I think we're all good. But I was very frustrated with, posts of Trump mentioning specific coins. I don't know who was trading them before.

It just looks bad. Like, we're finding all this grift. We're doing all these things where we have the moral high ground. I agree. I don't wanna give up the moral high ground with these with these silly schemes.

That that that's a % the case. Are you saying with, like, there's many forms of influence that you think super packs and rich people should be able to I think speech is important. $50,000,000 20 million dollar donations. You'd actually think that's fair for democracy in a different way? I actually I actually think speech is very important.

I think the ability for me to send out something and say, guys, I'm studying this. It's corrupt. It's been corrupt for fifty years. We have to all get together and stand against these health systems, these crazy defense companies that have captured and broken everything. Like, I I think my ability to speak and do that and to convince people is really valuable.

And I and I've, you know, I passed dozens of laws each year in these different states by convincing people, nothing to do with making me money, that these incentives and accountability are wrong. I think that's a good thing that I'm allowed to do that. I think that's a good thing that I'm allowed to do that. I think that's a good thing. So when you say speech, you mean write a check?

You mean write It's not it's not very large checks. You have to be careful. That's the reason the Supreme Court ruled for super PACs is not just about giving you're not you're not giving them the money. You're actually speaking yourself. So when Elon spends $300,000,000, he's actually spending it many times putting out his own speech or he's putting out a speech to people to go.

So you really need to know what about you, Chamath? Do you think that Soros, Elon let's take the names out of it. Do you think there should be a cap on what you're able to donate to Super PACs? Because this does create the massive appearance of impropriety, whether it's in crypto, whether it's on the Soros on the Democrat side. This seems to be I mean, I'm in favor of there being more hard caps, whether it's $5.10, or 25,000,000.

I think there needs to be caps. And I think we should put a fund together for the last two or three people and let them get that money from the government to run their campaigns like other countries do. I think it's important to note that this pendulum has swung pretty wildly out of whack since Citizens United. Yeah. And it's not this is not a Republican thing, meaning there's a whole bunch of factions.

There's the George Soros faction. That's true. There's the liberal Democrat faction. Lest we forget, I think Zuck spent 350,000,000 in 2020. Oh, yeah.

Then there's the Koch brothers faction. And then there's what showed up this year with Elon. So my point is there's all kinds of pockets of spending in all manner of ways. I think the question is, should Citizens United have allowed this kind of spending? And are we better off as a democracy for it?

And I think What does Chamath think? The reason why I would be in favor of going back to the way it was is that I think the biggest problem is the redistricting and the gerrymandering that happens and the amount of influence that happens downstream inside of state and local elections. And there are just places that are just so sclerotically stuck. If you look at the federal, despite all the spending, you still see at the presidential level, like pretty reasonable and healthy competition between two people. It's much more difficult to see dynamism lower and lower down ballot.

And so the reason to get rid of Citizens United from my perspective is that you'd have much more vibrant local state mayoral elections. Those things have huge impacts I think to to quality data. So you and I are in that camp, Joe's in the other. Freeberg, your thoughts, you're the deciding vote here. It's two to one in terms of the panel.

It's two to one. It's two to one. Two to one. Well, you just said to me you think we should go back to way one. This is the Supreme Court's on my side so you guys are in trouble.

Exactly. Yeah. I mean, but the point of this program sometimes is not just to is to take ownership of your opinion and defend it. So I A %. We have I I wanna see people own it here in the discourse or, Freeberg, you can say pass, but you don't get to say nothing.

Okay. What does it mean to spend money on a political point of view? Exactly. What does it mean? It it means you can put a book.

I mean, the other side wanted to censor books. That's something like like if I wanna if I wanna pay someone to make a book for me, if I wanna pay someone if I wanna pay 50 people to go and engage the community so I can get some leverage on my time. If I wanna pay someone to make a website to promote my point of view on something, I should be able to do that. And if my point of view is related to a vote that congress might be taking or is related to a candidate that's running for election or is related to taxes or is related to some other social issue. I don't know how you can kind of very clearly delineate the difference between some kind of political party or some political candidate versus my having a point of view on an issue.

If I care very deeply about animal welfare, which I do, and if I had enough money that I felt like I could spend that money to influence people's point of view to improve animal welfare through laws and through candidates, I would spend that money. And I should have a right to do so. And I shouldn't feel restricted that I can't go publicly express my voice, make websites, put up billboards, put up posters, buy ads in papers telling people how wrong it is the way we treat animals and slaughter them and keep them living for their very short lives in terrorist conditions. I wanna be able to express that point of view. And so I veered to this idea of like Can I ask you a question?

Do you think that your money spending, if the balance of power to get your view was to redistrict certain places so that then you could get a majority of people that were ideologically aligned to you elected. Would you do that as well? Forget There's no ads running. This is about a different form of electoral influence. Would you do that?

So not spending money you're saying? Like I'm not spending money to No, you'd spend money, but it's not for ads. It's not for those sorts. How do you spend money to redistrict? You get certain people elected by trucking people out to vote and then you get that person to join a coalition that then redistricts.

I mean, maybe trucking people out to vote as an action should be illegal. That seems pretty reasonable to me. Well, yeah. I mean, to your point, Fribourg, you asked like, how do you define it? What I'm trying to point out to you is for every dollar that goes into politics, I think it's, I would ask you guys to just suspend belief that a % of that goes to ads, man.

Or what I'm trying to say is Yeah, I hear you. I would say a very small, not a very small $10.10, 10 to 20¢ goes to ads. 80% goes to all kinds of shady stuff. And this also can be seen. By the way, you call it shady, but I would argue like what if I wanna make a bunch of websites?

What if I wanna make, like, you know, have people go out and express a point of view in the town square? You know, like, there are other aspects of what you might What I'm saying is that's fine. That's in the 10¢ bucket. The 80¢, what I'm trying to tell you explicitly is how it's spent today is not in the ways that you think. I think that the fact that someone calls it shady might be because they disagree with my point of view.

And if they agree with my point of view, they might not call it shady. I think, I think the tactics today, look, I play with the conditions on the field, but if you look at them, meaning like using dollar incentives to incentivize people, that's allowed today. You can pay people to vote today. Well, you can pay them to join a super PAC or something like that. But let, hold on.

Let me, let me just get Joe involved here. So Joe, you heard Freeburgs. You're kind of in alignment, I think, broadly. Yeah. But we can define some very specific things that are obviously political, like the window of when you spend the money.

Mhmm. Like Why? Telling peep well, because you could say in the six But what if I'm not targeting the election, hold on a specific vote? I get it. I get it.

If you're not if you're targeting an issue, that's one thing. But when you tell people she's for they, them, he's for you, that's clearly a political ad. Now you could take those ads. You could take canvassing. You could define a subset of behaviors, and you could say you can raise up to this amount of money per person in that way.

That to me, those things are explicitly political when you tell people this is about candidate a versus candidate b. If you were to say this, we're not gonna mention any candidates, but we're gonna talk about your puppies and you trying to increase your Q score here on the goddamn pod by saving puppies. Don't be animal welfare is a up issue and it's something that you should just dismiss with that. Agreeing with you. I just don't like how many points you're scoring with the audience over there.

Did you guys see this thing on Instagram? My wife showed it ridiculous. I'm gonna save five puppies for my ranch. Somebody save some cows. Did you guys see this Instagram reel?

My wife showed it to me. It's like of a of a calf chasing a dog. And it cuts to this Asian guy, and he's like, what's the big deal here? What are we talking about? Like, you know, you want us to not eat everything, blah blah blah.

And then he realizes that they're talking about the dog versus the the cats. Don't trigger Freeburg. Don't do that. Delete Freeburg. Freeburg, I got 33 acres of paradise.

Don't laugh. I got 33 acres of paradise. I'm gonna save every animal in in Central Texas. Go ahead, Jason. I'm gonna eat them.

And I and I would give you money to do that. Okay. Great. I got a deal. Actually, I I actually I agree with what Shabaugh was saying about gerrymandering.

I think we could use AI for that. It's a separate conversation. It's discussing how it works right now. However, Jason, the problem at the end of the day with defining what's political or not is the boundary cases are really tough, and you do end up needing effectively effectively a censorship board. Example is I write I write a book about the dangers of communism, and it explains how it's linked to things going on today.

And I, like, give it out at, like, all these people are gonna be voting. I mean, there's just so many boundary cases. Yeah. But if we just send money out spend up to 10,000,000 a year doing political activity. 10,000,000 a year gives you a cap.

So you can only buy so many books and buy so many hands. It's not political activity. It's my art. This is a this is an artistic piece of advice. But when you put the book in and say vote for Biden, then we would say, okay, you put a vote for Biden.

But so you just keep saying though, it becomes it becomes really complicated. I just ran it through Grok. And what the answer was is that 56 of all the spending happens to be on ads and 44% of all dollars in 2425 was spent on other. Yeah. Yeah.

So there's Well, so if you put canvassing in there, I bet you it's 75%. So if we just say for those two activities, put a hard cap on them, I would be for that. But let's just keep going. We got a question. I want to talk about them.

Eric Weiss (zero zero three:fifty): Market's Let's talk about Coreweave. Eric Weiss (zero zero three:fifty): All right. Gentlemen, we can't talk about politics all day, as exciting as it is. Let's talk about this Coreweave IPO. If you don't know, Coreweave is part of a new type of infrastructure provider called NeoCloud.

It's a fancy way of saying using GPUs to build data centers. This is a really interesting company because they got onto GPUs early, and they had a lock in on a large number of NVIDIA's GPUs. They've, got 32 data centers with 250,000 NVIDIA GPUs. As an example, when Elon built the largest, fastest, data center, Colossus, That was a hundred thousand. So this is, you know, really, really a big company.

They're going to do an IPO. Analysts are estimating they're going to raise at least 3,500,000,000.0 at over $30,000,000,000 Their secondary was 23,000,000,000 in November of twenty twenty four. So this is cooking with oil. They've got incredible revenue, by the way, 1,900,000,000.0 in 2024. But if you look at two years ago how much revenue they have, the growth is amazing.

Nick put a chart in here in post because it's like a 10 x, I think, each year or something crazy like that when I talked about it on the other pod. But they're very unprofitable, almost a billion dollars in loss in 2024, and that's interest payments on a lot of their debt. They have almost 8,000,000,000 in debt. Huge debt load to buy all these GPUs. And that has been the question we've been talking about here, Chamath, is are these GPUs, are these NeoClouds?

Fancy way of saying I'll give you Yeah. Couple of factoids about CoreMedia, which I find super impressive. So the first question is like, you would say, why didn't AWS, GCP, and Azure eat these guys for breakfast, lunch, and dinner? And as it turns out, they had one very specific technical decision that I think was extremely valuable, which is that these guys did not use hypervisors. Explain what that is.

So a hypervisor is basically a middleware layer of software that allows you to abstract units of compute so that then you can make them available. And instead they basically allowed you to write to the bare metal and this very native approach that allowed them to get a lot of traction. So it's a really interesting thing to note that just that simple thing, like one simple technical design decision can allow you to build what looks like at least from the revenue perspective, an incredible business. Right? So kudos to them.

Super awesome to see that you can still maneuver around the big giants. I think that that's cool. I think the big question with CoreWeave is, what is the period of amortization and the useful life of these GPUs from NVIDIA? And I think that that question is up in the air. As you said, Jason, a lot of their losses are these interest payments.

And as long as that they have that calculated right in their models that they used to borrow all this money to buy all these GPUs from NVIDIA, this is gonna be a killer business. To the extent that they got that calculation wrong. Meaning we felt the useful life was ten years, but it turned out to be five. This business is deeply underwater. So I think that that's the bet.

The bet is they've built an amount of headway. They're gonna continue to do this good technical engineering. But the other side of it is, is the useful life right? Is the technology curve right? Is Moore's law and all these other things, will they work in its favor or against it?

And I think that's the most of the And Joe, people say useful lifespan, GPUs, three to five years before the next generation is so much more powerful, especially in relation to power consumption that it's worth running it. Now with servers, old CPUs for running Facebook, it's a totally different story. You can keep those running five to seven years before it's not worth running and you have to turn them off. What do you think here about all these business? You're right.

There's an economic question question on the power and all these things. I actually know Brandon. He lives nearby me in my my house in Montana. He's a really smart guy. And I think the really interesting thing, you know, when they built this that I think is relevant going forward is these guys were commodities traders, and they were originally buying stuff to, like, mine Bitcoin and other stuff like that.

And and they realized as commodities traders, there's, like, a certain supply and demand in the market of GPU chips, but also of all the data centers, by the way. And it's a really it's really interesting what they did is they locked down the full supply of tons of data centers, tons of the power they needed, tons of the chips, and they're very, very thoughtful. I mean, they're effectively they're traders and they're and they're very economic, and they I think they have a lot of the stuff well. That explains a technical decision because they have to have very low latency throughput in order to transact efficiently as commodities traders. I'm guessing There is one Exactly.

Feliz Hill That's cool. Here for this company, Friedberg. They had massive revenue growth, but they have a dependency. 60% of the revenue now from Microsoft, and Microsoft seems to have done this either. It's unclear, but maybe to serve as the open at AI deal where they needed to give them a bunch of infrastructure or it might be for Azure.

It's unclear. People have been asking this question for a couple of years now. But what do you think of a business with one client with 60% dependents? And this is this is how these things work, Jason, is they just one client tends to grow really, really fast, and they they're actually you know? So they do this orchestration framework called Sunk.

I know a little bit about it. This is really easy for scheduling workflows and batches and all these things. So I think a lot of other people are using really well. They've just bought weights and biases, right, which, like, everyone uses, basically. Yeah.

That's great. It's a great buy. And they're killer. They're killer for training. I mean, I think these guys crush in training.

Satya Nadell said that Microsoft was doing this maybe not for a long term usage. So, Friedberg, your thoughts on CoreWeave? I'm not as deep as you guys are. I remember in 02/2003, I worked for nine months at a private equity firm, and I would cold call, like, companies that hadn't raised venture capital that were profitable and fast growing and see if they would take our money. That's the business model.

And I spent a lot of time in the sector of businesses that were called speed doublers. I don't know if you guys remember these companies. 02/2003 was before we all had broadband Internet. So we were a lot of people were using dial up, and you could pay $9.99 a month for a speed doubler. And what it would do is it would basically, on your browser, set the server to be their server, and they had a cache of many of the popular sites on the Internet.

So when you started browsing the Internet on your computer, everything loaded faster because they had really fast servers and you got these caches. And these companies, dude, they were doing, like, tens of millions of revenue, high margin, 50% plus EBITDA margin, and growing, like, a % plus a year. And I remember we we spent a bunch of time looking at these companies. This is be right before I joined Google. And I was like, this feels like a transitory business.

It's like an arbitrage between where we were and where we're going. And that's what ended up happening. Many of them just cash flowed out. The founders took money or they were able to get a really smart private equity recap done, get some money out and run at some low multiple of EBITDA or something. And so I worry a little bit about a business like this where there's four or five companies that are each doing $80,000,000,000 of CapEx this year to create infrastructure that effectively starts to replace what these guys are effectively offering out as a service.

That would be my biggest kind if I was to do diligence on this business, that's where I would spend a lot of my time is, like, guys, what's the capacity gonna be in a year or two? Sort of like when broadband hit the Internet, you didn't need speed doublers anymore. Do you really need to be paying as much as you are today? Is there gonna be as much demand? How much is this gonna get bundled in with GCP or AWS and so on in the future?

So that would be my kinda macro hesitation and caution on the diligence as I ran my diligence on this thing. You basically need an economist to map this all out. It's the same question for data centers That's right. In a related way. Right?

Which you just need to map everything. And I I don't have those date those numbers. So you're right. So it's a hard thing to figure out. That's right.

That's right. Well, the founders have control of the company. And they sold 500% secondary. A few million. They sold a lot.

Maybe it's a hundred 50 each or something. But they've kept most of their position. They're smart guys. So let's see. They still own the majority.

I don't know. I'm sorry. I don't wanna speak negatively about the business, and I haven't spent much time on it, but, I mean, I think that that's gonna happen. If you speak negatively about somebody's business, I mean Jacob, you tell us. Like, you've been there for a list for a decade?

I don't know. I mean, the ratings keep going up for this week in startups and all in, so I'll, I'll take it. Shout out. Are you purposefully starting to dress up, JCal, by the way? Because I noticed every week now you're wearing a fucking gown.

A jacket. I had a speak I had a speaking gig, but, my friends at Eton reached out to me. So I might be trying to do a little grief like that. Are you plugging right now? Are you plugging right now?

No. Laura Piana hasn't reached out, but Eton shirts, which I'm wearing right now, e t o n, you know, the famous, shirt people are, they've been reaching out. And I also no. No. No.

No. I got but I'm also saying Tom Ford's people reached out and said, you know, that lapel thing, you can take that off if you want. We'll have somebody come over. So I just wanna shout out my friends over there have no commercial deal with them yet. The Kiton, k I t o n jackets I've been wearing.

K I t o n. Kiton, very nice. I would like to check them out. On earth. I wear them all the time.

I love those jackets. Just saying let's move on. Go ahead. By the way, I yeah. And Joe Lonsdale's outfit is recently by the Uighurs.

The Uighurs in China. He gets them specifically made for $17 each month. I was recently I was recently sponsored by a company. This cut this is incredible. What they do is when you're flying into just a note put in ad in it.

Right? They they meet you at the FBO and they take your watch and they they set the new time for you. So especially if it's a mechanical watch, it's a very complicated Oh, yeah. This is very important. Right.

I got you know what? I was flying to Malta. This exists to my and I had my watch collection, and they did this for me when I was flying between, Montenegro and Malta. Absolutely. I'm just trolling.

I'm just trolling. This is my four spi billings telling you how to look at the world. We should get rid of income tax. I'm sure everybody listening is like, really convenient. No income tax for the billionaires is sent to millionaires.

Good job, guys. Alright. Let's keep going down the alright, Shmab. You know, we've been going back and forth in the group chat, and and you've been talking about it publicly, maybe Main Street versus Wall Street. And what's going on in the markets here?

Because there's EU bond issues. We obviously, seems like in some ways, maybe the Trump campaign is not thinking about the stock market as much as they're thinking about the bond market. Explain to us your take on markets right now. Yeah. I think that there's three markets that are important.

There's The US long end of the curve. So this is the ten year bond yield. I think then there's The US equity market. And then the most next important market are the European bond and equity markets together. And I'll explain why in a second.

But just on the first few, I I mentioned this before, but I really do think we're in a secular shift where I think the MAGA majority and the base of people that can be a reliable voting block in the future, as I've said before, are working in middle class folks that don't necessarily own a ton of stocks, nor do they own homes of which there's a lot. Second cohort are people that are pro innovation and pro tech. And the third are patriotic business owners. I think that cohort is very large. And I think that when the core strategist inside of MAGA figure this out, one of the big takeaways is that they're not gonna care about the stock market and Wall Street.

And a lot of the policies will be viewed through the lens of Main Street. And I think that you started to see this rhetoric now, one from Bessent, and we'll play this clip in a second. And the second was just today from Trump himself. But Nick, do you wanna play the Bessant clip if you have it? I think over the the medium term, which is what we're focused on, it's a focus on Main Street.

Wall Street's done great. Wall Street can continue to do fine, but we have a focus on small business and the consumers. So we are going to rebalance the economy. We're going to bring manufacturing jobs home. That was the first one.

The second one was just today. Nick, I sent it to you. Do you want to just show it to these guys, Which I think is really interesting. So it says here, breaking news from, I guess, unusual wells. Trump has just said he's not looking at the stock market.

Okay. So Not sure I believe that, but okay. So why is this actually valuable? Well, if we are incentivized, if the government of America is incentivized to implement policies that crack the equity markets, it's actually really good in some ways. Number one is if you deflate asset prices, you also deflate inflation.

Okay? And Do you have an example there for the audience so we make it clear? NVIDIA is ripping at all time highs. You are like, oh, wow. I'm so cash rich.

You can go get a margin loan. You take that money. You reinvest it in a second home and a third home. You sell some stock, you start to buy cars, all this other stuff. It drives consumptive behavior that on the margin isn't there if the markets were much, much lower than this.

So if you rebase the equity values that people have, what you do is you actually depress the amount of free cash flow that they have to spend on other things. So it's a deflationary tactic. How the bond market reacts to that is if the stock market goes down is you start to become a flight to quality. Right? Oh my gosh, there's volatility in the stock market.

Oh my gosh, I don't wanna deal with the stock market going down. Let me just sell, take some chips off the table and buy ten year bonds. When you buy the bonds, the interest rate goes down. Why is that good for America? We have $10,000,000,000,000 we need to go out and borrow in the next nine months.

And so if we can pay 3%, three point eight %, four %, we save us ourselves trillions of dollars versus if we had to pay four and a half, five, five and a half percent. So that's the second thing. And then the third thing is that right now, what we had this week because of the Ukraine and Zelensky thing is basically Trump say we are totally risk off this war. And I'm not gonna debate whether that's right or wrong, but that's what he said. We're gonna curtail the aid.

We're not even gonna share intelligence. They're on their own. What did that force? What happened this week was the Europeans had to basically circle the wagons and they said, okay, we're gonna step up. And what they announced was a four year plan to borrow money to invest in defense.

What they also did, which was really interesting is The UK specifically said, we're gonna borrow it in this clever little way. This is their interpretation. So that it doesn't actually count in the debt to GDP calculations of my country. So they're start they're starting Flint. But then, so then how did the bond market react to it?

Nick, you can show it. They're like, you know what, guys, if you wanna fight this war, obviously you're allowed to do whatever you want, but the cost that you're gonna have to pay is gonna go up. This has been going up every day. And you're at a point now where this is severe fiscal pressure on these governments. I do not know how they sustain their deficits and raise more debt.

So all of this is happening all at the same time. I think Trump is pro main street, equity markets basically do not get bid, the bond markets respond positively, yields go down, good for America. They extract themselves from spending programs like again, it's more than a spending program but I'll just say it in this context narrowly, Russia Ukraine is a spending program that if you take off the table, that balance of responsibility goes to Europe And then the markets are saying, this is not right. We want this war to end and we're gonna make it more expensive for you to litigate it. If you put it all together, it's a really interesting moment in the markets I haven't seen in a very long time.

Joe, you think this is the refinancing of our debt is the end game here? There's like maybe 10% of people who seem to have fallen in that camp when I queried on these four group chats. Hey, you know, if we can depress everything, we lower consumption, we break inflation even more. Maybe people lose their jobs, you know, less consumption. And rates go down.

We have to cut rates three or four times, put pressure on the Fed. Then we can maybe refinance our debt, which is coming up some percentage of it. What do you think of that theory? You know, Jason, Chamath has a lot of interesting thoughts here, and I I think it's I think it's a very smart analysis. I'm not fully aligned.

It is true. Bottom markets hate war. War is expensive. War is inflationary. It's very clear Europe is going through, okay.

You know, war is more likely for us to spend money. That that hurts them. You know, in The US, I think the number one thing that Scott Bessen and Trump would want around this is is to fight for Main Street like they said, but that really is, you know, the kind of populous energy we have right now. And so I think they are focused on lower interest rates. Lower interest rates, you know, I have some someone who works with me, their spouse, you know, as a real estate agent, and then they're having a really tough couple years because interest rates spiked up.

If you get interest rates down again, there's so many different places in America where people start making money again with with the title companies, with, brokers, with, there's so many things that happen, right, with that. Trickle down. Yeah. It's it's well, it's not just trickle down. It's like this is the part of the economy that that just really does start to turn on and certain transactions can happen again.

And and you're right. It it is cheaper debt that is that is advantage as well. So I think disinflation is very important, and I think we have to find some way to get there. Chamath may be right that it's worth hitting assets to get to this inflation. That's something that that Scott could be working on because of all the debt.

But it is it is true. It's the easiest. It's the easiest. It's the easiest. And and and we and we do and we do need it for sure.

So and I hopefully I think there's some other more clever ways to get there, but but but I I do like that strategy. Well, I mean, you said there's some more clever ways to get there. Obviously, we don't wanna see eight, nine, 10 percent unemployment. That's another way to get there, and we don't want that because, you know, Main Street equals jobs. So what do you what is your other ways to get there?

Well, the other ways to get there is there's two there's really two right now in our society that are very positive. One of them is a higher productivity through AI. I'm working on a ton of things as are Sure. Everyone else doing that. Like, we're doing construction for much cheaper right now.

Government can't do that though. Right? Government can't be involved in that. That's up to us. Yeah.

We can make sure not to screw it up. There's a lot of people trying to screw it up in government. So I think David's job is very important there to get it started. Sam, what's not here, please. And then and then the second thing is actually cutting spend.

Like, just giving out hundreds of billions willy nilly to Stacey Abrams at all is very inflationary. And so so so I think I think cutting spend, it actually is a very positive thing. We could do a whole lot more of that. Freeberg, you heard the two gentlemen. What are your thoughts on the refinancing of interest?

As I've done before, I'm gonna give you incredible leadership credit for three years ago on this pod, pushing all of us to really think about what would happen if the debt increased another 8,000,000,000,000, which it did. And I think that influenced a lot of people in our circles. And obviously that's something that the president took on when none of us thought he would any president would ever take on that issue. How much pain do you think Trump is willing to take with the stock market going down in order refines the debt? The debt, is he willing to be incredibly unpopular?

Is he willing to deal with the criticism from Wall Street and from equity holders over some sustained period and how much would he be? If it goes down the market goes down 20%, do you think he's gonna cry uncle or you think he's willing to take that kind of pain prevert? Like I said, I I don't know about Trump. There's a, you know, I would say sixty forty, I'd be right. 40%, I'd be wrong.

So I I don't know. Most people are here for that. That's actually a pretty good ratio in poker if you can win that many hands. Yeah. I mean, I'd say 60%.

He's probably different than Trump one point o, and he's probably less influenced by the short term rumblings about the market. Okay. And he's probably listening to Besson on this one. Although, you know, I I I think it's it's gotta be a complicated relationship between the two of them, at the moment. I I do think that he is aware, and I would imagine the administration generally with Besant and others in in, kind of key leadership positions are trying to make the case that if we can get rates down, we have an opportunity to kind of refinance this $10,000,000,000,000 that's coming due in the next twelve months and get ourselves into a kind of more sustainable financing position.

There's still the fiscal position, which is how are we spending money and how are we spending money over time that needs to be addressed. This is this is the central question. You're you're totally right. Let's address that specifically with Ukraine. You're a bit of, a hawk in American exceptionalist, Joe, and, we are looking at a situation where we spent 175,000,000,000.

There were some other numbers that Trump was floating around that were incorrect, And they got fact checked. Hundred 75,000,000,000 is what we're actually in for according to all accounts. This was done, as I said many times on this very program and got laughed at and joked about, done on a lease loan. Trump, because these things were done on a lease loan, now has the upper hand with Zelensky and he's a great negotiator and he said we want 500,000,000,000 back. Don't need to make this about dollars and cents here because obviously this is life and death and and people's democracy we're talking about, their sovereignty.

But that hundred 75,000,000,000, if he gets that 500,000,000,000 back, that's a 42% IRR in three years on this. Even if we just got our money back, that would be fine for the American people. How do you look at the war in Ukraine both financially and in terms of containing Putin and finally in terms of our participation in NATO? Is it time for us to leave NATO? Joe Lonsdale.

Wow. Well, you know, Jason, Putin's a bad guy. That's number one. He's shouldn't have invaded. You for saying that.

It's refreshing to hear it on this podcast. You know, I I do think the last administration mismanaged it. I don't think he would have invaded with Trump as president. He certainly would have invaded with competent person threatening him. And so but, you know, but now we have to have peace, and I do want peace.

I don't wanna have the war continuing. But to get peace, you gotta get both sides to come to the table. I prefer peace through strength. I prefer being really strong on Putin and showing why he has to have peace. But then you need Zelensky to be a partner for it too.

And I do think listen. I do think Zelensky had the wrong idea on the White House last week. He should have been thanking them. He should have come more humbly. He should have actually been directed towards really wanting a piece.

And then listen. I I I agree that Ukraine's a very corrupt country. We may find out that he and his cronies have been taking a bunch of money. I don't know if they are or not. Either way, he has not really been signaling the right way to be open to peace.

And and a piece that does, I think, have to give up a little bit of Ukraine in order to get there. I think that's the option on the table right now, and that's the direction I'm about. The NATO question? What's the you know? And thank you for being so candid here.

What's the the NATO outcome here? Is it time for maybe Europe to just go it alone? Because they don't seem to like what happened last Friday at the White House. They yeah. And and maybe do you think it's time?

Maybe they we we bow out and let them arm up? This is really tough for me because some of the people I care about most in the world, live in places like Germany and and around there, and I want them to be safe. I also think that the historic relationship between The UK and The US is this very, very valuable thing that we have. They shouldn't just be tossed to society. These are these are critical, very long time allies and cousins.

You know, I think Europe's in a very, very bad place. It's very dysfunctional, man. It's it's it's I do not see European civilization going the right way the next twenty or thirty years. I think JD is right to criticize them on on anti free speech, on, like, you know, arresting people who criticize the Islamic threat, like, more than the people actually doing the rapes and stuff. It's crazy.

These places have lost their minds. You know? Yeah. It's bonkers. So yeah.

Do do I want to to totally give it up? No. But do I want to demand fiercely that the certain things get fixed and to use our foreign policy apparatus to make sure we fix those things if we're gonna stay in the relationship? %. What do you think, Chamath?

This NATO question seems like Europe is kinda signaling that they're willing to go it alone. And should The United States just say, okay, go for it. We're we're out. Because that's literally what Sachs retweeted recently. He just said, hey, we're out.

It's your problem. And I think the administration's given him free reign to to discuss the topic. You talked discussed it here for many years. What are your thoughts? Should we be out on NATO?

Well, I think the question is when do these transnational organizations outlive their utility? That's the question on the table. And it's not just a question for NATO, but it's a question for a bunch of these other things, the WHO, NATO, the United Nations. There's many of these organizations. What you've seen is that there are competitive organizations now that are just as important, if not more.

So if you didn't like OPEC, well, then there is this OPEC plus plus thing. If you didn't like how the Europeans and the Americans did intelligence gathering, then all of a sudden five eyes came out of nowhere. If you didn't like the g seven, there's the bricks. Right? So there is this tendency for the world to create these startups to try to challenge incumbency as the conditions on the ground change.

I think the most important thing right now the Europeans need to do is acknowledge this one critical fact. The individual governments of Europe are vibrant and powerful. The European Union itself was created almost without any real teeth. And so what happened is the folks there started to pass inordinate numbers of laws. Yeah.

And that has made it really complicated to be a European company, a European citizen, and that has to get sorted out. What is the real decision there? Is it about being Italian? Is it about being European? What is the separation?

And I don't think that that's clear. And I think once they figure that out, all this other stuff is much easier to figure out. Well, you also have, yeah, other organizations, Interpol, right? We have that. You have the UN.

I mean, it is maybe time to just re underwrite each of them. Freebird, what do you think? I think that there is a viable case for a peaceful transition to kind of a multipolar power dynamic. And if you're a techno pessimist, you're gonna have a point of view that there are more limited resources available to humans on Earth, and, therefore, we have to have influence to access those resources. If you're a techno optimist, you will believe that through AI and automation and all these other technologies that we could spend quite a bit of time around, that we are going to have abundant housing, abundant fuel, abundant materials, and generally an abundance of everything that one particular group might demand or need.

And you don't need to go be an empire to access the resources that your people are demanding. And what I mean is the mining industry is a good example. There was this discovery, which I think we put on the docket for the science corner today, of a giant thorium reserve in Inner Mongolia, which can be used to make a thorium molten salt reactor. And there's enough thorium in this reserve in China to produce enough energy for sixty thousand years of consumption based on current consumption rates. I saw a fantastic presentation this week by a startup that's, using AI and other sensing technologies to identify new rare earth deposits in the crust of the earth that we have absolutely no visibility into today.

And many of our assumptions about how much availability there is of certain rare earth metals is wrong and that there actually may be many, many, many orders of more material available to us to mine. And the technology for mining is getting better. The technology for discovering these deposits is improving and so on. So in that world where suddenly I can make all the food I want, everyone can be fed. There's plenty of land.

There's plenty of housing. There's plenty of water. There's automation that and robots that are serving me and all this sort of amazing stuff that's coming this century. Do I really need to be having a freaking conflict with Russia and China over access to some jungle or some plot of land on the other side of the planet? Or can I live sustainably on in my country and everyone's gonna be generally happy?

So I think that this idea that maybe The US exits NATO and The US dials down its level of conflict and opposition to Russia and or China is a pretty reasonable, and I would argue maybe even a techno optimistic point of view. And, you know, we may find that in the next couple of years, we start to really believe it. And if we start to believe it, all the things that we're fighting over today, you don't really need to fight over anymore. Mhmm. Except for the expansionist intentions of individuals, which is a sociological phenomenon, which may still continue.

But I'm not sure that you need to be investing as much resources as we have historically. So I would argue maybe NATO in a multipolar world of abundance isn't as necessary as it has been in the past century, which was a world that was limited in resources, fighting for access, and a growing global population, particularly in the developed world in the West that's made it a necessity to maintain US primacy and US policing of the world. And I know others might have a point of view that's a little bit different than that, but I just think we can make this. This. I think actually what you're talking about is a Star Trek beautiful version of abundance in the world.

If these rare earth minerals create unlimited energy and you're energy independent, you look at the world differently. And and, Joe, we certainly in America look at the world differently as we're all gen extras here, basically. We look at the world much differently now since we have energy independence than we did under Bush and and these, farm wars, you know, in The Middle East. Yeah? I mean, listen.

Yeah. And I I am I'm one of the most optimistic people. I call myself the American optimist, Jason, as you know. You have a great podcast. I'm the same American optimist.

I'm the same American optimist. I'm the same American optimist. I'm the same American optimist. I'm kinda good to go on. We live together now.

I mean, had Saks on? Have you had Saks on at least, American Optimization? People people are too busy to come on. I'll know how to get you. Alright.

I'm a row for four with besties. Got it. Okay. Alright. I gotta work on it.

Listen. I I would love AI to get to the point. I think it will where it starts to accelerate growth where the this energy stuff can be mined more easily. But until, I'd say until we're at at least 5%, six % growth because we are going to the post scarcity world, we don't know when it's coming. I do still think global trade really matters.

I do think global security for ourselves, we don't want random people with nuclear proliferation. So there are issues that are going to affect all of us, but I think Dave makes a really great point that it is becoming less important over time. It's true. Let's talk about this ChatGPT. I guess they came out with 4.5.

It was such a dud. I didn't even realize that they launched it. Chamath, you monitored this or Freeberg, did you try it? Because I've been using Grok as my default now, then Gemini, then ChatGPT. That's my order right now because I wanted to see how good Grok is.

And, man, Grok is That's great. Really caught up. And I don't have an interest here in, know, I don't have equity in any of these comp well, I own Google in the public markets, but I don't own the other two. But pretty amazing. Yeah?

What what do you think of this 4.5 dud and what what it means, Jamal? Well, I use them in in the company building context and specifically at 8090 because of what we're building. And what I would tell you is that I think Anthropic just continues to do an incredible job. I think Cloud three seven is it just kicks ass. Oh, you're you're on Cloud for you're using on the back end.

Yeah. We use it for a lot of automated code generation. Got it. And its models on code generation, I think are just exceptional. They are the best in market.

Then what I would say is as a consumer, I've mostly flipped my usage to GROC three. Yeah. And the reason is that it's in line with where I consume most of my information. It's elegantly integrated inside of x. It's Yeah.

To point this out to explain to people, when you're in Twitter now x, on the top right hand of a tweet, there's an x a I button. When you click it, it just gives you the full context of the tweet. So I was reading one of Dara's from Uber's tweets about autonomy. I guess they added two more partners. When I clicked it, it gave me more than I ever could want.

It was almost like a deep research of the context of a very short retweet he did, And I didn't have to cut and paste and form a question. So owning a social network equals instant. And here we're gonna show it with Joe Lonsdale's where he says, hey, listen. The, you know, the the crypto tax feels like taxation to me. And look, it goes and finds four web pages.

You can see there, it it tells you which ones, Wikipedia and, CNBC amongst them. And then it gives Joe's position. This is like very elegant. There's a This is super elegant. And I think there's a small tweak to this Okay.

That Elon and I were talking about actually onX, which is then just the nature of being able to analyze a post for its veracity becomes really valuable. That extra little thing when it's available, I think will have a really big impact on how people use it in this context. So I use Grok for the consumer applications. For all of our code generation, we're using SONNET three seven. It's exceptional.

Which is Anthropics, which is doing a major round of funding. Got it. Okay. Yeah. And, and I think like the, the thing with the GPT 4.5 is that it's kind of like good.

Now here's, here's a tangent. Let me just do a small little rant, which is we're at the bleeding edge of where these benchmarks are useful. Meaning part of why Jason, maybe you weren't necessarily watching this as closely. And I think where the media and the sense making organizations get confused is they don't know now what to say, Because they'll say, hey, look at how I did on Sweebench, look at how I did on AIMO, look at how I did on Amy. And the problem, the dirty little secret of these model makers is that these guys are so trained on the evals that they're overfitting.

Yeah. And all this overfitting basically makes it pretty unreliable. And so What this means to translate into plain English for humans listening is they basically are optimizing for the test out of the benchmark. Yeah. Which is kind of like a person in high school or, you know, optimizing for the SATs.

It doesn't mean they're gonna be a great student but it may mean that they just spent a lot of time taking SAT tests. Yeah. So we have we have one problem which is that I think it would be very valuable for the industry that it be solved which is that we need to have extremely difficult and always changing third party independent verifiable benchmarks. Oh, that's a great idea. Like the safety test for cars is that's not run by the companies.

Got it. Less about safety though, more about capability. Sure. Sure. And I think if we're reporting on that, then these leaps will mean something more than what they are today.

Right? So Got it. When Alibaba pushes Gwen this week, it was an exceptional model. It's probably one of the better open source, if not the best open source model out there. DeepSeqs, I think is also quite good.

It doesn't get any press anymore. So I think we're starting to get to this place where there's such abundance that actually people are just kind of like overwhelmed with all the choice and they don't know how to differentiate. This is like a hundred Michelin star restaurants opening up in your city. You just don't have enough meals to eat. It we're we're we're basically drowning in abundance to Freeburg's point.

We I don't think we understand exactly how golden how golden this golden age is in terms of technology. Distribution distribution becomes really important. I think that's why Absolutely. We discussed this. Access very valuable.

But also, I think Google just said that they're gonna drop an AI button right into the front door core search page. I don't know if you guys saw that, but Google doing it. When you're logged in, you will get the snippet at the top. Inside of YouTube, they're doing summaries of the chat and the comments, and then you think about what Meta could do. You know, they already put the AI box up there, but, you know, they'll they'll knock some of that off.

No. I'm not all the Google front door like google.com. Yeah. Does anyone use that anymore? Shrunt Murray.

Well, I mean, Google searches are are still going, but And Facebook is about to launch a competitor to Chachi and Crook. Yeah. Well And they're gonna do a straight up, A standalone app. And the thing that they are so good at is whenever they launch an app, it doesn't matter when they launch it. They'll just get it to a billion people.

Yeah. I mean, that that is, super true. All this, I think, leads to so much abundance. What I'm I'm seeing in startups I was the first investor in a company called Superhuman, very elegant software, luxury software for email productivity. Give it a shot.

What he did was I didn't mean he has a super plug here. But anyway, I I I'm so in love with the company and the founder. I I just had them on this week in startups. He's like one of the best product minds I've ever met. Keep going.

Extraordinary. And Superhuman now because it's gotten so cheap to do AI that they are composing in this beta I'm in all of the replies to your email in real time on the back end, and you can see potential drafts. They summarize everything. Even if you never read the summary, that would be cost prohibitive six to twelve months ago. But now it's a no brainer because they're paid software.

It's like so this is gonna get very interesting very quick. Joe, your thoughts on this, abundance. Yeah. I'm actually building something on email, like you said, that that works with your team to automatically plan, like, you know, create reports on everything that comes in and route it for you. Because a lot of our friends, when you're a CEO, you basically become a traffic cop.

It's actually the email's gonna do it for you. It's gonna be it's gonna be really nice. But listen, I'm invested in Grok three and I'm biased towards Elon. But, you know, a lot of our companies will build on top of multiple of them as well. And, you know, I think you're talking about Cogent.

I'm I'm, you know, in Cognition, I think, about a lot of my companies using dev, and it's actually just, like, crushing it. This stuff's getting, like, 15% better every month. It's really amazing and it's good for companies like that. I'm mostly at that level where I'm using all of them or using a bunch of them. So I love the fact there's always competition because it just makes it cheaper and better for me for all my companies I'm building.

And it's not slowing down is the other piece of this. No. It's getting better. It's scary actually. I thought it would I thought it would asymptote and it hasn't.

So it's amazing. That's that's the part that's so fascinating to me. And then there's a really interesting ripple that I don't know if you guys are aware of yet. But journalists who have been losing their jobs at a tremendous pace are now being hired by data aggregators to come in, look at queries. Let's say you had an expertise in agriculture, Freebird, they'll pay you.

And I actually saw one of these job descriptions, $40 an hour to sit there and answer questions about agriculture, look at answers, and refine them and do reinforcement learning. We're gonna have a new job class, which is people who train AIs and people who fact check AIs and refine AIs. And this could be a 50 to hundred $50,000 a year job because every time you make the AI a little better, everybody on the planet gets to benefit from it. This is an extraordinary new job career. I don't know what it's gonna be called.

Reinforcement learner. I don't know. Freeberg, you get the last take here. Great job on the abundance angle, which just pushed a really great discussion here. Wrap us up with your thoughts on these LLMs and the pace of AI.

I used to agree with Jamar. I think it's like, you got a lot of great stuff here. It's changing every week. I'm not paying attention to the details anymore. New models come out every week.

This is like when the Internet launched, new websites, you know, like, this is this is carrying us forward. It's impossible to dissect and predict what's gonna win, when, and why right now. What are you, obsessed with in in the AI front? Is there are there things out of hollow? I use I use chat g p t research a lot.

The deep research. Right? Where it fires up a bunch of web pages. Okay. And you're paying that means the $200 a month or you have to search?

Hundred a month. Yeah. Yeah. No. I find it I find it very good.

Yeah. And then, we build everything at Ohalo on GCP, and we've run a bunch of different models. That's Google's cloud for people who don't know that right now. Got it. And then we run models.

They're incredible. Yeah. Yeah. Lots of different tools, but it's awesome. Hey.

As we wrap here, we're following our muse here at all in. Whatever the besties are most interested in, we are gonna bring you the audience along with us. So Friberg and I have been obsessed with content creation and media. So we're doing a little media summit at South by Southwest. Apologies that it's sold out.

And then Chamath, you know, he likes this f one. He's a big F one fan. I've never been. I'm really excited that we're gonna be throwing the best party You're not gonna be nice. At F one, Saturday, May fourth.

I am coming. I'm so sure. I'm not showing the bag. Thursday or not, there's only room for two. As long as I get the bag.

I'll be outside. You know what? I'll just go to eleven. Give me my bag and I'll go play a tournament. I'll go to eleven and have a steak and that's it's a it's a it's a club.

I'll get I'll pop some bottles at eleven while you guys are at F1. You can Photoshop me in. But the fans can come, and our community can come allin.com/events for all the details. And if you wanna party on Saturday night. Big party.

It's gonna be fun. We're throwing a big party in Miami around f one, and we're gonna do a little stage show beforehand because it's gonna be awesome. And we're gonna we're gonna celebrate my birthday because I'm not gonna be able to make it in June. Can I wear my Apple Watch? Can somebody loan me a nice watch for f one?

I can't show up with an Apple Watch. Anybody kinda You're not allowed to wear an Apple Watch to Apple. Okay. I'm gonna put my Apple Watch in my in my drawer. I've never been to a dealer watch.

I've never been to a dealer watch. I I want a watch that costs 25 to 70 5 k. What's a good starter watch for Jay Cal? That's like an appetizer. That's what my watch has as a watch.

Your watch is watch Joe, do you guys go into this watch thing? What should I buy for a hundred dimes? What do you got there? You you can get a decent Patek for a hundred now. It's like they've gone down.

Yeah. It's Yeah. I mean, everything's collapsing. I should shouldn't I be able to snipe something here? It's it's deflation.

Thanks to Trump and AI. Right? You can grab Yeah. Absolutely. One of these.

AI general. I think whatever. Somebody give me a suggestion for a watch more than anything. Get a good mechanical watch. Get a good mechanical watch, not an automatic.

A mechanical Anybody wants to sponsor me for watches and get a mention here on the show, I will riff the hell out of that jason at calacanis.com for life. I just got a text from Swatch and Tudor. Oh, a Swatch watch. I used to wear, actually, the eighties. I don't know.

Free Freeburg definitely had a ton of those Casio watches. Right? Yeah. Did you have the Casio where you would, do your The g shock. Your Casio watch.

Is a great watch. That's a good time. No. I'm talking about him with a calculator watch. I actually I had that.

It was I remember it was $50. It was a really big deal to It was $50 and it was worth it. You play the game where you start and stop it as fast as you could. That was that was fun. Exactly.

Remember that? Yeah. Exactly. I had one on each wrist. I was doubling down.

I recently bought a G Shock on Amazon as kind of like a memento to Hold on. Recap. And my Yeah. Freaking daughter stole the G Shock. That's a cool A freight bar we can all bet on this.

What calculator do you have on your desk right now? How many calculators are on your desk now? How many can you reach? How many Casios are within reach? There's only one calculator that matters.

Only one for me. Yeah, okay. HP 17B. There's only one calculator. That.

Oh, you got my t two. What are you talking about? I got my t 89 still. 89 for me. But Oh, now you just told me how how you're younger than me, Joe.

Now I know you're, like, four years younger than me. I am. Yeah. That's true. Can we talk to the triple age, actually?

Yeah. 80 it was the eighty one, eighty two transition that was, like, a big deal. Yeah. You know what I was doing when you guys were on your calculator? I can't even imagine.

I was in McKinley Park in Bay Ridge getting to second base. Alright. Enough. Allin.com/events. Did the guy consent?

Absolutely. Absolutely. He was a really hot dude. Please. We we have two genders, folks.

There's an executive order. I read it. Alright? Alright. My Trump grade for the week is c for chaos.

A for effort with, a for effort with Doge. Let's try to get back to a b, President Trump. We'll see you all next time on the All in Pie. Love you, boys. Thanks, John.

Thanks, guys. Have fun. Bye bye. Alright, everybody. We're suited up.

We're suited up because the czar, the Wolf of the White House is here. My brother, David Sacks, we were trying to get you on the program. You were gonna make a drop in to talk about all this great crypto news coming out of the White House. And, let's face it. This was a, some people saying chaotic.

Some people say intense. This is a pretty amazing intense week for the administration, so we'll get into a little bit of that. But you're here specifically to talk about the crypto reserve. So welcome back to your program, the All in Podcast, David Sacks. Good to be back.

I see that you've suited up here. Yeah. I mean, I figured for people who, weren't here for the preshow, I get on. Sachs is wearing a white shirt and a tie. I'm wearing a blazer and a white shirt.

So I'm like, I gotta go put a tie on. He's like, Jake, I wore a blazer. I gotta go get a blazer. So then we came back, and here we are. And, well, look.

I I just have to correct one thing. I think it's been a very smooth week at the White House. The president has lived up to one of his campaign promises. This is not something new. I remember you go all the way back to his national speech during the campaign, and he re reiterated this many times that he wanted to create a strategic Bitcoin reserve.

Sometimes he called it a digital asset stockpile. What we've ultimately done here is both. He also, in his week one EO on crypto, you guys remember I came on the show to talk about that, he asked our president's working group on digital assets to evaluate the idea of a reserve or stockpile, and we made a recommendation and this administration is moving at tech speed. It's really great to work for an administration where you could actually get things done and things move quickly. We made our recommendation, and then we worked with the lawyers to implement it, and president signed it last night.

But this is fairly consistent with everything he's he's always said. Agree on that. The, I guess the one criticism that you're gonna get get when you go face the media, so I might as well put it here, is the order in which you're doing things. Sometimes mister Trump is very, expressive on the social medias, which is better than, let's say, the previous administration, which just wasn't available and and in cognitive decline. So I guess the the the question of he announces something and then you guys explain it deeper.

Is that the optimal way to do this? Should we not worry about it? Should you come out with, like, more official stuff? I guess that's the move fast, break things that we are used to in Silicon Valley, but that people, you know, whether it's in business, are maybe a little concerned about that things are maybe different now in the White House and and in how we're running our government. Maybe you can expand on that.

Have you ever considered that maybe you just had an overreaction to a tweet? Well, okay. So if we're gonna place the blame on me on this saying that that that the other only one. The the original crypto OGs were like, wait a second. Why is he picking these three and not these three?

You know? So that made a lot of people putting myself out of it like, woah. What's going on here? Is he picking favorites? And that's, I guess, everybody's big concern.

So maybe you could assuage that. Yeah. We're not picking favorites, obviously, except I will say this. We do think Bitcoin is special, and I can get into to the reasons why. That's a great thing.

Yeah. Well, I mean, Bitcoin is the original cryptocurrency. It's the first one. It's the only one that doesn't have an issuer. Right?

It's it's very decentralized. It's you know, in crypto, they call this the immaculate conception. We don't really know how it got here. We don't know who Satoshi is. It's almost mystical, you would say.

Yes. It's the most valuable one. It has a $2,000,000,000,000 market cap, and it's the most secure. It's ever been hacked. Right?

So we're now, you know, over fifteen years into this journey, and there's been a lot of people who've been skeptical along the way and there's been a lot of ups and downs, but here it is. I mean, I remember back in 02/2011, I think it's the first time I bought a Bitcoin, I think it was at a hundred and $20 Now it's at $90,000 Again, there have been all sorts of wild swings along the way, but this thing just keeps keeps chugging along. And you can think of that $2,000,000,000,000 market cap as like a $2,000,000,000,000 bug bounty. Mhmm. If there was a way to hack this, there's every incentive in the world.

And by hack, I mean, like, to double spend, create basically a counterfeit. Bitcoin, I guess, would be the way for people to think about it. And so this is your miracle, it hasn't been compromised. I think we can all say that. Well, I I don't know if it's a miracle.

I think it's exceptional design. Sure. You know? And so I think I think what you could say is that it's been tested in a very robust way, and there's been every incentive to basically break the encryption, and it continues to chug along. And so I think the price has gone up as the protocol has gotten more acceptance.

And this is another point is that Bitcoin's most widely accepted as a store of value throughout the world. Yeah. So we do believe it should be treated special. Now that being said, we're also creating the digital asset stock pile. So all the other digital assets difference between these two.

So there's a digital asset stock pile. Mhmm. That's the picker. And then on the other side, there's a strategic reserve for Bitcoin because we do acquire Bitcoin, we, The United States Of America, when we seize from terrorists, you know, criminals, etcetera, we do seize these. And then we often make the mistake of liquidating them when maybe we should be holding them.

Yeah. So it's been that architecture. So we have the reserve and we have the stockpile. So the reserve is just Bitcoin. The goal is long term preservation.

Think of it as like a digital Fort Knox for digital gold. We wanna put the digital gold in there. We wanna keep it secure. We never wanna sell it. That's the goal of the reserve.

And you're right that we've made the mistake in the past of selling this stuff. At one point in time, we had about 400,000 Bitcoin on the federal balance sheet. We sold roughly half of that for something like $360,000,000 total. If we had held all of that, it would be worth just that the portion we sold would be worth over 17,000,000,000. So we made this mistake of prematurely selling Bitcoin when we should have held it.

We don't wanna make that mistake with regard to the rest of it. We think there's around 200,000 coins left on the federal balance sheet, but the truth is that nobody knows because we've never done a proper audit. So part of what this executive order provides is that we're gonna do for the first time a government wide accounting of the digital assets that we actually have. So And if digital assets emerge in some department, I don't know, the FBI sees this some, the CIA sees this some, I don't know which organization winds up having them, they're gonna be legally required to report that and then put them in the reserve. Yeah.

Well, they'll they'll be legally required to report it, and then they'll go in the reserve if there's a final adjudication. So, you know, obviously, if those coins could go back as restitution to victims or if the person who they were seized from wins their court case and gets them back, they're not gonna go into the Federal Reserve. But if there's been a final adjudication and a final forfeiture, yes, those will go into the Reserve. But, anyway, that's Bitcoin. Okay.

So then you got the stockpile. Let me just talk about that. So first of all, like I said, we don't know exactly what digital assets the federal government has. I've seen reports that it might have, for example, 50,000 ETH, which is Ethereum. But, again, we need to get to the bottom of that.

When we figure out exactly what the assets are, we're gonna move them into the digital stockpile. The purpose of the stockpile is responsible stewardship. It's a place for safekeeping. It's a centralized, you could say, account under the direction of the Secretary of the Treasury, and the Secretary of the Treasury will figure out how to maximize the values of these holdings. Now, there's a couple of important differences between stockpile and reserve.

So one is the reserve the executive order actually provides that the secretary of the treasury will not sell the Bitcoin, okay? We're we're prohibited from selling the Bitcoin. There's no such prohibition with respect to the stockpile. If the secretary of the treasury decides that's in the long term interest of The US to rebalance the portfolio or change the portfolio, the secretary has the discretion to do that. Okay.

Which makes sense because there's a long tail of crypto. We might see something that we don't have the ability to predict the predict the future, and we don't have the staff to sit there and look at these assets every day like a fund manager would and say, what do we do with these? What percentage should it be of the overall stock pot of the overall holdings? So maybe the decision with Ethereum is, hey. This thing's waning.

We just put it into Bitcoin because we know that's the more solid one. Yeah. That's what I'm reading into it. Yeah. I mean, I think that that's that's largely fair.

I mean, look. I think that the stockpile should be subject to good portfolio management. Right? And, fortunately, we have a secretary of the treasury who is an extremely successful former hedge fund manager. So he's gonna figure out the best way to manage these assets, and we give him the flexibility to do portfolio management.

Whereas like I said live and die with what he does. He has to make those decisions and and that's gonna be, you know, part of how he's evaluated by the president. So hopefully he's gonna be sharp about that. Right. But the reserve is different, right?

The reserve is just digital for Knox. Now there's one other important difference between stockpile and reserve. So with respect to to reserve, the the EO provides that the secretaries that I'm talking about, treasury and commerce, they're allowed to figure out strategies to accumulate more Bitcoin for the reserve if those strategies are budget neutral and don't cost the taxpayer anything. Okay? So it's possible that we could.

I'm not saying that we will, but it gives them it authorizes them to acquire more Bitcoin if they can figure out a way to do it that doesn't impact the federal budget or the deficit or taxpayers. Right? Okay. Well, I had a very simple suggestion for this, which I'll Mhmm. Float up the flagpole here to see what you think.

You probably we've talked about it on previous all ins before you're on it. How about a simple crypto tax? You know, crypto wants to be legal. You're the crypto czar. Crypto wants to be regulated.

They want the rules. They want the rails. Simple suggestion from your bestie. Why don't we charge every transaction in The United States point o 1%, just but one bip, in that native currency? So you wanna trade some Solana for Ethereum, for XRP, whatever, you know, put in whatever names you want there.

The government says, hey. You wanna have a a great vibrant system here? We're gonna need to take just the most modest of taxes, de minimis in fact, in the native crypto and put it in the stockpile. This seems to me like a very That's always how taxes start is that they're very they're described as very being very modest. You know, when the income tax started, it only applied to, like, a thousand Americans.

Yes. And the legislators swore up and down that it would never be applied to middle class people. So I don't particularly like the idea of of new taxes even if it's it's promised that they just won't affect people very much. That sounds burdensome to me. But look, we have very successful Well, this would and just so you know, this is would be like more like a sales tax that would be handled by Coinbase, would be handled by Robinhood, by would be handled by those platforms.

They would administer it. It would be a transactional tax, not an income tax. So if you have a bunch, it's not a wealth tax and a season tax, but I'll let you pertain on it. Yeah. If you can convince if you can convince the secretary of the commerce or the secretary of treasury to run with your idea, then Great.

It could potentially happen. I mean, they have the flexibility to figure out budget neutral ways to accumulate Bitcoin. I don't know what those ways are gonna be, but they're creative. They're very successful businessmen. And if they figure out a way to do this, then it can be considered.

That's the point. Okay. Well, I'll be in the commissary later having lunch with you. You can introduce me. So let you let me just give you a fastball here.

Well, we'll see if it if it gets in the strike zone. The appearance of impropriety is what people are concerned with, the picking of winners and losers. President Trump was the crypto president. He went and he gave that famous speech. I'm gonna get rid of Gary Gensler.

We're gonna make it legal. And to his credit, he has fulfilled that promise, which means, hey. The donor class on that side said we're gonna back the crypto president, not the anti crypto team, which means a lot of people who are on the Twitter and the socials have donated a lot. They have a lot of holdings. So this appearance, which you've now, I would give you credit, have cleaned up here.

Hey. There's two different things going on here, and we're not using taxpayer money. We get all that. But the appearance here is, hey. Maybe somebody's gonna benefit.

Of course, that they came after you first for that without the facts. You were very clear. You cleared all your positions. You sold everything. You divested.

So let's make that clear to the dum dums who are just trying to say that you are personally gonna be a threat to that. That. Yeah. I mean, look. Please.

Because this is ridiculous. Yeah. Well, people came out right away and were saying that somehow I was engaged in a scheme to pump my bags or to basically create exit liquidity for myself and and billionaire stuff like that. You have to understand that those accusations, I mean, they're accusing me of a crime and Serious crime. And yeah.

A serious crime. And they're doing it with no evidence whatsoever. So these things are basically it's borderline Slander. Slander and and definitely It's slanderous. Yeah.

I would say so. In any event, what they didn't know and what I then proceeded to put out there is that I sold all my cryptocurrency prior to day one of the administration because I didn't want to even have the appearance of a conflict. And by the way, I could've waited. I didn't have to do it like that, but I decided to do it and take it upon myself to do that because you just know that when it comes to crypto, there's gonna be a lot of fluctuations in the market. You never want someone to be able to point at one of those fluctuations and say somehow that the cryptos are benefited from that and create a conspiracy theory, which is exactly what basically happened.

So first of all, I got rid of all my cryptocurrency prior to day one. Craft also sold all of the is the venture firm that you funded that's done a lot of great work, supporting founders here in Silicon Valley. So we we basically sold, I think it was around $200,000,000 of crypto, of which around $85,000,000 was personally attributable to myself. And we cleared that before day one, paid taxes on it, and basically, so there wouldn't be a conflict. So then the sphere shifted in another direction.

It was, okay, well, maybe he doesn't own crypto. Okay. But he's in crypto funds, okay? And so they pointed to, you know, Bitwise and Multicoin Capital and I was also in Blockchain Capital. And so then the fund managers came out and one by one all said, actually, David called us over two months ago and said he's gonna need to divest from our funds.

And so we also did that. So Yeah. You know, I think basically they've kinda given up on this. But look, it's very easy for me Why let the facts get in the way of a good slander? Seriously.

You know? Full disclosure, you know, you, when you saw me doing the Sequoia Scouts program, said, hey, why don't you do a fund? I'll be the anchor. I'll be your first LP. And I mean, one of the most generous things you've done in in our relationship.

And I had to have a call with you, you know, weeks ago and say, hey, okay, you're gonna divest. Okay, fine. No problem. No, it's not not a problem for me. You sell the assets to somebody else.

So the way people understand how this mechanically works, when you're in a fund, you have no Sachs cannot tell me what to do in the fund. He just put money in it, like I put money in other people's funds. They go and invest and ten years later you get a return. And hopefully that return in a venture firm or private equity firm beats the markets, the public markets or whatever. But then you can also sell that interest to somebody else.

So mechanically, and then this takes time. And you have to sell it at 50%, twenty five % off. And it's painful. You will lose I estimate, you're going to lose, you know, I don't wanna be gratuitous here, but $8.09 figures by serving the country for a couple years. And not only that, the great irony of this is the one thing holding back the industry is regulation, overregulation of AI and no clear regulation in crypto.

You're going in to fix the two things that were number one and two on all of our agendas in Silicon Valley in terms of getting returns the next four years. So the sacrifice you're making is extraordinary, and you're making it a better environment, a regulated environment for the rest of us to do commerce. So I I just wanna point out that you're losing, like, double here. Right. Well, let me let me just underscore something you said because service.

And I don't know how much should I pay. How much are they paying you for this job? What do you get paid? Like, $50, a hundred grand? I'm an unpaid consultant to the government.

Really? Is that actually accurate? You're giving me no money. No. I don't want I don't want anything.

Costing you money. No. Of course, it is. But it's Yeah. It's it's an honor to serve, and it's a honor to be asked to serve.

And in particular, it's an honor to serve this president because he really wants to make the country great again. So that's why I'm doing it. But, yeah, look, I think it's a it's a lazy and stupid narrative to say that the reason why someone who's already successful in business goes into government is to somehow make more money. I was making money before. This involves a substantial disruption of my business interests, and I have to divest a lot of those business interests.

And in divesting, I have to be either a taxpayer or I have to take a significant discount, and it costs you money. So, you know, it's it's just a lazy narrative that people create, but it's there's no truth to it. And just to underscore a point that that you made a second ago, you were one of the funds I divested from, not because you're a crypto fund, but because you might have a crypto position. We went through, I think, the Launch Fund's holdings, and I think there was something crypto related in there. And so one or two that pivoted into crypto.

Yes. Right. So I just didn't wanna have any problem there. So Listen. It's this is the nature of the politics we have.

People are you know, it gets very personal. You know that better than anybody. And so, you know, that's why you're here. And, hopefully, we can clean this all up and, let people know that, hey. The intent here is good.

So just just to go back to one other point you said about not picking winners and losers, I I think that's a very important comment that you made that I see as fundamental to my job. I mean, look. I think we do think that Bitcoin is special for the reasons I said. Beyond that, we do not wanna be in the business of picking and choosing winners in in the space. And, again, if some other digital asset could prove that it's as decentralized and as secure and as widely accepted as a store of value as Bitcoin, then maybe it could be elevated in the same way that Bitcoin has.

I mean, I'm laying out the criteria for you. But, look, beyond that, we don't wanna be picking winners and and losers in the space, and that's not my job. I mean, my job is not to to be a regulator or to anoint which ones are good or bad. It's to basically be a policy advisor for innovation. And I'll just tell you the way that I see the, you know, all the digital assets in this space is that what's fundamental is disclosure.

If you're an issuer of a digital asset, you need to disclose, you know, all the material facts about what you're doing, and those facts have to be accurate. You can't lie. My view is that if you if you, the issuer, lie about something, the government should come down on you like a ton of bricks because that's fraud. Okay? But as long as you do this in an honest way, people should be able to trade these things.

I understand that you think a lot of them are garbage. You might be right. You could express that view in a trade. But as long as everyone has been above board in terms of disclosure, people should have the right to trade these things. And some are gonna make money, some are gonna lose money.

It's about the freedom to basically to trade, to hold these assets. The government doesn't wanna get in the way of that. It just wants to make sure that the information is out there, that it's honest. And if people lie in order to profit, I'm all in favor of going after them. Well and, you know, we already have a regulated market as an analogy.

And when you tell a lie and you sell a share in a company, whether it's a private or a public company, the SEC has a term for that. It's called securities fraud. And we, you know, have this new type of device. It's very innovative. It could be an NFT.

It could be a trading card. It could be an actual utility token where you burn it in use of a service, or it could be anything. It could be whatever the person describes it as. But what's important is there's an entity with a group of people, I think you would agree, who have said, we have ownership of this. We're incorporated here in The United States, not in Panama, not in the BVI, not in some, you know, other place where maybe they're a little faster or looser with regulations.

You gotta be here in The US. Maybe you have to be insured in some way. Maybe there has to be a board like there does in Delaware or in an LLC. There has to be some person where the buck stops. And if you lie while committing a transaction or taking money for an asset, it would be securities fraud.

And, yes, people will come down on you like a ton of bricks. And if you promote things and you don't disclose it, well, we have rules about that as well. We saw many celebrities get pinched last time, for tweeting about cryptocurrencies. And and this is the stuff that I think has to stop. I think it should feel more like what we do in angel investing in private companies and in public companies.

So that's your job. When are we gonna see, you know, that framework emerge? Because here, you're only, like, forty, fifty days into this, I think. When will we see the actual bones of a framework? So if I wanna do j coin and I wanna make a angel investing coin or I wanna do something fun, an NFT collection for all in or something, when will we have the actual rules of the road?

And that's gonna be multiple agencies. Right? Yeah. What you're describing is is known in Washington or the the the, the area of policy that you're describing is known as market structure. And market structure is about providing a clear framework for market participants.

It would define what is a security, what's a commodity, what's simply a collectible, you know, it's just property but it's not a a security. And then what are the rules for each category? That's known as market structure. There is a bill that passed the last Congress in the House, but Biden basically he didn't veto it, but he basically he and the Democrats stopped it. He stopped it in the senate, the Democrats did.

It was called FIT 21, and it was authored by French Hill, who's now the chairman of the House Financial Services Committee. So we expect that he will be introducing a new version of his bill probably in the next few weeks. I don't think I'm breaking any news by saying this. I think people expect it. And that's gonna provide the framework for market structure, and it's gonna provide a lot of the definitions that that you're talking about.

Now I I agree with your sentiment, okay, but I will say that I might have a different view than you of what is a security, what's not. I mean, to me, collectibles are not securities, but if it's a collectible, you gotta disclaim that, look, this has no intrinsic value. Right? That's a collectible. Think about a baseball card.

A baseball card is a piece of cardboard. It has no intrinsic value, but the value comes from basically other collectors being willing to buy it from you. And you could just say that that's irrational or whatever. But so look. I think as long as people disclaim that this coin has no intrinsic value, they should be able to issue meme coins.

It's a separate question why people would wanna buy them. But look, that's very in my view, that's very different than someone who goes out as an issuer and says, I'm issuing a token or a coin that has lots of functionality and has lots of value, and you'll hear some of these guys even say that, hey, our token is more valuable than Bitcoin. You should value it more highly. Well, if you're promising that and you're saying that it's gonna have certain functionality, you better be telling the truth about it. Yeah.

And then we start getting into how we test, and people can go look that up if they if they want. What I will say is there's an educational process that has to come in here, which we've gone through as The United States. When people would buy interest in mines, people would buy interest in gold claims, oil fields. And that's when a lot of these regulations came out in the twenties around accreditation. We've spoken about this before.

It's a pet peeve of mine, but I think there should be an educational framework here. And I think there should also be some nuance that you could work on specifically with this group of being clear that when you have a ticker symbol associated with something or you do charts associated with something, you know, it starts to smell like a duck, it looks like a duck, it's quacking like a duck. But then in the terms of service, it says, hey, this is a collectible. I think there needs to be some ground rules, which maybe it says, hey, these need to be presented in a certain way at the top level. So the nuance of disclosure is so important.

When I tweet something, if it was an advertiser or a sponsor of All In or This Week in Startups or any influencer or you did the would you do this? And you said, I love, you know, this brand. You and I both were well, you were an investor in H. C. I.

M. If we were to tweet about that, as investors, we don't have to disclose. But if we were paid for that, the FTC has rules. You have to put, this is a paid partnership. You cannot confuse consumers.

And I think that's where you're gonna have to do a little bit of cleanup work and structure as well, is the disclosure and how this appears, and then also maybe the educational system. So, you know, if you wanna own a firearm, if you wanna drive a car, if you wanna be, you know, a beautician, and listen, we can talk about overregulation, you gotta take tests. Man, it would just be so much better if consumers could take, you know, like a 50 question test just to say, hey. They understand what we're talking about here in in terms of diversification so they don't yolo their entire mortgage and house into one crypto. So what are your thoughts on those two issues?

Disclosures, how it's presented, and then accreditation and maybe a path to accreditation, sophisticated investor test is how I refer to it, for all Americans because 90% of people can't participate in private companies. Your thoughts? Well, disclosure is the key. Like I said, I mean, these projects should have to disclose certain things. I think, for example, the token cap table should be disclosed.

Who are the Okay. Great. Who are the insiders? How much do they have? When are they selling?

You know, that's that's information the the market should always know, in my opinion. Easily done with the technology lauded by the crypto community, the blockchain. This could just be on the blockchain. This was always the problem we had as venture capitalists with, hey. This is a token project.

Who owns the tokens? Where are they? When can when can I sell? When can you sell? The insiders.

Yes. Yeah. And I don't think you have to disclose everyone who owns a token. That could be hard to comply with, but I think you should have to disclose percent. You should have to disclose the insiders and their their sales plans and their lockups.

And and and I would also say how new tokens get created. I mean, if this is a fully centralized token where they can just mint more, people need to know that because there's no scarcity. Right? But if there's somehow an enforcement mechanism and there's enforced scarcity, then that's a different story. So, yeah, these things have to be disclosed, and, by the way, I think the market structure bills will do that.

There's a version of this in FIT twenty one last congress. I think it'll be in the next one. And moreover, the SEC is looking right now at these rules, and they're gonna create their own frameworks. They're doing it in a nutshell. SEC chief.

I I was doing some research on him. He he he's a really pro actually, more Americans being able to invest in privates, private equity, etcetera. And he's given speeches on it in the past. So the person who's been nominated for the new chair of the SEC is named Paul Atkins, and he he has not been confirmed yet. The confirmation hearings still need to happen.

Separately, Hester Peirce, who's a commissioner at the SEC, is in charge of I know Hester. I've had her on, This Week in Startups a couple of times. She's great. She's excellent. She's very well informed.

And she's take very sharp taking the lead on all the crypto related stuff. So I trust her, and I trust the SEC to produce those detailed frameworks that you're talking about. Yeah. I think that my role as call innovation policy adviser is just to kinda make sure that we have the big picture right. And I'm I'm very confident that the SEC, the CFTC, and the legislators, they're gonna figure out the balance here.

Sachs, you gotta go. Really proud of the work here. Congratulations on filling this all up and presenting a really thoughtful plan that we can all ask you hard questions on. Appreciate you taking the hard questions here on, the all in podcast. And, good luck when you do the rest of the media circus.

I wonder if I'm gonna be the hardest questioner of you. I I hope so. And, for people asking, yes, I'm wearing a suit because I am now joining the administration. Big announcement. I'm the official podcaster, the official moderator of the, Trump White House.

I'm just kidding. People will actually believe you. Alright, man. Listen. I got I got a I got a good jokes.

But good to see you. Okay. Love you, brother. We'll see you soon. Cheers.

Alright. Bye. Alright, everybody. I'm obviously super conflicted. Sachs is my friend of twenty years plus.

We're partners here on the All In podcast. And, of course, I'm rooting for the administration. But, you know, I got that journalist blood in me. I always wanna call balls and strikes. I'm gonna, as you just heard, ask hard questions.

So if you're wondering where I'm coming from, I'm gonna ask hard questions to my friends because they're doing important work for the American people and for the rest of the people on the planet, candidly. These are important decisions that Saks is gonna have to make about crypto AI, that Elon's making with Doge. I'm gonna ask hard questions. That's the way it's gonna be. And so I'm really excited that they're coming on here.

They're gonna take the hard questions from me, but they're done in a certain spirit, which is, yes, they're my friends, but they got important jobs. So they do have to ask answer the hard questions for the American people. And I'm also curious, and we're all curious where they're coming from. So I feel so privileged that they're they're choosing to come on all in to face those hard questions. We'll see you all next time from the only problems.

We'll let your winners ride. Rain man David Sacca. And it said we open sourced it to the fans, and they've just gone crazy with it. Love you, guys. Queen of quinoa.

We should all just get a room and just have one big huge orgy because they're all just useless. It's like this, like, sexual tension that we just need to release them out. Get Mercies are back?

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Tariffs, Trump's Economic Endgame, Market Chaos, Bitcoin Reserve, CoreWeave IPO

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