Mission Accomplished | Ep. 053 Lemonade Stand 🍋

17:05Atrioc:Yeah. I mean, one of the things that's so weird. So now the question is like, what is the off ramp of the war? I think pretty much nobody is stoked about the idea of is continuing for a long period of time but then like how do you declare it to be over and then at it's exactly what you said at this point there's no indication that the regime is lost and they just installed new supreme leader mojtaba kamene i'm sure i pronounced that well who is probably nailed it yeah from isaac saul from tangle quote is more hardline than his father younger avoids public appearances and just had his wife mother father a sister and a child killed in U.S.-Israeli strikes.

17:45Atrioc:Do we expect to be able to make peace with this guy?

17:48Aiden:So I think there's a juxtaposition here of the U.S. government having a success, quote unquote, in Venezuela, and then feeling that maybe they empowered to take action elsewhere in the world. And the difference, I mean, it feels almost impossible for them to not understand that this difference would exist, and maybe I'm naive for thinking that, but in Venezuela's case, it's like we captured a foreign leader, new person came into power that we wanted to come into power and we now have, at least at a government to government level, like a stronger relationship with Venezuela than we did before. We have like some sort of leverage over that government and also the underlying system in Venezuela hasn't shifted or dramatically changed.

18:43Aiden:Albeit there's a lot of time for things to play out and we'll see how this change affects the country, if at all, for the average person there. But in this case, right, it's like new leader installed, not necessarily by us. He's been assigned into the position and the government is clearly not on good terms with us. It's not playing out the same way at all. So even in this best case scenario where you like believe the intentions of the US government in both of these scenarios. Let's just like say we exist in that world. It's not playing out how you would hope at all. Yeah, so I mean, from like a game theory perspective, Iran, you know, they lost this military.

19:25They're not gonna, you know, they've lost air superiority. They're not gonna win the war in any conventional means. But my understanding is that they are trying to damage, make this like such a bleed economically. They make the pain so much that because if they were if they were to agree to ceasefire an hour and surrender, the thought on their side would be that the U.S. and Israel would just resupply, refuel and then probably do something like this again. And so my understanding is their goal is they have to drag this out as much as they really can to make it so that this is not attempted again because the pain was so high, the economic pain, the backlash, the political pain.

20:00like even they have people from the iranian uh state media apparatus like tweeting to americans about how you're gonna have higher gas prices like they're putting out you know they're putting out this kind of like that's the messaging they're going for they're going for like almost a vietnam style where it's like we're not gonna conventionally win this militarily but the damage at home will be

20:19Aiden:so high i'm kind of wondering so a couple of the things i've read in reporting is there's kind of this race with the straight of hormuz to like get it back in action as quickly as possible And part of the way of doing that is U.S. ships have, and maybe the Israeli Navy as well, has destroyed over 40 ships in the Iranian Navy. So they're trying to deconstruct the apparatus that could enforce the blockade on the strait so that these painful factors that will influence the opinions of the Gulf states and other allies in the region from getting rid of that pain as quickly as possible so Iran doesn't have that piece of leverage anymore.

21:04Yeah, but here's the problem. It's not a conventional navy that's blocking the Strait of Hormuz. It is the fact that they can set up like you can weld together these drone launchers and put out a$10 ,000 drone. Yeah. And one of these drones can stop a tanker or blow it up. And so the risk reward is so stacked against it that nobody will ensure a tanker to go through the strait. That's why even though China's vessels have been given, quote, safe passage by Iran, they won't go. Nobody is going through the strait except for a few very risky ships that are like turning their transponder off. To the love of the game.

21:38Atrioc:I'm sick of people who just do it for the money. Yeah, they're doing it for the love. They just love the thrill.

21:42Aiden:Did you guys see this at all? I was curious if this point came up because a handful of people recommended watching Professor Jiang's videos about this. He's like a game theory guy. And he really emphasizes the point about desalination plants in the Gulf states because there's kind of this resource war of water between Iran and these other states. and how if they attacked desalination plants, this is a huge area of risk for these places. None of these desalination plants have been attacked so far from what I can see. I was curious if you have any thoughts on that because people kept bringing it up.

22:21I think that's a good point. I mean, it's weird. I watched that guy and he says a few things that are really cool. And then he just throws in a truly crazy thing every fourth line. And so I don't know what to think about him.

22:32Aiden:Do you have an example? An example was he's like, the US and China will both fall and the great powers of the world would be like Germany and Japan. It's like, I just think there's no... You're the only one saying that.

22:42Atrioc:Oh, I'm sorry. Germany's on the rise. I don't know. It just seems like, where are you pulling that from? It just seems so... Guy who doesn't read. Yeah. Guy who just hasn't read a lot of fucking books, I guess. I don't know. And he's got a couple of other crazy lines that I'm not pulling off the top of my head. So maybe he's got... I mean, he did correctly make a good prediction on this war in Iran, so... But anyway, I just thought that risk... That point is interesting.

23:04Aiden:The note of the risk was interesting to me because I hadn't thought about that part and those places aren't under attack yet. I did want to share something with you guys. So I have a close friend who lives in Kuwait and he was just sharing his perspective on what's going on right now because they're one of the places that has been hit in Iranian strikes. So Iran reports that they're only attacking military targets in these places, right? But he did say that while this is a claim and they are primarily hitting like US bases in Kuwait that they've hit a place like the Public Institution for Social Services like a government building that handles retirement payments, pensions and other financial services to like orphans and widows.

23:51Aiden:And that place was hit and a few like civilians have been injured. And during the early part of the war, like the initial reaction, the sirens were going off like very frequently. They could like hear bombs or strikes very frequently. It's apparently like petered off in the last week. And he said the reaction on the ground isn't necessarily like, the average Kuwaiti isn't very like pro-US. They're very anti-Israel, especially in Kuwait. He noted that even compared to other Gulf states, he thinks like anti-Israel sentiment is particularly strong there. and that there's a real sense of like Gulf unity right now.

24:35Aiden:Like we stand together as the Gulf states and like want the wars to end as soon as possible. We don't want to deal with this. We like stand with our Gulf brothers. It was interesting just getting his perspective as someone who's like living a bit more of it right now. Obviously comparatively removed to someone in Iran, but on the other side of it. I mean, my understanding is that all the Gulf states were, you know, those cities out there, a lot of them were thriving and growing, especially in like tourism and banking for regional, like a lot of people are, like people were starting to flood places like Dubai, but other cities around there.

25:14And this is obviously hurting the narrative of like, these are safe, great places to do commerce and business. And that was growing. So there's like a real push from a lot of people and entrenched powers. all over the Gulf of like, hey, this needs to end. We were on a great path and everything's fucking it up.

25:31Atrioc:I guess the counterpoint, so the view I've seen expressed is the realistic end goal is that the US and Israel just destroy the shit out of as much of Iran's military capacity as they can, and then they leave. So like a quote, this is from Arab News. Again, I'm going to hit this flawlessly. Abdu 'l-Rahman al-Rashad. Brushed it. In the coming weeks, estimates suggest that the remaining elements of Iran's weapons arsenal, along with its factories and military institutions built over three decades will be destroyed this could grant the region a reprieve from iranian threats for perhaps a decade in which a weakened but surviving regime attempts to rebuild its capabilities apparently there's a lot of people who are like look that's okay you know folks in like the gold states for example who feel like iran has always been the kind of crazy person across the water and that this if it stops them from being a threat for like 10 years maybe like even that could be good in some senses but that's good like it's what you're talking about right which is like yeah can they secure like if this ends really fast and at the same time stops iran from being able to shoot missiles and fund a bunch of insurgents all over the place maybe they're happy with that yeah maybe but you go ahead okay i would say i have kind of a question to that two things that tie into both what you said is you mentioned um you know the initial reaction from iran was kind of like willy-nilly firing missiles all over the gulf

26:49Aiden:kind of as like a just primarily at u.s bases but primarily u.s bases but it was you know i mean hit hotels in dubai possibly u.s soldiers were staying there but like it's a hotel people are well that's sorry quick interjection kuwait friends said that they also hit a commercial port in kuwait and the claim was that u.s troops were there right that isn't necessarily like even from a kuwaiti perspective that isn't necessarily true lunch so hmm like they were shopping like no they were like a like a like a port like an oil port oh i was imagining like a like a fish market No, no, no, no, no, no, no, no, no, no, no, no, no.

27:21Aiden:Sorry. Anyway, anyway, keep going, keep going. Sorry, so they hit all these targets. And they've been seemingly getting more precise on US military targets. And there is a sense that possibly, this is the claim, that Russia has stepped in to help with targeting. Like they're giving them satellite reminder. No, they've said openly that they're giving them. Well, Russia said they didn't do it. Oh, okay. Russia's claiming otherwise. But there's a sense that they did do it, which is kind of an act of war in itself. Like Russia, that kind of elevates the stakes outside of just Iran because it's now a major power.

27:53Russia's the bad guy.

27:54Aiden:This is from a New York Times thing today, but I had seen that it seemed like Russia had come out and said that they were providing the Iranian government intelligence and also that this isn't really that big of a deal because they've been providing Iran intelligence for a long time. And that's like, well, I understand. The Journal said Russia secretly sharing locations of U.S. targets with Iran, U.S. officials say. But then Russia told Trump directly, this is him and Steve Wyckoff saying, it has not shared intelligence with Iran during the war. Okay. And that's the more recent, that's seven hours ago.

28:30Aiden:Yeah, yeah. So they're saying it didn't happen. You didn't read the one from three hours ago? I just... I told you this guy doesn't read. Yeah, I don't read. Yeah. That is an escalation. But what I'll say on what you said is that there's a worry... that if nothing fundamentally changes on the ground, you know, this is an egregious act of war. Like, they now are going to be full speed ahead. The second things are stabilized. Much more motivated to. With Russia and China, both motivated to make sure that they are well-stocked with missiles, well, you know, completely to reset up deterrence capabilities, and possibly nuclear again.

29:06Like, there's no sense that the new Ayatollah or Iran is going to be like, all right, well, all right, we're.

29:14Aiden:Okay, this is my big question, kind of off the back of that and what Doug had said, is as this is happening, Israel is also getting more aggressive in Lebanon with the claim that they're helping further dismantle Hezbollah and their integration into Lebanon, right? And then they're attacking Iran. They're attacking Palestinians. Like I've recently watching like more of the post-October 7th life in the West Bank and like the degree of like checkpoints. And I would say apartheid living conditions in the West Bank. And Gaza like completely devastated. When, what is the end goal? Like even if I took Hezbollah in Lebanon, right?

30:03Aiden:They did that walkie-talkie attack where they supposedly decimated Hezbollah, which kind of makes sense from the reporting that was even told on the Lebanese side. When is enough enough? When is it end? When have you won? Like, are you going to kill? And even in Gaza, it's like you've leveled the place entirely. You've killed so many people. And the aggression still hasn't stopped. There isn't this like glowing rebuilding of that place or something. I just don't understand from an Israeli perspective. Like when will you ever stop attacking people? When will you know you are safe if this is, if you continue to take these drastic violent actions?

30:49Aiden:I don't know what the end of it all is. I think they thought this was this. I think they thought because most of those things you're talking about are proxies that were funded by Iran through their oil money. Sure. And I think they thought this was it, but it's seeming more like, I'm talking about from their POV. Yeah. Like this is a, this is, this is not going to work that way. Like it's just. Yeah, you're attacking a country of 90 million people and the citizenry that you've supposedly supposed to rise up and like flip flop things isn't fucking doing it. So now what? Yeah, yeah. It feels like, yeah.

31:19And I genuinely am seeking the answer to that question. You know, I think Israel would like US to do the heavy lifting on this, but it feels like Trump's patience is really, you know, he's a guy changes his mind quickly when there's market pressure and is also generally doesn't hold attention on the subject very long and it already seemed like his last press conference you know he he said both sides of his as both but the tone of it was that he's like this is about to be over everyone relax like we're he clearly would like to move on pretty quickly and so yeah from from israel's people like what they're just stuck they've made all this chaos and enemies and then the U.S.

31:55is going to bolt and run. They're going to get out pretty soon. If gas prices are above$4 consistently, even if Trump didn't do anything, the midterm sweep will be so drastic, they could also lose the Senate. Nobody wins an election if gas prices are above$4 consistently. It's going to be a bloodbath. So I assume that's impeachment talks. There's all these next level effects that'll happen if this holds. So anyway, I don't know if you guys have any final thoughts on Iran. We do have a major topic on housing that I'd like to get to. Yeah.

32:24Aiden:I had everything any thoughts

32:27Atrioc:no it blows you know something that just for people who aren't American or even are American who maybe forgot you're supposed to have Congress declare war you're not supposed to do this oh this is okay so you know the way it should work is that a president can do this and then you have 60 days to wrap everything up and then an additional 30 to like get everybody out but apparently that's not very well enforced. I have not looked into the exact history of it. But just a reminder, when we went into Iraq, we voted. Congress voted. That's supposed to happen. It's not supposed to be the president can just decide to bomb countries.

33:06It is well in my lifetime seeing these two different conflicts, Iraq and Iran, both of which are seeming to be ill-advised quagmires. But Iraq, they went through so much effort to try to sell it to the public. they you know they had they marched out colin powell to the u.n to talk about wmds to every nation on earth they had they got congress to vote on it they they did every possible thing and i think you know no credit to bush on this but at the very least you got a record of which representatives voted for it and who didn't which is important you gotta you got it's tougher to say like oh we got into this blindly or whatever you know but when your president does it at 2 a.m via a tweet randomly.

33:47True social posts. True social, I'm sorry. It really does. It's like a much darker version because there's not even an attempt or a care to even sell the public on it. And again, the public at home, I wouldn't say they're as against it as I thought they might be. It's falling mostly along party lines, but it's not popular, this strike in Iran, and certainly will get less popular as gas prices bite. So yeah.

34:08Aiden:The last thing I wanted to mention was the Swiss defense minister, Martin Pfister, on behalf of Switzerland, said that the U.S. and Israel have broken international law with their attacks on Iran. So it's like, that's Switzerland. The famously most neutral country coming out and saying it. I think that's so funny, though. Saying international law is being broken lately is like saying the sky is blue. It's such a useless... International law has not meant anything for a few years now. Nobody does anything. It's because they're using...

34:42Atrioc:Weapons on cockroaches. It's because they're using cockroaches. Focus on that. We're mostly fucking close to following international law. Jesus Christ.

34:49Aiden:All right. Well, we want to talk a little bit about housing. We all wanted to come with a few different examples of how things are trending in good directions, how things in certain places are trending in bad directions. Back to the lemonade stand roots.

35:03Atrioc:Yeah. Why don't I start with a little kickoff of America and kind of what's going on with America. I think generally the three of us agree that building more housing is good. I would argue that we also feel, correct me if I'm wrong, fellas, that other things are good too. Like, for example, preventing institutional buyers from just taking up homes. And ice cream is good. Ice cream is good. War is bad. That, for example, I would support government building, right? So when we say building more homes is a good thing, which is generally my feeling, it's not like that's the only thing you should do and it's like ultra pro developer with nothing else.

35:38Atrioc:there's an article i like by uh no opinion noah smith it's called the left nimby canon and you can find it i'll raise my arms perry to show it uh this article i think is good it's a few years old but what i liked about this is that he makes an uh i thought you don't have to subscribe for this one but he makes an argument um that is backed he basically lists a whole bunch of different articles that show how building does bring rent down and even in the case where you're building market rate housing that market rate housing is going to absorb, in his words, yuppies. It's going to absorb the rich out-of-town people.

36:13Atrioc:And that means that those yuppies aren't moving into the more working class, poorer neighborhoods. So I point this out not to say this is the truth, but I think he references a lot of different articles that I think are good and worth looking into. And again, makes the point of like, look, we aren't like these free market absolutists that think developers should run roughshod over everybody, but it is a core, it's a core belief of Yimbyism that building more will drop rents. And even if you support government housing on a mass scale, as we're going to talk about, like right now, this is an article by the LA Times, Perry, that is, this is in 2022.

36:51Atrioc:So it's like, you know, potentially a little bit outdated, but affordable houses like per unit in Los Angeles are taking, or sorry, this is Northern California, are taking a million dollars per unit. So even in the context of like, hey, we want to really invest in affordable homes by the government and enforce this, our government is so unbelievably inefficient and so expensive at building these things that we aren't able to get the things built. So regardless, there needs to be changes, at least in the US, to making more things built. So I think that's sort of the premise. There's some interesting success cases.

37:23Atrioc:Let's start with Austin, Texas. Austin is notorious for having gone on this just absolutely gigantic building spree over the past couple years. They hit a peak where rent jumped 25 % in 2021 during the pandemic because a ton of people pushed there. And then they have just been going crazy on development ever since. And now not only have rents dropped dramatically as they've built an absolute shitload of units, they're 22 % off the peak. um the landlords like just basically have way less bargaining power and are having to offer all these discounts to people in austin um looking at some of the numbers uh yeah so almost 50 000 rental units were added to the city in 2023 and 2024 by contrast 50 000 by contrast in that same two-year period san francisco added a total of about 4 300 over 10 times the amount of new ones So Austin, Texas, which is a blue city, by the way, is like a success case of they've built a ton of housing.

38:27Atrioc:Rent has fallen dramatically. I don't know if they have... Let me go back. I just love that line. That line is the core of it. The rental marketer is saturated with availability. Landlords have almost no leverage. She has seen buildings offer three months free to new tenants and rate reductions to keep ones already in place. That is the core of why this works, man. I just think when there's so much competition for your rental dollar, they have to give you the best deal because otherwise you'll just go down the street somewhere else. And that is, I mean, that is just the, that is the best way. Like laws that restrict landlords are less effective at punishing landlords than just by making them having to compete with other people.

39:03Because when they have to do that, you literally can just ignore them. You can just go somewhere else and then they're desperate. If they're the only game in town and there's laws that say you can only charge a certain amount or whatever, they find, you know, it creates this black market where they try to find ways to get around that. And you're still stuck there. You have only one option, which is this landlord who may or may not be an asshole. But when you have a lot of supply, then it changes the math. And I have a graph here too, if you could pull it up, Perry.

39:26Atrioc:While you're playing it up, it's funny. In this same Bloomberg article, they're quoting like the landlords being sad. It's like the supply picture is really tough. No, that's what I'm saying. Out of Austin, they're all like the flip side of it is the homeowners and the rental owners are getting pissed right they they thought they were there's gonna be a gravy train people that bought airbnbs and try to do that in austin are getting hosed of the airbnb and it's like that is what upzoning does uh rental to income ratio is the cheapest it's ever been in austin right now which is like pretty awesome uh as progress oh do you know like top ahead are there any because for audio listeners

40:00Aiden:it was big now small yep there you go are i think in the last year we're at a time in the u.s where the average rent is declining for the first time in a long time right so what are the other do you know what the other notable areas or cities where this decline is also happening well not the exact

40:18Atrioc:answer to that question but there are there are positive developments happening here's three examples one in california last year we signed sb 79 i even went up to governor newsom at twitch con i shook his hand and he said do you want to take a picture i said no i don't care about you but i do want to congratulate you on thank you for signing sb 79 i think it's great and what it did is it makes it much easier and lowers restrictions to build housing and developments near transit stops, like big transit stops, which is crazy. The idea that the taxpayers will fund a BART station in wherever, and then the local neighbors will stop any housing from being built at that train station that we all paid for.

40:55Yeah, they were only allowing single family homes near train stations.

40:58Atrioc:I don't know. Have you guys ever gone to the end of the BART on East Bay? It's crazy. You drop off and it's like, it's like the most barren place. It's like, why the fuck aren't there skyscrapers everywhere there's nine story buildings i did this on accident at the first day of an

41:10Aiden:internship i had because i got on the train the wrong way and then i'm going in the clearly going in the opposite direction of san francisco after like three stops and it was near the end and i was like why there's no buildings around at all yeah it's wild we spent anyway so why didn't you get off and go the other direction shut up support for this show comes from tasty trade guys i'm getting real tired of you not knowing serious financial terms on this show okay steve eisman comes on and we can't even explain ourselves in the complicated financial ways we seem like chumps is bitcoin a money this is a problem aiden so i came up with a quiz to test you on your financial knowledge you're gonna tell me if these are real or fake okay these are financial terms yes the lady mcbeth strategy is that real or that's a chest opening that's not real that's real for sure it's real really it's real okay everyone knows that what about the uh what about momentum canceling momentum cancel that's from melee uh fake fake yeah it's from melee all right what about what about what about uh a broken ring butterfly that's gotta be it's too

42:20Atrioc:weird to be made up that doesn't feel like it's real feels like it's real that's a fair point okay it is real so you guys are getting some of these right what does it mean Let's not focus too much on the details. You know who could explain it really well? Probably like you. Tasty Trade, because they have an actual jargon library that breaks down these terms, help you understand so you can trade with understanding. Wow. Are you saying I could go to tastytrade.com slash lemonade today and that Tasty Trade Inc. is a registered broker dealer? That's exactly what I'm saying. You finally got it. Okay, I'm picking up on it.

42:52That's exactly what I'm saying.

42:53Aiden:And it's a member of FINRA, NFA, NSIPC. Well, hold on. Hold on.

42:58Atrioc:is it yes okay all right man thank you taste the trade for supporting the show

43:06Aiden:as you guys know we're going to china pretty soon we'll be spending two and a half whole weeks there with plenty of downtime because we all be always be talking always doing stuff and i'm going to be studying swedish while i'm there oh and and you could study swedish or a number of other languages which i'm going to be studying with babble we are going to china to study swedish and spanish with babble this is actually this is actually real i have to do my swedish uh i practice swedish every day and uh if you're looking for a way to start like studying or learning a new language you could check babble out doesn't matter the language doesn't have to be aligned with the country you're in be free there's no rules i think i'm gonna check your ip and go, you have to learn the language of the country.

43:53Shanghai is Little Sweden, I believe is the name.

43:55Aiden:A lot of people have said that, Doug. To start speaking a new language in three weeks, go to babble.com slash lemonade and you'll get up to 60 % off your subscription. That's up to 60 % off your subscription when you use our link. Join the millions of Babble learners breaking the language barrier every day and go to babble.com slash lemonade. Sport for Lemonade's Dan Combs from Shopify.

44:16Atrioc:Aiden, did you ever have a dream and you didn't have, you know, the confidence to know if it would work out.

44:22Aiden:I think I've had confidence. I've had some confidence in my life. You sound unconfident right now. I sound unconfident. You're getting less confident as we speak. Who is this character? I could start a business. I could sell things online. Like I did when I started at Mogul Moves. I was starting to work. I was selling clothes for Ludwig. And we had a Shopify account. A Shopify account that we used as the back end for all of the merchandise that we sold, mostly clothes. and I found out we love Shopify so much at Mogul Moves that we had two separate subscriptions under two separate emails that we'd been paying for years.

44:57Aiden:Now, I wouldn't recommend you do that, but you can sign up for a single account and use Shopify because it's actually a great platform.

45:04Atrioc:Or if half of the people listening could do that, that's also cool.

45:08Aiden:Turn your what ifs into a thriving business with Shopify today. Sign up for your$1 per month trial today at shopify.com slash lemonade. Go to shopify.com slash lemonade. that's shopify.com slash lemonade so we're making progress in uh illinois jb pritzker the governor

45:24Atrioc:did a push recently um it hasn't been approved yet but he's basically proposing this bill that is going to dramatically increase the ability to build homes a big theme that keeps coming up is zoning where people have set up zoning that only allows single family homes and then you just can't build more you can't build certain types and so there's been this yeah just for the audience of zoning. It's like an area of land of your city is only allowed to build a certain type of thing. And generally in most cities, it's single family homes, which is because that keeps the property value for other single family homes around it high.

45:54Atrioc:The character of the neighborhood. The character of the neighborhood. And so there's a lot of political pressure from homeowners to not change the zoning. This is just like, this is just a rule that stops people from building duplexes, triplexes, apartment buildings, anything else. And the Pritzker example is he literally said, all residential lots are effectively ending single family zoning and you could have duplexes triplexes and four flats on all these places so you know it is progress we're seeing progress like this in pockets all over the country not even left or right thing like i think there's a general consensus yeah it's it's bipartisan yeah which is fantastic and so and i think generally for for a long long time local homeowners have had the ability to shut all this stuff down and it was not politically tenable because if you're going to go try to get a law pass that says hey we're going to allow a lot more building and a lot more neighborhoods the people in those neighborhoods who are the most active voters and old people who are the most likely to have homes and be the most active voters are going to come out and strongly oppose it this sb7 bill or 79 bills like repose oh what a coincidence by a whole bunch of people in the rich neighborhoods in los angeles what a coincidence they're so concerned about the character of the neighborhood But keep in mind,

47:03Aiden:I think it's important to fight for the other side here. Put me in the villain chair. I was watching a news piece about Surrey in British Columbia in the Vancouver area and how there is an increase in efforts to build affordable housing projects. Often duplexes or triplexes in these areas, much larger buildings than a lot of the residential homes in the area. and this older woman came on the program and said that she doesn't like how the buildings look different and hang over her home. Good point. And I think about her and how the height of the homes near her might, it might fuck. Well, it's so tall you have to look up and crane your head.

47:51Aiden:It puts her building in a little more shade during certain times of day. Right. I feel like we're not. nobody's with me here we all steal man it uh do you think 2007 was or 2008 was a good thing you guys think the great recession was a good thing you think everybody getting laid i think war is bad you think the recession was good huh because that was caused by falling housing prices

48:12Atrioc:so think about that well that's uh that's like saying that the many many many refugees post world war ii is because there's falling housing opportunity you know there's not enough i do say all the time yeah but i would argue it's more because of the war that did that not the there was an upstream effect that i've only heard of world war one to give that a little a tiny piece

48:34Aiden:of credence right say you were to like maximize this effort across all places in the u.s as an example at the same time and then people who are heavily leveraged in real estate usually older people, and I'm not talking about companies, or I'm talking about oftentimes the major source of people's wealth is locked up in their homes or properties they purchased. And I'm not saying that it's fair that housing has been commoditized in this way. But if you do lower the value of all these places at the same time, there are like knock on economic consequences of that. Like people, when they feel less wealthy, they spend less money, they maybe don't have their retirement in that, like this is their primary nest egg and their retirement isn't spread across any other type of asset.

49:28Aiden:I'm not necessarily saying you have to feel bad for these people, but understanding that there can be a negative economic consequence from this type of policy making in the long term or sorry, in the short term, that we, I think we inevitably have to fight through in order to arrive at a more balanced housing market that is fair for more people. Like there has to be some sort of pain for somebody. And right now, a smaller, older pool of winners gets to be happy about the current situation. And most younger or working class people cannot afford places to live. And that's the broad problem that needs, there needs to be some sort of give on one side of this yeah i mean that's yeah it just needs to

50:14Atrioc:be balanced like housing has gone up i forget the exact numbers i'll need to check but just like a crazy amount of the last 10 years something like 73 percent like i'm sorry that's too fucking much yeah like that if you're a homeowner i like obviously the our society at least in america is set up to like where that's your primary investment vehicle but it shouldn't be the idea that it's unfair if we ask you to lower your home prices, even though it doubled in the last decade or two. Sorry, if it only has gone up like fucking 40 % over the last decade, that's an insane return. I don't know about the exact numbers, but God, it's so ridiculously out of control.

50:52Yeah, I agree with all this. I mean, we've talked about this on the show many times. I just, you know, I think people need to be ready to understand the scale of the pain is real, it will not only hit, it will hit everybody. And that's just, that is what it has to happen. Like if, if housing prices were to materially correct, like I'd say, you know, 20, 30 % drops nationwide, it would be a recession level event. There would be massive job loss. It would be huge slowdowns in spending, and it would be a pain that would, I guess, primarily hit these older wealthy people, which is good. And then we can find a way to work through.

51:28But the slowdown that's happening, for example, after the ever grand implosion in China, which is currently in two years of falling housing prices, the impacts of that are real, especially outside of the major tier one cities where there's a lot of export growth. Most people, and China really doesn't use a thought market. They don't have 401ks. Most people invest their retirement into housing. They would buy a very expensive apartment in the city or a house in the city. And those have been falling and falling and falling. And the propensity to spend has gone, I mean, it's completely gone. Like it's really, really slowed down the part of the economy that's not exporting EVs, solar panels, whatever.

52:07And the pain from that is real. Like that is the type of thing you'll feel if we do that here. And we have to do it. And I actually commend China for trying to pop the bubble and like slow it down. But that is, I guess people just think it'll be easy. Like if we just, and it's not gonna be easy.

52:22Atrioc:I would really feel for people who've bought a home in the last five years, right? But for somebody who has held homes of any kind for like the last 10, 20 years in almost any area where these prices have skyrocketed and it's become unaffordable, it's like, sorry, you got to take some pain. We can't have the younger two, three generations take all of this pain. This is absurd. But yes, like you said, I mean, the people that bought it the last five years, post-COVID house buyers, primarily millennials. who stretched a bit to get a big fucking loan. As a homeowner then, or as a property manager, you scumbag.

52:59Atrioc:The landlord who has 12 slum tenements.

53:02Aiden:Oops, next month I'm raising them again. Can you imagine Aiden comes in with that face and raises your rent? I would... Murder, suicide. It would be murder, suicide. And I'm pretty sure the only person living in your place is your

53:17Atrioc:girlfriends you do you up charge her rent every month oh yeah babe sorry it's up again she pays rent she pays rent oh she pays right you've been double charging her all right wait so all right so here's a question all right you have bought recently presumably you bought yeah not just for the love of the game like an oil tanker captain but also because you thought it would go up in value over time are you okay with the idea of your property goes down in 20 in order to correct the market uh yeah yeah so funny if you said no though no no not me i would assume you're not

53:48Aiden:stoked about it so the thing is if i it's like i got in yeah i got on the ladder by by podcasting and it's like i want i look at all these young people around me they aren't starting podcasts what are they doing and i'd rather pull the ladder up yeah to the moon baby no shit i yeah i i think i genuinely if uh if rents in like los angeles went down by 20 percent or homes i mean like just straight up the value of homes went down by 20 percent and uh i could yeah i'd be happy with that but i'm also in a i would say a privileged situation where i do not have the bulk of my income in my, or sorry, the bulk of what I have in my home.

54:37It would be, you know, it'd be painful for you. Because I think for people that, the thing is, people that are not hurt by this too much, people who are at one property, they plan on living in. But you're going to sell eventually pretty soon to go to Sweden, right? So you would take a hit if it fell now. Yeah.

54:53Aiden:I think the thing is like, I think I would say that no matter what, because it's something that I understand and I firmly believe it, right? But I think it is hard. And don't get me, this is not me. I just want people listening to remove the Aiden of the situation because my situation is different. But I do think I know people in Los Angeles who are sort of like in that high middle income bracket who have like worked for like the dinks of the world, the double income, no kids, who both have like high middle income jobs who have saved a lot of money and then kind of all into their money to buy a home, and it is all they have, I think it is hard for those people because they barely cracked it to make it work, and now everything is in this one thing.

55:44Aiden:And if your situation is that, I have more empathy for you. I have a lot of it. Because you're just trying to fucking own a home, and you manage to make it work. You were born into this game, and you played it as best as you could, and you tried and you scraped and you saved and you found a way to do it. But the game is so rigged and bad that people are going to have to change the rules and you're going to get fucked. It's like the people who all-in the taxi medallions in New York at the worst time, right? Those people, they took on huge loans, much like you have to, to fucking buy a home. They found a way to get a down payment on the medallion, which skyrocketed over a million dollars.

56:23Aiden:For people who don't understand the context, to drive a yellow cab in New York City, There's a limited amount of medallions that allow your cab to operate. And because of that cap, the prices of these things skyrocketed. And prior to Uber, a medallion to operate a cab in New York City crossed like the million dollar threshold, if I recall correctly. And what people would do is take on enormous amounts of debt in order to buy this medallion and become a cab driver in New York City. but then Uber and these apps like came into the market, completely changed the dynamic of how these things work and the value of these medallions crashed.

57:00Aiden:And it's like, you can... You know, say fuck those guys. They all end on a bad investment. But I think there's an equivalent of that in housing where I'm not saying things shouldn't change. I think it's so important. We have to create change and there has to be pain somewhere. But I know people in my personal life that scraped by and found a way with their pretty good jobs and their conscious saving and they're not incredibly wealthy people who managed to buy a home in a cheaper area of LA and that's all of the money that they have. Like, it's gonna hurt for them, of course. And I hope, it's like you need to provide, in the same way that the, like Mumdani brings up the cab driver thing a lot now, in the same way support, I think should be provided to those people, you need to find ways to ease the pain for people in that spot.

57:50Aiden:I don't think the pain should be eased for people like me, because frankly, I don't need it. It's like, I just. I think you should increase the pain on you somehow. I don't think we need to increase the pain. I think whoever the next politician is should promise to hurt you again. okay all right could i could i posture actually you you guys go you know you set up a posture i have to know what you're posturing well i have i have an interesting defensive position i have housing things take take take so i looked at two international examples a while ago we made an episode where i talked a lot about vienna's housing model and for those who aren't familiar vienna breaks down their housing into like social public provided housing from the government partially subsidized government housing and then private housing sector.

58:31Aiden:And by providing a lot of supply in all of those areas through different means, they've managed to keep rent very low in Vienna compared to a lot of large European cities. Helsinki in Finland, turns out they do something very similar. And Helsinki owns 70 % of the land in the city, which is insane. Nowhere near what most cities own of their own cities. And because of this, they have like ordinances about development and basically like 25 % of new development needs to be allotted towards like fully public or social housing where there's like a limit on basically like you can't run like rent for profit and they that's uh those areas still get developed and then like 30 % of development is like partially price regulated and then 45 % is totally private sector and they have over 60 ,000 social housing units in a city of less than 700 ,000 people and this dynamic is part of what keeps rents in Helsinki relatively affordable compared to a lot of European cities.

59:33Aiden:The average is like 1250 euros a month, like 700 for a studio. And I thought that was interesting because the execution of this plan is very similar to Vienna's. And I think the value of this plan is that you have a public nonprofit motivated way of building housing that competes against all of the private offerings on the market. And it's like private housing can still exist, but if you have a large enough percentage of the market that is not profit motivated competing against the private offerings, it forces those private rents to compete against the public options, especially if you keep the supply of those public rents widely available.

1:00:18Aiden:And that's becoming more difficult over time. They are struggling to keep the socialized housing like uh available and it's increasingly like becoming a lottery system over time

1:00:28Atrioc:uh like they just aren't building enough or what yeah they're falling behind their goal of like

1:00:33Aiden:units built per year they're trying to build like 6 000 to 7 000 units per year and right now they're

1:00:37Atrioc:only building like 4 500 and this is the government on their own land yeah the government is it still

1:00:43Aiden:contracts with companies okay and the reason companies sign up to do it is because the developers have a guaranteed amount of profit built into their contracts still and then because the public housing is in such high demand, their project is guaranteed to pay out. So there's still a motivation from a developer side to get involved with the city. And I thought, you know, it's just interesting. I just think there's this general sense, especially I just feel like outside of maybe East Asia, I think it's really time, but like most Western countries, it feels like what they've lost the ability to build, to reliably build things quickly and on time and on budget.

1:01:29And like it, you know, we see this most in America. I see this in California all the time, but it's happening all over. Like it, it just feels like that. I don't know if it's because the web of laws has restricted it in some way, or if it's just a loss of practice or capacity or whatever it is, but like, you know, fifties America built massive highways on time and on budget. We built like all the bridges we built. It's like crazy. It was trains and now we can't build these things. And it's just so, so slow and hard. So I'm, I'm sure it's a complex nuance thing. We've talked about parts of it before, but it does feel like one of the biggest obstacles, especially to get people to even trust, you know, in your example, I think that's a snowball effect.

1:02:14People trust government to do something, then they do it well. And then they're like, oh, I want to do more things. And whenever you, it's, it works both ways when it doesn't work, when you throw money at it and it doesn't work, people trust it less. And so, yeah, I don't know. It's a, it's something that I think a politician would do well to solve. I like what Momdani has been trying to do to be open and honest about costs and try to get things that people feel a material impact. But I think it takes, it's going to take time and wins because people at this point are at the lowest level of trust in this kind of stuff.

1:02:42Yeah.

1:02:42Aiden:I mean, in the U S as an example, right? So social housing has such a stigma behind it to begin with the idea of like being on social or public housing, uh, has a very different meaning in a, in this context versus like one in Vienna or one in Helsinki where these buildings are like way more normal to build in. They're like very nice. Yeah. Higher quality. Yeah. Which, which affects people's faith. Uh, that stigma also affects people's faith in like that program being rolled out or something like that. I thought a different example of housing gone wrong. Do you guys know much about Hong Kong? Not really.

1:03:20Aiden:Do you know that it's like the most unaffordable housing market in the world by like a pretty wide margin? I had heard that. Well, isn't it like, is it really? I thought it was up there with some Canadian cities. No, Hong Kong has got all of the Canadian and Australian cities beat out. Hong Kong has the most skyscrapers in the world of any city. They have like over 500 skyscrapers. And it's a pretty crazy juxtaposition of like this endless sea of skyscrapers backed onto like green mountains and nature. And it almost feels like there's no in between like when you look at the city. And part of the reason, when you actually look at the land of Hong Kong is that it's relatively underdeveloped.

1:04:01Aiden:And Hong Kong, similar to, you could say similar to Helsinki, owns the land of like the entire place and more than Helsinki. But how they handle this is there's no, there's, excuse me, not no, very low income tax in Hong Kong. And the way they primarily raise revenue for the government is by leasing land to developers or landowners on these like 50 year time leases. And because these are so limited and there's so many people there and there's so much business opportunity there, the value of those leases has exploded. And that makes everything more expensive. Like by square meter, it's incredibly expensive to be in Hong Kong.

1:04:45Aiden:Even anecdotally, like I know a lot of people who live there, the apartments are usually incredibly small. Even like I have one friend whose family is insanely wealthy and they have an apartment that is like maybe twice the size of the studio we're in, which I don't know if that's great context for audio listeners or even for people watching. Audio listeners were in a giant 6 ,000 square foot warehouse. I don't, Perry, do you know how many square feet the studio is? The lemonade stand compound is massive. Why don't we not say that,

1:05:12Atrioc:but imagine what you can see and multiply that by about five is the amount of space.

1:05:16Aiden:Yeah, I think like there, I'm guessing, I would say my friend's place is probably like maybe 1 ,800 square feet if I had to take a real guess and it's in like the central part of Hong Kong and that apartment I think is like$10 million. That's crazy. It's fucked up how expensive it is. And the way they approach this, they intentionally choke the supply to explode the value of these leases because they have plenty of space to develop. But it's the primary source of income for the government and they don't want to raise taxes because the amount of like wealthy people and businesses that operate there.

1:06:00Aiden:so they're just in this chokehold where this is the only way we get money we have to keep expanding the value of these leases we don't want to give any permits for people to build and this is the complete opposite approach where it's like we limit building as much as possible even though we own all the land and we use it to to maximize the amount of funds yeah it's bad it's i have a graph here uh perry you were totally dead on aiden hong kong worst in the world surprisingly i didn't know australia had beaten uh vancouver here sydney is number two San Jose number three. I lived there. I do recall.

1:06:33It's so cool. Even, you know, I think I hit the fucking lottery working at NVIDIA. I remember I was thinking about whether I wanted to stay there or move. And I was like, one of the factors of that, other than hating San Jose, was like, do I really want to spend this amount of money? And, you know, it was just a disgusting amount of money for a small little home here in San Jose. It was disgusting. It was. I think it's just insane. And I can only imagine on a job I had before, like a regular. I don't know. but just respectfully, San Jose sucks balls. It does. No, not respectfully. You know what the difference?

1:07:04I don't like this list of cities.

1:07:06Aiden:Look at every city on this list. I think I've been, I think I've been to like, like most of these places. Yeah. Dude, San Jose is the worst place. Dude, culturally out of all 20 of these, it is by far the bottom tier. It's crazy. It's the third highest. It's the third highest. It's insane. And it's only because it's near all these big tech companies.

1:07:24Atrioc:For people who are not deeply aware of California, it's right below San Francisco. This is the major city right below. So it's like Silicon Valley. It's awful. SF is beautiful. It's my favorite city in the world. San Jose is if God took a shit.

1:07:36Aiden:Oh my God. If you haven't been there,

1:07:38Atrioc:after working on the beauty that is San Francisco.

1:07:40Aiden:If you just, I want you to imagine the worst place you've ever been. Okay, it's not that bad. It's just boring. It's just really boring, but really expensive. And imagine it's the worst place you've ever been, but it's just there's single family homes everywhere and that's all it is, as far as the eye can see. Single family homes and tech companies. But there's nowhere to go. Nothing to do. You can't do or buy anything. And everything's expensive. You can't hang out with anybody.

1:08:09Atrioc:Yeah. You have to understand how hard this is for tech people. You're paid hundreds of thousands of dollars and then you have to spend a lot of it on rent. Show some sympathy, Jesus Christ. Show some goddamn sympathy. My understanding, by the way, I don't know if you have any insight into this, but my understanding is that, you know, Canada is also at crisis levels in many major cities for housing. You're shaking your head. No, it's all good. No, but because it's been a crisis, I'd say about two years ago, there has been a similar thing to what we're seeing now, which is kind of like a, a, a focused, desperate attempt to be like, we have to change something.

1:08:46And there have been, see, I'm not super well versed on the specific laws, like SB 79, but there have been a forward motion. in Canada to change zoning, to get building going. And they've been like moving kind of quickly because the problem is so severe. You know, Canadian incomes are lower and prices are higher on average in many of these cities. So people are like, it literally makes, you know, we're talking about people who like, they kind of did everything right. They're doing like no kids. They were able to get like the almost doesn't exist in Canada at some levels. Things are so expensive.

1:09:20You just kind of don't have a way unless you're already wealthy, you're left money, or you get incredibly lucky. Like those are the only three ways to like get on the property ladder in a major city. That's the good thing.

1:09:28Atrioc:And that's like, that is a takeaway from this. It, things are finally changing. So Scott Wiener is one of the California legislators who've been pushing for housing bills for a long time. And basically they just get shut down. It's been going on for, I don't know, 10 years, something like this. And SB 79 is the first major one that actually got through. And that was with, again, like mayor of LA coming out and saying like, we're strongly opposed. we feel like local neighborhoods should keep the character and it's you know the normal the normal opposition and like we finally got something through illinois the mayor of illinois to say we're like i'm pushing it hasn't been approved yet by legislature but i'm pushing to remove zoning essentially in in many capacities and then you know if you pull this up like mom donnie like one of his big things is about building and it's just this i bring this picture up he met with trump we talked about this this was two weeks ago he went to trump and so the background here is that they're like right east of manhattan in new york city there's a giant train lot that is just not being used i forget what is the name of it um it is the sunnyside rail yard in queens it is crazy to look at a map and just see this huge undeveloped land it's used by trains right it's a train yard but it's it's wild in like one of the most expensive areas and for decades people have been trying mayors have been trying to get something built there and so uh mayor de blasio tried to build it, got plans.

1:10:48Atrioc:It couldn't go through, but now it's like getting more momentum. And then, you know, mom, Donnie goes and talks to Trump and says, Hey, here's what the newspaper would look like. If you approve and give us, I believe it's$21 billion in federal federal funding to cover the train yard over the top. So it's still usable. And then we'll build on top of that. And the reason it's particularly notable is because the paper that they printed out for this photo shoot is mocking an infamous, infamous paper from the New York Daily News from 1975 where our hero, President Gerald Ford, said to the city, Ford to city, drop dead.

1:11:24Atrioc:Vows he'll veto any bailout. We finally got Gerald Ford on the pod, in a way. Well, I feel like this is the spiritual successor. We're carrying on his legacy. You know, I looked up, because I thought it'd be a funny bit. I looked up Gerald Ford impersonators. Just not the writing margin. understand that doesn't make any sense that's one of america's famous and most successful president yeah he did nothing but win apparently chevy chase did a really good gerald ford back in

1:11:49Aiden:the 70s on sns we lost him we lost him well we can't really get him i don't think chevy chase

1:11:54Atrioc:will do our pod so we'll reach we'll try to get like we'll hit up all our contacts we're trying to get chevy chase on the pod and when he finally responds we're gonna ask him to be like hey it's just to do a gerald for five minutes actually i don't know why i said it's very good it's famously bad apparently gerald ford tripped once during a press conference and that's the only aspect of him that Chevy Chase does. He just kept being clumpy. He was his normal voice. He just tripped a lot. Best part about Gerald Ford, he never won an election. It's so awesome. He just kept, the people above him just kept resigning or dying.

1:12:25Atrioc:He just kept moving up. For the last 10 years, everything in American politics has basically revolved around one man. And as a political journalist who came of age during Donald Trump's rise in 2016, I've had a front row seat.

1:12:41Aiden:I am officially running for president of the United States. It's going to be only America first. America first. Thousands of supporters of President Trump stormed the U.S. Capitol building.

1:12:58Atrioc:But is it possible to talk about politics without talking about Donald Trump? That's the question I'm going to ask in our new show from Vox. The idea of like a post-Trump or not exactly Trump-focused show can exist because he's not really driving any agenda items. It really does feel like so reactive. You know, I think this Iran thing is also going to cause a big split in the GOP. So far it doesn't among like people who say they're MAGA voters are still with Trump. But like for the first time, you see on a major issue open opposition from the start of this war. I'm Estet Herndon. And welcome to America Actually.

1:13:34Atrioc:Hi, I'm Brene Brown. And I'm Adam Grant. And we're here to invite you to the Curiosity Shop. A podcast that's a place for listening, wondering, thinking, feeling, and questioning. It's going to be fun. We rarely agree. But we almost never disagree. And we're always learning. That's true. You can subscribe to the Curiosity Shop on YouTube or follow in your favorite podcast app to automatically receive new episodes every Thursday. Okay, I think it's a good, cool segue to talk about prefab homes. So I was looking into like, what are some ways that maybe people in the West are actually going to speed things up?

1:14:08Atrioc:Perry, if you pull this up, prefab homes are basically the idea that instead of having a team of constructors go to a site and you build everything there, you build many of the parts and as many as you can essentially in advance in a factory. And then you ship them there and you sort of construct it there and it cuts way down on these costs and shipping times and has all these interesting benefits. And so if you look at some of the other countries that are successful in this, one is Japan. So there is this study that was done by Australians, and I'll pull it up. We'll link it in the description, I guess, that looked at all these Japanese companies who do this.

1:14:44Atrioc:After World War II, they were so desperate to get homes made. This is by MDPI. So desperate to get homes made that they did a ton, a ton of prefabricated housing. And that has become a huge part of the Japanese housing where something, I believe it's like 13%. It says here in this article that you can pull up, Barry, that it's a huge part portion of what they're building is these companies that do these pre-made things and show up. Yeah. 13 % of total residential construction started in Japan. Weirdly, unintuitively for these three companies, it actually is more expensive than having them build a home.

1:15:21Atrioc:But the idea there is they're working with you a lot and really customizing it. rather than just, they just show up and like make the exact same thing every time. I reached out to Seadog and he said that when he had been like looking into potentially buying a home in Japan, that was an option for him where he was like, yeah, you can do all these prefab options where they're going to come in and just like build a house super fast, way cheaper, way faster. Or even if you go with one of these like fancier prefab companies in Japan, like it can be really nice on top of that. And there's all these benefits where they do super high quality, like quality assurance in their factories that could be really cool and then uh germany the first wave of those was like pretty bad right but they've gotten so much so so here's here's the thing so germany is an example of them not being great where post-world war ii not great prefab homes i thought germany

1:16:09Aiden:japan wanted to take over the world professor jean is wrong no no here's why he's here's why

1:16:13Atrioc:he's right so germany basically uh is a bloomberg article germany revives a building style again Again, prefab, I mean, you know, pretty similar history here. Germany also post-World War II dealing with tons of refugees. So particularly in East Germany, Soviet style, they just did, you know, massive amounts of these like identical homes that they would just make in this sort of single format. And so these are starting to come back in Germany and become more popular. And they're talking about how, look, this can be like six to nine months faster than a traditional home that's made on site. And the value of this is not only can we be a lot, lot faster with like, we just see they've built way fewer apartments.

1:16:49Atrioc:Not only can we be faster, not only can we be cheaper, but we're finding ways to address that concern of like, you're just getting the same thing as everybody else. And we have these customizable options. So what I thought would be cool, we can start prefabbing our conversations here on lemonade stand. If we plan them in advance, we don't have to actually like think through everything. We can just be right. So I'm going to ask a question, Aiden, I'm going to give you three prefab options. So even if you don't like the first answer. Okay. Wait, wait, wait. Even if you don't like the first answer.

1:17:17Atrioc:Right. Right. You can look to the second card. So just let me know. The audio listeners

1:17:20Aiden:Doug's passing out cards. Okay. So. Well, sorry. I'm not supposed to look at my second card yet.

1:17:24Atrioc:Yeah, just first one then you decide. So we don't have to think. All prefab. Hey, Aiden, what are long-term ramifications if Iran closes the Strait of Hormuz? And I have to, I just use this one? You have to pick one of the, the whole point is that we're not starting from scratch. Yeah, you don't have to think about this. Right.

1:17:47Aiden:the whole point of this no no no that's sorry it's just all of them are so good uh i don't care if oil prices go up i'm rich that was great you didn't have to do any thinking this was really efficient i didn't think about it doug is it are there more cards than this i don't know if i love

1:18:06Atrioc:no no no so the whole thing with the prefab right is i'm not giving you every option under the sun That would be traditional development. It would take too long. The point of this is the conversation is pre-made with some amount of customization. And you're going quick, and I like this. It's revealing a lot about you. Am I going to get asked another question? Here, I've got one for A-Trak. So, question. What do you think about former President Gerald Ford? Oh, I know what I think. Well, you have to read one of the prefab options. Oh, you gave me so many good options. I'd suck that man dry. That's the best option.

1:18:42That's the best one. That's the best one. Isn't this cool how you're customizing the conversation?

1:18:47Aiden:You hesitated. A bit homophobic of you, don't you think? No, I didn't hesitate. I just loved my options and I picked the best one. Yeah, I gotta be honest with you. I would have loved that option instead of... You know what?

1:19:04By the way, I don't think I can read this one. I don't think I can read this one. I won't even say that one.

1:19:09Aiden:If you want to diminish the Iran threat, show some guts and go through that straight.

1:19:13Atrioc:Yeah. All right. And then I got my own prefab card. So the rest of the episode, if you guys ask me a question, I will just pick from one of these prefab answers. Okay. Okay. Hold those because I have a, wait, are we? Yeah, go ahead. I have a topist topic. Okay. That I thought's really interesting. Can you pull up this video?

1:19:29BYD just, I want to hear Doug's take first. I'll tell you the top level topic. Like BYD just unveiled five minute charging stations and they've proven the technology that works and they're going to roll it out all over China and then in Europe, kind of dramatically changing the EV versus ice car debate. That will be fixed by AI. I don't see a change yet. This is the normal episode. Okay, ask me another question.

1:19:54Aiden:BYD is given ice cars? I don't like that. I don't know. Internal combustion engine, right? I was like, why is it called ice cars? Why is it called ice cars? Aiden, you're a liberal cuck. Get a real job. Doug's been kind of base on the podcast lately. I don't even have to think anymore. I can't even say my other one. I'll fucking say it. I'm currently wearing a butt plug shaped like Gerald Ford's face. That's one you wrote for me to say. You think that's one of my three prefab topics? I'm saying you can pick which of the whole value of this. Let me chime in there. no we're not if you guys want to watch it real quick it's actually kind of crazy tech and you know one of the things I hear people talk about with EVs as someone who currently doesn't own an EV one of the risks I have is like what if you don't have a charging station how long does it take it's a pain versus filling up gas quicker this is crazy crazy fast full charge and they can do like 70 % even faster than this so you can just get it and go and they're building these new battery stations and uh you know i do think this is one of the big holdouts for ev adoption and they're planning to build i think um 3 000 of these in china and then a few hundred in europe really soon to start kicking it off there so i do think um you know kind of scary for non-chinese especially non-byd ev companies it's like a really common like you I think this is something that might impact Tesla.

1:21:28It makes Tesla sort of less competitive because they've had this charging network advantage. And now that BYD is building out something that I think will be significantly faster based on the comparison that I saw, could cause disruption in the market. What do you think, folks? Aiden, you're a liberal cuck. You mentioned that. I do agree with that. That's actually a really good point. It does apply on here,

1:21:48Atrioc:and I do think Aiden should respond. I'm an expert on blank, and that's wrong.

1:21:55Aiden:fuck he's got me locked up he's got me locked up do you know much about the a friend who had lived in uh shanghai for a few years had told me this is the iq ones no i'm sorry the neo ones with the battery swap yeah yeah about that battery swap thing is that because in that context that seemed to remove a layer of the the charging downtime but is that something that is like not caught on and it's not super prevalent? Full disclosure, I lost money betting on Neo stock because of this idea back in 2021. And it didn't pull. I guess it's fine, but the idea is, you know, you don't know what it is. They drive up to a station, it takes a battery out, puts a new charge battery already, and you're out instantly.

1:22:38Okay. But I guess the process of it is more difficult, and it's harder to build these stations everywhere. And there ended up sometimes being a line anyway, where you're like waiting. So it wasn't as like, it wasn't this miracle that made people want to buy the car. Additionally, people just simply don't seem to think of that too much when they're buying the car. They want a good price quality car and they think of that stuff later, the charging stuff later.

1:23:01Atrioc:So I feel like at this point, I don't know. I don't own an electric vehicle. I would like to whenever I end up buying a new car. My understanding for the average person that this is not critical. But the instant you have this five minute thing, The last reason to go buy a gas car, I feel like, is gone, right? That's only, what, two minutes longer than stopping at a gas station? Yeah. In some cases, it's faster. I mean, again, you can get half charge or whatever super fast, and then it does the rest. Yeah, yeah. So anyway, I think it's a remarkable feat of engineering. I think it's pretty interesting.

1:23:33And I do think it is, yeah, breaking down the final barriers to making this.

1:23:37Atrioc:But then the question is, are we going to have this in America, or will we put a tariff on it to stop it from being here? We will not have it in America. We don't want the communist charging stations. We do it the old-fashioned way. That is the problem is while you're charging, you have to recite a passage from Xi Jinping Thought and Mao's Little Red Book. And if you don't do that, your car does not charge. And it was a stipulation they said was demanded.

1:23:59Aiden:I was just, I'll do it. For the Xiaomi SU-7, I'll do it. I don't know what to say.

1:24:05Atrioc:I'm excited. As a reminder, we are going to China soon. Very excited. Very soon, in a week or two. So we are going to be doing multiple episodes from China, trying to cover China, everything that we can see and talk about. And one of the things that obviously we'll be talking about is just the electric cars. I mean, suspicion is that it'll be everything and everywhere, right? And it'll be interesting to see what a city looks like with that everywhere, plus a crap ton of public transit.

1:24:30Aiden:I mean, we're supposed to be taking, using the high-speed rail network while we're there. I'm really excited to check out Chengdu and Chongqing specifically because I've heard those cities are like great examples of like modern Chinese cities. Like even Shanghai is like something that is a little, a little relatively outdated, relatively Westernized. Like I've heard Shanghai is amazing, but like if you want to see what a Chinese city looks like from the past 10 years specifically, we're going to check some of those places out. And I did want to attack one thing on. I saw an interesting piece about these cars In China and Europe, apparently, but I think China's enforcement comes into place by 2027 that all new vehicles must have physical dials for their functionality.

1:25:20Aiden:The iPads have to go away. Really? And I was so relieved to hear that because I'm hoping that's a decision that's made in more places. It's probably the thing I hate the most about the car that I currently have. I don't have an electric car, but I have like a - You don't like the dashboard? I think it's kind of cool. No, I hate - Because you have to touch the screen to like multiple times to get to things, right? Which means you have to look at the screen to navigate it. Oh, I see. But with old school dials, right? You just know where they are and you can like keep your eyes on the road. It's like way easier to navigate.

1:25:50Aiden:You don't have to go through multiple menus to access things and you aren't hung up by software in the same way. So China and Europe are apparently taking a step in this direction, like requiring cars to be built with physical dials again. and I was like, whew, that's, I feel like that's a good, I feel like that's a very consumer forward choice, because I actually think the iPads are a worse experience, but.

1:26:13Atrioc:Yeah, it's not quite, I mean, it reminds me when they removed buttons from the iPhone, you know, it's like, well, I would have preferred it, but you know, you get used to it eventually, but yeah, I, having some dials would be great, it's true. Yeah, I don't know, it's tough, I have to try one, I mean, I think the 2017.

1:26:27Aiden:You have an ancient car. The 2017 Honda Fit is the greatest car ever made, and it has dials, so I can see why you'd want to emulate that. I'm never going to change it. The car's falling apart. It's in the fucking parking lot now with pieces falling off. You need to buy a new car. Can I say it? I'll say it on the show. Take off the tariff and I'll get a Xiaomi as you said. You're trying to do the Sam Bankman Freed. I don't use my money type of thing. Just get a new fucking car. You could buy it. It could be used. I'm not doing the Sam Bankman Freed. You're doing the Sam Bankman Freed thing. I'm not doing the Sam Bankman Freed, bro.

1:26:57Aiden:And you're probably as good in league as he was. He was bronze. Oh, wait, I have one more China tech story that I think is interesting. You guys remember, we actually, you helped me with the video on it. You did a little thing. The Deep Seek flash crash in like middle of last year.

1:27:15Atrioc:Okay, video in quotes, but yes. Helps in quotes. You did a little, yeah, you just segmented in there. But the idea that it was the first big time that Western AI companies woke up to the fact that an open source model from China kind of distill what's called their weights. It could prompt ChadGBT or something questions and use that to train its model and catch up and have like an equal. Anyway, DeepSeek 4 was supposed to come out already around the recent Chinese economic conference. It hasn't come out yet, but it's going to come out soon. And I do believe we're going to see another big reaction because apparently this one is matching the latest models.

1:27:55So there's already a scare on that front. It's open source. But then the third thing is that it's, according to them, and we'll see if people are going to dig into it, trained entirely on Chinese chips. This is the first one with no NVIDIA chips involved in the process, which is going to cause a bit of a panic or a scare. I think this is coming pretty soon. We're going to see a lot of headlines about it.

1:28:16Aiden:Taiwan is a part of China, so NVIDIA would be Chinese chips. You already got your visa. I agree. Until I get my visa approved.

1:28:26Atrioc:It's wild. Dude, this stuff is, even for me, as like, you know, someone who wakes up, like, with Morning Wood thinking about AI, I have kind of gotten bored of the, like, did you see this new model? It's even better. I mean, this happens. I'm not sure it's going to be like, oh, this is the greatest new model. I think it's more the story of, like, how they made it, which is possibly distilling other weights, and then also no NVIDIA chips. It just basically says, how do you have a sustainable advantage if the hardware is an advantage and the software can be distilled? Where's the moat in AI models?

1:29:03I think that's the big question.

1:29:04Atrioc:Here's a counter argument. One, DeepSeek did not just copy other models. It is clear that a lot of the Chinese models that are being developed, like Kimi or DeepSeek, are using the American models to get a lot of the questions and answers to train on. Because with some of them, you can say, what is your name? And it will say, I am Claude. Yeah. And so that is true. But at the same time, I don't remember with enough technical details to give specifics. But DeepSeek did go and come up with these innovations. What was particularly interesting about DeepSeek is that because of the restrictions they had on chips, they managed to come up with these like crazy optimizations in order to make their model competitive.

1:29:42Atrioc:So while there was a sense of like, okay, DeepSeek has clearly been sort of cheating. You're not supposed to go. I have no care about who. I mean, again, you trace it up the chain and they, you know, like all these AI companies stole data. saying like the you know i it is oversimplified and some i've seen other people suggest this on the uh truth platform x.com which is that you know deep seek is really valuable and they were able to make it because they copied the other models and i think there's clearly more to that they've got some really smart people who did some crazy optimizations yeah they're leading in like the the video space with c dance and i'm not i'm not i'm not i'm not making this a competitive thing i'm just talking about from a market dynamics perspective it's like yeah pretty wild that an open source thing is about to come out that it's going to be close or matching yes so so the reason the reason i'm trying to establish that it's not just copying is because i think there's more differentiation than it might appear and i think a lot of people are just here's the benchmark with the newest model but you know the big hype thing for the past three months now has been clawed code this uh substack i think did a does a nice job of overviewing some of the features of clawed code if you pull it up it's called clawed code and what comes next And this talks about how there's more than just, they're not just scaling things bigger anymore, which I think was particularly susceptible to an open source model coming in and eating their lunch.

1:31:00Atrioc:They're starting to add some really smart ways that the AIs are coordinating sub-agents and doing all these different things, right? So he calls them magic tricks. But there's a, the AI companies are increasingly doing more than just increasing the amount of data. As that happens, I think they're going to be differentiated more and more. And I think it's less likely that you're going to see the same thing that happened a year or two ago where it's like, oh, new model just came out from Llama that's open source. I'm not saying you're wrong, but I'm saying we're getting to the point almost like Moore's Law where it's starting to get to a point where it's harder to fit more transistors on a chip.

1:31:35Atrioc:So companies had to start parallelizing, right, in order to get more out of chips. And I think that's seemingly starting to happen here of where the AI companies are starting to hit the value of what just giving even more data looks like. So they're having to really invent optimizations and clever things. And that's not easily copyable in the way that deep seek potentially did with Claude. Does that make sense? The point, the point is like, yes, I agree with you. Everything you're saying, it is going to be wild. If an open source model comes out and it could really hurt NVIDIA and it could really hurt all the AI companies in the West at the same time, they are starting to actually finally differentiate.

1:32:11Atrioc:In some ways, right? I think it'll be a big discussion point. At least it is very funny that companies like Claude and open AI are annoyed at DeepSeek for stealing their like responses and using the AI for training. Yeah, everyone in AI is stealing everything. It's kind of fun. Everyone's stealing everything. That story about Facebook or Meta, like having people like leave the company campus so they could set up a separate area to just download every book in existence so it wasn't like on Facebook property. Right. And they torrented, like they, like petabytes worth of book data and then fed it into the machine, but off campus.

1:32:49So it was different. Anyway. Yeah.

1:32:53Aiden:I think at the end of this episode, I want to kind of round it out and talk a little bit more about our trip, if that's all right. Okay. Sure. First of all, I want to say thank you because the reason we're going on this trip was we set it as a goal for our Patreon. When we got to 10 ,000 paid members on the Patreon, we promised to fund a trip to China where we go visit a bunch of cities, talk to normal Chinese people about what living there is like, what their experiences are like. Hopefully tour some universities and factories. We have some interesting things lined up while we're there. We're going to be recording and publishing two episodes of The Normal Show and two episodes of our Patreon show while we're there.

1:33:41Aiden:Do you think it's fine if I tell them where we're going or where our plan is right now? Yeah, sure.

1:33:47Atrioc:Why not? Maybe just not specific dates.

1:33:50Aiden:Yeah. Yeah, not orders. The plan is we're going to Shenzhen and Guangzhou and Chengdu, Chongqing, and Shanghai. and then we will be going to a couple smaller places along the way as well. So trying to, mostly focusing on some like big cities and opportunities that will be in each of those places. But I really hope it's a fruitful trip for us because we've talked a lot about China on the show, about like the amazing things that are supposedly there and I'm really excited to experience them. As someone who went to China, I've only been to mainland China once. I went a long time ago when I was a teenager and I've heard it's changed so much since then.

1:34:32Atrioc:Yeah, I mean, we've read three of the books we've done for book club are in some way, I mean, abundance kind of, but then House of Huawei and Breakneck are both about how China as a country is super organized around this massive amount of development and infrastructure and manufacturing and exports. and hopefully we can see that, right? I don't know.

1:34:53Aiden:For example, we're going to tour the factory where I produce most of the mogul and yard merchandise for like the past four years. Like we get to meet the factory owners and get introduced to the process of like how that clothing is actually manufactured in China. And there's a few more opportunities that are similar to that. I mean, I'll leak it here first. We are going to have an exclusive interview with Xi Jinping. I didn't want to say that. It's kind of, because it's like, you know what the big asterisk on that is. What's the asterisk? We got to do it with Tucker. It's Lemonade Stan, Tucker Carlson.

1:35:28Atrioc:I don't want the show to be biased. We have multiple perspectives. And it's a round table. And we're not going to talk about anything you think we're talking about. It's mostly going to be the boys chilling.

1:35:38Aiden:I think similar to our trip to Japan, we're also thinking about filming some of our walking around cities. We did a walk and talk episode while we were in Japan that a lot of people really liked and were planning on doing something similar. I think if you want to check out the Patreon for that extra stuff that gets posted, including the normal extra 60-minute episodes that we post every week, you can go to patreon.com slash lemonade stand and check that out. But the next time you see us, we will... Wait, no, we have one more normal episode. Excuse me, we have one more normal episode. I was wondering why you're dropping on this.

1:36:10Aiden:I forgot. I thought it was... In my head, we're leaving next week. But I forgot that we have one more normal episode.

1:36:15Atrioc:We're going to squeeze out an episode right before we go, and then you'll start seeing the China episodes.

1:36:19Aiden:Yeah. So, yeah, that's it. That's it from Lemonade Stand. Can you give a little, like, closing words in Mandarin? If you want to diminish the Iran threat, show some guts and go through that straight. Yes. Thanks for watching, guys. See you next week. And you're a liberal cuck. Go get a real job. Support for this show comes from Tasty Trade. Tasty Trade doesn't know that I have my hat on backwards right now, but they probably do know some things about trading. And I would go there if I want to learn a little more or maybe trade a few stocks. I don't know how to engage with this character. How can you guys don't take me seriously?

1:36:57Aiden:Because of the hat. The backwards hat. The backwards hat is fine. You can go to tastytrade.com slash lemonade today to get started to learn about trading. What is, who are you supposed to be? What is this character? Tyler.

1:37:13Atrioc:Oh, that explains it. Oh, that explains it. He's Tyler. Let's do that.