Mass Layoffs Hit Corporate America & Musk’s Grokipedia vs. Wikipedia

0:00What should you invest in? And how often? Making investing decisions is easier with Fidelity. With their step-by-step experience, you can find investments based on your goals and comfort level. And if you'd like, you can decide how much and how often to invest with recurring investments that happen automatically. Ready to make your next investing decision? Head to fidelity.com slash trading. Investing involves risk, including risk of loss. Fidelity Brokerage Services, LLC, member NYSE SIPC. Good morning for your Daily Show. I'm Neil Freiman. And I'm Toby Howell. Today, why Bill Gates thinks we're worrying too much about climate change.

0:39Then Amazon, UPS, PwC, oh my, corporations are slashing jobs left and right. It's Wednesday, October 29th. Let's ride.

0:53Last night, the Toronto Blue Jays tied up the World Series against the Dodgers in a game that was mercifully shorter than Tuesday night's 18-inning marathon, which lasted six hours and 39 minutes. But last night's breezy affair shouldn't be a surprise because country star Brad Paisley didn't sing the national anthem. Yes, if you want more baseball, Paisley is your guy. Here's one of the more bizarre things you will hear. There are only two World Series games ever that have gone to 18 innings. Brad Paisley sang the Star-Spangled Banner at both of them. He performed it back in 2018 when the Dodgers defeated the Red Sox in 18 innings.

1:30and he performed it Tuesday night when the Dodgers took until 3 a.m. Eastern to beat the Blue Jays. Something just seems to shift cosmically when Paisley sings By the Dawn's Early Light. No idea what's going on under that cowboy hat of his, but it's something wild. They've all been in L.A. too, which is really screwing East Coasters and their sleep schedules, but this goes even deeper than those two 18-inning marathons. Brad Paisley has sung the national anthem for the World Series Game 2 in 2017. that went 11 innings. World Series Game 3 in 2018 that went 18. World Series Game 1 in 2024 that went 10 innings.

2:06And then Game 3 in 2025, 18 innings. Every time he sings, you get extra innings. I would like to be called Mr. More Baseball, he told Variety when asked about it. If you like baseball, I'm your guy. Not a bad rap to have, honestly. And now a word from our sponsor, Disney Campaign Manager. Clarity, control, and convenience. do you know who needs these three C's the most? Our hair and makeup team. Yes, but also marketers. They need decision-making power at their fingertips, which is what Disney Campaign Manager works to offer seamlessly. Disney Campaign Manager enables a single campaign to run seamlessly across Disney, Hulu, and ESPN digital platforms, reaching multi-generational and cross-demographic audiences in one buy.

2:51The platform also blends automation with real people that offer support when you need it. Yes, humans, not bots. Marketers can rely on end-to-end transparency, full control over creative, and freedom from the typical trade-offs between ease, scale, and sophistication. Many advertisers can leverage enhanced ad units, including interactive and shoppable CTV formats, to foster customer engagement directly within iconic brand-safe streaming environments like Hulu, ESPN, and Disney+. Learn more at DisneyCampaignManager.com. That's DisneyCampaignManager.com. Well, you're going to be seeing a lot more green open-to-work circles on LinkedIn these days because big companies are slashing their workforces left and right.

3:33Amazon kicked things off yesterday announcing it will lay off about 14 ,000 corporate employees, with reports saying the cost-cutting campaign will ultimately result in the largest corporate job cuts in Amazon's history, totaling around 30 ,000. Not to be outdone, UPS said on its earnings call that it had reduced its operational workforce by 34 ,000 positions to go along with management cuts of 14 ,000 for a grand total of 48 ,000 job cuts. And those two are just the tip of the iceberg. The headlines poured in one after another yesterday. Chegg is laying off 45 % of its workforce due to AI eating into its web traffic.

4:10Target is reportedly cutting 1 ,000 of its corporate roles this week. The Paramount Skydance merger is leading to similar reductions, and consulting giant PwC reduced its global headcount by 5 ,600 over the last year after previously promising to increase hiring by 100 ,000 people by mid-2026. Why all the layoffs? Some of the reasons companies cited are cutting costs, making workflows more nimble, or in Amazon's case, reducing bureaucracy. But some of the biggest cuts are likely tied to execs hoping to free up funds for future AI spending. Neil, is the sky falling? It seems like every business is taking corporate Ozempic and slimming down their workforces.

4:49Yeah, layoffs are always pretty spooky, but the recent announcements have been especially so because of the long-term context, which is that many CEOs are now saying that they don't intend to hire more people in the next few years. They think they can grow sales and their share price without increasing headcount, which is a 180 from how things have typically worked in corporate America. Goldman Sachs sent a memo to staffers this month saying that the company is going to constrain headcount growth through the end of the year. Walmart, which is the nation's largest private employer, said it's going to keep its headcount roughly flat over the next three years, even while trying to boost its sales.

5:27So CEOs are coming out one by one saying, I don't think we need as big of a workforce as we used to have. So with these layoffs, typically you think, OK, but they'll be hiring more in the future. This is a temporary setback to pave the way for future growth. But now you have CEOs coming out and saying, yeah, we're gonna lay off a lot of people now, and I don't think we're gonna hire many more back. Yeah, it's a positive signal. Usually layoffs were kind of tiptoed around because your company is not coming from a position of strength if you are laying people off. But yesterday, I mean, we were reading the headlines about UPS, and Bloomberg's headline was, UPS stuns Wall Street with layoff announcement, and their stock ended up increasing a lot on this because you want to see more efficiency now getting more out of workers in the age of AI that we are entering.

6:13Raytheon recently told investors that it grew sales without adding people. It's almost this gleeful tone that these companies are adopting when they're saying we need less people now to drive the same revenue as we did before. So definitely a tonal shift to go along with all these announcements as well. Yeah, there's a chart going around the internet that some are calling the scariest chart in the world. And it says that since October 2022, which is the month right before chat GPT was released, ushering in, you know, this AI revolution, total job postings in the economy have declined by about one third, while the S &P 500 has spiked by 75%.

6:53And you can read between the lines about why that is called the scariest chart in the world, because this has not happened in corporate American history. And if companies are seeing share price gains by cutting workforces, then where does that leave the labor market in the next few months, in the next few years? It's a scary prospect. I think we've scared people enough right now. So I'm going to give maybe some good news or maybe a caveat to some of these headlines that we've been seeing. And that is ADP, which shows private sector job growth, said that it actually may be rebounding modestly. they had a report that showed an average of 14 ,250 private sector jobs per week were added over the past four weeks.

7:31So, again, here we are saying that all these companies, left and right, we're seeing headlines of people getting laid off. But that's roughly 55 ,000 jobs added for the month coming from an actual data provider right now. Again, ADP doesn't have full insight into the entire job market that the Bureau of Labor Statistics jobs report does. but at least for private employers, it does look like maybe we should slow our roll here because jobs are still being added, at least according to their data. OpenAI has finally emerged from its non-profit chrysalis as a beautiful for-profit butterfly. The long-awaited corporate restructuring marks an end to the capped profit hybrid era that confused investors, regulators, and podcasters alike.

8:14Now it's unambiguously a for-profit entity under the name OpenAI Group PBA, still overseen by the OpenAI Foundation. Now, if that sounds a little confusing, I'm with you, but regulators are at least happy with Delaware AG Kathy Jennings saying, this was a long and intensive negotiation, but I am pleased that OpenAI committed to a governance structure. One party who is more than happy with the path OpenAI chose is one of its earliest backers, Microsoft. Microsoft relationship has been in limbo over the past year or so, but yesterday's announcement revealed it owns a massive 27%. of the$500 billion business.

8:51That's actually more than the 26 % stake held by the OpenAI Foundation. In fact, investors celebrated yesterday sending shares of Microsoft up around 4 % on the news. That was enough to push the company across the$4 trillion market cap threshold for the first time ever. One final win for Microsoft, it gets to keep 20 % revenue sharing agreement until artificial general intelligence is achieved by OpenAI and confirmed by an independent panel. So it's going to keep getting sugar until Sam Altman can invent God, essentially. Neil, no wonder Microsoft is a$4 trillion company. Analysts saw this as a win-win for both parties here.

9:30Let's start with Microsoft. It has a huge stake in the world's fastest growing company. It retains intellectual property rights for OpenAI's tech. And yes, it gets a cut of OpenAI's revenues until AGI has achieved that nebulous concept of artificial general intelligence. And no one has a good sense of one that will happen if ever. And then for OpenAI, this deal allows it to complete this transformation into a for-profit company, allowing it to raise even more money than it has already, which seems impossible, but I bet it's going to get done, and sets the stage for an eventual IPO, speaking of raising money.

10:02Plus, it's able to tap into Microsoft's vast computing infrastructure, but it isn't completely locked into using only Microsoft, so it has optionality. This relationship had become increasingly fraught over the past few years as OpenAI and Microsoft, which had been a buddy-buddy relationship, had developed into competitors with OpenAI releasing particular AI systems and chatbots while Microsoft doing the same. So they were butting heads increasingly. OpenAI even was thinking about going to antitrust regulators and getting them out of this investment deal. Now that's all water under the bridge.

10:37Everyone seems to be happy from this deal. And OpenAI is headed towards the public markets, it sure seems like. Yeah, it does seem like a win-win, but I would say the scales are probably tilted in Microsoft's favorite here just because the sheer equity stake that they have. $135 billion worth of equity in open AI right now. They get guaranteed access to its frontier models too, which is a big thing as well. And then just that revenue sharing agreement I don't think can be overstated because AGI, artificial general intelligence, is a nebulous concept. First of all, this is actually a big deal that they are trying to say that we are going to definitively pursue it and it will be verifiably basically fact-checked by an independent panel.

11:17AGI has kind of been a nebulous concept up until this point. So the fact that that's on the timeline and it is a drop-dead date for a revenue-sharing agreement, that really will either show us that Sam Allman is pretty dang confident they can get to AGI or they're basically screwed and are going to be giving 20 % of their revenue to Microsoft going forward. But yeah, kind of a clarifying agreement here because things were just so – I mean the corporate governance structure of OpenAI was one of the most confusing things ever. People are saying we need a Sorkin movie to break it all down because there's just so many layers of drama here.

11:53This hopefully starts to clarify things a little bit. Toby's word of the day, nebulous. I know. And that was not the only milestone that was reached on the stock market yesterday. Got to hand out a game ball to Apple, which hit the$4 trillion market cap milestone for the first time. There's a lot of hype around people buying the new iPhone 17 models. And then you have to talk about NVIDIA. NVIDIA is nearing a$5 trillion market cap. It's up 3 % this morning, so it looks like it could reach that milestone. Today, it held this conference in Washington, D.C., where it announced a partnership with literally every company on Earth.

12:29I mean, it was a dizzying amount of partnerships. So its stock got a huge boost yesterday. If you look at your portfolio and you have NVIDIA, then you are pretty happy this morning. I thought you were going to say a game ball to Apple. And then how many game balls are we giving to NVIDIA at this point? Because, I mean, it was just months ago that it crossed$4 trillion. These numbers mean nothing anymore. I mean,$4 trillion is an unfathomable market cap. And NVIDIA is already encroaching on$5 trillion. So, yes, pretty insane that these companies now were encroaching on the entire GDP of America levels if you start to add together all these magnificent seven firms, which is just a wild sentence to utter.

13:08All right. There's a new way to look up where the Jonas Brothers went to high school. On Monday, Elon Musk launched a rival to Wikipedia he calls Grokipedia. The site, named after X's AI chatbot Grok, is intended to dislodge Wikipedia as your go-to information source at a time conservatives increasingly accuse Wikipedia of veering too far to the left. Your history teacher wouldn't let you use Wikipedia as a source for your essay, and they probably wouldn't let you use Grokipedia either. Grokipedia, while resembling Wikipedia in terms of article format, is different in a very important way. it's completely generated by AI.

13:43That's, of course, by design for Musk, who announced the project last week to combat what he considers left-wing bias by Wikipedia's human editors. And he's far from the only right-wing voice needling Wikipedia. David Sachs, the White House's AI czar, has blasted the site for allegedly censoring conservative content, while Wikipedia's own co-founder, Larry Sanger, wrote that it's been, quote, captured by anonymous editors who manipulate articles to fit their ideological biases. So a lot of pressure is building on Wikipedia, the ninth most visited site on the internet. It's not only facing political challenges from Musk & Co., but also a technological one from AI chatbots, which appear to be depriving it of website traffic.

14:23And worst of all, I didn't give it$3 the last time they asked. They do ask a lot. Diving into what's inside Grokipedia and how it differs from Wikipedia, just go no further than the entry on Elon Musk. It describes him on Grokipedia as an innovative visionary and a reverent provocateur. A lot of people said that it sounded like a PR team was writing this rather than actually AI chatbots. Go to the entry on Parag Argoel, which was Twitter's former CEO that Elon had a testy relationship with. And he said on Grokipedia, makes the acquisition that Argoel misled the public about bots. So it seems to influence a little bit of, introduce a little bit of editorializing into it, which is exactly the thing that Grokipedia is saying that it's trying to fight against when it comes to Wikipedia.

15:09And then the final ironic thing about this too, is that sometimes the entries on Grokipedia that seem to be entire carbon copies of the Wikipedia entries. You go to the PlayStation 5 entry, it is word for word, the exact same thing as what you see on Wikipedia. So it's trying to say that we're going away from Wikipedia yet. It's often using that as its source material of what it's citing. Yeah. And Musk continues to dive into the political sphere, which could be bad for his other businesses. Just look at Tesla. There was a study out yesterday by Yale University economist writing in the National Bureau of Economic Research.

15:44And they found since Elon Musk bought Twitter and turned it into X in 2022, Tesla's sales would have been between 67 and 83 percent higher, equivalent to about one million vehicles. Had he not done that, they call this the Musk partisan effect. So Tesla shareholders are looking at Elon Musk's continued foray into partisan politics and saying, we are missing out on literally 1 million vehicles over three years because you're doing this. They can't be happy. And yet they still are dangling a$1 trillion pay package ahead of him that is expected to be voted upon next week. Ryan McGrady, a researcher at UMass Amherst, said, controlling what gets written is a way to gain or keep power.

16:25The impulse to control knowledge is as old as knowledge itself. So So Elon is obviously trying to expand the scope of his information and media empire here, maybe at the expense of some of his other businesses. Go Minute Man. All right, we're going to take a quick break and come back with a Bill Gates story right after this. Neil, are you hitting your protein goals? Check out these guns. Do they not answer your question? They do not. So maybe try David Protein Bars. Nothing hits better after a gym ses than their red velvet flavor. Seriously, how can a bar taste that good and have such good macros at the same time?

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18:20That's Vanguard.com slash audio. All investing is subject to risk. Vanguard Marketing Corporation Distributor. Bill Gates celebrated his 70th birthday yesterday by telling everyone to stop going all chicken little over climate change. In a 14-page memo Gates acknowledged will generate a lot of debate, the Microsoft co-founder warned against a, quote, doomsday outlook around climate change, saying it will not lead to the end of human civilization. Instead, he argued, we should be investing more resources into alleviating human suffering right here and now, especially in poor countries where disease and inequality are still rampant.

18:57Gates wrote, this is a chance to refocus on the metric that should count even more than emissions and temperature change, improving lives. The chance he's talking about is next month's UN Climate Summit in Brazil, COP30, which sets the standard for the world's climate policy each year. Gates wants to influence the delegates heading there to change their priorities in the climate fight. Don't worry as much about every small increase and temperature and divert more resources to lowering poverty and preventing disease. Toby, let's be clear. This isn't Gates saying climate change is a hoax. He still thinks it's a major problem.

19:28But it's also clear from this memo that he's fed up with the end is near folks because they're sucking up money and attention he thinks would be spent better elsewhere. For example, Gates said, I'll let the temperature go up 0.1 degree to get rid of malaria. People don't understand the suffering that exists today. Yeah, he's kind of shifting his view from plowing billions of dollars into planetary-scale transformation into something more human-scale. I do think there's a direct through line here to the cuts to USAID that happened this year. He says that he wants to focus more on the immediate human suffering that is happening on the world right now while toning down some of the rhetoric around climate change.

20:07The general idea behind the psychology here is that it supports Gates' adoption of a more milder tone because apocalyptic messaging tends to push people back. Like they don't respond to fear very well. They respond much better to optimism. And so maybe it is a calculated thing that he's doing here. It's like obviously this rhetoric hasn't necessarily worked over the last few years, this alarmist rhetoric. Let's adopt a different tone and see if it affects people's psychologies a little differently. Yeah, there's a lot of reactions to this. So David Callahan, who's the editor of Inside Philanthropy, said exactly what you were saying.

20:43He said Gates's shift is in line with studies that alarmist messaging isn't working, that there's a ton of research out there that shows that in terms of messaging things like climate change, it's much better to lean into optimism than pessimism. But then there were also some criticism of Gates. Jeffrey Sachs, who is at Columbia University, he called the memo pointless, vague, unhelpful and confusing. There is no reason to pit poverty reduction versus climate transformation. Both are utterly feasible and readily so. And he's joined by a course of others who said, why not? Why not both? Why, you know, temperatures are increasing and that's leading to vast destruction right here.

21:20And now we had 62000 people die of heat because of major heat waves that across Europe in the past summer, their whole islands being washed away. They said we can we can focus on the temperature increasing and the complications that arise from that, as well as immediate poverty reduction. Gates is shooting back. Well, we only have a finite amount of resources and a lot of resources are going to climate projects. that really aren't very effective right now. And at the same time, there are a lot of resources being diverted away from human development in developing countries. So that's why he thinks it was necessary to write this really long memo that stirred a ton of conversation.

21:56Not only is it a psychological shift in messaging as well, but maybe it is reacting to the political headwinds right now, saying that, hey, in an era where ESG and people are maybe a little hostile to emissions frameworks, let's tone down this rhetoric So we see if we can sidestep some of this crossfire that is happening in the political arena and get things done more effectively on the human scale arena. So I do think you can't overlook the political aspect of this as well in an era where maybe people would be more hostile to his ideals. All right, let's sprint to the finish with some final headlines.

22:29Hurricane Melissa barreled into Jamaica yesterday as a ferocious storm for the record books. The Category 5, striking Jamaica with sustained winds of 185 miles per hour, was the strongest ever to hit the island and one of the strongest Atlantic hurricanes in recorded history. This thing was a brute. As morning breaks, Jamaica is assessing the damage. So far, no fatalities from the hurricane have been reported, but hundreds of thousands remain without power, and Prime Minister Andrew Holness said his country has been, quote, ravaged by Melissa. The storm, now a Category 3, made landfall on Cuba overnight and is expected to reach the Bahamas by evening.

23:06Yeah, meteorologists are looking at Melissa with its special interest because it is the fourth of the five Atlantic hurricanes this season to undergo, quote, rapid intensification, which is when you see wind increases of 35 miles per hour or more in 24 hours. And researchers are kind of shocked by this. It's extremely rare to have a storm rapidly intensify when it's already intense. A researcher at University of Miami told Wired, you usually see rapid intensification happen when it's a tropical storm or a category one or two, but not when it's already at the upper end of intensity. So these are bad storms getting worse very quickly.

23:42Scientists note that the warmer waters in the Caribbean probably fueled this phenomenon. 1440 said that the waters were two and a half degrees Fahrenheit, warmer than average for this time of year. And again, I can't help but see the symbolism between the story we just talked about with Bill Gates with Melissa happening. Maybe the timing is almost like poetic, the fact that he dropped this manifesto while we have this massive storm intensifying. Up next, hold on to your cowboy hats because Taylor Sheridan, the architect of Yellowstone's sprawling TV empire, is heading on over to New Frontiers.

24:15The prolific showrunner responsible for hits like Tulsa King, Landman, and Kevin Costner in those jeans is set to leave Paramount and join NBCUniversal when his current deal expires at the end of 2028. For NBC and Peacock, it's a blockbuster creative get because this dude just cranks out hits. For Paramount, it's a gut punch that will be tough to stomach for new owner David Ellison, who Sheridan clashed with, partially leading to his exit. Neil Sheridan's sprawling TV universe has carried Paramount Plus for years now. Now NBCUniversal is betting he can bring that same Western magic over to their side of the fence.