451 The US Economy Counter Factual, How to Make Your Kids Rich & More | DisruptTV

0:00Thanks for pressing play. This is Christopher Lochhead, Follow You Different, and I'm your host. And we have an extra special episode for you today. You see, recently, last Friday, actually, I was on Disrupt TV with the legendary Ray Wang. And Ray, as you probably know, is the founder, chairman, and CEO of Constellation Research. And many, including myself, call him the greatest tech analyst in the world. And we have a fantastic conversation about a couple of key things. Number one, we are being fed one perspective on the American economy by most mainstream media outlets. And they're really misleading with the truth.

0:43And so we unpack some other things going on in the economy that send a very different signal, particularly the fact that most people who are betting on the future are now betting there will not be a recession in the United States. And we are at record highs for new company starts. And we talk about a whole bunch of other things as well that I think you're going to find fascinating. You're going to love everything about Ray. And I know you will because I do. Now, there are two ways to make a living with your mind. You can either sell your intelligence by the hour. That's called being a knowledge worker.

1:18You can make a good living, but there's a hard ceiling and you only have so many hours to sell. Or you can build your own intellectual capital, scale it with AI and sell it while you sleep. That's what's called a creator capitalist. And in every issue of Category Pirates, it's about making the jump from knowledge worker to creator capitalist to gaining agency. while creating legendary new things with AI. So if you're ready to thrive in the AI future and become a category of one, go to categorypirates.com and subscribe because different beats better. Categorypirates.com. Now, here's Ray Wong. Hey-ho, let's go.

2:18All right, welcome to Disrupt TV. Of course, this is Bray Wong. And of course, this is our episode on category design, future of Brad Gerstner's accounts, the human edge in the 25th hour. And we're going to kick it off with the legendary Chris Lockhead. If you haven't met Chris, Chris is the father, the godfather of category design. But even more than that, he's got the number one long form podcast on Apple. And more importantly, he's one of the biggest thought leaders in terms of where marketing is headed and where marketing is going to be. And more importantly, if you haven't met Chris, there is no sense of lack of passion.

2:54It's all about what's in it. It's all about living in the moment. And more importantly, it's all about thinking differently. So with that, I'd love to introduce my friend, my dear friend, Chris Lockhead. And of course, this issue, this episode is also about Liz Miller. we love you liz we miss you uh okay so a couple things right first of all thank you for that wonderful introduction uh two things we want to talk about today number one the recession that is not and number two the greatest way to change the wealth gap in america that nobody knows anything about or almost nobody knows anything about okay so let's go to the first topic all right for the last four years or so the donkeys have been saying we're in a recession a recession's coming, there's a recession, there's a recession, oh my God, this number, that number, there's a recession.

3:40They've been wrong every time. And right now, Ray, as we speak, there are donkeys on LinkedIn doing webinars right now about, get ready for the coming recession. Is there a recession, recession, recession? Okay. I want to go through some data to show just how wrong this thinking is. First of all, I don't know why this isn't in Wall Street Journal every day. Right now, Americans are starting new companies at a record pace. More than 5.6 million business applications were filed in 2025 alone. And we are now at over 400 ,000 new companies being started a month in the United States. It has not been this high in the modern era.

4:29This is the greatest time right now to be an entrepreneur and the proof is in the data. The second thing, go ahead. No, it's crazy. I mean, 470 ,000 new businesses a month. This is wild, dude. Keep going. Yeah, 5.6 million new businesses last year. Here's the other interesting thing. If one of the metrics that is a harbinger of what's going to happen in the future for a company of our country is how many new companies are being created. So by way of contrast, Canada loses more companies every month than it creates. So they are on, they have a ticking economic time bomb and the United States is creating almost half a million new companies a month.

5:17In addition, right now, in spite of what you're reading in the Wall Street Journal, Layoffs are at historic lows. GDP is still growing, not by a lot. It was only 1.5 % in the second quarter, but that still grew. Inflation is actually down from May. In May, it was 4.2%. Now it's 3.5%. That doesn't get much coverage. And here's the other thing that doesn't get much coverage. Initial unemployment claims have recently fallen to their lowest level since 1969. nine. Further, the donkeys on LinkedIn are saying there's a recession coming. Let's look at what people who are putting their money where their mouth, what they're doing.

5:58The prediction markets, they do not see a recession. As a matter of fact, the odds of a U.S. recession by year end on Calci have gone from 28 % in April to 4 % to 5 % today. Polymarket, 30 % chance of recession in April, 10 to 11 % today. So the people who are putting their money where their mouth is are saying, we don't think there's a recession company coming. And the donkeys on LinkedIn and the clickbait fucks are trying to convince us that a recession is coming. When in point of fact, America is building today like it never has. I'm not saying the economy isn't perfect. It is not perfect. Most people don't realize between the Trump administration and the Biden administration, we let those people print 50 % more money.

6:49Of course, there's going to be massive inflation, right? We've seen consumer prices go up 29 % through June, 2026. So I'm not suggesting the picture is all rosy, but what I am saying is these donkeys who say there's a recession company, a company coming, excuse me, are not telling you the real story. That's what's going on with our economy and there is no recession coming. Don't believe them. Keep building. Well, take a step back. You're right. We're hitting AI inflation. We're definitely seeing that. But we got the jolt number this morning and it showed that 23 ,000 jobs in July were lost. But we've got an unemployment rate at one level and we've got a jolts and jobs report at another level.

7:34We are in transition. The question is, what does that mean? well like any economy in transition right we are moving to the ai economy uh david sacks who's our former now now former uh ai is our a buddy a great guy and i'm really grateful that he did what he did he says that uh gdp growth now in the united states about a 75 percent of it is coming from ai right and we all know that all of the growth has come from the mag 7 and the s &p 493 here's a thing that will blow most people away. The S &P 493 spends exponentially more money on stock buybacks and dividends than they do on new innovations, new products, and new categories.

8:20All of the job growth comes from new companies, comes from smaller companies. And I think one of the reasons we're seeing such a breakthrough in new company starts is the shift from knowledge worker, two creator capitalists. One person, two people, three people working together today with AI. We have a three-person education in media business at Category Pirates. We execute like 30 people used to execute. This is happening everywhere in the economy. And so creator capitalists are saying, look, it's not about applying existing knowledge. AI does that almost for free. Creator capitalists are saying, how do we leverage AI to create net new value, new products, new services, new categories.

9:02In some cases, they're doing that with inside companies. And many cases they're saying, F you to the Dilbert life. And I'm going to go out on my own and create my own company. And so we all love you. We all love tubes, man. Does anybody wake up in the morning and go, hey, man, I can't wait to get to my cube. Things you've never heard. All right. I also want to talk about these Invest America accounts. But before we do that, before we do that, I want to jump in on this AI economy, right? We're seeing tiny teams and you're knowing that, right? These are, go to tinyteams.xyz. 10 people companies doing 100 million, 100 million in revenue.

9:3920 person teams doing 200 million in revenue. So you're absolutely right. We see a thousand person company taking out companies like these big SI companies. We think a hundred person company could take out a big software company. And we're about to see a single individual do a billion in revenue on their own. Isn't that crazy? It is absolutely coming. We've been talking about it for a long time, you and I. It is absolutely coming. I also, I'm trying to grab a piece of data as we're talking. We just did this, a piece on this. Yeah, here it is in category parts. Get this. There's a guy named David Fox.

10:15And he was the CEO of the largest law firm in the United States of America, Kirkland Ellis. And they were the first law firm in the country to cross$10 billion in revenue. he was the ceo he left and he has started a new company with ai at the core instead of bolting ai onto an existing law firm he started a new law firm let me get the name here it's called

10:47irving irving is it irving irving there it is irving yes irving yeah he is he is betting that he doesn't need 5 ,000 talented people. He needs 20 with AI. And so he's creating an AI-first law firm. The CEO of the largest law firm in the country left to create a startup with 20 people in AI that he thinks maybe can rival his former employer. Whether he's right or not, it's powerful signal to be paying attention to. Yeah, no, and he was at the legendary firm Skadden before Kirkland and Ellis. That's right. And the guy has that. We've got Harvey Law coming up, you know, Harvey AI. If you watch Suits, that's what Harvey AI is built off of.

11:29I mean, it's pretty wild, dude. So we're seeing the professional services market completely get upended, which is changing it. And I do have to ask you this, right? AI is driving new category design opportunities. I mean, these are frontier companies. I mean, they're creating their own categories. What do you call this? What are we in the middle of here? I mean, I call them AI first, AI exponential, but you probably got a better name for these. No, AI Exponential, I think, is a great name. And here's the thing, right? Every new category creates new categories. And the more consequential the category, the more new categories it creates.

12:04So yesterday was the 35th anniversary of the launch of the World Wide Web. 35 years ago, yesterday, August 6th, Tim Berger introduced the World Wide Web. Okay. And we did a little bit of research around here. I don't have the data in front of me. Maybe you could look it up. But I believe today the internet is roughly 15 % of global GDP. Maybe you can double check my math. That's what I remember. And so we have a technology that terrified people. They're afraid they were going to get put out of business. They were afraid there was going to be terrible job losses as everybody replaces sales and customer support with websites and all these things, you and I were there for the buildout of the internet.

12:50As a matter of fact, you and I had something to do with the buildout of the internet. Well, here we are again today. And all of the bluebirds and donkeys are saying all of the same things that they said in 1996. They were, the Luddites are always wrong. They were wrong then, and they will be wrong again now. And we are in a transition period. And the people who acted on the internet, like you and I in the 90s, were able to build legendary businesses doing that. Whenever there's a bifurcation and there's a massive new technology category shift that is going to create literally thousands of net new categories, just like the internet did, only exponentially more, this is an opportunity.

13:32There's two kinds of people who look at this kind of thing. There's the kind of people go, oh my God, what's happening? I'm going to get under my desk and tear by myself and freak out and hope I don't get laid off. And then the others ago, hmm, there's a giant opportunity here and I'm going to go for it. And we all have that choice right now. And well, this takes us to the point, right? We're in a situation where we've got democratic socialists. We've got people saying capitalism sucks. It's not going to come back. There are people that are disenfranchised. People feel like they're missing out, right?

14:03And you're talking about these investment accounts that are here to actually bring people back in to get a piece of the commie. Jump in here. First of all, capitalism wins, period. Capitalism is the fairest, most powerful paradigm created to harness natural human instinct and interest for the betterment of the world. That's what capitalism is. Is it perfect? No, it's not. And the last thing we want is freaking socialism. All right, so let's get to these Trump accounts. There's a lot of discussion about the wealth gap in the United States, and there should be. It is a problem. And there's two ways you can think about solving it.

14:44The way that we have been taught to think about it primarily is, oh, the billionaires have too much money and the poor people don't have enough money. So we need to take money from them and give it to them. That's one idea. And that's the prevalent idea. Here's a new idea pioneered by the legendary Brad Gerstner and put into policy by our current administration, regardless of what you think about them. The idea is this. Imagine every child in America, when they're born, they get$1 ,000 from the government, the federal government, in a protected account that they can't touch till they're 18. And that account grows.

15:26It's invested. There's nobody making decisions. It's invested in an index fund. And anybody who knows anything about the index funds knows the following. The S &P 500 for the last 70 years has grown approximately 10 % a year. Go look it up yourself. Okay. So all you do is invest money in the S &P 500 from the day you are born. You will be a multimillionaire. Okay. So the way you fix the wealth gap is not by giving people fish. It's by teaching them to fish. So now every child born today in America, if their parents will apply for it and you can get it on your app store, on your smartphone, you will get$1 ,000 from the federal government.

16:09But here's the most important part. On top of that$1 ,000, every year you can gift to your child and or your friends and relatives can gift to your child up to$5 ,000 a year and get a tax break for it. And then that will grow. And the math looks like this. A child who is lucky enough to get$5 ,000 a year from family, friends, and parents from zero to 18, given the compound growth rate of the S &P, will be worth roughly$250 ,000 on their 18th birthday. That is huge. So you mean this is the eighth wonder of the world? You heard about this? well i don't know if it's that but it's listen the power of compounding investment is something that is widely misunderstood albert einstein of the world albert einstein said that was the eighth wonder of the world compound interest well i agree i agree with uh mr einstein um now here's the thing i also want to say about these accounts they have been widely unreported in the broad media and social media.

17:19And here's why. What's going on? We have a president right now whose approval ratings are in the mid-30s-ish. There's a lot of people who don't like Donald Trump, and there's a lot of people who have Trump derangement syndrome. And our current president loves to name things after himself. Himself. Yeah, it doesn't help. Yeah, it doesn't help at all. This program is actually called the Invest America program. However, in order to access it, you have to on your smartphone search for trump accounts that's what they'll be called really he called them trump accounts and so the mainstream media is not covering this because they're not big fans of the president i live in a very very democratic area where's that man where do you live the bay area in santa cruz county which is one of the most left counties in the country creep.

18:10And I've asked approximately a dozen parents about these accounts since they came into law. They came into law on July 4th. And at least where I live, not one had even heard of them. So, A, I'm asking you to educate yourself on this. It's very simple. If you have a new baby, you will get$1 ,000. Even if you don't, even if you have a 12-year-old, you can set up one of these accounts and start investing today. Now, this is part of a bigger new category of charity. The biggest problem with charitable giving is it's giving. Yes. This is what you could think of as charitable investing, the difference between giving fish and teaching people to fish.

18:59And what Carrie, my wife and I have said to all the folks in our lives who have children under the age of 18 is we will donate. We will give a thousand dollars to your child's account if you set it up. And I just had this conversation with one of my close friends, a guy named Mike. And I said, and here's what I'm doing, Mike. I'm in air quotes, forcing you to teach your kids to invest for the long term. And I am buying the right when your 12 and 10-year-old are 14, 16, 18, 21, 25, et cetera. I, their crazy uncle Christopher, am buying the right to sit down on an ongoing basis with them and teach them how to shift from being not just workers, but being owners.

19:52And this new program makes every child an owner in America from day one of their life. And again, if you have a child under 18, regardless of how old they are, you can put up to$5 ,000 a year tax-free into these accounts for your child. And again, not only will it compound, but you will buy the right to sit down with your kid, explain how compounding works and that if they follow this path, they will retire multimillionaires. The dream here is to make every American a billionaire plus, and it will happen if we all do it. And I'll finish on this, Ray. We've learned over the last handful of years about the massive malfeasance, corruption, and mismanagement in nonprofits, be they international NGOs who have been exposed for supporting terrorists or whether they're right here in America and they're huge homeless frauds.

20:48We just discovered in our county, homelessness has gone up 12 % year over year, and we spent more money on homelessness in our county than ever before. This must stop. And the reason it's a problem, there's a middleman, and that middleman is ripping us off. The beauty of charitable investing versus charitable giving is we make an investment in that child's future. That child can't touch it until they're 18. Nobody gets to grift off it. It's an index fund. Period. So you're telling me in 2044, there's going to be a spending binge like we've never seen before. Well, I sure hope so. And I actually.

21:26In 18 years. I mean, these kids are all going to blow it all like on a trip. They're all going to be worth a quarter million dollars if we get it right. Yeah. I mean, that's pretty wild. Okay, we can't do this without talking about Michael and Susan Dell. So Michael and Susan Dell, we all know who they are, legendary entrepreneurs and very laudable people. And I don't know all the specifics, but here's what I do know. When Brad Gerstner told Dell about this and when Trump told Dell about this, Dell decided, Susan and Michael, that they were going to do something legendary. and they made the largest charitable investing gift in American history.

22:06Do you have the number in front of you, Ray? I don't know, but it's$250 donation per kid. I'll have to look it up. Let's take a look here. It's billions. It's billions. 6.25 billion. 6.25 billion. And every child is$25 million American. 25 million american children age 10 and under will get 250 to get the party started from michael and susan dell and god bless them for doing that this is how we teach people to become owners yeah and and how to give back this is the right way to give back this is investing the way we want to give back and the point of my hope is really well so my hope is this paradigm this new category of investing, charitable investing, moves into other logical sectors.

22:52So for example, there are charities out there that help various types of people for one reason or another buy a home. Maybe they're veterans who are down on their luck. Maybe, God forbid, they're the family of a veteran who died in combat serving our country or a first responder or somebody along those lines. And so there's charities that are set up to buy them homes. That's a wonderful idea. You know what I'd rather do? I'd rather write a check to a charitable investing fund for people who qualify so they get the money directly and they can only use it for a home. Yeah. And so what's my point?

23:29I believe that as more people understand the power of charitable investing, that you give a gift that compounds and teaches somebody how to become an owner, how to get up in life. That's the powerful way to give because you're building something as opposed to giving them fish for a day. And so I'm hopeful that we will see more and more applications of this new category of charitable investing. It's direct. It's peer to peer. We disintermediate the NGO who maybe they're good people, maybe they're evil people, but they do add cost. And if you and I can give directly to people who need it in a way that will compound and build for them a future, not just solve a temporary problem, this is what we want to do.

24:23Kerry and I are moving half of our giving into this paradigm. Oh, that is awesome, dude. I mean, I think it's a great place to do that. We're definitely saying. And listen, one other thing. If you are somebody who's Democratic, votes Democrat, listen, please don't be that idiot. I know you don't like the president. He's out of here in two years, okay? Your children are not. Whether you like him or not, this is a good thing that he did. Thanks to Brad Gerstner. Thanks to Michael and Susan Dell. Okay? Take advantage of it. I know they're called Trump accounts. I know you don't want to download that shit.

24:56I don't care. I want you to inspire with us. Invest in your children. Invest in your children. Wealthy. No, invest in your children. That's pretty good. Well, hey, look, you interview some great people. Let's take your political line here for a quick second. We got about a few minutes here. Lee Carter, you're talking about persuasion. What was going on with that? Tell us more what you learned from Lee Carter. So Lee was just on the podcast. She is unbelievable. She's one of the top pollsters, researchers, campaign PR and communications leaders. in our country. And so I had her on the podcast to talk about, you know, what does she think is really going on here in the midterms?

25:37And here's essentially what she said, that right now, both parties are sort of getting their, marshalling their resources. And she thinks that the real fight will start on September 1st. That makes sense to me. Here's the interesting thing, or one of them that we talked about. If you look at what's going on right now in the Democratic party. What do we have? We have an ultra left wing militant movement called the Democratic Socialists of America. They're just they should call themselves the communists of America, but that's really what they are. Right. And we're now seeing there's approximately 250 DSA aligned candidates who've been elected, including Karen Bass, the mayor of L.A., right, who is up for reelection.

26:23Oh, by the way, there's fires in L.A. So aren't we glad Karen's still the mayor, but I digress. And so the Democrats are not beating back the Democratic Socialists. Barack Obama has been publicly photographed with Mamdani, who Mamdani is clearly the largest success story so far of Democratic Socialists. And the Democrats are yielding to this far left wing group. These are people who want to get rid of the Supreme Court. get rid of three branches of government. These are people who want to defund prisons, defund the police, open borders, et cetera. I mean, it's a very, very extreme agenda, and they're being supported by our former president, Barack Obama.

27:14Schumer just came out in support of them, even though they said they want a primary Schumer and get rid of them. He's still supporting them. So the Democrats are terrified by this ultra left wing group now here's the interesting thing the republicans went through this approximately 15 years ago yeah with the tea party and whether you like trump or not there's a lot of things i don't like about the president but one of the things that he did that is forgotten about is at the time the republican establishment could not tamp down the tea party the tea party was overthrowing the Republican Party from within.

27:52Trump showed up. He figured out a way to embrace them on the stuff that he agreed with and tell them to go F themselves on the crazy stuff. And he unified the party. So here's the question. Not only are the Democrats not doing that, they're beginning to yield to the people who want to defund everything that we hold dear. And so one of the things that Lee and I talked about is, is there going to be a massive black swan candidate that shows up on the Democratic side that will have the power, the position to blow the donkeys on the far left in the DSA away and unify the party the way Trump did with the Tea Party?

28:39And there's lots of speculation about who that could be. And I'll just tell you, we talked about a couple of them. Could Oprah be getting ready to run? Could George Clooney be getting ready to run? I know many people in major positions in the Democratic world, major donors. And I can tell you, they are looking for a black swan candidate that could come out of nowhere and crush most importantly the democratic socialists and then of course because if you don't beat them you don't get to beat um the republicans whether it's vance or whether it's rubio and according to lee right now she thinks rubio's in the in the lead regardless right now is the time think about it we have a very unpopular president we have a very unpopular war and the Democrats should be mobilizing, moving to the center, recruiting independents like me, like you, recruiting Republicans who are not crazy rightists, right?

29:49And saying, listen, we are not nuts. We believe in the same things that you do. Tack to the center. Who's going to win is the not crazy people, okay? And the crazies on the right. Lockhead for president, lockhead for president. Crazy is on the right, almost destroyed the GOP. And then Trump came along. You could argue he destroyed the GOP. If you hate him, if you love him, you could say he fixed it. Regardless, he got rid of the Tea Party and he did unify the GOP. That now needs to happen. And Lee and I talked about this. Right now, it does not appear there is a Democrat who can do that. No, we actually think the moderates might actually join the Republican Party.

30:32and you actually see a split or you end up in England where you have center left, center right. You have far left, far right. And it's going to be crazy. I mean, it could go down that way. Fetterman is the sort of kid area in the coal mine in this for me, because Fetterman's policy positions are very left leaning, very left leaning. And he's one of the few and he's arguably the loudest on the Democratic side saying, listen, I'm not going to be in a party with these freaking terrorists with these people who are tearing down America. Go read it. You can go to the democratic socialist website right now and you can read their manifesto right now.

31:07They want to defund the police. They want to defund prisons. They want to open the borders. They want to get rid of the, the, the, the, the, the branches of government. It's unbelievable how radical their agenda is. And yet Barack Obama is propping them up. We need a Democrat who's a big name, big power who's beloved by the american people who is a centrist who can smash the insanity on the far left down and tack to the center people will forget right right the last president to balance the budget bill clinton bill clinton you got and look hey forget lewinsky and some of the bullshit that went on the clinton gore administration were pro-technology pro-entrepreneur pro-growth pro-Silicon Valley.

31:55And despite all the jokes made about Al Gore inventing the internet, the reality is, and you and I know, we were there. We were part of it. The policies of the Clinton administration helped in a material way to make the United States the internet leader. Just like I think right now, the policies put in place by Sachs and Trump are helping to make us the leader in AI. I need you to interview Sachs at a conference that I'm throwing in March. I'll talk to you about that later i would love to do that but but here's the thing um if bill clinton were running for the uh candidacy uh for the democrats right now he wouldn't even get close he is he is far right by today's standards no i completely agree we're actually a very different thing and i love this it's going to be interesting to see how the midterms play out whether this actually pulls off or not but that was a fast interview with leet the democrats the democrats should be crushing the republicans right now if it weren't for the wackadoo left who wants to open the borders and the prisons the democrats would be in position there would be a blue way the president is very unpopular this war in iran everybody thinks it's gone on too long It's not popular.

33:15Even with Republicans, it's not popular. And so right now, the Democrats should be crushing. It's not clear. Most people think they're going to take one of the two houses. We'll see. The Senate of the House, we'll see. Probably they will. Is there a blue wave coming? No. And the reason the blue wave is not coming, it's got nothing to do with how legendary the GOP is. It's got everything to do with the fact that the centrist Democrats are yielding to the maniacs on the far left. And that is very, very bad. I want strong Democrats. I want strong Republicans. And I want them arguing over the things that matter as opposed to what we have now, which is a massive increase in Jew hate, a massive increase of America hate, and a public paper from the The DSA that says they want to tear down everything that we spent the last 250 years building.

34:07Hey, Chris, we've got to run. But this is, you know, definitely hot issues. The accounts, the investment accounts, what's happening. Please, I'm begging everybody, set up your accounts for your kids, please. All right, Chris Lockhead, 13-time number one bestseller, co-author, number one. What? This is amazing business. dialogue podcaster, long-form dialogue pastor, creator of Category Parts, best known as the godfather of category design and the author of many, many, many, many books. So, hey, thanks for being on the show. I'm going to sync up with you on Burgers and Beer and Heist to Liz Miller, of course.

34:44Yes, sir. Beers and Burgers, you know where. Let's do it soon. See you in Los Gatos. It's good.