E88: First principle politics, China chaos & outlook, state of private/public markets & more
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Two days ago.

here.

we in the p sector. I got into a fight. You got got into a fight. I gotten into a fight like a physical altercation. The physical altercation, really. This chick shows up wearing a White wife, Peter, talk in all kinds of ship and I said, listen, lady, use IT and SHE just kept joying and joy and here he is again. She's back for .

more and so I was like.

listen now have you ever her look .

at that little.

Sway and there is called open .

everybody. That's the good stuff.

everybody. I know i'm not a bo, I know i'm not a beo, but i'm even Better. I have my own thoughts.

Sax, what your seeing here is called the fection between a .

parent and a child.

The world in world I don't need .

to watch boost is creating by using his kids as okay.

freeze g wears your puppy that you said for big tortured with kim hardacre is lip loss.

Guy, because he is Better, rob, get the .

props out of .

the shot.

We are the fans and.

Sex, what's up with the jade vans in ohio? It's going to pull this thing off. Is he getting beat up by read an article about him getting beat up? Uh, with the Peter teo connection being .

he got physically beat up?

No, no, no. Like in the point, no, no.

no, no. I think 绝对 是。

He's gonna wait, right?

Yeah.

I think so. And what about Blake masters? These are the two guys that teals backing we start the show.

What kind of did here? Can I ask your question if any of us entered porn, wouldn't one of our names be great masters? Like it's just wouldn't IT be on the list like, doesn't IT sound like a great isn't in a great name for porn?

It's a great name.

Black masters, it's a great name.

N, N, J, D, still, i'm our events. Yeah, good head. Explain what's going on with this.

You actually I would like some of anything i'm just saying.

Tell us about your mentioning candidates.

So j is already won the primaries, and I expect you will win. I mean, it's going to a be, I think, a red wave in november. And ohio is a pretty red state these days.

Police asked to win the primary in arizona was slow, bit more of tosa. But I think i'll do well. I had to .

follow question, but i'm not allowed to mention the tea word. Let just get started.

Why is this such a big deal that like Peter supports candidate, you got all these like .

crazy levering .

rastus gives unlimited amounts of money to you crazy progressives, like gas going lay in zilia and others. I mean, why why is this such an obsession that we have to focus who Peter supports?

No, I just think it's .

fascinating that really supports active for fake. You know, changing government away that he seeks would benefit the country. And Peters been generally right. What is the basis rebrand? I think part of if you watch the speech from the R N T during the the left truncate cle, I think you did a good job kind of articulating that there's a lot of inefficiencies in government and there's a lot of um call IT accumulated fat.

And we need someone to go in and we need people to go in and really cut this up because so much of politics is driven by what else I want to give you, not about what i'm going to fix that's already being spent efficient way. And as a result, we see debt client, we see taxes climb, we see efficiency continue to decline of every dollar vested by the government. And I think that's a really important pieces to see someone actually trying execute against because no, very few people in the position that he's in to actually be able to like make that sort of statement. Everyone wants something more from their government versus trying to fix the government.

I think his views are more extremely than I think his views are more than orthodox city is ruining in america. And so you need forms of heterodoxy to basically reset that quote. And I and I think that's what he believes more than what you said. I think that you need a whole sale reset. And in order to have a whole sale reset, you need to have these very disruptive candidates that basically start to change the norms.

I mean, if if you think about what trump t did in one election cycle is he's completely sucked an entire cohort of people, his panic and you know moderates and now um you know a lot of immigrants towards the right because the democrats have vacated all of that space in having this massive trump arrangement syndrome and tacking extremely to the left and even if Peter, we will never know, believed in trumPeter, didn't believe in trumper, didn't matter, but the process of him getting that candidate elected over the long arc of history may actually serve to pull amErica back to the center. Pretty good. Alcoa.

yeah. And look at that. The reason why I support jd and belief of that matter is they are they represent this more populist of working class pollick party.

And they are dragon in the republican party and or working class direction. I think that's the future of the party. I think that's the opportunity for the party.

To the mos point, the democrats have seated all the sort of this working class territory by becoming this elite progressive party and the face of the party. Right now, the democractic party is popular. Y, you know, let's talk about this. It's battening out the open. He's trading on chip stocks like invidia in terms so forth, like the week before the house is gonna vote on a fifty two billion dollar subsidy for two .

hundred and more, the week before his wife decides when critical legislation goes to the floor of the house to be voted upon. So you have the speaker of the house, who's the third most important person in government, introducing legislation on her timetable. Her husband trades in those specific equities days, and maybe even the same day of that, they make three times her annual salary just in one day.

And then SHE and her husband decided, then fly not asked by the united states government or the state department to taiwan to then talk about god knows what, which would have created an international uproar. The bite administration and tony blinkin had to basically call her and they stand down. You should not go.

We are not asking you to go. IT is not on the united states gender for you to go. And all that would have happened is an entire process and loop where he controls the legislative agenda.

Her husband controls their private stock account and traffics in the names. And then they go to taiwan to whip up the fuel, which would have actually positively impacted those same names even more. It's inexcusable that kind of behavior.

I mean, after four years, just SHE so past the line and SHE doesn't realize IT. And by the way, sorry, let me just wait. Hold on.

And then on top of that, Jason, the mainstream media doesn't say shit. Now by the way, i'm not a trust supporter. I think he's a complete goofball.

But if trumpet tried to pull this stuff in twenty sixteen or twenty seventeen or twenty eighteen, could you imagine how much media cover there will be? And today, how much of that is covered by the ministry media? Zero was that mention on M.

S, B, C. Note was the mention of any. The Price note never .

just set the stage of, people don't know, we are talking about. So on tuesday, the senate advanced a slim down version of the original chips bill. You don't know what that is.

It's basically a bill that's gonna de fifty two billion dollars and subsidies to move chip manufacturing here to the united states. Something we really need to do is a byproduct belt. Everybody kind of agrees on this, but this is being kind of stuck in committee for a little bit. Um becomes a year after the center of first prove the two hundred and fifty billion dollar l to reinforce your chip making to compete with china.

The reason why this is strategically important is because we have a huge chip dependency on taiwan, which is from china. So if chips are the new oil, you know, taiwan n is the new middle east of the new person. Golf and IT is a very dangerous situation for us to be completely dependent on tai I.

Well, not completely, but like for over half our chip. So on sharing an advanced chip manufacturing makes sense. But I think this is an example of how you you start with a legitimate objective in washington and very rapidly IT turns into corporate welfare and graph by politicians. I mean, that's yeah I mean, just to answer, manufacture does not mean that you give intel and video a giant handouts and then you got poor polis making millions trading .

in video options.

Something have you done sex to support on shoring of semi conduct manufacturing? Who would you give the money to? And how would I be dot or the terms of IT be?

I don't know that give these companies money. I mean, I think maybe what you do is you give tax break vary kinds of breaks. But um no, I don't like they .

need capital to support that investment because you know you look at the um kind of R O I C on these companies, I would ever look. But i'm guessing there in the high teams or something that the high teams and they're not going to be able to invest in some new fangled you know fb project that maybe may not actually have customers. At the end of the day, board would never .

approve that on an independent return .

on invested capital. So if you're a big industrial business, know one of the key metrics s that your shareholders look at is the the the ultimate kind of profit, profits that are generated from a big investment you might make. And so you know, you kind of look at that over time.

You look at the invested money over time and the cash return over time, and you come up with this metric. And so the key metric for particularly capital intensive businesses and so business like in teller and vid, I would imagine it's gonna have a pretty tough time selling their board on some speculative on showing fat project. There really does need to be capital and acceleration of capital.

Who feeds you this bullshit propaganda? Intel in twenty twenty approved to share purchase plan where these guys had a hold of a hundred and ten billion dollars. And i've spent all of IT, except for seven point two billion. They have six billion left on the baLances.

I get IT, but they're not going to put that money at work, right? Like like you might imagine.

you're on the board of intel.

They're like government, okay? So because I make the money.

I make a of money, I have no Better ideas of how to do IT, including theoretically building a chip factory. So i'm going to go to the government for a handout. Meanwhile, i'm going to take all the money that I had, which I could have used to fund this thing, and i'm going to give IT a way to people who I don't know .

what they're going to do with that I would reframe IT. I would say that the government wants to see our industry on shore semiconductors, uv turing, and they are going to the companies, not the companies, is going to the government. They're saying, we want you to ensure semicon s to manufacturing.

Do that for us. Now, like in world war two, we want to the automobile manufacturers and said, the government said, we want you to make airplanes. Here's a bunch of money, make airplanes, and that's as a country. But who does that go? Who else would you give that money to besides the two best chip makers in the world.

David, with if you just give us a capex subsidy, that's a one time effect that helps you in a moment. IT doesn't help your business. Any reasonable investor who can actually use a simple calculator sees through that nonsense.

So what David right is if you are giving them sustained tax breaks for being able to build the business line that then supplies things for the duration, you know, tens of years, you're absolutely right. Investors would load IT. IT would make a ton of sense.

They would be over earning over a long enough period of time where people would have to take that into their cash ful estimates where when you discounted back, IT would make the enterprise of intel and in video worth more and then people would then want to own that stock more. Giving a capex subset is a meaningless way in which you basically hand out good money. Two organizations who have otherwise misallocated the money that we've already had.

Yeah there is a much similar solution. Sexy point of like how do you do this? And giving free money is not the way to do. The best way to do is to give an incredibly low interest rate loan like a thirty, forty, fifty year alone.

That baby has some warns that it's just like, you know, a silicon valley bank where A O america, I give an adventure dead loan where the government actually could make money from this and then you can send them with something that is just too good not to take a fifty year alone of five billion dollars to build factories. You have to use IT for that. So it's use IT or lose IT.

And then you slowly pay the government back. And then maybe we get some warrants in in tailor who ever give the money to. This is something that obama did with a ceLinda, which didn't work out, but he also did IT with tesla.

And tesla paid all that money back early. So these loans that the department of energy did really did. And we got to a rock, obama lot of credit for this. IT really did help drive, even though IT wasn't the way I did drive a lot of AV adoption. IT did really help test to become the .

company is today. Sorry, let me just for point because I don't know how much, much we've we've gone through the details of the bill, but there are several components to this bill including a and I just want a highlight if i'm on the board of intel, i'm not going to make a ten billion dollar fab investment um because there may or main O P O profits down the road to justify that size of an investment.

So if the government comes along and says we will support, we will cover x percent of that investment. I can take on more risk and I am more willing to make that investment. And theoretically, I can afford to pay people a higher wage or higher salary because I now have more capital, freeing up to support to do that. And so there is an effect that, that arises by having the government come in, put some money into these projects, accelerate their outcomes and IT gives the the business more free.

What should I be? Freeburg free money or in the form of a loan. So what should the financial device be, I think, is the question that U. S. Sax, if i'm interpreting?

great. yeah. I'm not sure that the one, the one doesn't resolve the fact they're having to money, right? And so they're not necessarily going to make this on sharing investment.

But the rational capitalist decision is to offshore manufacturing for intel, irrational for them from a business perspective, from a board perspective, from financial of to ensure manufacturing. So the reason they are going to do IT is not because they're getting alone where the interest rate is low. That doesn't really solve the problem.

The government saying we're going to put a ten billion dollar facility. We want you to build IT and manage IT for us, and that's effectively what's happening. And now by building the ten million doll facility, we've created security for the rest of the U.

S. industry. It's worthy to the government to put that money up.

Security for our cony? No, I want. Why wouldn't create .

security if if we have more on sharing of chips? And say one more .

thing is also an investment tax credit built into this bill, sex, which does provide over time a bunch of incentives to continue to support and drive the on showing work that's proposed in the bill.

If you want .

the united states point of personal villa, can request d one button to shirt. Yeah, yes. Is you .

too distracting for you?

你 这是 first to .

watch .

Jason to the I want to say .

one more thing .

about the .

policy stuff。 So here is the data. I don't know you guys have looked at the full history of the poli trading. Da, here's the life. So trading that time over a couple years.

And um over the past year, he has bought in video of four different times each time in the same kind of volume range. So the timing certainly may appear a suspect and it's certainly a terrible kind of thing to see. He's also bought apple in the last month.

Microsoft sorry, he sold apple. He bought microsoft um he bought alliance burn scene earlier in the year. He's made a few trades this year, but in video, he's actually bought on four different occasions over the past twelve month for whatever that to work, right? I'm not not trying to defend IT, but I think we should be intellectually honest about the fact. But this guy, you know, does take points of view and certain companies anties.

Are we to be intellection honest enough to think that a husband talks to his wife and vice person? yeah. Or does i've done to happen anymore?

Depends on the husband, wife. But I think .

this is blatant and out in the open. I mean, IT looks really, at a minimum, the appearance is of graph and corruption.

The appearance of improperly is improperly. They shouldn't allowed to trade. They should have to put their stuff in the blind trust, or they should maybe trade once a year, and they should have to announce their trades before the trade happened.

Hey, here's what I am planning on doing. Just like a CEO is planning on doing this stuff. It's ridiculous that they can do this.

And if I just the mainstream media cover this, don jon, do you think think that truck, if IT this had happened during trump.

IT would have a lot .

more coverage. Member, a coverage on IT. Lets covering IT like fox news. And then zero hedge, you know, that's IT. I mean, that I find out about IT is like the zero hedge tweet about IT.

So daily beast, you know, headline seven hours ago, dams quietly try to damp polo cy on stock trading ban. But if you are asking me, you ask me a question, trump is the media largely bias against trump and gives a free pass to then yes, I would say that that is the trend. Yes.

I think no. I I mean.

I think the media ais bankrupt are just going for clicks. And I think we've talked about this before. They saw trip as an existence al risk and they just did whatever you talk to get him out of office .

um even put in as they completely burned .

all of their credibility they .

and now the dam are starting to become increasingly detached and out of touch and may be hated. But then the result is that the main item, media is just no .

longer trusted. The mean party both have the same problem, which is they suffer from what the democratic scientists voter is called professional class of germany. I mean, that they are populated by college graduates with degrees who basically have this very a leader progressive agenda.

And that is what is causing the democratic, the working class, to defect from the democratic ty, their historical base in droves. Look at his manics will forever. If you go to the latest biden polling numbers, he's down to thirty one percent approval, sixty percent to approve.

Okay, so the trance is getting worse there. But you look at his spanish is down to fifty percent approval, seventy percent disapproval. It's an even more intense version of the same problem.

You had a ma Floras get elected in the texas. This is a district that went, it's basic, a parliament's mexican american district. They went for biden by eighteen points just, uh you know, two years ago and now they're voting for her by over ten points.

So you republicans winning that seat for the first time, so you have these huge defections. Now why? Why is that happening? Because the democrats are appealing to the donor class on issues like border, on issues like crime and on issues like C.

R, T. And schools, I mean, you, the working class people in this country, they don't want open borders. They want crime to be prosecuted and crack down on, and they do not want an ideological education for their kids.

Okay, it's very simple. But that basically is why the ocred paris losing losing votes. Now i'll be give me a couple other examples of the democracy nics appealing to this sort of donor class. So recently, there's an article about the democrat have spent forty four million dollars this election cycle basically running ads in favor of the crazy mega candidate in primaries. They've been a bunch of reports of this where in competitive republican primaries, the democrats will actually spend money on behalf of the sort of the more perceived crazy republican .

canada election.

Deny so d because of the perception the'd be easier to beat in the general. But I think this is the case to be careful what you wish for because you know, if we have a red wave in november, you're going to end up with more of these candidate spaceless winning. So it's a very cynical strategy.

The other example, I think, of a very sync strategy is you saw there was a vote in the house this past week on gay marriage and the house voted to appeal da the defensive marriage jack in support basically qualify oberg fill right the same court decision on on gay marriage, something like, you know sixty republicans voted for IT. Look, I would have like to seen more republicans vote for this. I think IT should be like, you know, majority of people can, I should be voting for this.

But the point is that, is there any intention of the democrats to bring this up in the senate and pass IT and qualify a bird fell when they have a chance? I think the answer is no. why? Because the democrat rather funded aries off this issue.

The same thing was true about road. The democrats had supermajority in the senate under obama. They could have qualified road.

They never took the chance. why? Because they would rather fundraise off this issue from progressive elites, the donor class in california, new york. So this is why they're not going to be absolutely .

obama said IT. On all the record, obama was asked, why were you? He campaigned on qualifying roby weight. And then very quickly into that, he was asked, when he had the supermajority and put the house in the senate, will you act on roby way that goes? No, what is is not a priority anymore.

That's a good IT absolutely could have been alive, ed, just like a defl could be qualified tomorrow. There ten republic's tes, there are ten of republic and votes, at least for this in the senate. You have a fill of bus to proof supermajority in the city. Who would support this? The same republicans who supported the gun restriction bill that bind just signed and that .

supported the infrastructure bill.

You make a fy and rites in this country right now. No, no, no, no.

I would never give women the right.

No, no. Look, there's a supermajority and anymore for for a qualifying route there is a supermajority right now for qualifying a version file. They could do that right now and they're not too much.

You've been a donor to the democratic party. Did you believe that? Yeah do you believe that the the abortion issue drove you and others to put more money in? And that maybe? No.

no. Because because the leadership of the democratic party focused on a trump in the last big cycle IT was all trump, trump, ed, trump, trump, trump. Do I think that more grass roots fund raising focuses on that or gun rights or abroad .

is true that they actually held off and try to fy road so they .

continue to the quote because IT there's there's no opinion needed. Okay, April twenty nine of two thousand nine, president barack obama says on wednesday he favoured abortion rights for women, but that passing a lot guaranteed these rights were not a trap top priority.

I believe that women should have the right to choose obama told a new conference markings his first hundred days in office, again, when he had supermajority in both thousand, the senate. But I think that the most important thing we can do to tap down some of the anger running this issue is to focus on those areas we can agree on. So you make a promise you get into the city of power, you have the decision on what your legislator agenda should be. And he made that calculation. And David is right, sadly, that I was in a moment where we had a clear line of site to codifying many of these rights.

Yeah, but the question freed, that's not the question that freeman is asking. He saying, do you d think that they specifically did this to keep IT as an open issue to raise money of IT?

I don't think .

that's believable.

Absolutely no way.

If you want to talk about nisa sex, the truly cynical move was you trump saying, I am going to get this eventually vote to win the primaries, to get those twenty percent who wanted take away the right for women .

to have an abortion and i'm going .

to stack .

the supreme court .

to actually .

this define terms. So you may be opposed to what trump did, but there wasn't. That wasn't cynical. He stated what he was gona do when he office, and then he did IT. He lived after his problem.

What he did not believe in, that he did IT specifically to get those, those we all know he didn't believe in IT. We all know he believes that a .

woman's right to choose j he, he created a platform to get elected. Yes, that was elected. He executed on that platform.

I think what David act saying is obama had a platform to get him elected, and obama chose, had the choice. He chose to not execute on the platform. And that is also true.

And all the thing is we omit to ourselves, to be intellectually honest, about what happened. That is what happened OK. Both of these two guys made.

both these two guys make things in your own self.

Can I understand the thing please? I want this on the record. Both of these two guys made claims to become president. IT turns out that trump actually did execute on most of his claims as important as they were to some yeah, and obama, on some of the most important .

issues of our time, did not simple coalition politics. He thought he was important to win the religious right. He basically appeals to them. He said that if you vote for me, I will make these judges the office. He delivered.

He delivered. He didn't .

believe in IT himself .

that people should have principle. So I do principes .

to be of saying that he's going to he's going to pass and codify roby, wait and not do IT.

What is that I V key? I listen. I I the quote you gave doesn't give why he didn't do IT. He didn't make IT a party. IT could also hold on, let me finish IT could also be that he believed that he would not get overturn so he should spend a time on obamacare and other things i'm saying cynical m is when you believe one thing and then you do something to act to your own self interest. And that's, I think, what I think I did.

Second, we don't need to go back all the way to the above ministration, because the issue i'm talking about today is the past week that vote qualifying oberg fl on gay marriage and, uh, repealing da. okay. So now listen, I actually think there were so many republicans tes in the house, even though I would have like to seen more.

They were enough that that this might shame humor into bring up the vote. This is, to me, so obvious, if he doesn't, that he is doing this for a reason, right? Because they have the votes, they can pass this just like they pass the gun bill a few weeks ago, right? Just like they passed the infrastructure bill. So if if humor doesn't bring this up.

it's a very signal move and radially to have the issue of phrase funding I .

get because IT is really proof. Listen.

do you think both sides are cynical?

Course course in politics, however, however, what i'm talking about the type. So I think that there's a lot of issues on which the democrats would rather appeal to the donor class, basic that lives on the coast in new york, california and be able to keep fund raising on that issue and basically scare monger on that issue. Instead of just winning the issue.

they can just win this issue right now. Tommy, do you have less interest in supporting the democratic party based on the principal? You stated that in the past, there have been kind of promises and capital rage against codifying row. And then IT not happening.

They never made those promises to me. So I never felt like they lie to me. I want to be very clear. So then nobody and I never asked for that to be a precondition of my donation.

Again, my capital was focused on one thing, which is I thought that president trump was not the right person to lead this country, and I thought very clearly that the bright democrats could do a much, much Better job. And I am glad that by one, and i'm glad that the money that I put in, maybe no in any small way, but hopefully in some reasonable non trivial way, helped. And i'm glad that that money helped even out the senate.

I'm glad all of those things happened. And so I want to be clear, they've never made those kinds of promises to be, nor have I ever asked. I make a high level decision on who I think the best candidate should be and support the party that will get the best candidate affected.

What I was just trying to make clear to you guys is that sometimes even a democrat is important for us to be intellectual, honest about what has happened. It's very easy to look at the other guy and find all the ways in which they screwed up, or try to screw you, or in a lack sympathy, your lack sympathy. All of these things is much harder, often times, to look at your own team and say, wait a minute, why didn't tex Y N Z happen? And the reason i'm bringing up what happened in two thousand and nine is, I think David is right. We have a moment in time where the leadership of the democratic party can codify rights that should be codified.

And they should have, in hindsight, they should have done IT.

And just to be clear, no.

IT is still A I I T about the weight and talking about now, IT should be absolutely. And just to be clear, i'm an independent. I would vote for a republican who was socially progressive and fiscally conservative as long as they're for gay marriage, as one of your pro women's right to choose, and they were fiscally conservative, I would vote for a republican.

I'm a moderate independent. I want to see less government and more efficient government. And I want, I want the government out of people's personal lives.

And I think that's where sex and I are exactly the same. We both, I mean, sex. Do you want the government involved in people's sonar lives? You are classic republican.

by the way. According to the month pull from a few weeks ago, you represent four percent of the voting base. That's an extreme.

Yeah, that's an extreme minor. The lowest self identifying quadrant of fiscal conservative versus kind of fiscal liberal, social conservative. Social liberal is the fiscal conservative social liberal.

What are we all here? I think we all fit this profile fiscally. We want the government to be run conservatively, you know, and with less government.

And we want progressive social change, right? I mean, we all feel that. don't.

I just asked you guys if we are all.

and I will .

define my cultural positions as progressive social change, because the change that progresses are just, right now, radical, what I favorite, social tolerance. I think we need to be a tolerant, think we need to be a tolerant society. AmErica is a very broad, diverse country.

We need to find ways to live together and find accommodation on issues that are very contentious, that includes tolerance for gay marriage. So look, i'm on board with that. But you know this radical progressive agenda, social change, which includes up ending the 呃 the criminal justice system in .

favor of the question.

what's happening in the schools with C. R, T, and the sort of hypocrites education, look, this should be teaching the basics.

reading parent .

to do the and exact, but maybe progressive .

is the wrong term because that that now has been coated less government involved in your personal life and tolerance. I think we all agree on that.

and I think agrees the great word everybody agrees with tolerance is a .

privilege position to want to have less government involved in your life, right? I mean, many people in the united states have been able to thrive and and survive because of the role the government has played in their lives. And there's obviously on one into the spectrum of extreme grip and on the other end of the spectrum, extreme need that is being met uh, by the wealth est government in the world. And IT is IT is in the middle. Where all where .

do you stand for? How would you describe your politics in these two dynamics? You you also in this four percent.

Freebody yeah yeah yeah i'm i'm here. Um i'm trying to be thought ful about this because yeah.

I think is the idea.

I think that the government's role is to support those in need, not those in want. And I think that the government should be held accountable for performing that role um and I think that those of who can that are sitting in privileged positions and seats should enable the government to perform that role well and we should be positive actors, meaning we should support we should pay taxes and we should help people and um and institutions in need and that are you know kind of for the greater good and then we should be holding ourselves, our government and our our politicians to account for inefficiencies and the biggest concern I have is less about all the people in need needs being met as much as are we holding our government to account for the performance of its services and duties to the american people. And I don't .

like they want, I like this want need concept here. Or can you give an example of where the government, like we people need something? But then this another group that wants something in maybe were overstretching you giving into once when we should be focused on .

needs and efficiency? You'll give you a pretty example I know reasonably well, which is the farm bill passes every four years and the farm bill in order to get a pass in both the house and the senate IT has components that serve both farmers and um support the the foot and program uh so the foot and program obviously supports millions of americans that are in need of food, can afford food.

They get B D cards, they get supporting buying food and is a lot of programs and access that are abled by that program. But in order, but that mostly services the needs of urban areas of cities. So IT passes. That element of the bill is attractive and appealing to the of cities found in the house on the other side and already get a past in the senate where the majority of senators come from rural states which are um have significant farming populations. The farming subsidies are planted in that same bill.

And as a result, because everyone's getting something, that bill as a whole has now grown to a mult hundred billion dollar bill that its past every few years because in order for the senate to pass at the house says, okay, we will give you all these forests actions in order for the house to pass that, the senate says, well, sorry, the vice will give you these food both of them now have incredible what they all yeah the amount of money that wasted that isn't actually surfing ing the original intention in need of either of the parties that represented by that bill is extraordinary. And i've been a lot of time in the farm bill. I actually went with lobby years ago to dc, and I actually met with the senate and house ag committees.

I've gone very deep into the bill in some of the programs in that bill, and it's just shocking to me the same way the palmer lucky shared in all in some and how shocking IT is how defence spending works in this country. It's shocking to me how some of the the programs work in the farm bill and how much money and how much waste is and how much grip there is. And so yes, we are meeting the needs of populations in need in this country.

But so much more of the bill now is about people wanting more in order to pass and IT is bloated and going to comment and fix IT. Because where is the incentive for anyone to come in and cut that build up? Where is the incentive to fix?

If both sides are barrelling the griffin, then there's no, instead, there are in a dance to to maximize the grip.

So where do you stand down? If if we were to sort of look at politics without the bite in and trumped arrangement standard without the the tribal ism, just in terms of first principles, I think what we're seeing here is we all want to see radical confidence in the government, social issues, you know, and fiscally, how we run the country. Where do you stand? How would you describe yourself now?

Look, I mean, I think of things in terms of risk. Here's what I see um I see that there are a handful of issues that remain in terms of social policy that just need to get qualified. Gay marriage is an example of one, abortion writes an example of the other.

Then and and I think like those are like really to to my perspective, speak about human individual liberty, which I think should trump everything. So everybody should be allowed to kind of pursue the best version of themselves, however, that manifests in the person you marry to in in the gender you express. Not these are like things were what you do to be happy.

You should be allowed to do, period, end of story. Then there are issues where I think are much thinner and as I get older, I become increasingly ambivalent uh or confused actually is a Better word. And gun control is a perfect example of that where I don't know what my right is to go and adjudicated change to the constitution that's been there since the founding of this country.

That's a much more complicated issue. And so I think we have to basically evolve that right to the states where individual states will have very different laws. And part of how you choose to express where you live will be defined by some of those rules.

So that's the social site. Extreme tolerance is really how I would sum IT up economically. So, but, but I think that the risk to amErica imploding, quote, quote, because of an issue in that surface area, in my opinion, is extremely limited.

If I look on the economic length, however, I think there are enormous risks to american leadership and exceptionalism, and we need a wholesale reset of how we create incentives, of how government should work, of how regulatory capture should work, of how the capital markets work. These rules are way too perverted, and it's creating enormous stress in the system. And again, I go back to the example I used last episode.

The thing that if you look, for example, like you know, in that example of swank a singapore, and how there were these three completely different outcomes underneath the most successful outcome was an incredibly clear, transparent and simple financial framework. You cannot spend more than you have. You need to invest in long term programs like education and health care.

You need to make them broadly available. And then you need to have an absolute free market that gets the best ideas to the top of the front. And if you can just incorporate those things, the tax law could be four pages, you know.

The number of regulations could be fifty pages, you know. The simple rule that says to the federal reserve, you can't just print free money. Had hock.

So i'm a much more concerned about the fiscal future of A I think that there's so much movement and progress on the social side, including the freedom of movement of people to different states IT. IT is an important set of issues, but in terms of what drives the outcome and future success for our kids, and our kids is kids. People should not sleep on the economy because if we get this wrong, that will be the tinderbox that lights everything on fire.

Sex, when you hear you know everybody sort of explain their basic uh, belief system, how far apart think we all are on this podcast because and that's been A I D issue, we see a lot of the fans discussing you and I discussing IT feels like on most of these issues and I think that people asked me how friends with you all the time, and i'm sure you get that question as well. And I love you like that, and I love sex like a brother.

And any time we talk about basic issues, we were very much and sink. And then when we talk about politics, he feels like we're super you know you know opposed, you know in opposition to each other. When you hear that we all have essentially the same stack of, uh, fundamental beliefs, how do you interpret this in terms of politics in amErica writ large? And how do we get consensus country to be more effective in running the country for the citizens?

I think the media drives a lot of polar ization, right? Because they're feeding us a bunch of bogus narrative. You look at the polling around the trust in the rational media has absolutely plum through the floor.

I mean, they basically have itself is reporting objectively the facts. They I think the audience is recognized that they are activists. They are basic pushing an agenda and they're pushing a button, bogus narratives.

And I think that does drive the polar ization. So that's part of IT to go back to, you know what what are the core issues that motivate me and like who I support. Look, I think we could probably agree on a lot of stuff I want to to pursue more with internally cautious, you know agenda less interventionist.

IT really hasn't worked out first very well of the last twenty years with all these wars that had failed. I wanted to be fiscally responsible and promote a healthy economy watch mode. And then third, I like us to be socially tolerating.

Why does that lee meet in this current environment? Support republicans. Well, on international, on sort reign policy, neither party is really very good.

Both parties are sort of pushing some version of bush doctor and light where we're basically over involving ourselves in all these countries, all over the world. But the republicans at least have a faction that's in favor of of realism and restraint. So i'm trying to help kind of push that direction within the party.

The democrats just are still very much in this liberal intervention, this mode on fiscal issues. Both parties are guilty of overspending and creating this lunas federal dead and deficits that we have. However, there's no way to avoid the fact that the requests are just worse.

I mean, biden wanted an extra four trillion of spending on this whole build back Better on top of the fort Riley, and he had. So listen, I know the republicans don't have clean hands on this issue, but the progresses are just worse. As long as the progressives are calling the shots at the democratic party, they're just worth on spending.

And then he got social, listen on the issues, on the sort of key rights issues that have been the kind of the old social issues last fifty years, by and large. Not at all these things by and large. And with you guys that i'm in favor sort of the the socially toler position, but look at who is pushing social and tour today.

I mean, the progressives are the most intolerant a group in america. They are the ones pushing cancel culture. There are the ones trying to shove their positions down the throats of or near americans.

This is what's creating the backlash. You look at issues today, like C. R T, like the progressive approach on crime, on borders.

The progresses are trying to promote, I think, a social policy that is fundamentally intolerant and doesn't accord any respect or room for trial. Americans to live their lives the way they want to and you have to be tolling of them as well. We're not onna have peace society without some tolerance of the .

trellis o what's and then move .

to china I I sent you guys um this is as a quote by mix sAlina, a tweet from mix sAlina. The caption is i've been wondering how they were going to spin this in this bills exactly on on David. He said here, when the nipa poll came out and about, approve, disapprove about president biden, you know, the big outlier was the hispanic population. Nineteen percent approved, seventy percent disapproved.

And the the article in the washington post, which tries the kind of sort of like clean this all up in White washed, says fake news speaks many languages, but it's particularly fond of spanish, essentially saying that, you know, the the fake news problem in in the spanish language has basically gotten so bad that, you know, this sort of explains why his antics have have moved in droves. And it's like a whole race badding cheap shot article. But the point of all of this is just to show that, uh, the left, this is what really does kind of me out.

They are. They are probably more intolerant than they've ever been. They are the intellectual dishonesty .

like if Rachel matter really wanted to increase her standing a position, he would just start the next program with Nancy policy strains and say, listen, we all know. Let's call this what that is. It's not cool and here's how we should change. You'll never do IT. I know, and I think that's the disapointment about all this.

okay. So let's shift now. I think we think I think I think I think if you are sort of purple and centrists, I think the first two years of the by administration, we're really a missed opportunity because I think there's sort of this conventional wisdom that the parties to apology, I can get anything done.

I think we saw actually there's enough revolving votes or there were in in the previous congress, current congress, they got the inflections built done. They got um the gun built done yeah with the red flag laws and so forth that we talked about, they can get qualification of gay marriage done if they want to. They could have gone a the electronic contact form.

So bin hand gone all the way with this progressive voting rights agenda is focused on reforming the electoral contact. Then you could have prevented the situation like we had on january six, that what, what was happy inside the capital, not outside. So there was a lot of stuff they could have passed, and they didn't.

why? Because in in the first half of administration, binds been completely captive to the progressive. There's another thing as well, you could get a child tax credit past.

You could get romney would basically be the four leader on that in the senate. They could pass a child tax credit. That's the most popular part of B, B, B. Why don't they peel .

that off and vote on IT?

That's right. The presses are holding and hostage saying that we're not going to give that you unless you do the whole anchor tin. Of course, it's no those for that.

So I think there's so who ultimately is the culprit for allowing the staff, and we're partly buying, but also wrong, cleaning the chief of staff. I mean, they've made, instead of trying to land to the center, they should have realized, hey, we are fifty, fifty president, right? I mean, we have a fifty, fifty senate. We should be triangulating. We should be building a century coalition.

Wrong claims, but has been letting moderate biden had a clear path to go right to the center, pull everybody and pull the working class in. That's been supporting base who's the working class and is who he is and and he blew IT by going too far to the left. If he wants to save this presidency, he should go straight the and get all the working class behind him. By the .

reason the guy that went to some elite, you know uh east coast liberal art school, we got a masters and you know fine arts and is four hundred thousand and death. That's not so biden, but he's let all these people run over the White house.

IT is too late now because I think was going to happen. Well, the publics going to win .

the house at least. How much shine did we spend talking about cancelling student deck for who?

Now for a bunch of people with degrees from, yeah, even less than this glitters on both sides, it's disgusting. And we need to get to A A version of politics that maybe is more like our conversations here.

But let's let's p IT to another society that we thought was going to roll over hours but um and that we were in we were behind on in terms of competition, china's in chaos right now apparently um in terms of slowing economic growth, bank protests, mortal protests, exactly what I predicted last year when you guys we're talking about china was gone to dunk on us and I said, you know, it's very hard to run these authoritarian countries and uh the citizens like to protest when they get the short into the the stack and here we go chinese economy is is growing very slowly。 They were going to do five and a half percent. This year they're only point four percent in q to cover IT as a lot to do with this. But there's been a series of bank protests and the media has been trying to figure exactly what's going on here to just set the stage here. Rural banks in china, uh, in a couple of provinces throws a bunch of peoples uh, withdrawal in April OK sounds like the crypto uh and in many ways they had been offering unusually high interest strates also counting like the defy a grip going on here.

No, I think it's I think it's more like two thousand eight. And I think the financial I think it's more like the financial crisis in two thousand eight that was driven by the real state buff, yes, the little state bubble.

which is collapsing, correct? And multiple things going on at once the authorities happened, said, how much money is frozen? Uh, protesters claims billions of wine, but it's hundreds of millions in the U.

S. After weeks without a resolution, customers have been begun protesting. Plain cloth thugs have been hitting and kicking the protesters.

And as of wednesday, a video and viral of the C, C, P, bringing in tanks to protect the banks. Very, uh, evocative of the elements where course so good. yeah.

So china has a very explicit zero tolerance policy on covin. Why do you guys think they are so extreme in that policy? Like 我们的 any any ideas？ Like have they explained why IT has to be zero tolerance? They have not explained that.

Um and if you believe that they're the origin of covered, maybe they have some insider information about long hall covered and there was something I want to talk to feedback about about if he thinks this you know long term cove IT stuff is I really acute .

issue but freeze bite what is yeah I don't let me I can .

I answer can I answer that if you don't want to listen? I think the .

answer is very simple.

But we .

talk about .

the the covet. I think this is coming directly from SHE. This is his policy. And I think that earlier in the pandemic they were hAiling their response, which they saw as orderly and effective at controlling covet and they were contracting that with the chaotic western response.

And so I think that the um credibility of C C P and g himself got tied up in this idea of stopping covered entirely of zero covered. And so I think this is coming directly from the top and is having a huge impact on their economy. And I think this is one of the dangerous aspects of a autocratic system is you got one guy at the top making the decisions. And if he's wrong, there's not .

really a great feedback. Yes, exactly the .

calls a situation in china. I think about five hundred years ago, there was a chinese emperor who banned ship building and banning having a navy. And because of that, china shut itself off from global trade, and IT fell well behind the west, which then export and captured the new world.

Is this question about, you know, the chinese. Chinese cultural civilization was much more advanced than the west, than europe a thousand years ago. But basically he fell behind. And a big reason is because this unilateral decision by one emperor to basically close themselves, often through the world.

So you have to wonder, does this, uh, autocratic move by g basically doom the economy to a recession that seems like they are not learning from our experience. These lock down and work, I mean, you can't stop the virus is eventually going to get out even I saw biden got the virus this week. I mean, it's out right .

is endemic now after making a bunch .

of heavy hey decisions like this. So you besides lock down IT, it's also the crackdowns it's the crackdown on the tech industry. Ah the tech funding has plummeted.

Uh, and so has so L P S are no longer investing in funds there with the exception of squares, which seems to to be struggling but is still able to raise the money.

And then additionally, uh, founders can't raise money and founders are questioning when they meet with VC if they can actually, if the VC are just meeting with them theatrically, this story that came out this week and F, T, if they're just meeting with them theatrically because they want to still hold out hope that they'll be a venture capital industry, but there may not be a VC industry in china anymore. Let me just give you the housing stuff. And then freeburg, I know you want to try me on this.

So there's also mortgage boycott happening at the same time as this fugazi bank stuff happened. The bank stuff seems to be not the national banks. These are vocal banks that apparently could have been winning some kind of grip where people deposited the .

money and they ran away a lot like the savings alone. You are behavior in the nineties and in the.

and these are regional banks. To be clear, this is the national banks. And so at the same time, the mortgage boycott ts are happening in three, three hundred. One unfinished developments in ninety one cities, home motors accused and developers are fAiling to deliver the apartments they're already paid for. According to bloomberg, seventy percent of housing wealth in up in property.

much more than the us. This is a downs am of the whole ever grand thing. You got every grand, every grand basically defaulted, and there are whole bunch of people who prepaid for their homes and so they're ready paying mortgage. But ever grand never finished the homes and now they're rising up because they are saying, why should we pay for a home that was never delivered?

I just wanted like take a zoom out because I think it's worth, you know, we can focus on any one of these particular things that are happening and try and diagnosis and I sections. But if you zoom out a little bit, I think of paints a more interesting picture over the last thirty years, right?

The chinese economy grew from three hundred eight billion to one thousand nine hundred and ninety to ten and a half trillion in a twenty twenty, right, incredible growth. GDP per capital, you know, grew a kind of in a similar a ratio right now from three or nineteen box per person to twelve thousand, five hundred dollars and thirty years. I mean, really unprecedented, the history of humanity.

China now accounts for twenty percent of global GDP from less than two percent ninety eighty. Now if you look at historical, we drove that growth. We all talk about manufacturing, right? Manufacturing council, about a third of the economy and manufacturing as a sector was growing in china twenty five percent you're over year in two thousand and eight and then um only grew six percent in twenty twenty two.

And like basically you know kind of reaching an all time low in recent years. So that historically been the driver for growth of this economy. So much of the um you know the the the the bargain between the people in the chinese communist party has been keep giving us a Better life, keep growing our economy, keep giving us more housing, more stuff, more food, more safety, more security, will support the ccp.

And the chAllenge that the C C, P is having is that a lot of that growth, the core growth engine, is starting to slow. The manufacture turing is slowing. Then real estate was growing and a real estate accounts for seven percent of the chinese economy.

And i've got a good start for you guys here. In two thousand and five, two hundred and fifty million square meters of real estate was sold in china in two thousand twenty one, one point five billion was sold every year. It's been incremental.

So the amount of real estate that being produced and sold was increasing like crazy this year collapsed. So it's all it's down like you know, forecasts to be about one point two five million. And now so the first decline in real estate building and sales. So that part of the driver of the of the economy in china is now collapsing. And then the financial services sector accounts for eight percent of the economy.

And that's been growing because it's leveraged of manufacturing and real estate and all the capital is flown in, all of which is slowing down and stopping fifty eight trillion dollars of assets in china, generating about seven hundred billion dollars of annual profits for the financial insurance, banking, lending and so on. So a lot of the conflict and the things that are starting to fall apart, which may just be the tip of the iceberg, is a function of a fundamentally slowing economy. And the forecasts of my outlook for an economy that doesn't have the drivers attack historically, and things are starting to come off.

The wheels are starting to come off a bit. And so you know, look, the advantage they have is central planning, long term investments, being able to kind of be thoughtful about this. But in order to do that, they're certainly gonna be a need for the C, C, P.

To key people online as some of the long term that hopefully play out for them. As they would say, in order to do that, they are going to a have locked down and other sorts of mechanisms of regulatory control over the people. But really, this could be the beginning of some of the unwinding and real concern about um you know is there a core economic growth engine in china that can save them?

And what would be I think all of this if we look at what's happening in the economy, large to math, you know the global slowdown plus inflation is now causing a stress test on every country. Strongest stress test showed us what's happening with their farming issues and with corruption. And here in china hit the stress test, I think you would agree, showing what's going on in terms of, you know, banking, mortgage, real estate and obviously this surging middle class and what their expectations of life are. So what you take on what's happening in china and are they you know how does this um add up in terms of our rivalry with them as our contemporary.

At a very macro o level, china has one massive, massive, massive problem, which is one of population. It's hard to get an accurate count, but IT is an aggressively aging population, which was the result of the one try, the one child policy for a very long time. China has sort of been on their heels trying to adapt that policy.

But really the the last data I saw, I tweet this out, I was a little while ago next. So maybe hard feet to find in my twitter feed. But IT was a projection of china's population, which essentially showed a contracting by almost fifty percent by twenty one hundred.

So and so IT, that's a really, really bad situation. Now when you have a slowing population, then the economy has to north. Why is that when you have a Young population? So for example, take what china was twenty years ago when I entered the W T O, or what, uh, india is today.

When you have lots of lots of Young people, you can on rap them into economically productive activities like manufacturing. The problem when those folks accumulate middle class income and wealth is that they age out of those kinds of jobs like they did in america. And what we seek, our services and service level jobs. And you spend more money, you spend IT in a different way.

So as populations age, your economy has to turn over unless you have a large bull work of Young people that is constantly growing to take up more of the slack, the economic slack, to pay for these folks who have different lifestyles, more savings and different needs, specifically health care, that's china's enormous y big problem. So when you see them talking about six percent GDP targets, and you think, how does the country that big even grow at six percent? It's because there reverse engineering for what they need to create economic vibrating y in that country.

And so when you start to look at two percent, which in amErica you say two percent, great. We would like high five each other for two percent. Uh, that's not a sustainable level of growth for what's happening inside that country.

IT does not create enough of expansion economically to cover all these folks. That is a really, really big issue. So as that happens, I think what we need to do is figure out how to be competitive.

Now this goes elderly back to our first conversation. Subsidies don't make us more competitive, things that governments can do to make us more competitive or long term, drawn out tax incentives that change the earnings capacity of companies. why? Because in the capital markets reward those businesses.

Jason, you just mentioned that. Why is the chinese capital markets in difficulty? Nobody knows what the long term earnings are. How do you forecasts IT? It's not simple anymore.

It's not a model, it's not an interest rate, is not a discounted at a cafes, right? And so that's how they need to reactor themselves. They need to have a much larger population. If you don't have that, you have to figure how to do IT with immigration.

If you don't have that, what china has done is they've tried to go to southeast station to africa and they've tried to create that synthetic form of a growing pyramid right now that can work as long as the baLance sheet of the country supports that because ultimately, you're still talking about moving money offshore. okay. So I think they're in a little bit of a there. They're a pretty difficult spot.

The most difficult spot is when they put that SHE put them in, if you get rid of entrepreneurship, if you get rid of high growth companies that create the opportunity on a global scale, and then you, you know, take dd off the public markets, you don't let education companies become public, or you you basically get rid of their little coorting of capitalism and venture capital.

Their whole, the whole society is going to become slow growth and slow growth in a country that doesn't have safety nuts is really dangerous. Sex, your thoughts in terms of competition for america? Okay.

let me get to the the competition of second disabling, which mos said the the birth rate that are the fertility rate in china slipped to just one point one five in twenty twenty one. So last year IT takes two point one just to maintain your population or replacement level. So and this is lower than even japan, which is also shrinking, is a condition.

But one point three, the U. S. Australia, one point six, but we get above two point one because of immigration and china's have that.

So they've got a huge demographic prompts to mars point. It's going to be something like, well, the population is shrinking by forty percent with every generation. That's what these numbers are employing.

The number is are is going to be under six hundred million by the year twenty one hundred. But I I don't know how wouldn't be lessen that if IT keeps going at this rate. So there in the the the commentator Peter uh zi han has I don't know if that's right. Like Peter is I and or something anyway, he's point out that china is facing demographic collapse in the next decade or so.

On top of that, like you're saying, Jason, that you've got um g emphasizing malley economics, he basic says thinks that the chinese economy, again, he stresses the need for socialist characteristics and he seems we bring back that sort of community logy to their economy and they basically really crack down on entrepreneurship. And venture capital is really a cell phone. I mean, they've moved away from the policies that have made them so successful economically of the last forty years.

And then on top of that, you ve got this deck crisis in this housing crisis. So IT really looks like the decade against them. And you're asking, what does this mean for us? Well, I think IT depends on whether you look at the economically or geopolitically.

I think if you look at the economically, you'd say that is bad for us because our two economies are economically linked. There's lot of dependency. They've love together for a long period of time. And there if china has a collapse, then that there are so big now that that's gonna. I think global repercussions there is going to to be contagious.

But the truth is, if you look at a geopolitically and geopolitics is more of as the baLance of powers is your some game, you can always can be a positive some game, but the baLance of powers is definitely a positive some game. H, you'd have to say, is good for us. Because the reason why china becomes such a threat is because of its growing economy over the last forty years.

Yes, and luck. I mean, what they've done and what they've been doing over the last decade or so is translating their economic might into military might. And that is given them the capability to now threaten their neighbors to become mobile ignorant to basic around the sabor against taiwan. And if their growth, if their impressive economic growth continues for the next couple of decades, as IT has until now, there is no question that they will. They will basically try to assert there her germany over east asia and a taiwan will be a huge flash point, but is also flash points in the east trying to see with japan over the but they're going .

to need a bank rule to do that. So if they do, if their economy is not growing, they don't have the bank rule to do IT. They're gonna to look inward and say, hey, we ve got to fix these domestic problems.

We're going to get people stop protecting the trees we need this middle class is demanding of jobs. The great news for what happened to china, and I think this is why the people there are very happy, is the number of people living in poverty has plumbed. You know, when they start tracking the state in the eighties, high ninety percent of people were living in extreme poverty or poverty.

Ninety ninety percent of people were in poverty on the on the uh, global definition of IT. And now, you know it's just plum ted to, you know couple of hundred million people, so a couple of charity here. But just in the data is obviously, it's very hard to understand what's going in china because a lot of IT is a pig.

Just the number of people on a percentage basis living in poverty has gone. And now the number people who are in the middle class has surged. That creates another dynamic.

Those people want to have a great life. They want Better jobs. They don't want to work in factories. They want to have A A more formation based economy in in a Better job than sixty hours a week in a factory. That's why they're moving in the factories to african other places.

I am I I don't that's absolutely through. I I think that china's manufacturing sector is is aiming to evolve. So you know china has about three million factories or manufacturing facilities throughout the country, uh employing about one hundred and twelve million people.

The U. S. Has about three hundred thousand factories employing about twelve and a half million people. The output of our factories is um uh about seventy percent of the output of um of china's factories, uh in an aggregate, sorry, the total production output of all the factories. So we have very um high value outputs coming out of our factories and high leverage. China is observing and obviously recognizes that there is an opportunity probably to evolve their manufacturing capacity to be higher leverage, higher value output.

And so there is going to be, you know, from the long range perspective, planning and investment in technology that allows those factories to become much more sophisticated and create much more higher value products, moving up from what is effectively just cheap labor, putting things together in an assembly plant to being things like additive manufacturing, pretty printing um automated manufacturing by a manufacturing, etta. Um and I think this is particularly i'm gonna be realized because china announced that they're building four hundred nuclear power plants that drops the cost of electricity to under five cents a killer. What hour in the U S.

Manufacturing um electricity typically cost around eleven cents per kilo hour, twelve cents for killing our in that range. So if factories become much more automated, they start to become a function of the Price of electricity in terms what they can output. China's gonna a huge advantage as these nuclear power plants come online over the next couple of decades and these facilities get upgraded. There is a plan, right?

Remember the plan.

There is a question of, do they get there fast enough to drive econic growth that actually supports all these other industries like real state finance. And they have become critically dependent because those industries is only work if there's a core economic driver, core economic engine that's working here.

So this energy infrastructure, this new manufacturing infrastructure, these are things that, by the way, they can do um really effectively because they're not working on four year and sixty or political cycles. They can take a five, ten and thirty year outlook and make a make a plan and and invest against IT what they did for night. I won't count them out, but they're certainly lot of chAllenge they're facing right now. It's a big question mark right now. What's going to happen .

well and IT to your point, factories in china are you know factory workers are getting paid over six box an hour now in vietnam three, in india, even less. And that's why you're seeing a lot of folks. I don't know if you're seeing in your portfolios, but we seeing a lot of folks looking at india and moving factories there. And obviously, japan has been uh, instantiation ing. China is not going .

to just lose their manufacturing edge. They are not just going to say, hey, we give up, never going to mom, they going to try and upgrade the capability of those today and instead putting together you parts for with six dollar an hour human labor, let's start to do the more sophistication.

The next car that turns is what what happens to this factory workers if they've automated out? What do you do with hundreds of millions of people working in factories who now have been turned into robots? And then if they are going to be in the other is information economy. If they're going to be an information economy, you need venture capital and you need new companies to create those jobs and they just kill that. So I don't know what strategy SHE is uh, pursuing here, but IT seems like a bad one.

We could talk about this one at length, but we are going to bring this up. But you are generally speaking, technology drives productivity gains, but it's it's deflationary.

What that means like a practical sense maybe uh, you know that the technology.

so to say to say that you have to pay a bunch of people to make A T shirt and then a machine is built that makes the t shirt, the cost of the t shirt goes down because one machine can just print out a hundred t shirts an hour, or is IT would take five people, you know, ten hours to make those hundred t shirts or whatever is right? So a technology of kind of emerges, and those people are now theoretically out of jobs.

But what ends up happening is those people transition into new jobs that didn't exist before, and we end up seeing higher order work take place. Think about the the world two hundred years ago. Do you think we would have had any concept of people being uber drivers or people are uh you know creating craft and selling them on ec um youtube? Can people being yoga teachers or yoga or yeah yoga teach OK?

They are go to only .

only fans or dog Walkers or all of these the service businesses or you know, industries that simply did not exist before. And so the labor that both that that percentage of the population was involved in historical has gone away because it's been automated. As that automation has happened, it's allowed higher order services jobs to emerge, and that will be the progression of humanity forever.

I will tell you guys, I was gonna tion this. Have you guys played with dully too? Yeah everyday um yeah sure I got the the log and my brother and I was visiting. We were playing with dully too and making funny kind of so so dolly too is developed by OpenAI. Um we all know sam altima, he's been leading that organization to great effect over the last couple years. And um and what they're doing is they they basically scan the web for images, tag them and then applied you know uh a machine learning um you know to basically allow natural language creation of images from scratch。 So the A I can generate an image and you can go to you know uh the internet, look at a bunch of these, but the image is incredible.

I mean, the creative output, what what feels like creative output from the system where you just say, hey, you know, make me an image of four guides going a podcast on zoom in the style of vano and IT creates this that is unique, has never been created or seen on earth before, and is a function of the the learning has been done in these neural networks to to develop this A I, that that can create novel stuff is really amazing. And I started to think about, like, what are the implications for this over time? Think about, you know, the original movie, bent her in today's dollars, would have cost a billion dollars to make.

They had thousands of people, tens of thousands of people, on that set that took years to make. They build giant sets. They can only make one film. IT was an incredible feat and an effort that's what movie making is you know um still today there's teams of people.

Now what if you could speak to the A I and say make photo realistic know Jason and china h having A A battle on a field middle nowhere and now airplane flies over and you can instruct the A I N A I can generate photo realistic visual audio. The A I can even generate scripts and and narrative for you um it's really starts to change the role of the creator, the director. The director is no longer doing the thing where they have to get to just right, make the perfect ninety minutes and then line up all the money and all the people to do that work on that plan, on that program.

They can be much more iterative and they can be much more creative on the fly. They create a two hour movie by speaking to the A I, and then edit the movie by speaking to the A. I.

Change the actors, change the color, change the voices, change the music, just speaking to A, I, to generate of output. And people will consume that output. And I think it's amazing to think about what creators warned of doing ten years from now as A I and these tools proliferate.

And you see version twelve of this, which is version two and what version twelve might enable. And so the role um the number of people that can do that job goes from Stephen spell berg and bob s. Max and a few other people to suddenly thousands or tens of thousands around the world making incredible movies.

Here, dole's image was pulled up of four guys doing a pocket. So we have a ways to go. But yeah that is four guys doing a podcast. Yeah so I mean, to your point, like you, this is going to wear on this.

This is up. So a lot of people like oh, it's just onna whip out graphic designers is are going to wipe out the creative industry. But the reality is the roles that those people are in today will absolutely be gone, but they will emerge and evolve into new roles that we never even thought imaginable.

I will really transform that industry and society. And this is going to be through across everywhere that A I touches. And china as as china steps up their technology in manufacturing, you'll see new markets of all designers .

will have less levels to ask for all the stupid snacks and officers of strops.

What I mean, you need only .

look at designers. The worst.

My god, I M in the one thousand nine years, I mean, there were literally hundreds of thousands of telephone Operators IT they all got now. And not only that.

have you ever met a designer that didn't take themselves incredibly seriously?

They didn't have like, you know, tea that they would a bad very seriously they have like steel straws. Video game designers, i'm sorry, what did you say .

about .

the steel .

elimination waste in my life?

I mentioned to you guys last year this video game I played over Christmas by ana urner pictures and the guy that um runs the studio sent me at the m he loves the pod and they just launched a new video game which I started playing uh a couple nights ago called stray and you literally at you play the game as a cat lost in some crazy world. You're literally a cat. Which of the thing is unbelievable? Actually.

my favorite gay right now, sexes. I play a cat at the stake out, and it's .

really .

a bad pass .

game. Stray dog and I meet another dog, and then we eat a ball pasta. But as long three of pasta, we each come closer .

and closer than we end up. We want to go. Black rock has lost one point seven trillion dollars in six months.

VC funding is down, or amazon acquires one medical for three point nine billion. which? Which one do we want to go to next? Anybody have a favorite here? You've been to look quiet. You got one. You want to go.

We can talk about the walk worked thing.

This is the largest of time of money lost by single farm of a six months period in history, blackrock, as the world's largest asset manager. And that IT was the first firm to break ten trillion dollars in A U. M. Assets under management. Now right now, there eight point four trillion, twenty twenty two ranks as the worst start in fifty years for both stocks and bonds. Chairman and chief executive officer Larry thing on his earnings call at the end of june, only about a quarter of its assets were actively managed to beat a benchmark rather than track at as passive tragedies are designed to do firms passive equity holdings are now ten times larger than its active holdings, although that does Operate some active multi asset alternative tries at arrow. The gap collapse in bond Marks this year has shaken money out of active fixed income funds.

Listen, I think there's less than meets to the eye here with this. I think this was a headline that was trying to grab attention by same biggest loss ever. Look, the reason why I was the biggest loss ever is because black rock is so big.

I mean, and and what is black rock is basically at this point, their index funds, they're tf, their index funds, they just represent market indexes. So you know the reason why IT went down one point seven trillion, because IT started with ten trillion to the average index is down seventeen percent. That's all that means.

We know this. The S M P, five hundred down twenty percent, twenty two percent for the year. The door Jones down fifteen ish. The nasdaq is down like thirty. So this is just reflecting what we already know, which is that the stock market is down this year.

You think it's another um data point to support the idea that active managers, generally speaking and maybe holistically speaking over time, cannot be be a you know the market cannot beat induced. I mean, give a point if you want that as an investor sex.

Well, I think you know you're time about public market investors. I think it's very hard to be I think it's very hard to beat the public markets over a long part of time consistently. I just think IT is now you know the contradiction though is if you have no active managers, then the industry won't be efficient anymore.

So you need the participation of the active managers to help drive ve. The ah the index asm make corrections to IT. So and the fewer active strategies you have, the more inefficient the markets will become, thereby inviting actor strategy. So you know I think it's a good question. I think there are some managers who are who can probably do IT, but I think it's .

a very tough thing to do. Public investor active selector of here.

Here's I been thinking a lot about this. I think that I have this proportionately benefit from being at the right place, at the right time, backed by enormous amounts of central bank money. And so I think we all happen. I think IT is very difficult to be a public market individual stock picker in a world where the central banks are constantly meddling. Because when they do, the best thing that you can do is belonged market beta.

And the more concentrate are the Better returns you would have delivered since two thousand and eight when the central bank started to get very aggressively involved, when individual stock pickers rained the the universe was when central banks were largely on the side ins. And so there was all kinds of diversion, right? Dispersion, meaning good outcomes, bad outcomes, lots of alpha, right, meaning the your performance was independent of the market.

But since two thousand and eight is largely been beta, that's driven the market and the folks that have done exceedingly well for those in tact because we delivered the best beta. And every time we confuse alpha and beta, we get over ski tips and there's always some big out, you know, blow up. So I think my my general takeaway is that, uh, if the central banks stay on the sidelines, individual stock picking rains and active management can win if they continue to be involved and do quantitative easing in all of this other stuff, index funds that a long concentrated market data will always have perform in the longer .

I was watching, warn buffett, answer some questions and one of the questions, and this goes to the law of big numbers like black rock. He was saying, listen, the reason I did Better earlier in my career than later in my career on a percentage basis is because I was placing at a smaller amount of capital, and I was placing IT on smaller bets, a smaller ideas and themes.

And then as I had a bigger chips, zc, I had to find bigger ideas to put more money to work and therefore, more people were looking at those. And so those assets were not undervalued. And so I found that very like uh, insightful in terms of when you participate in the market, if you're trying to pick between very large bets like koto and tpg and tiger we're doing in the grow space sex like now, everybody knows that this company, everybody knows strips of winner.

Everybody knew airbnb and uber war winners, you know, in the late stage, the private, everybody knew facebook was a winner. The sage prime market. If you're battling that out, you know, your email nurse gonna come over the top and pay two billion more than you or mosy o SHE sounds going to pay five or ten billion dollars more than you.

Where is the alpha there? You know where? Where is the game?

Is the fees?

Okay, there you go. And so they were playing a different game and that I started trading this past two weeks because i've never traded public socks, and I wanted to add IT as a skill set. So I put a ple million box into account.

And i'm just trying to actively figure out how does value work there. And you are just starting to make trades that I wanna hold for ten or twenty years and you'll see if I can beat the market that the thing is, what do you want to spend your life doing? If the index if you can put money to passive index and not do when he work well, you know that's attractive as well. So sex, what what do you think in terms of active management, these public markets in the size of the bet they have to be.

I said, I think it's very hard to beat the market consistently. I think it's a very tough profession. I am sure there are people who can do IT, but I don't know if it's easy to predict.

Those people are. So look, I think I think it's something that can be done, but I just think it's a tough, tough game. I mean, what we do as private investors is a little different, right? Because not everybody is in a position to buy shares right available .

to you don't even know the company access is .

limited and information is limited. And in exchange for that sort of preferential access that we get, we have to have to do work. So when you're when you're a public investor in a company, disney, whenever you don't do work and involved at all, we do a lot of work for the companies, and that's why they choose us. And so it's not it's you're not competing as the whole world. I think the public markets is so competitive.

Are you tempted to looking at these Prices? And because I was looking at a company that was trading at fifty times revenue last year, they're racing again. They double their revenue.

So now at twenty, twenty five times revenue, they're raising at lesser evaluation. And then I looked at the public market comes and they're trading at six times. So now i'm like way to .

second the obviously the .

earth was three. The groth at this example was three times fat greater than the public market comes. So how would you assess that?

Well, we're working right now. Is that pretty good? SaaS companies that are growing, you maybe on a trAiling basis of growth reacts.

You are prospectively. They are growing, call IT to in half x. They're trading right now, not trading, but basically deals are getting done twenty times A R, which A R this years .

the run current err is getting that .

like bonus like here's .

you're projected next year, we're going to give IT based on map.

This is current. No, no, current A R is about twenty two, twenty three times. There are now be what .

last year I was .

like hundred times was the real thun. yes. So now there are some where the deals are getting done in the high twenty years. I'd say you're you even thirty if they are, if you believe that by the end of the year, it'll be more like twenty. So but I I think the new levels are landing at twenty, twenty something times A R.

Now what does that makes sense? What to the public as companies? Well, like you said, the sad index is trading at roughly six times but that only twenty percent average growth, right? And so if you're going through .

max ten times the growth right .

and high the high grow as companies are trading IT like seven times um that's for like a forty percent grow. We've talked about this before. So listen, if you're tripling your over year and you pay twenty times, that will be at seven times next year.

But if you're going to two and half three acts next year, that's way faster. So I think there's actually orbitals there. I mean, this is why we'd like doing private SaaS investing right now.

Deals are getting done. I will say that the people who am seeing who are really struggling a freeburg are the people who didn't turn on. I'm going about the very old stage.

They didn't turn on revenue. They were making progress in team building and culture and features, but they just weren't focused on the revenue side. And my lord, people, you got a lot of credit, I mean fifty million, hundred million dollar evaluations without the revenue turned on. Um and and that another faced with not being able to raise money full stop. What are you seeing on your side free work in terms of deal flow in the private markets?

Yeah and raising money ah because .

you have to raise money for your companies.

it's not easy. Okay, i'm .

packed. What's not know? Uh, well, what are the conversations like give us the a total information.

I mean, i've seen a number of term sheet get pulled. So I think yeah, we've heard a lot about companies that kind of during the q one early q to time frame had term sheet were closing, got the laid out. And um there's a number of kind of examples of repricing.

Where are the investors come back, markets of change, littery Price of thing or hey, um we're not going to do this deal anymore. We're going to sit on the sidelines and we told the market settles or R, L, P S actually aren't going to let us fun new stuff. Uh.

so there's A A lot of those things. One for people.

What does that mean? investors. L, P, S, they have investors themselves. Peas are coming to them and saying, do not put more money out right now we are telling you, we are not gonna hire our money to you. We need you even though they're contractually obligated to, they're lying.

Do not contractually obit to, but obvious ly, these are long term partnerships. And so when an L P, you know, our group of L P says, guys, we're not comfortable with you deploying money right now. You know you're a ten year partnership, fifteen your partnership, but then you're going as an as an investor, as a fund, you're going to say, OK, i'm going to kind of a listen to that right now.

Now the the bigger issues in serious B C N D where companies um you know have some uh traction, have some performance, have raised bunch of capital, done a bunch of work. Investors don't know what they're worth. They're like is this thing were twenty five million or hundred twenty five million or five hundred million? Last here? You could raise money at five hundred million.

I mean, look at what happened with a one of those crypto things, those Crystal trading platforms. They raise five hundred million dollars last july, and they just sold the business for reported twenty five million dollars after being valued at five billion a year ago. Yeah and the .

truth might have been more like two hundred seventy million years yeah .

and and so but the series a people seem to be pretty active again and so active again.

But the Price is now for seed loans. But it's a lot easier happening six to fifteen series, happening fifteen to twenty five.

It's a lot easier to get a deal done in a series day because people say, hey, look, i'm going to give you this. You say, OK, i'll take that. I need the money series B, C, N, D is where there's this whole five because there's existing investors, existing shareholders who was saying I don't want to take a fifty percent right down, a seventy percent write down, a thirty percent right down over the last round and fighting and then doing inside rounds and bridge notes and all sorts of other hands to not have .

to take a negative market book here is um you think about like where the opportunities in the market right now. And I think one of the things that happened in the boom is that everyone got pushed go earlier, earlier because deals were so competitive.

And so you know, in the SaaS business, Normally one million of A R R was concerned the rule of thun for getting a series for a basic graduating to a series a that you are ready to go from sea to series in a million of A R. As we know during the boom last year, that number kept going down, you know, half three hundred thousand. And then you would see crazy deals get done that were pre revenue with Price at one hundred plus.

We never did in those kinds of deals. We just too crazy, but they definitely happen. Well, think about the dynamic now, which is, let's say, that that s start up. That has a million of air. R, R.

They can do a series a at fifty, or we can just wait until they get to five million of A R and then pay twenty times and do IT one hundred three. Which of those is the Better risk of just a return? And me tell you, there's a lot of risk in going from one million A R to five million A R. There's a lot of things.

things through the founders. You need to start .

scaling a team. You need a real sales capacity, but also a lot of startups that could sort a hack together and cobble together one million of error r based on non scalable techniques that various start of incubators teach .

like you don't be capable, don't ale to do that from zero one but not one to ten.

right? Well, or it's not that is not okay. Instead, IT doesn't work, right? Like you're not going able to cobble together five million of the area.

You can top ble together one of A R R. You can use the checa to get there. So what i'm saying is there's a lot of risk going from one to five, you find out whether the parks really scalable. So what is the Better deal?

We till one hundred retail Price .

at one hundred or hundred and twenty million three, or doing the deal at forty to fifty. Now if you love the if you love the company, you want to get in and as early as possible. But I think you're going to start seeing a dynamic wear in the same way that last year, everyone earlier and earlier, you're going to see VC start to sit back and go a little .

later and later prove IT to us ah a dead man's zone.

Nobody should be putting money into deals right now. What is that? Why what what did you do unless unless you're the business unless you're in the business of running a fee generating machine, if you're really trying to generate alpha, you have to have a sense of what's actually happening in the world right now.

If you're just trying to deliver the market beta and run an index, then yeah, you're right. You should ignore this idea that there could be more Price adjustments. But if you look at the public markets, which is again, the ultimate terminal buyer, they have more cash than they ever had since two thousand eight, which means that there is no reason to buy you. Just like private .

companies IT .

all ultimately ends up in the public markets. And so if the public markets are saying there is no reason to buy this stuff, IT trickles down. So then the cross over investor who has a public private business says, you know what?

On the public side, i'm completely devise and in cash. And so on the private side, i'll just be a little bit more circumspect and weight. As David said, i'll just wait six months and put even more money in later.

I'll actually have a Better I, R, R, and i'll make the same profit dollars. So then the series b and c firm who used to feed those deals to the cross over folks are like, oh, well, if you're waiting, I don't want to have to write a check to support these folks. My whole point was to have you mark up the deal.

So if I could raise a new fun, they slow down. And then that goes back to the C. S, A person who's like, well, wait a minute.

You know, the reason I paid IT at fifty pre was because I thought you step in and buy IT at one hundred and then they slow down. So all i'm saying is I think that we are at the point of the cycle where constipation is setting in. And this is why you're seeing such a downtown king deal. Velocity and and dollars put to work.

This is, uh, great advice. I want everybody. I am going to take the opposite advice, and i'm going to do twice as many deals in the seeds stage as everybody else. But I encourage every venture, capitals and seed fund to take trios advice. I'm doing the opposite because of five percent company.

This is an advice. This is the market observation.

Okay, market observation. I I hope everybody takes that as the truth because what i'm seeing is the founders who are raising and who have real businesses are so sharp right now and so focused on costs and profits and what matters, and they have eliminated others. Ship that doesn't. There's a whole contingent out if you're seeing a sex. I say it's one out of five, one out of four that are like I understand what's happening here and i'm going to take advantage of this moment of time and i'm gonna drive revenue and profit.

What happens to the two hundred and fifty billion dollars has been put to work in the last two years. I need to get up.

Yeah, doesn't matter to me. All I care about is meeting Young companies that are grown with revenue. But I think position yes, 就是 that's a lot of injection。 Yeah they going to have to cut their staff by and get to profitability.

Ultimately, the way that valuations matter or Price levels matter is there's an entry Price in exit Price. And ideally, if you can time and right, you want to invest when valuation levels are low and you want to except when evaluation level are high. If you were a VC last year, you should been realizing as much as you can because valuation was really high. There was a good uh tweet by one of uh breakfast or colleagues and altimeter basically saying he was talking to lp s and asking what they care about and what he reported L P S is saying is that if you're a fun that's more than five years old and you didn't distribute during the best window ever, which was two thousand and eighteen and two thousand twenty one, it's a hard no, you know, we're not going to be reopened with you.

I'll say IT even more if you if your adventure investor who took a latitude no view on public market stocks and then have now seen sixty to seventy percent right downs of those same stocks that you could have distributed, you should still have something to answer to. That may no sense. IT turns out that the skill of private market investing and the skill of public market investing are different. Even if all you're doing is delivering the market beta, it's still different. And remember.

I was I distribute the shares of ro. And in terms of secondary, you feel like a genius now because you're L P, should say thank you, Jason, that what I feel smart about biomedical, we had the legally on making a number four to five times. We were offered the opportunity to trim our positions in secondary with our winners.

Uh, from people who wanted to buy secondary shirts. I did IT probably four or to five times and i'm just picking myself out into at the fifth or I didn't ask if they would take more because, my god, we were able to clear some positions at very high valuations that are now lower them that in the private markets and send cash to our L, P. S. And get our, you know, get off our hurdles in our first two funds, which I feel smart about.

I think that you should feel so, so good about that that that is really hard what you did. And I think people underestimate how much IT is. IT is really hard to actually return more money than .

you have taken in. Yeah, I mean.

that's what that simple statement. And and by the way, I was hard in the last ten years where we've had basically a massive up market in the four of us Frankly benefit from the extraordinary luck of being a tech. Yeah, no, it's super, Lucy.

I think the big thing that's gonna happen right now, seeing IT all over the place is M N. A, I think, is going to start picking up. Just today, amazon acquired one medical for three point nine billion, one medical and org clinics.

if you don't know, three point nine billion dolente prise value for one hundred and eighty two franchise, which is twenty one years franchise. No, I went from the in the peak in february of one, two, a seven .

in eight in the right to know.

My point is you could buy a mcDonald franchise for two million, or you could buy the company that fixes the people that needed mcDonald for.

That's why they, by the way, of mcDonald d, you can't make money selling pharmaceutical up, selling, you know, other stuff that amazon is going to.

I think it's super interesting that. I think it's super interesting that amazon is getting into this business.

wow. I mean, that is really, really clearly have a an economic model that shows some significant well there. yeah. And there may also be of a supplement pharmaceutical kind of a great opportunity cynically in this business .

and think about you. But I think .

what they are getting also not just the physical locations, but the network of doctors that can do tell a health, I don't know if you guys i've never used one medical, but they do really um easy zoom, tell a health services and so you could hop on, get a proscription, have a fulfilled by amazon and shoots up at your doorstep. Under hour IT will be an incredible energy for that business and probably a real value driver, not just at the core units. But what about the other things they .

are going to be your one medical doctor will provision a blood test here. SHE will analyze those blood test over a telehealth. They will prescribe a Better diet that will be sent to whole foods. Who will? Then I started.

i'm serious. And then amazon IT makes so much .

sense for amazon to expand to build out retail footprints because that business model now gets more and more complete by the day where you become so ingrained and in mashed in this year.

this is but this is really about at the end of the day, is the description business. Amazon prime is the driver of amazon's business, yet another amazon prime lock in. So your I know IT is silly.

but two days little about your subscription. But I think you got I bet you guys a dollar within a year after closing the deal, they're gonna massively expand the hel footprint of what medical is doing because one medical had to go out and do customer acquisition to go to acquire customers to make money doing telehealth services. And they're spending a thousand dollars, probably cpa, to acquire these customers maison's to do this. Why did google do this on amazon's already got the customers, by the way, things know .

doesn't how to do messy things in the fiscal world. They not to do service. I mean, amazon .

been working .

warehouse .

for products .

and N.

Yeah, real words of the other thing is really interesting about this amazon deal is that IT was done with bezos, not at the home.

And I think IT really, you know, begs the question and bags and answer around, are these guys going to continue to innovate like this? And I think right now, the jury saying, yes, they are going to continue to push the the cynical gies they can drive from this business by expanding IT to ancel services and in an industry. Uh and it's really impressive to see them doing this without um without dazles running the day to day as a shareholder. I feel that um so uh really great to see.

Yeah I mean this is where like they could buy jord dash, uber lift .

of the world foods. They're buying an asset that there be a tremendous leverage and energy out of very cheat. They are buying the company at the same Price IT was trading at a few months ago.

Yeah and they have a they're a great C E. O at one medical, is a friend of mine and your .

Robin and congrats.

Shut out body. See you with your big sex.

No, I never. I never went my beak in the deal.

Big syddall.

No, I would.

I from D, B.

I be taking up right now if I was in that company.

I'm shocked we haven't seen the J. K. Victory that he goes on some podcast tells bloomberg that vcs are going to get pinched for insider trading all these tokens.

And long behold, on the wall street journal, three guys, I guess, a guy at coin base, got pinch for basically insider trading, these token sales front, running IT by buying them in his wallet and stuff. And so but where is your Victory after. hello. Hello, want to take your Victory?

Well, no, I mean, I told everybody like if it's if IT smells like a security, people are buying IT for that reason for you to appreciate. Don't be surprised of the c you know starts having tips dropped on them that different VC firms in huz with law firms in huz with everybody were liquidating their positions. We talked about liquidating positions as being the goal of venture capital.

They created a shadow economy next to security law and said we're going to just start liquidating these things. But under what they made the rules up under which they could liquidate them. I'm not picking on a firm anybody will will see over time who gets penchant.

But you if you decide you're going to talk yourself into this is not a security even though we kind of feels like one that's on you, that's on you. As the person buying the tokens, issuing the tokens, giving the legal brief on the tokens, I think people suspended disbelief and talk themselves into thinking that they weren't trading security. And I think the sec, now that ever reads, lost their money, is gonna tick off one firm after another.

And it's going to be massive settlements. It's going to be three, four years of litigation. So that a Victory that is just IT was such an obvious observation we all saw out.

I mean, how do you liquidate up your shares in a company that has no product in the world? Like, come on, come on. People knew what they were doing.

If they get the book thrown out, they deserve IT aren't everybody. And this been another amazing episode, even though sex is going to is the worst. I like IT, I do.

That's a lake. Is that real? That's lake front.

Is that a zoom background? Can I get that? The zoom back?

Take your .

photo so .

we can all use IT. I .

love you were back .

to rain, man. give.

We open sources to the fans and .

got crazy with.

We should all just get a room, just have one big, huge or because like sexual attention. 没想到 吧？ Good.

我 一定 是 get。

东里 东。