The UnitedHealthcare CEO Shooting, Amazon Takes On Nvidia, & 12 Days of OpenAI

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1:35Or what that clunking sound from your dryer is? With Thumbtack, you don't have to be a home pro. You just have to hire one. You can hire top-rated pros, see price estimates, and read reviews all on the app. Download today. Today's number, 170 ,000. That's how many unique drinks you can order at Starbucks. True story, Ed, I walked into a Starbucks with my ex-wife, and the barista said, we don't recommend caffeine for pregnant women. And she said, well, I'm not pregnant. And he said, well, we do have diet-free lattes.

2:17Diet-free lattes does not make sense. Diet-free, sugar-free. Fuck it, I'm in the Cotswolds. Let's skip to the banter part. I'm in the Cotswolds with my dogs. Oh, lovely. And we're moving. So my job is to leave, take the dogs out to the countryside and stay in some bougie place and just be out of the way. So here I am. Are you staying in a hotel or you got a house? What's the deal? It looks pretty nice what you got behind you. It's called Heckfield Place. And I was going to go to Manor Estelle, but they didn't have any room. And then Soho Farmhouse could put up the dogs. So Heckfield's kind of a, it's the Lexus.

2:55Soho Farmhouse has a no dogs policy? No, only certain rooms, only certain sheds allow dogs. They all claim to be dog-friendly, and they have like two rooms for dogs. And I can kind of understand, because don't tell anyone, my dogs have ripped up this place. Jesus Christ. But we go on long walks. We're in the British countryside. I keep thinking I'm going to run into Ellen. Supposedly Ellen lives out here with her wife, Portia de Rossi. Yeah, she escaped once she got kicked out of the U.S., basically. Isn't the British countryside the best? It really is incredible, right? Let me think. Let me pour some tea first.

3:36I'm going to go with a no from you there. You just don't really like the outdoors. I think that's the problem. I don't like the U.K. from November to May. It's 40 degrees and just wet. I don't even see it rain. I just walk outside and it's wet. I'll give you this. When I first moved to New York, people said, oh, there's beautiful beaches in Long Island and the Hamptons. And I thought, I'm from California. These won't be beautiful beaches. And I went out there and found out that the beaches are beautiful. People constantly talk about the British countryside. And I thought, you know, yeah, right.

4:03And I came out here. It is beautiful. It's just, it was dark at 3.30 today. That's all part of the vibe. You just got to get involved with that and get on board. No, I just want to listen to Simon and Garfunkel and self-harm. It's just. That's not the vibe. Simon and Golf Uncle, get inside, have some tea, head to bed pretty early. Yeah, what have you been up to, Ed? Here, we're always talking about me. Let's talk about you, but keep it short because I'm not that interested. Well, speaking of weather, it snowed for the first time today, which is pretty exciting. So New York is getting cold. And that's the long and short of it in New York.

4:40Wow, are you engaging? He's a charmer. He's a charmer. Get to the headlines, Ed. Jesus Christ. That's right. Let's start with our weekly review of Market Vitals.

4:58The S &P 500 rose. The dollar rose on Trump's tariff threats, but declined at the end of the week. Bitcoin hit, wait for it,$100 ,000 for the first time. And the yield on 10-year treasuries was volatile, shifting to the headlines. Salesforce shares rose more than 10 % after the company issued higher than expected guidance for the current quarter. Revenue also beat expectations up 8 % from a year earlier as the company secured more than 200 deals for its AI chatbot suite called AgentForce. Meta is seeking proposals from developers to construct nuclear power plants. The initiative aims to get the plants online by the early 2030s to help power the company's data centers.

5:39UnitedHealthcare CEO Brian Thompson was shot and killed in what the authorities are calling a brazen targeted attack. The incident occurred just before the company's highly anticipated investor day in New York. I don't really know what to make of this, Scott. We've never covered anything like this. I guess the first question I'd ask you is, what do you think this means for UnitedHealth? How is UnitedHealth supposed to respond to a crisis like this? Well, it's a tragedy for the family, no doubt about it. I think United's going to be fine. But what's come out, which was really interesting, I found, is that the etchings on the casing said, deny, defend, oppose.

6:21And this is the name of a book that's about how insurance companies get out of claims. And so this appears to be politically motivated or thematically motivated. What's been shocking to me has been the response online. And to say there's been a lack of empathy is an overstatement. People are circulating memes and acting as if, kind of quite frankly, the company and this person had it coming is the way I read some of the memes I've been saying. And in the U.S., what you have is a healthcare system that is essentially bankrupting a lot of people. 40 % of Americans have some form of debt as a function of dental are medical bills that they can't pay off.

7:05And the largest source or largest cause of bankruptcy is medical debt. And there's just no getting around it. The American healthcare system, in my view, is optimized for the top 10%. If you're in the top 10%, you have the best healthcare in the world. If you're in the bottom 90%, you have expensive but bad healthcare. When income inequality gets to the point it's at, it usually self-corrects, but it self-corrects in a small number of ways, either through war, famine, revolution. And I think this is an example when you have, you know, the CEOs of companies being murdered and it looks like it was politically motivated.

7:39It looks like it has some connection or link to the company and a viewpoint around the behavior of these types of companies. The healthcare system in the United States in this in no way justifies violence, but it does create a lot of despair and disability in our economy. What do you think the conversations in the boardroom are right now? Do you think if this is indeed politically motivated, and it looks like it was, do you think the boardroom is like, okay, people are angry we're going to change the way we do things? Or is the boardroom thinking we need to up our security? I mean, just some statistics here.

8:21Meta spends$23 million on protecting the personal safety of Mark Zuckerberg, and Google spends$7 million. So a lot of other companies know that people are kind of out to get their CEOs, and United Health, I don't believe, spends any money on executive personal safety or security. So what do you think is the response at the board level from United Health when something like this happens? Does it actually force them to sort of take a look at their business and how they make money? Or is it more like we need to do a better job of protecting our executives? Yeah, I would imagine the first reaction is we need to keep our executives safe.

9:03Those numbers that you quoted around CEO security are about to explode. That's a good business to be in right now, offering executive security. This isn't going to be a moment of reflection for them. Like most for-profit companies, they do whatever they can to try and maximize their profits. unrationalized, like, I know, let's get some insulin, let's put a brand on it, and let's quadruple the price or whatever it is. But they're not going to say we need to really think through healthcare in the United States. Yeah, exactly. But that's what everyone online seems to think is happening here. It's like all those trolls that you mentioned, they're like, oh yeah, well, someone finally showed them.

9:41This doesn't help the problem. It makes it worse. It makes it seem like the people who, I mean, this is just in any way, if the murder of a 50-year-old man with a family is rationalized, you get a pretty serious chaos. And just the fact that these folks need security now is really, you know, it's disappointing. So the short term, it's just going to be those numbers are going to go way up. You're going to see security across every, I got to imagine every CEO of a health company is saying, do I need security now? Should it inspire a moment of reflection of why does everybody hate me or why are there so many people that hate me?

10:20Yeah. Will that happen? No. And the guilty party here is not the CEO of these companies. The guilty party is the electorate who continue to let their elected representatives be weaponized by lobbyists from the pharmaceutical and the healthcare industrial complex such that they can charge more for pharmaceuticals. They can charge more for diabetes medication. They can let insurance companies, you know, deny all sorts of claims. So the U.S. healthcare system is the most disruptable business in the history of business. It's raised prices faster than inflation at 17 % of GDP. It used to be 5%. I think as recently as 1962.

10:55So in 60 years, it's now almost four times the amount of our government. It's the biggest business in the U.S. And we need to turn folks into consumers again, where they actually look at the price and they demand more. But this is going to inspire a lot of very interesting conversations. I'll just leave it at that. Let's move on to Salesforce earnings now. There we go. Salesforce, the agentic layer. They're killing it. They're reeking or getting efficiencies internally. Their quarterly earnings increased 8%, which isn't amazing, but it beat expectations and their operating margins hit their highest number ever.

11:36And current quarter guidance came in strong overall. Full year guidance for revenue growth stayed the same. Is this a little bit of rah-rah? Yeah, because if demand for the agent force was really as revolutionary as Mark Benioff described it, they probably would have guided up. I mean, NVIDIA says, this is revolutionary and we're taking our guidance up. They're like, this is amazing. It's revolutionary, but we're maintaining guidance. Yeah, I think the story of this owning is called Was AI. They mentioned the word AI 21 times, and they mentioned the word Agent Force 67 times. So they are very optimistic about AI.

12:10The question is whether that will actually pan out in the numbers themselves, because they talked a lot about Agent Force, and they said that they've signed a lot of deals with Agent Force. And Salesforce only launched Agent Force a month ago, so we don't know yet. So I think the thing that we'll want to keep an eye on over the next few quarters is whether or not agent force this new ai bot army is hype or if it actually is going to have a meaningful impact on revenue because you know just saying over and over again it's great it's great it's great we're so excited to deploy it that's just not really that's not really enough for wall street i don't think and let's just wrap up here with meta's new proposal for nuclear power plants, or at least they're seeking proposals from other development companies to construct nuclear power plants.

13:01Do you have any initial thoughts on that? Well, it's interesting. These companies are now kind of taking on the role of government in the sense that the only people who have the capital to build nuclear power plants is either the government or a giant utility that was government regulated and given a monopoly. I mean, nuclear has just had such a terrible brand. I remember I was in fixed income at Morgan Stanley and going up to Washington for a dinner. And there was something called the Washington Public Power Supply, which was supposed to build a nuclear power plant. It overran and it ended up being just this giant hole in the ground.

13:30I'm not sure if it ever finished or not. And they used to call the bonds whoops bonds. And there's just been, it's been so out of favor. And all of a sudden it is white hot because the friction in AI isn't people, it isn't customers. It's something unusual. It's energy to power it all. And we said in our prediction stack that nuclear would be the technology of 2025. Why nuclear? It's reliable, efficient, carbon-free, and powerful. One nuclear plant produces as much energy as 3 million solar panels or 430 wind turbines. And there's just a few ways to kind of spin up in three to five years something that could potentially power 750 ,000 to 3 million homes, which is what AI is going to require.

14:16Meta's energy consumption increased 1 ,500 % in the last 10 years. And in August, Zuckerberg said LAMA4, Meta's next generation of their AI model, will need 10 times more compute to train than the previous generation. I think the thing that jumped out to me is the point that you made about the idea that you have Meta basically taking on the role of the government at this point. Because the thing that Jigar Shah told us, and this was the head of the loan office at the Department of Energy, is he said, you know, we need the government to be funding this because we're the only ones with the capital to make these risky investments.

14:54I mean, you look at Vogel, the new big nuclear plant in Georgia that was just built. That thing cost$35 billion to build. And it went$17 billion over budget. So these things are extremely capital intensive. but to your point it's like actually there is another entity that can make these forward leading investments and it is big tech you know it's it's meta it's amazon it's google it's potentially apple at some point and i guess where my mind goes it feels a little bit dystopian that we're at a place in society where the two gatekeepers of the future of our energy industry are one, the government, and then two, like a handful of tech executives.

15:45Like the idea that Mark Zuckerberg, who originally was the guy who built a social media network, and now he's kind of shepherding the direction of clean energy in America, which will just give him even greater and an even tighter grip on all of the infrastructure in the U.S., from advertising to computing power, and now to just pure, raw energy. Maybe I'm being a little bit, you know, tin hat, but it just feels like we're going into a slightly scary place. Well, you've got to ask yourself, what's next? They control the news or can elect a president? You're just figuring this out, Ed? Wait, let me get this.

16:27your thesis is that tech executives are growing too powerful that there might be a problem here. Huh, really? It's almost, this is the least mendacious thing that Meta's done. I mean, if they, I don't know if there's a way for the government to get the middle and say, okay, it's like when they build a building or a developer wants to build a skyscraper in downtown San Francisco, they say, fine, but it's not going to be as big as you want. And you have to build a park or 10 % of the residences have to be for artists or whatever, for people raising allergy fee, labradoodles or whatever. I think this is a good thing.

17:05I think that AI, similar, one of the things that always bothered me about crypto is it seems like we have this self-invented incremental usage of electricity that's equivalent to Argentina and that it's, I'm not sure that we really needed that. But this is going to make that energy consumption look like a walk in the park. This, in my view, is the most exciting technology outside of GLP-1 drugs. I think it's really exciting, and I'm glad they're making these sorts of investments. The key is, do we need some sort of oversight to make sure they don't begin to sequester all power to a small number of companies and then use that as a weapon where other companies are basically dealing with brownouts every day.

17:47We'll be right back after the break with a look at how Amazon might start competing with NVIDIA. If you're enjoying the show so far, hit follow and leave us a review on Prof G Markets.

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20:19We're back with ProfG Markets. Amazon is building an AI supercomputer known as an ultra cluster that will be powered by hundreds of thousands of its own Tranium II semiconductors. conductors. The chip cluster will quintuple the processing power for AI startup Anthropic, which recently received an additional$4 billion investment from Amazon. And when the cluster goes live next year, it will be one of the largest AI training clusters in the world. So, Scott, I think the most important thing here is the fact that Amazon is deciding to build a giant supercomputer not with NVIDIA chips, but with its own chips, these Tranium 2 chips.

20:59your thoughts on this news. I was really, well, one, you know, I haven't participated in the kind of the Bitcoin explosion and I haven't really participated in the AI explosion. And I was happy to see this because I own Amazon stock and I just thought this was brilliant and really exciting. And I love the idea of NVIDIA having a competitor. I wish it was a smaller company, but it reminds me that some kid or some PhD student, you're too young to remember this, 10 or 20 years ago, So strung together a bunch of Nintendo game sets or game consoles and created like a supercomputer, just stringing these things all together.

21:34And this architecture just seems really fascinating. And as you said, if they can in any way, in any way, somehow create a credible competitor around their chips, even in the same universe as NVIDIA, just their operational excellence, their B2B, their cloud offering. you got to think they're going to take a trillion dollars in market cap away from nvidia so i thought wow this is really exciting for amazon shareholders and and they're kind of offering cost reduction and control by reducing reliance on nvidia amazon can now lower ai infrastructure costs for its business customers while gaining greater control over its supply chain i mean this is i just thought this was you know whenever you get a company that comes out of nowhere and becomes the most valuable company in the world.

22:25It's just imagine, you know, Lake Erie of blood being poured into the water and the megalodons it attracts. And this has attracted one of the scariest megalodons in the history of business, and that is Amazon. And they have the money to do this. The firm's most recent$4 billion investment in Anthropic included an agreement that Anthropic would use Amazon's AI chips. So the number two in LLMs is about to use Amazon chips, which will train the chips, they'll get better on it. NVIDIA stock fell 3%, but that's not that big a deal. And just one add-on here, Amazon is already trading at a pretty rich valuation, but it's potentially gonna get some of that NVIDIA or that GPU magic.

23:07We did a predictions podcast on Pivot, and we asked Anthony Scaramucci, our friend, to come up with a prediction. And his big prediction is that he thinks that IBM is gonna explode. Because IBM actually has some really strong IP and scientists around AI that effectively Watson was the first kind of AI offering. And then he thinks with their CEO and their current offering that this stock is going to explode. And I thought, wow, that's a really interesting take. But it'll be interesting to see what companies are able to draft off of or kind of become remora fish on NVIDIA and OpenAI success. But I just thought this was genius.

23:42I mean, you got to give it to the folks in Amazon. I feel like this is a masterstroke. Yeah. Yeah. It's also just like the perfect marketing message too, because I mean, when you think about standard marketing, the standard play is that you go out in public and you'll just like say out loud or you'll advertise like we have the best chips in the world. Or maybe you'll like have some research report that says, you know, our chips are, you know, 5 % faster than Nvidia's or whatever. And that's what we've been seeing most of these chip maker competitors doing right now. You just sort of make a statement about your chip.