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

25:26So you have about four million people employed by contractors in DC, 1 .6 million more at the States, actually by federal spending. And then you have the NGOs, no one knows the NGOs by administration took down the data I used to see things in 2020. So we didn't even know how much money, but we know it was hundreds of billions and so that's pretty crazy. The number one thing about how doge is not being done fully is that Elon is doing an amazing job You know whether or not he cuts 500 billion or trillion or a lot more But the senators and the congressmen are not willing to take it out of their bill their reconciliation bill right now There's talking about cutting one to two trillion so rather like this is over 10 years.

26:01It's ridiculous It's ridiculous if it was equal to what Elon was doing It'd be at least five trillion dollars and I push a bunch of them They say oh the Congressional Budget Office and all these things and I'm sure there's some tough things there But like this is crazy. We need to see what these cuts need to be on doge and we need to cut five trillion and then These people have the balls to do that is there's not the political will to do it is my interpretation and just just Just go honeys. Let me just show you one chart to back that up. I have my new discraciad .com for the week Look at this trauma.

26:29I'm gonna talk about software and waste 35 ,855 According to Doge, breaking news, service now licenses on three products only being used by 84 people in our government. Oh my god, you're kidding me? 11 ,000 Acrobat licenses with 0 .0 users. Discretion! Absolutely, apporant. And I'm saying it right now. I want an investigation into procurement. Who sold this? Who bought it? This could be a crime. This could be fraud. That could be kickbacks. I'm saying it could be. I don't think it's that. But I do think you have to look at the earnings of these companies and question where's all the correct number two.

27:15Totally correct. If service now ever wants to work with the government again, Mr. President, Mr. President or president, I want them to pay us back for the law and use licenses. And I want to follow out it for the last 10 years. If they don't pay us back that money and give us a credit hold on hold on. The same forever hold on. It's not thank you Mr. President. This may not be service now's fault. This may be the ineptitude of the people of the license. But they should still give us a credit. I want the money back to the American. I do think Adobe has the worst have you guys ever done Adobe subscriptions?

27:47They're impossible to cancel. I think Adobe. Eleven thousand. What's your only? The only thing harder than canceling in Adobe license is trying to cancel Wall Street Journal. I was about to say World Street Journal. That's the worst. Discrossing all the fame. Let me just say something about the budget because Joe brings up something important. Unbelievable. I'll just say it again at the sake of being redundant. We're getting to the phase where the details are complicated and they now matter. So we've talked about repealing the IRA in its totality. So that was a statement and there's theoretically a lot of money there.

28:23But the details now all of a sudden become complicated. fork, published a report just this past week. And what do you think it said was the percentage of incremental electricity that was generated from renewables versus non -renewables? I'll tell you the answer. It was almost 91 % in December. So if you now tie two huge initiatives together, which is how do we find a budget that saves money and how do we continue to win an AI? Maybe you would have thought those weren't related. Well, guess what? We know that AI needs a tremendous amount of power. And whatever you thought you knew, actually, you had to reunderwrite because what Elon has shown is actually you need to now create these mega clusters.

29:11100 ,000 GPUs going to a million GPUs. All of the power forecasting that we have is miscast. It doesn't even account for this. Number one, number two, there are 35 ,000 applications into FERC to get approved to generate electricity. 35 ,000. That's going to meander through some administrative rigour morale. There is a five year delay to get a gas turbine into America and online. Okay, if you ordered one today, the fastest that you can get it turned on is 2030. The fastest that you can get nuclear turned on is 2035. So we don't have the ability to generate incremental electricity very quickly but for renewables.

29:57But then if you rip out the IRA, there's many parts of the IRA by the way that are just trash. Nick, I don't know if you can find it, but Barry Weiss found this insane thing that made me so angry, which I'm happy to talk about, which was like a 30 -day grant process that resulted in a $7 billion grant to some shell engine. Oh, this was thrown the gold bars off the castle. Hold on a second. But the other part of the IRA, this narrow part, is what it did to reinforce tax incentives and tax equity, which is a $200 billion market that incentivizes that 90 % of energy generation. So my point is that when you start to get into the details, when the Houseways and Means Community has to figure out what part to put back, this is going to be hard because it's I called on if you got the whole thing, now all of a sudden you take 90 % of the incremental energy generation incentives out of the market, you don't have enough electrons.

30:52There isn't enough electricity. So then you lose the AI race or you start to lose it. I think the point is that we're now in the hard part where the details really matter. Listen, you got to start with the chainsaw. We saw that at Twitter. And by the way, Trump was talking and maybe you do when we started this, he just tweeted this out. He said, guys, now it's time to get surgical. He said, perfect. Yes. That was the better for us about to use is like, you know, you start with you cut out the goddamn service now in Adobe Subscriptions and then you work on something, you know more depth and maybe that's where we are I are a just for the audience Impletion reduction and I just do a rant on this on this pop -up NGO thing to me This is like the worst of America and it makes me so angry and I'll tell you my lived experience So I'm on the other side of this I started a company with these guys from Tesla to make battery materials in the United States in in 2019.

31:43We grind, we grind, we put in 10, I put in tens of millions of dollars, we get a deal with a big OEM, and then you see these DOE grants. We spent millions of dollars, we file a very detailed plan to build battery metals and battery capacity in America. We got rejected, okay? It was an entire year long process. We got rejected. We put it past us, we kept working, we found more deals, we found a way to survive, raise a little bit more money, and then we applied again on some success and we got a hundred million dollar grant, okay? That was, that's what just happened this year. But then yesterday I read and Nick maybe you can throw this tweet up, this Barry Weiss investigation.

32:29Somebody in 30 days who was connected to the democratic infrastructure had some shell organization that got a grant that was 70 times bigger than us. Like we've made stuff. We have deals with OEMs. We have to validate in every step of the way. We were rejected once. So our process to get a hundred million dollar DOE program was two years. These people showed up in 30 days and got seven billion. That's just, yeah. Why don't you put, why don't you lead with DEI or something? You would have gotten a billion. You just led with the wrong thing. You were actually providing a product or service people to see.

33:06This is why there's no equity in there for the minerals. This is why I'm still frustrating to build for the government guys. This is what Palantir and SpaceX had to deal with. It's why they both sued the government is that all the friends who used to be the CIO used to be the general made the right donations, had the right kid on the board. It's all corrupt. And then the actual substantive people you have to work like that. I think it gives $7 billion in 30 days. What could you do? We're going to find out. You're going to budget. Democratic Off -Predits on the board. Let me, well, let me challenge you guys on one point.

33:35There are now claims being made by reporters and by third parties that are saying it is a new form of kleptocracy with all the friends of Silicon Valley installing their friends and agency heads as undersecretaries and so on. That's going to benefit Silicon Valley investors, Silicon Valley companies. Joe, Chema, J .Kell, I mean, how do you guys react to the claims that there's now, you you know, this new kind of kleptocratic movement. It's the old guard is gone. Go ahead, Joe, you have to. You have Palantir, you have Andrew. Also go ahead, you answer, Joe. Let's talk about this. I mean, when we go to DC, when I go to DC, what I am asking is I want there to be a fair competition.

34:14And if I win, I want my company to actually be able to win the contract because the way it worked for 20 years, like, like, Everest, you could just raise $250 million this week. It's a great company. We have big contests four years ago, L3, Raytheon, Northrop. These guys, you know, in and out of government for decades, they've gotten tens of billions of dollars to the same technology area. When we went head to head with them, we didn't just beat them by a little bit. We shot down the hardened drones nine and a half times farther away, same size, same power, nine and a half, to completely wipe the floor.

34:41And the cost difference between the bids, like are you saving us massive money? Massive money, I invested only 30, 40 and the whole thing at that point and they've spent billions and we have much cheaper, much better, not even a question. And you talk to the, and you talk to like at the time the cheapest half of the year for us, the guy who went to the four star And he says, well, Joe, this was written three years ago. It looks like Raytheon probably did help write it and they required all these things and your way you're doing it. I'm like, yeah, I'm using a chip instead of a cathode rate tube.

35:07That's why it's working so much better. It's like, yeah, but it was written for the way they're doing it. And I could overrule it, but it'd break a lot of glass. So you'll probably win again in three years because everyone knows you're the best, but it's too stressful to give it to you right now. Like that is, so what I'm doing is I'm not going and saying, give my company's money. I'm saying, I'm saying make this actually a functional logical process and give me a chance to win if on the best. And that is a hundred times better for our country. To push it away. But how do you make that transparent?

35:32And how do you avoid? Yeah, there has to be massive transparency. How do you avoid the perception of conflict and the perception of kleptocracy? Well, it's actitution reform. So this is a really important story. You guys probably know we were in the Philippine jungles in early 1910s, needed new pistols or pistols were terrible. They have a one -page thing, what they needed. There's six arm manufacturers competed. That's how we got the cult 1911 and three months, It's one by the by a large amount. It's an awesome gun at 12 years ago We had a 700 something page document that the bureaucrat spent years on outlining what they needed for a new pistol I'll probably need to do DEI stuff.

36:06I have no idea. It's a long Comical document. They still don't have a new pistol today and so what the way we do it is we have a very clear process Where it's very specific on the outcomes not on the inputs and you know a contest and then and then you make sure that you know It's not it's obviously wins guys It's not like we're like slightly better. It's like we're shaming them. So the only way they can stop us is by playing these games Because you're just so much better I think that if you're in the administration or if you Join some part of the administration whether you're a full -time employee or a GSE or just a volunteer There's going to be that perception of impropriety or influence peddling.

36:45That's comes with the territory. So how do you avoid it? And I think that Joe is exactly right. When the administration was getting formed, one of the things that happened, I had an opportunity to work with some of the folks to write some proposals for what theoretically could happen in some of these bigger government organizations where there's just huge pockets of spend. And where I spent most of my time is what Joe talked about. How do you create open standards so that it's very clear what the competition is so that the rules on the ground can't get manipulated by people who are rolling out of government into private industry or somebody has a very deep relationship because of lobbying.

37:26Those are the things that pervert the clarity of what should happen because in what happens can be far afield to that. So number one is I think knowing that this time around a different class of people are going to be seen on the a quote unquote popular side, it's really critical that all of us that are involved in this promote extremely transparent open standards. Publish every RFP, publish every spec, publish every evaluation criteria, make these things as mechanistic as possible. So for example, if you're going to go and field a drone, there's an incredibly detailed set of data that you should be publishing in.

38:06It's not dissimilar to how an FAA asks for flight test data and you should be able to Review that so that then it can be escalated so that if somebody then gets a deal because of preference And you think you're structurally better on the data There needs to be an escalation and a release valve that says hold on this is just being manipulated And I think that's how you fight back. Yeah on not just this version of a potential Winning side versus losing side but forever in the future the government should be open The government should be transparent and every single point at which they're making a decision and giving money Should be measurable and known you guys got exactly right.

38:46There's transparency There's oversight obviously, but there's whistleblowers as well And there's the role of the press in all of this to sort of fact check it and to check in on it As a safeguard with the public getting engaged and that's one of the great things that Doge has done by having a Twitter handle So I can pull up, hey, here's what's going on with these licenses and make an example. So that kind of transparency helps. And then finally, we have to look at campaign finance. That is where a lot of the appearance will go back to exists. Go back to this other thing because that's a super important point.

39:20Like it just occurred to me that if what you said happens, then look, the incentive today in America is to try to position oneself to have one of these roles. And the reason is because David of what you said. there is the chance to then preferentially nudge an opportunity your way, right? Why do people sit on committees? Why do people volunteer at least at that level? And if you introduce open standards, then the real incentive to want to go do this should be because you actually are patriotic and want to just help. So, Jamal, I think you're right about the standards, but I want to push back on the incentive today.

39:59I know a lot of the people who are getting into this, and I really do think they're there to fight for the country. I don't just say this like as like you know naively or something like these people really are there for the right reasons for the most part. No, I know I'm just saying generally over like the last 50 years if you look at people there is this implied sense like for example like Goldman Sachs had a direct line to become Treasury Secretary. If you were the CEO of Goldman you were the Treasury Secretary. Now don't you think that that was discussed amongst partners at Goldman? And do we not think on the margins that that beneficially helped Goldman?

40:30Of course it did. We'd be naive to think otherwise. My point is not that. My point is just that going forward, the best thing all of our friends could do is just make it all open source and open standards. That would be an incredible artifact, I think, for America. Joe, I think you telling us, hey, I trust these people, there are friends, you know, that works with all of us, because yes, we know them. We know they're gonna do the standup right thing. And if you already have a ton of money, like some incremental amount of money is not going to move the needle for you. It's it's it's far as good for us to think that David Sacks is going to give up four years of income producing Have to sell all his positions and that is in some way good for his balance sheet It is not he's gonna miss out on four years of AI and the massive run up of our lifetime in order to serve the country But I can tell you people don't believe that just like you know used talked about the Kleptocracy and the revolving door to Raytheon or whoever That people have talked about forever.

41:24What you need is whistleblower protections Journalists going after this like Barry Weiss is doing old school journalism investigative the whistleblower laws are great in our country We need to keep reinforcing those but I'm gonna go back to We need to limit campaign contributions. We have to get rid of super PACs because these create the appearance of impropriety and the appearance of Impropriety with Trump's mean coin and that announcement on Sunday for the crypto reserve was you know So it doesn't help the mission here. That Trump is trying to get done. So maybe you could speak to that because that's where the appearance of Ipropriate is great.

42:00You got people like Salar who is doing his Bitcoin thing. He's going on Friday and you know, Sacks will do a little bit here and announce some stuff on the program hopefully. But maybe you could talk about what you objected to with the coins, the meme coin, and or the the announcement of the crypto reserve should our government and After all this donations from massive people like I saw at the crypto ball all the people who were tweeted by Trump that looks terrible Yeah, yeah, what to think I agree with you on the tweet You're sneaking two things together here though, so I want to really precise Jason cuz let's be precise That's what we do here.

42:38There are a lot of different possible Ways that people can help politicians and so one of them is if you're a celebrity like even all you guys show at this point You can you can affect what people think that's a powerful same. There's there's other ways that if you're part of a big union You're part of a government union. That's a very powerful You know influence in our society if you're part of a American medical association health care system There the doctors and health systems are very powerful even without super PACs in our society and what is super PAC is It's a former free speech and it's true wealthy people have the ability to influence things through that speech But it's like one of many and so if you're cutting that you're basically saying okay I don't want Elon and Joe to have as much say there, but I do want to have even more say for the celebrities and for the doctors and for the union members and government.

43:23So you have to realize you're dealing with a complicated situation with lots of funds of power. I do agree with you, as I said, and listen, I saw David and we gave each other a hug. I think we're all good, but I was very frustrated with posts of Trump mentioning specific coins. I don't know who was trading them before. It just looks bad. We're fighting all this grift, including all these things where we have the moral high ground. I agree. I don't want to give up the moral high ground with these silly schemes. that's 100 % the case. Are you saying with like there's many forms of influence that you think super PACs and rich people should be able to?

43:51I think speech is important. I think $50 million, $20 million donations. You actually think that's fair for democracy and everything. I actually think speech is very important. I think the ability for me to send out something and say, guys, I'm studying this, it's corrupt, it's been corrupt for 50 years. We have to all get together and stand against these health systems, these crazy defense companies that have kept you in the open everything. I think my ability to speak and do that and to convince people is really valuable. I've passed dozens of laws each year in these different states by convincing people.

44:19Nothing to do with making me money that these incentives and accountability are wrong. I think that's a good thing that I'm allowed to do that. Should they be a cap? So when you say speech, you mean write a check. You mean write a check? It's not very large checks. You have to be careful. The reason this is a pre -incorporate rule for super PACs is not just about giving, you're not giving them the money you're actually speaking to yourself. So when Elon spends $300 million, he's actually spending. it many times, putting out his own speech or he's putting out his speech. So you believe people to go?

44:45What about you, Chema? You think that Soros, Elon, let's take the names out of it. Do you think there should be a cap on what you're able to donate to Super PACs? Because this does create the massive appearance of impropriety, whether it's in crypto, whether it's on the Soros on the Democrats side. This seems to be, I mean, I'm in favor of there being more hard caps, whether it's 5, 10 or 25 million, I think there needs to be caps. And I think we should put a fund together for the last two or three people and let them get that money from the government It's to run their campaigns like other countries do.

45:15I think it's important to note that this pendulum has Swung pretty wildly out of wax in citizens united. Yeah, and it's not this is not a Republican thing meaning there's a whole bunch of factions There's the George Soros faction. That's true There's a liberal Democrat faction less we forget I think Zuck spent 350 million in 2020. Oh, yeah. Then there's the Koch brothers faction. And then there's what showed up this year with Elon. So my point is there's all kinds of pockets of spending in all manner of ways. I think the question is should citizens united have allowed this kind of spending? And are we better off as a democracy for it?

46:00And I think the reason why I would be in favor of going back to the way it was, is that I think the biggest problem is the redistricting and the jury mandering that happens and the amount of influence that happens downstream inside of state and local elections and there are just places that are just so sclerotically stuck. If you look at the federal, despite all the spending, you still see at the presidential level like pretty reasonable and healthy competition between two people. It's much more difficult to see dynamism lower and lower down ballot. And so the reason to get rid of citizens united from my perspective is that you'd have much more vibrant local state, mayoral elections, those things have huge impacts, I think, to quality.

46:52Okay. So you and I are in that camp, chosen the other. Freeberg your thoughts you're the deciding vote here. It's two to one in terms of the panel but you just said to me you you just said to me you think we should go back. This is the prime courts on my side so you guys are in trouble. The point of this program sometimes is not just to is to take ownership of your opinion and defend it. I want to see people own it here in the discourse or freeberg you can say pass But you don't get to say nothing. Okay. What does it mean to spend money on a political point of you? Exactly. What does it mean? It means you can put it up a book.

47:32I mean, the other side want to censor books. That's the thing. Like, like, if I want to, if I want to pay someone to make a book for me, if I want to pay someone, if I want to pay 50 people to go and engage the community, so I can get some leverage on my time. If I want to pay someone to make a website to promote my point of view on something, I should be able to do that. And if my point of view is related to a vote that Congress might be taking, or is related to a candidate that's running for election, or is related to taxes, or is related to some other social issue, I don't know how you can kind of very clearly delineate the difference between some kind of political party or some political candidate versus my having a point of view on an issue.

48:18If I care very deeply about animal welfare, which I do. And if I had enough money, that I felt like I could spend that money to influence people's point of view to improve animal welfare through laws and through candidates, I would spend that money. And I should have a right to do so. And I shouldn't feel restricted that I can't go publicly express my voice, make websites, put up billboards, put up posters, buy ads in papers, telling people how f***** wrong it is, the way we treat animals and slaughter them and keep them living for their very short lives in terrorist conditions. I want to be able to express that point of view.

48:52And so I kind of veer to this idea of life. Can I ask you a question? Do you think that your money spending, if the balance of power to get your view was to redistrict certain places so that then you could get a majority of people that were ideologically aligned to you elected? Would you do that as well? Forget there's no ads running. This is about a different form of electoral influence. Would you do that? So not spending money you're saying? Like I'm not spending money to you spend money, but it's not for ads. It's not for those works. How do you spend money to redistrict? You get certain people elected by trucking people out to vote and then you get that person to join a coalition that then redistricts.

49:32I mean, maybe trucking people out to vote as an action should be illegal. That seems pretty reasonable to me. Well, yeah, I mean to your point, and freeber, you asked like, how do you define it? What I'm trying to point out to you is for every dollar that goes into politics, I think it's, I would ask you guys to just suspend belief that 100 % of that goes to ads, none of what I'm trying to say. Yeah, I hear you. I would say a very small, not a very small, 10, 10, 10 to 20 cents goes to ads, 80 % goes to all kinds of shady stuff. And this also can be said. By the way, you call it shady, but I would argue, like, what if I want to make a bunch of websites?

50:04What if I want to make like, you know, have people go out and express the point of view in the town square. You know, like there are other aspects of what you might find. What I'm saying is that's fine. That's in the 10 cent bucket. The 80 cents, what I'm trying to tell you explicitly is how it's spent today is not in the ways that you think. I think that the fact that someone calls it shady might be because they disagree with my point of view. And if they don't agree with my point of view, they might not go with shade. I think the tactics today, look, I play with the conditions on the field. But if you look at them, meaning like using dollar incentives to incentivize people, that's allowed today.

50:35You can pay people to vote today. Well, we have to pay them to join a super PAC or something like that. But let me, let me just get Joe involved here. So Joe, you heard free birds. You're kind of in alignment, I think, broadly. But we can define some very specific things that are obviously political, like the window of when you spend the money. Like telling people, well, because you could say in the six, in the year of not trying to be election, hold on, that's a specific vote. I get it, I get it. If you're not, if you're targeting an issue, that's one thing. But when you tell people, she's for the event, he's for you, that's clearly a political edge.

51:09Now, you could take those ads, you could take canvassing, you could define a subset of behaviors, and you could say you can raise up to this amount of money per person in that way. That's me. Those things are explicitly political when you tell people this is about candidate A versus candidate B. If you were to say this, we're not going to mention any candidates where we're going to talk about your puppies, and you try to increase your cue score here on the goddamn and pod by saving puppies. But animal welfare is a f*** up issue. I know, I'm thinking you shouldn't just just be agreeing with you.

51:39I just don't like how many points you're scoring with the audience over. Did you guys see this thing on Instagram? My wife showed it to me. I'm gonna save five puppies from a ranch. Somebody saved some cows. Did you guys see this Instagram reel? My wife showed it to me. It's like of a calf chasing a dog. And it cuts to this Asian guy. And he's like, what's the big deal here? What are we talking about? You know, you want us to not eat everything blah, blah, blah. And then he realizes that they're talking about the dog versus the cat. Don't trigger free. Or don't do that. Leave free. Free. I got 33 acres of paradise.

52:11Don't laugh. I got 33 acres of paradise. I'm going to save every animal in central Texas. I'm going to eat them. And I would give you money to do that. Okay. I got a deal. Actually, I actually agree with what Shabbat was saying about jury mandering. I think we could use AI for that. It's a separate conversation. It's discussing how it works right now. However, Jason, the problem at the end of the day with defining what's is the boundary cases are really tough and you do end up needing effectively, effectively a censorship board. Examples, I write a book about the dangers of communism and it explains how it's linked to things going on today and I like give it out at like all these people are gonna be voting.

52:48I mean, there's just so many boundary cases that you can spend up to 10 million a year doing political activity. 10 million a year gives you a cap so you can buy so many books and buy so many. This is not political activity, it's my art. This is an artistic piece of not communism. But when you put the book in and say vote for Biden, then we would say, okay, you put a vote for Biden. You can't say, though, it becomes, it becomes really complicated. I just ran it through Groc and what the answer was is that 56 % of all the spending happens to be on ads and 44 % of all dollars and 24 or 25 was spent on other.

53:24Yeah. So there's a lot of you put canvassing in there. I bet you had 75%. So we just say for those two activities put a hard cap on them. I would be for that. But let's keep on talking about the market market. Let's talk about core weave. All right, gentlemen, we can't talk about politics all day as exciting as it is. Let's talk about this core weave IPO. If you don't know, core weave is part of a new type of infrastructure provider called Neoclap. It's a fancy way of saying using GPUs to build data centers. This is a really interesting company because they got onto GPUs early and they had a lock -in on a large number of NVIDIAs GPUs.

54:02They've got 32 data centers with 250 ,000 NVIDIA GPUs. As an example, when Elon built the largest fastest data center, Colossus, that was 100 ,000. So this is really a big company. They're going to do an IPO. Analysts are estimating they're going to raise at least $3 .5 billion, at over $30 billion. Their second day was $23 billion in November of 2024. So this is cooking with oil. They've got incredible revenue, by the way. 1 .9 billion in 2024. But if you look at two years ago how much revenue they have, the growth is amazing. Nick put a chart in here in post because it's like a 10X, I think, each year or something crazy like that when I talked about it on the other pod.

54:48But they're very unprofitable. almost a billion dollars in loss in 2024. And that's interest payments on a lot of their debt. They have almost eight billion in debt. Huge debt load to buy all these GPUs. And that has been the question we've been talking about here, Tramoff, is are these GPUs, are these NeoClouds fancy way of saying? I'll give you a couple of factoids about core feedback, which I find super impressive. So the first question is like you would say, why didn't AWS GCP and Azure eat these guys for breakfast, lunch, and dinner. And as it turns out, they had one very specific technical decision that I think was extremely valuable, which is that these guys did not use hypervisors.

55:30Explain what that is. So a hypervisors basically a middleware layer of software that allows you to abstract units of compute so that then you can make them available. And instead they basically allowed you to write to the bare metal. And this very native approach that allowed them to get a of traction. So it's a really interesting thing to note that just that simple thing, like one simple technical design decision can allow you to build what looks like, at least from the revenue perspective, an incredible business, right? So kudos to them. Super awesome to see that you can still maneuver around the big giants.

56:06I think that that's cool. I think the big question with CoreWeave is, what is the period of amortization and the useful life of these GPUs from Nvidia. And I think that that question is up in the air. As you said, Jason, a lot of their losses are these interest payments. And as long as that they have that calculated right in their models that they used to borrow all this money to buy all these GPUs from Nvidia, this is gonna be a killer business. To the extent that they got that calculation wrong, meaning we thought the useful life was 10 years, but it turned out to be five. this business is deeply underwater.

56:45So I think that that's the bet. The bet is they've built an amount of headway. They're going to continue to do this good technical engineering. But the other side of it is the useful life right is the technology curve right is more is law and all these other things will they work in its favor or against it. And I think that's the Joe, people say useful lifespan, GPUs, free to five years before the next generation is so much more powerful, especially in relation to power consumption, that it's worth running it. Now with servers, old CPUs for running Facebook, it's a totally different story. You can keep those running five to seven years before it's not worth running and you have to turn them off.

57:27What do you think here? You're right. There's a technical question on the power and all these things. I actually know Brandon. He lives nearby me and my house in Montana. He's a really smart guy and I think the really interesting thing you know when they built this So I think it's relevant going forward is these guys were commodity traders and they're originally buying stuff to like mine Bitcoin Other stuff like that and they realized as commodity traders There's like a certain supply and demand in the market of GPU chips But also of all the data centers by the way and it's really it's really interesting what they did is they locked down The full supply of tons of data centers tons of the power they needed tons of the chips and they're very very thoughtful I mean, they're effectively their traders and they're very economic and I think they have a lot of the stuff well.

58:05That explains the technical decision because they have to have very low latency throughput in order to transact efficiently as commodity traders. I'm guessing as well. There is one, Killie's heel. That's cool. For this company, Friedberg, they had massive revenue growth, but they have a dependency. 60 % of the revenue now from Microsoft and Microsoft seems to have done this either. It's unclear, but maybe to service the open AI deal where they needed to give them a bunch of infrastructure or it might be for Azure. It's unclear. People have been asking this question for a couple of years now. But what do you think of a business with one client with 60 % dependence?

58:41And this is how these things work Jason, is they just wanted to client tends to grow really, really fast. And they're actually, you know, so they do this orchestration framework called Sunk. I know a little bit about it. It's like really easy for scheduling workflows, batches, and all these things. I think a lot of other people are using really well. They just bought weights and biases right which like everywhere that's basically. Yeah, it's a great buy and they're killer They're killer for training. I mean, I think these guys crush and training Satya Nadell said that Microsoft was doing this maybe not for a long -term usage to free bring your thoughts on Corviv I'm not as deep as you guys are I remember in 2003 I worked for nine months at a private equity firm and I would cold call like companies that hadn't raised venture capital that were profitable and fast growing and see if they would take our money.

59:28That's the business model. And I spent a lot of time in the sector of businesses that were called speed doublers. I don't know if you guys remember these companies. 2003 was before we all had broadband internet. So a lot of people were using dial up and you could pay $9 .99 a month for a speed doubler. And what it would do is it would basically on your browser set the server to be their server and they had a cash of many of the popular sites on the internet. So when you started browsing the internet on your computer, everything loaded faster because they had really fast servers and you got these cashes.

1:00:00And these companies, dude, they were doing like tens of millions of revenue, high margin, 50 % plus EBITDA margin, and growing like 100 % plus a year. And I remember we spent a bunch of time looking at these companies. This is right before I joined Google. And I was like, this feels like a transitory business. It's like an arbitrage between where we were and where we're going. And that's what ended up happening. Many of them just cash flowed out, the founders took money, or they were able to get a really smart private equity recap done, get some money out and run at some low multiple of EBITDA or something.

1:00:32And so I worry a little bit about a business like this where there's four or five companies that are each doing $80 billion of CapEx this year to create infrastructure that effectively starts to replace what these guys are effectively offering out as a service. That would be my biggest kind, if I were to do diligence on this business, that's where I would spend a lot of my time, is like, guys, what's the capacity going to be in a year to sort of like when broadband hit the internet, you didn't need speed doublers anymore. Do you really need to be paying as much as you are today? Is there going to be as much demand?

1:01:02How much is this going to get bundled in with GCP or AWS and so on in the future? So that would be my kind of macro hesitation and caution on the diligence as I ran my diligence on this thing. You basically need an economist to map this all out. It's the same question for data centers in a related way, right? Which you just need to map everything and I don't have those numbers. So you're right. It's a hard thing to figure out. That's right. Well, the founders have control of the company. And they sold 5 % of the money. They sold a lot, maybe it's 150 each. Yeah, but they've kept most of their position.

1:01:31They're smart guys. Yeah, they still own the majority. I don't know. I don't want to speak negatively about the business. And I haven't spent much time on it. But I mean, I think that that was the worst that can happen if you speak negatively about somebody's business. Check out you. I'm so sorry. Even though maybe you get a little bit more. I'm not a good guy. You tell it right. Check out. No idea. No idea. I like to be on somebody's **** list per decade. I don't know. I mean, the ratings keep going up for this week and startups and all. And so I'll take a shout out. Are you purposefully starting to dress up, Jake, by the way?

1:02:01Because I notice every week now you're wearing a bike. I had a speaking gig. I could have speak at a speaking gig. But my friends at Eton reached out to me. So I might be trying to do a little griff right now. Are you plugging right now? You know, Laura Piana hasn't reached out with Eton shirts, which I'm wearing right now, ETOM, you know, the famous shirt people are, they've been reaching out. And she also got, no, no, no, no, I got, but I'm also saying Tom Ford's people reached out and said, you know, that little pelving, you can take that off if you want. We'll have somebody come over. So I just want to shout out my friends over there.

1:02:30I have no, I'm going to go show the key ton, KITO and Jackets. I've been wearing KITO. I'm very nice. I like Jackets on earth. I wear them all the time. I love those jackets just saying let's move on. By the way, yes, and Joe Lanzo, I was recently by the weavers, the weavers in China. He gets them specifically made for $17. I was recently, I was recently sponsored by a company. This is incredible. What they do is when you're flying into this, put it in and it is right. They meet you at the HBO and they take your watch and they, they set the new time for you. So especially if it's a mechanical watch, it's a very complicated.

1:03:06Oh, yes. This is very important. Right. I got you know what I was you got to be getting it This exists to my Through to my and I had my watch collection and they did this for me when I was flying But you know mountain neck row and malt absolutely This is like four spy bill is telling you how to look at the world we should get rid of income tax I'm sure everybody listings like hmm really convenient no income tax for the billionaires and sent to millionaires Good job guys. All right. Let's keep going to have the All right, Jimov, you know, we've been going back and forth in the group chat and you've been talking about it publicly, maybe Main Street versus Wall Street and what's going on in the markets here because there's EU bond issues.

1:03:48We obviously, it seems like in some ways maybe the Trump campaign is not thinking about the stock market as much as they're thinking about the bond market. Explain to us your take on markets right now. Yeah, I think that there's three markets that are important. There's the US long end of the curve, so this is the 10 -year bond yield. I think then there's the US equity market. And then the most next important market are the European bond and equity markets together. And I'll explain why in a second. But just on the first few, I mentioned this before, but I really do think we're in a secular shift where I think the magma majority and the base of people that can be a reliable voting block in the future, as I've said before, are working in middle -class folks that don't necessarily own a ton of stocks nor do they own homes of which there's a lot.

1:04:45Second cohort are people that are pro -innovation and protect, and the third are patriotic business owners. I think that cohort is very large. And I think that when the core strategist inside of MAGA figure this out, one of the big takeaways is that they're not going to care about the stock market in Wall Street. And a lot of the policies will be viewed through the lens of Main Street. And I think that you started to see this rhetoric now, one from Bessent, and we'll play this clip in a second. And the second was just today from Trump himself. But Nick, do you want to play the best in clip if you have it?

1:05:26I think over the medium term, which is what we're focused on, it's a focus on Main Street, Wall Street's done great, Wall Street can continue to do fine. But we have a focus on small business and the consumers. So we are going to rebalance the economy. We're going to bring manufacturing jobs home. That was the first one. The second one was just today, Nick, I sent it to you. Do you want to just show it to these guys, which I think is really interesting. So it says here, breaking news from, I guess, unusual wells. Trump has just said he's not looking at the stock market. Okay. So I'm not sure I believe that, but okay.

1:06:02So why is this actually valuable? Well, if we are incentivized at the government of America's incentivized to implement policies that crack the equity markets, it's actually really good in some ways. Number one is if you deflate asset prices, you also deflate inflation. Okay. And give an example there for the earnings. Sorry, make it clear. In video is ripping at all time highs. You are like, oh wow, I'm so cash rich. You can go get a margin loan. You take that money. You reinvest it in a second home and a third home. You sell some stock. You start to buy cars, all this other stuff. It drives consumptive behavior that on the margin isn't there.

1:06:43if the markets were much, much lower than this. So if you rebase the equity values that people have, what you do is you actually depress the amount of free cash flow that they have to spend on other things. So it's a deflationary tactic. How the bond market reacts to that is if the stock market goes down is you start to become a flight to quality, right? Oh my gosh, there's volatility in the stock market. Oh my gosh, I don't wanna deal with the stock market going down, let me just sell, take some chips off the table and buy 10 -year bonds. When you buy the bonds, the interest rate goes down. Why is that good for America?

1:07:21We have 10 trillion dollars we need to go out and borrow in the next nine months. And so if we can pay 3%, 3 .8%, 4%, we save ourselves trillions of dollars versus if we had to pay 4 .5, 5, 5, and a half percent. So that's the second thing. And then the third thing is that right now what we had this week because of the Ukraine and Zelensky thing is basically Trump say we are totally risk off this war. And I'm not going to debate whether that's right or wrong, but that's what he said. We're going to curtail the aid. We're not even going to share intelligence. They're on their own. What did that force?

1:08:00What happened this week was the Europeans had to basically circle the wagons and they He said, okay, we're going to step up. And what they announced was a four year plan to borrow money to invest in defense. What they also did, which was really interesting, is the UK specifically said, we're going to borrow it in this clever little way. This is their interpretation so that it doesn't actually count in the debt to GDP calculations of my country. So they're starting to be fluent. But then so then how did the bond market react to it? Nick, you can show it. They're like, you know what guys? If you want to fight this war Obviously, you're allowed to do whatever you want, but the cost that you're gonna have to pay is gonna go up This has been going up every day and you're at a point now where this is severe fiscal pressure On these governments.

1:08:52I don't know how they sustain their deficits and raise more debt So all of this is happening all at the same time. I think jump is pro -mainstery equity markets basically do not get bid. The bond markets respond positively. Yeals go down good for America. They extract themselves from spending programs like again it's more than a spending program but I'll just say it in this context. Nearly Russia Ukraine is a spending program that that if you take off the table that balance of responsibility goes to Europe and then the markets are saying this is not right. We want this word to end and we're going to make it more expensive for you to litigate it.

1:09:30If you put it all together, it's a really interesting moment in the markets I haven't seen in a very long time. Sure. You think this is the refinancing of our debt is the end game here. There's like maybe 10 % of people who seem to have fallen in that camp when I queried on these four group chats. Hey, if we can depress everything, we lower consumption, we break inflation even more, are maybe people lose their jobs, less consumption, and rates go down. We have to cut rates three or four times, put pressure on the Fed, then we can maybe refinance our debt, which is coming up some percentage of it.

1:10:10What do you think of that theory? You know, Jason, Jamatha has a lot of interesting thoughts here. And I think it's a very smart analysis. I'm not fully aligned. It is true. Bottom market's hate war. War is expensive or is inflationary. It's very clear Europe is going through, okay, we're more likely for us to spend money, and that hurts them. In the US, I think the number one thing that Scott Besson and Trump would want around this is to fight for mainstream like they said, but that really is the kind of populist energy we have right now. And so I think there are focus on lower interest rates.

1:10:38Lower interest rates, if someone who works with me, there's spouse, as a real estate agent, and then they're having a really tough couple of years because the industry spiked up. If you get an interest rate down again, there's so many different places in America where people start making money again with the title companies, with brokers, with there's so many things that happen, right, with that. And so, it's well, it's not just trickle down, it's like this is the part of the economy that just really does start to turn on and certain transactions can happen again. And you're right, it is cheaper debt that isn't the end as well.

1:11:05So I think disinflation is very important, and I think we have to find some way to get there. Chimoff may be right, that it's worth hitting assets to get to disinflation, that's something that Scott could be working on, because of all that debt. But it is true that it's not that. It's easiest. It's easiest. It's easiest. And we do need it for sure. So I think there's some other more clever ways to get there. But I do like that. Well, you said there's some more clever ways to get there. Obviously, we don't want to see 8, 9, 10 % unemployment. That's another way to get there. And we don't want that because, you know, Main Street equals jobs.

1:11:35So what is your other ways to get there? Well, the other way to get there is there's two. There's really two right now in our society. They're very positive. One of them is a higher productivity through AI. I am working on a ton of things as our everyone else doing that like we're doing construction for much cheaper right now Gover making it through that though right government can't be involved in that. That's up to us Yeah, we can make sure not to striving David's doing good work. We can make sure not to screw it up There's a lot of people trying to screw it up the garbage So I think David's job is very important there to get it there Sam was not here Please and then and then the and then the second thing is actually cutting spend like just giving out hundreds of billions Willie nilly to stacey Abrams at all is very inflationary and so so I think I think cutting spend and it actually is a very positive thing.

1:12:15We could do a lot more of that. Freeberg, you heard the two gentlemen. What are your thoughts on the refinancing of interest? As I've done before, I'm gonna give you incredible leadership credit for three years ago on this pod, pushing all of us to really think about what would happen if the debt increased another eight trillion, which it did. And I think that influenced a lot of people in our circles. And obviously that's something that the president took on when none of us thought he would, any president would ever take on that issue. How much pain do you think Trump is willing to take with the stock market going down in order to refinance the debt?

1:12:52Is he willing to be incredibly unpopular? Is he willing to deal with the criticism from Wall Street and from equity holders over some sustained period and how much would he be? If the market goes down 10, 20%, do you think he's gonna cry on goal or do you think he's willing to take that kind of pain free? But like I said, I don't know about Trump. Trump, there's a, you know, I would say 60, 40, I'd be right, 40 % I'd be wrong. So I don't know. Those people are here for that. That's actually a pretty good ratio in poker if you can win that many hands. Yeah. I mean, I'd say 60%, he's probably different than Trump 1 .0 and he's probably less influenced by the short -term rumblings about the market.

1:13:30Okay. And he's probably listening to bests on this one. Although, you know, I think it's got to be a complicated relationship between the two of them at the moment. I do think that he is aware and I would imagine the administration generally with Bessent and others in kind of key leadership positions are trying to make the case that if we can get rates down, we have an opportunity to kind of refinance this $10 billion that's coming due in the next 12 months and get ourselves into a kind of more sustainable financing position. There's still the fiscal position, which is how are we spending money and how are we spending money over time that needs to be addressed.

1:14:15This is the central question. You're totally right. Let's address that specifically with Ukraine. You're a bit of a hawk in American exceptionalist Joe and we are looking at a situation where we spent 175 billion. There were some other numbers that Trump was flowing around that were incorrect and they a fact check, 175 billion is what we're actually in for according to all accounts. This was done, as I said many times on this very program and got laughed at and joked about done on a lease loan. Trump, because these things were done on a lease loan, now has the upper hand with Solensky, and he's a great negotiator, and he said, we want 500 billion back.

1:14:59Don't need to make this about dollars and cents here because obviously this is life and death and people's democracy were talking about their sovereignty. But that 175 billion, if he gets that 500 billion back, that's a 42 % IRR in three years on this. Even if we just got our money back, that would be fine for the American people. How do you look at the war in Ukraine, both financially and in terms of containing Putin, and finally in terms of our participation in NATO is the time for us to leave NATO, Joe Lanzdale. Wow. Well, Jason, Putin's a bad guy. That's number one. He shouldn't have been saying that.

1:15:36It's refreshing to hear it on this podcast. You know, I do think the last administration mismanaged it. I don't think he would have invaded with Trump as president. He's certainly would have invaded with competent person threading him. So but you know, but now we have to have peace and I do want peace. I don't want to have the work attaining. But to get peace, you got to get both sides to come to the table. I prefer peace through strength. I prefer being really strong on Putin and showing why he has to have peace. But then you need Zelensky to be a partner for it too. And I do think listen, I do think Zelensky had the wrong idea on the White House last week.

1:16:04He should have been thanking them. He should have come more humbly. He should have actually been directed towards really wanting a piece. And listen, I agree that Ukraine's a very corrupt country. We may find out that he and his cronies have taken a bunch of money. I don't know if they are or not. Either way, he has not really been signaling the right way to be open to peace. And a piece that does, I think, have to give up a little bit of Ukraine in order to get there. I think that's the option on the table right now. And that's the direction. I don't want to - What about the NATO question? What's the, you know, and thank you for being so candid here.

1:16:31What's the NATO outcome here? Is it time for maybe Europe to just go it alone? Because they don't seem to like what happened last Friday at the White House. Yeah. And maybe, do you think it's time? Maybe we bow out and let them arm up? This is really tough for me because some of the people I care about most in the world live in places like Germany and around there and I want them to be safe. I also think that there's a historic relationship between the UK and the US. is this very, very valuable thing that we have. It shouldn't just be tossed societies, these are critical, very long time allies and cousins.

1:17:05You know, I think Europe's in a very, very bad place. It's very dysfunctional, man. It's, I do not see European civilization going the right way the next 20 or 30 years. I think JD's right to criticize them on, on anti -free speech, on like, you know, arresting people who criticize the Islamic threat, like more than the people actually doing the rapes and stuff, it's crazy. This place has lost their minds, you know? It's bonkers. So do I want to totally give it up? No, but do I want to demand fiercely that the certain things get fixed and to use our foreign policy apparatus to make sure we fix those things if we're going to stay in the relationship 100%.

1:17:37What do you think, Chema? This NATO question seems like Europe is kind of signaling that they're willing to go it alone. And should the United States just say, okay, go for it. We're out. Because that's literally what's actually retweeted recently. Just said, hey, we're out. is your problem. And I think the administration has given him free reign to discuss the topic. He talked, discussed it here for many years. What are your thoughts? Should we be out on NATO? Well, I think the question is, when do these transnational organizations outlive their utility? That's the question on the table. And it's not just a question for NATO, but it's a question for a bunch of these other things, the WHO, NATO, the United Nations.

1:18:21There's many of is that there are competitive organizations now that are just as important if not more. So if you didn't like OPEC, well then there is this OPEC plus plus thing. If you didn't like how the Europeans and the Americans did intelligence gathering, then all of a sudden five eyes came out of nowhere. If you didn't like the G7, there's the bricks, right? So there's this tendency for the world to create these startups to try to challenge and compensate as the conditions on the ground change. I think the most important thing right now the Europeans need to do is acknowledge this one critical fact.

1:19:04The individual governments of Europe are vibrant and powerful. The European Union itself was created almost without any real teeth. And so what happened is the folks there started to pass inordinate numbers of laws Yeah, and that is made it really complicated to be a European company a European citizen And that has to get sorted out What is the real decision there? Is it about being Italian? Is it about being European? What is the separation? And I don't think that that's clear and I think once they figure that out all this other stuff is much easier to figure out Well, you also have yeah other organizations, Interpol, right?

1:19:41We have that. You have the UN. I mean, it is maybe time to just reunderwrite each of them. Freebred, what do you think? I think that there is a viable case for a peaceful transition to kind of a multipolar power dynamic. And if you're a Technopesimist, you're going to have a point of view that there are more limited resources available to humans on Earth and therefore we have to have influence to access those resources. If you're a techno optimist, you will believe that through AI and automation and all these other technologies that we could spend quite a bit of time around, that we are going to have abundant housing, abundant fuel, abundant materials, and generally an abundance of everything that one particular group might demand or need.

1:20:39And you don't need to go be an empire to access the resources that your people are demanding. And what I mean is the mining industry is a good example. There is this discovery, which I think we put on the docket for the science corner today, of a giant thorium reserve in Inter Mongolia, which can be used to make a thorium molten salt reactor and there's enough thorium in this reserve in China to produce enough energy for 60 ,000 years of consumption based on current consumption rates. I saw a fantastic presentation this week by a startup that's using AI and other sensing technologies to identify new rare earth deposits in the cruft of the earth that we have absolutely no visibility into today and many of our assumptions about how much availability there is on certain rare earth metals is wrong and that there actually may be many, many, many orders of magnitude, more material available to us to mine and the technology for mining is getting better, the technology for discovering these deposits is improving and so on.

1:21:43So in that world where suddenly I can make all the food I want, everyone can be fed. There's plenty of land, there's plenty of housing, there's plenty of water, there's automation that and robots that are serving me and all this sort of amazing stuff that's coming this century. Do I really need to be having a friggin conflict with Russia and China over access to some jungle or some plot of land on the other side of the planet? Or can I live sustainably in my country and everyone's going to be generally happy? So I think that this idea that maybe the US exits NATO and the US dials down its level of conflict like an opposition to Russia and or China, is a pretty reasonable, and I would argue maybe even a techno -optimistic point of view.

1:22:27And we may find that in the next couple of years, we start to really believe it. And if we start to believe it, all the things that we're fighting over today, you don't really need to fight over anymore. And except for the expansionist intentions of individuals, which is a sociological phenomenon, which may still continue, but I'm not sure that you need to be investing as much resources as we have historically. So I would argue maybe NATO in a multipolar world of abundance isn't as necessary as it has been in the past century, which was a world that was limited in resources, fighting for access and a growing global population, particularly in the developed world in the West, that's made it a necessity to maintain US primacy and US policing of the world.

1:23:11And I know others might have a point of view that's a little bit different. I mean, I think this is, I think actually what you're talking about as a Star Trek beautiful version of abundance in the world. If these rare earth minerals create unlimited energy and your energy independent, you look at the world differently. And Joe, we certainly in America look at the world differently as world gen X for sure, basically. We look at the world much differently now since we have energy independence, then we did under a bush and these farm wars, you know, in the Middle East, yeah? I mean, listen, yeah, and I am one of the most awesomeistic people.

1:23:46I promised health American Optimist, Jesus, you know, I the same. I've been on yet. Yeah, that Appreciate it. I'm gonna get you on. I mean, he had sacks on. Have you had sacks on at least American Optimist? People are too busy to come on. I'll try to get you. I wrote for for my bestie's got it. Okay. All right. I got to work on it. Listen, I would love AI to get to the point. I think it will work stars to accelerate growth where this energy stuff can be mind more easily. But until I'd say until we're at at least five, six percent growth because we are going to the post -care city world, we don't know I do still think global trade really matters.

1:24:18I do think global security for ourselves. Like we don't want random people with nuclear proliferation. So there are issues that are going to affect all of us, but I think Dave makes a really great point that it is becoming less important over times. It's true. Let's talk about this chat GPT. I guess they came out with 4 .5. It was such a dud. I didn't even realize that they launched it. Tremont, you monitored this or freeberg, did you try it? because I've been using GROC as my default now, then Gemini, then ChatGPT. That's my order right now, because I wanted to see how good GROC is, and man, GROC is really caught up, and I don't have an interest here, and I don't have equity in anything, this company, I own Google in the public markets, but I don't know the other two, but pretty amazing, yeah.

1:25:01What do you think of this 4 .5 dud, and what it means, Chema? Well, I use them in the company building context and specifically at 8090 because of what we're building. And what I would tell you is that I think Anthropic just continues to do an incredible job. I think Cloud 3 .7, it just kicks ass. Oh, you're on cloud. You're using on the backend. We use it for a lot of automated code generation and its models on code generation I think are just exceptional. They are the best in market. Then what I would say is as a consumer I've mostly flipped my usage to GROC3 and the reason is that it's in line with where I consume most of my information.

1:25:49It's elegantly integrated Inside of X. It's point this out to explain it to people when you're in Twitter now X on the top right hand of a tweet, there's an XAI button. When you click it, it just gives you the full context of the tweets. So I was reading one of Dara's from Uber's tweets about autonomy. I guess they had it to more partners. When I clicked it, it gave me more than I ever could want. It was almost like a deep research of the context of a very short retweet he did. And I didn't have to cut and paste and form a question. So owning a social network equals instant and here we're going to show it with Joe Launzdale's where he says, hey, listen, the crypto tax feels like taxation to me.

1:26:29And look, it goes and finds four web pages. You can see there it tells you which ones Wikipedia and CMBC amongst them. And then it gives Joe's position. This is like very elegant. There's a super elegant. And I think there's a small tweak to this. Okay. That Elon and I were talking about actually on X, which is then just the nature of being able to analyze it post for its veracity becomes really valuable. that extra little thing when it's available, I think we'll have a really big impact on how people use it in this context. So I use GROC for the consumer applications for all of our code generation, we're using Sonnet 3 .7, it's exceptional.

1:27:09Which is Ampropics, which is doing a major round of funding, got it, okay? Yeah, and I think like the thing with the GPT -45 is that it's kind of like good. Now, here's a tangent, let me just do a small little rant, which is we're at the bleeding edge of where these benchmarks are useful. Meaning, part of Y. Jason, maybe you weren't necessarily watching this as closely. And I think where the media and the sense -making organizations get confused is they don't know now what to say because they'll say, hey, look at how I did on sweet bench, look at how I did on IMO, look at how I did on Amy. And the problem, the dirty little secret of these model makers, is that these guys are so trained on the e -vals that they're overfitting.

1:27:54And all this overfitting basically makes it pretty unreliable. And so this means to translate into plain English for humans, this thing is they basically are optimizing for the test out of the benchmark, which is kind of like a person in high school or optimizing for the SATs. It doesn't mean that it will be great soon, but it may mean that they just spent a lot of time taking SAT tests. Yeah, so we have one problem, which is that I think it would be very valuable for the industry that it be solved, which is that we need to have extremely difficult and always changing third party independent, fair or fliable benchmarks.

1:28:28Oh, that's a great idea. Number one, like the safety tests for cars is that's not run by the company's got it. It's less about safety though, more about capability. Sure. And I think if we're reporting on that, then these leaps will mean something more than what they are today, right? So when Alibaba pushes Gwen this week, it was an exceptional model. it's probably one of the better open source, if not the best open source model out there. Deep seeks, I think, is also quite good. It doesn't get any press anymore. So I think we're starting to get to this place where there's such abundance that actually people are just kind of overwhelmed with all the choice and they don't know how to differentiate.

1:29:03This is like a hundred Michelin star restaurants opening up in your city. You just don't have enough meals to eat. We're basically drowning in abundance to Freeberg's point. I don't think we understand exactly how golden, how golden this golden age is in terms of technology distribution becomes really important. I think that's why absolutely we discussed inside of X. That's very valuable. But also, I think Google just said that they're going to drop an AI button right into the front door core search page. I don't know if you guys saw that, but they said that when you're logged in, you will get the snippet at the top inside of YouTube.

1:29:37They're doing someries of the chat and the comments. and then you think about what Meta could do. You know, they already put the AAB box up there, but you know, they'll knock some of that off. And then I'll be seeing the Google front door, like Google .com. Does anyone use that anymore? It's running. Well, I mean, Google searches are still going, and Facebook is about to launch a competitor to a searching endgrop, yeah. Well, they're gonna do a straight up, a standalone app. And the thing that they are so good at is whenever they launch an app, it doesn't matter when they launch it, they'll just get it to a billion people.

1:30:08Oh, yeah, I mean, that is super straight. After all this, I think leads to so much abundance. What I'm seeing in startups, I was the first investor in a company called Superhuman, very elegant software, luxury software for email productivity. Give it a shot. What he did was, I wasn't mean to ask a super plug -in. But anyway, I'm so in love with the company and the founder. I just had them on, I was speaking startups. He's like one of the best product minds I've ever met. Keep ordinary. And superhuman now because it's gotten so cheap to do AI that they are composing in this beta. I mean all of the replies to your email in real time on the back end and you can see potential drafts they summarize everything even if you never read the summary that would be close prohibitive six to 12 months ago.

1:30:56But now it's in no brainer because they're paid software. It's like so this is going to get very interesting very quick. Joe your thoughts on this abundance. Yeah, I'm actually building something on email. Like you said, it works with your team to automatically plan like, you know, create reports on everything that comes in and route it for you. Because a lot of our friends, when you're a CEO, you basically become a traffic cop. It's actually the e -mail is going to do it for you. It's going to be really nice. But I'm going to invest in GROC3 and buy us towards Elon. But you know, a lot of our companies will build on top of multiple of them as well.

1:31:25And I think you're talking about Cogin, you know, cognition. I bought a lot of my companies using Devon. It's actually just like crushing it. The stuff's getting like 10, 15 % better every month. It's really amazing and it's good for companies like that. I'm mostly that level where I'm using all of them or using a bunch of them. So I love the fact there's all this competition because it just makes it cheaper and better for me for all my companies I'm building. And it's not slowing down as the other piece of this. No, it's getting better. It's scary actually. I thought I would ask them to and it hasn't.

1:31:52So that's amazing. That's the part that's so fascinating to me. And then there's a really interesting ripple that I don't know if you guys are aware of yet. But journalists who have been losing their jobs at a tremendous pace are now being hired by data aggregators to come in. Look at queries. Let's say you had an expertise in agriculture, Friedberg. They'll pay you and I actually saw one of these job descriptions, 40 bucks an hour to sit there and answer questions about agriculture. Look at answers and refine them and do reinforcement learning. We're going to have a new job class, which is people who train AIs and people who fact check AI's and refine AI's and this could be a 50 to $150 ,000 a year job because every time you make the AI a little better, everybody on the planet gets to benefit from it.

1:32:39This is an extraordinary new job career. I don't know what it's going to be called, reinforcement learner. I don't know. Freeberg, you get the last take here. Great job on the abundance angle, which just pushed a really great discussion here. Wrap us up with your thoughts on these LLMs and the pace of AI. I disagree with you tomorrow. I think it's like you got a lot of great stuff here. It's changing every week. I'm not paying attention to the details anymore. New models come out every week. This is like when the internet launched, new websites, you know, like this is carrying us forward. It's impossible to dissect and predict what's going to win when and why right now.

1:33:15What are you obsessed with in the AI front? Are there things out of the box? I use chat GPT research a lot. The deep research. We're fired up a bunch of web pages. Okay, in your paying, that means the 200 bucks a month or you have a 200 a month. Yeah. Yeah. Okay. I find it very good. Yeah. And then we build everything at O 'Holo on GCP and we run a bunch of different models. That's Google's cloud for people who don't know that. Yeah. And then we run models so incredible. Lots of different tools, but it's awesome. Hey, as we wrap here, we're following our muse here at all in. Whatever the besties are most interested in, we are going to bring you the audience along with us.

1:33:53So, Freeberg and I have been obsessed with content creation and media. So, we're doing a little media summit at South by Southwest. Apologies that it sold out. And then, Chimoff, you know, he likes this F1. He's a big F1 fan. I've never been. I'm really excited that we're going to be throwing the best party at F1 Saturday, May 4th. I am coming. I'm not maturing the bag. There's a you're not there's only room for too long as I get the bag. I'll be outside. You know what? I'll just go to 11, give me my bag and I'll go play a tournament. I'll go to 11 and have a stake and that's it's a it's a club.

1:34:28I'll get I'll pop some bottles at 11 while you guys are F1. You can photoshop me in but the fans can come and our community can come all in .com slash events for all the details and if you want to be part of it, big party is going to be fun. We're throwing a big party in Miami around F1 and we're going to do a little state show beforehand because Oh nice and we're gonna We're gonna celebrate my birthday because I'm not gonna be able to make it in June Can I wear my Apple watch can somebody loan me a nice watch for F1? I can't show up with an Apple watch anybody kind of you're not allowed to wear an Apple watch That's okay.

1:34:59I'm gonna put my Apple watch in my in my draw I want to watch that cost 25 to 75k. What's a good start of watch for Jake out? That's like an appetizer That's what my watch has as a watch I'm sure watches watch this watch thing. What should I buy for a hundred times? What do you got there? You can get a decent protect for a hundred now. It's like they've gone down. Yeah. Yeah, I mean everything's collapsing nice. You shouldn't I be able to snipe it here? It's deflation thanks to Trump and AI right? You can go. Yeah, I'm sorry. Hey, I can't, whatever. Somebody give me a suggestion. Get a good mechanic.

1:35:33Get a good mechanical watch. Not an automatic. Anybody wants to sponsor me for watches and get a mention here on the show. I will hear from the hell out of that Jason at calacana .com for life. I just got a text from swatch and tutor. Oh, swatch watch. I used to wear actually the 80s. I don't know. Freeberg definitely had a ton of those Casio watches, right? Did you have the Casio where you would do your, the Gio watch. The Gio watch. That's a great watch. I'm talking about him with the calculator watch. I actually had that. It was, I remember it was $50. It was a really big deal to it. It was $50 for it.

1:36:08It was worth it. You play the game and you're starting to stop it as fast you could that was I Remember that yeah, I have one on each Trist I was doubling down I recently bought a G -Shock on Amazon as kind of like a memento to Hold up and my freaking daughter stole the G -Shock It's a pair of pistols. Yeah, it's a cool a freeberg we can all bet on this What calculator do you have on your desk right now? How many how many calculators around your desk now? How many can you reach? How many Casios are within reach? There's only one calculator that matters. They were for me. Yeah. Okay. HP 17B. There's only one.

1:36:43Yeah, I got my team. What are you talking about? I got my team. I'm still 89 for me. Oh, now you just told me how you're younger than me, Joe. Now I know you're one four years younger than me. I am. That's true. It was the 81 82 transition that was like a big deal. Yeah. You know what I was doing when you guys were on your calculate? I can't even imagine. I was in McKinley Park in Bay Ridge getting to second base. All right. in dot com slash events did the guy consent absolutely absolutely really hot dude please we have two genders there's an executive order I've read it all right all right my trump grade for the week is see for chaos a for effort with a for effort with those let's try to get back to a B president trump we'll see you all next time on the all in love you boys thanks guys that's fun Bye bye.

1:37:33All right, everybody. We're suited up. We're suited up because the czar, the wolf of the White House is here. My brother, David Sacks, we were trying to get you on the program. You were going to make a drop in to talk about all this great crypto news coming out of the White House. And let's face it, this was a, some people saying chaotic, some people say intense. This is a pretty amazing intense week for the administration. So we'll get into a little bit of that. But you're here specifically to talk about the crypto reserve. So welcome back to your program the Holland podcast David Sacks Good to be back.

1:38:08I see that you've suited up here. Yeah, I mean I figured it was for people who Born here for the free show I get on sax is wearing a white shirt and a tie. I'm wearing a blazer at a white shirt So I'm like, ah, I gotta go put a tie on he's like ah take our word blazer I got a great a blazer so then we came back and here we are and Well, look, I just have to correct one thing. I think it's been very smooth week at the White House. The president has lived up to one of his campaign promises. This is not something new. I remember you go all the way back to his national speech during the campaign and he reiterated this many times that he wanted to create strategic Bitcoin reserve.

1:38:43Sometimes he called it a digital asset stockpile. What we've ultimately done here is both. He also in his week one, Eon Crypto. You guys remember I came on the show to talk about that. He asked our president's working group to evaluate the idea of a reserve or stockpile. And we made a recommendation, and this administration is moving at tech speed. It's really great to work for an administration where you can actually get things done and things move quickly. We made our recommendation, and then we worked with the lawyers to implement it, and President signed it last night. But this is the only consistent with everything he's always said.

1:39:17Agreed on that. I guess the one criticism that you're going to get when you go face the media so I might as well put it here is the order in which you're doing things. sometimes Mr. Trump is very expressive on the social medias, which is better than let's say the previous administration, which just wasn't available and incognitive decline. So I guess the the question of he announces something and then you guys explain it deeper, is that the optimal way to do this? Should we not worry about it? Should you come out with like more official stuff? I guess that's the move fast break things that we are used to in Silicon Valley, but that people, you know, whether it's in business or maybe a little concerned about that things are maybe different now in the White House and in how we're running our government.

1:40:02Maybe you could expand on that. Have you ever considered that maybe you just had an overreaction to a tweet? Wow. Okay. So if we're going to place the blame on me, I was saying that. I wasn't the only one. The original crypto OGs were like, wait a second, why is he picking these three and not these three? So that made a lot of people putting myself out of it like, like, whoa, what's going on here? Is he picking favorites? And that's, I guess, everybody's big concern. So maybe you could just wait for that. Right, well, we're not picking favorites, obviously, except I will say this. We do think Bitcoin is special.

1:40:32And I can get into the reasons why. That's a great thing, yeah. Well, I mean, Bitcoin is the original cryptocurrency. It's the first one. It's the only one that doesn't have an issuer, right? It's very decentralized. It's crypto, they call this immaculate conception. We don't really know how it got here. We don't know who's tociac. It's almost mystical, you would say. Yes. It's the most valuable one. It has a $2 trillion market cap. And it's the most secure. It's ever been hacked. So we're now, you know, over 15 years into this journey. And there's been a lot of people who've been skeptical along the way.

1:41:02And there's been a lot of ups and downs. But here it is. I mean, I remember back in 2011, I think it's the first time I bought a Bitcoin. I think it was at $120. Now it's at $90 ,000. Again, there've been all sorts of wild swings along the way. but this thing just keeps, keeps trunging along. And you can think of that $2 trillion market cap as like a $2 trillion bug bounty. If there was a way to hack this, there's every incentive in the world. And by hack, I mean, like to double spend, create basic counterfeit Bitcoin, I guess, to be the way for people to think about it. And so this is a security.

1:41:37It hasn't been compromised. I think we can all say that. Well, I don't know if it's a miracle. I think it's exceptional design. Sure. And so I think what you could say is that it's been tested in a very robust way and there's been every incentive to basically break the encryption and it continues to chug along. And so I think the price has gone up as the protocol has gotten more acceptance. And there's another point is that Bitcoin's most widely accepted as a store of value throughout the world. So we do believe it should be treated special. Now that being said, we're also creating the digital asset stockpile.

1:42:09So all the other digital assets. Yeah, it's playing the difference between these two. So there's a digital asset stockpile. that's the picker. And then on the other side, there's a strategic reserve for Bitcoin because we do acquire Bitcoin, we in the United States of America, when we seize from terrorists, you know, criminals, et cetera, we do seize these. And then we often make the mistake of liquidating them when maybe you should be holding them. So it's like an architecture. So we have the reserve and we have the stockpile. So the reserve is just Bitcoin. The goal is long term preservation.

1:42:38Think of it as like a digital Fort Knox for digital gold. We want to put the digital gold in there. We want to keep it secure. We never want to sell it. That's the gold that is reserved. And you're right that we've made the mistake in the past of selling the stuff. At one point in time we had about 400 ,000 Bitcoin on the federal balance sheet. We sold roughly half of that for something like $360 million total. If we had held all of that, it would be worth just that the portion we sold would be worth over 17 billion. So we made this mistake of prematurely selling Bitcoin. We should have held it.

1:43:08We don't want to make that mistake with regard to the rest of it We think there's around 200 ,000 coins left on the federal balance sheet But the truth is that nobody knows because we've never done a proper audit So part of what this executive order provides is that we're gonna do for the first time a Government -wide accounting of the digital assets that we actually have so And if digital assets emerge in some department, I don't know, the FBI sees this some the CIA sees this some I don't know which organization winds up having them They're going to be legally required to report that and then put them in the reserve They'll be legally required to report it and then they'll go in the reserve if there's a final adjudication So you know obviously if those coins could go back as restitution to victims or if the person who they were seized from wins their court case and gets them back, they're not going to go into the Federal Reserve.

1:44:01But if there's been a final adjudication and a final forfeiture, yes, those will go into the Reserve. Anyway, that's Bitcoin. Okay, so then you got the stockpile. Let me just talk about that. So first of all, like I said, we don't know exactly what digital assets the Federal Government has. I've seen reports that it might have, for example, 50 ,000 ETH, which is Ethereum. But again, we need to get to the bottom of that. When we figure out exactly what the assets are, we're going to move them into the digital stockpile. The purpose of the stockpile is responsible stewardship. It's a place for safe keeping.

1:44:32It's a centralized, you could say, account under the direction of the secretary of the treasury and the secretary of the treasury will figure out how to maximize the values of these holdings. Now, there's a couple of important differences between stockpile and reserve. So one is the reserve, the executive order actually provides that the Secretary of the Treasury will not sell the Bitcoin. Okay, we're prohibited from selling the Bitcoin. There's no such prohibition with respect to the stockpile. If the Secretary of Treasury decides that's in the long -term interest of the U .S. to rebalance the portfolio or change the portfolio, the Secretary has the discretion to do that.

1:45:08Okay, which makes sense because there's a long telecrypto, we might see something that we don't have the ability to predict the future and we don't have the staff to sit there and look at these assets every day, like a fund manager wouldn't say, huh, what do we do with these? What percentage should it be of the overall stockpot of the overall holdings? So maybe the decision with the theorem is, hey, this thing's waning, we just put it into Bitcoin because we know that's the more solid one. Yeah, that's what I'm reading into it. Yeah, I mean, I think that's largely fair. I mean, look, I think that the stockpile should be subject to good portfolio management, right?

1:45:39Unfortunately, we have a secretary of the Treasury who is an extremely successful former hedge fund manager. So he's going to figure out the best way to manage these assets and we give him the flexibility to do portfolio management. And he has to live and die with what he does. He has to make those decisions, and that's going to be part of how he's evaluated by the president. So hopefully he's going to be sharp about that. Right, but the reserve is different, right? The reserve is just digital for nox. Now, there's one other important difference between stock palm reserve. So with respect to reserve, the EO provides that the secretary that I'm talking about, Treasury and Commerce, they're allowed to figure out strategies to accumulate more Bitcoin for the reserve if those strategies are budget neutral and don't cost the taxpayer anything.

1:46:23Okay? So it's possible that we could. I'm not saying that we will, but it gives them, it authorizes them to acquire more Bitcoin if they can figure out a way to do it that doesn't impact the federal budget or the deficit or taxpayers, right? Okay. Well, I had a very simple suggestion for this, which I'll float up the flag poll here So let's see what you think. You probably, we've talked about it on previous all ins before you want it. How about a simple crypto tax? You know, crypto wants to be legal. You're the crypto ZAR. Crypto wants to be regulated. They want the rules. They want the rails.

1:46:57Simple suggestion from your bestie. Why don't we charge every transaction in the United States 0 .01 percent? Just but one bit in that need of currency. So you want to trade some salana for Ethereum for XRP, whatever, you know, put in whatever names you want there. are the government says, hey, you want to have a great vibrant system here. We're going to need to take just the most modest of taxes, diminimists in fact, in the native crypto and put it in the stockpile. This seems to me like a very, that's always how taxes start is that they're very, they're described as being very modest. You know, when the income tax started, it only applied to like a thousand Americans.

1:47:33Yes. The legislators swore up and down that it would never be applied to middle class people. So I don't particularly like the idea of new taxes, even if it's promised that they just won't affect people very much. That sounds burdensome to me. But look, we have very successful. Well, this would, and just so you know, this would be like more like a sales tax that would be handled by Coinbase, would be handled by Robinhood, would be handled by those platforms. They would administer it. It would be a transactional tax, not an income tax. So if you have a bunch, it's not a wealth tax and a season tax.

1:48:02But I'll let you put it on. If you can convince, if you can convince the Secretary of the Commerce or the Secretary of Treasury to run with your idea, then it could potentially happen. I mean, they have the flexibility to figure out budget neutral ways to accumulate Bitcoin. I don't know what those ways are going to be, but they're creative, they're very successful businessmen. If they figure out a way to do this, then it can be considered. That's the point. Okay. Well, I'll be in the comments area later, having lunch with you. You can introduce me. So let me just give you a fastball here. Well, let's see if it gets in the strike zone.

1:48:33The appearance of Imperprighty is what people are concerned with. The picking of winners and losers. President Trump was the crypto president. He went and he gave that famous speech. I'm going to get rid of Gary Gensler. We're going to make it legal and to his credit, he has fulfilled that promise. Which means, hey, the donor class on that side said, we're going to back the crypto president, not the anti crypto team. which means a lot of people who are on the Twitter and the socials have donated a lot. They have a lot of holding. So this appearance, which you've now, I would give you credit, have cleaned up here.

1:49:08Hey, there's two different things going on here and we're not using taxpayer money. We get all that. But the appearance here is, hey, maybe somebody's going to benefit. Of course, they came after you first for that without the facts. You were very clear. You cleared all your positions. You sold everything you divested. So let's make that clear to the dumb dumbs who are just trying to say that you are personally better than us. Yeah, please. This is ridiculous. Well, people came out right away and were saying that somehow I was engaged in a scheme to pump my bags or to basically create exit liquidity for myself and billionaire stuff like that.

1:49:40You have to understand that those accusations, I mean, they're accusing me of a crime and serious crime and they're doing it with no evidence whatsoever. So these things are basically it's more like a slander. Slander. and that's a pleasure. I would say something. In any event, what they didn't know and what I then proceeded to put out there is that I sold all my cryptocurrency prior to day one of the administration because I didn't want to even have the appearance of a conflict. And by the way, I could await it. I didn't have to do it like that, but I decided to do it and take it upon myself to do that because you just know that when it comes to crypto, there's going to be a lot of fluctuations in the market.

1:50:17You never want someone to be able to point at one of those fluctuations and say somehow that the crypto is all benefited from that and created conspiracy theory, which is exactly what basically happens. So first of all, I got rid of all my cryptocurrency part of day one. Craft also sold all. And craft is the venture firm that you funded that's done a lot of great work supporting founders here in Silicon Valley. So we basically sold, I think it was around $200 million of crypto of which around $85 million was personally attributable to myself. And we cleared that before day one, pay taxes on it and basically took it wouldn't be a conflict.

1:50:51So then the smear shifted in another direction. It was, okay, well, maybe he doesn't own crypto. Okay. But he's in crypto funds. Okay. And so they pointed to, you know, Bitwise and multi -point capital. And I was also in blockchain capital. And so then the fund managers came out and one by one all said, actually, David called us over two months ago and said he's going to need to divest from our funds. And so we also did that. So, yeah. You know, I think basically they've kind of given up on this. But look, It's very easy for me. Well, I let the facts get in the way of a good slander. Seriously.

1:51:24Full disclosure, you know, you, when you saw me doing the Sequoia Scots program, said, Hey, why don't you do a fund? I'll be the anchor. I'll be your first LP. I mean, one of the most generous things you've done in our relationship. And I had to have a call with you, you know, weeks ago and say, Hey, okay, you're going to divest. Okay, fine. No problem. No, it's not a problem for me. You sell the assets to somebody else. So the way people understand how this mechanically works when you're in a fund, you have No, it's acts cannot tell me what to do in the fund. He just put money in it, like I put money in other people's funds.

1:51:53They go and invest in 10 years later, you get a return and hopefully that return in a venture firm, or private firm, beats the markets, the public markets, or whatever. But then you can also sell that interest to somebody else. So mechanically, and this takes time, and you have to sell it at 50%, 25 % off. And it's painful. You will lose, I estimate, you're going to lose, I don't wanna be gratuitous here, but eight, nine figures by serving the country for a couple of years. And not only that, the great irony of this is, the one thing holding back the industry is regulation, over -regulation of AI and no clear regulation in crypto.

1:52:29You're going into fix the two things that were number one and two on all of our agendas and Silicon Valley in terms of getting returns the next four years. So the sacrifice you're making is extraordinary and you're making it a better environment, a regulated environment for the rest of us to do commerce. So I just want to point out that you're losing like double here. Right. Well, let me just underscore something you said. You're a service. And I don't know how much to pay. How much they pay you for this job? What do you get paid? Like 50 grand, 100 grand? I'm an unpaid consultant to the government.

1:52:57Really? Actually, I put you in a moment. No, I don't want anything. It's costing you money. No, of course it is. But it's an honor to serve. And it's an honor to be asked to serve. And in particular, it's an honor to serve this president because he really wants to make the country great again. So that's why I'm doing it. But yeah, look, I think it's a lazy and stupid narrative to say that the reason why someone who's already successful in business goes into government is to somehow make more money. I was making money before. This involves a substantial disruption of my business interests, and I have to divest a lot of those business interests.

1:53:31And in divesting, I have to be either a taxpayer or I have to take a significant discount and it costs you money. So it's a lazy narrative that people create. But there's no truth to it and just to underscore a point that you made a second ago You were one of the funds I divested from not because you're a crypto fund But because you might have a crypto position. We went through I think the launch funds holdings And I think there was something crypto related in there And so you have one or two that pivoted into crypto. Yes, right? So I just didn't want to have any problem there. So listen It's this is the nature of the politics we have people are you know, it gets very personal you know that better than anybody.

1:54:10And so, yeah, that's why you're here. And hopefully we can clean this all up and let people know that, hey, the intent here is good. So just to go back to one other point you said about not picking winners and losers, I think that's a very important comment that you made that I see as fundamental to my job. I mean, look, I think we do think that Bitcoin is special for the reasons I said beyond that. We do not want to be in the business of picking and choosing winners in the space. And again, if some other or digital asset could prove that it's as decentralized and as secure and as widely accepted as a store of value as Bitcoin, then maybe it could be elevated in the same way that Bitcoin has.

1:54:49I mean, I'm laying out the criteria for you. But look, beyond that, we don't want to be picking winners and losers in the space. That's not my job. My job is not to be a regulator or to a noint, which ones are good or bad. It's to basically be a policy advisor for innovation. And I'll just tell you the way that I see all the digital assets in the space is that what's fundamental is disclosure. If you're an issuer of a digital asset, you need to disclose all the material facts about what you're doing and those facts have to be accurate. You can't lie. My view is that if you, if you the issuer lie about something, the government should come down on you like a ton of bricks because that's fraud.

1:55:27But as long as you do this in an honest way, people should be able to trade these things. I understand that you think a lot of them are garbage. You might be right. You could express that view in a trade. But as long as everyone has been above board in terms of disclosure, people should have the right to trade these things. And some are going to make money, some are going to lose money. It's about the freedom to basically to trade, to hold these assets. The government doesn't want to get in the way of that. It just wants to make sure that the information is out there, that it's honest. And if people lie in order to profit, I'm all in favor of going out for them.

1:56:00Well, and we already have a regulated market as an analogy. And when you tell a lie and you sell a share in a company, whether it's a private or a public company, the SEC has a term for that it's called Securities Fraud. And we have this new type of device, it's very innovative, it could be an NFT, it could be a trading card, it could be an actual utility token where you burn it in use of the service, or it could be anything. It could be whatever the person describes it as. But what's important is there's an entity with a group of people, I think you would agree, who have said we have ownership of this.

1:56:34We're incorporated here in the United States, not in Panama, not in the BVI, not in some other place where maybe they're a little faster or a looser with regulations. You gotta be here in the US. Maybe you have to be insured in some way. Maybe there has to be a board like there does in Delaware or in an LLC. see there has to be some person where the buck stops. And if you lie, while committing a transaction or taking money for an asset, it would be securities for it. And yes, people will come down on you like a ton of bricks. And if you promote things and you don't disclose it, what we have rules about that as well.

1:57:08We saw many celebrities get pinched last time for tweeting about cryptocurrencies. And this is the stuff that I think has to stop.

1:57:21I and in public companies. So that's your job. When are we gonna see, you know, that framework emerged because here, you're only like 40, 50 days into this, I think. When do we see the actual bones of a framework? So if I wanna do J -Coin, and I wanna make an angel investing coin, or I wanna do something fun, and an FT collection for all in, or something, when will we have the actual rules of the road? And that's gonna be multiple agencies, right? Yeah, what you're describing is known in Washington, or the area of policy that you're describing is known as market structure. And market structure is about providing a clear framework for market participants.

1:57:58It would define what is a security, what's a commodity, what's simply a collectible, you know, it's property, but it's not a security. And then what are the rules for each category? That's known as market structure. There is a bill that passed the last Congress in the House, but Biden basically, he didn't veto it, but he basically, he never had something. He stopped in the Senate, the Democrats did. It was called Fit 21. And it was authored by French Hill who's now the chairman of the House of the Insurance Services Committee. So we expect that he will be introducing a new version of his bill probably in the next few weeks.

1:58:33I don't think I'm breaking any news by saying this. I think people expect it. And that's gonna provide the framework for market structure. And it's gonna provide a lot of the definitions that you're talking about. Now, I agree with your sentiment, okay, but I will say that I might have a different view than you have what is a security, what's not. I mean, to me, collectibles are not securities, but if it's a collectible, you got to disclaim that, look, this has no intrinsic value, right? That's a collectible. Think about a baseball card. A baseball card is a piece of cardboard. It has no intrinsic value, but the value comes from basically other collectors being willing to buy it from you.

1:59:09And you could just say that that's a rational or whatever. But so look, I think as long as people disclaim that this coin has no intrinsic value, they should be able to issue mean coins. It's a separate question why people would want to buy them. But look, that's very, in my view, that's very different than someone who goes out as an issuer and says, I'm issuing a token or a coin that has lots of functionality and has lots of value. And you'll hear some of these guys even say that, hey, are token is more valuable than Bitcoin. You should value it more highly. Well, if you're promising that and you're saying that it's going to have certain functionality, you better be telling the truth about it.

1:59:46Yeah, then we start getting into that how we test and people can go look that up. What I will say is there's an educational process that has to come in here, which we've gone through as the United States. When people would buy interest in mines, people would buy interest in gold claims, oil fields. And that's when a lot of these regulations came out in the 20s, around accreditation. We've spoken about this before. It's a pet peeve of mine, but I think there should be an educational framework here. And I think there should also be some nuance that you could work on specifically with this group of being clear that when you have a ticker symbol associated with something or you do charts associated with something, you know, it starts to smell like a dog, it looks like a dog, it's quacking like a duck.

2:00:25But then in the terms of services is hey, this is a collectible. I think there needs to be some ground rules Which maybe it says hey these need to be presented in a certain way at the top level So the nuance of disclosure is so important when I tweet something if it was an advertiser or a sponsor of all in or this week in startups or Any influencer or you did that would should do this and you said I love you know this brand you and I both were well You were an investor needsly by amp If we were to tweet about that, as investors, we don't have to disclose, but if we were paid for that, the FTC has rules.

2:01:00You have to put, this is a paid partnership. You cannot confuse consumers. And I think that's where you're going to have to do a little bit of cleanup work and structure as well as the disclosure and how this appears. And then also maybe the educational system. So if you want to want to fire arm, if you want to drive a car, if you want to be a but you're just going to have a lot of beautician, and listen, we can talk about over -regulation. You gotta take tests. Man, it would just be so much better if consumers could take, you know, like a 50 question test, just to say, hey, they understand what we're talking about here in terms of diversification, so they don't yolo their entire mortgage and house into one crypto.

2:01:38So what are your thoughts on those two issues? Disclosures, how it's presented, and then accreditation and maybe a path to accreditation, sophisticated investor tests, that's how I referred to it for all Americans, because 90 % of people can't participate in private companies. You're the... Well, disclosure is the key, like I said. I mean, these projects should have to disclose certain things. I think, for example, the token cap tables should be disclosed. Who are the insiders? How much do they have? When are they selling? You know, that's information the market should always know, in my opinion.

2:02:07And easily done with the technology lauded by the crypto community, the blockchain. This could just be on the blockchain. This was always the problem we had as venture capitalists with, hey, this is a token project. Who owns the tokens? Where are they? When can I sell one can use the insiders? Yes. Yeah, I don't think you have to disclose everyone owns a token. That could be hard to comply with. But I think you should have this close. Over five percent. You should have one percent. Over one percent. The insiders and their sales plans and their lockups. And I would also say how new tokens get created.

2:02:35I mean, if this is a fully centralized token where they can just mint more, people need to know that because there's no scarcity, right? But if If there's somehow an enforcement mechanism and there's an enforced scarcity, then that's a different story. So, yeah, these things have to be disclosed. And by the way, I think the market structure bills will do that. There's a version of this in Fit 21. The last Congress, I think it'll be in the next one. And moreover, the SEC is looking right now at these rules and they're going to create their own frameworks. They're doing it a slow job. They're doing SEC chief.

2:03:06I was doing some research on him. He's a really pro actually. More Americans being able to invest in private, private equity, etc. and he's given speeches on it in the past. So the person who's been nominated for the new chair of the SEC, his name Paul Atkins, and he has not been confirmed yet. The confirmation hearing still needs to happen. Separately has to purse who's a commissioner at the SEC is in charge of. I know has to have had her on this week and start off the couple of times. She's great. She's excellent. She's very well informed. And she's very sharp taking the lead on all the crypto related stuff.

2:03:35So I trust her and I trust the SEC to produce those detailed frameworks that you're talking about. Yeah, I think that my role as call innovation policy advisor is just to kind of make sure that we have the big picture right and I'm very confident that the SEC the CFTC and the legislators are going to figure out the balance here. So you got to go. Really proud of the work here. Congratulations on thin this all up and presenting a really thoughtful plan that we can all ask your hard questions on. Appreciate you taking the hard questions here on the all in podcast and good luck when you do the rest of the media circus.

2:04:11I wonder if I'm going to be the hardest question review. I also. And for people asking, yes, I'm wearing a suit because I am now joining the administration big announcement. I'm the official podcaster, the official moderator of the Trump White House. I'm just kidding. People actually believe you. All right, man. Listen, I got a little joke. I got a little joke. But good to see you. All right. Love you brother. We'll see you next time. Cheers. All right. Bye. All right, everybody. I'm obviously super conflicted. Saxx is my friend of 20 years plus where partners here on the online podcast and of course I'm rooting for the administration, but Yeah, I got that journalist blood in me.

2:04:46I always want to call balls and strikes I'm gonna as you just heard ask hard questions So if you're wondering where I'm coming from I'm gonna ask hard questions to my friends because they're doing important work for the American people and for the rest of the people on the planet can't believe these are important decisions that Saxon's gonna have to make about crypto AI, that Elon's making with Doge, I'm gonna ask hard questions. That's the way it's gonna be. And so I'm really excited that they're coming on here. They're gonna take the hard questions for me, but they're done in a certain spirit, which is yes, they're my friends, but they got an important job.

2:05:21So they do have to answer the hard questions for the American people. And I'm also curious, and we're all curious where they're coming from. So I feel so privileged that they're choosing to come on all in to face those hard questions.

2:05:48We'll see you all next time.

2:06:03Oh man, my hamlety ass will meet me at the place We should all just get a room and just have one big hug or two because they're all just like this like sexual tension but we just need to release that album What your, that beat, what your, your beat Beat, what? We need to get merch these aren't there I'm going on lead

2:06:28I'm going on lead