E143: Nvidia smashes earnings, Arm walks the plank, M&A market, Vivek dominates GOP debate & more

27:24And so these are all these things where the software has become more and more sophisticated and actually be able to path and tunnel code into different ways of getting it executed and then bringing it back and such and get together. All of these things don't exist. Those are very rudimentary things that were solved in V1 of compute. So I think that to your point, David, like we don't know where this goes, we're probably going to go to a place that is not just about chips, but it's about systems. but that's going to create this weird Balkanization almost and I think that's where a lot of the profit margins will get a rotor to weigh because that will make it a much more competitive industry and there just isn't a lot of margin to capture when you actually stitch all these things together.

28:09Yeah and if you think about what were the massive wins for all that extra fiber it was really two companies the first was YouTube which which stop charging people for transport on their videos before that. If you had a video go viral, your server got shut down because you hit your $5 ,000 a month limit or whatever you had set with your ISP. And then Netflix, of course, right? Netflix couldn't exist. And all that dark fiber built that. So we'll see with all this extra GPU, what could happen. Until your point about the breakthrough is there, you can now go into your chat GPT. And you could put in custom instructions.

28:45And so it asks you, what would you like Chatship to know about you and provide better responses? And, you know, for example, I told it, I'm a venture capitalist, I live in the Bay area, I'm looking for concise business information, and then it says, well, how would you like, how would you like Chatship to respond? And I said, I like to see data in a table, I like to see data in those tables with hyperlinks, I like citations when possible. Yeah, just to be clear, what you're describing with custom instructions, that was a feature which I think they launched like a month or two ago. And what that is doing is prompt engineering, basically.

29:18It's pre -saving like all that preamble that you would have to put in every single one of your prompts, whereas this fine tuning, as I understand it, is more about fine tuning the model to improve the model for a certain kind of need or certain kind of output. Right, so the example there would be if you had your email box or you had your Google docs or you had a repository of all your Slack messages or something in your company, How do you corrupt company handbooks or you know all of a Chimaxe of Latter -Sea rights every year? You could have that uploaded to chat GPT. It's potentially very powerful I think for enterprises.

29:50I think the big enterprise use case the most obvious one is that every enterprise wants its own Internal chatbot it wants its own internal chat GPT where the employees can ask questions and The AI has access to all of the company's information and it understands permissions and privacy So it only reveals information to people who have the right to see it. That's kind of a tall order, but I think that's what the market wants. They want the chat GPT for the company intranet. Yes. And so I think there's a lot of people racing to provide that. And there was an interesting tweet by Nathan Benaych. Anyway, he just said bye -bye a bunch of startups.

30:26Because I guess a lot of stars were working on this fine -tuning problem. That may be too glib or reaction. Yeah, it's a reaction. Because I think there's just a lot of enterprises who do not want to share all their corporate information with OpenAI. Of course, what if it's HR information, then you have people asking like who are the most overpaid people in this company? You know, what if it's like the badge information and how many hours people are working or that's more about permissions Jason But even if open a I can nail the permissions problem I think there's a lot of enterprises who will not want to trust their data to open AI Yeah, they're gonna be afraid about where it goes This is why I think open source is taking off in a big way is that I think big enterprises would much rather roll their own models And control it and do the fine tuning and that's why they're using tools like mosaic and hugging faces, they want to have control over it themselves.

31:09That's an excellent point and that has implications as well into the hardware, which is also probably a good jumping off point for arm because what you said is exactly must happen for the integrity of an organization to want to use these things. And if that happens, then I just further, further accelerates, I think, how the hardware will get abstracted and frankly, quasi -open source as well. All right, let's talk. Facebook did a great job of this because like when Facebook was building data centers, they had to invent tremendous capabilities that didn't exist before. And the market was really fragmented, it was very expensive, and what they did was they basically created these reference designs for servers and blades in the whole nine yards and open source the whole thing.

31:51And it just, you know, in essence, destroyed a market, but it created a hyper -efficient market that then everybody could use. And I think the question is that if it's happening at the software layer already now, just Just like it did in Web2 software, and then we see certain elements of Web2 hardware have been open sourced. I think it makes pretty logical sense that you can expect the same things that happen in the AI world. The AI models and the AI platforms and all of that stuff will first get open sourced because it's a data integrity security issue. And then the hardware will get open sourced as well because you just want simple reference designs you can use and plug and play.

32:30Yeah, if you want to look at that, it's called the OpenCompute project, OpenCompute .org. Just a way to use open source to grind down the prices, take out the margin, I guess is what you're saying, Chema. To make all these data centers scale, right? Right? Yeah, so one related story here is this just happened in the last few weeks. There's a company called CoreWeef, which provides cloud infrastructure for AI training. it's secured a $2 .3 billion investment in the form of a loan. What we were trying to do, it's kind of like AWS, but for GPUs. So essentially instead of having to buy your own GPUs in order to set up your own infrastructure, you just basically rent compute from these guys.

33:16But this is exactly why none of these companies will really be allowed to exist in this exactly four or five years from now because ultimately, well, people want as massive throughput, right? Tokens per second. Give me as many tokens per second as possible. And they don't particularly care. Again, if you understand the model, do they really care what the underlying substrate hardware should be? It doesn't seem like they should. They should care what is the throughput. What do I pay for it? And by the way, that is exactly what happened when AWS really start to scale because if you guys remember, when we started for subtract code in AWS, what do we care about?

33:49How much an EC2 instance cost, how much did an S3 bucket cost, and that's all we cared about. Because that abstraction allowed us to not care about the underlying hardware, who was the vendor, what was the kind of configuration, it didn't matter. And so in an interesting way, we're going to go through that same evolution here because it's just economically rational that that kind of market exists. You should only care tokens per second, I think. All right, in other news, oh, in by the way, there's something called Common Crawl, which is another interesting open source project, but it's getting a lot more attention today because they have crawled the web and you can use this common crawl they release it monthly and that's what a lot of people are training their data on now.

34:29They don't have permission from all those people to do training data, but they do have the ability for you to download an open crawl essentially what Google has and you have an open source version of it. So, Common Crawl was started and funded by Gil Eldaz. Yeah, he's a friend and Gil sold his company applied semantics to Google back in 0203 and a big part of his effort with a common crawl is to. That's not exactly. Is it not sense? It was not sense. AdSense. So basically applied semantics could read a webpage and then create the keywords associated with the content on that webpage. And then those keywords would trigger adwords ads on the webpage.

35:14So they called it AdSense. So AdSense started and the whole publisher network at Google was born from the applied semantics acquisition. And Gill was obviously a pretty significant shareholder of Google. He's even in the S1 as one of the major shareholders. He's a really great human being. And his intention with this Common Crawl project was to make the crawling of the web, the index and the caching available for all these different projects that might exist. and he didn't at the time anticipate the open AI application becoming the big breakthrough. But when GPT -3 was published, I think they said that 80 plus percent of the weighting came from the content out of Common Crawl.

35:57And so it's really been this amazing project, completely non -profit, mostly funded by GIL, and has really unlocked this opportunity for a lot of the open source alternatives to and now try and provide solutions that can exist and coexist with OpenAI and others in the commercial options in the world. Small piece of trivia. We were one of the first AdSense publishers. And so here's a story from October of 2005, Weblog's Inc, which didn't gadget, the blogging company I started, hit $3 ,000 a day in AdSense, thanks to Gell and the team over there, and we wound up selling a tail -on. That's awesome.

36:34And this is the story about it. And we were included in the S1, They had two examples of publishers. One was New York Times and then one was Weblogs in they Want to show like an upstart and this one and so a lot of history here and it's fun to go back Down to and we were in the S1 for by the way, Google. He always gonna be at the summit So you go to the summit. Oh, I'm gonna give him a hug and take a picture Charles Barkley had this great story, which is like he It's like over the moon about being a grandfather. I saw this on 60 minutes and he said it's because I want my a grandchild, grandson to Google me, and notice that I did some things, and then we can talk about it.

37:12Yeah. And Jacob, I had this thought for you. That's a cool piece of internet history that you're a part of. Hopefully your grandkids will Google that, and you can tell them that's pretty cool. Or, you know, 1800 episodes of this weekend's start -ups. I just tweeted an episode with Gary Tan from 2009 that I recorded at Sequoia's office, and I just put it on the, this week in startups, Twitter accounts, pretty funny to have babyface Gary Tan from Post -Rus on there. All right, ARM officially filed its F1. It's kind of like an S1 for a foreign company and they plan to go public next month. ARM's revenue last quarter, $675 million, down 2 % year -over -year, up 7 % quarter -over -quarter, fiscal full year, 2023, 2 .7 billion -ish, down 1 % year -over -year.

37:57Farms major business, just so you know, is smartphones, 99 % of smartphones are built with arms, chip architecture. Inbedded systems. They have a manned system of business systems. Yeah, we'll get into it. The problem is the market is totally moving. When SoftBank bought arm, it was probably like the last year where, you know, there was so much focus on the hardware and platform technologies inside of mobile and tablets and all that stuff. But in these last few years think of what's happened. We've had a massive shift to AI, right? And so that's pushing a lot more pressure on GPUs and whatever comes after that.

38:32We have had a reemergence of the popularity of risk v, which is an open source competitor to ARM. We have had Apple in source a whole bunch of their own architectural decisions and silicon design because they don't want the dependency. They want the proper philosophy. Yeah. Well, also they also care about different things like they care about battery life. So that's where I think that's the focus of their chip architecture. And so all of this just means that that market embedded systems becomes more and more constrained and commoditized over time, which again, as we said, in capitalism means that future profits will be less than historical profits.

39:09And so I think this is a very tough valuation to get right and trying to stretch to a 60 or $70 billion print, I think is really tough. This is a, honestly, a $15 to $20 billion company. So question for you, I took them off and I'll open it up to the David's. Why would Soft Bank, I know the answer, but I'm asking you, so you can explain to the audience, why would Soft Bank take a company public with these headwinds, with no growth being flat? Why are they taking the public now? Well, Softbank has the D -leather, right? They have a very big problem, which is that they have this forget Softbank vision fund for a second, but Softbank itself is a telco operator that has ginormous piles of debt that they've used to finance the building of their business.

40:01And so when you have contraction in your core business, you become more and more at risk of breaching the covenants of all that debt and or you just run out of recache flow, like like all of these things really hurt your future ability to invest. And so soft bank is under a lot of pressure to just clean up the balance sheet and de -lever. And so when you have an asset like this sitting there, if you can sell, you know, 20 or 30 billion dollars of that, call it to somebody and then replenish your balance sheet that provides tremendous liquidity and relief. And they did that as well a few months ago with Alibaba.

40:39they've started to, I think now they may have sold out the overwhelming majority of the position in Alibaba again because they have massive liquidity needs because they have so much debt. So this is just part and parcel of them delivering the balance sheet. So they're forced to get it out, is I guess what you're saying? And then we've talked sacks a little bit about other companies that are going to be forced. They're on the, what do they call it when you're on a pirate ship? They make you walk the plank. I'd say this is like the walking of the plank to an IPO. You've got other companies that have issues where they just have to get public at some point.

41:13So maybe the public markets are gonna open up. And in some cases, it's gonna be because people are walking the plank other cases it's gonna be opportunistic. So maybe you could talk a little bit about your thoughts on that. I think it's hard to walk the plank into the public markets. I'm not sure exactly what you mean by that because the public markets have to wanna buy your issuance. So if it's not a good company, than in this environment, they're not able to IPO. Well, they're going to be able to IPO. I think the question is the price. They have no choice but to get this out. So, yeah, there may be a lot of down -rounds into an IPO from the last private round, which was two or three times what the IPO price is going to be.

41:47Maybe what you mean by walk the plank is that, well, you tell me, but there are a lot of companies which have built up huge pref stacks because they raise too much money at the peak, at valuations that are too high. And going public does allow you to reset your whole press stack because all the preferred with all the rights and preferences converts to common. So post IPO, you just have common. And so it is a way to like clear out all the structure and all the mess that has built up in a company and you can get to a real valuation that reflects basically the truth of what the company is worth. Another analogy maybe the house is on fire, you're on the balcony, you got a jump, or you got to stay in the burning building.

42:27Yeah, but listen, if your company is on fire, I don't think you're going to be able to IPO. I mean, it's going to be a tough, scrutinizing public market for new offerings. I think that the scenario in which you can IPO is if the company is fundamentally good, it will be able to IPO at some valuation, and that valuation may be a significant down -round from their last private round. Those will be able to get out. Yeah, and that's right, I guess. Now, are you seeing— That can be right, Pio. Are you seeing David the M &A activity starting to bubble up in your portfolio or in the back channels because I'm starting to see that a bit founders are packing it in in some instances and saying you know what we want to try for M &A or some companies are getting a little bit frisky and saying hey what's available in the market on the small side so are you seeing any M &A action?

43:17Not a ton yet but there's definitely a growing number of startups who are realizing though what they're doing is not working and they're not commuting to raise another round. And so therefore figuring out a graceful exit, whether it's an aqua hire or some other type of landing. Oh, God, those are those might be the accurate walking the planks. Yes, those are the walking the planks. You're going to start seeing a lot more of that for sure. Freeberg your thoughts on the public markets here and in relation to privates and people walking the plank. I don't think there is a public market right now.

43:48There's no IPO window. This arm thing is It's pretty forced. It seems it's not like there's a kind of pent up public demand to buy these arm shares. At least that's what it seems. So they're going to go shop it. They're going to find out what the market tells them it's worth. And then we'll see. In video, it's going to help buoyate. I'm sure there'll be an argument that all boats will rise and our money will be of beneficiary. But I don't know if that necessarily leads into the IPO window being open again. And I think we've all heard the commentary for Morgan Stanley that they don't think the windows opening until Q2, Q3 of next year maybe I can't remember the exact commentary But as we all know a lot of LPs in venture funds and private equity funds are waiting for The IPO window to reopen before they're going to start reallocating capital back into the private venture funds because they need to get liquid in order to be able to recycle capital back into the next class of funds.

44:51So this glut right now, this inability to kind of get companies public is certainly weighing on folks. You effectively have three options when you're running a private company. You got to keep raising money, which means either raise private capital or go public. We've talked about the challenge of raising late -stage private capital if you've had a high at private valuation in your prior round. Going public is very difficult right now because a lot of folks are still digesting and having indigestion from the last couple of years. Or you got to sell the company or you got to get profitable. Now, on the sell the company side, many of the acquisitions that we're seeing with a few exceptions are generally more bolt on and less like, hey, I'm going to pay some big strategic premium for some big strategic game -changing company right now because all the buyers are dealing with their own shareholder issues and their own public stock issues right now.

45:40Then, can you get profitable? It's really, as you guys know, where a lot of folks are going, which is totally restructure your ambition, restructure your plans, and build a business where customers are willing to pay you money, and where you can then take that profit and only reinvest that profit and not invest more than that profit. If you can get to that steady state, you can live to see another day, another year, another decade. And those businesses, by the way, that we saw on the dot -com boom in the global financial crisis that were able to do that during the doldrum death valley march that everyone's going through right now, they emerged victorious.

46:18They learned how to be frugal. They learned how to be nimble. They learned how to really focus on customer experience because they had to increase retention and they had to increase the prices they were charging. They learned how to be efficient with allocating resources. And so profitability became a core part of their DNA and their ability to succeed. So I think this is really a trial era. And on the other side of this trial era, a number of very high quality companies will emerge. But in the interim, I don't think that there's an IPO patch that a lot of folks can just check the box and say, hey, let's go ahead and go public even if the valuation is not great.

46:53Remember an IPO process, you got to over sell your book or the bankers won't underwrite it. So if they're you know, you can't just say hey the price is now five bucks and expect anchors are there If a company's burning money the big concern with going public right now is that there is no pipe market There is no ability to do secondary to do follow -on offerings So the company can't raise capital after its public So unless you're actually profitable your option of going public right now really isn't there because shareholders don't want to buy shares in a company That may run out of money. Yeah, and that would end up Yeah.

47:25And to your point, if you take this third option and you become really resilient and you have profits, Jamoth, that seems to me to be the setup for the next boom that we could experience in the coming years, hopefully, which is we don't have companies that are burning mountains of cash. People are getting to profitable. These businesses look great. And then if the big companies are now having their stock prices recover and they've laid off 20 ,000 employees and they got people returning to the office and they're fit and they're strong. Hey, that's a setup for strong companies buying strong companies or those strong companies that are private.

48:00The M &A market is dead as a doornale. It's more dead than the IPO market. So two days ago, the European Commission and the CMA in the UK said that they're probing Adobe Figma because they have some concerns that it's going to limit competition in the market. It looks like Microsoft will have to give a 15 year license to video game streaming to Ubisoft in order to get the UK folks to agree to their acquisition. So you're talking about, in the first case, a $20 billion merger that may not happen, because the CMA, they found their footing. They clearly had a win in the Microsoft Activision thing, and now they're probably going to find issue with the Adobe Figma thing, and the Europeans don't want to be left out in the actions that they're jumping in.

48:50So I think the M &A market is effectively dead. What it leaves is an IPO market, but that is very tenuous because you don't have a leading candidate that can really catalyze something. And I made this prediction earlier, but I think the only company that can really catalyze things would be if people were ready to do sterling. I mean, it's the most obvious natural logical thing that would just get everybody excited and off the sidelines and into the arena. But that may take another year, may not, but it may. In the meantime, I don't think there's any company like Instacart. I don't think people are going to be jumping off the sidelines or it'll be tough.

49:29Even straight now is like a very complicated valuation trade. And I think that that's a really technical thing to be involved in an IPO like that. A technical valuation. And so companies have no choice except to get profitable and get to default alive to use the same as Paul Graham quote. Dear, that's the only path. That's it. Yeah, I mean, suck it out only. Path. You either have to be default alive, which means profitable or default investible, which means that you're capable of producing metrics that a VC will fund. But really, that starts with 100 % your over your growth. There's a lot of companies that aren't growing very fast or growing 20, 30, 40, 50, 60 % growth.

50:09That's not VC -Fundable. Or they're flat, even worse, some are shrinking. So those cases, they got to think more like a PE model than a venture model. And PE companies are cash -repositive. They don't burn cash. I put out this video a few months ago called VC or PE. What's the right framework for thinking about your startup? This was a... Oh, CREF Ventures. This was a talk that I gave to our portfolio companies. We recorded it and then published it. Really, it should have gotten more attention. But this was basically recommending to all those slower growing companies, our portfolios, stop thinking that VC funding is always me available and start thinking more like a PE funded, private equity company, which is to say you need to cut your burn to get cash repositive.

50:59You will then be able to control your own destiny. So yeah, the slide here, if you're not VC eligible, act realistically. So we provided some guidance on what makes a company eligible for VC funding and you can see there's a good column There's a great column good starts at 2x growth. Great is 3x gross margins good starts at 50 % great is 80 % Now dollar attention good starts at 100 % great 120 % Cack payback good is 12 to 18 months great is 6 to 12 months burn multiple good is One and a half great is one or less and then there's some dangerous zones as well Well, this was to provide them with some realistic guidance in terms of whether they'll be able to raise another VC round or not.

51:42And I can tell you, like, most startups in start world right now are in the danger zone. It's a really tough environment. And so, you know, listen, if you're a startup with sub one million of ARR and you're in the danger zone, you're probably going to have to pack it in, or maybe you package yourself up for an aqua higher. but if you're a startup that has 50 million of ARR, but you're in the danger zone, just cut your burn. You could basically make your own cash repositive and you could engineer an outcome for yourself, a pretty good outcome. My anecdotal experience is one of our larger investments we brought in a private equity firm where they came in.

52:21And my God, it's been an incredible experience because the combination of how like a VC looks at a business and how a PE firm looks at a business in a moment like this is hyper additive because it's super clarifying. It's very straightforward and it gives a CEO an extremely clear mandate from which to operate and then they become very measurable and I found it to be a really, really healthy thing. Now, PE guys can only get in, falls in companies of a certain size, so it limits 50 million and above in revenue, 100 million. Yeah, in our case, it was a 400 million, 388, more than 300 million revenue.

52:59So it's a big company, but my point is, it's just more that we were moving along a trajectory to getting to default alive, but by adding that PE, to support, boom, I think we were able to focus on it, probably a year to 18 months faster and with specific precision because they have a very different toolkit and a reaction to misexecution and that's extremely healthy. Yeah, we had this happen. Meeting with just from the front lines, we meet with, we have 20 ,000 people apply for funding from our firm. In large part, I would say we doubled the number of applications after all it started. So shout out to my besties here, it's really helped our deal flow.

53:43And we find companies and we found a company that was obsessed with all in and the two founders were quants and they made this company called Stone Algo. We meet this company. They've got very little money. It's a bootstrap company and they got to a half million dollars in revenue, you know, just on sweat equity. And we find this company. It's not part of the Silicon Valley, you know, accelerator system. It's basically kayak for diamonds, shout out to the team over there. And we were able to place a nice bet on this company that was break even and you know put in a couple of hundred thousand dollars to start them down this road to growing faster but what a delightful thing to find a profitable company in the world and so if you have a profitable company like and it's just 50 ,000 a month or 25 ,000 a month please email me, jasonnakeleganis .com, I want to invest in your company.

54:33When you have that company small amount of revenue profitable and you're not burning a ton you are so attractive to investors right now. It's the highest attractiveness in the world. And I just want to point out, David, as this market has, you know, completely gone from absolute chaos. The hair has gotten tighter and tighter. You were in crazy ban and now you are tight tight. It is right. Sacks is focused. He's deploying that LP capital. He's deploying that advice to SaaS companies. And it's no joke now, folks. General sacks is here. He is not crazy. History uncle. He is sacks sacks is back. This is like when Mark Zuckerberg started wearing a tie to work to start showing that it was serious.

55:21Yes. Yes. Sacks is sacks is serious sacks is back without slick back hair. All right, listen, we got to get going here. We got a lot more on the docket. I think we just maybe I'm going to to jump the fence here, and we just go right to the Republican primary. The funniest thing last night was at poker. We watched it. You watched it during poker. Were you able to focus? You have to hear Kevin Hart react when all these guys are doing it. It's one of the funniest things I've ever heard. And the worst part of the poker was... Oh, the magician. Here we go. I'm like, how can you both be playing poker here, but also the debate stage at this time?

56:08Which I thought was a really funny joke. It's a murder racist. It was funny. It was very funny. All right, listen, I know everybody's, I just want to go around the horn here. Friedberg, did you watch the debate? Who won the debate? who had the largest game, net game, in terms of their profile in your mind after watching debate number one of the GOP. David Friedberg. Biggest game. I watch the debate. I kind of think about these guys on three dimensions, which is the content, how dynamic they are and their personality. I think those are the three dimensions that people are going to be kind of assessing them on.

56:49I think Nikki Haley did a tremendous job gaining interest with respect to her personality and her content. Berga Huchinson, I don't think had a chance to move the needle on any of them. I think Vivek was by far the winner on dynamic. He had the hardest hitting, biggest comeback with a very close second being Chris Christie. But I do think that Vivek got taken apart when it comes to content and I have a real concerns about his personality. There's a lot of people that are just turned off by him that he seems a little too eager, that he seems a little too smart for his own good. The commentary about him being so junior and doesn't have experience.

57:37I think standing next to those guys on stage really showed to be honest. just Nikki Haley tearing him apart on his point of view on Russia and sex. We can debate the point or not, but I think she did a masterful. I don't think she tore him apart. I think that biggest dunk line of the evening was when he congratulated her on her future appointments to the boards of Raytheon and Lockheed. Yeah, that was brilliant. I just think he's the most dynamic character. And I think people do in a democracy vote on that. They vote on how dynamic someone is. They vote on their personality and whether they can trust the person that in Nikki Haley shines there She seems extremely trustworthy and personable Chris Chris came across is very personable.

58:20So your big winners. Yeah Mike Pence I would say Under underwhelmed and ronda santa's man. It's like he didn't show up So yeah, I would say Haley Chris frisky Vivek and Kim Scott are probably like you know across those dimensions like you know the four runners and everyone else is probably off. Now, let me get Chimoff and then Sac, you get to comment on both of there. So I want to go to you last because you have the most passion here. Chimoff, who are your big winners? Coming out of it. In other words, who gained the most last night? Welcome Brown, do for you. Welcome Brown, do for you. I think that...

58:57Okay, UPS settlement. Great. I thought that Nikki Haley did an incredible job. And I do think that the fact did a very good job. And I think what's interesting is that I'm fascinated to see what the Republican reaction over the next few weeks will be to Vivek. And specifically what I'm interested in seeing is, do the Trump loyalists start to, were they accepted with an idea yesterday, which is that this guy can give us a lot of the heartburn and agita that we don't want. And if he is able to thread that needle, which is what I think his effective strategy has been, he could really build momentum going into the fall.

59:51So that was my real takeaway is that he is refining a playbook. Look, the is a clearly a really brilliant person, well studied, well prepared, and dynamic, as David said, so he can, you know, clap back at people, which I think is important. But the most important thing that he's done is he has defined a very precise strategy to thread this needle of being close enough to Trump to frankly eventually go after him, but do it in a way where he's slowly building credibility among Trump loyalists. And I think if you look at where other people made huge gaps, unnecessary gaps, was they took their beliefs and they confused them with the strategy of winning.

1:00:45And that doesn't work in the Republican Party. So when And the candidates were asked about Trump and the ones that drew a hard line and said that this guy's going to go to jail. What happened? They got booed. And it just ended their ability to be credible for what they said afterwards. I'm not saying that that's right or wrong. It's just an observation. So I think the VEC is doing the smartest job of understanding the rules on the field. And he's in the arena doing it. Okay. So that gives him a lot. That gives him a lot of chance. Now we go to SAC. you heard Nikki Vivek Christy from Freeberg. Here's Vivek.

1:01:19And Tim Scott. So Vivek clearly, the buzz and the search terms and everything, it seems to be favoring Vivek as the big lift here. Do you think Vivek is the Trump change agent without the indictments, without the baggage, without the Trump derangement syndrome insanity? Is, is, is Tremoth correct here that he's a more palatable version of the change agent that is Trump? I think he's positioning himself as the backup plan to Trump. So he's not criticizing Trump. He is cultivating support within Trump's base. Again, not to supersede him, but I think to perhaps be a backup plan. I think it is a smart strategy.

1:01:58But let me back up a little bit here. Who won for you? Well, let me do it. Before you make your point, well, first of all, everybody else played the game. Biggest game. Clearly, the biggest game was for Vec. That's what reflected in the polling. There's a poll on drug report in which 33%, which was the highest number said that he won the debate. 22 % for Haley 18 % for DeSantis. Christi got 16 % the rest were his nonfactors. So scientific but pretty and so scientific but this is corroborated by Nate Silver had a yes, substock this morning basically saying that Based on the buzz on social media and the sentiment that he predicted and Google trends he predicted that Vivek would we keep saying Vivek Vivek it's it is he's gonna have the biggest bounce out of the debate partly that's a function of the fact that he was the least well known candidate.

1:02:53Okay. So this gave him a lot of exposure and he is a good orator. I mean, just the way he talks the energy, the timber of his voice, he projects well and he had a clear point of view in this debate. You may not agree with everything he said, but he had a very clear point of view. And I expect that both the number of people who like him and the number of people who dislike him will go up as a result of this. But I think that not affected that will be positive. Now, let me back up to give you a couple more thoughts on the debate. First of all, in terms of winners, I think the Republican Party in a way demonstrated that it is the party of ideas where there actually are debates happening.

1:03:30because you saw here I think real differences between the candidates and I could break them up into really three categories if you like. There's this Neocon wing of sort of hard line foreign policy hawks and you saw Dickey Haley's part of that in Chris Christie and Pence, Mentem Scott, then you had this religious right faction where you've got Pence and Scott and then you've kind of got the Mago wing which Vivek really took up the mantle of opposing Ukraine and defending Trump. So you have three very different groups within the party who are battling, I think, for mind share within the party and to be the future of the party.

1:04:10So it's not just about candidates and personal style, but it really is about ideas. You compare that to the Democratic party, they're not even having a debate. They're protecting Biden from a debate. There could be a real debate because the RFK Jr. has really different ideas. And he would like to take the party in a very different direction, the direction of his father and uncle Bobby Kennedy and John F. Kennedy. He's saying that we have moved away from where we should be as a party, but the people who control the Democratic Party do not want to have that debate. They have shut it down completely.

1:04:43There is no debate. They're just protecting Biden. So that's number one is I think we should give the Republican party some credit for building willing to discuss and debate ideas. I love the fact that you had a vibrant debate, you had differences of opinions. Now it was a little like a UFC fight and, you know, zingers and back and forth, but I did like the fact that you had people who in moderation was actually surprisingly good when they forced them to say, like, would you give Trump a pardon or, you know, what would you do in terms of support for Ukraine? This was like really well done and they had that 32nd thing where they stopped people, they said, hey, this is the 32nd one and they had to rain in because he kept interrupting and they were kind of respected by.

1:05:27So it's just want to shout out to Fox for good moderation. There were some crazy zingers in there as well. And it seems like we live in zinger culture. I think the best zinger goes to the moderator who said, let's talk about the elephant that's not in the room. And then they brought him Trump. Well, frankly, that's the best part. But that was pretty hardcore. Well, so let's talk about winner number two, which was Trump, because Trump did not participate and he didn't pay any price whatsoever for that. He barely got mentioned or attacked on that stage, and then he did this interview with Tucker, which started a fight and it's before the debate, which was kind of brilliant, because once again, Trump was able to suck up a lot of the oxygen, maybe not all of it, but a lot of oxygen without even participating in the debate.

1:06:08It was a perfect bookend. I watched both. It was a perfect bookend. You got Trump over here saying, Chimath, I'm interested in your position, but he said, listen, I don't need to be in there with these guys mudsling and they have zero or 1%. Well, and I think you got the sense that he's excited to debate them when there's two people left or something like that What did you think of did you watch Trump's thing freeberg or Chama? You're watching I watched the debate only I watch both the debate and then I watch I do think Trump effectively won the debate night Because you had all these guys going at each other and then you had Trump playing the Trump card I'm not even going to show up because I don't have to he literally made himself better than ever everyone else in the room by saying, I'm not even, it's not even worth my time to show up to talk to you guys.

1:06:53Go ahead and fight with each other. I'll also just restate this point about Vivek. I think it became abundantly clear that his strategy, Vivek, his strategy is to pander to the Trump audience that his commentary about, you know, God is real, climb your chains to the coast. There's two genders, he knows through polling through his understanding and his intelligence that this is what this audience that is the bulk of the voting members of the Republican Party want to hear and he is telling them what they want to hear. And then he is not the job of a politician. Yeah. I mean, isn't that better than pandering to the military industrial complex like Nikki Haley did?

1:07:35There was a comment last night that I thought was really important, which is that leadership is not about consensus. And what he he is doing is he is reflecting back the consensus view of the majority of people in that party in order to get himself elected rather than leading with a different message that casts a different opportunity, the different light on the opportunity for this nation. And I think that's really where he and others on that stage or he particularly fall short is that he speaks too much to what people already believe and say because he knows that that's what they're voting for Trump about.

1:08:04And then the bet is that there's some chance, not 100%, but some chance that Trump doesn't make it all the way, guns up in jail or people start to turn on him. And then he's the front runner because he's basically captivated that audience. Hold on. Hold on. But freeberg. And I will let you address it here. Shamath just said the brilliance of Vivek and his positioning here is that he understands how to win. And he is playing this game. And you call it pandering. Sax is, I think, saying it's understanding the needs of that audience. The job of a politician, sax, is to win and to stay in office. So I don't believe the vague positions on a lot of the stuff.

1:08:42I think he is pandering. I think he wouldn't do what Trump did I think you know he's he's doing the part in promise because he knows he gets him vote So how do you reconcile this your your job is to win right and you would rather see DeSantis maybe pick up on some of this action No As your preferred That's a good that's a good question. Freeberg. Do you think that the politisense job when you're running for president of the United States, is it to understand the conditions on the field and win or not? I think the politicians job, or I don't want to say the job, I think the opportunity to get elected in a democracy is to provide leadership, to cast a light on where you think the country or whatever constituency you're supposed to lead can go, to provide a sense of opportunity, to provide a sense of optimism, and to provide a sense of what's not happening today that should be different rather than reflecting back to those people exactly what they want.

1:09:40Now, the flip side of that is exactly what you're saying, Chimoff, which is that I think what happens in a democracy is that people elect people that represent what they believe. And I think that's what's going to happen. There's a lot of reason he's raising his hand and he's saying I believe these things and he's going to get elected or he's going to put himself in a position to get elected if Trump drops out. I just think there's a lot of people who are very smart who if they are too idealistic will achieve nothing in their lives and I don't think Vivek is one of those people. Idealism has a place in the world.

1:10:08It's not on the debate stage when you're running for prison units. Okay. Sax, you wanted to get in here. Go. Okay. Let's take the issue of Ukraine because that was one of the main issues that Vivek differed from the rest of the people on that stage. There is polling by CNN that a majority of Americans have now turned against the idea of giving more aid to Ukraine. I'm sure that number is much higher in the Republican party. If you remember, there was an event, Charlie Kirk, who is a conservative influencer, has an event called Turning Point USA. And they did polling of their conference in 10Ds.

1:10:41The number one issue that everyone agreed on was Ukraine, 95 % of the attendees opposed giving more aid to Ukraine. Donald Trump only got 85 % popularity. So the base of the party is even more united Against Joe Biden's policy in Ukraine than they are on loving Trump. Okay, that tells you something and yet The fake is the only can on that stage that was willing to raise his hand Like aggressively like full -throttedly not kind of a half -hearted to saying that he did not agree with Biden's policy on Ukraine What is wrong with all these other people on the stage that they cannot understand what is wrong with Biden's Ukraine policy, which by the way, is the signature policy of his presidency.

1:11:26What is the point of Republicans nominee candidate who's just going to agree with Joe Biden on providing eight Ukraine as much as it takes for as long as it takes? Is this your position here at Freeberg? Is that, you know, win at all costs? Let's call it the vague win at all costs, play the game on the field, let's schem out the saying and just win the game versus being principled because you did have a good idea i think that that framing is such a set up and can i can i just say something now you want you said playing the game on the field and freeberg said having a principle here and having like an actual vision for the country so i'm taking both of yours look i think the framing is not as not what is wrong with the vague but what is wrong with candidates like christie and pens and haley and scott where even though 95 % of their party is opposed to Ukraine, they are adopting Joe Biden's policy.

1:12:19And their only criticism of Joe Biden is that he's not doing enough fast enough for that. Okay, let's let Freeberg get in here. They're completely out of set. We got your point. What our Republican party is a stance today. We got your point. But is it not freeberg what you're saying is that there is this profile encouraged to invoke that book where you there's something that's unpopular that you have to do. And I think Nikki Haley, Pence, Christie, and the other ones who are pro defending in Ukraine from Russia, their profile encouraged Freeberg is that they will go against that 95 % polling and say it's the right thing to do.

1:12:52We should defend Taiwan, we should defend Israel, we should defend Ukraine against. Those are three different issues. I know it's three different issues, but they were all evoked by the VEK himself. So Freeberg, your chance. I think the West Wing does a great job of exploring both sides of this, which is when do you have to break the mold and break the expectation of the people to do the right principle thing. And when do you have to do the thing that you don't think is right, but it's what the people want to have happen? And I think that that's obviously a balance that needs to be struck when you're in this position of being an elected leader in a democracy.

1:13:28And so there's no real answer. I wish that there was like, I wish Mr. Beast had like a presidential process like you yet saw as a Olympics video that he did last week, where he brought people and he created just like, these like five things. I wish that we had something like that to elect president that it was more than just oration, because we elect the president today based on their oratory skills. They go on stage and who has the best quickie comment. The person who would be the most decisive under pressure doesn't necessarily win. The person who can inspire and attract and retain the best leadership, the person who can have the best foreign policy interactions with other leaders doesn't necessarily win.

1:14:08Those are skills that show up in other contexts. And when we put people on a stage and we say, okay, speak to the audience, the guy who speaks the best looks the best. It's not necessarily the guy who is best equipped to handle the challenge of the Bay of Pigs, or the decision on whether or not. I think you're being very distressed. I think you're being very distressed. You have the floor? Go. This is like, that's kind of like saying, why isn't it that it's the quarterback with the strongest arm that isn't the most successful? Why? Because that person is a fucking loser. And the person that's the winner is the one that can thread together a multifaceted set of skills to win the game.

1:14:49Tom Brady was drafted in the seventh round, not the first round. He wins the game because he has the requisite skills, which is a basket of things and a nuance of skills in different moments at different times. And so I think that you're being a little glib by saying the person isn't cool under pressure or this or that. It's not true. The people that win these races have a preternatial ability to be a complete egoist but not a narcissist. That is an incredibly deaf set of skills that a fair rare people have. It gives them this It's energy to be out there, talking to thousands and thousands and thousands and thousands of people, maybe saying the same thing thousands of times.

1:15:33But being able to stay focused, being able to be on point, having a sense of what they need to believe, know the details in a certain part, know the high level in another part, stay punchy, but stay affable, stay, that's the game. There are a set of skills that it takes to become president. You test the oration skills of a person when you put them on a debate stage. you don't test the other complex skills that it takes to be president. And getting people to understand the complexity of the role and all the other aspects of someone's personality are lacking in these fucking debates. But there are other, these other skills are in play in many things other than just the debate.

1:16:08Like the campaign is a highly sophisticated orchestration of running a small little government. Mario Cuomo famously said that you campaign in poetry and government pros. And there is a difference between campaigning skills and governing skills. There is a gap there. I would update it to say that you govern and pros and campaign and tweets. So the campaign definitely puts a huge emphasis on a candidate's communication skills. But that is not all just gloss or style. It also has to do with their policies and the nuances of their policies and how they handle pressure, how good they are under pressure and how good they are when they're attacked.

1:16:52So we put these candidates to a pressure cooker and kind of learn who they really are. I'm not sure it's a horrible process. So, Zach, let me ask you a question. Pence has been in the situation room dealing with a foreign adversary. Vivek has no military or defense experience. He has no foreign state experience. How do you assess Vivek in his ability to address those critical issues that he's going to have to lead us through versus someone who's been there and done that. And how do you know, give a great question, great question. Okay. Trust him. We trust the vague. Listen, Pence made that argument against a vague, apparently not realizing that the guy he was vice president for was in that exact same position in 2016.

1:17:29No previous political experience. Right. No experience being in the situation room. The only reason why Pence got to warm his ass on a chair in the situation room is because Donald Trump picked him to be his VP. he. But he was responsible for making any important decisions. He was basically clocking time as vice president. Give me a break. And that's why he's at what is it? One or one percent. No one gives a shit about Pence. That's what they said about Obama as well. Obama had zero experience. Obama barely could get elected before he became senator and then president in the matter of four years.

1:18:01And for Bush, what happened to Bush? They said that exact argument as well. And what do they do? They packed him with rums filled and chaining. How did that end? Yeah, I just want to also point out here that sometimes things get a little bit heated and when we get heated It's typically because we're we're triangulating around something very important I think what we're trying triangulating around here is that we are moving from an era of incumbents and Insiders to an era of outsiders if your point sacks post -Trump We now have the two or three most fascinating candidates are are people who do social media, who do podcasts, who do earned media, like we talked about I think two or three weeks ago is really good insight.

1:18:42And Vivek has mastered it. And he is exactly like Trump. And he's exactly like Obama to a certain extent in that those people were incredibly personable. They knew how to talk on podcast, they knew how to engage people. And I think that this spiciness that we're having here on the pod and the spiciness that you're seeing with some of those candidates is that we're moving from traditional media yet defining these candidates to direct to consumer, direct through Twitter slash acts, direct through podcasts, this podcast included, making people like RFK and Vivek, you know, very palatable people. And Ross Perot, I know I'm gonna get laughed up for bringing this up, who got 19 % of the vote, which is a serious number, he went direct as well.

1:19:26After he got that time. After he got it. No, he got 90 % Perot, because he actually went as an independent all the way. And what Ross Perot did was the equivalent of what Vivek and RFK are doing on Pakis. He bought television time. You don't know that or some people may want to spend, I understand who Ross Perot even is, but look it up. He bought television time and he went direct to the country with our budget. I thought this is going to be the future of politics. What we're witnessing right now is the transition from traditional media and the establishment and defining who the great candidates are, to the public and the people on podcasts and social media who are the tip of the spear and the Vanguard, they're gonna pick the winners.

1:20:08And I think this could be the tipping point election. Trump was the first Obama then Trump and now the fake and RFK. So I just like you all to maybe respond to that, especially you, Sacks, since you brought this media issue up two weeks ago. Let me partially agree with Freeberg in the sense. Look, obviously track record is important. and obviously the ability to be an executive, executive functioning is important for the chief executive of our country. So I'm not saying that we shouldn't look at that kind of record. And this is why, this is one of the reasons why I support DeSantis. I think he's been a brilliant governor.

1:20:43He's done a superb job in the state of Florida. He did the best job of all the governors during COVID. I think he did a better job than Trump did during COVID. So listen, I think those things are important where I disagree is just because Because Mike Pence has, again, warmed a chair in the situation room as vice president, to me, that's just not that relevant experience. I mean, the VP is kind of a nothing job unless something terrible happens to the president and they get tapped on the shoulder. So I just disagree with what is relevant experience. Second, I think it's important to recognize that the reason why the Vake has a lane here and the reason why Trump had a lane in 2016 is that the establishment wing of the party is so completely out of touch with what the base wants.

1:21:31Look, the reason why Trump came out of nowhere in 2016 is he basically turned everything on his head. He said, no more bushes, no more of these stupid forever wars in the Middle East. We need to build a wall, no more of this open border policy, and we need to reset our tribulation with China. us. Those were three mega issues that no one else in the party was talking about. And the mega issue today is Ukraine, 95 % of the bases against it. And they have left the fake this gigantic lane to exploit. Why? I don't know. I mean, they're trapped in legacy neocon thinking that the US police are the ones.

1:22:06Are they bought so sacks? Are he the ones saying they're going to collapse? I think that was a great moment. It's a combination of being trapped in legacy thinking where we have be the policeman of the world, combine with all the big donors in the party, many of whom are wrapped up with military industrial complex, want to contribute to that. If you were, can you just say it again, what you feel like I'm not hearing? No, I think that being president requires being better more than just an orator. And I think that the debates allow the best orator to show off their skills and capabilities on the debate stage.

1:22:36I was saying, I wish that there were other events. I would love to see some set of systems to expose the candidate's success or failings and how well equipped they are rather than the person who can just give the best interview. We all know this. When you interview a candidate, an engineer, the engineer that gives the best interview is not necessarily going to become the best engineer. You can look at their code to see if they're a great, great engineer. You can talk to people that report it to them to see if they're a great manager. You can learn more about their success and skills through more than just their oration on the stage.

1:23:08And yes, there's data in fact that we can pull from these people. I was just speculating in kind of a pseudo -silly way about the concept of, can we do more than just put people on a debate stage? How do you hire a CEO for your companies? So the board, what I'll tell you, you know? What I'll tell you, we don't do is we don't have the employees elect the CEO through a vote by having that CEO go in front of him. I don't know, but you're saying, I'm the best guy for the job. I heard you, but your vote is part of it. But you can interview, we do reference calls, right? We talked about their strategy and, you know, through the interview, through the reference calls, through looking at the performance of other businesses they've built and run.

1:23:45And, you know, and can you do that with that? That can have a full some understanding of his candidacy and his ability to be president. My point is, I think that there are certain things like with Trump that had not been tested or tried, that are going to come up in this role that they'd never done before in the past. And I'm not saying, look, by the way, I'm certainly not a big, you know, political career guys. You guys know, I think, you know, I hate that people build a career out of politics. I think it's the most inane, ridiculous thing. And if we could go back and rewrite the Constitution, that's probably the first thing I put in there.

1:24:14The thing with this line of thinking, and maybe this is where I reacted. So I apologize if I personalize it, is that it creates the risk of exactly what you just said, and this, what you just said right now, which is this blob class of people that use those arguments as the reason why change can't happen. Yeah. Why it might be, I don't disagree with that. I don't disagree with that. And I think that is the huge red flag about this line of argumentation around why out of the box candidates can't be evaluated by reasonably smart people of which there are 300 million of us in America that have the ability to see it.

1:24:50And so I actually don't think it's as hard of a job as we make it out to be and that when you get 180, 190 million different people voting, I do think you actually get a pretty good wisdom of the crowds and take away Trump's UI for a second What Sachs just said is so profound because like what Trump nailed was three ginormous lanes that turned out now we can all agree with None of us wanted these wars. Everybody basically believes that the border needed to be closed. And everybody believes that China has taken advantage in a way that has really hauled it out the middle class in America. Those were three totems that nobody would have touched.

1:25:34And if we had allowed this whole thing of like, oh, Trump doesn't have this, Trump doesn't have that. He just gives cute nicknames to his average series. we would have missed that he actually had enough executive function to nail the three biggest themes of our current lifetime. Okay. I think that's fair. I guess my commentary can just be reduced down to the debate stage and saying who won and who should be is different than who should be president Okay, so Sarah Lee I think looking at the broader context of Don's good job. Good job. The presidential but the presidential candidacy is much more than just as the base.

1:26:07Okay. There's a lot of other things going on If we're judging people just based on how well they talk and how quick on their feet They are. Chris Christie is a great talker. Okay. He's a media train talker. But guess what? He got booed. That was the low point of the debate. The don't point of the debate for me was that he I thought took a kind of like a low key racist job at Vivek when he was like, let me read it. He was a first person. Yeah. The last person in one of these debates who stood in the middle of the stage and said, what's a skinny guy with an odd last name doing up here was Barack Obama and I'm afraid we're dealing with the same type of amateur standing on the stage tonight.

1:26:42You fell was a little... No, not that. It's when you thought the VEK like chat GPT. Oh, okay. Essentially not so ready of a guy who sounds like chat GPT standing up. He was like this Indian tech worker and I thought, Hey man, that's... That's what you read into it? That's interesting. I thought he was just saying he sounded... As a salvation tech worker. That's true. That's what I had to read. I read that he was very like robotic and formulic or something. But what did you read it as the palace white guy on the panel there is something almost personal about the way that both christie and pants seem to react to a big it was almost like who are you you young whipper snapper to be on the stage with me especially pants i've been the vice president who are you you know i don't know what is missing here's what is quotes dismissive and i think there was a resentment that even before this debate the vape was rising in the polls and those guys were going nowhere let me explain it to the man and again it's not just or a torrental skill it's the substance of the issues and where he's willing to go that these other candidates are not.

1:27:44Here are the quotes you respond to. Let me explain it to you, Vivek. I'll go slower this time. Now is not the time for on the job training and we don't need to bring in a rookie. All of this dismissive stuff from Pence to Vivek got some applause because, you know, conflict and confrontation gets applause by these lunatics in the audience who, like it was like a - You also get an allocation of seats for your own team. So yeah, so it was the only reason why Pence was VP is because a rookie got elected president. Yeah, that's a very good. It's a good insight Yeah, that was very weird I thought the thing that was very interesting was not to make it all about Trump But he was the quote unquote elephant that was not in the room was the un Dying support for Pence who had everybody say Pence did the right thing on January 6th What would you take away from that sex because there was some there was a mix of booze and and cheers for Christy when he kind of said like we need somebody who doesn't behave this way.

1:28:39It's unbecoming of the presidency referring to Trump. So what was your take on is the Republican party in this audience trying to move past Trump given all these indictments. I'm going to leave the Trump Stockholm Syndrome and Trump derangement syndrome out of this just objectively. Yeah. What did you think of that? I thought Dessantis had the best response, which is listen, if we spend our time re -illitigating January 6th and looking in the rearview mirror, we're going to lose the Joe Biden. This is exactly the conversation and the debate that Democrats want us to be having. I think that's just factually true.

1:29:13That if the Republican Party spends this time debating January 6th, that's playing into Biden's hands. So you don't think Trump can necessarily be Biden that these other candidates have a better chance of beating Biden? Is that what you want to believe? No, I'm asking. It's a question. No, I'm asking. It's a question. Okay. January 6 is not only is it a waste of time, it's just a loser for Republicans. And by the way, it's Trump's worst quality to keep marketing back to the last election. Even I think his fans and supporters don't want to hear that. Who has a better chance of winning? Some pairing of these candidates, Sachs, or Trump in one of these candidates versus Biden.

1:29:50Heads up, you know, does something like DeSantis Vivak or Hallyen Vivak, you know, pick pick your combination here have a better chance versus Biden than Trump plus one of these. I think it's tough to say, but I do think that Trump has really high negatives. And in order for him to win the presidency, he's got to flip something like two or three out of five states, like swing states that voted against him last time. And I do think that this is one of the stronger arguments that DeSantis makes is that, you know I could deliver those states, whereas Trump may not. So I think there is an electability argument for the Sanctus.

1:30:33Okay. And so Friedberg hearing all the other way, I'm not saying that that's what's going to happen, but I do think we know that Trump does have very high negatives. And yeah, he's going to flip some states that he's going to have a lot of Democrats and women come out to vote against him. He super charges the base in the way Hillary charged the other way. Because they're one other thing about, of course, to say it's just performance in that debate. So I know that he doesn't stand out in the way that, you know, Vivek or some of these other candidates do because he didn't deliver any zingers. And also he wasn't the brunt of attack.

1:31:07I think we all thought that maybe there'd be a lot more incoming for him and the incoming really went for Vivek. But I think that he had a strategy in that debate. This is my interpretation. It's not based on any insight or knowledge or anything like that. But which was the way he answered questions was, I think to be broadly acceptable to all the different factions in the GOP. So like I mentioned, there's kind of the MAGA faction, there's the NEO Con faction, and there's the religious right faction. And his answers may not have been the ones that were most loved by any of those factions, but I also think that none of his answers disqualified himself with any of those factions, Which is kind of hard to do given how much they're at each other's throws.

1:31:50So, Saks, if this was a poker tournament and this was the final table, would you say the strategy for DeSantis was, hey, listen, I'm going to let these other guys shoot it out. I'm just going to sit on my big chip stack here. I'm in second place. You got, let me let, let's let the field eliminate themselves. I'm going to just protect my stack. I'm not going to play a lot of hands here. He's just sort of sitting and waiting for it to get down to three or four people and then I'll mix it up some more. Is that the strategy? I think he came across as the grown up. Nobody really took swipes at him or shots at him and he didn't really take shots at anybody else.

1:32:22He did, again, try to focus the Republican party on what it's going to take to win. He was one of the only people on that stage who had criticism of Biden. I think it was a mistake not to criticize Biden's record. Yeah, they always talked at that. That was such a weird thing that they were all going after Trump and with that. You know, you had tax on nothing about Biden. The only attacks on Biden that I even remember from that night were from Trump's interview with Tucker, where he criticized. He might have. He destroyed it. He criticized Biden's lack of physical and mental acuity. But look, I think that if the convention were ultimately to be a broker convention, which all the different factions of the GOP had to agree on a candidate, then I think the Sanctus would be that candidate because he may not be the candidate who has most loved by any of those factions, but I think he's made himself the most broadly acceptable to all of them.

1:33:08The problem is, I don't think that's the way that candidates are chosen. You know, I think that what happens in practice is that the factions are trying to feed each other and that one faction is going to win. I think it's probably going to be the MAGA faction. That's the problem, I think, with this strategy. Look, he came across the grown -up and he came across as the most broadly acceptable. Okay. If this is a final table of a poker tournament, and Trump is going to sit down and debate three of these people, Chimoff, who's going to be left to debate Trump and be the final three or four seats here?

1:33:44Which three? I think it'll be DeSantis, Vivek, and it'll be either Tim Scotter and Nikki Haley. Interesting, Freeberg. Who are the final three who are going to debate Trump in debate number four or five? I don't know if he's going to show up. I don't know why he would. If he's up 1560, 70 % of the polls. I mean, it would be, it would just be such a Trump move to do not show up to any of these debates and just like get elected. Play the game. How incredible debate would that be if it was Trump, DeSantis and Vivek? Oh, fire. And then my, my fourth would be Nikki Haley. I think she did a good, just she had her moments in that debate.

1:34:22I think she had good advice for the Republican Party on the abortion issue. Yeah, she did a really great job. And she pointed out how, you know, much money, I thought that was a tea party moment for her. But that's when I warmed up to Nikki Haley a bunch. She's like, listen, we also approved $68 trillion. We got to look at ourselves and it was like, okay, is it the Tea Party 2010 here? I thought that was a great moment. Who do you have left free, brother? Everybody else played the game. Play along. Who will be the final three here to debate Trump if Trump shows up? Play along for the game. I mean, I'll give mine.

1:34:53Vivek seems to be in a good place. Okay. I don't know. The Santa says a lot of money. He's probably going to stick around. Yeah. So Vivek and Desantis are we all have consensus. I got it. Nikki, Haley, here's the crazy face. I don't know if he's gonna show up. We got your point. Yeah. You're critical of the fact that Vivek is having a boom or a surge based on his oratorical skills, which I think you regard as being a shallow way to. I mean, he's going to ask a question. But you're showing no enthusiasm for Desantis who actually has the track record of being the most capable executive. Oh, no, no, by the way, I didn't, I'm not, we're not talking about who I would vote for president.

1:35:32We even even had that comment. Like we didn't even ask that question once. Okay. So we're asking it now. Putting aside Trump, who do you pick? What was really interesting is hearing the governors speak about their skills. I think Nicky Haley, Chris Christie, Bergen, DeSantis all had moments where they shine from from, Hutchinson from my perspective, from a content perspective, which is where I was talking about at the beginning, which people largely ignore, which is that they actually had quite a lot to draw from and you know, so on policy that seemed pretty strong. Here we go. Final question.

1:36:02Final question. I want you to give me your one and two not Trump. Sacks we know DeSantis is number one for you. So then who's who's your number two to pair with them? Who would you pair with? Wait, to be what? To be the candidate to be the ticket Republican ticket. You're going to go to Santa's one and then who do you put with them as the number two? Well, for me, DeSantis and I think that the only candidates who have acceptable answers on what I regard as the number one issue of our time, which is Ukraine, because that could lead to over three. The only candidates who have acceptable answers are Trump, the vague, and DeSantis, meaning they've all been pretty clear they would de -escalate.

1:36:40I think all the other candidates have basically indicated in one or another they would escalate that. DeSantis, the vague is yours. So those three candidates are the only ones that are acceptable to make. Okay, so we take Trump off if Trump doesn't run, which that's my personal belief, but just of the people who are on stage, us, now you're going to Santis, the vague is your ticket, it, Chimath, who's your ticket, after one debate, not counting Trump. If the Republican ticket, who do you think is Republican? You don't look, I like to buy these deep out of the money options. I will go out on the limb.

1:37:07I think that the debate has a really good chance of winning this Republican nomination. That's why I saw. I saw, like, out right against Trump. Yeah. We're taking Trump off the table. So just picking it up. For example, for example, no, no, no, no, I really do think he can win this thing. And for example, I thought it was very clever when he said that he had a line. He said, Donald Trump was the best, let me be categorically clear. Donald Trump was the best president of the 21st century. And I was like, what? And then I thought about it. And I thought, why is he saying it? Is he saying it because he believes it or does he saying because it's like a tactic?

1:37:46And there's probably bits of both. Yep. Because I do think that there are elements where he fundamentally does believe that Trump has at least shined the path forward. And so I think he does believe it to some degree, but then I thought it's even smarter to have said it. And again, this is where I go back to, I'm not sure that that's oratory skills versus like understanding game theory, strategy and strategy and being a strategic thinker and trying to win. I thought that that was a very smart thing to have said. And all along that evening, I thought that he did the best job of preserving optionality for the Trump base to say, you know what?

1:38:28Vivek is all of the positive features of Trump without some of the negatives. So let's just clean up the ticket and let's go And I think there's still again, there's a long way Yeah, of course to have the call. I like the call But I would buy that deep out of the money option. And who's your number two then? We're going one two here one two either as to pair with Vivek or your number two choice in terms of No, then I would like if the deck doesn't figure out a way to slipstream past Trump the Trump or the nomination. Okay, taking Trump out of the rest, who is your number two? We're trying to get it.

1:38:59Okay, great. Fascinating to see this happening. I agree with what a lot of what Jamal said. I think Vivek is positioning himself to be the backup candidate for the Mago Wing. Yep, absolutely. And he's doing it by never attacking Trump and by combating him. By the way, saying that Trump was the best president of the 21st century, there's only been three. It was George W. Bush Obama and then Trump Right. Oh sorry Biden sorry Biden so it's been four George W. Bush was one of the worst presidents in America history. Yeah, so it's Obama obviously our Republican candidate is not gonna think highly of Obama or Biden so it kind of narrows it down doesn't it?

1:39:41The intelligence of actually saying the words Yeah, strategically brilliant. Yeah, I know I agree. Sax, what do you think about Vivek's unpopular statement? And I'd like to hear whether it's unpopular with the bass, but it was certainly unpopular in the room last night, that the climate change agenda is a hoax, which drew a lot of booze. That was good. Is that a lightning bolt kind of thing to say? Why would he say that? And what's the strategy there? It's like Trump saying he loves coal. And he loves coal miners. It's just panning. to me a little bit like you were trying to say to your agenda is a hoax meaning like all the ESG stuff is nonsense.

1:40:18But it comes across as him saying climate change isn't real and he's got an out deal with the repercussions. People are using climate change as a strategy. I think it's, I don't think you know what he believes, Jake. Yeah. His follow up comment around that was he said that it is an economic yoke on our country because the combination of subsidies and the lack of expansion of carbon is what's holding back the country economically. So that's, I think I remember him tying these two things together. So that's probably where the state is. No intelligent person doesn't believe that the planet's not heating up.

1:40:52Come on. And that it's not better to go to renewables. That's just how do you know if you looked at the science, Jacob? Of course I have. Yes, it's massive consensus. You're not deep on the science. You know, as deep as a person needs to go. I'm free bird. You just treat it. You just treat it. Look, it's just something you're supposed to believe in. No, I'm not saying that. I'm just gonna get the statistics of how the planet has got. That's it. I will say, Saks, it's right that it has become a thing that it's like we're also supposed to take as given. No one is gonna go up and say, here's the science that validates, here's the data that validates.

1:41:24There's some empirical evidence, and then people use counter empirical evidence to try and counter it, and that's what makes it a little bit of a movement now, which is the institutions, the elites, however they're framed have been wrong. on so many times on the things that they told us were given, that we're supposed to assume that this is a given to F that I'm not gonna be told what to believe anymore. And I don't wanna be told what to believe anymore is exactly what people want to say. Let me state my position. That's what they heard from that song last week and that's what they heard in Vivavera.

1:41:55Let me state my position. I totally agree. Yeah. Here's the thing, after COVID. Without me even making a comment on climate change, 100%. We were told so much bullshit that was in the name of science during COVID. Yeah, they told us the vaccines were safe and effective. I just want to clarify from a position before you respond to it. It's undeniable that temperatures have risen. I think it's a crazy experiment to run, to not try to lower it. It's just a crazy experiment. The planet is precious. I don't think we should run it. I am not dogmatic about it. It's not a religious thing. I'm not genuine about it.

1:42:27It's not an experiment we're running, Jake. It's called human development and growth. Yeah, and it's just, it's always dog buttocks. And the temperature goes up. So why wouldn't we use renewable energy? Let me say it again. When not polluting is good too. When you have self -proclaimed scientific experts and or 16 -year -old girls shaming everybody with pretty flimsy data, there is a while where everybody just said, they must be right. and COVID exposed the hoax. And so now we're a lot less prone to believe these self -proclaimed intellectuals and their jargon and their nonsense. So ask me how much money have I invested in climate change with all that data?

1:43:17Zero. Ask me how much money I've invested in technologies that will benefit climate change as a byproduct of national security hundreds of millions of dollars. Yes, and the reason I give you that example is that for me that framing was just such a turnoff because I couldn't buy into it Yeah, there are multiple reasons more pragmatic Realistic framing which a lot is to actually say maybe you're right, but maybe you're wrong But let's not even debate the issue. Let's just go and make sure we're not dependent on another country and fighting endless wars That got me off my ass to do stuff And I think there's a lot of people in America that are in that second category.

1:43:52They don't want Absolutely emotionally riddled dogma to drive their life and how they're forced to make decisions. You can come up with three or four really good reasons to not keep burning fossil fuels. They're dirty, they're pollutants, there are better options that are more sustainable, that are more cost effective. It's more cost effective to put solar in than to burn coal or build a new coal plant. So there's economic reasons. And then there's a full -down money for these. I don't know what we're saying is we're going to automatically get a trust. I am not automatically trusting. I'm taking the body of evidence.

1:44:25I'm not blindly trusting anybody. I'm taking the body of evidence and Saying that entire body of evidence. I don't really look at the evidence. I don't believe you got deep on this issue. Okay. Anyway, I haven't gone deep on this issue That's all I'm saying if you listen to a group of things to what I'm saying if you listen as opposed to telling me what I think and listen to what I'm telling you there are many reasons to to pursue sustainable energy, clean energy, and geopolitics is one of them, and polluting the environment is one of them, and temperatures rising if that indeed results in damages to the oceans and weather patterns.

1:45:03There are five or six great reasons to stop burning coal and stop burning oil. Look at these two climate white washes we're living in in this moment. People were so convinced they just needed to royal the country around the hurricane hitting California. Then by the time it landed, it was a storm. It was rain in Los Angeles. I asked people here when I got here, I said, how was hurricane? They're like, it wasn't a hurricane. And in fact, the news were so tilted about it. They had to call it, it could have been a hurricane. Yeah, they were just a storm. Ratings. Second is this thing in Maui, it turns out Michael Schellenberger has done some pretty good work on this is exposing that a lot of the reason these fires may have started was because of this radical climate agenda that caused the utility to not invest in the protective measures they should have around power lines.

1:45:56That is crazy, Jason. Oh, yeah. I'm not defending what happened in Maui. It's obviously incompetence. We should be bearing, we have the same issue in California, which is when dogmatic belief, there's a consequence. I'm not a dogmatic believer. No, I'm not saying you want to try and just try to make, I'm not saying you are. I'm talking at this point. When people dogmatically believe bodies of evidence that they themselves don't interrogate fully, they may lead them to conclusions and then actions that you are now seeing have measurable human consequences. If you look at PG &E and California, it's riddled with these issues.

1:46:28Yeah, they shut our power off because they're afraid that wind is going to blow down power lines and start fires. Yeah, I mean, and we just need to bury them. So I think that it would be great to like not debate the climate issue, put a pin in it, and instead just say, We all want our kids to be able to have clean air around us. You want clean water to drink. And we want to make sure that we have the resources to be productive as human beings without having to send our kids to war, or without putting the country in danger. 100 % which is exactly my point. There are so many reasons to take this seriously and move to renewables and nuclear.

1:47:00All right, listen, this has been an insanely great episode. Hey, let me just get one person's comments. So here's your red meat for Saks here. It sounds like there was the coup 60 days later, the guy who was running the coup in Russia, had a little accident, so random, maybe your thoughts, Saks. You're talking about foregoation? Yeah, I mean, he had some mechanical difficulties on his PJ. I don't know what happened. He's an extending that citation in for maintenance. What happened? They had a bad engineer. I mean, it's so random. Poor guy. The latest reporting from the New York Times this morning is that Progozans playing was not shot shot down, but rather they believe there was an explosive device on it.

1:47:41Oh, so we don't know You know, we don't know exactly you play it was a bird strike something random like a bird strike. No Not a bunch of them out. Somebody took him off the board really. Oh, must have been must have been Ukraine, right? That's who you're putting it on It's Ukraine. No, I mean, I think it's Probably pretty obvious who did it although we won't know for sure I think I think. I think. Listen, I think that that's it. Allegedly. Allegedly. That's what you always say whenever a hundred Biden's accused of doing something you always have to insert. Allegedly. There was a little cocaine and maybe some bribes.

1:48:18I think this resolves the question of who came out on top during that mutiny. There were a lot of people speculating that somehow pergusion at the upper hand or you was paid off or what it is not. You, right? Remember there was a line of thinking oh this wasn't a co if it wasn't a co then why did Putin whack him back back And it was exactly 60 days later. Is that correct? That was the other thing is that gonna ask a question How funny is it that it's like Putin's like hey, Prago's and come come and see me we're good You have nothing to worry about I'll send a private And then it's like listen, where are you going to a box?

1:48:53Yeah, you can take my PJ and he's I can't see, labor. How does this happen? Like, you can't even write this though. It's just like, I'm a lady, I'm a great burger, standing at his PJ and it's take me down to the orange oven. Oh, thanks for the ride, great burger. I told you, it's like Michael Corleone. It's unbelievable. Apparently there's a meeting about a month ago. I remember it being reported where Progozion and the other heads of Wagner came to meet with Putin. And the deal that Putin supposedly offered was that Wagner could stay together but enter reports to the Russian military. and the Wagner commanders were on board with it, but one person objective and that was pergusion.

1:49:27Oh, so it's a little bit like, remember that the meeting between Michael Corleone and Mogreen and Vegas. Oh, green, yeah, yeah, exactly. You know, Michael's like, think of a price and Mogreen's like, you don't buy me out, I buy you out, you know. That kind of reaction. Yeah. And the guy had some sort of death wish, I guess. You know what they say? Beware the dog that doesn't bark. Putin said nothing for the last two months. He was like, yeah, it's all good. Nothing out of the Putin camp. And then boom. Putin is a murderous lunatic who must be stopped and contained. I think this is the opposite of being a lunatic.

1:50:01I think this is somebody who is very cold and calculating. Okay, yeah, murderous, calculated sociopath. He figured out how to diffuse a mutiny. I don't think it was a full -on coup. But a mutiny that would have been very disruptive to his from lying if he had basically tried to violently suppress it. So he cuts a deal where basically he offers banishment to Belarus. Progojian was supposed to go to Belarus. By the way, we don't know exactly why Progojian returned to Moscow or St. Petersburg. He was supposed to be staying in Belarus or Africa. So maybe he violated the terms of his probation. We don't know.

1:50:36There were all these people on social media who were pinning their hopes for regime change and liberal reform within Russia on Progojian, which was always absurd because he was this warlord whose behavior and conduct was even more erratic and violent than Putin. So he was never going to be a great vessel for liberal reform in Russia. Nonetheless, there are all these people who pinned their hopes for regime change in Russia on progoation. We can see now what a stupid idea that was. The Russia regime, whether you like it or not, is stable, it is not unstable. Russia is winning the war. And you may hate Putin, but he is still master of Russia and eventually we're gonna have to deal with him These fantasies that we're gonna be able to regime change him I Think are absurd and they've led us to this horrible point.

1:51:24Okay for the dictator for the Sultan of science and Focus Sucks with the slick back hair. I am the most great partner. We'll see you next time. Bye -bye Well, let your winners ride

1:51:50I'm going to the beach. What? What? What? What? What? What? What?

1:52:04What?

1:52:07What? What? I'll just get a room and just have one big huger because they're all just like this like sexual tension But we just need to release that out What you're that beat? What you're a beer of beef? Beef of beef? We need to get merch. I'm going all in!

1:52:30I'm going all in!