Chamath Palihapitiya Goes All In on AI, SPACs, IBM, & Politics 7/14/26

25:17How many clients or patients or customers do they serve? The answer is millions to tens of millions. How have they grown revenues and traction since that happened? And the answer is, in some cases, doubling and tripling. So if you want to take a fair look at it from a 360-degree view, there are some parts of it that worked. And the part that didn't work, I went out of my way to relaunch a SPAC just to show you how I can address the speculator class. Because it always worked, I think, for the entrepreneur. Oh, there's no question that the SPAC process was good typically for the entrepreneur and invariably maybe even good for the company and employees.

25:59I'm not arguing about that. I'm arguing that, and I think anyone who was watching at some points when we used to talk about these things. I completely agree with the point. I agree with that. And they would say, look. It didn't work for them. You told me this would be a great thing. It may not work again. By the way, it may not work again. But at least this time, the way that I structured this second time, let me maybe just take a step back and talk about why do I do this? I'm running a tech company. I don't need to do it. Why do I do it? I think the through line for me is I don't like it when I see markets that are gatekept by a few people.

26:32I don't like it. It bothers me. And my entire working career, if you actually say what's the through line from Facebook to now, I tend to go after markets that need democratization. Whatever, that's an overused, jargony term. But Facebook was democratizing information. Social capital, I democratized a lot of investment, okay? The fact was I didn't like the idea that two or three banks sat as the gatekeeper between companies that should be funded and exist and their ability to actually serve customers. Because what happens is, and you can see it in these banks' earnings, and I'm not saying they're doing anything wrong.

27:10They're doing something totally legitimate and right. But at the end of the day, those folks structure liquidity for companies based on their ability to embed gains to their best customers. That's the game. So if you hear that OpenAI cannot go public this year, that has nothing to do with OpenAI. That has everything to do with who is lead left and who is lead right, deciding how much embedded gain they can transfer to their best clients. My point of view is find a different way. There are many different ways. Direct listings are away. SPACs are away. Reverse mergers are away. But if you could go back in time, do you think you would have done the SPACs again the way you did them?

27:53The thing that I would have changed is I would have had nary a comment on Twitter. I would have not come on CNBC and talked about them at all. That was a huge mistake. And at the time, I think I was also learning about the influence that I had, and I was kind of learning to deal with it. I think six years later, seven years later, the 2021 me versus the 2026 me, the 2026 version of me would say, we don't need to say that. We don't need to say anything. In fact, let's just be very clear. Everybody stay away. I'm doing this because I have two very specific goals. One is. You're talking about your current project.

28:29Yeah. Well, the SPAC that I did now has two very specific goals. One is just to create an architecture that I hope people copy, which is you cannot get paid unless the stock goes up. Do it over time. set huge goals in the out years for performance. So now there's complete alignment. And the second - And you're locked in. Yeah. And the second, which is much more practical, is I look at the United States, and there are these huge gaping holes where companies need capital to do very important things for the United States that they will not be able to get because they do not check the obvious box for the gatekeeping banks.

29:06And unless you fix that problem, you are going to have a serious problem on your hands. But it just sounded like you said, look, I want to raise money for the companies and I want the hedge funds to do good. And hey, these speculators, they're speculating and they lose their money all the time. They should just buy or beware. They should have known they were going to lose their money. That's what it sounded like you said. I think that I should have been much more circumspect and said nothing, nothing. And this time you'll hear me say nothing. Was there a way that they could have gotten a fair shake along Along with the hedge funds and the companies?

29:39I think that that is, again, the structural things that need fixing. So the next version after this version that I would hope somebody does is they just post all their own money. So like right now, the way that the SPAC works is that you post a little bit of it and you still need to raise from outsiders. But I've talked to Paul Atkins about this. I'll post the hundreds of millions of dollars. Now it's a turnkey IPO. It's all my risk. If I find something I like, I'll just underwrite it. I'm giving that company the hundreds of millions that they need and they should go public. That kind of stuff, where there's all of these folks who could then do that and copy that.

30:16All the hedge funds could do it. All of the big buy-side organizations could do it. That could be a really important thing for what we need to happen right now, which is more companies should be public, not less. And more money should go into critical infrastructure, not less. And right now, if you put a handful of financially motivated actors in the middle of that, you are going to see. Should they go public earlier? Yes. Yes. Yes. Transparency is better. Yes. Absolutely. Performance pressure is better. It's all better. There is no version of this example where staying private forever is rewarded over the long term.

30:54Somebody will get screwed at some. By the way, we haven't talked about the state of California and Paramount and this Warner Brothers deal. I wanted to ask you just about, frankly, the state of California and the regulatory complex these days and sort of how you're thinking about what's going on in the state that you call home right now. It's given me everything. So I will not leave and I will keep building companies there and hiring people there. And, you know, if there's taxes that I have to pay, I'll pay these taxes. But I just think that at some point we're better off addressing the core issue of why people believe this form of governance actually makes sense.

31:36Is it because they actually think it's better? Or is it that they're just angry about a bunch of other things? And I think it's mostly the latter. So we should fix that because there is no sane human being that could look at any of this information and think that we are well run. We are completely, completely out of our minds. So you and Jensen and a whole bunch of others have said, I'm staying, I'm paying, And you have a number of other friends that you know who have a very different view. They've either already gotten out or want to get out. You don't really believe it's going to happen, though.

32:10And you're hoping cooler heads prevail on this. Yeah. What's that conversation like? You know, there is a there is a period where I definitely thought about it. And I went around. I look at different places. And I thought, wait a minute. California is incredible. Palo Alto is incredible. It's given me everything. and I just said, okay, mentally, here's the number and just allocate it and just let's move on with our lives and get back to building things that I think are important. The reason why people are angry, it's the same reason they were angry in 1890. It's the same reason they were angry in Europe in 1930 at the beginning.

32:43It's the same reason after 2008, we've had all of this pushback. It's the same reason. So at some point, we should just fix the core problem that everybody is shouting about as opposed to allowing these other people to pervert the frustration they have into these dumb ideas and programs that are always about, give me more money and I will solve your problems. It just doesn't work. So what do you see as then the core problem? The core problem is there is a large number of people that look and believe that the ladder has been pulled up above them. Why do they believe that right now? I think very specifically technology has had this profoundly positive impact, but very, very few of us participated in it in the way that we all think that we've made it better for everybody.

33:30Looking at Instagram reels does not make your life better. That's not true. Being able to have a functional search is useful, but it doesn't necessarily make your life better. So we have to answer the question, how does this economically benefit more people? And I actually think this moment, you know, the different question, why did I, after 25 years of working, decide to actually get back in the seat and run a business? It's because this is the moment that I think actually has a chance to address the core root cause of what these people are saying, which is legitimate. The problem is the symptoms.

34:05And then the people that take advantage of those systems are winning. And I find that really concerning. OK, we're going to do 5 % of your it's going to be a wealth tax for you. Do you care that you're going to be out that 5 %? Do you care that what it's supposed to be doing for the people that you're talking about right now? Very unlikely it's going to have any effect on them. And they're going to piss it away. It will not have an effect. It will be completely. It won't help the people. Right. But you're OK with that. They're going to do it to me. I don't need it. But I know it's not going to help the people.

34:40I'm not OK with it. But what I am saying is this moment is very unique in the sense that we have the level of bottoms up awareness that we can create, whether it's X or whether it's the Nick Shirley's of the world, whether it's you who's been very consistent, whether it's me. I think that this is a moment where if you go and you raise all of this money, every single dollar will be traced, every single one. And the reason is because it's not how it affects the richest 0.001%. The reality in California is the overwhelming majority of the taxes are paid by people making less than$150 ,000. That is where they are going to go next.

35:18It is completely undeniable. And I think that we have to have a bulwark against that. And so, you know what, you want to take a piece of flesh? Fine, take it. But I think that there's a lot of us that will follow those dollars like Inspector Clouseau with a microscope. Well, we haven't up to this point. We're finding out now about leering centers and all this stuff and Medicaid. Yeah, but now it's up for people to act. But the reason why people will not act right now is there's still more anger towards a small number of people that are winning. And I think we need to address that problem.

35:51California's Billionaire Tax Act. Timoth is here. We're talking about we'll go to voters in November. He's going to stay. But the wealthy and their accountants. Ah, that's why you're staying are already finding out ways to reduce. Robert Frank joins us now with more. Hey, Robert, we have an actual California billionaire to talk to about this. That's because the ballot measure. This is a one time five percent tax on total net worth over a billion dollars. Accountants are looking right now at three main possible workarounds. So first, charitable gifts. That could be a good thing. Many tech founders are looking into gifting unvested shares to lower their total net worth.

36:27Others are accelerating gifts to donor advised funds and other charities. Real estate held personally is also exempt. So some people are buying property or transferring real estate from their companies or their LLCs to their personal balance sheets or revocable trusts. And certain assets held outside the state won't count against net worth. So they can buy art, planes, boats, vacation homes in other states or even other countries. That won't count against their total net worth. Now, also, states cannot tax treasuries. So some private banks are advising California clients to move a portion of their liquid investments into treasuries for a year.

37:07Now, proponents say all of this will raise over$100 billion in revenue from the tax. Other studies show it's going to raise far less and in fact cost the state up to$4.5 billion in lost revenue from billionaires who have already left. Now, we should say that the total billionaire wealth in California is about$2 trillion. Six people, most of whom have already left, account for more than half of that. So the question is, what's left? And then what will it raise? And then most California billionaires are between$1 and$2 billion. So they may minimize or avoid the tax through these other What was it?

37:44What do you think their contribution was? About two to three billion dollars a year in total income taxes, estimated income taxes paid by California billionaires. So that's what they currently pay. And you're going to say that. So you would. That's right. If now question for Chamath. Do you think Mark Zuckerberg has actually changed his residency to Florida? Oh, I have no idea. Yeah. Do you think we know that Sergey, that Larry Page definitely did. Sergey Brand probably did. Right. I don't want to comment on Larry and Sergey. But you said on your podcast that you know for a fact that a trillion dollars has already left.

38:29Look, there's a lot of my friends. I'm not going to name who they are because I don't think it's appropriate. But yeah, a lot of my friends have left. You think it's a trillion dollars? I mean, it's in the neighborhood. Do you think this is going to. But look, it doesn't matter what that number is. And I'll tell you why. The real thing that is going to happen from here is every single kid that goes and starts a YC company is not going to do it in California. They're going to leave. Then there are going to be companies like Paramount who are just saying, you know what, enough's enough. Because, again, this is not a billionaire.

39:02That's a very optimistic founder if they think they're going to get to a billion dollars. This is not a, not really. I mean, these valuations happen all the time. the problem with the way that this thing is written is some kid who actually has a little bit of success and is able to raise at a huge up round, still has no money, all of a sudden is going to be given a$50 million bill. He may be only making$100 ,000 a year. This is why this law is so dumb. It's just a way of opening the door to go after other people. So the billionaires will be able to sue. There's going to be issues of standing. There's going to be issues of tax.

39:35This will take 15 years to meander through the courts at the state and the federal level. So the state of California will accomplish nothing. But in that meantime, they will hollow out the builders and the makers. And then separately, all the upcoming builders and makers will say, on the margins, I'd rather be anywhere else but here. And then separately, I don't know if you guys saw this, but there was this incredible A-B study. This was Florida versus Illinois. And it's almost the same like for like, where you look at the same kind of estate, the same kind of revenue, and completely different outcomes.

40:09And Florida has obviously done so much better than Illinois. And the question is, these policies don't work. So more of the same will result in more of the same. And I think California will at some point be faced with some sort of quasi-bankrupt moment. and then it'll be up to the federal government to decide what do I ask for if I'm going to bail out the state of California? Because California technically can't go bankrupt. So all of those bonds, all the muni bonds, all of that stuff, what will the lenders ask for? That's the real question. And I think the way that that state is governed today doesn't work.

40:48People have been saying that about California and New York for years. They're overtaxed, overregulated, they're dying. In fact, we're seeing California tax revenues adjusted up because of this huge technology boom. New York, the same because of the financial boom. We haven't seen an impact yet from these high taxes. You haven't seen it yet. You think we will? Well, I think the reality is that most people will optimize for their own earnings. Here's the thing. I think Joe Lonsdale said this on CNBC, which I thought was a wonderful point. If I could give 95 % of my wealth away and I knew that all of these problems would be solved, I'd do it.

41:27It's fine. It's not a big deal. The problem nobody wants to give even 10 % or 15 % away is because we know that it's a joke. It doesn't work. They're terrible at what they do. They should not have these jobs. They should be fired. If there was a for-profit company, you'd fire all of these people. That is the problem. The policies do not make any sense. They are totally ineffective. that they're about their own power and their own influence. And to that, I would say, that's completely accepted in capitalism. Go and start a for-profit company. I got to talk to you after this. We're coming right back.

42:02More with Chamath right after this break. Still to come, he says AI is the great leveler, but Silicon Valley simply has an AI marketing problem. It is the thing that allows you to concentrate all this intellectual horsepower into this little magic box and give it to every single human on earth and say, I will help you fulfill your ambition. SquawkPod with Chemov Palihapitiya continues in a moment. Trading at Schwab is now powered by Ameritrade. Unlocking the power of Thinkorswim, the award-winning trading platforms loaded with features that let you dive deeper into the market. Visualize your trades in a new light on Thinkorswim Desktop with robust charting and analysis tools.

42:43All while you uncover new opportunities with up-to-the-minute market news and insights. Thinkorswim is available on desktop, web, and mobile to meet you where you are. It's built by the trading-obsessed to help you trade brilliantly. Learn more at schwab.com slash trading. Thursday, July 16th, CNBC Sport and Boardroom join Fanatics Fest for Game Plan. Groundbreaking ideas shaping the future of sports and entertainment. Request your invite at CNBCEvents.com slash game plan.

43:16You are listening to Squawk Pod from CNBC today with Joe Kernan and Andrew Ross Sorkin. I want to get back to our special guest this morning, Chamath Paliha-Patiha, founder and CEO of Social Capital, CEO of 8090, host of the All In Podcast. We were having a bit of a political conversation about what was taking place in California. I'm curious what you think more broadly about what's taking place in the country here in New York. Of course, we have our own mayor who's clearly clearly on the left as a Democratic socialist. How do you think about that right now? I think that this has been a failed ideology for hundreds and hundreds of years.

44:00It's never worked. It never will work now. It will never work in the future. But the reason these folks are able to coalesce power is that they're able to breathe life into the ability of pointing a finger at some group and organizing people's frustration and anger. And I think it's just important to go back and fix that issue. So, you know, if you ask me, I'm really concerned about the growing anti-Semitism. I think that that is completely unacceptable, 100 trillion thousand percent unacceptable. The pointing to billionaires, it's actually not even pointing to billionaires. It's specifically pointing to tech folks.

44:43Because, you know, if you said you made a billion dollars in pig farming, nobody would care. And you'd say, God bless you, go off and, you know, go with God. So specifically around how tech people have coalesced power in a way that I think frustrates a lot of people. And then now you have the growing scourge of big government, which is like, give me more. I will take more. I will give you UBI. I will solve all of your problems. They never do. It's never worked. So you have to fix it. And so you see it in New York. You see it in California. How much do you think it is about the concentration of wealth?

45:16Because that is a real issue. I think it is a real issue. And so how do you break that concentration? That's sort of the question. Well, I think the way that I think about this problem is you've always had infinite human ambition. And what you actually saw was that capability met ambition. So I think the real question is everybody is capable of taking care of their own selves and having a decent life and taking care of their family and doing all of these very important things. The question is, have they been blocked somehow or said differently? Is there an unblock? Is there an unlock? And this is where I think we have done a horrible job in Silicon Valley with AI, because AI is that great leveler.

45:56It is the thing that allows you to concentrate all this intellectual horsepower into this little magic box and give it to every single human on Earth and say, I will help you fulfill your ambition. So are you in the Jeff Bezos camp that says there's ultimately going to be a lot more jobs? Yeah, there's going to be a lot more jobs. You don't believe that there's, when we talk to Tom and say, but maybe you won't be able to be an actor anymore. These are very specific and nuanced arguments. One is a specific kind of a job will not exist. The different argument is, but many other kinds of jobs that are harder to name right now will exist.

46:31And I think if you look through history, the answer has been that the latter has always been true. You know, there's a great example that Jeff Katzenberg, Jeffrey Katzenberg tells about this exact thing related to like making movies with Pixar. When he went down there and did a deal with Steve Jobs. When he went back to Disney to get that deal done, people in Disney were up in arms because they said, you know, the animators wanted, you know, Jeffrey's head on a stake. But it turned out they got the deal done. And then it turned out 10 years later, there was 10 times more animators at Disney. That's one example.

47:03Vinod Khosla famously said radiologists were going to disappear. Lo and behold, five years later, there are like umpteen more radiologists because it turns out the taste and judgment of those doctors mattered even more. So I suspect we're going to look back and you're going to find that AI actually creates a lot more opportunity, but there's going to be dislocations for sure. The problem is we don't tell that story. Right now we're still in this like navel gazing part of just like underwriting our own book. If we need to raise money, we're going to prognosticate about the digital God. If we are done raising money, we're going to try to pull up the ladder by getting regulatory capture.

47:38That's the cycle we're in. So we should just call it that. It's never different this time, but I think this time it's different this time. This is qualitatively different. You don't have to be a stupid Luddite to try to not want I don't know, whatever that was, the weaving machine that they were designing. This looks... How can this AI movie not possibly displace a lot of Hollywood? You think everybody becomes a creative writer or something? truckers. How can autonomous trucks not displace all the truckers? I looked at this trucking example recently, and it turned out that after all of these years of Uber cannibalizing the driving market, the number of chauffeur drivers are actually 2x more than when they were when Uber entered the market.

48:26How does that make sense? And I think the thing is that there is this nature of humanity, which is that we're very entropic. Like it just kind of expands as a gas. And we generate more GDP every year, right? We consume more things every year. Now, people may have an issue with that. But the point is that we are, as a species, creative, ambitious. We make things, and then we consume more and more things, which requires more and more people to do more and more things. And if all of a sudden this ends because you stop having emotions and an ego and need to eat and need to sleep, okay, maybe. But I suspect that most of our lives are going to be roughly the same, but we're going to have this, like the way that I think about it, like, you know, what is 80-90?

49:09I want to build everybody a digital co-founder. I want you, Andrew Ross Sorkin, to have in your pocket a super co-founder, a person that when it comes time to helping you, unambiguously helps you with anything and everything related to you being able to be happy, fulfilled, have an economic life and sustain yourself. You could build a one-person company like that guy. You could build a 50-person company. But right now, you can't do most of those things. Because if you have the idea, there's a huge gap, right? Ambition tends to be infinite. But human capability is finite. And I think that AI will allow you to democratize that.

49:44That's a big deal. I hope you're right. Now, the problem is we have people that are like, you know, prognosticating doom and gloom. And they're the people on the inside of the tent, which I find very troublesome. It bothers me deeply. You're talking about these sort of AI doomers. It comes from our own camp. It's our own side. So but what's that about that? Explain to me why a Sam or a Dario has gone to Washington and said, look, this stuff is dangerous. This stuff could mean that we have half the jobs that we thought we had. Are they doing that to protect themselves? Do they actually believe it?

50:14What do you what are you suggesting is happening? I think that they legitimately believe it. And I don't think Sam is as much as as Dario. Dario is much more of this kind of like he is very deeply afraid. I think Sam has toned down that rhetoric a lot. And I think Sam has much more been, you know, if the glass is half full, especially in the last year, why are they doing it? Honestly, I think at some level they believe it, but they've just been wrong consistently. And I think they're going to continue to say it. And at some point we have to say, okay, hold on. Maybe underneath this, what's really happening is an opportunity to create a monopoly or a duopoly or an oligopoly.

50:51That's the natural reaction of all the rest of us. Let's not do that. Let's not do that. Let him scream in the sandbox about how the sky is falling. Let him do it. What I and many other people will tell you, after decades of being in this industry, the sky is not falling. All right. All right. Well, we'll have more to come from you. You used to tell me we're all going to die from climate change. And hopefully you don't think that you're right i was wrong i'll admit it i love right i was wrong oh i love you you said i was 100 right on climate change you're 100 right on climate change what about trump why you're 100 right on trump you he's fantastic great person unbelievable person very smart on top of it open-minded great president great president so far yeah You think you got bad mail from the SPAC stuff?

51:45What's your Twitter account? Well, I look, I actually look. The TDS you can cut. You know what's so funny? I mean, like, people can be lazy and reductive. There's enough people that I hear that are lazy and reductive. And they're going to end up where they're supposed to end up, in a little cul-de-sac of their own making. The reality is that most of us were lied to by the media about President Trump. And if you just go back to the source material, you should take away two things. One, he didn't say half the things he said. And two, why did these other people just fabricate what they wanted to say so that they could essentially assassinate his character?

52:19I think that that second thing is completely unacceptable in America. And there's still been no repercussions, really. I took the time to learn about it. I admitted where, you know, the way that I met him was I admitted on the pod, which, you know, has millions of viewers. And I said, I got it totally wrong because I went and I watched Charlottesville. And you know the first person to call me? Who was it? President Trump. And I got to know him, and I put the phone down. I called my wife, and I said, we got it totally, totally wrong. We were lied to. And then I got to know him, and he is fantastic.

52:54Okay, let me ask you a different question. There are going to be people who are watching who are going to say, who are on the other side of this. If you were going to be critical. Just people watching? What? You have to, as a human adult. Just people that are watching. My question to you is, if you were going to be. Some people say. It's not as some people say. OK, go ahead. No, no. Look, by the way, I find the president very charismatic. So this is not a personal life is dealing every day with. But I'm asking a different question. I'm asking a question. If you were to if you were to look at this president and say the things you disagree with the president about or that you.

53:27What would they be?

53:32um i thought the some of the the ways in which some of the cuts were done in certain organizations was probably not ideal i think it was a little too chaotic in the end i think doge made a ton of sense but i think there was too much glass broken um you know just i'll give you a simple example of this but um we just published something this morning we meaning 80 90 we worked with cms and we took a 50-year-old system. This is the core system. It processes half a trillion dollars a year of healthcare payments for Americans. Nobody knew the system end to end. And they put us and Palantir in a sandbox and said, can you help us decode what's going on?

54:14And in 40 days, we, 80, 90, produced the 500 ,000 rules that process half a trillion dollars of healthcare payments so that that team could figure out what's going on. Where's the fraud? Where's not the fraud? There are all these things that were possible. It took a little bit longer because it was a little chaotic. That's an example. Second example, maybe the way in which we funded the research budgets of universities, I didn't particularly like that as much. But on the broad-based things that he did, I think that he has been way more right than wrong. Where do you land on the war? Can you just say one more thing?

54:46The war in Iran. The most important thing that got me to see his point of view is he was completely binary on there cannot be nuclear war. When you have a madman country that is attempting to destabilize the ability for all of us just to live our lives, I think he was pulled into a situation he didn't want to be in because he believed strongly in no nuclear weapons. I support that because I think everybody is forgetting the chaos that that kind of thing can create in the world. Now, can I just say something else? You're allowed to disagree with the guy. You're allowed to maybe dislike the guy.

55:23But as an adult living human being that's responsible for taking care of your family, you have to get past the TDS. See where he's right. See where he's wrong. But the TDS thing that's stopping people from making a savings account for their children. Right. That can give them free money. It is insane. Because we only got a couple minutes, I want to talk about SpaceX. Yeah. Because you were an early investor in SpaceX. I mean, so I was an investor in Peter Thiel's fund. That was my first exposure to SpaceX, which I didn't even realize. So I think the big question now is it's a publicly traded company.

56:00Yeah. How big the TAM really is, how quickly or not. I mean, there's a big debate still about this idea of data centers in space and what that ultimately looks like. Like there's potential competition. There's the idea that he may want to merge or buy Tesla. How do you see all of this? Yeah, OK. So I think it's an incredible company. And we should say you own shares of the company. Yeah, I was an LP and Peter's Founders Fund 2, which may be the single best venture fund or any fund of all time. It's literally like the outlier of outliers. It's like a multi-hundred approaching thousand X return, his fund.

56:38And then 2011, I invested. And then 2016, he acquired a company where I was a large investor in called Swarm, which is their direct-to-sell business. So I really believe in Elon. I believe in SpaceX. What is the interesting thing that I think is worth taking away? I think that people are probably underestimating the short-term value of two things. One is the industrial logic of acquiring Tesla. There is a very obvious industrial logic to put these two businesses together, to have one capital structure. to have one balance sheet to be able to raise money for the broad swath of things that he's doing as one vehicle.

57:15And then the second is, I think that you're going to see an enormous business in the domestic cellular market before you see a lot of other revenue streams hit. What do I mean specifically? The spectrum he bought from Charlie Ergen, I think is going to get lit up. This is just me speculating. I think Elon's going to have some sort of a phone device. I think he's going to You think he's going to have a phone device itself or that he's going to be partnering with an Apple and a Samsung and others and he's going to put transponders in, but he's going to need transponders in all these big cities. I think it makes much more sense for him with the prevalence of Starlink to go direct to sell and go to consumers and say, I gave you internet access.

57:56I would like to give you an incredible new mobile phone service. It's integrated with all of these other services that you need? Would you like it? From AI to payments to how your car works, all of it. And I think that there will be some plurality, tens of millions of people all around the world that will pay him incrementally for that. I think that is what's being slept on. That is the key asset. When I saw him do that deal with Charlie, I thought, oh my God, here it comes. That is the Let me ask you, to me, the big question on Starlink in this regard is the multiple on an AT &T or Verizon or T-Mobile or frankly, even globally, any of those players is materially lower than the multiple that he has currently.

58:40Now, maybe you could argue the multiple comes down, the earnings go up, and somehow they meet in the middle. But what do you think? I think that the multiples of free cash flow of all these public companies are going to come way in. I think that as AI becomes more prolific and powerful, I don't think you can have PEs, price to earnings ratios, that all of a sudden think about 20 years of cash flow streams. I just don't think that's possible. Why? Because a competitor with a reasonable barrel of oil, right, starting with how we started, of intelligence, will be able to compete with you. And so the market will probably move all of these companies to being worth some multiple of the first five to seven years only.

59:20So I think what's happened is that when you look at SpaceX, it has all of the infrastructure plus its own AI. If you look at the mobile carriers, they're missing a lot. I'm making you an independent director of Tesla for a moment. How much does SpaceX have to pay for Tesla for the independent board to say this is a fair deal, given the various incentives and power that lies in all of this? And Elon obviously is at the same. Great question. I think if you look at a traditionally trading business, it's probably a 20 % to 30 % premium. But because of the volatility of Tesla and the number of shareholder lawsuits that may come up no matter what, I mean, if he eats a sandwich the wrong way, he unfortunately gets sued.

1:00:08So it's probably a 50 % premium. A 50 % premium. Yeah. Jamath Pali Hapiti, everybody. Love you guys. Go take a nap. We really enjoyed this. Come on back. This was a lot of fun. Thank you for doing this with us. Thanks, Joe. You said what? Once a quarter, I'll come up. Once a quarter. I don't come to New York. He's got to wake up early once a quarter. Once a quarter, he's got to wake up early. That's great. It's worth it. And that is Squawk Pod for today. Thanks to you for listening. Tomorrow on the podcast, Warren Buffett, the Oracle of Omaha with our Becky Quick. The 95-year-old Berkshire Hathaway chairman has announced his annual charitable stock giving, and he intends to donate all his Berkshire shares within the next eight years.

1:00:48We'll hear all about it tomorrow. Squawk Box is hosted by Joe Kernan, Becky Quick, and Andrew Ross Sorkin. Tune in weekday mornings on CNBC at 6 Eastern or get the best of our TV show right into your ears when you listen to Squawk Pod wherever you'd like to get your podcasts. Have a great day. We'll meet you right back here tomorrow.

1:01:16Trading at Schwab is now powered by Ameritrade, unlocking the power of Thinkorswim, the award-winning trading platforms loaded with features that let you dive deeper into the market. Visualize your trades in a new light on Thinkorswim Desktop with robust charting and analysis tools, all while you uncover new opportunities with up-to-the-minute market news and insights. Thinkorswim is available on desktop, web, and mobile to meet you where you are. It's built by the trading obsessed to help you trade brilliantly. Learn more at schwab.com slash trading.