Trump's Crypto Windfall, Dems' Anti-Establishment Wave, and the Supreme Court’s Big Week

4:35Scott Galloway:All right. You see the problem here, right, Tara? I see the problem. You see the sense of urgency.

4:39Kara Swisher:I see the sense of urgency. Do you know Jamie Dimon?

4:41Scott Galloway:Maybe ask Jamie to lean on Michael to accept my apology.

4:44Kara Swisher:I'll talk to him. I bet he likes a good dirty joke. He seems like a fella who likes a dirty suit. I could see him guffawing to that. He has a good guffaw. Anyway, where are you right now? What are you doing for the 4th of July? Are you doing anything? I'm going to a tractor parade.

4:59Scott Galloway:You too? Yeah. Well, wait. No, I'm going on a big fat boat around Sardinia. So same, same. Okay. I got the holidays. Yeah. Find some DJ on Buena Faccia or whatever it's called. Corsica. And probably do X. Yeah, same thing. Yeah, same thing.

5:17Kara Swisher:Yeah, I go to this annual tractor parade in Vermont where Amanda's family rebuilt a barn that was falling down that they had this sort of funky hippie barn and they redid the whole thing and it's beautiful, I have to say.

5:29Scott Galloway:Does that mean you guys have an open relationship and you're both looking for lesbians? No, not at all. No?

5:35Kara Swisher:No, that time has passed for Kara Swisher, I have to say. Yeah.

5:39Scott Galloway:You haven't hit your midlife crisis yet.

5:41Kara Swisher:I had it.

5:42Scott Galloway:Oh, I saw you on one of my favorite guys' podcasts. I love Dan Harris. That's all you've done.

5:47Kara Swisher:That was good, yeah. He's still comforting, isn't he? Yeah, yes, 100%, yeah.

5:52Scott Galloway:He has, whenever I, let's bring this back to me, whenever I'm mentoring young men, he has one of my favorite pieces of advice that I always give to people.

6:00Kara Swisher:Which is?

6:01Scott Galloway:Action absorbs anxiety. Oh, that's good.

6:03Kara Swisher:I love that. Yeah, you have a lot of those things.

6:05Scott Galloway:You're upset about something, you're anxious about something. Do something. Immediately start moving against it and addressing it and you start to feel better.

6:10Kara Swisher:Or anything, do something else. Yeah, I think that's a really, really good.

6:13Scott Galloway:I like to adopt him as a big brother. Is he looking for a little brother? That guy is so comforting and smart and wise.

6:18Kara Swisher:You're going to be gone next week. We have special guest stars.

6:21Scott Galloway:Oh, who? Do you know who the guest hosts are?

6:22Kara Swisher:I think Scaramucci is one.

6:24Scott Galloway:The Mooch.

6:25Kara Swisher:Mooch is one.

6:26Scott Galloway:I don't like it when the Mooch comes on because the downloads go up.

6:28Kara Swisher:And we also have Puck's Matt Bellany.

6:30Scott Galloway:Matt Bellany from The Town.

6:32Kara Swisher:The Town, yeah. Yeah, yeah, yeah. I like him a lot. I think there's a lot of, you know, media stuff. And actually, I have to say, he and Eric Gardner have been doing the best coverage of sort of media murders and things like that. Just smart. I just, you know, they did a great take on the Comcast thing. I just, I want to talk. He's always smart. He's also snarky in a way I like, but does great reporting. That's my, he's accurate as a reporter. So I like that in him. So yeah, and then of course, Scott for Yagas, I've got a real lineup to try to replace you and figure out my next act, essentially.

7:03Kara Swisher:We got it.

7:04Scott Galloway:At some point, we should have a recommitment ceremony.

7:06Kara Swisher:We should. We should. That was us on the top of the Empire State Building.

7:10Scott Galloway:Oh, God. So I've got a lot to say about both those things. Okay, hold on.

7:14Kara Swisher:All right, go ahead.

7:15Scott Galloway:Those two, it is so obvious. Those people are narcissists who like each other but don't love each other. First off, if you do that for attention, you're really into look at me.

7:24Kara Swisher:Yeah, sure.

7:24Scott Galloway:And if you're engaged to someone and willing to let them climb up the Empire State Building, it means you like them but you don't love them.

7:31Kara Swisher:Oh, really?

7:31Scott Galloway:It's like if they fall, it wouldn't be a tragedy, right? I don't know.

7:34Kara Swisher:Some people chase that kind of stuff, don't you think?

7:37Scott Galloway:Yeah, but people can chase that stuff and not risk their spouse's life. Would you let your wife do that, regardless of how competent a climber?

7:45Kara Swisher:I have friends who are in those relationships. They love to do, like, extreme sports. I have a lot of—I'm not a friend that do that, but I know a lot of people who do that, and they're very into that kind of thing. So, you know, they like all that, like, you know, surfing, like windsurfing, like, very dangerous places.

8:03Scott Galloway:Have you ever been to a recommitment ceremony? No, no. Oh, God, I've been invited to two. And you know what they mean? What?

8:09Kara Swisher:No, what do they mean?

8:10Scott Galloway:It is so obvious. They might as well put on the invitation when they invite you to a recommitment ceremony that he was fucking his secretary and got caught and doesn't want to lose his kids. So they have a recommitment ceremony. And the second thing it means is they're going to be divorced within three years.

8:22Kara Swisher:Oh, okay. I've never been invited.

8:25Scott Galloway:I'm in such a good mood today. I know. Aren't I a bucket of sunshine today? I know.

8:29Kara Swisher:So if we have one, we should have a ceremony. We should climb something. I was thinking about us when that climb was happening. I loved it. This is what, I love New York right now.

8:38Scott Galloway:We look like Gandalf and Billy Barty ascending Mount McKinley.

8:41Kara Swisher:I love, I love everything about New York right now. These people climb the Empire of Fonkin State, and then they put up that, you would have liked their message about love and power and stuff.

8:50Scott Galloway:That was nice. I did like their message. Yeah, their message.

8:52Kara Swisher:I just love, and then that picture of them looking hot as hot in the elevator.

8:56Scott Galloway:Yeah, they're narcissists.

8:58Kara Swisher:I love them. Look at me.

8:59Scott Galloway:I know. Look at me.

9:00Kara Swisher:Oh, you would know nothing about that topic.

9:03Scott Galloway:And I have an easier time recognizing other narcissists. I understand.

9:06Kara Swisher:The other part is, okay, first you have the Empire State Building, of course the Knicks and everything else, and the World Cup going.

9:12Scott Galloway:I can spot someone who does edibles from across the bar. I'm like, dude, you do edibles, don't you?

9:15Kara Swisher:I wouldn't do that if I was climbing that fucker. I was trying to see if they were -

9:18Scott Galloway:Oh, no, no, you don't need to be high climbing at the Empire State Building.

9:21Kara Swisher:Okay, all right. Anyway, and then like a mom donning jumping in the pool. I love that. And then Taylor Swift getting married. I love New York so much today for all the shit it's pulling.

9:32Scott Galloway:Oh, God, here we go.

9:32Kara Swisher:I'm just telling you. Here we go. Are you going to the wedding? I wasn't invited.

9:35Scott Galloway:No, but I heard all her ex-boyfriends are showing up and doing a harmony of maybe it's you.

9:41Kara Swisher:I love that she's going over the fucking top. I love someone. I like anyone who goes over the top. I love the Empire State Building people. I like Mom Donnie jumping, Mom Donnie jumping.

9:52Scott Galloway:That was brilliant. Him going to the pool was great.

9:55Kara Swisher:I like it all.

9:56Scott Galloway:Bloomberg did the same thing, but no one criticized Bloomberg. He's not.

9:59Kara Swisher:He's good looking. Well, that's the way he is.

10:00Scott Galloway:No, I agree.

10:01Kara Swisher:Yeah. I don't know. I just love the whole thing. I'm so excited. He was doing water aerobics.

10:06Scott Galloway:Yeah.

10:07Kara Swisher:This is why Matt had Bellany on, because he wrote, he goes, do you think she's filming it for a Disney special? Really? Really? Of course she is. Like, just watch. I love the whole thing. If you're going to get married, make it a thing. We should have a ceremony. Let's do that on our tour, on our pivot tour.

10:26Scott Galloway:Are we going to get married?

10:27Kara Swisher:Yeah. No, we should do a ceremony of some sort. By the way, we just planned our new pivot tour for November. We did.

10:33Scott Galloway:We have a new city.

10:34Kara Swisher:We're not going to say. Should we say it?

10:36Scott Galloway:No, it's not right.

10:37Kara Swisher:You can say it. Go ahead. Say it.

10:39Scott Galloway:We're coming to the great city of Denver.

10:41Kara Swisher:Denver.

10:41Scott Galloway:Yeah. I'm excited about Colorado.

10:43Kara Swisher:And another one that we didn't go to. We've been to recently, but Minneapolis. We're going to Minneapolis. Oh, yeah.

10:47Scott Galloway:We're going back to Minneapolis to show Civic Pride.

10:50Kara Swisher:Yeah. That was for the resistant unsubscribe, but now we're going for big. So, those are the two new cities, Denver and Minneapolis, and we're going to some ones we already went to. Anyway, we're very excited, and we're going to have ceremonies everywhere. We should get to the news, actually. There's a big piece. Why not? Yeah. First, let me just tell you, Donald Trump's embrace of crypto is paving off in a big way. Trump earned about$1.4 billion over the past year from crypto, according to a new financial disclosure, which I think is undercounting all the grift he's doing. A big chunk of that came from sales of his Trump meme coin and digital tokens for the Trump family crypto company, which he gets paid no matter what.

11:24Kara Swisher:And everyone who's invested in it is losing. Just so you know, he got all this money. It's not just crypto. Trump pulled in at least$2.2 billion in total income for the year, up from$622 million in 2024 before he returned to the presidency. That includes more than$620 million in real estate, hotel, and golf for their income, which is almost nothing, plus$86.5 million from legal settlements from ABC, CBS, YouTube, Meta, and X. This grift is just, and it turns out we're paying for the East Wing, we're paying for the Kennedy Center, we're paying for all manner of things that he is up to, which he said the public wasn't paying for.

12:03Kara Swisher:So, this is astonishing. I think they're undercounted. I mean, nobody's surprised, but the grift is really quite astonishing, I thought was, wow, that's a lot of money. Your thoughts?

12:16Scott Galloway:Well, there's the grift and there's the micro, and that is$2.2 billion in personal income while sitting as you're occupying the Oval Office and$1.4 billion of it from crypto, a financial system that he now supposedly regulates. It's not a conflict of interest. It's a business model. And essentially what you have in America is slowly but surely we're monetizing everything. We monetize health care. We monetize education. we monetize enragement online, and now the president is monetizing the full faith and credit and power of the White House. And he went from$622 million the year in net worth before taking office at$2.2 billion after.

13:01Scott Galloway:He's essentially set up a toll booth for the American government. And the meme coin would have been a five-alarm scandal for anyone else but him. Absolutely. Absolutely. It's a financial instrument with no underlying value that goes up when the president tweets about it. And that's securities manipulation with a big red hat. And the fact that he did it the Friday night before his inauguration under the cover of dark, you know that he called people and said, thanks for giving me 10, 20, 100 million dollars for my campaign. FYI, the coin gets announced tonight. It'll go up. And then you can, if you dump it, you dump it.

13:35Scott Galloway:But on a larger level, I was thinking about our 250-year anniversary. And I mean, this is the reality that since 1991, childhood poverty has gone way down. Crime has been cut in half. The number of people have gotten educations has gone up. We have a healthier, better educated populace than ever before. The crime is at its lowest rate ever in New York, right? But happiness, as Jimmy Carr says, or satisfaction, isn't a function of what you have. It's the delta between what you have and your expectations. And what's happened in America, because there is now a normalization, an algorithmically normalized 0.1 % in terms of your expectations.

14:25Scott Galloway:I'll give you an example. From 22 to 42, I did nothing but work. And I think my first vacation, the only vacations I took with my mom, we went to Niagara Falls once. We used to go to Magic Mountain because we couldn't afford to go to Disneyland. And I remember going to Club Med in Mazatlan when I was like in my late 20s. I thought it was fucking, I mean, it couldn't have been any tackier. Bad daiquiris, not a very nice beach, all you can eat but that you wouldn't want to eat all of it. And I thought it was amazing. I just thought it was the most, I was, I brought back Club Med shirts. I had a Club Med hat.

14:59Scott Galloway:I just thought Club Med was the most amazing thing. And I was talking about going to different - Did you pay by beads?

15:05Kara Swisher:Didn't you have beads?

15:06Scott Galloway:Yeah, you get beads for bars, for drinks. It's amazing. Oh, wow. And because here's the thing, I had never been to, nor was I being reminded 105 times a day as people vomited their experience at St. Barts and Mykonos. My expectations were dramatically lower. And then you combine that with the following. The people who are supposedly in charge are exhibiting a level of corruption and depravity that just makes us feel bad about institutions.

15:37Kara Swisher:Right, exactly.

15:38Scott Galloway:So you have a coarsening of our discourse where, quite frankly, there's an economic incentive to shitpost everything. It's happened a lot during the Biden presidency. It's also, to a certain extent, happening now. You have social media vomiting everybody's wealth in your face and giving you the impression that if you haven't made$3 million on Ethereum and your boyfriend doesn't have a six-pack, you're failing. and also the people in charge seem to be genuinely like low character people. Right.

16:03Kara Swisher:Grabbing everything. All the good things. Yeah.

16:06Scott Galloway:And people don't trust the CDC. They don't trust the Supreme Court. It's like what William Gibson said, the future is here. It's just not evenly distributed. Prosperity is here. They see it everywhere. But people don't feel like it's evenly distributed. So people, now a quarter of a people under the age of 25 feel good about America. It's Definitely, like, Kyla Scanlon coined the term vibe session, but the 250th anniversary, if you, if the, well, you're down there. What's the vibe like?

16:34Kara Swisher:Well, you know, I think people feel like this, this guy grabs everything. Like, my worry is that it goes, we all hate everything because of these people, right? We think everything's on the take. And it sort of makes you feel like nothing works or, or that there's no payoff or anything. And, you know, I was really struck by a really interesting exchange this week between, you know, Elon Musk attacked Ro Khanna for saying he's killed children with the cuts of USAID that he bragged about, you know, putting it to wood chipper, et cetera, without any care for the impact. And then he said, show me one person who's been killed.

17:11Kara Swisher:And then Nick Kristof, who does amazing reporting from the New York Times. Name names. Here's some names. There's some names. And by the way, there's.

17:16Scott Galloway:And I saw them.

17:17Kara Swisher:Thousands and thousands and thousands and thousands more. And then instead of like actually engaging him, which he did exactly what Elon asked for, because that's his thing is like name one person who's hurt. That's their little stupid trick. And he does. And then he's like, Nick Christoph is evil. I was like, you fuck. It made me think. It sounds really, including this crypto stuff, is like, what's wrong? I wanted to fight the feeling of everything sucks. And it was really hard for the first time. I was like, these people have no care. The same thing with Stephen Miller spouting off about the, they won all these Supreme Court cases, but they lost the one that they really care about, which was birthright citizenship, right?

18:00Kara Swisher:And so they just can't stop the hate. They just have endless pools of hatred and grift. And I wonder how you survive that, and especially if you're a young person looking at it. Like, what is your reaction? I mean, that to me was like, I even feel exhausted by their enthusiastic villaining and stealing. Like, I find them exhausting. And I just don't know what I would do if I was a young person looking at all this, you know?

18:28Scott Galloway:Yeah, it's, look, there's a lot of issues. I mean, the number of people in the middle has gone away. And young people have a rational reason to be upset. The traditional means of building a life, finding a mate, developing economic security, advancing up the ladder, which is typically some sort of certification, either vocational programming or a college degree, and then buying a house. The incumbents have weaponized scarcity to make it more expensive for them to get those things such that the people already own them, a college degree in housing, can see the value of those things go up. and also our tax policy, which continues to transfer wealth from them to the incumbents, right?

19:13Scott Galloway:Loosely speaking, our tax policy over the last 50 years has taken$50 trillion and transferred it from the bottom 90 % to the top 10%.

19:19Kara Swisher:Rich old people, yeah.

19:21Scott Galloway:Yeah. So they justifiably can be very upset. Having said that, if you actually look at the data, things aren't as bad as you would believe in terms of the vibe. But again, and this is the great Jimmy Carr, your happiness and your purpose isn't a function of what you have. It's the delta between what you have and your expectations. And the downside of a meritocracy, and especially when social media speedballs it, is everyone believes if they're not in the top 1%, they're failing.

19:55Kara Swisher:Except when they're looking at the president just stealing, stealing and stealing. Agreed. 100%. That's really it. Like, there's just no even like, look, grift has been around. Not fair. The game is rigged. Grift has been around forever from the beginning, right? From every country, every historical thing. But this is grift on a very explicit scale and also, like, yeah, that's right. I'm taking it. That's right. I'm cheating. And let me tell you, let me put on another story that came out. Politico is calling this week's Democratic primaries in Colorado an anti-establishment avalanche. Obviously, it was happening in New York, which is no surprise with Momdani backing a bunch of people, one of whom is really problematic.

20:33Kara Swisher:Colorado Attorney General Phil Weiser, though, upset longtime Senator Michael Bennett, who you and I both have a lot of regard for, who looked like a lock for the nomination a year ago. We thought he'd be governor of Colorado. And then 29-year-old Democratic Socialist Maylott Kiros unseated a 15-term congresswoman. And Manny Rootnell, a progressive state representative, defeated a moderate Democrat. The results add up to a growing string of progressive anti-incumbent. I think that's actually Steve Bannon was very canny on this stuff. Victories, notably what happened in New York. And there are a number of primaries still to come over the next few months.

21:08Kara Swisher:All this is a New York Times-Siena poll show Democrats within striking distance of putting the Senate majority back in play. I want you to not go negative yet because I want you to understand. Talk about these victories and what they are. And let me read something that Robert Reich wrote on Substack about these elections. Pundits eager to declare a new movement or sound the alarm about socialism are having a field day, but they're wrong. Voters who have supported these candidates haven't done so because they've been particularly attracted to the idea of democratic socialism. Most even don't know what democratic socialism is.

21:39Kara Swisher:In reality, voters have been attracted to vigorous young people who are committed to getting stuff done. Steve Bannon said nearly the same thing, which was really interesting. And I would agree talking to, like, Louis. He's just sick of people not getting stuff done and looking for something else, which is interesting. What are your thoughts on this? I think Reich and, I hate to say it, Bannon are correct.

22:01Scott Galloway:I think that's exactly right. The establishment didn't lose on policy here, Kara. They lost on energy. And look, I've been calling for disruption in the Democratic Party. I think Leader Jeffries and Minority Leader Schumer are absolutely the wrong people to provide the kind of robust, energetic pushback that the Trump administration, warrants. But here's the thing about disruption is you don't get to pick the exact calibration of your disruption. So for example, I consider myself a moderate and I'm convinced that the true litmus test of someone who's truly a moderate is everybody hates you, but you don't get to...

22:36Scott Galloway:So think about the senators who are moderates, like Fetterman and Manchin. Everybody hates them. So people claim they want a moderate, but when someone actually shows up and occasionally agrees with the other side, they become an apostate. At the same time, guys like me claim we want disruption. We need to disrupt the Democratic Party. And then when it happens, we freak out about it. But here's the bottom line. There's a lot to like here. And I say this full disclosure. I have given money to Senator Michael Bennett for everything he has run for for the last 10 years. I hosted a fundraiser for him for president.

23:13Scott Galloway:You know, By the way, if you get money from me, it's not a good sign. But I think the world of Senator Bennett, former school superintendent, one of the most credentialed people in the Senate, lost to a state AG nobody had ever heard of a year ago. But here's the bottom line. If you want disruption, you don't get to pick your form of disruption. And these candidates, there's a lot to like about these candidates. They're young. They're energetic. They're unafraid. They don't have a bunch of blather about how you would go about universal health care. They're just like Medicare for all. So there's a lot to like about them.

23:52Scott Galloway:But the reality is, for those of us in the center, we don't get to pick our flavor of disruption. What I would say that bothers me is that democratic socialists effectively want socialism through democratic means. The reality is, if you really look at history, socialism just doesn't work, folks. and they will always point to, well, what about Northern Europe? Northern Europe is actually more capitalist than we are right now. They just have a social safety net and they spend -

24:19Kara Swisher:They call themselves that though, don't they? I mean, you always threat about Sweden, for example, or the Netherlands or -

24:28Scott Galloway:Yeah, but here's the system that's worked. Democracy, individual rights, and capitalism. Call it what you want, but when you start, when you don't, And when you start believing that you should have government-sponsored grocery stores or that you shouldn't have border, I mean, that shit, quite frankly, it just not only doesn't make sense, it threatens our ability to win the midterms. Rahm Emanuel had a fantastic statement in the thread we were on, and he said it publicly. We have to stop arguing and atomizing ourselves between blue and cobalt blue. So I'm more focused on my energy on, you know, the grift and corruption and just stupid decision making of the Trump administration.

25:12Scott Galloway:The thing, so there's a lot I like about this disruption. You don't get to pick your flavor of disruption. And you know what? Young people just want change.

25:22Kara Swisher:They just want change. Interestingly, I was just on Scaramucci's podcast and he said he actually has been impressed by Momdani and he was very against him. He was sort of where you are, right? Yeah. kind of thing. And he's like, I have to say he's effective. And I do think they're not looking for necessarily just upsetting the incumbents. They want people who do shit. And one of the things about Wiser, and I was watching this thing is he was just a more energetic campaigner. He wanted your vote more. And he was, he wasn't necessarily much more liberal. It wasn't that because Michael's pretty liberal, relatively speaking, right?

25:59Kara Swisher:Especially in Colorado. He just looked like he He just was energetic and not just fake energy. It's not just fake energy. It's youth. Maybe like what Kennedy felt like back in the 60s. It was like, I literally just want you to do your job. Like I want, and I do think, I think you're right about capitalism. I agree with that. But it needs to have everyone gets health care. That is not, I think that's a really good message of the democratic socialists and everyone else. Everyone should get good health care. Everyone should get a good minimum wage. Everyone should get, you know, and what's incredible, I'll tell you, what really absolutely struck me, and I finally realized that the Republican Party is fucked in seven ways to Sunday.

26:42Kara Swisher:What's coming next, I mean, post-Trump, was Mamdani said, can everyone, like, we have an electrical grid problem probably coming up with this heat because there's a huge heat warning all over the East Coast, including in New York. And he said, if you could put, you know, your air conditioning to 78 versus 74, that would be great. That's all he said. Immediately, Ted Cruz and Nikki Haley, I told you she can't help herself, said communism, right? Or this is what socialism is. Immediately, their tweets from many years ago were when she was governor of South Carolina. And the same thing in Texas, where they asked people to put their air conditioning down, surfaced.

27:23Kara Swisher:What is wrong with them? Like he was asking a normal thing that they themselves had asked for. The minute they jumped on it, they were trying to do socialism. They look like idiots and everyone can see it. And that's why I told you Nikki Haley is impossible. She's never going to win anything because she's such a suck up in so many ways. It was so not sensible. He was saying something sensible and everyone sees it. And did not immediately think communism about the air conditioning, even though I love air conditioning. And so that to me is they're vigorous young people who want to be effective. That is what I think is attractive.

28:01Scott Galloway:I don't disagree with any of that. And the thing that Mondani and some of these people are doing, the most admirable thing about Donald Trump, President Trump, is action orientation. It's ready, fire, aim. It's like, no, I'm going to do this. We're doing it. And the courts might challenge it. We might have to roll it back. But Americans really respect that. And Mondani, to his credit, immediately imposed certain taxes, certain policies. And I think young people think, well, at least he's fucking doing something. Now, the glass half empty for me is the following. Whenever the far left and the far right agree on anything, it's a really bad idea.

28:40Scott Galloway:I believe they both, the far left and the far right, come together on what I believe are anti-Semitic themes. They both come together on an isolationist foreign policy. And what I see here is they both come together on socialism as an economic policy. Donald Trump is investing in intel. Donald Trump is entertaining the idea of investing in open AI. Donald Trump believes that the government should have a golden share in U.S. steel. All that happens when you do that, all that happens when you do that is you end up with warehouses in Ireland full of DeLoreans and Air France. And you see a lot of that rhetoric from the far left.

29:17Scott Galloway:We absolutely need a more progressive tax structure, but here's how you get to a progressive tax structure. The thing we spend the most money on is not the military. It's not our debt. It's not even Social Security. The thing the American government spends the most money on, we spent$2.2 trillion on givebacks from the tax code in the form of loopholes to corporations and the wealthy. We need to reduce spending on tax loopholes and givebacks to the wealthy and corporations. And if you look at Northern Europe, they're very capitalist. They let companies go out of business. They don't take stakes in Spotify.

29:59Scott Galloway:Their tax rates are either the same or a touch higher than ours. But what they do is they enforce them and they say, Spotify, you don't get to write off your jets, your plant, property and equipment. And the richest people don't get to have donor advised funds where they get to write off donations they haven't made yet. So but what I what I don't like about I mean, quite frankly, there's some things that really bothered me about the winds in New York because I felt like being anti-Israel with a litmus test. Obviously, as a Jew, that concerns me. Well, there was one.

30:31Kara Swisher:There was one. The Lander is not - Chevalier. Yeah, Chevalier is the problem. Yeah.

30:35Scott Galloway:By the way, she's going to be the poster child. She's about to become the poster child for Republicans in 26.

30:40Kara Swisher:She's problematic, no question.

30:41Scott Galloway:Anyways, but let me circle out to where I started. I don't get to pick the calibration and the color and the flavor of disruption. Disruption, they're youthful, they're energetic, They're unafraid. And that for me is 70 or 80 % good. Do I worry that they're embracing a form of socialism that has never worked throughout history? Yeah. I trust there'll be modulating forces from the center on both sides on that. But the reality is we need, the Democratic Party needs to shed its skin. Leader Jeffries and Schumer are getting clear signals. No one gives a fuck what you think. You have become, institutional endorsements have become a liability.

31:23Scott Galloway:Just as we thought U.S. bases in Gulf states would provide a veil of protection, they'd become bullseyes. You're going to start to see Democratic candidates say, Senator Schumer, please do not come to my rally.

31:35Kara Swisher:They are. They are actually. They're like all talking about whether they'd vote for him. He's got to go. I told him that to his face. He thought I was kidding. I was like, no, you need to step down. He's like, ha, ha, Kara. I was like, no, So time to go. Time to move along. I mean, we don't want to Mitch McConnell, the situation.

31:52Scott Galloway:These guys cling to power like an African dictator, which I'm sure is a hate crime.

31:55Kara Swisher:Yeah. I was like, we don't want a Mitch McConnell situation here. We want to move along. Anyway, I agree with you. It's very it's it's exciting. I find it exciting.

32:02Scott Galloway:We need a disruption.

32:04Kara Swisher:Yeah.

32:04Scott Galloway:Good for them. Youth energy have at it. I think it's a good thing, too.

32:07Kara Swisher:I like non-cautious people. I do. I think the Democrats have played it too cautious. Anyway, let's go on a quick break. When we come back, the Supreme Court finishes its term with some major rulings. That was something.

32:21Scott Galloway:Support for the show comes from Framer. If your team wants a website that looks and feels handcrafted, but is still fast to ship, Framer is built for that. You design on a visual canvas with responsive layouts, hosting, and a CMS built in, so the work is production-ready from day one. Agents work alongside you to draft pages and polish sections, then you review and publish what goes live. Framer is the pro site builder for creators, teams, and businesses that want a professional site and care enough to get every detail right. Agents solve the gap between AI-generated ideas and production-ready website work.

32:52Scott Galloway:The agent works in the same place where the real site is designed, managed, reviewed, and published. It lands on the canvas, stays editable, and can be published when the team is ready. Agents in Framer work alongside teams to streamline collaboration on the same canvas, build custom code components, create and manage CMS content, optimize SEO settings, and ship everything all in one place. Learn how you can get more out of your side from a Framer specialist or get started building for free today at framer.com slash pivot for 30 % off a Framer Pro annual plan. That's framer.com slash pivot for 30 % off.

33:24Scott Galloway:Framer.com slash pivot. Rules and restrictions may apply.

33:32Scott Galloway:Is Donald Trump still cool? Well, at first here's what he was promising to America. He was promising change. Yeah, promising a big change. Has he lived up to that? No. No, I wouldn't say so. I wouldn't say so. I'm disappointed. We're in Washington, D.C. for one of the events that Donald Trump is throwing for America's 250th anniversary, and it's UFC night. Proud to be American. We got free tickets. It's just going to be a great time. That's about it. It's an opportunity to talk to a group that was central in the 2024 election, young men. Why do we think Trump and men seem to have a connection?

34:05Scott Galloway:I feel like he just knows how to advertise himself to the younger proud. It aligns with masculinity, I feel like, to a certain extent. But if they don't like Donald Trump, what do they prefer politically otherwise? I care about my family. I care about my country. I want people to be safe and happy where they live. I care about my wallet too, man. I'm Estet Herndon, and this is America Actually. Catch us every Saturday on YouTube or wherever you get your podcasts. No one could blame you if you thought this Men's World Cup was going to be a disaster. The president of the United States isn't exactly a welcome mat for the world, and there have been plenty of embarrassing stories for the country.

34:41Scott Galloway:There was the mom of Kate Bird's goalkeeper who wasn't let into the United States to watch her son play until the team started doing well and people clamored for her entry. The team from Dr. Congo hadn't made a Men's World Cup in 52 years and hardly made this one because the United States was supposedly worried about Ebola even though no one on the team had Ebola. If you were watching Senegal Norway last week and were wondering where all the Senegalese fans were, they weren't let into the country, but you probably noticed we let in like a million Vikings. I wonder what's different about their fan bases.

35:16Scott Galloway:Oh, and who could forget we're literally bombing one of the countries that up until Friday was playing here. Missiles aren't the problem. But, but somehow the vibes at this World Cup are mostly positive. The World Cup might just be healing us on Today Explained from Vox.

35:35Kara Swisher:Scott, we're back with more news. It's been a big week for the Supreme Court. as it wrapped up its term. Let's go through a round of some of the cases the court ruled on. A court struck down a federal law that bars the president from firing members of the FTC, so no more independent agencies essentially. They lifted limits on how much political parties can spend on advertising and other expenses with candidates, a problem, and more Citizens United, upheld two state laws barring the participation of transgender female athletes from girls and women's sports teams and upheld birthright citizenship, striking down an executive order.

36:07Kara Swisher:Let's hear some thoughts from Leah Littman, who co-hosts the podcast Strict Scrutiny, which breaks down all things Supreme Court. Hey, Kara and Scott, here are some quick thoughts on the most recent Supreme Court term.

36:18Scott Galloway:We came within a single vote, one vote, of saying the Constitution doesn't mean what it says on birthright citizenship and nullifying a constitutional amendment that is the foundation of our constitutional order of multiracial democracy after the Civil War. They have also been systematically undermining our democracy, killing the Voting Rights Act, enabling partisan and racial gerrymandering. They've also just killed campaign finance regulations that were designed to prevent political corruption. As a result, the super-rich will be able to effectively funnel more than$500 ,000 directly to candidates in the upcoming election.

36:52Scott Galloway:and they have been killing Congress's capacity to govern and expanding presidential power against a backdrop

36:59Kara Swisher:of a president who has been engaged in corruption and pay to play. And that is just the start of it. Yes, I think she's sort of articulated it. The ones that really upset me, and the birthright citizenship was far too close, far too close. Agreed. That was disturbing. And by the way, a lot of the Trump people have to go back home wherever they come from. the two that really upset me to me is this the Voting Rights Act obviously but the finance to me it's all the money the finance regulations designed to prevent political corruption that was more Citizens United was the last thing we need and then secondly the ability of the no independent agencies on things that deserve independence like the FTC and you've seen what Brandon Carr has done Although one of the justices did say Brandon Carr is a moron and part of his essentially said that in his ruling.

37:54Kara Swisher:I think it was Kavanaugh. Could have been Gorsuch, whatever. They look the same to me. So those two were like giving more power to the president in general, which I think will be just as bad with a Democrat and is terrible with Trump, was two problems. But the money to me was the focus, the focus I had. What about you?

38:11Scott Galloway:Yeah, Citizens United is arguably one of the worst things that's happened in recent history to the U.S. because of the 900 billionaires, they make up a third of political giving. It's probably more than half of influence because they can be much more targeted. You know, the unions just give money to whoever's the union candidate. it. But a private equity firm can give$700 ,000 to Senator Sinema and say, just be the holdout for the infrastructure bill and ask that they strip out the carried interest loophole. And that costs $20 or$30 billion, which is the most ridiculous loophole in history, see above$2.2 trillion spent on loopholes, where private equity owners get their commission on investment gains in the form of long-term capital gains.

38:53Scott Galloway:It's totally indefensible. So that's bad. The silver lining, the dotted silver lining on this out-of-control spend is that what we're finding is it's gone past its utility. And that is, it used to be 20 years ago, like 97 % of the time who raised the most money won. It's no longer happening. Like Tom Steyer spent a quarter of a billion dollars and didn't win. It's almost like the full local news station employment act. The amount of money they're spending, on the whole, it's really bad. But what you are seeing is it's no longer the key fulcrum for who or the key lever for who wins. The thing that upset me the most, which is so frightening that it was even this close, was birthright citizenship.

39:44Scott Galloway:I mean, this is the constitution. Just straightforward. The constitution says if you're born here, you're a citizen. Yeah. 14th Amendment.

39:50Kara Swisher:It's right there.

39:51Scott Galloway:And I'm going to give you a couple anchor babies. Balligan, who got a red card unfairly, the attack, the premier striker for the World Cup team. His parents were here. I forget, she couldn't go home. He was born here. She couldn't go home because she was too pregnant. She was too pregnant. I think the airline said you're too... Yeah. Good for us, right? And also, it's a fairly small number. It's only 7%. It's a fairly a small number of babies.

40:17Kara Swisher:It is. The whole word anchor baby is so fucking ridiculous.

40:20Scott Galloway:All that, but to a certain extent, this is what we don't like to talk about. Immigration is not only the secret sauce, it's the most, illegal immigration is probably the most profitable form of immigration because they're risk takers and they generally fold back across the border when the crops are picked or there's not enough demand for them and they pay taxes and they usually don't stick around to collect Social Security and they usually don't call the fire. They commit crimes at a lower rate than citizens. The reality is we didn't just wake up and find, oops, there's 15 million undocumented workers here.

40:52Scott Galloway:Republicans and Democrats have looked at each other and gone, wink, wink. It's nice having cheap housing being built in Phoenix, Arizona.

40:59Kara Swisher:Or our grapes picked for cheap.

41:01Scott Galloway:How are we going to get all these people to wipe grandma's ass for 11 bucks an hour? I mean -

41:05Kara Swisher:Asian immigrants are the biggest nurses' aides.

41:08Scott Galloway:I mean, so it's not, this has been an economic decision. Has it gone too far? Absolutely. But be clear, folks.

41:15Kara Swisher:We didn't just wake up and let this happen.

41:18Scott Galloway:So, Balogin is one anchor baby. You know who else is an anchor baby, Kara? Melania.

41:23Kara Swisher:No. Trump. They're in Trump?

41:25Scott Galloway:You could say she's a mail-order bride. She's not an anchor baby. She wasn't born here. That's true. Sorry.

41:29Kara Swisher:Who?

41:30Scott Galloway:Your co-host, Kara. Oh, right. You're an anchor baby. My parents at the ages of 19 and 24 got on steamships from Glasgow and London, respectively, and they landed in Canada where my mom was a stenographer and my dad was a candle salesman. They met at a dance. They fell in love. They had sex there.

41:50Kara Swisher:So the conception was Canada.

41:52Scott Galloway:In Toronto. They claimed they got married and had me. I'm not sure if that's true. I'm not going to argue it. I don't care. But they decided they could not. So you're a bastard also. You're a bastard. That was my dad said. Bastard ankle baby. My dad said a few inches wee short to the blanket, whatever that means. And by the way, he was a bastard. He was born in Australia to an unwed woman who was a nanny at the McVigour family.

42:18Kara Swisher:Their entire family is really -

42:19Scott Galloway:Yeah, literally, we're bastards all the way through. I am the John Snow of John Snows. And anyways, my father, basically, my father's mother freaked out, said to her boyfriend, we got to get out of here. I've already sold the baby to this wealthy family. And they literally went to the dock and got a ship to Glasgow, Scotland. Anyway, my parents, my mom's seven and a half months pregnant.

42:41Kara Swisher:Yeah.

42:42Scott Galloway:They said that we cannot endure another winter here in Toronto. Oh, wow. And they read an article in the Toronto Globe and Mail saying that the best weather in North America was in this town called San Diego.

42:53Kara Swisher:San Diego.

42:54Scott Galloway:So they loaded up my mom's Austin Mini Metro, which is basically a lawnmower with doors. Like if you've ever seen Mr. Bean, that's the car. And seven and a half months pregnant. I had no idea you were. My mom and my dad drove to San Diego, and something like 37 days later, I was born at La Jolla County Hospital. So they were not citizens? They were just visiting. And let me make a flex. What? I'm a U.S. citizen.

43:19Kara Swisher:Why didn't I know this about you?

43:21Scott Galloway:I am a U.S. citizen. I've had to pay U.S. taxes. Yeah. Me and my companies have paid well over$100 million in taxes over the last 30 years. It seems like it's worked out for everybody. Oh, my God. I just want to notify the IRS and the Trump administration. My mother, I am an illegal anchor baby. I think my citizen should be revoked. And by the way, when I sell my next company, I'm going to be in Dubai and I'm not going to be subject to U.S. taxes. I am down for you to revoke my U.S. citizenship. and also abdicate, absolve me of all and refund me of all the tax payments I have made because my parents decided to come to the U.S.

44:00Scott Galloway:and, you know, drop a nine pound stone called Scott in San Diego instead of Toronto. Anyway, I would imagine that there is more of Balogun and Galloway than there are people eating cats and dogs that were born in the U.S.

44:17Kara Swisher:Right, or just showing, or running across the border to be pregnant. The screed from Stephen Miller, who I cannot wait till he gets his reckoning, is astonishing. It's so hateful and, like, ridiculous and full of lies that it's so full of lies. Let's not use the term anger, baby, because it's so gross. It's such a gross way and hateful way of looking at it. I had no idea. Scott, you could have been sent back wherever. Where would you, Canada? Where would you have been sent to?

44:46Scott Galloway:Do you hear that fucking weirdo talking about eugenics, that people should be sterilized before they get here?

44:51Kara Swisher:Yes, I know. Right. Are they not allowed in if they're pregnant?

44:53Scott Galloway:Boss, 1939 Germany is calling and wants you back. I know.

44:57Kara Swisher:Wait a second. Where would you go? What country would you go to?

45:00Scott Galloway:Now?

45:01Kara Swisher:That's the other thing. Where do we send them back to, right? Because would you go to Canada? If this passed, like you would have— Send them.

45:07Scott Galloway:People are leaving. Last year was the first time since World War II we had negative immigration in the U.S.

45:12Kara Swisher:If this lost at the Supreme Court, which it could have, right? Where would they send Scott Galloway back to? Was it Canada or is it England or is it Scotland? Like what country are you from? What country are you from?

45:23Scott Galloway:Well, my parents. You were stateless. My dad was a Scottish or British citizen. My mom became a citizen of the U.S., but I guess back to the U.K.? I don't know. I don't know. I don't know.

45:35Kara Swisher:God, that's interesting, Scott. Wow. God, I had no idea. Well, okay. Well, I'm glad you're safe.

45:42Scott Galloway:I'm opening a bar in St. Barts, so I'm a French citizen. Okay. But then I have to root for Team France, and I just can't do that.

45:48Kara Swisher:Oh, yeah.

45:49Scott Galloway:I just can't do that.

45:50Kara Swisher:All right. Well, this is some news I didn't know about Scott Cally.

45:54Scott Galloway:After seeing Team Japan, has there ever been a product that's been better for the umbrella brand than Team Japan? Did you see what they did after they lost in a heartbreaking loss to Brazil? They all walked over to the Japanese side, and they bowed to apologize to their fans.

46:10Kara Swisher:Oh, they did.

46:12Scott Galloway:I think I'd like, I want to move to Japan anyways. Yeah. I would love to spend more time in Japan. That's a nice place.

46:16Kara Swisher:I've lived there for a couple of months. I loved it. All right. Other Supreme Court news. Wow, Scott, I need to calculate the situation. You need to get me kicked out. I need to get you kicked out.

46:27Scott Galloway:You're like, ah, it is.

46:28Kara Swisher:Calling Stephen Miller. I'm going to ask everyone for their ID when they come and be a guest host. In other Supreme Court news, by the way, NPR retracted an article saying that Samuel Alito, another piece of shit, sorry, Samuel, but you are, had retired. Reporter Nina Totenberg has said she heard retirement announcements were coming and mistakenly assumed it was Alito prompting her team to publish a pre-written story. That seemed like odd. It seemed like that. I think he's probably leaving, right? He's going to have to. You're going to have to. He's got two years left to put in, you know, younger versions of Alito and Thomas, I guess.

47:03Kara Swisher:Correct?

47:04Scott Galloway:Why would you think these people are any less narcissistic than Ruth Bader Ginsburg? They all think they're going to live forever.

47:08Kara Swisher:Oh, they may not leave. Oh, interesting. You don't think they'll do it for the take one for the team kind of thing?

47:14Scott Galloway:Well, that's what Souter did. I think it depends on the individual, and I just don't know him well enough. RBG, I mean, RBG and Senator Feinstein, both lovely, important women who've really

47:25Kara Swisher:Forged paths.

47:27Scott Galloway:Screwed, who really put an unfortunate punctuation mark at the end of the sentence of their career by not believing they would ever die.

47:35Kara Swisher:Yeah. Oh, you think Alito will just stick around because he loves hearing himself talk? I have no idea what he's like. All his things. No idea. And by the way, in Thomas's whatever, his anti-whatever, he mentioned Dred Scott an awful lot, which of course was a terrible thing. 14th Amendment is here to protect all of us. So it's glad that it's there. They're going to try to take it down, but they're going to be successful.

48:00Scott Galloway:Protect podcasting and erectile dysfunction drug sales.

48:03Kara Swisher:Exactly. Anyway, let's go on a quick break. When we come back, we'll talk about SpaceX donating to Trump accounts.

48:14Scott Galloway:I'm Seth Matlins. My new show, Create or Destroy, Reimagining Marketing, explores how every decision a company makes, not just the marketing ones, but the HR, IR, pricing, org design, and planning ones, the ones most don't consider marketing at all, contribute to either creating value or destroying it. Each week, I sit down with CMOs, CEOs, founders, cultural thinkers, the people building, breaking, and reimagining how businesses grow or don't for conversations about what creates value and what destroys it. It's a business show. It's a marketing show. The creator destroys the show that argues.

48:46Scott Galloway:They've always been the same thing. From the Vox Media Podcast Network and the Wisdomist Company. New episodes drop weekly on YouTube and your favorite podcast app.

49:01Scott Galloway:A lot of us probably grew up with mountains of video game stuff. cartridges, consoles, discs, other discs, broken discs, more discs, everything. And now it seems like those discs are gone. This week on The Vergecast, we're talking about why the gaming industry is going all digital and what it means that that's going away. Plus, whether Rivian can take on Tesla, whether any of us can figure out how to Vibecode, and much more. On The Vergecast, wherever you get podcasts.

49:34Scott Galloway:As America reaches its 250th anniversary, how should Americans assess their country's strength relative to the rest of the world? We're moving into a genuinely multipolar world, and that's a world in which every nation is basically for itself, because nations can no longer rely on the United States to protect them. I'm John Feiner. And I'm Jake Sullivan. And we're the hosts of The Long Game, a weekly national security podcast. This week, we sat down with historian and foreign policy expert Bob Kagan to assess America's role in the world at 250 and the future of American power. The episode's out now.

50:09Scott Galloway:Search for and follow The Long Game wherever you get your podcasts.

50:17Kara Swisher:Scott, we're back with more news. The Trump administration has talked with SpaceX about donating stock to the administration's Trump Accounts Child Savings Program. It's unclear whether Elon Musk has agreed to that or how it would be structured. Trump accounts are set to launch on July 4th with over 6 million children enrolled. Other big donors include billionaire Michael Dell and his wife and companies like BlackRock and Bank of America, which have agreed to match donations made by employees. Also, apparently, OpenAI is reportedly also discussing giving Trump administration a 5 % stake in the company.

50:46Kara Swisher:A proposal that would probably involve other U.S. AI companies also giving governments similar stakes. This is, to me, it was really interesting. Paul Graham had a really interesting point. The reason that OpenAI was doing that is because they don't get asked for 10%. Like, I thought that was true. This all feels like a shakedown or you get something in return for doing this kind of stuff. I don't hate the idea of accounts. I hope we will be renaming them from Trump accounts to something else, USA accounts. But it seems a little socialist to me. I don't know. What do you think?

51:21Scott Galloway:Again, it's where the far right and the far left meet with just different objectives and different claims. OpenAI offering the government a 5 % equity stake is essentially to buy protection, neutralize regulation, lock in a government anchor client. It's not patriotism. It's protection money. It's a moat. And you don't think they're going to be the first to get government contracts versus other AI startups. It's also the beginning of what I think is going to be one of the biggest bailouts in recent history, and that is we're starting to see cracks in the wall where there's fewer people, fewer companies have actually figured out a way to create demand.

52:01Scott Galloway:There's only a two now, OpenAI and Anthropik consistently. And their spend and CapEx commitments are so out of control that I think Sam Altman says, I like the idea of the full faith and backing and maybe even government-backed debt from the president. And here's the bottom line. The government should not be taking equity stakes and companies. They just shouldn't. And I mean, there are some exceptions occasionally when I do think you can make an argument in the Great Financial Recession that it made sense for the government to bail out the automobile industry because it was a huge employer. But they didn't start saying you can only buy Fords or occasionally.

52:43Kara Swisher:They saved Tesla's ass back when it used to.

52:45Scott Galloway:These companies have gotten trillions of dollars in market cap. Let them run. I mean, this is just straight up cronyism. Privatize the gains, socialize the losses.

52:54Kara Swisher:Can I ask you a question? One of the things, Alskarp seems insane every time he opens his mouth and, you know, hopped up on something. But he was going on sort of trashing. Very cogent.

53:04Scott Galloway:I thought he was very cogent. I do too.

53:06Kara Swisher:And I had to listen for a second because he's so nuts. He always throws in some nutball thing on the side in his manner. But what he was saying is something that Mark Cuban had said to me previously, is this token maxing is going to come back to bite people. And that when people find people are cheaper than the tokens, it's going to sort of collapse. Mark Cuban said this absolutely first to me months and months and months ago. And CARP was articulating this idea of these open systems, mostly from China, as you predicted, Scott, taking the place of, you know, with regular corporations. And two things he was saying is, one, keeping your data yours and not giving them to open AIs and anthropics.

53:48Kara Swisher:And secondly, the cost of these tokens is really untenable. And as nutty as he is, and he took a number of slaps at competitors because he can't help himself. He made a lot of sense. I can't believe I'm saying this, too. But he did. I had to listen to it twice, and I was trying to think if I could put it in someone else's voice. Because every time I hear him, he says nutty things. But this is the kind of thing. I was like, this is going to collapse. And a bunch of economists, all of these world economists are all worried about these cracks that you've talked about. So talk a little bit about this, because this idea, you had the idea of China, these open systems from China replacing and sort of knocking the stuffing.

54:30Kara Swisher:You have these economists saying this, you have CARP saying this. Again, I want to give credit to Mark Cuban for being the first to mention it to me. Talk a little bit about this, because all this like government intervention seems really problematic going forward.

54:44Scott Galloway:The government intervention is bailout cause plan growth. And CARP is right. Cheap models are eating the expensive ones. the token consumption of Chinese models has surpassed the token consumption of frontier models in the U.S. Because all of a sudden the CFO of Uber goes, our entire AI budget was burned through in eight weeks. And I don't see any consumer talking about the improvement in ride hailing service.

55:11Kara Swisher:I don't - Or it's not improving it. It's not improving.

55:14Scott Galloway:Well, it's sort of like experimentation is over. This can no longer be a magic trick. You either have to incorporate this into the plumbing and show me ROI. We're going to reduce our budgets here. And AI is following kind of the same curve as cloud computing, and that is margins compress. This reminded me of 99, and tell me if you think this analogy is apt.

55:37Kara Swisher:Okay.

55:37Scott Galloway:Okay. So the internet comes and we think everyone's going to buy their dog food and their cars, and Pepsi's going to buy their sugar online on the internet. And we're all going to buy not just CDs and books, but we're going to buy everything online. And there's the front layer. So everyone invests in Amazon and eToys and pets.com. And it ends up that they're just not nearly creating enough demand and not enough commerce is going through e-commerce to justify anything resembling the valuations these companies are getting. So they go, oh, wait, we're not sure which part of the application layer, which LLM, if you will, is going to win.

56:12Scott Galloway:so let's all invest in the infrastructure layer. And everyone invested safely in like, I can't pick the winners, so I'm going to invest in Cisco or in telco infrastructure. And Cisco hit an all-time high, lost 93 % of its value from 99 to 2001. And I see kind of the same thing here where everyone's saying, all right, let's invest in the demand side. You know, XAI, Llama, Grok, Claude, ChatGPT. And all of a sudden, it looks like the demand may not be as exponential as we thought.

56:48Kara Swisher:Or it's too costly.

56:49Scott Galloway:Or it's too expensive. Yeah. Which lowers demand. And some of the players who thought they were going to need infrastructure for their own demand, specifically Meta and XAI, have said, we overestimated the demand of our own LLM, so we're renting out our infrastructure. Right. Which is smart. In a matter of 30 days, it looks like we've gone from a supply crisis to a demand crisis. And what you'll see, I think, is just as in 99, the first companies to crash were the B2C. Then it went to B2B. Oh, wait, not pets.com. Let's go to, remember, Internet Capital Group? Well, they're selling sugar in between, you know, from farmers, right?

57:27Kara Swisher:I totally forgot about that. I wrote so many stories about that.

57:29Scott Galloway:It had a valuation greater than General Electric. And then everyone figured out no one was buying fucking anything. And it was easier to fax your orders than it was to go on the internet capital group website. And then everyone went to B2C, then B2B. B2C gets creamed, B2B then gets creamed, and then the infrastructure guys got creamed. I think we're sort of going through a similar cycle right now.

57:53Kara Swisher:Overbuilding.

57:54Scott Galloway:And we're starting to see the beginning of the cracks at the application layer saying, people are questioning the amount of money they're spending on Anthropic and OpenAI. What's evidence of that? OpenAI and Anthropic are considering delaying their IPOs.

58:09Kara Swisher:Yeah, I agree. And I do think one of the things I think will recover would be computing demand because there's only going to be more computing demand eventually. And I think that's what happened with all those Internet companies. Like, look, there were a million. Like, I forgot about ICG. Oh, my God. You just brought me back. You know, everyone remembers Pets.com. But, you know, eventually there'll be a Google, right? Eventually, there'll be a Facebook.

58:34Scott Galloway:The technology will survive. Right. These companies will survive.

58:37Kara Swisher:I would bet computing is an area you would want to eventually, like, once it crashes, buying it up would be a smart thing, right? Computing apps would be an important thing, like understanding where it's going. But you're right. A lot of these companies aren't ready to buy these things, and prices have to come down. And then that'll have a knock on effects of Oracle and all the others who have, you know, a lot of other companies will be affected in the blast radius of this. I agree. I think these economists, I was reading the report from this thing, and usually I don't pay that much attention to like predictions, but I was like, this makes perfect sense of where it's going.

59:15Kara Swisher:And it does have a feel, you're absolutely right, of 1999.

59:20Scott Galloway:Amazon's an amazing company. From 99 to 2001, it lost 92 % of its value. Meta is an amazing company. Four years ago in 2022, it lost 72 % of its value. These companies, the natural curve of these companies is very volatile. And the technology and these companies will survive and they will be great companies. Or can they go down 90 % in value? The answer is yes.

59:49Kara Swisher:Yeah, I agree.

59:49Scott Galloway:This feels, it just feels so 99 to me. It's like I would say.

59:53Kara Swisher:Government meddling makes it worse. The government. Oh, yeah.

59:56Scott Galloway:Propping them up. Because Trump is like, my entire administration, America is a giant bet, whether it's the GDP growth, capex spending, earnings growth, and the S &P is all a big bet on AI.

1:00:09Kara Swisher:His political money. If these guys go down, it's going to be really rough for me.

1:00:13Scott Galloway:I'm telling you, a bailout is coming.

1:00:15Kara Swisher:Yeah. One would assume. Yeah. Because they're the future of America. Yeah, you're right. 100%. All right. Scott, one more quick break. We'll be back for predictions.

1:00:31Kara Swisher:Okay, Scott, before we get into this week's predictions, I want to play a prediction you made last week at Cannes.

1:00:37Scott Galloway:My prediction is the biggest IPO in terms of first-day pop is going to be a European, the Berkshire Hathaway, I've forgotten, internet brands. And that's this company called Bending Spoons that I had not heard of until two weeks ago. I'm kind of fascinated with it.

1:00:51Kara Swisher:Well, Scott, take a victory lap. Bending Spoons surged 40 % after the company's IPO this week. What's next before you get to your prediction?

1:01:01Scott Galloway:Well, so first off, the company was up. So SpaceX was up, I think, 22 or 23%. We predicted it would be up 20. Bending Spoons was up close up, I think, 42 % yesterday. Yeah, 40, yeah. They're going to have to show that they can scale a model of buying stuff at, you know, ex-EBITDA and then...

1:01:20Kara Swisher:Orphans.

1:01:21Scott Galloway:These orphans and then substantially reducing costs, which is Latin for hire younger people and replace the expense of 40-year-olds. And to their credit, they have some of the highest revenue per employee of any digital company right now or any internet company. But they're going to have to show that they can consistently make these accretive acquisitions. What this really is is like Martin Surrell kind of pioneered this model. He went and bought all the big agencies. I don't even remember them now. Ogilvy, Mather. He could go in and buy these companies at seven times EBITDA or eight, and they'd immediately, he'd take their earnings and the market would reward them with 12 times.

1:01:58Scott Galloway:They're going to have to show that they can, that this model, this private equity-like model of acquiring companies, they don't get them cheap. They get them for a good price, you would argue, that their ability to reduce costs, continue to see growth, add some growth organic, and then the market will give them a markup. They're going to have to show they can continue to do that.

1:02:17Kara Swisher:slightly down right now today. They're going down today.

1:02:20Scott Galloway:Well, to be clear, the valuation last year was about$7 billion. It came out at$19 billion. It's trading at about$23 now. The stock's not expensive, but you would argue that they're going to have to show sooner rather than later their ability to continue to scale these types of accretive acquisitions. But I thought when I talked to, when I looked around and I said, okay, all of the oxygen had and sucked out of the air for SpaceX. And when these guys came out at seven or eight times earnings and all of those brands, and the fact they were only raising a billion and a half dollars, I thought this thing's going to get...

1:02:57Scott Galloway:I mean, this is the sad part about IPOs. This is what I believe JPMorgan and Goldman Sachs are doing, and that is they use AI and their incredible market insight and their incredible marketing machine. They are the new engineers. They engineer a 20-plus percent pop on day one because the reality is that is the ultimate branding event. Everywhere in the news today is that Italian company Bending Spoons is up 20%. And personally, I wanted to see the company go up, and the reason I brought some sunlight to it was because I am so sick of talking about American AI companies. I love the idea of a European company that's not AI.

1:03:34Kara Swisher:And also cleanup, a cleanup company. You know what's interesting is that, just looking at the meta thing, They're at 20, the P-E ratio is 20, which seems healthy. And that SpaceX is valued at$500 million more than them is insane.

1:03:53Scott Galloway:That makes no sense.

1:03:54Kara Swisher:I don't care how good they are at robots. It's just nutty. What he'll do is he'll fold Tesla into this, but as I've said many times.

1:04:01Scott Galloway:Which is another anchor. Two anchors.

1:04:03Kara Swisher:Yeah.

1:04:03Scott Galloway:Two anchors going to each other.

1:04:06Kara Swisher:But it is, there are some real values here, right? Like Meta seems to be. I mean, I don't usually make -

1:04:12Scott Galloway:Meta on a price earnings basis, I don't think has ever been this cheap. And the cheapest of them all, and it was my big tech stock pick for 26. Amazon has never had a price earnings ratio this low.

1:04:22Kara Swisher:Yeah, what is theirs? Well, you know, Alphabet is 27, Meta is 21. Amazon, you're right, is low, 29.

1:04:31Scott Galloway:Yeah, and it's usually, it's average over the last 20 years has been 55. And anyways, industrialized robots all gone forever. But so my prediction is that essentially, and I said this, we're starting to see cracks in the wall around evidence. And I think it's nuanced, not definitive. It's not cracking because AI doesn't work. It's cracking because investors are starting to ask much more pointed questions specifically. Can we actually earn a return on the trillions of dollars being spent here?

1:05:09Scott Galloway:and there's evidence that the narrative around AI is changing, and that is CapEx is outrunning monetization. The largest cloud companies are on pace to spend$600 to$700 billion on AI infrastructure just this year, yet many enterprise customers are struggling to demonstrate measurable ROI. And that is the narratives move from can AI work to can AI pay. And it used to be spend more money. This is the future infinite demand. And it's like, whoa, hold on. CFOs are starting to tap the brakes here. And the market is splitting. JP Morgan noted the divergence. AI infrastructure suppliers continue to outperform.

1:05:54Scott Galloway:And the company is writing the biggest AI checks. The hyperscalers have begun to lag. And that's reminiscent again of late stage infrastructure booms where the suppliers prosper before the customers earn adequate returns. And also Wall Street as it does eventually focuses on ROI. And the debate has shifted from 12 months ago, the debate was who can build the biggest model? Now it's who can make money. Right. Yeah. And one of my role models here are this fantastic chief economist who, by the way, has, I think, a much better sense of humor than certain chief investment officers at other big banks.

1:06:30Scott Galloway:Apollo's Torsten Slock.

1:06:32Kara Swisher:Does he like a dick joke?

1:06:34Scott Galloway:I think Torsten loves a good dick joke, but I'm not going to speak for him. I'm not going to speak for him. But he puts out these fantastic emails every day with a chart. And he argues that the markets may be pricing and productivity gains that will take years, not quarters, to materialize. We're starting to see central bankers issue warnings.

1:06:53Kara Swisher:Yeah, they are. They're all over the place. And here's the thing, Kira, if the AI

1:06:58Scott Galloway:trade unwinds, the most vulnerable names are generally the ones whose valuations depend most valuable on continued AI infrastructure spending. The tier one risk level is NVIDIA, Astera Labs, and Marvel Technology. These companies are extraordinary businesses, don't get me wrong, but they're the most exposed to a slowdown in GPU and networking demand. Yeah, they're the Cisco.

1:07:19Kara Swisher:NVIDIA is the Cisco.

1:07:20Scott Galloway:And then the tier two, Vertiv, Supermicro, Computer, CoreWeave. These are effectively picks and shovels for the AI gold rush. And then you go to the third level, the Microsofts, the Alphabets, the Amazons, the Meta. There would be nowhere to hide here. And that is, the technology story is intact. It's just that the valuation story is beginning to get stress tested. And I don't think it's going to survive that stress test. So what's the prediction? you know all eight or ten of those companies a basket of them uh down 20 to 40 percent in the next 12 months and by the way still great companies the technology will survive i believe that the the better ai players are going to be juggernauts in five to ten years but we are entering uh these guys are just way out in front of their skis yep i would agree i'm going to make a short prediction

1:08:13Kara Swisher:too. The thing that we'd started beginning with the Trumps. I just noticed this New York Post on Trump family corruption, which was interesting. I think it's not Trump that's going to pay for this because I think he's going to die before we can get to him. But I think his children and the children of the Lutnicks and the rest are going to get it. I do think they're going to get it.

1:08:31Scott Galloway:You mean be prosecuted?

1:08:32Kara Swisher:Yes. Here's why. This is the New York Post. The Trump sons, meanwhile, are part owners or investors in companies neck deep in key defense contracts to mine Tungsten reserves in Central Asia. It stinks to high heaven. If the president's family making bank from obscure resource companies and the former Soviet Union sound familiar, maybe it's because Hunter Biden's lucrative connection in Burisma, Ukrainian gas company, was a major scandal in the 2020 election and beyond. Republicans, including Donald Trump, were justifiably outraged at the obvious influence peddling. These kids are going to pay a price.

1:09:05That's my prediction years from now.

1:09:06Scott Galloway:You don't think they'll get pardons?

1:09:08Kara Swisher:I think he'll try, but I think there's all manner of ways to get to them. I just think they're in for a lot. That's my prediction. Anyway, but I think it's all part of the same thing, like you're talking about. We cannot save these internet companies. We cannot keep intervening for friends of Donald Trump or family members. Anyway, it's gross. Socialism is really what it is. Communism, really. Anyway, we want to hear from you. Send us your questions about business tech or whatever's on your mind. Go to nymag.com slash pivot to submit a question for the show or call 855-51-PIVOT. Okay, that's the show.

1:09:43Kara Swisher:Thanks for listening to Pivot. Be sure to like and subscribe to our YouTube channel. And please beg the chief investment officer of that bank to forgive Scott so we can start telling dick jokes again. We'll be back next week.

1:09:57Scott Galloway:But at least the dick jokes. Today's show was produced by Lara Neiman, Zoe Marcus, Taylor Griffin, and Todd Wiseman. Additional assistance from Kate Gallagher and Brad Sylvester. Ernie and Todd engineered this episode. So thanks also to Drew Brosme, and Dan Chalon. Nishat Karoua is Vox Media's executive producer of podcasts. Make sure to follow Pivot on your favorite podcast platform. Thank you for listening to Pivot from Vox Media. We'll be back next week for another breakdown of all things tech and business.