Dylan, Doug, Jon on AI Mandate of Heaven + Ezra Beef
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Welcome to this week's episode of Transistor Radio. And unlike any other week we've ever done, we actually have good audio. This is honestly shocking. We got, almost called you John, we got Jordan, Dylan, and Doug in studio at SCSP. Shout out Eric Schmidt. We appreciate your lovely podcast booth.

Your dollars are hard at work. Yeah. And if you want to make them work harder, we have other ideas too. Okay? Hit us up at SemiAnalysis. You know where to ring us. You have my email. You got my email. Dude, the craziest thing is I one time had like an hour and a half long conversation with him on the AITCO while he was in his plane the whole time.

Dude, and his video quality was good. I was like, damn, I guess this is what rich people internet is in the air. This is what Starlink is for. Because, well, I think it was pre-Starlink. No, it was 23. It was probably Starlink, maybe. I don't know. But he was just flying, and it's like...

We got him all edumacated on neocloud stuff, but it was just really interesting that his internet quality was so good. Also, his seat quality. Like, it was such a comfortable-looking seat. Like, here's the thing, right? People talk about, oh, I want to be rich enough for a private jet. I also want to be rich enough for a private jet, to be clear. But these private jets, like...

There are levels to this shit. There are levels. There are, like, the few-billion-dollar, like, you know, shit tier. The irony, though, about the Qatari jet is it was, like, not good enough for their emirate.

And they were like selling it because it was used goods. What the heck? I didn't know that. Wait, what? Yeah, no. Like Trump's jet. Yeah, Trump's jet. They had it on the market for three years and they like couldn't offload it because no one wanted the jet. Is it like super luxuriously interior designed? No, I just think it was. There's probably like gold plated fucking seats, dude. He probably shits on fucking gold, dude.

Yeah, well, thank you. And the engineer was probably like, you know, well, if you make it a gold-plated seat, the toilet's going to be heavier instead of being a shitty plastic one. You know, it's going to be heavier. It's going to make our fuel economy worse. And the Qatari prince was like, and? Yeah. Wow. I'll take your passport if you don't do this. Okay. This is a very amazing start to this episode. Public service announcement. So we're trying to be the change we want to see in the world. Trying to put together a letter of...

that maybe we shouldn't cut basic science funding by half and maybe we should still have OPT and international students in America. Speak for yourself, you're USAID funded. I wish. I mean, no one, excuse me, no one is anymore Dylan. If you're an AI researcher and want to defend science and universities. I got to stop you. You know someone in our company, in our Slack, constantly, like anytime your name comes up, he's like, I thought he was gone now that USAID is pulled because...

I made that one tweet about you being USAID funded as a joke. And he like legitimately thinks that... Don't cry for me. Cry for the Malawis who are like getting malaria now. We need immigration. We need high skilled immigration. Like really fucking bad. And we need, you know, all these PhDs to be funded. I don't know if I told you. I think I said this on our prior Transistor Radio.

A girl I went on a date with, she literally had to cancel her PhD. It's like, now it's hitting close to home. Now it's hitting close to home. When it's brown women affecting Dylan Patel, all of a sudden, man locks in. He's like, okay, I got to find my PhD waifu. Everything's changed.

They're rapidly evaporating from the market. This is a crisis of national proportions. There's a billion person, maybe 500 million person pipeline in potential in TAM that is being cut in half. It's being murdered. Dylan's TAM is being destroyed. Brother, if we had 250 million PhD students, that'd be absurd. Yeah, that'd be, some would say that'd be pretty awesome. We'll get there. I don't think so because PhDs, by and large, don't do shit.

But they do a lot of fun research. But they do enough to create the future, which is what we need to preserve. I actually... Let me... Good bio PhDs, good computer science, good ML, good material science, those kind of PhDs, awesome.

Yeah. We're talking about stuff. We're talking about NSF. We're only talking about science. Math physics funding in 2025 is being funded at half the rate it was funded in 2024. There's no woke in that. There's numbers. So actually, I have an even hotter take, sorry. But PhDs are good for the economy because essentially they're slave labor.

Any PhD student you talk to, they get paid like, you know, stipends to work their little asses off to do all these researchers. And the only way we can compete with China is to pay them less and work them harder and make them all do PhD programs. So what we need is 100 million PhDs. That's the answer. Think about how good this would be for the economy, dude.

This is how we're suppressing consumption. It's just like people in grad school. Yeah, because here's what happens is like as China becomes a consumption-based economy, we have to become an investment-based economy. So what we need to do is we need to have, you know, miles and miles and miles of PhD bunk beds.

Okay. Here they're living in camps. They're not researching. They're assembling iPhones. They're assembling iPhones. Yeah. It's physical hand delivered. No, I don't know. Mechanical engineering PhDs now assemble iPhones in America. Yeah.

And hey, if they're 13 years old and they're child labor, that's fine. Yeah, it's like the back to the countryside theory of mechanical engineering. First, we will have you assemble iPhones for 10 years. Only then will we teach you equations. 100%. Let's go back to the actual topic, right? Which is immigration. Let's reform it.

Yeah. Yeah, yeah, yeah. Funding for science. Let's reform it. Yeah. We need... I mean, Jensen says 50% of the AI researchers are in China. This number is probably true. And my favorite thing that I keep psyoping and fearing people and this stuff is like, go to a STEM conference in the United States. It's a ton of old dudes who are in their 50s. Go to a STEM conference in Asia. And it's like...

I mean, you know, maybe because they're beautiful skin, you can't age them. But they're all, they look like they're 20-year-olds, as far as I can see, 25-year-olds. And they outnumber the white people by, like, you know, 10 to 1. And you're like, okay, maybe these guys don't know what they're doing today. Well, hold on. No one on this podcast is white, right? Because we've already decided that Jews aren't white, so Jordan's not white.

Welcome to Changes to Radio.

Anyways, in conclusion, if you're an AI researcher and you want to sign a letter saying we like immigrants and we like science and NSF helped you in your journey, DM me. I'm out there. Okay, but my favorite part about this is what? Is this transistor radio or is this going to China Talk? Because, like, you know, like all thousand of – no, I think there might be multiple thousands. Thousands of – I think it's like 10,000 viewers. Consistently? Something like that.

like that 3,500 that's just Spotify though right are we putting it elsewhere yeah John get to work we have a YouTube channel oh what wow don't talk to me until there's a TikTok right okay wow wait Jordan you know there's a China talk TikTok right yeah I know we got our clips guy he's right at work yeah

Okay, from what I heard... Shout out to Abraham. From what I heard, the TikTok was made without your approval. No, no, no. It's a sign of the times. That was fake news. At some point, it was made without your approval, and then you approved it. Neither confirm or deny, but I don't know. I was anti it for a while, and now I'm just a slave to the algorithm. Oh, Doug keeps telling me, like, hey, let's do social media, all this, right? I'm like, great.

But the one I won't allow is Blue Sky. We're not going on Blue Sky. So I want to do our quarterly AI mandate of heaven check-in. Last off in the D tier, we had Meta and XAI. Any updates on either of them? Meta stays there, but XAI is moving up. Yeah, XAI C tier. Rock 3 was fucking fire. And, I don't know, Meta just stays in the D tier.

Yeah, RIP. I'm hopeful, actually. I've heard some good things. Hope springs eternal. Since the deep sea catastrophe and the metaphor debacle, Lama 4, I've heard about a lot of good things. And they've got enough money to keep taking swings. It's not like they're going to throw in the towel any time soon. You know what I also want to say? Okay, let's be clear. We've got to add Apple to this, and Apple is an F minus, minus, minus. Yeah. I guess there is no E tier, right? We'll just do F tier.

Okay. Or L tier, how's that sound? Yeah, I mean, at least they're on the chart. They didn't even make it last time. Yeah. So this is kind of an upgrade. We remembered them this time. Yeah, yeah, yeah. It's only because you've been staring at your iPhone for the last 10 minutes trying to bring up this topic. Yeah. Doug and I go off rail. Okay, so another thing, too, let's specifically say, it's not like Meta doesn't cook. They're just, like, cooking in a way they have incentives for. A lot of the GPU spending on Rexus, specifically for their algorithms, are, like, definitely paying off.

There's a lot of ways to measure this, but, like, CPM magically continues to go up, which it shouldn't if there's more impressions. Like, their revenue from the GPUs that they are essentially shoving down into these giant, you know, and MTI and stuff like that is... It's helping. Revenue isn't... Not inflecting, but it is, like, getting less. Also, like, more than... Like, what? Like, 60% of GPU spend is Rexus? We'll just say 50-plus. Yeah, so...

Half plus. Rexus for the uninitiated. Recommendation systems. So what story shows up first when you open up Instagram? Why is it the girl that you have a crush on? What post shows up? Why is it the meme that has alt-right tendencies? Why is the ad that shows up one about how to last longer in bed? It's like this is all the Rexus. How do they know your secret unspoken desires just from one glance?

Just from one pause on a feed. God, everyone's going to think that's my actual Instagram. I don't know. I can confirm. I can confirm. You did say it was unhinged. It's an unhinged feed. Actually, you know what's funny is Rake, one of our analysts, he was scrolling through his Instagram feed and he saw something that I liked and he's like, dude, this is the most unhinged brain rot I've ever seen. I was like, yeah, dude, you want to see my feed? I just occasionally send stuff to him, but he's like, what the fuck is your problem? I'm like, I don't know.

So, yeah. But, like, our Gen Z analyst, he's like, dude, what the hell is this brain rot? And I'm like, what's up, dude? Doug, it's aminosus. I love the brain rot from. But that's where all those GPS are going, to feed and give you your nourishing brain rot every single day. True.

Which makes sense. I mean, it matters more than getting Llama right. Yeah, it's Slop. The engagement Slop works. The incentives are showing. Define the difference between Slop and Brain Rot for those in the audience who don't understand. Honestly, I couldn't, but I understand the difference. I think Brain Rot's more addictive. I think Slop you can notice and move away from. Yeah, yeah, Slop you're like, oh. Is Brain Rot identified? I think Slop is a broader category and Brain Rot is a subcategory of Slop.

Okay, in the slopiverse, which I really want to term, like, I think AI will create the slopiverse because it's going to create so much slop. Like, so much slop. More than you could ever imagine. Do you think we'll ever get to a point where, like, slop stops growing and we may call it, like, sloppy toppy? Like, I don't know.

Fucking Christ, Dylan. All right, I got to transition. Can you put an analyst on this, Dylan? Can you put an analyst on this? Speaking of the slopper. The slop analyst? Speaking of the slopper, in C tier, we have Google, who I feel like needs a little boost at this point. And we got a big... Yeah, we'll give them B. Is that A? 2.5?

2.5... Google? V-O-3? I was gonna say Google's S. I would say A or S. I was gonna say Google's S, bro. Okay, wait. Wait, wait. I thought we were doing... I was fucking sick. That's fair. Okay, I forgot, but V-O-3. They're A. They're not A. I don't wanna go. Yeah, yeah, yeah. We'll go A. We'll go A. And then they have like an... Can you show us the... An A+, like, you know, if we're... Yeah, okay, sorry, sorry. All right, so should we just recap? All right, so last time we had Google and DeepSeek in B tier, Anthropic A tier, and OpenAIS tier. Yeah, we'll definitely do A tier.

Yeah. I think this is really tough because Cloud 4 is fucking fire. So Grok is B, definitely up from C to D. Meta is still D. Apple is introduced to the L tier. But then OpenAI, Anthropic, and Google all are doing really well. Yeah, we had a great month. We had a great month. Well, then the problem is OpenAI didn't release anything, did they? This feels like inflation, though.

Can everything be A? We need one king. We need one company with the mandate of heaven. I think O3 is still the fucking best. But Opus 4 is incredible. And then 2.5 has just like

Done so much. 2.5 is the Pareto curve for really freaking cheap and good. There's a chart that we have or whatever, we publish it somewhere in one of our products talking about how the price to performance, Google is always on the curve, essentially. They set the curve of the best possible performance at any given price. But nowadays, their performance is only N-1. They don't have an O3, Claude 4, but they have...

They have like 3.7 tier coding. Yeah. Right? Yeah. And no one's got anything close to Vio. Yeah, that's true. That was a fun five-hour rabbit hole dive. You spent five hours with Vio? Yeah, man. Wait, wait. So have you uploaded images of yourself and then said turn it into a rap video? It's so good.

Wait, when I was using it, they only let you do that for VO2, not VO3. I didn't, but someone else did and sent it to me. Okay, okay. Well, they emailed it to me, and the best part is, like, Michelle thought it was noteworthy, so she put it in my Slack DMs, and I'm like, what is this? And she's like, oh, Dan sent it to you, who, like, works at Google, and I'm like, okay. Yeah, because, you know, they don't have that feature public. You can't, for VO3, you can't give it. Like a prompter. Yeah, you can't give it a, you can only give it text prompts, not video or image prompts.

Which has been really frustrating because, like, I really wanted to have Ezra Klein interviewing Mao as, like, the ultimate Ezra Klein video podcast. And it only let me do that with VO2. Okay, also, so, so, so, so, so sorry. The B tier. Is anyone in the B tier, then? I think Deep Seeker and Grok are in the same tier, even though Grok's model is...

No, and it's no longer better. Oh, fuck. I forgot. R10528. Yeah. Jesus. How dare you? I was about to say. We kind of skipped all the Chinese players, didn't we? Yeah, I was going to say. Are we going to add? Alibaba C. Yeah, Alibaba C. Deep Seek B.

Or maybe A. Fuck. I know, but that's what I'm saying. There's so many A players, the inflation's insane. That's what I was saying. It's like, we gotta... But, like, because, you know, the target is average as, like, C or D, by adding, introducing Apple as an L, you know, we...

We've maintained that. We're getting more space on the high end. You're right. You're right. The barbell's correct. Okay, okay, okay. Well, we should add the Chinese players. So we'll do Alibaba and then... Alibaba C, I think, is fair. Yeah, Alibaba C is fair. Because Quen is currently better than Llama, but it's not, like, absurdly better. It's just, like, really better. But it's improving at a scary rate. Deep Seeker, are they A now? R10528 is...

So we have three A players and an S player. Is that what it is? Yeah, but I don't think DeepSeek is as good as Cloud4 or Google's models. But they don't have... But they're constrained on compute. Because of the removal of diffusion, they're now renting GPUs in Thailand, in Malaysia,

In other... In the US... Or, sorry, in Europe as well. Yeah. What's the... What's the... Is there a ByteDance model on my phone? A ByteDance what? A ByteDance model? ByteDance has models, yeah, but I don't know what they're doing. Yeah, because I thought... They have a product, but I don't know if they're... I know they have a product, yeah. I've never seen evals for their models. Yeah, but, like, you'd think with all the... Maybe that's just... Well, no, it's like... It's like...

It's like a Facebook S dynamic. Also, just to be clear, the character on Transistor Radio slash Chinatalk is just a character. I'm a normal person. Yes.

Sorry, that was too easy. No, no, no. I could be professional, man. I even have a blazer today. He does have a blazer. It's not a... You got another topic? Back to Tencent. Back to ByteDance. Oh, Tencent. Bro, where's Tencent? Yeah, that's what... Okay, so yeah. Tencent... Tencent, ByteDance are like... Tencent, another L to them. Are they L? Are they L? No, I think they're better. No. Ernie is Tencent, right? Tencent just adopted DT stuff, right? Ernie's Baidu. Oh, Baidu. Okay, Baidu we'll put like below... We'll put like F tier. D, F...

Yeah, I think Baidu will put F tier. Again, that's a promotion. If you're Baidu, you weren't on the list last time. You should be proud of yourself. Why are you pandering to Baidu right now? Dude, it's China Talk. He no longer has USAID funding. He has to get funding from the big fund in China. Oh, this goes on China Talk. Sorry. Anyways, yeah, so Baidu is now. Yeah, and then who else we got? What's next for opening up?

I mean, you can't go up from S, right? Cooking GPUs? No, but they got real competition now. We've got... O4's going to be a banger, bro. Okay. Do you know... I heard some stuff yesterday about the successor to... What about? To Orion. Yeah.

I'm excited. Okay, yeah. That was actually my question. When do we know is the next big run? I mean, it should be like... I mean, they're just doing RL runs constantly, right? Yeah. They have a pre-training run as well as a big RL run. Yeah, I mean, I think like 04, the scale of compute for those runs is still quite small relative to the size of an Orion pre-training run. Or not quite small. It's like getting up there, right? Orion being GPT 4.5, being the most expensive training run

Is this Middle East stuff? It's just all inference, right? You can't train a model half in Texas and half in the UAE. Really? RL from our scaling laws post where everyone was like, oh, scaling laws are dead. He's like, no, you idiot. They're not dead. Pre-training, hard to distribute across continents. You can do it across data centers. You have to get loads of fiber between them. Yeah. Right? But...

Hence, like the 10 plus billion dollars of deals with all the fiber companies, at least companies have done. But with RL, right, reinforcement learning, verifiable rewards, you can do the

the token generation and verification in anywhere in the world. And then you're not streaming weights and activations. You're streaming just final tokens, uh, that were verified. So very little data relatively right. And those tokens can be, uh, today they're texts, but they can be actions, images, videos, et cetera, as well as we move forward. But like, yeah, you can stream this across data centers and the bandwidth requirements are not that insane. And so, um, open eyes totally going to train in the middle East, right. For people who don't, uh,

And they're not going to do pre-training in the Middle East, but they're going to generate tokens and verify them in the Middle East and then send them back. Should we recap? Yeah, recap it from the top. OpenAI S tier. Google, DeepSeek, Anthropic, A tier. B tier has no one. Oh, it has Grok. Yeah. C tier has Alibaba. D tier has Meta. F tier has ByteDance.

L tier has Apple. Yeah. Oh, we forgot Baidu also F tier, right? Yeah. Ernie? No, I think Baidu's worse. I think Baidu's worse. F tier. Yeah. L tier is... Where does Mistral go? Somewhere between L and F. No, we'll give him F tier. Okay, fine. We'll give him F tier. We'll give Mistral F tier.

F for frames. All right. Lock that down for next quarter. Let's get some Doug Dillon DC impressions. How's our... We're dealing in real life. How's our national security establishment? So we hosted a event yesterday. Oh, yeah. We had like 125 people. It was sick. It was great. Great energy. And it was an event that we didn't have to pay for, which is great because it's interesting because this one was free, you know? Yeah. And I do think you get what you pay for. I'm just kidding. It was good. It was good. It's called Distributed Meetup.

No, no, no, it was good. I was at a beer garden. I think there were a lot of people who believed that the Senate bill for... Chip Security Act. Chip Security Act is a good idea, and I think they're all completely wrong. You want to go through the reasoning? But to be clear, my vibe from the chip security thing is it feels like it's happening. That's all I got. So in and of itself, it's actually not a bad thing. It's just useless, right? Like these things won't actually work.

Phoning home doesn't work. You can spoof that super easily. Re-exporting is super easy. They're like, oh, but the first time you turn it on, it'll phone home. It's like, yeah, the first time you turn it on, it turns on in China, and the IP tunnels to wherever the fuck you want in Europe or Latin America or Asia or Middle East. By the way, my impression is literally the plan is, yeah, they know they're going to not...

they're not going to catch it, but they just need someone to mess up once and they're like, see, there is smuggling. That's why we need even more tighter controls. So I think it's the flip side though, right? Like, which is, we already know they're smuggling. To be clear, to be clear, but that's, that's like, and agreed. Yes, there's clear, like you can just go take a flight to freaking China and you like create

Crazy. Did I tell the story about how the, there was a guy who flew first class constantly back and forth between China and he'd take one server with him every single time or two servers, check them in to take a first class flight. You buy the server for like two 40 K here and you sell it for like two 90 K there. And you're like 50 K richer. And your first class flight is like five.

Easy. Yeah. The people who believe in the chip security act because NVIDIA is just going to use that as ammo to reduce restrictions. And even though you think idealistically that's not going to happen, that's what's going to happen is you're going to pass this act and it's going to be ammo to reduce restrictions in other ways or not ratchet them up further. I have a question for you.

So can they be making... When they were spending all this time making the H20, was there not a way for them to... Was this just a way to keep market share in China, or was that actually a profit-maximizing use of wafer capacity? So the margins on H20 are lower than on H200 or H100. NVIDIA literally makes...

It has a higher markup for non-Chinese customers than they do Chinese customers. Yeah. No, obviously, their pricing to value in the H20 is weaker than H200, right? So why are they even doing... I mean, it's just like a long-term play to... They still make a lot of fucking money. They still make a lot of... Like, hey, you too would take $8 billion and a quarter. But...

If I turn those into H100s, would I not make... They wouldn't have sold them. They wouldn't have sold them. Okay. Their operating profit from just Q1 was like $5 billion, dude. Yeah. From China sales. And if they didn't have to write down a shitload of inventory, Q2, they would have sold like... They would have had like $13 to $15 billion of revenue, and they would have had like 7, 8 of fucking operating profits.

So, and remember, that is larger than the 50th. Intel's profit for the last decade. That's literally a top 25 S&P 500 company.

Okay. Well, my favorite is that AirPods alone are a fucking top 10 S&P company or some shit. But to be clear, so why could they have not... There's not demand out there for H1Huts? There's not data centers. There's not data centers in power. When you're selling to the world, at some point in time, your TAM is the world. And so you just lose part of your TAM.

you can like, like, and, and it's not, and this is like a, this is a statement of like, there isn't a shortage of making chips like TSMC. Like it's not even like the biggest customer. Maybe it is, but closing. No, I don't even think it's closing in on the biggest customer on a wafer basis. So it's just like, I think they'll be biggest customer.

For sure next year. Next year, for sure. I got to look at the models. Anyway, but they're just like, okay, well, we can get more and we can sell more to someone. And it isn't the highest profit margin, but it's like you can't really sell H... And we've had all this work on H100s, like specifically right now. H100s are in this ridiculous bathtub. You're going to be underwater if you purchase them. So everyone is waiting for the bees. Purchase them and rent them out. Rent them out, yeah. And so everyone's just waiting for the...

the Blackwell series. And so, you know, NVIDIA is shifting it. They have some, like it's depreciated, not a completely depreciated supply chain, but like a very cheap supply chain. And you're like, you know, it's like this thing where it's like, you're trying to maximize revenue. Everyone's shifting orders elsewhere. There is a second market. Like, yeah, it's not as profitable, but it is also not a jump. Like your optimization for maximum gross profit dollars is you should be selling to China as well. NVIDIA is not evil. They're just profit maximizing enterprise. Okay. Fair enough. Yeah. Yeah.

Which is a good American trait in the Church of Capitalism? All right. We got 10 more minutes in this booth. We got to make the most of it. Okay. We're beatboxing? Yo, welcome. We on China Talk today. That's for you, Jordan. Nice. Jordan loves beatboxing. That's a fun... That is my favorite. I went to Jordan's birthday. You know, got to see a glimpse into his friends and family. Not that I'm one of his friends. But, you know, I got a really great little invitation. It was awesome. And everyone...

like, was like, oh yeah, Jordan loves beatboxing. I was like, what? Yeah. Like, and not loved beatboxing, like, like obsessive drive to beatbox. And I love that because now it's just all spent in, in trying to talk. But in another life, he, he's doing beatboxing. It was like an amazing, like eight to 14, um, ADD, like substitute. And, and who, who here doesn't have ADD?

In this podcast, it's John. So since being in California a lot more now, I constantly hear people like, over here, people like, oh, I'm ADHD. Oh, I'm autistic. And I'm like, no, I'm neurotypical. I'm mentally stable. What is wrong with you?

I will say, man, you say that, but dog, there was this one meeting we had where I was like, Dylan is the single most ADHD human being I've ever met. Unmedicated, though. Well, no, no, no, because there's the Elon tier of like you do it and then you like take all the drugs to lower whatever your latent like attention, which is already degraded by 30 years further. So I think that's like...

truly the next level sure okay i just to the cause i just i just gotta say i will i will not hear dylan slander himself in zay's neurotypical no i'm super mentally stable though like you're you're like far less than the two whoa whoa we're throwing them stable genius literally jokes about yeah i know i know yeah no no i know i know i'm mostly meaning anyways uh yeah sorry the anxiety is real at uh everyone around me at second analysis has way more anxiety than i do

Of course you do. You're the boss. No, but, like, it's about things that aren't, like, worth being anxious about. I'm with you, man. I don't... The people with the anxiety, I'm just, like...

You don't need... Like, no one's making you. Like... Okay. Like, I... If you're anxious or not, it'll still happen. Like, just do it. I do agree with that, but there's some times where... Let's not have this conversation right now. There's sometimes you do have to care about some things. And, like, recently I haven't had... You don't have to care about some things, but, like... I also... It doesn't help anyone to get anxious about it. You're healthy now. Worry about that. Now we're not. There's some context, dude. I can process and... I can process stress now that I'm healthy. Okay. Like...

That's fair. I could not process stress until very recently. I'm much happier, respectfully. Great. Wonderful. Can we talk about just the being in person energy? Like, I totally get it. This is great. This might actually be one of our best podcasts because the banter is pretty solid. There's just no lag. It's like we're just...

There's no internet issues. Audio quality is good. Audio quality is almost too good. Fuck you, bro. You're not even here. Yeah. John. You didn't fly out for this? Yeah. What? You didn't fly out for this conference? God. I'm just listening, man. I'm the first to listen to this podcast. He's actually the first listener of this podcast. That's really fucking sad.

We have a live audience. Can you give us like a live audience sound? Like a sitcom? This is a sitcom, John. Yeah. That's a pretty weak clap. But okay, you know, let's actually take a question from the audience. John, what do you got for us? We have one more content push. To the handsome man. To the handsome man in front. Over there.

Yeah, you know, John from New York, age 22. I'm just wanting to know. Why do you sound like you're 60, bro? You sound like you're 65. That was your Gen Z accent. You sound like if you took all of Doug's stress about work and Jordan's stress about missing airplane flights and put it into someone for 22 years, that's that voice. Okay. Okay. But we ragged him before he got his question out. What's your question, Mr. John? Shit, man. I forgot it, man.

Okay, she hit. Dude, I'm like catching a train right after this. I'm going to sell one app. I need that drops of alpha for the actual listeners who have stuck through this whole thing. Oh, yeah, yeah. What's the drops of alpha? I only have like something from this conference. I only have one obsession weird thing. It's not.

Pete Hegseth, actually good. He, like, cares about the Allies in the Pacific. At least that's, like, half of the world. I'll take it. Better than caring about none of the Allies. Dang. Shout out, Pete. Shout out, Pete. There's things that are helpful that I don't want to share, but I guess, like, something that... AMD's got a big new customer that I'm really happy about.

That's extreme alpha. Wow. Jesus Christ. Okay. Doug, yesterday I heard someone bought a house. Tell me about this story. Someone told you? Oh, my God. Sorry. So essentially, you know, love the listeners out there have been told, hey, fabricate knowledge, knows what he's talking about, great stuff, appreciate the hype. But the best thing I've ever done for sure was the app loving call that I did on yet another value blog.

Which was not a, yeah. That was another podcast. It was like not a Semi-Huggers doc. You had a separate sub stack for a little bit. Yeah, yeah. Actually, I gave it to my friend. He still does it. So TLDR, Applovin, greatest pitch I've ever made. I made a lot of money from it.

Um, once upon a time, it's like an ad tech company. It's very sketchy because they make the mobile game apps. They're extremely gamified. You talk about slop. They're like king of slop averse. Oh yeah. These are the ones where you can't actually exit out. Yeah. A hundred percent. Like there's an X button. You click it and it fucking goes. It's an impression. It's a fucking click through and you're like, you fucking bastard. Yeah. So anyways, all in all this ad company, which owned a lot of their own games, everyone's like, oh, these impressions are all fake. Uh,

They did this exceedingly ridiculously aggressive compensation thing. You had another value blog. I talked about it. You can listen to that whole thing. It's pretty good. I pitched it at like 13, 14 bucks a share. It's a $300 stock right now.

And so that's awesome. I made a lot of money. I think my average out was like, my average out is like probably mid 200s, low 200s, something like that. I made a lot of money on calls multiple times. But someone made a lot of money on calls. Like a house in Europe money on calls. Wait, wait, that's only like $200,000. Yeah.

No, like a $2 million... Oh, like a true villa. Like a villa. Actually, that's what someone said yesterday. They said villa. And like, okay, I believe, if they were a listener, I believe they were a listener, that I have a standing offer for a nice dinner in New York. Appreciate it. But man, does that create some FOMO. Because you know what? That could have been me if I just yeeted my entire life into calls. But...

Here I am. I tell everyone who listens, I do it because I love the game. I could have retired, but I'm here because I love the game so much. I don't want to quit. Oh, I could have retired. Dude, the 15 to 300 thing in conviction with size, with enough options, you could have retired.

In general could have retired. Oh, like if you had went YOLO'd in. Yeah, yeah. Oh, okay. Sorry, sorry. I thought you meant just generally you could be retired right now. Yeah. No, no. I don't think – that's what I'm saying. I do it for the love of the game. What do you think I'm going to do, huh? If I have a lot of free time, all of a sudden I'm going to be like, oh, this is something really interesting. And then all of a sudden I'll be like, maybe I'll start writing about this on the internet. I was like, oh, maybe – like literally I talk about this with my girlfriend. She's like, dude, you can't retire. You're just going to be like really obsessed with something and all of a sudden be like,

Babe, I have to drop my entire life and go do XYZ. And that's probably what will happen. But yeah, Apple oven. I got to say, I don't have a villa in Europe. And that makes me a little sad. But I do it for the love of the game. Yeah. Yeah. I don't know if that per se dinner is going to make you feel better or worse. I'll always take a free dinner. You got to hustle, man. It's called cash on cash return. I didn't pay for it.

Should we call it there? Yeah. Yeah, we'll call it there. Thank you for listening to the Transistor Radio Try to Talk crossover. Once again. Live. Live from SCSP.

Plus John, our first listener. And don't cut everything out, Jordan. Yeah. Sorry. The censors. I can feel your censorship. This is China Talk because it's highly censored. You know? It's like it's as if we were talking in China and then the censors were here except for he's also on the podcast. It's just, I'm like PG-13, okay? Okay, so can you leave the stuff about us talking about the censorship at least? Is it okay to title this Sloppy Toppy? Yeah, yeah. Just throw in some blur, some beeps, dude. Yeah, throw in a beep. Serving beep.

If you want... Sloppy? No, no, add the beeps. Add the beeps. Jordan, that'll be so good. Come on. Just every four words, be like, beep, beep, beep, beep. No, we didn't curse that much. Yeah. There were like five jokes. No, there were like four jokes. Yeah, yeah. All right. I'll see if AI... There's now like an AI feature in my editor where you can just tell it to do things. And so if I can say, put the beeps here and the beeps emerge. Oh, good luck. Then we'll keep it in.

You should put some beeps in. Yeah, it's tough for Jordan to have a full-time video editor, podcast editor now that USAID cut his funding. I'm open for business. What can I say? Sign the letter. DM me. Save science. Why don't you do Chinatown podcast ads? What?

People need to buy the ads. He's selling. That's what he said. I'm selling ads. He's trying to sell ads. Buy the accelerator model. Buy the data center model. Buy the AITCO model. John's fucking Patreon. John's Patreon. Oh, John's Patreon. Yeah. We should have a special interest, too. What does that mean? I don't know. Some charity. Probably for autistic people. That's semi-analysis as well, actually.

Wait, wait, wait. One last thing before we sign off. Yesterday, Doug said this, and I was like, wow, this resonates. He's like, you know, semi-analysis is like... The home for lost toys. Which is such a good analogy, because we're all just lost. We're lost toys, and we're all beautiful, beautiful toys. A little broken, but pretty good, anyway.

and fun to play with. Can you imagine the delta of what we've just recorded over the past hour versus whatever the hell else is going to go on in this podcast studio over the next three days? Yeah, they're going to be like, what do you think? Well, the thing about China and AI is that it's really dangerous and we need to do something soon. It's like, I completely agree.

I'm a 55-year-old congressional staffer. I'm a 20-year-old congressional staffer who did PoliSci. Obviously, you can restrict chips to China by just putting the software on them. And I trust NVIDIA to make the software work perfectly. And I trust China to not be able to crack it. Let's make a bill out of it. Dylan, okay, so my trip in D.C., I'm not joking, that was like the way more interesting conversations happened.

There's like way more boring conversations where they're like, this could impact everything. Well, the fact that you don't know who Ezra Klein is, Dylan, I think is like, I want to keep it like that. This is a good, this is good for you. It's good. I know who he is. I've never primarily or secondarily consumed his content. Wow. Yeah.

I know that I can just see Jordan's little brain blowing up, but you also don't know. We've read semiconductor textbooks. I'm trying to think of like no time for just like who would be like the equivalent on my side. There's probably some finance weirdo sicko. I mean, Matt Levine, not knowing who Matt Levine is. No, Matt Levine is like everyone knows Matt. Yeah, Matt. Well, way more people know who Ezra Klein is than know who Matt Levine is.

No shot. Can... Can... Oh, what... Name one notable thing that Ezra Klein has done. He literally got Biden to drop out. I thought that was his, like, brain damage. Well, no. He was the first person who was screaming about it. It wasn't the Republicans? No.

Republicans? No, Republicans probably wouldn't want him to stay in. No, they want to keep him in. Yeah. No, I thought they were constantly like, Biden can't run. He's mentally unfit. Yeah, and then once he did the debate, they want him to stay in. They're like, oh, oh, like the people voted for Biden. They didn't vote for Kamala in the primary. So, Ezra Klein is some liberal left wing, sorry. He founded Vox. He,

Is it Vox dead? He fucking sucks. Yeah, no, he got out while the getting was good. He sold his shares. Or maybe he didn't sell his shares. I don't know. Vox is like still alive, which is, I'm happy for them. The YouTube channel is fine. I literally haven't consumed Vox either.

I've just, like, truly just completely hands up. I just don't consume that type of food. This after conversation can be just as good as our regular conversation. Is this still recording? Yeah, I hope so. Yeah, we're still cooking, dude. This is the after show, actually. Welcome to the after show. Yeah, what is life as an educated person who doesn't consume as reclined? I don't think I know... Like, there's...

Dude, I read books and I learn about finance. You want to know my obsessions right now? I work on useful shit. Yeah, work on... Like, you're semiconductor stuff. What is the point in reading about politics shit? Like, it's a waste of time. Do you disaggregated... Whatchamacallit? Pre-fill? Pre-fill, yeah. I'm learning about that right now. I'm learning about SMRs. I'm learning about, like, defense funding in Europe or crap. I'm learning about, like...

3D printed crap. I'm learning about some printer thing. I don't know, but some people got to save it. You can't save it. You're taking a class-blowing class. Like, come on, bro. Oh, Rheinmetall? Is that what I just heard? Is that EU defense? Yeah, Rheinmetall. Yeah, I bought a bunch of Rheinmetall. Oh, it probably works. Oh, you're really late to this. Yeah, a little bit. I mean, I was a little early to this one. Everyone's like, oh, isn't Europe spending going to go down when the war ends? I'm like, it's a low percent of GDP. Honestly, John, I personally really like the Japanese guys now. 7011, 7012, 7013.

What is it? Those are the... Wait, first of all, why are all the tickers incrementally plus one? So, Jay, I actually, I have, okay, actually, you want to know one of my things I did? There's a Japanese company handbook, and I read it, like, maybe 75% of it. So, you know, you read through them, and you know the tickers, but actually, there was originally supposed to be order from the thousands to the 9,000s. Oh, it's like NAIC codes. Yes. Wow. Jordan, do you know NAIC codes off the top of your head?

Yeah, you fucking read Ezra Klein. Obviously you don't. Yeah. I actually don't know any of that. Actually, I know a few of them. This is a little fucked up. But, okay, so there was originally supposed to be order, okay? The ones are actually builders. But then all of a sudden there's like a builder software company. And then they're like, this is a building company that pivoted to whatever. The twos, I think, are like food and retail. The threes, I think, are like materials, like just general like coal stuff. But, yeah, anyways, there's like order to all this. But then they all became computers.

Yeah. Exactly. And so there'll be, there'll be like little like streaks where like, like all the sevens are heavy industry. Like these, like, like maybe a hundred companies in a row. And then it goes back to like a farming company. Like it just, it's really weird and spaztastic, but you can see in the beginning how the order began. So the defense company is 701, 702, 703 or whatever the heck. Yeah. Yeah. Yeah. Yeah.

Two, three, what do they do? One is Mitch BC Heavy Industries, so they also make turbines. But they also do the missiles, and they also do a lot of missiles. And then number two is a heavy shipbuilding LNG company, but they also have some of the engine parts for GE. And then number three, which is my favorite, 7013,

does some nuclear crap, loses a crap ton of money on another business. And then on top of that, they also do shipbuilding. But the thing that's more interesting is like 50% of the revenue makes negative profit and they gave the commitment to quit. They're like, I'm out. What is that business?

Oh, dude, they're like all over the world, the random stuff. There's like an agriculture business in there. I don't even know. Like, I was explaining. It's my favorite stock. I don't know what half the company does. No, no, no. This is the Japanese thing. It's like they just didn't care about profit for decades. 100%. And so what happens is they have this giant conglomerate that makes no money. But if you sell... Like, the math is really great. If you sell or stop making no money, you make a lot of money. Like, that's it. And they actually said...

We're going to sell and stop making no money. I really like one and two. Three is like whatever. Like that's a finance bro pitch. But one and two are like, damn. No, but they also do. They also do. And then, yeah, there's like missiles and shipbuilding and Japan's like rearming. And they're also selling their stuff to other people. And there's another company in Korea, Hanwha, that does rearmament. Hanwha does rearmament and TCP bonders? Yes. Yes.

Bro. But these are two different companies. The synergies. There are two different companies within like the Hanwha. Like the ticker is one though. No, it's two different companies. No, no, no. It's like a chaebol. It's like a chaebol. It's a chaebol. Hanwha is a chaebol. Yeah, there's like a Samsung. It's like the Samsung family. Also, you don't make money in the Korean markets. Yeah. Yeah, Korean markets are not a scam, but...

Who knows? Okay. Oh, Mitsui book. I'm going to pitch that. Dude, the Mitsui book, man. I really enjoyed the first half, and I just kind of ran out of steam. That's fine. It actually got... I know you were all stoked about it, but I like ancient business because the new business stuff, I'm like, okay, whatever. Fine. I kind of see how this works. Yeah, no. I think by 1900, it sort of...

Yeah. Because then it's just like, yeah, they were like criminals and like killed a lot of Chinese people. Yeah. Of course they were. Yeah. Yeah. It's like, oh, crazy. I'm more interested in like ancient business. Does that make sense? Yeah. Like they're talking about how like they had a giant reorganization of this business in like the 1800s where they're like,

we have to scale out from one family into many family. And then they like all made P&Ls and all this kind of stuff. And like, and then they actually like, like the concept of professional management and like accounting. That was really interesting to me. Because like, that's like ancient business. Like as far as I, like I have no viewpoint into ancient business. Like there's no,

annual report about how to run a business from the 1700s. And that's as good as I got. And I really enjoyed that part of it. Yeah. And the whole like trust thing about like how you hire the managers, which are all sort of like children or married into the families. And then you like adopt the good ones to like become sons, even if they marry your daughters. I mean, it's this fascinating, like. Dude, that's a, that's like, I'm sure you can talk. Wait, are we talking about caste systems? I zoned out. Jesus.

No, no, we're talking about the... No, no, there were cats because they were like fallen samurai. Yeah, no, they quit being samurai because they literally... One dude was like, I see that the future of war is through business.

until he, like, quit his samurai thing and became... But then also on top of that, they, like, literally, like, funded the Tokonawa thing, right? Yeah, that was awesome. Yeah, they were, like, the banker that pushed it through. Like, whenever they're, like, resettling all the debts, they essentially were, like, the one that got to do the consolidation slash ended up being the... Yeah, no, it's really cool. It's, like, very...

Banker slash, I don't know. It was, I really enjoyed the ancient business part of it, but the more modern it became, the more I was like, yeah, this is boring. I don't care what like, like one random insurance from like a fire or like, yeah. Shout out Mitsui Empire. Yeah. Check out the book. It's great. And if you go to Japan, Mitsui's everywhere. Yeah. You see the sign. Yeah.

You're right. It's better than Ezra Klein. This book's way better than Ezra Klein. Yeah, see, like, dude, this is your intellectual brain rot. I've never read anything about this guy. Well, he was on my show, and he kind of broke my heart. Wait, Ezra Klein came on your show? Yeah. Holy shit, you had guests less relevant than us. You're welcome.

Dude, I'm going to hate on this guy so much and never consume his content. This is going to be a part of the brand. I am so here for the Ezra Klein, Dylan Patel beef. Also, I was going to say, I hope there's beef and Ezra gets really into it and Dylan's like, who are you? I don't think about you at all. I'm pretty sure neither of us would think about each other because I focus on industries that matter and he focuses on, I'm not sure.

Lib feelings. I think that's his main line. Dude, there was a... What's that guy's name? Bill Mayer or whatever. What's his name? Yeah. Bill Maher. Bill Maher? The TV guy. Yeah. I saw a video of him. It was pretty banger. Like, apparently left-wing people think that the Palestinian flag is a symbol of freedom. I was shocked.

I mean, not that, like, I think Palestine shouldn't be, like, genocided, obviously, but, like, you know, like, also, like, you know. I'm gonna... You gotta edit this out. No, no, no, no, no, no, no. I was in Tel Aviv earlier this month. I'm writing a write-up. I feel like I can't do off-the-cuff Israel talk, but I can write Israel. I also like Israel, you know, just to be clear. All my homies. Look. Yeah, it's really tough. I can feel Jordan tightening up here. I got all this ice on my neck, man.

But it is real, right? All this jewelry is real. It's real. Oh, I thought you were going way more anti-Semitic with that. I'll take the puns. It's just real. This gold on me is real. Oh, my God.

Okay. Honestly, we had a pretty good podcast there. It was a really good podcast. Nothing cancelable, right? I gave the most middle-of-the-road take possible. No, no, no. It's just more about the flow into the splat. And then we're like, see you later. It was nice listening to you on Transistor Radio. And China Talk. And China Talk. Where it's censored. Yeah, censorship talk.

I'm President of UN. Bye. Bye. Bye.

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Oh shit, I got a cold with rum Two cups of tonic and a glass of coke I'm going to the gym, I'm going to the gym

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