E112: Is Davos a grift? Plus: globalist mishaps, debt ceilings, TikTok's endgame & more
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Check out you have a really long .

knows here. Thank you .

on your left one.

Yeah OK you.

So we have this issue.

Every show he's got all this like.

i'm getting old men here is I like hacks.

You got a grooming .

tool. I am i'm going to .

get IT you just looking .

at mira and you come over .

on the way to Parker freeborn and to help me Manda cape.

you're not coming.

Don't come to poke. I just if I mask cape, can I to. We can give.

We source to the fans and .

they got razing.

Okay, so j, you're gna be a participant today. The worlds greatest moderator is taking a week off to allow his voice to recoup, to recover to here so he can come back blurring with his usual mid sentence interruptions and excEllent moderating tactics.

Next week, with ordination.

we to miss .

moderation in the world.

Hold on. Who should be thinking? whom? Even in years, I walked in here off the street of the somewhere top twenty.

Yeah, let me explain something to you. Number one, blog in the world I created with my guys engaged. Okay, top five magazine in the world.

Then I do a pocket with you. Three at its and over. Something dropped down to top twenty in this medium.

What you talking about? Yeah.

exactly. drop.

This has has been A B tested.

Now, I mean.

this way can pares you but .

look at twist rings compared to ours. You wanted this show to be. This show is about all topics.

all top about you. Every time we try to talk politics, you're like it's too much politics.

Sex I think for let's .

focus on narrow legal tic as you .

you we had this discussion, sex, and I said we should always do the top start of the week, even of its politics.

And now and for mine, inside about my locking group, I saw that you want some pod.

Who was, I absolutely design this pot around .

maggard affect the group, said ma group.

Okay, it's possible for two people to have the same idea sex. We both grew up on the locker group. That's why we're both in tanker's .

asas moderator intervention cut IT out. No one is individually responsible for this podcast.

IT was inferred. Yeah, tim ferus, here's what happened. So I was on youtube and i'm not going to watch them to our, like pok J K L, of course, for some reason, for some reason .

to five .

minutes. Ecb, ten minutes. Video, the .

the.

so I like .

so not this in the partnership agreement. He said.

here's the the party line, and jack will .

not stick with the history.

Yes, and I change.

No, the origin story that you signed up to, are you saying you change? The origin .

story remains the same, you .

call. How he created the whole thing, the concept is is based ic locally group.

which the concept default. How I moderate .

the program by.

of course I did no, of course I did not design my moderation.

Who was the first one? Who said we should record us having conversation of the poker table? No, that idea came from him, right?

That's why it's call the all in one. No, I came up with the and number one, number two, which is I get a tap pod because he came to anyway, who cares? The pods here .

is successful. You keep going on podcast telling everyone that you're the master mind of the old .

in people are saying, jack.

other .

podcasts. Ers, are you other pocatello? In all of my ability to moderate you three more contents.

you did not have the idea for the force based onic cloon group that happened. That happened spontaneously as a result of the fact that no freeburg was, I think, the first guest, I was the second guest, then we did the forever .

together OK. That was just okay.

fine. The way that, the way I moderate this is of note to the world's greatest power casters. They want to know, jack out, how do you take three misanthropic male contents and make them actually partial to the world? And I say, no, because I am the world's grade is moderator and someone .

like to farewell to use me excuse me, what makes me a misthress c malcontent?

Exactly just your behavior in world view. Is that .

what is my hair or and what is my world view?

You're absolutely for humanity. You ever. everybody. No amazing. I'm going to joke. It's called a joke.

It's all the joe said him off, jack, you really, you should apologize.

It's called a joke. I think you guys are wonderful.

I think you guys are wonder. I maybe misanthropic.

but .

milk tent.

i'm not. No last would .

describe the freedoms. G was happy.

No, I would say no. I think he's happy. He's anxious, but he's happy. Yeah, he's animals, but happy.

Did you see the roast? That was not a happy man was.

tell you, up was fly.

That was a part of that that was venting. He was, that was rage. I was right now.

I I think .

when fever tries to be funny, IT comes out kind of mean.

yeah.

maybe the first is .

the human rage.

the only person that sets me, often making me unhappy as U. J.

A therapy. Or we can keep recording this podcast every week, which is cheaper. This is cheaper for us. They just we grow the pod.

You know, I for one am thankful to whoever gave you whatever sickness you have that causes you. Do not be able to talk this week OK.

You're talking a lot .

for a guy who can talk about while we're talking .

about all kinds of random stuff. The number two things that I see in the what's happening tab on twitter right now is how an descente st is getting blasted for banning A P african american studies because he thinks IT falls under the stop woke act that this the headlines it's going absolutely nuclear on twitter right now. Here some of the coats, shocking rn. Descendest has banned all caps. The teaching of A P african american studies in ford, a florida has gone from don't say k don't say black next tweet, claiming that violates to stop work act and has no educational value for, or the government on decentish has banned A P african american studies from schools.

Prediction right now, this will all down to his advantage. The same people who said that he was death scientists for basically not in student covered lockdowns, he was proven correct. Then they said that this bill that prohibited the teaching of gender fluidity to five year olds, they claim, try to claim that was, I don't say gay bill.

Seven percent of florida supports that that were down to his advantage. I don't know the story behind this particular course, but if the question is whether crt is going to funded by the state and he's preventing that again, I think i'll be a seventy percent popular issue. So this is way and see how this plays out.

right? Of I just want to claim that my spread trade, maybe it's tough to be the leader in the republic lan nomination process in january of twenty twenty two. It's .

starting and either. But I say the bigger threat to the scientists is a new poll where trump came out on top. So trump still is biggest threat yeah so unfortunately, Jacob may be right that the republicans may do something stupid here and nominate a candidate whose I think less selectable than to see. I actually .

don't take any join IT.

I actually, I think nicky hal, he's gonna come out .

and nowhere in this thing. It's possible I really would like to see some non political, non career politicians run for office. The bloomberg, you know, sort of category IT feels like these career politicians are just really, really bad. And executing is come back.

You know who likes snicker, hailey? Democrats, democrats.

you guys is safe.

Establishment .

republican who basically is not going to put up uh, any fierce resistance to what the davos proud wants to do.

I don't think that's true. I think he was tty.

I don't think he cares .

about davos people to save her life. I think that he is a moderate, reasonable person who had to govern in a southern state and got everybody on board. That's that's pretty crazy.

She's a real life person who negotiated a twenty week support for abortion in twenty fifteen. So this is a person that knows how to get stuff done. South CarOlina a happens to be the state that's actually at the leading edge of climate transition, he said. More jobs and more money come in into a southern red state of people and companies willing to build for climate change than any other state in the I think that she's like Normal and saying and .

not an idiot, would you vote for absolutely over by absolutely absolute interesting hundred percent?

Yeah look, if you're really willing to vote for that's interesting.

absolutely. I you know she's Young. Her had a small business SHE was a small business person. It's tough to be a winner at all of those levels. And SHE managed to do IT. I mean, how do you, as a Brown woman, get elected to government, have aliena and do a lot of really good stuff? That's kind .

of stuff.

So I don't know. I think he deserves a close look and he is the only one that didn't count out the trump SHE was able to play the game manipulation, get him to be on side, and then still told him him to go pounds in.

That's pretty cool. Well, a lot, a lot of governors managed to do that.

saying he got SHE went to the united nations. SHE did what he needed to do. There was an important role at that time, actually.

nicky hail expressed, I said, SHE won't run if trump runs. So she's out out to trump. Two.

SHE wanted to be as VP, right, like he was trying to shank pants rute, that was her plan.

Maybe it's a smart strategy. He said he was not running into trump, the main alternative to trumper parking parties to scientists. Then I said no three in the republic ican party after trumpton santis .

len Young in right now based on what metrics .

s based on interest in the party and and i've talked to people and that I think the polling will eventually reflect this. He's very talented. You talk about what appealing to independence? He was able to win a blue state. Remember, Virginia went for a biden by ten points, and Young man was able to win that state, if you ever listening. And kim campaign, he is a very downside campaigner.

I think Young is very, very talented. Don't get me wrong. And I think that he would be an extremely credible candidate for president. Here's the thing that yang can will get destroyed on is he's literally not been in the job for, but for a few in eighteen months, so he hasn't done anything.

And I think that if he does boil down now, IT may not matter, right? Because, look, obama was a senator for two years or whatever, right? So IT may not matter. But to the extent that republicans demand some bonus fies, I think that you'll see trump and decentish attack Young, more ioua ly in a presidential primary than they attack healing on that dimension of you have no experience and it'll be hard .

from to back IT up this .

al point and the other .

side that al al point.

Virginia has the swingy one term term left on governor. So you know, he's got no choice but to make a play in twenty four because these can be turned out anyway. OK. J.

K, L, as a lifting independent who is only ever voted democrat, which of these .

republican republic .

has to .

be clear here of .

the times? twelve?

No, no. I vote three .

times to vote .

republican. I would like .

somebody whose Younger and actually been quite influenced by your framing of a person who can control the budget and reduce spending because I do think it's kind of the most existential risk we have right now. So I might be moving to more of a single issue, a vote for this presidential election.

I love that is you.

I love that about you, which I just think like we have to have somebody Younger who is not going to bankrupt the company. And the more these candidates talk about social issues and not economic ones, I think it's a tell that they're not the right person for the job. That's where i'm personally at, is like this country has a serious financial existence, al crisis on its hands. And we have to get off social issues and we have to get .

on to financial point. So I assume you support the republicans in the swimming budget show down.

I actually do. Yes, I do think we should have the line on spending.

So you support the republicans voting no on raising the debt ceiling?

Yeah, I actually do. I think we should start pumping the brakes on spending. And I do think the tea party, and that that doesn't mean I like those candidates, are kind of wax jobs, actually.

But you think George santos is a wax.

Listen, it's a wacky ack. The republican party has turned IT to some crazy Howard turn. Wacker ack sax is appalled by IT. He just can.

Some elements of both parties looks like.

would you ever invite to? And s to your house? Who would you invite? OK actually real.

Who would you be? Willing dinner, not a fund raising dinner, but just invite to the house. You can pick between two people, Alexander z, or George campus, who can.

I'd rather probably meet and talk to A O, C, of course, because they would be interesting. Don't want a fundraiser or no.

but no, not really.

Who in the front front door .

to what would .

you do to George? Would you not even return the email if he said.

David, i'm in town, I wouldn't him for dinner. Let you know it's so great, zy.

I mean, IT so nice.

Let's hold on hold on how we are going to get started. Um as your moderator, i'm going to try and keep us on track. Good luck. Um yeah no, look, it's a it's an energetic day. I appreciate, I appreciate my cow host .

and the recognition for supporting the republicans in this budget showdown. I mean, i'm like blown away by this.

I think it's great. I think it's great. As you guys know, just the estate is my number one concern on earth today. yes. And I I think that the importance of this topic really needs to kind of rise above politics of all .

the things you said freeburg in the last like six months on this program is the one thing that stuck with me. And it's one thing that is like actually now I realize is the most important thing for this country is fiscal responsibility, austerity measures and looking at how we're spending money and looking at immigration and looking at economic pho city and employment and competing on the word stage with a solid baLance sheet is the baLance sheet is how you compete. The baLance sheet is how you compete.

I think IT rises above social issues and IT rises above climate change. You cannot address climate change or social issues or infrastructure or unemployment unless we have the ability to Operate as a country over the long term and have the ability to have the the continuing credit of the united states dollar. And that's why I think it's so important.

Free work i'm dealing this with, with startups I have right now and I tell them the baLance sheet is how you compete. If your baLance sheet is foot upside down and you're going to be at a business in nine months, you're are not competing with these two other companies in your sector. You have to have a strong baLance sheet, take the austerity measures, make the cuts and then compete with a strong baLance sheet.

It's just so obvious ous this country's baLanced is getting flipped upside down. And we are gonna so many yeah very complex. Second and third order effects with the interest payments.

If you value austerity, if you value austerity, if you go look back in history and you actually ask of the prime ministers or presidents of various countries, particularly for all countries that have actually had an impact in implementing austerity, you know what? The unifying thing that I can say is women do a much Better job than met. okay? You want to study. You are Better off with with Margaret faster than you are and then with a dude, A K nicki heli .

and stage.

Look, it's a, it's a very hard position to be in a politician because you have to position your objective as one of taking things away and the primary way to get elected in a democracy, just like in junior high, when you run for president of the junior hy class, is i'm going to make the vending machines free, you get elected. And when you run in politics, you always promise your constituents what they're gonna get that they don't have today.

And that's the model for getting elected, whatever the issue is of the day, whatever the issue desired a decade, whatever gates all about what i'm going to give you that you don't have today. And so to flip that conversation around, we all have to sacrifice together for the long term ability of our economic prosperity we need to do. We need to give up the following things.

That is a very hard platform to running on. When someone on the other side, the podium, on the other side of the stage is saying, i'm going to give you these ten things and it's very hard to get like IT. And that's why democracies ultimately eat themselves.

And I forgot who said IT. But ultimately, all democracies and up, realizing they can vote themselves, all the money. And then you have the space cycle.

Publicans did the most brilliant thing ever. Recently, they moved from stop the steal to stop the spend. This is a genius thing, may stumble into.

Nobody wants to hear them talking about the electron being stolen. That's complete nonsense. But stop to spend. We all understand that everybody is seeing IT in their own personal baLances, are seeing in their companies. They are seeing IT in their families.

They are seeing IT with their mortgage ge payment, they're looking out there, you know, uh, college tuition bills, they're looking at there, car payments going from four hundreds to seven hundred dollars, and they're seeing what variable interest does. We have variable interest dead. This stuff is gonna sky rocket. Whether it's e loans, payments for twitter or your payments for your mortgage or our country's payments for our debt, we have to stop to spend.

You don't effective interest rates.

You guys continue the conversation and talk a little bit about this world economic forum gathering that that took place in double, and you guys wanted to talk about the this week.

Honestly, I am always .

trying to .

get the best out of u sex.

The budget conversation is an important one as IT relates also to the global economy and growth. So dos took place uh, over the past week just so everyone knows. And I remember you know working at google two thousand four, I remember like how exciting IT was for the executives to kind of started transition into the doo stage. IT became this moment where you're kind of finally, on the world stage is an exciting moment for c, for world leaders, for global economists to get together, talk about the state of the global economy, where the world is headed.

What we can and should be doing about IT and davos is also this, this place of pride and prestige for being invited in being a part of the party, the global oec party, as some people in our and that's what I think is the important conversation is that the world economic forum gathering in davos has recently been cast as the gathering of the global elites, those who are trying to take control and run the world, uh, as they see fit and sex. I'd love your point of view on how that transition has happened because one of the important ways that the davos gathering has been cast in the world economic forum has been cast is in the negative light of being globalist, and global ism has had a really important role in driving global economic growth and prosperity. And IT has had these adverse effects in the U.

S. As we've seen with wealth inequality, loss of jobs, offshoring, budding of industries and so on, I think that there's a really important way that davos has been politicized. But the risk of that is significant because if we do lean into this global list notion and say it's all about elites trying to take control of our world and we all become isolationist, that countries around the world can suffer deeply from the economic consequences of that shift. So maybe that you can kick this off, and especially in light of our conversation today about the need for economic growth and the reduction of global debt to support, you know, a more prosperous world in the future, this idea that right now we're talking about dos in the world economic forum as a gathering of global elite. And maybe sax, you can kind of give us the history and the point of you and how that musician has come about.

Well, it's a meeting of of global business and government leaders. So they are the elite. I mean, you at them all together and they do control, suspend proportion of the world economy and most of the new ones with the biggest economies.

So there's no question they asked of the most important people in the world, the bunch of the articles coming on. A dov s reported the suber mood and tone of the conference. The level of anxiety and worry was very high.

And I think that for a brief moment, IT looked like these people were staring in the mirror and realizing that their management of the global economy of the last couple of decades has been a bit of a disaster. I mean, you do have lunas deficit debt piling up in the us. And across the world, to me, like three fifty percent dea GDP globally.

So we've talked about that you've got this war in ukraine, that I and many people around the world thing was easily avoidable with a diplomatic failure. You're coming off of two years of badly botched, covered mismanagement, where the government of the world pursue a horrible policy, uncover, estimate everything worse. You've got decades of energy policy promoted by the world economic form, where they want to get people off fossil fuels and natural gas and get him on to less dense, less reliable energy, including promoting things like organic farming.

And three lanka, which we talked on the show, causes our common etic collapse. You've got the world economic form and promoting ideas like you're gona own nothing in the year twenty thirty, and you're going to be eating insects because no one should be eating me. So you've got these like wacky, extreme, you know environmentalists ideas and anti capital, anti property ideas coming out of dov s.

So I think the whole things been a bit of a disaster. And for a brief moment that looked like these people again, we're self reflecting on their role in creating these disasters. But of course, the tone quickly shifted to blaming disinformation on social media as the room caused all these problems, as opposed to their decades of decision making running, you know, the leading nations of the world and the leading companies in the world. And I think that the blame is properly put, not on social media, but on these leaders for making you bad decisions.

Do you believe in the benefits of global trade, where countries trade with one another and shift the sourcing of supply and labor to the cheaper source so that the buyer can benefit from having things in a lower Price and ultimately the global economy grows as kind of being beneficial to the U. S. Over the last thirty years or net negative because we talked you know about the the obvious consequences of global trade, where we've had industries guard in the united states and now we're trying to ensure them again and build dundon cy and so on. But that's becoming very expensive and ultimately leads to the inflation of goods and services. And so as you look at kind of the yeah the positive agenda of the world economic forum over the last thirty years is being about improving global trade and global relations to enable global trade, are you an anti global list? And you know, do you start to see yourself falling more in that camp as you see in here more of what comes out of dodos and from these organza like them?

Well, look at all. Economic prosperity comes from trade. If we didn't have, then we are all be subsistence farmers and hundreds and gatherer.

So we basically specializing something and then created over a bunch to that and trade for the rest of our necessities. The issue is that trade newly crazes prosperity IT creates dependencies because you're dependent on the people you're trading with. And also IT has distributional effects in terms of geopolitical consequences.

So trade with china has created some prosperity but is also hollowed out. The american manufacturing sector, while also making china very rich, which is basically turn china into a major geopolitical competitors states. So i'm not like a free trade fanatic.

I mean, I understand the ways that trade creates wealth, but I think you can also create these downsides that have managed. And the fact the matter is that this unfeared free trade ology contained the seeds of his own destruction, because all the revisions, ous powers who are seeking to revise the U. S.

Like global order, they were basically enriched and built up by the very free trade ideology that new liberals were promoting. So this new liberal world, world order has kind of created the seats of his own destruction. I think that I would have been much smarter for us two decades ago to be much more restrained in the china trade and to not throw open our markets to chinese Price, which they gave them M.

F. status. This is back in the early two thousands, and IT was a bipartisan project, a by parsing decision. But the result of that has been the rapid rise of china at the expense of our manufacturing sectors and to .

the benefit of our consumer class. right? I mean, we do have six hundred dollars phones because of IT, and we do have T, T, V. And there has been a consumer market that demanded these low Price goods to me.

right? So yeah, but so everyone gets cheap goods a target. But in exchange for that, we now have a real peer competition. The united states, which is capable of disrupting the see our privacy in the asia, was creating a much for chAllenging world. So look, I I can understand the reasons why people bought into these two decades ago. But I think that if we had to to do all over again, I think most people would recognize that we should not given china permanent offence status, and we should have been more temperate in our willingness to throw up in our markets to these countries.

Do you think that the world economic forum has kind of transition into this kind of new liberal organization now that's promoting these new liberal beliefs that aren't really tied to the original construction .

of global enable and .

supporting global trade and supporting the global economy and creating more prosperity and security around the world?

I think IT appeals to the insecure over achiever ally. Yeah, I know nobody building anything really gives a shit about devils. Nobody is thinking what's going on.

Nobody knows when that happens.

All right? So who cares about IT people who like status and went to fancy schools and wants to feel like they're in the club? And that's how they've made IT is going to this place, which underneath is a membership organization where people pay based on the number of people that get to go.

So is IT really that important? substantively? no. But over achieving surplus elites in the west really valued the signal that IT represents the other over achieving surplus etes in the west.

So that's what davos, that's what the island and company conference has become. A lot of these things started off much pure than what they are today, but these are all membership driven revenue generating efforts. In thirty or forty years, the all in summit will probably become that too.

It's just the nature of things. So I wouldn't spend so much time focused on group of people getting together. The funniest thing about davos that I saw was zero hedge, which said that the amount of prostitution is at record levels in davos.

And so IT just kind of boils down to what IT is, which is like any other conference. IT just happens to be with more security guards than less security guards. And the same stupid stuff happens that dev s, that happens in vegas at name your conference.

C, E, S, is just a different kind of attending. So I think the bigger thing is that. We are learning that the world tends to have these policy perspectives that swing in a.

And the problem with the panjal m is that IT IT is at extremes, and sex is right. We went from an extreme where we were very close off and we were essentially subsistence farmers. All of us were.

And then the pendulum has essentially peach, probably in the mid tins of this decade or of the century, where we realized too much. Globalization actually holds out local economies. So we need to find the equilibrium point, and that inherently has more inflation, that inherently has higher Prices, and that inherently has slower progress, but more consistent progress that benefits more people.

And this is what is so ideologically disruptive to, again, surplus the needs because they need the six hundred dollar iphone. The idea that they can upgrade every year, drive them into such A D C, that they need to export all the jobs, whereas thousand dollar iphone or a fifteen hundred dollar iphone may just mean that your upgrade cycle is two years. And just ask yourself, how many times have you upgraded as soon as the phone came out to realize, man, this phone is actually worse than the previous version, and I probably could have just waited.

And there's a lot of work that actually goes into building these things, actually make them Better. So all you're doing is you're giving up optionality. You're allowing your brothers and sisters struggle to basically feed the profit motives of one company that in hind sight doesn't need to happen.

So there's an equal library. And I think that these next few decades will be about finding IT. We have decided its categorical at that level of globalization that we have had.

This unitary, singular, monocultural way of thinking about things is over. And David, right, is because that system has created too many threats to that. He germany, that brought us there.

You that's good thing. I think in general will be IT. It'll be more prosperity for more people, but it'll be slower and IT will create points of friction that are represented inflation in higher Prices, right?

That's right. So as J, K, L, as you know, to move point out, like if you're upgrading every two years instead of one year, your economy doesn't grow as fast, you have less spending. If the Price of things go up, you have inflation. The net cost of d globalization is higher Prices and lower economic growth. That's just fundamental kind of macro economics.

That's not true. That's not true because the deglobalization in an individual economy will actually create GDP because you have to rebuild the things that's used to import.

That's right. yeah. And over a period of time, theoretically you could catch up and accelerate, but jack out like when you weigh this conversation about govs.

And globalization and U. S. Security against the one we just had, which is why I wanted to talk about this.

We're running into a debt crisis. We have limited spending capacity. We have a significant amount of investment needed.

If we are going to cut global trade ties that we have depended on historically and start to build density, can we afford this as a country? Can the west ford this, given the economic slowdowns and inflation right now? And you know, how do we baLance kind of these conversations against our domestic chAllenges?

Economic davos has a pretty serious P. R problem. They have dub b themselves like essentially a self appointed alumina I for the rest of us and that they're gona set some global agenda. I think this year is agenda was like finding the future or defining the future. Nobody asked these people to be in charge.

And if you look at what's happened in the world, the chaos of covet, and you look at what's happened in terms of energy policy in europe, and then the subsection sion with social issues, and being told you, these farmers, these truckers are bad people, your not work, whatever is. I think the public looks at davos as the manifestation of these global elites who are lording over them. Some master plan, whether it's real or not, that they're not part of and that doesn't take them in to consideration and that takes them into consideration only their profits.

And when you actually peel IT back, as champ correctly pointed out that this is a huge griff, they they recruit me to be part of their world leaders fifteen years ago after that. So did you make a second company? And my met claws, the guy who runs IT at some new york four seasons event.

And then I got the bill. And to be a world leader was forty fucking thousand dollars. And I was like a global future leader. I don't know what that means, but i'm not giving you forty thousand .

dollars to pay. You had to pay to be a global .

future leader, and you didn't have to pay for a six thousand dollar ticket at the time. This was forty large. And I just thought you, this is not for me. And what a joke. I think people would much rather see some resilience ency in the supply chain, and they would rather see the origins of covin and why we spent two years in a lockdown and was that a cover up of the united states funding gain of research.

you know, being done in will haunt like.

and why are we shutting down nuclear power plants and what exactly the energy policy germany people are looking at incompetent elites going to davos, having a big party and then setting an agenor for them that they don't understand or want. And I think this is where, you know, the the the contempt for davos is peaking this year.

And IT should if you're being invited to davos and other people are not being invited and they don't have a seat, the table and a voice at the table, you can tell that all the journalists there are on an access journalism pass. What does that mean? Access journalism? They get to come there and they get to hang out with a leds if and only if their coverage fits a certain profile.

And if you find me the top ten most critical anti globalization journalists in the world, I can guarantee you that they don't have credentials. I think it's like a bankrupt organization that should just be shut down, and the people who are going there are involved. No, I think it's .

culturally bk gumuch interest.

No, I do. I think not what the world wants right now. The world wants transparency, and the world wants ownership of all the score ups, you know, from coffee yeah, two energy policy. We want ownership of those issues, not a bunch of a lead drinking champagne.

I'd rather spend a week with entrepreneurs, or Frankly, you spend a week with my kids or Frank, yes, then a week like poker with my friend. Course, let's do IT. They're like mpt things that are above the less.

So it's kind like let them get together. I think it's to get together. They should do IT. I just think that if you're not there, I would not weigh these things so heavily because IT speaks more to your own insecurity. Then IT does that their actual influence on things.

Yeah, the terminal lead is an interesting one. You you companies need to C, O, to run. The company is not run by ten thousand employees.

And governments need a president to oversee the government. And I think the idea that some small number of people that are in charge getting together is now being cast as an elite gathering. And elitism in itself is the failure is I I don't think .

it's leak gathering. I think it's very important to get this new one rights. It's a gathering of elites and that's very different than an elite ite gathering. And a leg gathering is when like Michael Jordan and lebron James and staff curry get together and work on their basketball and that's an elite gathering. A gathering of elites is what's happening in doubles.

but they are the presidents .

of their companies and the presence of their countries. So I would .

differences between the people who are merely attending were paying the forty thousand dollars, probably a bunch of .

hangers on. It's not .

towards or fifty.

by the way, hundred fifty thousand years anyone want to pay that is like totally insecure.

So what I got back from so you did.

okay. Well, congratulations. Looks good on you though. Look good on you.

Did you spend your own money .

or your money? I mean, one person I want to do to spend our money, like probably not right exactly .

the hours on you're spring twenty fifty thousand dollars to feel important, but then there's the people who are invited who probably spend any money. You're basically speaking right. And you gotta a say that the the group of people who are speaking at davos, individually and collectively, are quite influential. They are the leaders of countries and and fortune five hundred companies. sure.

But you can agree that they literally don't say anything that's noteworthy because you're not like to .

they're not saying anything that's that different of what they would say the previous week or the following week. So but it's A M, it's A A forum. It's a yeah it's to get together.

Look in terms of the critique of IT fever. U. S. How far back to this go if this is not like a new thing? The the term davos man was coined back in two thousand four by harvard professor named sam hinton, wrote a book called class civilizations is the press of international relations at harvard.

And he coined the term davos man to refer to a globalist who, quote, had little need for national loyalty, who viewed national boundaries as obstacles that are, thankfully, the vanishing. That's all hunting to define dao man. And there's been a reaction to these dove man has been growing for a couple of decades.

And I obviously the election of trump was a reaction to that bragi t was a huge reaction to that. And I think that the resistance to the imposition of their, again, there are globalist policies, which I guess you could to find this, believing in this like borderless world, economically and politically, I think that's been receding in favor of more national leaders who want to promote their own country's the interest. And I think that that trans gna continue.

What chance? Let's transition to the broader question that I think we got into A A couple episodes ago on how can we afford this transition if there is this mounting kind of trend against globalization, is mounting deglobalization movement and effort, particularly in the U. S.

And I get a sax pointed out, global debt to G D P is something like three hundred and three and fifty percent depending on how you can't. And we're running into a dead ceiling here in the U. S.

I guess the question is how do we afford to build the infrastructure redundancy and make the investments at home to replace global trade? Can we afford to do? And how's this gonna play out as we run into this you know ah that feeling.

but I don't think that's the right question. I think it's the inverse of that question. How can we afford not to with the amount of discontent and the amount of economic train that people feel if you want to really quite popular m you're gonna to create economic viBrant cat home.

When people are making money and they finds purpose, they're less agitated. They are not storming the capital, not electing fringe candidates, they're not doing domestic terrorism. They're just going to work in building a life, right? We know that.

So how can we afford not to? How can we afford not to, like, bring back jobs to the heart land of america? So the reality that I have, and I think a lot of people have, is that this dead GDP thing is a bit of an intellectual red hearing.

And the reason is people talk about this thing constantly in these absolute terms with no historical president. That relates well to our current moment. There is no magic number at which thing this experiment that called amErica fails.

So I think that you have to be a little bit more intellection honest and say that at best is a relative problem and it's relative to the countries that have already established dominance, of which there are eight or nine and then the emerging economies and then thinking about what critical things will they bring to the table in fifteen or twenty years. And in that context, I think that people will him and how but ultimately will capitally. They will raise the debt ceiling and they will continue to fund this transition away from global ism. And I think that's the argument that look at the republicans over the line because it's gonna bring a lot of spending and stimulus and jobs to, Frankly, a lot of red states that would otherwise kind of continue to weather and die on the vine.

I think here's my biggest concern were either trying to walk a tight rope or there's no tight rope to walk. And if we make these investments and they're not economically viable investments, it's a path to ruin. And what I mean by that is if we're building factories, manufacturing facilities, infrastructure that relies on yesteryear's technology and systems of production and grow and and kind of economic systems, and there are alternatives that are competing on a global stage that are Better, more productive, more advanced than we lose, and we ve made an investment in a negative r.

Can I see question? Yes, see when when you say that though, you are making a very basic assumption, which I think you can question, which is you are underpaying that on fundamental economics that can change if we choose to. For example, let's take like natural resources.

Okay, every time you do a plan, the industry, and I define the industry, is every four profit company and wall street and the debt markets. They refuse to underwrite this thing at a higher cost of capital. They use a wac of six or seven or eight, and they will fight to the nail to use the smallest discount rate possible because IT allows them to capture more of the profit dollars.

But if you actually had a realistic wac of like ten percent on on a massive infrastructure project, guess what? You're actually pretty equivalent to a government. And in fact, in many cases, the government becomes cheaper.

So I think the thing that is worth debating, and i'd like your reaction to this, it's not that what you're saying, it's we refuse to change the guard rails on our profit making ability. And if you extended the window, if you change the discount rate, if you said PS can be different, you would have a very different economic justification for you just said IT completely changes. A hundred basis point change is everything you're saying by tens of years.

One way to describe that yeah is, uh, another way to reframe what you just said is that the useful lifespan of an investment isn't forty years or fifty years, but IT may be twelve years. And if you if you re cast the investment decision as this has to be a twelve year return instead of allowing IT to be model as a forty year return, then you start to really filter out a lot of the nonsense and you can actually see real payback.

IT doesn't make sense to spend a hundred billion dollars on a train to take people from L A. To friends now or whatever craziness. See, the california high speed rail program has turned into IT was originally like a billion dollars to go from a from cisco.

There is economic justification to get payback on one hundred billion dollars or whatever it's balloon into. The whole system should be shut down. So I guess there's a from a policy perspective and accountability framing that's missing, but also bringing in the time horizon on which we need to get paid back for these things.

My point was that in china, and i've i've made this point many times, but I just think it's a really important one we'll play out over the next couple of years. They're building four hundred and fifty nuclear power plants. They're na get the cost of industrial power below five cents or four cents a kilo an hour, and they're electrifying all their factories as they do. That is no longer a unit of human labor that needed to produce goods, is a unit of electricity. And if the driving down the cost of electricity and all products can be made using electricity, you have a huge economic .

of image is not the cure, or that you think that is, even if you have free energy, you have to think about the inputs and .

the thing that china. But no, sorry, I am not my energy. I'm saying a general .

framing like I and I my .

point being like the investment we should be making or where is the puck headed not? Where has the pock there?

no. So I just I just want to to comment on where the puck is setting. Even if energy is zero in china, you have to think about inputs, meaning factories make things with inputs. And if you look, for example, in natural resources, the inputs, by and large, don't exist in china.

And so all i'm saying is that all of these inputs, whether, again, you can take natural resources that proferred massively in the united states, IT turns out that india is ugly, ugly, utterly poorly addressed in a geographical survey perspective. And we are finding that india's raw resources are off the charts. Okay, there are certain places in africa, tons of stuff in indonesia and australia, all of those things may not have to go to china because there are subsidies or there are equivalent cheap er decisions that government can make so that they choose not descended.

And all of a sudden, all of that spending doesn't matter as much because the australian government makes a trade off that says, you know what, i'd rather have these jobs here, and i'm going to have a longer payback cycle for these jobs to be here, then instead of ship IT to china. And they tell, they tell the australian citizens, i'm sorry, guys, but you're going up to replace your car every seven years as opposed to every five. I hope you're okay with that, but that'll mean full employment and it'll prevent french candidates and populism. And let's go forward.

Where do you invest?

I am in. I am investing a lot of money. In those places that controlled the natural resources that are poorly understood, meaning there are places like india where our geological survey capacity is relatively nave and IT. Turns out that in critical parts of the energy supply chain or other places, they can play a huge drop. And the indian government's cost of capital has an element, their sophisticated enough to add of an element, to the formula that accounts for full employment.

If I build IT in this stay and if I try to get this many jobs created, the full circle feedback of that allows me to actually transfer Price IT into the indian market at this Price, which is cheaper than anything that china can do, even a zero energy. That's the kind of sophisticated decision making that is emerging because of this deglobalization trend. And it's happening everywhere.

So the indians are doing IT, the german are doing IT and then the U. S. Is doing IT. And then on top of that, what the what they're doing in terms of game theory, which I think is even more sophisticated, is they're not letting china be alone.

They're actually now slowing china down because china turns out actually needs inputs from these western economies, and they are like, we're just not going to give them to any more. So do the best you can, for example, in sending doctors, the dutch, the germans, the americans. We've now essentially embargoed all of our most sophisticated equipment from every getting in there that will increase, even with zero energy, the cost of what comes out there.

And that will baLance the playing field so that the germans, the dutch, the americans can bring other partners in at a different cost of capital to make IT economically neutral. And that parody. And the reason they'll do IT is to create jobs for americans or the dutch or for the germans.

OK, I think the most yeah yeah. I think the most important thing here isn't like energy. I don't think it's infrastructure. I don't think it's natural resources, at least for america. It's entrepreneurs and and that's what it's always been for this country and its immigration is the civil, volatile and inspiration in the freedom that this country has for entrepreneurs and founders to pursue a vision to start a company.

That's why we've won so big hyste icy is the the combination of immigration and the inspiration that these entrepreneurs do on a global basis to get more entrepreneurs to come to this country, to coto stanford, to start companies. And that's why china is now losing. They ripped this incredible formula we had of letting jack ma do alibaba.

And then they decided to, for whatever you insecure or stupid reason or pragmatic reason, to consolidate power. And that's what will push the world forward and and make our country thrive. We have to fix immigration.

We have to keep letting entrepreneur s to find the future, because the government can do so much, they can underwrite a couple of chip factories here, there. Sure, we can put money into nuclear, or fusion, or fusion, whatever the next technology is. But you need a singular person who wants to make their life's mission, who wants to have their sense of pride and innovation push the were afford. And those people are rare. And we are in a competition globally that we are not focused on, that we need to every focused on to recruit the greatest minds in the world who want to change the world, to do IT on american soil.

I do not disagree with you. J. L, I think you know to my earlier comment about how do we walk the tight rope of the dead, burden the deglobalization and popular and movements, and the and the the chAllenge is an opportunities ahead and have to come through innovation. I think that's how you you have to invent a new tight rope.

basically. I think the chAllenge though is freeburg that IT takes a recognition that there are singular individuals in the world, one in a million, one in ten million, one in one hundred thousand, whatever is who can just drive an entire economy ford, whether is gates with microsoft, Steve jobs with apple, there are singular individuals who come to this country.

Ban, ban, broken with, uh, the tunnel and company.

Nice fall. Nobody knows what you're talking about.

except for me.

There are people who will push these things forward, take risk. And we have to a recognize that it's a small number of individuals backed by a large amount of capital that create massive jobs and great prosperity. It's an uncomfortable conversation for people to realize that I might just be a couple of dozen people a year immigrating to this country that changed the date of this country.

And why do you need to allow three million migrants to stream across the on border every year?

Because you don't know which one is going to be, that's what .

really that's your immigration policy is open border.

So that one in the same ruit, that's the .

are migration. O, K.

I can explain that. A great question. Sex, there are two things to look at here. Take me finance. No, I just going to .

ask you to just filed you are you saying that the P H D student that arts google is streaming across the border or actually apply?

No, absolutely about you.

Part of many part parts for you.

There's immigration and then there's recruitment. And if we frame this process with those two different words, there are people who, yes, immigrating, streaming across the board. Have you want a frame sacks? I don't look at IT in a political way.

And then there's recruiting the most the talent in the world. We can do both of these things. One of them, you know, helps farmers have people to work the fields, to have people take entry level jobs, to work in the service industry. We should bring in two or three million of those people per year. We should make IT legal, and we should celebrate IT because we have so many of those positions open that american's unity.

We should then also, in parallel and without confusing the issue for political reasons, recruit people to come to our universities and when they graduate, have their citizenships stable to that diploma, and not let them leave the company country and let them start companies here. Instead, what we do is we make them fight to stay here. We should be recruiting the smartest, most talented people. That will be hundreds of thousands .

of people per year, while hundreds .

of thousands, then we millions on moderate.

Yeah, sex go .

over. And my dad came over in nineteen seventy seven, one else five years old, of course, e had an md, he a doctor. He actually had like skills and wasn't immediate. Become and that government dependent. So I think that IT makes sense to allow immigrants who can actually add something to our economy and bring skills and all the rest of IT. But the problem we have is that if you want to take that reasonable position, you're told that you basic have to accept a situation of defect of open borders, which is radicals. don't.

These are two several things.

and I just say you are, is the number one party .

that conflicts these two issues? You know, there are two separate.

okay? Both parties are .

conflicting. Him here at the all in pockets, can we agree?

One group of .

people could recruit people for p programs. One group of people allow people cross the .

border taking bs. The man, what was the definition of davos man? IT was somebody who was pushing this ideology of free trade and open borders to such an extent that IT creates a nationalist backlash or populist backlash.

That's exactly what's happened at our southern border is you have the people who believe in immigration push that ideology to such an extent. They won't create a rational, sensible a southern border and processor southern border. It's chaos down there. So look, favor bringing in the dream team in favor bring in the dream team.

The response of open borders is the creation of the nationalist movement, right? The nationalist movement only exists in the face of open borders. I think that that's the point, right? Like the extreme bear is the extreme.

I think immigration there should be based on points, just like dovo man.

If the dos men don't start start taking into account these national considerations around the defense of their borders and these issues around trade, hollowing out middle class, then there's going to be an intense backlash. And I don't think those, at least of imaging the situation very well, even Better for them to pursue the more nuance policy are talking .

about why are we conflicting the issue? Then why do the democrats and the republicans sax make the such polarizing issue instead of stating that the way I did recent and the southern.

it's so easy to separate them. You know, you can flag them. You can invite an emotional response from your voting days. That's that's why all of these issues, that's why all of these get based out. They get based out to the point that then you can give someone to vote for you because you've now frame the other side as the extreme side.

How you earlier said before you got somebody very reasonable, you said that we to allow .

really haven't listened.

But i'm in quotes. You just said a minute ago, you said that we had to allow two to three million, two to three million completely destitute, properly illiterate migrants to stream across our border, because one in a million of them might be an elon must.

No, there could be. No, no. All done. I was here. You can not. Immigration typically includes, when you say that word, the corpus of people coming in for education and the people come across the southern border.

So if you were to say immigration, most people reason to save that's pull through those buckets. I separated amount here so we could have a reasonable discussion. Recruitment of higher education, talented people with low education migrant workers, they are two different buckets.

And you have to be able to say, these are two different buckets that that we should have a point base system if, and this is the conversation that doesn't happen among the politicians, but can happen here, look at canada. Look at australia. They have what's called the point based immigration system.

They give you points for everything that you bring to the country, if you bring money, if you speak the native language, if you have a degree, if you have a higher education degree, or you have skills that that country needs, our country needs to move to a point base system. If you're crumbing across the board and you don't speak the language, you don't have an education, you have zero points. If you have a masters, agree to with three points, and you can let in buckets of people based on compassion, based on the service offers and based on needing the next elon mus or the next David sacks, or about polypoetes A.

I think the argument, J, K, L, is that the compassion argument falls on deaf years in a time where people feel we cannot afford IT, and it's a luxury to embrace that lot of immigration right now. Just pick a number we can reasonably absorb. This is .

what look at the southern border in c chaos. Obviously, they want to get .

that control before they're .

going to adopt .

your point base.

Idea of, I don't know my posts because this is your points.

but in concept, I like that.

I like the idea of admitting immigrants based on skills. The country actually needs great and a simple recognition that's Better to bring in people who are immediate cure along and can add to our economy, as opposed to be that government recipients, dependents.

We're done. We're done. There are countries and only point. There are countries, the skin, and even countries specifically that have said we can accept up to this many folks who are uneducated, who don't speak the language, because we have this many teachers and this many slots in school. And so anything was filling. And sweden, they said we can accept fifty thousand per gear of this type of immigration based on compassion. That's the reasonable disgusting that .

has to happen here. But did did you say that we have to do these two things the same time, meaning that until we impose a in overhaul our entire immigration system to be based on skills and points, that we can enforce the southern border?

No, I think you can enforce the south and border and you do these things at the .

same time time because there's not .

can be a broad .

base constituency, this country .

for the type of immigration reform you're talking about until you get the southern border under control because people look at that on the news and seek .

chaos and be thoughtful. They be often, and they should just look at what canada, australia have done. Those countries have actually controlled this. And it's not a polar ized issue. There is a pragmatic issue.

Okay, guys, i'm going to move us forward to the the banning of tiktok. I want to canna change the the tone a little bit. This uh, story recently is that the tiktok has been banned for use on the campus wifi network.

Let's go add a number of universities, including UK, Austin, auburn, bois's state university of oklahoma. The college students can access the APP when they're on the cabs network. This is following nineteen states that recently ban tiktok and government devices. As everyone knows, tiktok is a product from bike dance, which is a chinese base company.

And there's been quite a lot of political and regulatory huffs and graphs about tense having this level of insight and access to users in the united states, the assumption being that much of the data that they are pulling out of the APP is available to the chinese communist party, which creates a security threat to the united states. That's one argument. I think there is also a significant tian to buy dams.

There is over eight billion dollars of capital invested in by dance, by firms that we know well like to qua capital, tiger global, koto, sakha a and other. They're trying to find a way to monetize their investment in what is truly the most viral, fastest growing, highest revenue growing, biggest start up in the world right now. Invite dance.

So there is a restructuring proposal apparently underway that's been discussing washington, D. C. Right now to try and restructure the organization and the ownership structure and the oversight of tiktok and bike games such that U.

S. Regulators and U. S. Companies can oversee the data, the use of the data, the algorithms underlying tiktok, and monitor them from within the united states.

Question for this group here on the microwave in group of twenty twenty three is does that do enough for you, Michael owen? Do you guys think that that's enough? First stop is, uh, chaos has been silence for that.

I think this is really bad news for by tense. Basically what's happening is that all the frustration that all these legislature legislators in politicians have had over facebook and google and other the sort of big tech companies is gonna a get focused on bite dance because you have this common enemy that you can point to as a boogyman of sorts.

And i'm not saying that it's right, but I think that what you're starting to see is, is much easier to pick a fight with a chinese company and win and get broadband support, then IT is to pick a fight against an american company with a bunch of american employees in american market cap in american know how an american IP that is impacted. So I don't think this is going to end well for tiktok. And I think the goal, if I were any of these people on the captain, would be the salad in second to somebody else and get up.

I think the next big shooter drop, he's going to be advertisers who come under a lot of pressure. So for example, think of all the advertisers that have left twitter. There is a point of efficiency where you can live with all of the mess that twitter has because comes with a lot less scrutiny, oversight and political pressure than advertising on tiktok.

And that, I think, is the next kind of like big wave here. So I think it's very, very bad. I I think the enterprise value of this company quite chAllenged, and these guys should try to selling IT up. Who are the buyers .

in that secondary market though? I mean, that's a lot of capital.

The thing is the capital les haven't been segregated. So what you own is equity and bite deads, right? But the problem is the look through others ship would will discount a lot of tiktok if they see a lot more of this stuff happening.

You guys have, remember, this is the first three or four weeks of twenty twenty three wait over here in september, october, november. We till the election year starts. It's not good.

So it's a discount on bike dance that probably takes bike dance down by seventy eight billion. So that's a thirty five, forty percent discount to their last mark. So you know, if somebody can sell in the high hundred billions of dollars, I think you should I think they should problem. They should .

consider there's it's worth, I know you got strong ii. This is the same as the five g issue. You cannot trust the chinese government to not still intellectual property or to put backdoor ors into the software.

IT is common business practice there. While I was banned, they basically stole the source code from cisco that was proven, and IT was proven that they were spying on people. Canada, the U.

K. The united states, vietnam. Everybody has banned using five g technology from china for a reason, because they will use IT to spy on you. This is a the nature of in authoritarian government. IT is far too powerful to have a um not only of the surveilLance capabilities that are built into owning tiktok in the hands of the chinese communist party, to have the ability to very in a very nuance fashion trends, certain videos that would steer the states in a certain direction politically towards stupidity is one, of course, right letting the minute .

I O they they are showing science videos to the kids in china and they're showing stupid nonsense to the kids in america, what do you think over military videos do our children versus .

their children? You can be a hundred percent that they're doing sip s on our children as we speak. They are trying to make us dumb, distracted while they get smart.

And change by choice of our gm is just more .

exactly worse .

that saying, if you give kids the choice between broccoli and joke bars.

course of the the supermarket, say going to go the job of .

the parents access number one and the number two differentiate the dependent pad sex.

Good things and is not bright for tiktok here because it's got a caught up in the geopolitical rivalry between china and the united states. And that's only onna keep getting more, more intense. The U.

S. In china aheads for a big security competition and bite dances caught in the middle. So I agree to about the future.

But you know, this claim is made that tiktok is spyware and you is listened to you. It's surveilling. You is coming track. You like, what is the evidence for that claim? I just want to understand that a little Better.

Like, has anyone ever proven that, like tiktok, a spirited? And if IT is, why does an apple stop IT? Could you explain that to me? Yeah.

I think apple has a complicated relationship with china. So claim that.

So jackie, your claim is let lum, I want to pen jack out down. The first secure your claim is that one hundred percent tiktok is spyware and an apple is letting that happen because they're alison.

With this ccp. I do not have the evidence of specific instances of them spying, but I do know that this is what the chinese government aspiration is, is to be able to have back doors to spy on all americans. That's why they are trying to get away away. It's because .

that .

happen well, you don't even need to know that because you can just open your eyes and look at and that and but you can just look at what tiktok has. The access to IT, has access to your location, has access to your camera. All and IT knows, you know, everybody in your social circle, because IT has your address book. So by having your address book, having your location and having access your photo role, they have you compromised .

by default the defauts settings when you installed tiktok. IT turns on local network, turns on microphone, turns on camera, turns on background up, refreshing, turns on sell data. So technology no worse than anybody else in that because a lot of other apps are very aggressively trying to harvest all that data as well.

Sax, like it's like alex is always listening to you, right? But you feel but you feel safer with alex a because it's a it's an american company or the perception of safety is there. So I don't think there's a huge thing to prove other than yeah, there's a setting that like you to turn on the light. It's a defauts and they do IT.

but they work cod. I just want to make sure you guys understand this. Storing the new york times by dance, the chinese parent company of tiktok, said on thursday that an internal investigation found that employees had inappropriate obtained the data of U.

S. Tiktok users, including that of two reporters over the summer. A few employees on a bite dense team responsible for monitoring employee conduct tried to find the source of suspecting leagues of internal conversation in business documents to journalists.

In doing so, the employees gain access to the I, P, addresses and other data of two reporters. In a small number of people connected with reporters by the tiktok accounts, they were trying to determine if those individuals were in the proximity of by dance employees, according to the company. So there's an example of them using the technology to try to track down leaks.

Hold on the second, that's exactly what any APP a company can do. The photos, the screen shots we got from twitter um that were shared in all those files, whatever that happened a few weeks ago, show that, that many twitter employees were able to log in and just view the direct messages between twitter users and that there is no necessarily logging or um access privileges required to have access to that information.

There are these holes in all of these social networking. And consumer uh, digital consumer product companies that allow individuals to go in and do things with consumer data. It's a future, sure. But he doesn't reference like some systematic control by a .

government agency. No, that is everybody tries to get these things turn default every APP try to get access your camera to your context to turn on the microphone. The problem isn't that those settings exist because apple created them, and apple created a privacy framework where you have to opt out of IT.

Okay, the issue is that that data in going to american company with american on the with american data centers in american service, it's going to somebody in china or it's the perception that's happening that I think is a death now. And this is also excluding all of the work that every single big tech company must be doing to point the finger away from them. And this is something they can all agree on.

If you got, if you got andy, Jesse and suck, and soon dar and site andella in a room, what do you think they could all agree on? Hey, guys, are we Better off pointing the fingers at each other? Or should we just pointed over there to a company based in china?

So do you think do you think that tiktok in ways being escaped out of here? Or do you think is a real security threat?

Both both? Yeah, that's yes to both. And you know what I think what we saw with the the twitter files, for me personally, the one met was most concerning was the fact that the FBI was being treated. They didn't have control of IT like the chinese government has control over by dance at a whole cell level.

But they were being given you pretty um close to they won't giving god priests, but they had more influence than they should have and they should have gotten penis, right? So even in a democracy, united states, you can see the FBI using techniques to get employees on their side to get information on specific users. Imagine if the FBI just had god mode for twitter or facebook, like what would happen.

And even in a democracy, we see that happen. We see abuse. The chinese government is a communist party. They have no problem sucking the data down of every single person and using IT however they want.

I think third, the problematic thing is that when you look at the capital structure of these chinese companies, post now g being ruler for life is the chinese government has typically a seat on all of these boards. They also typically have a golden vote.

And so when you think about the governance, the governance of these companies has tilted far away from a Normal table, table where is one shareholder, one vote to you are allowed to exist on this, capable of the benevent Lance of the government. And so I think that you have to factor that. And is, well, so, you know, is IT amplified probably.

But is there also non trivial risk that we would never give to any other company? absolutely. Like, you know, take the opposite example. How would we react if the government had a golden vote in a board seat on meta? Going into an election, I mean, one party would be crazy and the other party would stay month the worst.

That's good. Well, I mean, let's talk about let's be pragmatic. The news reports that came out this week indicate that they are talking about restructuring by dance.

So let me propose this to you guys. If tiktok U. S.

Were set up as tiktok us. Ink to don't see corp to based in the U. S.

And bite dance owns passive non voting shares and take us all the software, all the services, the algorithms are all run in the U. S. The data of service in u. And the chinese have an economic interest ultimately and what happens with that asset. But that asset .

is entirely .

managed.

Run down and then .

you trigger, you trigger cities. So you'd have to then make an exception.

That sounds like a part of the discussion that under way right now is how do we get past the regular actor hurdle. I don't know I how you turn off tiktok for one hundred million people that are using IT for two hours a day.

Guys that we're rejecting deals love fight in center at much, much smaller thrust because of you is because .

we're not even dealing. right. But like that's obviously eight billion dollars of capital is right .

the minute that if you at the chinese government around and do an end around on sophya to own thirty percent passively, then everybody who's had a deal rejected for a much smaller threshold, for a much more issue will sue. Except that they .

started with the asset versus buying into IT, right? That's the difference. And what they're doing is they're seeing the different here.

They're seeding control of the asset to U. S. Investors and overnight by the U. S. Government versus the reverse, which is trying to come in and buy an economic .

and that's not what this is. A judicatory doesn't a judicature? Was this originated judicael in this capable? Does this person exist? Should they exist at what pressured? What do they know? And are we .

giving something that we shouldn't?

And yeah, let me give if the pratic is you can just make up a bunch of stuff that lows up a bunch of other .

me differently. What if bike dance sold tiktok U. S.

To A U S. Own private equity concerns? A U. S. Run private equity that effectively bought tiktok U S. And Operated in here s that's .

exactly what should happen. But my point is those people are smart enough to not pay for Price. You'll say your fuck that asset is worth zero.

I'll will buy IT for ten billion dollars. Take IT or leave in and you know what you'll have to do, they'll have to take. So my point is the equity value is so impair in this thing.

But for ten billion, of course, i'm a buyer, but these guys are smart enough to drive a huge bark. How hard bargain. So if you're existing on the captain and you've marked at three twenty, I would be fucking selling IT.

What's something like this is going to happen to be interesting to watch?

And if any group of people got together and try to actually buy IT for what the film get value is worth via a spread chip is a horrible investor.

In this moment.

you should hold a gun to their head, and you should extract a massive pound of flesh that gives you a huge margin of safety.

makes you money. We know people who are shareholder ders. If they could have sold at three or one hundred twenty.

they would have sold ready. Are people that will buy this thing in the hundreds at in size, then sell .

everything you can. And I put IT into another company.

Now the problem is you have to show mark down, because marked at three, I got to take a .

sixty five percent. Yeah, if you, if you're underwater, you under water.

But for anybody who got into the sub one billion rat peer, so P, I move on.

The D, P, I, move on. Another bet you can place why try to be investment?

I want to move away from software meets letter to software meets human health and productivity. A couple of weeks ago, we're going to talk about this. Last week, he was announced that bio and tech was buying inside deep.

Instead, deep is a broad horizontal A I machine learning tools company as services businesses partner with big businesses to help them build out ml driven infrastructure to improve their products and their Operations and their businesses. One of their customers was bio entex, the company that designed and on the I, P for the original fizz code vaccine and one of the orient or originators of M R A base technology. Bio and tech doesn't just focus on M R N A technology.

They also focus on cell and gene therapies, the novel new kind of modalities that are emerging in in their appetites. And you know, IT was a really interesting acquisition. IT was a two hundred and fifty, I think, person came that they bought the company for about six hundred million dollars.

Specifically to improve how A I can be used to accelerate drug discovery. I'll just make a comment on this immense x. I'd love to kind of hear your point of view on these types of businesses. Broadly, the capabilities of machine learning, when applied to a particular vertical, are quite profound. I you know i've certainly been involved in the space in agriculture and increasingly doing more of this work and pharmacy, ticals and biotech.

And you when you can have large unique data sets that you can then model using these tools and these capabilities and be predictive about what the next product generation should be, IT can really change the value in the project of your business. One of the big trends in farmer right now is to move from invita testing, meaning you running biochemical experiments and labs in essays, iterating testing, experimenting to see what molecules work or what protein does what, and if he finds to the target, and doing more of this in silicon, as is being called, which is in software. And rather than just doing testing in software, you can actually use tools like alcohol that can be predictive of large molecules and how they can drive outcomes to make decisions about what to put in your pipeline.

So if you take ninety nine percent of the junk out of the top of your pipeline and you only focus on the one percent that the software predicts will be more successful, you much more quickly get drug discovery through the pipeline and you have a much higher hit rate. So the r AI is extraordinary, particularly when you're talking about multi billion dollar revenue streams coming up the other end of that pipeline. And so I think you know the way this reads, these guys raise one hundred million dollars in around last year, sold the company for six hundred million IT seems very similar to deep mind being bought by alphabetic years ago, where the application of the the team is pretty brought across the number of opportunities.

But bio on tech bought them to focus on the kind of farmers space. So I guess, tax, you know in in the earlier stage, you know I see a lot of teams now they're like k we're A I for this or M L for that. Uh, a lot of farming biotech deals have to have the catch phrase M L A I uh in the writing now because of the economic improvement of those businesses.

Are you looking at enterprise software businesses that aren't necessarily about the typical subscription model where you sell A A seat license and people pay for that, but have this broad tool set and tool kit where these folks are earning revenue share or participating in the services revenue stream for enhancing the value of their their, their, their in the A I R M L space? And what's the Better business model? Because I think this is where so many new teams are starting out. Is what's the business model in which should we be focused on .

with our mall kit means no done deals like that, uh, when we were not former investors. So I don't know how I would be able to evaluate even if IT is a software product, don't know how to evaluate its effect on former outcomes. So I mean, we have no ideas. Other verticals.

I mean, like do you look at M, L and A, I companies that are more services or partner oriented versions, just selling seed licenses to a software tool?

I mean, is a big anger. Tell you what the trend is. We did a deal called perl, which is creating an A I for dentistry.

So what i'll do is IT scans in all of the x rays and you know demo records from from demo proxy. And that gives kind of a second opinion. I can spot things like cavities and things like that or this changes in the condition. Where's really powerful over time?

I if it's got your last six sets of x rays over whatever six year period IT can detect changes that are probably you know hard for human to see so they think they can get to, like, Better than human serve diagnosis by using computer vision. And then we invested in, in sort of after that, where we realized, okay, this is like a powerful application. So we invest in something called robot flow, which creates tools for computer vision.

So Pearl created its own tools for taking a large number of, you know, x rays and classifying them, and then creating their own A I tools. Robot flow gives you that same tool set, but you can run IT on any computer vision project. And they seem you building a pretty big universe of software developers who are using their tools.

And in this case, this was a team that was bought. They bought a cute and fifty percent team for six hundred, a million dollars that just had this capability set, really, and a tall kit. Does that change your outlook for investing in M, L, A, I companies when you see a six hundred million dollar exit for effectively a cap at that? They didn't have a core product that was in market. They were doing kind of these code development deals. But I mean, how much does .

this A A is already A, I is already the hot thing. Everyone's kind of looking at this now. I don't know. Like you never want to base an investment decision on the fact that some acquire might come in and and buy you for a large amount of money when you have no revenue or business. Man, I just think that does not really .

although IT does seem that AI engineers go for two million each, I think he's got to your point.

Yeah, I mean.

you deep, my god. For one hundred by google and they think they had two hundred people, was hundred IT does seem like and I think deep mind did not have a business concept in mind when they .

were funded. They just want to search like some of these platform capabilities end up just getting bought for, you know, huge songs yeah because .

going to me is this strategy, S X.

The amount you can .

invest in a company hoping for an unreasonable acquisition make meaning unreasonable .

meaning a yeah like .

unreasonable meaning that your own metrics don't reflect that valuation as a business you might be worth at as a strategic acquisition of somebody else. But you you actually raise anything question, which is, is a seat model the right way for one of these companies to Price the product? And you may be write that, that the seat license doesn't really work because like you .

really need to buy for these companies. I an we've been .

this we ve even seen we've had these debates inside the companies I mentioned where like you know charging a ten dollar, even a one hundred dollar a month sea doesn't clearly reflect the value of the insights that are being created. And so yeah, they are like, you know, I don't think this been.

but this is the big question. M N. I, when I was at monsanto, you know, we had all this I P licensing deals.

We do a new products to come to market. And IT was never cost plus or simple pricing. IT was always about value capture.

If in an enterprise setting, you know because we sold the farmers, it's like how much value are you delivering for the farmers if it's one hundred dollars a profit in accor? You try and charge an incremental thirty dollars and acr for that product. And he was always a one third value capture model.

And the same is crew and biotech and farmer. The producer of the product or the code developer of the product is often from a value capture, and it's not a seat license that is not a service feet. More ultimately, we wanted get a royalty on the outcome, on the improvement that we can deliver to you. And so there's all these novel business models that are emerging, at least that i'm seeing a farming and biotech to participate more meaningful ly ultimately in the drug development outcome verses just getting charged the fee for doing a service or fee for a license to a to a software packet.

The value of these companies has gone down. I was an early investor series investor and company called flight are and health. We sold that for one point nine billion dollars to rose.

That's the biggest exit in the space for this machine learning enable stuff that happened in twenty eighteen. And so what's really happened is the value of acquisition and ema has gone down even as a technology capability has gone way, way up. And why is that? It's because this stuff has yet to be proven to actually meaningfully improve hit rate for these drug companies.

So whether the biotech or rose anybody else, the biggest problem we still have is getting the design space guessing that Better. And these machines are Better doing raw calculations, but they're not necessarily Better at veering towards this design space over this design space. So as a result, you're not improving the the wider the slugging percentage or the batting average of these farmer companies, and that's why they're paying less and less.

So everybody will have this capability as an adjective. The thing that you have to do is sort of what what you guys have said, which is if there is a company that can actually do Better guessing at the top of the fun on the thing that you should probably do is, is give IT away in return for a back and rap share and royalty and that business also exist. So you know, the best performing company in farma is a company called royalty.

Farmer is a twenty two and a half billion dollar company that has ninety percent ebit margins. IT exists in an ireland. It's run in new york by this wonderful entrepreneur public legarda.

But that's what he does. He buy small pieces of royalties, and his whole thing is like the paul gram thing at Y. C. I'll give you just that little amount of support, and all you need is a little lift evaluation to justify giving me the six percent. And the tooling company, the AI company that does that could win.

Who would go to rose, beyon, tacker, lily or somebody else to say, look, use my tools and whatever drug you generate off of me, I just want to three percent realty. And all you need to do is just to show a three percent lift across the portfolio of assets. That would be a killer bits model. Because if you look at what business is done over a large number of successes, that's a Georgeous company.

jack. Well, I mean, are you investing in the seat stage M L A I companies and other novel business models that you're seeing.

not seeing too many yet, to be honest? We have we are seeing people play with ChatGPT and kind of do you know experiments, but you know the more i've used charge P T, we've connected IT to our slack. So you can actually ask a question in our slack in a channel LED AI testing.

And I will give the answer and everybody can see people like playing with IT. You know it's kind of like a party track now I mean, like that face where i'm like, yeah, this is impressive, but I didn't actually solve my problem and it's slightly faster than doing a google search. So I am thinking there's going to be a really good business, uh, created in taking the open source projects and forking them in vertical zing them like sexes, one that's doing dental work. You know, like this makes sense to me.

Somebody should do an accounting. Somebody should learn all of gap accounting, which is prety simple, because it's published fast by all of this nonsensical accounting rules, and give you a hundred percent current tee of no mouth seasons. So for example, you guys saw this brazilian company.

You want A I account that look at this company, look at this company, american, as in brazil, which just torched twenty billion dollars of enterprise value. why? Because these guys were using excel to do a bunch of complicated capitalization and cost accounting, made two or three years of mistakes.

IT added up to two or three billion dollars, and they're basically going to file bankruptcy in the next few days. That's completely avoidable. Human era that should never happen. And an A, I would be perfect for that. Like this is not super controversial to just follow gap accounting.

right? I mean, I talk to me. I don't know you need A I for that. I think you just need software like a database would be good.

But now that the problem is the database exit today, like everybody sits on top of the G, L, workday, IT doesn't prevent these errors. So my point is you gotta get humans out of the system, and the A I should be the account. The A I knows the rules, generates the piano and says, this is IT.

And by the way, that's way Better risk management for the C E. O on the C F O. Because, as you guys know, if you're the C E. O of public company, you have to sign your signature that these things are legitimate.

And how do you know?

I would way Better know that a computer did IT like an OpenAI algorithm tells me to this picture, perfect. Then some dude, I don't know at earthing Young.

okay.

I have a question for sex. Sexy pu, can you please explain to me why alexa ldl in is going to get charge with manslaughter for this trust thing that seems you explain what IT happens on a set with guns and how the how did this up? Like, what the hell going?

Well, i've produced two movies, but neither one of them involved, you know, guns or .

shoot out anything like that. So I haven't had.

like first and and that kind of stuff. Look, alex bottle win did not follow the rules of gun safety. The first thing I would do if I was never handed a gun would be clear that I would like check IT to see if he was loaded and clear IT. When you never pointed that you have somebody, you always treat a gun as if it's slotted, even if you think it's not. But he was in a very specific situation, which has he's on a movie set and the person who is handing him the gun is the armor, someone whose job .

n yeah exactly.

It's somebody whose job IT is to make sure that the gun is handled properly and unloaded all that kind stuff and they're using IT on a set. So I agree with you. I don't quite understand why alec baldwin is liable in that situation for the gun going off, the person who screwed up here, the person who screwed .

up as the armor.

the person whose job IT was to never allow live ammunition on the set. But the guns proper .

are highly most point of gn Terry .

movies was that they were fine blanks.

Yeah, they were you in black, but they had blanks and regular ones in their kid, for whatever reason, because they were shooting real ones as well. This is involuntary manslaughter. And I think ball win is also the producer of the film. So I don't know you with this .

hiring of the armor. Speak to listen you. You frequently give stars in an independent movie a producer title. He's not responsible for the physical production of the movie. I bet anything he's not there is a guy called the line producer responsible for the phy production.

And my guess as he was irresponsible for the business side of the production, they've got other products for that. So IT doesn't make sense to me if they're gonna charge him for having some sort of overall liability as a producer to then not charge to the other producers that this doesn't make any sense. So I think this produced credit things, probably a read hearing.

Like I said, I think the armor r is the person who is singer's responsible for this situation. They are the ones you screw up. They are the ones who had a responsibility to make sure that the gun handed to an actor.

I mean, alibaba es an actor? Yes, look, conservatives in social media are dragon the guy because they think he's a dush bag and he doesn't guns. But that sounds this .

job he .

doesn't cut .

in movies. Why would you ever have live amigo on the movie set?

You shouldn't. They shouldn't have. You shouldn't.

No, I was so so it's not as if, like, the scene is different if you have a real bull adverse of blank.

No, that I know .

only be blank. If I remember right, there was a story about how the gun armory people were taking members of the cast and crew, and they were shooting guns for fun in the test, and they were doing like, they were doing like targets and messing around and teaching people guns, stuff and just playing around, but using live ammunition, and that that LED into an accident, that there wasn't good .

kind of transition. That's that that sounds like the cause, but at least there are facts we don't know about. I don't know .

why I was just charged. Yes.

that sounds tally legit to me.

So guys, listen, I need to run another call. I was gonna talk about this really um fantastic tic paper on the one of the driving forces of aging has demonstrated by a team from harvard in in in collaboration with many others on epigenetics and the loss of data integrity and epigenetics really being the core driver of aging in a million cells. It's an incredible paper.

IT speaks a lot of what we talk about last year, yun archiv, tors and partial epigenetics programing of selves, how they can reverse aging. These guides have demonstrated IT in a really powerful way. I'd love to spend some time on IT.

Maybe we pump that science corner next week. Wrap up for today, I think we talked about all sorts of fund stuff. It's been a real pleasure and an honor to be in, uh, the seat of the worlds greatest moderator.

We missed him today. We we look forward to having his return next week. It's been chatting with the gentleman and on behalf of the all in pod, thank you for listening.

byebye.

Your winter.

We open sources to the fans and .

just got crazy with.

Just get a room or.

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