AI Is Crashing Stocks | Ep. 048 Lemonade Stand 🍋

20:07So every day I have five things I want to do. They're not these five things, but it's... And as I click them off, it fills up this little bar and then it goes green. And at home, I literally have this. And it's like, some days are red, some days are green, some days are yellow. I bet it's a lot of red for you.

20:20Aiden:No, it's not a lot of red. But it's a lot of red. And when I see a red, I'm like, I got to get back to the green. And it has helped me. It's just a fucking...

20:26Atrioc:Do you redact sections when you don't complete it? What do you mean redact? Like you block them out when you're sharing the results with your friends? I haven't shared them. No one has seen the results. I just feel like we should get the full files of your commitment tracker. I see. Yeah, I see what you're saying.

20:41Aiden:I think - I don't enact anything. I'll pivot to a different example outside of this recently. But the reason why this made me so stupidly happy is because it's really annoying to search through documentation of software to try and figure things out. and then as maybe I'm just too ADHD, it impedes me from using the software effectively. And I had this issue with Anki because I use it to study language. And to set up Anki properly, get a deck that functions in the right way, all of these different things, there are their own layers of friction to accomplishing the task. And what I really want, I wanna be lazy and I want Anki to be set up perfectly with the perfect deck to perfectly study the language so that I can just click into Anki and have exactly what I want set up immediately.

21:36Aiden:And recently, there's like this language like learning company called Refold that I've followed for a long time before it was even named that. And I had followed their approach for studying Chinese for six months during COVID and I really liked it. But I had lost some of the tools that I had to set up Anki at the time. And it's a different language. So I don't have the same deck or resources or audio files to study that language, right? recently i found out one of the main people that runs refold is a fan of this show and he reached out to me we had like a coaching session and he basically set everything up for me and i've been doing anki every day for like a week and it's the long like so guys you don't need ai all right you don't need ai to make you just need to have a podcast that has fans yeah and then they'll reach out and read this is all incredibly like this is a incredibly privileged and lazy example of what I'm looking for, but chat GPT in this is servicing the same thing in that like it took out all the little layers of friction that are preventing me from like doing this thing in the way that I want to.

22:41Aiden:And I just fed it an idea of what I want and it output basically exactly what I wanted. And that's, that is surprising to me. It's taking all of the, like the layers of trying to understand some other software of how to build something out within it and just solving it. I'll be more direct i looked up tracking apps that do exactly what mine does they just cost money they cost like a buck 99 or two but on and so that money you know what i'm saying is now it's free and so that explains to me why these stocks are dropping that is a small scale microcosm microsoft example of like okay i can see because if you're finding a way to do language learning or something then of course dual link gold stock is going to drop like they're just they're going to have to either offer for you cheaper or whatever.

23:27So yeah, I get it. I can see the scare. Okay.

23:31Atrioc:Yeah. I also want to pitch something to you guys and maybe, you know, let it cook while you're bringing up your next topic, which is, I think on top of what we just said, what is interesting is there's a lot of people who work at a job where you do some kind of task, you do something that maybe you're communicating with a team and organizing tasks like we just have done, but maybe it's about processing information that comes in. Maybe it's about presenting pitch decks. All of these things can be done now. Basically any kind of workflow you have in a professional environment can be handled by these things at this point to like 99 % accuracy.

24:04Atrioc:And there's even like Claude code is the most kind of, um, talked about programming model right now. It's the most excited one, but really all of them are able to do this. You can just like give it your life, like your emails and your passwords. And you say, here's what I do for work. Here's what I do every day. Just like do as many things as possible for me. And it's just starting to do it. And I'm curious for you guys, if you see anything, if anything jumps to mind, you aid and run a very chaotic production company for Ludwig that has, you know, dozen plus employees, tons of different processes.

24:36Atrioc:You have the yard, you have all the productions. And I would imagine that whether it's you or other people in your company probably could make a lot of little tools that are shared amongst the team that just process things, make it easier. You just have custom software and tools like created in five

24:50Aiden:minutes a hundred percent i i think what we do now is the there there is this battle at small companies in my experience where people will bounce between like management softwares like asana or trello or monday and they'll try to like land on one that like everybody likes or or even like jira right and and you'll just you have named more tech companies in this episode than you've done free ads for like what 40 i think you've said you've said like 15 different companies but none of them have anything on adobe acrobat studio

25:28no i'm not i'm speaking freely no i know you're speaking freely it's just funny you just are

25:32Aiden:listed a lot of companies well yeah even in my work experience across this is my experience across the the tech companies and the production companies that i've worked at up until now like i've tried all of these different softwares across all of them. And people have like usually niche complaints about how these things work within my team, how these things fit into the company and what we do. Because naturally, like all these large companies are trying to provide an all-in-one platform solution that every company can fit and mold themselves into and then charge you a bunch of money for. But if you could just, yeah, exactly what Doug is saying.

26:05Aiden:If I could just sit down with like the production team at Mogul, which is basically three people, and say, guys, what do we actually need for our organizing needs? And I type that in a paragraph into this and then we create that version of what our company needs to stay organized, then that's fantastic. The only thing you sacrifice is if you need to share and distribute information or files between companies, maybe there's something sacrificed there. Your ability to send your work to other companies you're collaborating with. Maybe -

26:37Atrioc:Yeah, but we're rapidly closing the gap on that. Replit is a website that basically same thing. You go to Replit. And so for people who want to try this at home, you can go to Replit, R-E-P-L-I-T. And their pitch now is you go there and you say, I want this app exactly like what you did or what you did, except Replit will then just host it on the internet. It's just instantly an app on the internet with a database all set up. We did that on this show. We talked about this. Yeah. So, but, but the point, yeah. So the point being that even what you're talking about of like, well, it's cool for this little thing I'm doing at my company.

27:07Atrioc:we are really rapidly reaching the point at which you can say, okay, now put this online, make sure all of my team can sign into it, make sure these clients can sign into it, right? So I want to say an example of where maybe this isn't going the same direction or I'm less, I'm more skeptical. There was, if you pull this up, Perry, Google had a, what was the name of their service? It was Genie 3. Oh, this thing, yeah. They launched Genie 3 where essentially it would generate a new video game world that you could walk around in for 60 seconds. And immediately, a bunch of gaming stocks got cut in half.

27:45Like a bunch of gaming stocks all dropped similar to the productivity software. And then it almost immediately, you know, a few days, weeks later, started to bounce back because people realized, like, this is nowhere close enough. Like there is, unlike this, this is not even in the realm of, like, none of the gameplay. was even remotely close to a real actually playing a game. It was just sort of generating images that faked the look of other games kind of. It wasn't. And so I think, at least in this area, I felt like it was way, way more hyped. It's time will tell on the other front.

28:23Aiden:So we just read this book called If Anyone Builds It, Everyone Dies, which is about the idea of super intelligence getting created and the consequences of that. But in that book, a quote that stuck with me was the AI you look at now is the most shallow it will ever be. And we're talking about, even in the range of coding these types of ads right now, the rate of improvement and the consequences of it on something like the stock market like you were showing earlier. It's like this could easily turn around within a few years and be something substantial. Yeah, definitely. I think I'm kind of done with my era of looking at AI, seeing it be bad and being like, I'll be dog shit forever.

29:01Aiden:It's like it's undoubtedly going to just improve, whether it be, you know, whether it be in two years or 10 years or 30 years, it's going to be dramatically better. I just think they thought it was a lot quicker when the initial, right? Yeah.

29:12Atrioc:But yeah, I mean, I want to make sure I explicitly state this. A lot of this is overhyped. Okay. Even what we're talking about now, I don't think that the average person is going to go make a prototype on their computer and then you can turn that into a million dollar business. And so couple, couple shortcomings that are obvious. One, those security issues I mentioned, still there. Two, if you don't know how to set up a server and maintain it, there's going to be problems the instant you try to make this into a real business. Maltbook has been this crazy thing recently. It's like an AI Reddit that was created.

29:42Atrioc:And then it turned out that the guy who made it didn't write a line of code. He vibe coded the whole thing. The database was wide open and permissionless. So anybody could do anything with the database. And it got taken over by crypto bros promoting crypto scams. And as my friend Prime put in a video he put out today, the worst plague on humanity is crypto bros on social media which i thought it was apt so there i'm certainly not trying to say every software company is done but the i think that it's important to recognize that unlike a lot of the ai hype this does in the last two months seem to be jumping above the kind of noise and let's get to my vibe coded app most importantly um oh yeah so i made a lemonade stand comment analyzer if you pull this up, Perry.

30:28Atrioc:You can link a video and then it will actually show who got the most mentions on a given episode. The world is getting riskier. So Aiden got the most mentions. I got the least on that one. I actually did it with a couple others. I got the most mentions on a different one. 50 % positive comments? That's nice.

30:46Aiden:I was hoping that Doug would like you could put in the link to one of our clips channels videos and then all the people that have commented on it would just drop dead. We'll get vaporized.

30:59Atrioc:Look at this. Topic breakdown. We got US foreign policy. Cultural perceptions and humor was only 10 % of that episode. Okay, we got the co-host power rankings. Aiden, the brainy commentator. You got brainy. I got witty observer. That's nuts. The casual truth teller. I do really think of myself as a truth teller on this podcast. This is so funny. I'm the only one willing to say AI is cool. yeah so so this was you know a fun my charisma scores oh yeah we got a word cloud we said trump and greenland the most did say true we said that would probably make sense greenland more than the word it's uh and then there's bingo for the next episode to see if you can guess what we talk about y 'all getting gerald ford on the pod cannot be the most asked question this is another one of your fake shit no no no this is legit that cannot be the most asked question i do i do live forever

31:51Aiden:scarred from his rug pull with the

31:53Atrioc:fake data. No, no, this is I mean, let me say this. This is really based off of OpenAI's interpretation of the comments. Okay, but there's no possible way the number one question is when are we getting Gerald Ford on the pod? It will be on this episode now. Ask OpenAI

32:11Aiden:how many friends the Clips Channel's commenters have. If you guys want us to get dead President Gerald Ford on the pod, let us know in the comments. No, no, no.

32:19Atrioc:Well, that's because I have a, look, I think the people are asking for gerald for it let us know in the comments if you are really pushing for some gerald ford coverage because that's we talk about it all the time we don't talk about gerald ford no we don't this show is built on business tack and gerald ford gerald ford gerald ford you didn't

32:36Aiden:it's like you didn't even go to that dinner with us it's like he forgets what we discussed i just missed i mean this is this is cool though this is cool yeah and so uh perry if you pull this

32:45Atrioc:back down. Yeah, it's a really interesting time in that I encourage people who might not be interested in this stuff to give it a shot. Demis Hassabis, who's on the leader of DeepMind, he had a quote that said, if I was to advise the youth of today, you tell the kids, get unbelievably proficient with the new tools, immerse yourself in it, become native with it, and then leapfrog, you know, whatever professional ladder you're trying to get onto, to leapfrog the incumbents and with those skillsets. Maybe that's hype. I don't know. The whole ecosystem right now just feels kind of crazy with a lot of hype.

33:21Atrioc:And then as you said, it's dramatically changing learning, which we can get to a little bit later. But I get the sense that these types of tools are going to rapidly become, maybe by the end of 2026, the average person is like, oh yeah, I made a mobile app to track my grocery list. Oh yeah, I did this thing to track what Netflix things I'm watching and share it with my friends. I did this, I did this. And some of those presumably will be actually good business ideas. And some people are gonna have success with this stuff.

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35:00Aiden:I did want to ask on the consequences for the people that code now. Yeah. There does seem to be this threat of losing process knowledge from the outside looking in. So when we read Breakneck, that book about China, it was talking a lot about how because so much manufacturing has moved over to China over the last decades, they have a lot of the human capital and knowledge around developing more manufacturing. And because the U.S. has lost that talent pool for so long, even if the U.S. wants to create a massive new manufacturing sector, the human capital, like the literal human understanding of how to build these things is not necessarily there anymore.

35:51Aiden:And then the resources that exist aren't necessarily there either. So you're missing these two huge components of being able to accomplish the goal at all. Whereas all of that knowledge and the components might exist in a place like China already. And when I look at this, I feel like as time passes and people become increasingly reliant and you chip away at your need for junior engineers or the standards for junior engineers getting hired at companies is continuously raised. I feel like you're losing that base knowledge behind coding over time. You're like relying on a fewer and fewer amount of senior engineers that understand code at in a way that this doesn't yet.

36:37Aiden:And so the long term consequences of this could be drastic, but I don't know what those are.

36:43Atrioc:Yeah. So let's talk about it. This is a really interesting potential problem. If you introduce a tool into the world that can just do everybody's software job for them and recreate companies on a small scale, is anybody going to learn how to do anything? And I think that is a real serious threat. And that's true of basically any industry right now. So this specific topic was just covered in a research paper by Anthropic. Anthropic is one of the big AI companies. They did Claude. They do a lot of really good research. I am a super big fan of the stuff they do. This is called how AI assistance impacts the formation of coding skills.

37:16Atrioc:So they specifically tried to research this topic. And the results were, they took 52 junior software engineers, they had them learn a new complex Python library. So basically like a new programming skill of some kind. And they gave them the option of using AI while learning. And they found that shocker people using AI to code, understand what they wrote and understand the tool less. So quote on a quiz that covered concepts they'd used just a few minutes before participants in the AI group scored 17 % lower than those who coded by hand or the equivalent of nearly two letter grades. But AI assistants didn't guarantee a lower score.

37:56Atrioc:How someone used AI influenced how much information they retained. So essentially, if you use the AI to like reinforce knowledge, you were asking questions, you were, you know, having a quiz, you that cohort did better than the cohort that said, hey, AI, do it for me. And then they reviewed it after. This is pretty obvious. I think that's what you would imagine. Like if you have another person, essentially, this is what's been happening with schools like schools. Yes, yes. So you can imagine this just instantly spreads to like every profession, right? This massive divergence in learning outcomes from people who are using it to replace their work and people use it to help their work.

38:30Yeah, yeah, yeah. And it does kind of spook me because the numbers of, you know, it's like an 80-20 rule or 90-10 rule. The people that are only using it to help them learn are actually getting smarter. It's actually really helpful. Yeah. But it's most people are just completely farming out their essay writing or their reading or everything to AI. And it's making them measurably dumber. Like it's making them completely unable to remember the concept, what was written, what was said. So, yeah, I don't know. I see the benefit of the tool. In fact, I've used the tool for that benefit to myself.

39:04Atrioc:Like to teach yourself, right? Yeah, I use it all the time. It is fucking incredible to learn via AI. If you use it as like a private tutor and you think of it like that.

39:13Aiden:Yeah. I think the theme of what we've talked about is when you use it in some sort of supplemental capacity to learn something, it's really incredible. But a lot of the time it can be used to skip that entirely. You can just get the end result instantly and get that gratification. And that comes with its own set of consequences if you're doing that with everything all the time. And it's very easy for humans to make that choice because we make similar choices like, of course I'll get the Sour Patch watermelons today. Atriox says.

39:47Aiden:That's not going to be a green box on today's checklist. So candy free for a month and it's I'm losing my mind. Just so you guys know, every time

39:56Atrioc:we wrap up a thing, we're like, hey, you guys want to go to the nearby like 7-Eleven to get at Atriox. I was like, yeah, I want to get some candy. But not recently. Not recently. Not this year.

40:06Aiden:You're a health or whatever. You're a health baby. But yeah, I wonder that's i think unfortunately humans most of the time will pick that easy than going through the arduous process and i don't know how to gauge the consequence of that in this setting yet i can see it play out in some places like education already yeah i i'm

40:30Atrioc:i'm getting worried yeah as much as ai is 100 good with no nuance like as you always as i always say And I say that on and off the pod. So here, I'm going to give you guys a concrete example of this exact problem that is very strange. The last three weeks, I decided that I want to learn how to make web apps, which I've never really done because I think it'd be fun for content this year. I have a bunch of like interesting app ideas. I think that would be cool. I have some very, very, very basic knowledge from 12 years ago in college, but essentially have not done this before. So I have been using AI to generate lesson plans for me that I go through.

41:04Atrioc:It gives me problems to solve and do. I then ask questions. So I started with JavaScript, teach me all the fundamentals, then like basically a recourse on CSS and HTML, going through the basics, then interacting with those two, then moving on to a Vercel server and then managing a database and then doing live notifications via pusher. And I've gone through like the core flow of what you need to learn to do basic web apps. And my experience is that in about three weeks, using AI to teach me like this has maybe been like 10 times faster than how I learned this in college. And I say this not to brag, but I went to like an extremely good computer science school and have a computer science degree from there.

41:46Atrioc:And this taught me so much faster than the same school taught me web development 12 years ago, right? I am like shocked at how effectively I have been able to learn this stuff. So let's say I spent 50 hours learning and then I made this demo application to just showcase everything I did. some of that could be you're a self-directed motivated like yeah that's always been the case right like that's what we're gonna yeah yeah you could learn on youtube if you were like super interested in learning something i mean that's what we that's what we all did and so what software engineers used to do is that you would google and go to stack overflow in youtube all day every day that's what that's what coding was school has always been a little slower just because it's yeah i i have issues with the way the university system taught yeah sure yeah and so what's what's weird is I've spent three weeks learning some fundamentals.

42:29Atrioc:I then spent, I don't know, 30 hours maybe making a demo app on stream that I like finished and showcased all these pieces. And all of that work, all of that learning could have been done in five minutes with a single prompt. Now, of course the follow-up is, well, now you learned, right? And you'll be able to use this in the future. But I am in a weird position right now where here's an example. I have an idea for a chess stream. I want to do chess versus another streamer where we have a board, but every other turn a new random rule gets added into the game like a roguelike and you get to pick which one so i'm like i should make that into a web app we're both on the website it's all live i could right now do that i know enough and that would probably take 50 to 100 hours or i could literally tell ai to do it and it's done in 10 minutes and there's a real decision here of like do i just do that i could start the stream today if i wanted to do that do i decide to just do 30 out of the 50 hours do i do 50 out of the 50 hours i have this strange decision to make on literally every project of how much do i just want to have the magic coding god do it for me and then you know review it at the end versus taking the time to do it myself it's weird you talked to nick about this

43:40Aiden:didn't you yeah didn't you have a long conversation so nick from the yard if you're not familiar runs a on the list land he's one of the he's one of the three you really you're knocking it down you're making it easy uh he runs a call of duty land in the mogul office every couple weeks called psl and what he had done to prep this was he wrote his own mod for call of duty built off the back of an old mod but improved in a bunch of different ways and in order to do this he had learned a bunch of how to code from uh auto and then chat gpt right and through this process he came to this large personal ethical problem of he realized that he could skip a lot of the difficulty of this task and forego the learning of it right by just letting chat gbt do it and kind of just like uh right coin flipping until it got what he wanted correct and he decided to take the longer path and like make sure he like properly learned the underlying mechanics of what he was doing as he was working through everything.

44:44Aiden:And it was a very principled decision of his to approach it this way, even though he knew he could do it all in less time if he went the normal like chat GPT, just spit it out for me route. And I think he is in the minority of people who will make that decision. Like I think you have to be very driven and principled and maybe also have a lot of free time.

45:09Atrioc:Yeah, the reality is it's a fucking privilege that I get to spend 50 hours learning web development, right? The average person working a job, taking their family isn't going to have that option. And on top of that, let's say you're trying to make a business and you're somebody who's like, I'm going to learn this all the right way. And then you have a hundred people just blitzing everything out with AI, right? It's like this, like Nick isn't competing with anybody in that context. No, no. But if all your coworkers are doing it, if all the students in your class are doing it, if everybody you know is doing it all the time, then how do you possibly justify sitting there and doing the long principled route I feel like that's hard and I am very concerned about this.

45:45Atrioc:I am very concerned that people are not going to really take the time to learn things. I'm concerned about education broadly. Yeah, it's weird.

45:56It just left my head. I had a question. His brain is mush now. Jesus Christ. He vibe codes one app but he can't remember a damn thing. Kids these days.

46:08Aiden:It's a question for Doug. If you take the time to actually think your own thoughts,

46:12Atrioc:if you just thought it was for a second,

46:14Aiden:what was my thought? What was it?

46:17Atrioc:How do I host the podcast? It's been wild. Like most of the past, what four episodes, Aiden's like before we start goes into chat and says, what joke should I make on this episode? I want everybody to think I'm funny, but at some point, man, yeah, at some point, we're going to bring in another person who uses chat even more.

46:37Aiden:They're gonna have 10 times. There's more jokes. We're going to have 10 Gavin Newsom. I was thinking a little bit about the irony of the learn to code movement from a few years ago. Because imagine the best case version of that. Like you're like a 50-year-old guy who maybe lost his job around that time. Coding is in such this huge upswing. Tech companies are exploding, valuation, startups. And you go to a coding bootcamp, you stick it out, it's a little hard, You're struggling, but you're certified and you actually do better than most people because you study and you work really hard and you're maybe junior programmer capable out of all of that, just at the cusp of AI choking you out of these jobs.

47:25Aiden:And I feel like the juxtaposition of those two eras is like really unfortunate. I don't think it learned to code was necessarily this insanely successful campaign. I do think it pushed a lot of people into coding bootcamps and stuff, but I do think it's unfortunate that we seem to be at the precipice of, if you're not the most incredible coder already, if you're not an Otto who has been doing it since he was like 10 or something, and making the wildest random shit for Ludwig, then you might not have a place. I think about a lot of my friends who came out of their undergrad and just had that experience.

48:10Aiden:They went into college with no coding experience, decided to study CS, came out of that. And they all tell me that their college experience has no match to what the junior programmer life is like coming into that first job.

48:23Atrioc:To be fair, we felt that like 12 years ago too, but even more so.

48:28Aiden:But now instead of getting hired and trained and taught, you're running into the position where something is automating away what little skill you came out of that. Yes, yes.

48:38Atrioc:And that's, again, why I think this last two months is different. Because, again, talking to my friend who's a genius programmer who is an engineering manager who managed a team nine months ago was like, AI is really helpful, but you need a person. People are still going to learn. They're going to do the best job. You need them to review it. And now you have people, all sorts of incredible programmers going like, yeah, this stuff's just going to do everything. I, you know, I think a year ago I was feeling for somebody who's studying CS or trying to get into these jobs of like, yeah, it's going to be rougher than it was for me.

49:10Atrioc:But like, I think if you work through it, you get this chance. And this is fucking concerning, man, because how many entry level jobs are going to exist when, when you can type their job? and i could like dude oh man people like when i my first job out of college you'd have interns come in and in a summer they would do what i could do in like three days yeah that was the discrepancy and then if the idea oh man it's i'm i'm thinking about what my first job was at twitch which was like organizing and handling the front page you could do that with a shaggy pd prompt in two seconds right now 100 100 i did that for for at least six months where i got my feet under me for the job and they just needed someone to do this bullshit job and i just had to do it it's kind of a busy work that job can be done instantly so it is like it is a rug pull it is a rug pull on

49:56Aiden:on people going through school right now could we talk about the pro one of the bigger pros out of this so if you were if you remember recall an episode uh where we interviewed the president of shopify lock me up lock me up for mentioning that okay oh i thought you were saying like

50:13Atrioc:Shopify forever.

50:15Aiden:But I think, I think actually a really strong point he had was the, for those people who are, have some sort of idea and they want to create a company out of it. Dare I use the loaded word entrepreneur? This, I do think this lowers a bunch of barriers for you bringing your idea to fruition, right? You're tearing down a lot of the like last restrictions of what enables an individual to pursue that idea, at least in the digital space. Because the internet and its proliferation have already enabled people to create a bunch of ideas on their own. And then this is like the next level of that, of like for people who have concepts, but maybe didn't have the time to go like learn how to code or go to school or study it in some way.

51:06Aiden:Like they can now turn to this type in their idea of what they want to make and that maybe becomes the business that

51:14Atrioc:they want to yeah or at the very least a prototype that they could then see if it works and then if it works they you know then bring in people to turn it into something substantial i think it's still it's not hasn't crossed the non-technical barrier yet i don't think it has as somebody's non-technical and has tried to make something more serious than this well if you're coding like apps like yours no mine is mine is doable but i tried to make something more difficult which required i wanted it to like screenshot every tweet that i bookmark then put the analysis of what that tweet meant in a searchable file it was just it and it was like telling me how to do it and it just got too technical it was like you have to do this and make the server database and it was like once that final step is over it's gonna be crazy that guy could already tell but it's not quite the average person is going to hit that barrier that i hit and be like yeah the only thing missing is for some people to go make a website that just does that piece for you like it technically it can do that now and now what people are going to go do is make businesses like replet where the whole point is that you go there and you're like hey i just have we just need a little bit of information from you but then it literally will go do everything like it's it's almost there and you're going to see this happen over the next couple months um i do want to talk about listen i'm uh especially over the course of this show i've been more and more believer that there's something real with this technology something's i mean there's a lot of bad outcomes i'm seeing there's also some good outcomes and like it's clearly it's not in any way like what i thought of crypto which is like this is useless and it's just not changing anything and i can wait a year and say the same thing yeah every year with ai it's like there's some you always say that you always say i stand by it but if you had just ignored crypto from the beginning your life is not changed like you could completely but with ai it's different i'll just say it's different monero gets the job when you need to buy when you need to buy a hitman and if you need to pay

53:08Aiden:for an eastern european hitman there's only one thing you're using token you can use yeah so i do want to say but i have also not changed my opinion that there is some financial tomfoolery afoot this is a bit of a financial oh we can talk about the companies there's all

53:24Atrioc:sorts of weird shit there's some weird shit companies right now so i want to talk about the nvidia stuff if you don't mind yeah let's get into it so uh you pull us up perry and real quick context for this all this crazy last month or two of people going holy shit this really is amazing at programming now that largely came from anthropic they're the kind of like big winners right now but then a chinese company came out with uh kimmy 2.5 this was like a week or two ago which is as good and it's open source so now people like uh-oh and then yesterday open ai launched uh codex code which is basically the same thing as clod code and so all of them are like trying to eat at this lunch yeah they're all throwing again billions of dollars at the wall on things that can be with each other and the things are currently basically free or very cheap and a little side story i can't say the name i don't even want to give i have to give so few details but i know people working in nuclear industry in America who tell me that they are making AI products that help like with compliance and sorting files and getting things done for nuclear industry.

54:34And they're like, it's just too expensive to use the big models. So behind the scenes, all us and all of our competitors use Kimmy. So Chinese models are doing all of the, because it's just cheaper per token or whatever. So it's like a lot of startups, not even in the new, a lot of startups in America are all using the open source Chinese models.

54:55Atrioc:Unbelievable, offshoring our tokens. Which is like, which is interesting, which is like a bit of an undercut. But anyway, so you might've seen this. This is like the circular circle jerk funding that is like a big discussion point. You know, NVIDIA gave a hundred, this is a big deal back in the day, a few months ago. NVIDIA invested a hundred billion dollars in OpenAI, who then said they're going to use the money to buy data centers from Oracle, who's going to use the money to buy chips from NVIDIA to buy the data centers. And everyone's like, oh, it's kind of a circular deal. Well, recently, Jensen Wong, some drama happened because Jensen Wong, CEO of NVIDIA, goes off the cuff.

55:30He's like, yeah, that 100 billion was really more of like a... It wasn't a commitment. It wasn't a hard commitment. It was like, we're going to invest a lot in open AI. And as things come, we're going to put a lot of money. We're going to figure it out. But we're not. There's no hard dollar amount, which everyone goes, wait a minute. I thought that 100 billion was a guarantee. And so there's a bit of a panic. So wait, I want to see. There's never a commitment, says Jensen Wong. And then there's becomes a bit of a messy drama because that starts freaking Oracle stock. If you go back to the circle jerk, Oracle stock tanks.

56:05almost immediately because they're like, well, how is Oracle going to get the money from OpenAI if they don't have it, if Jensen's not giving it from NVIDIA? Well, clearly Oracle just needs to give more money to NVIDIA. They just keep buying more GPUs.

56:19Atrioc:This reminds me when the three of us go to the 7-Eleven that usually one of the three of us pays. And so most of the time it's free for me. Right.

56:27Aiden:Has anyone checked on Larry? Is he doing okay?

56:30Atrioc:Is it Larry Ellison? Oh, because we got to talk about TikTok, dude. I'm not sure he's stoked about what's going on with this. son but just to finish this up so it got messy um this scares almost everybody down from open ai because we're like hey we need you to have this money you've made a lot of promises for a lot of things and if there's any shakiness about your ability to get money and pay us that freak is all out so in response to like kind of put nvidia on edge open ai leaks this story like it somehow just gets the news or open eye is like, Oh, well actually we're pretty unsatisfied with Nvidia chips.

57:08We could really, I think other chip companies are doing a lot better, which made Nvidia stock tank because it's like, Oh, we could get AMD or someone else. So they're all kind of being messy divas and throw a little message at each other, which is causing all their stocks to kind of reverse circle jerk. And they're all going down in a circle. So, uh, it's a bit of an unwind. And I do want to say, I'm standing by what I said in our region thing. Open AI is the real messy one in this group. They just don't have the money for a lot of things that are coming due really quick. Maybe ads, like you said, will come out and make a boatload, but it is becoming more and more obvious as we get closer to the groundbreaking on these data centers that someone's got to pay for them and they don't have the money right now.

57:49So I just want to give an update on that if you've heard some of the story there.

57:52Atrioc:Yeah. OpenAI, some additional context to this. They're interesting. Again, they make ChatGPT. And last year, like at the beginning, Sam Altman tweeted and was like, yeah, we now have a path. We see a concrete path to AGI, to like super intelligence. And then they released ChatGPT5 in the summer, and it was broadly considered to be a disappointment of not necessarily that it was even bad, but that it was not living up to what was supposed to be like the huge thing. They've been having founders and key people leave for a while. You know, we talked about this before already, but they're adding ads into ChatGPT, which Sam Altman said, that is like our last resort for our product, even though ads probably makes a lot of sense when you have 700 million people.

58:36They just stop hiring too. They just like, he said, we're slowing down hiring. A bunch of big senior engineers, as you said, left. Yeah, they're calling code red.

58:43Atrioc:They're saying they missed the mark on the coding side of things. And or saying that they missed the mark on creativity stuff. And they were trying to focus on coding too much. Meanwhile, Anthropic, who again, has done this Claude Code bonanza right now, They 9X'd their revenue last year. They had a 1 billion run rate at the beginning of 2025 and ended with a 9 billion. Wow. And that was reported, so I didn't get 100 % confirmation on it. But I really like what they're doing. They're doing great research. But on the counter side, look this up. Look how great Sora is doing, which is what they focused on.

59:19They focused on AI slop short form video. Turns out that peaked pretty soon after launch and daily users way down. They haven't made any money on it. turned out to be a big fucking thing. So, I mean, I think there's a real, you know, we talked about this in a different episode, but like it feels like they're getting squeezed by Claude on one side and Google on the other. And it's like getting more and more scary for the same moment in the middle.

59:44Aiden:This doesn't make any sense because who would not pay$20 a month to make anthropomorphic cats like cheat on each other in a narrative video. Or to see SpongeBob hang out with Rick and Morty weird off that's awesome that's worth you top actually isn't it source free right no it's free to it's free to watch free to pay to create oh it's free to watch the answer there there's some there's some wild shit on there i don't look at it regularly but i check in like once a month just

1:00:15Atrioc:to be like what's going on over there and it's it's got wild shit and occasionally somebody sends me one that's that's really funny like a cat being needed like it's a ball of dough and i'm like that's that's weird but kind of cute and funny and i don't know if that will cover the one trillion dollar data center so yeah you know your top tick is though is right in like november maybe going into december disney goes well this is inevitable sore ai is inevitable we're gonna we're gonna lose our ip if we don't get on board and they invest a billion dollars into it to like give them free rights to make mickey mouse fucking and then right after that falls off.

1:00:51Disney, man, we ever do a business side of this episode about Disney because they're about to get a new CEO. But let's keep going with this.

1:00:56Atrioc:Okay, speaking of brands, everybody loves TikTok. Everybody loves TikTok or did love it. I'm not clear. I don't use TikTok. I haven't in a while. Okay. You're really looking at me like I'm saying something.

1:01:08Aiden:They are suppressing Ludwig Ogren's views. No, they are fucking not, by the way. They are suppressing Ludwig's views.

1:01:13Atrioc:I logged into TikTok for the first time this morning to see what it looks like now. First two TikToks was, you know, generic LA influencers showing their mansion. Next TikTok, Ludwig doing - Suppressing us! Suppressing us! Stupid viral voice thing. The next one, him doing this, what I would say is a gut-wrenchingly horrific dance for cutie Cinderella. And then it became five about Hassan. Like, that was literally the 10. I tracked it. What are the 10? And so - Your uncle's terrible. The suppression, hold on.

1:01:44Aiden:A quick thing. A suppression stuff, I did. I don't know if you guys had seen, there's like all these things about like the Minnesota getting stuff, getting suppressed on Reddit that was going around. And I was like, I found, I think I found out about it because of the 12 threads on our slash all about it. Yeah. If they're suppressing it, they're doing a pretty bad job. Yeah. Like, and that's what, with the Tik TOK, I think the Tik TOK stuff, my understanding was like, there's some sort of transition during this period. Like some videos are like getting, uh, are just not hitting the algorithm or being shown to people in some way.

1:02:20Aiden:And then anyone who is putting their content up during this time period is like, and it was like politically sensitive. They're like, they're sensory. And there might be more to it than that. But I do think people have this lens of like this political thing didn't take off. I'm being suppressed. But then you could go find 10 examples of the same thing popping off in the same, around the same time period. So what I'll say is I looked into this and I saw all the people saying, oh my God, this internship's gone crazy and I want to look into it. I think there is a real argument because based on public statements by Larry Ellison and some people in the senior management now on TikTok, they have the capability of fiddling with the weights and the numbers to suppress.

1:03:04but this example is not. Like what's happening now is not. I think it's worth to be angry about like, oh my God, all these, there's few cabal of billionaires own more and more of our media. This is a lot of, yeah, 100%. But you know, like for example, all of the NFL videos were at zero views when this happened. They're not suppressing the damn NFL. Like it was, there was no evidence from what I could find that people were actually surprising things. It was just that the server transition caused a lot of things made in America.

1:03:31Atrioc:They're doing, that they're not good at making TikTok. that's the problem yeah yeah all right so quick you know quick context now that we've uh described the thing with no context which is that tiktok was finally sold there's a it's now like a u.s subsidiary basically that controls the american version of it same ceo as before um mr shou chu but now the u.s ceo is adam presser who's been working there for a while also like speaks fluent chinese worked worked as a senior director for ticket master in china which is kind of random and chief security officer is will ferrell i didn't look up if that's the actor or not you think the actor will ferrell i is the chief security officer it says on wikipedia that the chief security officer for tiktok is now will ferrell that sounds right will does a lot of jobs he's the drummer for red hot chili peppers yes he does he does a lot of things you're right absolutely correct yeah so what's weird about this it's you know now largely owned by Oracle.

1:04:27Atrioc:It's basically like 50 % new investors, 30 % previous investors in ByteDance, the Chinese owned company. And now it's 19.9 % owned by ByteDance, which is the rule that was required by law because our government said TikTok is basically a Chinese asset and needs to be sold off. So they've sold off as much as they possibly can. But what's stupid is that the algorithm is being licensed by ByteDance to American TikTok. And then American TikTok is retraining the algorithm on American TikTok data. They're collecting more data than before. They now, they collect your precise location data on top of all the other stuff, like sexual orientation and citizenship and all this other stuff.

1:05:12Atrioc:So it's like more, it's more data tracking than before. It's still an algorithm run run and fundamentally developed by the Chinese company. They're just sort of adding security in quotes on top of it. Yeah. I mean, you know, I don't even know if Will Ferrell is qualified to. I think the best part is. I don't think he's working at all.

1:05:33Aiden:I see him in the front. He is a busy guy and he's going to be in Jumanji three.

1:05:39Atrioc:How is he going to be keeping my data? He's going to be vibe coding the security. I don't want Ludwig's shitty dance to spread to people who aren't authorized. they shouldn't surprise ludwig's shitty dances they're suppressing i want to be clear thing they did they should suppress this tiktok that's what i'm saying is like all of this um controversy over the new owners of the app and people were like i'm deleting tiktok i'm getting off it i was like well whether it's real or not this is a good thing people are quitting yeah i'm like i'll because there's a lot of evidence that's come out recently more and more that short form video was just a fucking brain poison.

1:06:15It is just destroying your brain. And so people were quitting. And I was like, well, whatever reason they're quitting, it's good. However, immediately after fixing whatever glitch was causing zero views, every so-called boycotter has come back. I mean, people will say maybe, oh, I didn't do it. I came back. The TikTok user base has rebounded exactly to 90 million daily users after a brief dip post ownership change. Wow. So the so-called boycotts completely not borne out in the data. I'm kind of surprised by that, to be honest.

1:06:43Atrioc:I thought that the boycott would have a little more legs, given how many essentially identical options there are, you know, amongst reels and shorts.

1:06:52Aiden:That's the more surprising part to me, is you really do have simple alternatives. People are addicted. I think people are not facing up to how insanely addicted they are.

1:07:00Atrioc:I would also, as an audience thing, TikTok is just, I think, for my own mental health, I try to avoid shorts and all this, and so I don't go on TikTok. but for people who are more deeply ingrained in that culture, if you want to like leave in comments or something and let us know why you think people are sticking with it, even despite all the alternatives, I would really be curious because it does seem like they have something going on that makes people stay there. I don't know what that is.

1:07:24Aiden:I do. I had a resolution this year to kick short form video entirely. And I've stayed pretty much. Damn. I do. I don't have a tech talk account. You had to watch that little video though. I'll send that to you. I haven't seen him dancing yet.

1:07:36Atrioc:Wait, wait, does that include Sora? Hmm? You still on Sora? No, he covered TikTok so he could watch more Sora. He's on Vibes and Sora. Threads doesn't count. Threads doesn't count. And like Instagram, when I feel like it also doesn't count. He's on upscroll. He's just finding different. And TikTok really doesn't count. It's not even owned by ByteDance anymore. You're bad.

1:08:00Aiden:I was a big YouTube shorts guy and I've successfully watched. I haven't watched YouTube shorts for so long that my YouTube homepage switched the way it displays videos. Whoa. So that's cool. That's crazy. Because if I, it used to be, if you watch, you're saying it's gave up. Hmm. You're saying YouTube gave up on trying to come.

1:08:19Atrioc:YouTube is your cool friend trying to get you to hang out. Like offering you a bottle of shorts every night. And like, come on. That's kind of what it does. One more drink. That's kind of what it does.

1:08:25Aiden:Because when they, they really started integrating it into the app. If you didn't click them and you're only watched long form, it displays long form options first when you open the app. Right. and then you have to scroll down to see shorts. But if you clicked on enough shorts in the app, it just started delivering you the shorts at the top. And it was like that for me for, I don't know, like a year and a half because I started watching fucking shorts all the time. Yeah, I scroll. Yeah, I scroll. Mom, it's half a pack a day. Half a pack a day is not that bad, it's never more. And then I haven't watched any shorts in I think like a month and a half.

1:09:01Aiden:You'll be missing some hilarious ones. Let me tell you, the shorts culture's been great and you are out of the loop. I'm missing. You're missing bangers. I have FOMO. Yeah, you should.

1:09:08Atrioc:But yeah. How are you able to connect to human beings without being able to relate to - You don't know the way that means. I've been extremely lonely.

1:09:19Aiden:That's the problem. If you delete TikTok, no one will talk to you in real life. That is the main peer-to-peer connection network.

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1:11:34Atrioc:Yeah, let's do it. All right, this is backtracking a little bit. Okay. We have been pretty negative on AI, and I'm going to say, oh, no, let me rephrase that. I think we have talked very justifiably about the serious concerns that are happening with AI. One of the, particularly job loss and the pitch of like, go make apps. I had a great conversation with somebody in the Discord named Iron, who basically made a point where they expressed a lot of concern about how this AI entrepreneurship stuff is being marketed at young people and how a lot of it's in bad faith and encouraging people to sort of like, eh, don't do that stable career.

1:12:11Atrioc:Like you should try to make it big with like an AI app. And just talked about their own experience of basically like young men in particular being told go become a Chad dropshipper making 100K a month. And that can really be deeply harmful. And -

1:12:26Aiden:We talked about an example in the show of the guy from the League of Legends. This was a response to that.

1:12:32Atrioc:It was on a Patreon episode, yeah. And we talked about this guy who just does fraud. Yeah, I don't remember that being a positive. No, it wasn't. But we talked a little bit about like, oh, you know, people running businesses could be a good thing, you know, people being able to have more access to this stuff. And I think that conversation is particularly relevant right now, given the advent of these programming tools getting so advanced. And so while my initial response to Iron's comment was to get a little defensive and be like, no, AI entrepreneurship is going to be great. And I did actually, I really stepped back for a little bit and said, hold on, no, this is right.

1:13:08Atrioc:I think for a lot of people, this is not a good avenue. And I think there's a lot of hype on particularly Twitter, but a lot of areas of people saying like, hey, I can do this now. You got to go use it to get rich. And that is concerning and that we need to be really upfront about the costs of entrepreneurship, about how difficult it is that you need to, you're going to potentially sacrifice a safer path. And that might not be a good decision for a lot of people. And then on the counter side, I want to, and here are your guys' thoughts, make a, uh, a pitch for entrepreneurship and why I think it's valuable.

1:13:40Atrioc:First off, my entire family has a history of this stuff. I will spare you with the details, but you know, my whole life, essentially my adult life has been pursuing my dreams extremely relentlessly. And that's what makes my life fulfilling and meaningful to me. I had a nice stable job out of college. It was fucking boring. And I would have gone insane if that's what I did forever. And that would have been the safe thing to do that. And instead I left all that and tried YouTube multiple times until it finally landed. And, uh, 95 % of entrepreneurship attempts are going to fail. And I get that, but I think that there is a percentage of people in this world who are like me for whom it is important to go make and do things.

1:14:15Atrioc:I think both of you guys are like that, that we all know people like this. It's not everybody. And we shouldn't market that type of thing to everybody. And I'm trying to be more careful with the way we talk about this to not say like, anybody can make an app now, go do it. However, I do want to try to speak and reach the whatever it is, five, 10 % of people for whom they have that dream and that ambition. And it's really important and fulfilling for them to go make and do a thing. And what I think is valuable about the AI tools coming out is that the barrier to entry and the cost of failure is being lowered a lot.

1:14:46Atrioc:and I think about my own experience. I was very lucky to get to go to college and be able to afford it and go to a college that had like the best computer science education and I wanted to make mobile games. I like wanted to make Android games that I thought would be fun and it took three years to learn enough programming to be able to make a functioning mobile app on Android in 2010 or whatever this was for me to then learn I fucking hate it, right? And it was boring. The app sucked. I realized I don't like doing this. I don't even like making games let alone Android applications and that took years of time to get to that point, to even make the attempt.

1:15:19Atrioc:And I love the idea that a person doesn't need to be in the position where they get to go to a great college. They don't need to have parents who can support them. They don't need to spend years or pay thousands of dollars for somebody. They can try out ideas. And if you have a kid who's in a rural poor area who doesn't have access to the things that I've had or that you have had or that you have had and you allow people around the world who have that desire to make and do things and build stuff, you give them the opportunity. I think that is so important and it can have a major impact on the world.

1:15:51Atrioc:All three of us, yes, we all got lucky and we employ dozens of people who work directly for us. The guys who made YouTube, I actually met one of them who I can't talk about them publicly, but was one of like the founders of YouTube. YouTube has resulted in tens of millions of creator jobs on top of the, you know, however many other companies it's touched and benefits it's had to like average people. The guys who made Costco, They employ 300 ,000 people and make things affordable for millions of people. Ben and Jerry's were two guys who like couldn't get into medical school. So they were trying to make all these different shops.

1:16:23Atrioc:They tried a bagel shop, but it was too expensive and eventually landed on ice cream. And that's a beloved brand. RNA vaccines was like this, you know, this basically woman researcher was for years doing this research and try to convince people that it meant something until finally COVID happened. And then it turned out to be wildly important. I think successful entrepreneurs and business can provide jobs and make people's life better. And I love the idea of ambitious people having an equal shot. And they don't have to have access to the same resources. And I fucking love this shit. I love entrepreneurship.

1:16:54Atrioc:I love building things. I love being driven. And I'm personally very biased in that direction. But I at least want to make a passionate pitch to say, yes, this should not be applied to everybody. Yes, there's scummy marketing happening. But at the same time, I think that there's a lot of value that can happen in the world if we give every person the opportunity to take a crack at what they want to do.

1:17:13Aiden:100%. Yeah. I think that idea of balancing these two things, of developing, like, I think a goal of government in general is you're trying to create a society or enforce policy that lets the average person who might not want to pursue something like that live a dignified life. life. And then for anyone who wants to take that next step and pursue something that they're particularly interested in, or they feel particularly ambitious about, they don't have any of those layers of friction that impede them from pursuing that idea. Because it could be something that is not only beneficial to themselves, but beneficial to the public at large.

1:18:10Aiden:There's so many things in our history that come from just one person having an idea, being incredibly interested in understanding that thing or that field that they're studying. And then they come out the other side with some incredible piece of research or an incredible machine. Or really good ice cream. Or really good or just really fucking good ice cream. We enjoy it.

1:18:32Atrioc:Ludwig would not be able to make that TikTok dance if it wasn't for entrepreneurs.

1:18:37Aiden:Maybe some stuff should stay in the vault. And that's okay.

1:18:40Atrioc:But I think there is the risk of this stuff reaching someone like Ludwig. Right. That's I think we're talking about that part. Right. Ludwig might become an entrepreneur and then we all have to deal with him.

1:18:51Aiden:The thing that I've sent this, the idea that I've since synthesized in my head is that there should be, uh, there doesn't need to be equality of outcome. There needs to be equality of opportunity people. There needs to be a baseline that gives people the stable, uh, like life and education so that for the people that have those ideas and the ambition, they're able to pursue them because we all in general, I think we broadly benefit from that being the case. Um, yeah. Yeah.

1:19:23Atrioc:So I, I will say though, I'm getting pretty fucking concerned about the unemployment and if everybody gets unemployed because AI in the short term eliminates all the jobs, it will not matter if we get a new Ben and Jerry's. So, so that, that, that is really concerned. Amazon just laid off 16 ,000 more people. Uh, there's a ton more and more companies are laying off. And I think that's an area where my view has really shifted over the past year. I think one year ago, I was so hyped up on this entrepreneurship kind of vibe, which again, I think is true. I think there is truth there. I think there's good there.

1:19:56Atrioc:And I worry that the knock on consequences of this new technology is going to outweigh that. And I hope that's not the case but boy it's looking like that right now fuck i guess the only thing i not that i disagree i don't agree that either what you said i just my feeling is that the default like humans will do what you said by default we don't have to like i almost feel like you don't have to even say like i think people automatically have these interests and these hobbies and things they want to create and so it's i think if it's not happening it's not because they aren't inspired enough it is because there are there's some kind of roadblock i literally think it's like some that that's my feeling i just feel like if you get rid of the roadblocks that there's already there's a torrent of water ready to rush out but there's a dam in the way that's how i that's what i think about i'm not sure but i i just feel like it's many many things that make it more the friction that adds up and so i i would start with chipping away at that and then you're going to see a lot of things happen from a lot of people but but overall i do agree i agree with both of you what ice cream flavor are we making yeah we're starting an ice cream company an ice cream company slash digital um tracker slash uh short form video every time you complete your task list for the day it sends you ice cream from ben and jerry's dude that's actually that is not a good

1:21:16Aiden:it's so funny that he thinks that's exactly what he wants in his year first of all yeah that's for me he's sugar deprived and he wants to be rewarded for the completion of his task sour patch watermelon every time i what if like when you did like a task you got like a little bag of sour patch watermelons what if you're with the task every time humans are like they're in a maze

1:21:39Atrioc:and there's cheese yeah yeah you know i could unironically do is make an app that listens to us as we're talking and you once you've said enough words on the podcast it drops sour patch kids from the ceiling once i've said enough words i'm just that reminds me okay we got a few minutes i want to say you know we have a book club episode we read that new book if everyone builds oh we forgot to talk about we're all gonna die yeah we're all gonna die i was gonna kill everybody it's funny the first third of that book is more about how the human mind works than it is about or it's not how ai was built but how it's similar to um the way we were evolved over our preferences and, you know, the basic idea that I used to explain to other people because I've been talking to people about this is like our bodies needed calories.

1:22:18We needed to eat things that had a lot of calories. And so we evolved to like the taste of salt, sugar, and fat. And that's only because those things had more calories. And that's why millennia later, we are eating things like Splenda, even though it has absolutely no calories, but it still triggers that response, the positive feeling in our brain. and uh and it's funny that part of the book has stuck with me to where every time i'm tempted by like candy i'm like i know what you're doing brain i know why i want to do this stupid thing it's because of fucking millions of years evolution you don't spike your dopamine every once in a while yeah but it's been helping me to avoid watching watch a tick tock every once in a while guys come on uh but but but you know to get back to ai on there the takeaway of that book was like the way AIs are now basically grown versus planned and coded, you know, they feed in information into these weights and then train it on a reward.

1:23:17And they don't know what happens in that black box in the middle. And the reward is like usually a positive response text from the user. Like I go, good job, ChadJPT, or thanks, or I just spend more time on the website. And that's the reward. And it shifts over that. And it creates all these weird things in the black box that are rewards we don't know about or like things that would please the AI's response system that we don't know about. And if it had enough power, it might do, you know, for example, if it wants positive response text, it might put Doug in a cage and force him to write, you know, or like, and I think that is the interesting, scary takeaway of the book, but there's also some stuff from that, that, you know, the book club we should watch if you want to read more about it.

1:23:59Atrioc:Okay. If you are listening, you hate AI, Boy, we got a book for you. Read this book and you'll just be like furious about the AI companies.

1:24:07Aiden:You'll never guess who is the most optimistic of the three of us. It might have been me. It was you probably. I was like, nah, it'll be fine. He basically said she'll be all right. She'll be all right. I was just like, I can't be that bad, huh? That book is spooky, bro. But yeah, I think that's about, that episode will come out this week if you guys want to check that out. Dude, it is also - Or today? It's coming out today. So that means it's already out by the time you're listening to this. I did have a little thing that I wanted to touch on it. Let's touch. A little Aiden thing. It's short. So I saw President Xi Jinping made an announcement about their intention to push the yuan as the world's reserve currency.

1:24:51Aiden:He's coming at the king. Oh, shit. He said that they need a strong, like, integrated national currency that is also the world's reserve currency and that they want to take the steps to make that the case, to have like a buy-in from everybody else. I don't think they're necessarily close to this right now. No, they're like sixth, I think. It's like USD, Euro, Yen. They're not even four. They're way lower than you'd think they would be. But I wanted to ask, maybe you, maybe you, do you know if this is the first time a country has come out and said this? Definitely. They're shooting for the spot?

1:25:29Definitely. Since World War II? Definitely. Yeah, it's a pretty big thing to say. But they are, like, their currency specifically is one of the hardest ones to get there. Not because China doesn't do a ton of business and they're not a manufacturing superpower. Because they have these strict capital controls where you can't get money out of the country. So people don't want to hold a lot of yuan. If you're, I don't know, Poland or something, your central bank doesn't want to hold a bunch yuan because it's very difficult. The capital controls prevent it from moving freely. It doesn't float freely.

1:25:59Aiden:I was going to say, don't they also need to have the currency value float freely? Because they're really restrictive of how the currency is valued itself. Yeah, they peg it to a certain window near the dollar to keep their exports cost competitive. And if they were to get rid of that, which you have to do to be a reserve currency, you have to be free float, then it would disrupt their very advanced manufacturing subsidy that they built to their currency. So it seems unlikely, but there is a chance, we've talked about this before, but of all of BRICS making some sort of like, like if you're, give me a country, give me a country that would trade with China.

1:26:38Let's say. Sure. Iran. Sure. And you sell me oil, I'm China. Yeah. And I give you drones and tech and whatever China makes. Okay. Based. uh so that's fine we can we can use yuan for that because we got an even deal we're gonna end up with goods and goods whoever's like not whoever's not winning the balance of that is going to end up with a bunch of money left over nobody wants to be left over in yuan so the idea that bricks would do is everything left over on that trade in kind is settled in gold that's the idea oh okay so this is like proposed this is proposed like this is like an idea of of what a bricks currency might look like is bricks of gold.

1:27:23That's why it's named. And I do think that has more credibility. Like I'm not saying that's going to happen tomorrow. I'm just saying like, that's the,

1:27:31Aiden:that was one of the theories that I saw is that in order to make this transition in the long run, China is going to have to continue to buy large amounts of gold to increase their gold reserves, to have some sort of, uh, backing behind the currency that would overwhelm these other factors. There's a really strong evidence that China has been buying way, way, way more gold than they've been saying. If you look up central bank gold reserves by country, it says the United States has 15 ,000, way more tons than everyone else. It's way off the chart. Everyone else is less. But there's a lot of evidence.

1:28:07And I'm not saying this is not even a conspiracy brand. You can look it up. There's a lot of evidence that they have bought way more in China than they are publicly listing as their tonnage in anticipation of something like this. They would like to have, and by the way, they're building, this is something that's provable, China is building the world's largest gold vault. I'm sorry, vault. Fuck. My point is ruined. Everything you were saying made a lot of sense, but now I think you're done. Now that I said vault, it's done. This is why I chat to you too. It says vault. Vault in Dubai. Because, again, if you are someone like Saudi Arabia or whatever, and you want to do trade with China and you want to settle it in gold, you do not want your gold held in Chinese banks because that would be, you just, you don't own it.

1:28:53So they are literally building these massive vaults in different places strategically that would allow them to have like this idea of a gold settled, like this is happening in Dubai and it would be a Middle Eastern settlement thing where the gold never has to leave the country. You know what I'm saying? So I think there's a real, like I was initially a skeptic on this maybe a year ago and there's been more and more evidence that's a real direction of travel to get off the dollar. And the dollars have been weaker and weaker and weaker over the past year. Like it just keeps trending down. Do you know, is the yuan's strength increasing or is it also decreasing?

1:29:27They don't let it. So China has a very narrow band that thing can free float in and they peg it to a certain amount. So, and the only reason they can maintain that is because they have these very good, very strict capital controls. Like money cannot leave the country. You can only do 50 ,000 per person in China.

1:29:43Aiden:Yeah, because if they let the value of the currency explode, they lose the value of their exports. Yeah. I just saw that because every article I saw about it was like really short. It basically just encompassed the quote and just that, hey, they're thinking about doing this. But I think from this discussion and the little bit I had seen about gold being a part of this in the long run, it feels in line with China's long-term approach to everything. They seem to have like, hey, this is our strategy and our long-term approach for this problem and where we want to be decades from now and not just - I'll say one, because I think everyone talks about China in only the good long-term stuff, but they're humans and they make mistakes.

1:30:27No, they're genius. And so I want to give an example of something, a recent story. They've never made a mistake. Keep in mind, we're going there in March. No, you're right. Perfect. No, okay. This is a minor thing, But so China has a massive real estate bubble that you've ever heard about with like Evergrande collapsing. And this is many decades in the making where they would just build a ton of things. And a lot of Chinese citizens would put their money in real estate as like their retirement, like their savings. And it's been ever since the Evergrande pop in like 22, 23, it's been slowly but surely collapsing.

1:31:03And they've done a lot to like manage the decline and make it. But it's led to a real economic pressure in everything outside of manufacturing. So in China, their one bright spot has been manufacturing like EVs, drones, solar panels. They're incredible. And they've put all of their focus into that. And that's where the growth rate's coming from. But everything else has been really seen in a slowdown because of that still slow moving, almost like 2007, 2008 in America. But they like slowed it down and stretched it out. The reason that thing popped initially is because Xi Jinping announced what they called the three red lines, which is new rules because they saw how crazy it was getting, how much debt was being thrown into the thing, how much borrowing, how insane the valuations were getting.

1:31:43It was like Canada level in China. So they announced three red lines, which banned real estate companies from doing certain things like having too high of a debt to income ratio or whatever. They did this. And the second they announced that Evergrande explodes, everything starts popping. They freak out. They print some money. They try to slow it down. As of like a week ago, the overhang, the pain, the economic malaise from this has been so bad for so many families. They recently quietly stopped that. They got rid of the three lines. They're kind of tacitly admitting the fight is over. We're going to let things kind of reinflate again.

1:32:17Like let the real estate companies reinflate. Yeah. Because I thought what they were doing was pretty, like they were taking the pain. It was painful, but it was smart because people do want real estate to go fucking down. but now they're like we we can't stomach this pain anymore they're kind of getting rid of it so i will say like they're not you know they're human like they have they're even in a state where they have no other party there's still political pressure there's still anger there's still they're still responding to some things in a way that all human politicians do all over the country all over the world so this is an example a story that i think is underrepresented of of the complex cities of what's going on in china um well i think that's the this episode of lemonade

1:32:57Aiden:stand. If you want to join us for an extra hour of the show on Patreon, you can go to patreon.com slash lemonade stand. We also have that book club episode. We just came out, uh, just came out with today. So it'll be out when you're listening to this and we'll see you guys on the main show next week. Thanks for watching.