Open-Sourcing Meta & Grand Theft Auto VI Pre-Orders 8/10/26

0:00Trading at Schwab is now powered by Ameritrade, bringing you an expanding library of education with even more ways to sharpen your trading skills. Access new online courses, insightful webcasts, articles, engaging videos, and more. All curated just for traders. Plus, guided learning paths with content designed to fit your unique interests. And no sifting to find exactly what you need, so you can spend your time learning to trade brilliantly. Learn more at schwab.com slash trading. Hey, Chicagoland, the Wayfair store is in your neighborhood at Edens Plaza and Wilmette. Finally, you can feel the fabric, sit on the sectionals, and even open the refrigerators.

0:36Plus, our in-store designers will help you bring it all together with free one-on-one design support for any project on any budget. Yep, we said free. Oh, and did we mention the cafe? So what are you waiting for? Come see all that's in store. Visit the Wayfair store today at Edens Plaza and Wilmette. Wayfair, every style, every home Bring in show music, please. Hi, I'm CNBC producer Katie Kramer. Today on Squawk Pod. The future of artificial intelligence from a giant in the tech industry, Vinod Khosla, billionaire entrepreneur, Sun Microsystems co-founder, and a new NFL owner on the big names writing the history of AI.

1:19Open AI and entropic aren't the end of this AI story. They're the big name. And I suspect we'll see massive expansion of the number of trillion dollar companies impacting fundamental areas of society. It's what gamers have been waiting for. But the Grand Theft Auto juggernaut is just another part of Take-Two's$40 billion plus content business. CEO Strauss Zelnick. All things Grand Theft Auto, the Grand Theft Auto franchise has been less than 15 percent of our total revenue. Plus, Meta's AI for All promises it paramount, and President Trump reignites his push to fire a Fed governor over mortgage paperwork.

1:59You don't want to defend somebody who has done something that is demonstrably wrong. You can defend the due process. But you should defend the due process. And then the question is, is this a form of due process? It's Monday, August 10th, 2026. Squawk Pod begins right now. Stand and or by in three, two, one, cue and or. Good morning. Welcome to Spockbox right here on CNBC on this Monday morning. We're live from the Nasdaq market site in Times Square. I'm Andrew Ross Sorkin, along with Melissa Lee. Joe and Becky are off today. Some news just out, and this is interesting, from Facebook's parent Meta, Mark Zuckerberg, laying out an essay with a vision for AI in a new piece.

2:42It's titled The Future is for Everyone, The Path to a Positive AI Future. Zuckerberg, saying he's hoping that invention rather than automation can serve as the primary purpose of AI. It's part of a larger theme he's been talking about and a lot of the folks in the AI world have been talking about. And he says that superintelligence is broadly distributed, or at least that's his hope, in order to empower everyday people. We've had obviously a lot of backlash. You've seen the booing at some of these commencement speeches and the like meta, though. And this is maybe the most interesting part about it, announcing a$1 billion fund aimed at investing in communities close to where the company operates data centers.

3:19So there's going to become a pool of money, and it will be called the Future is for Everyone fund. It will be focused, from what I understand, on policemen and firemen and members of these communities. Additionally, by the way, Meta announcing that the wait for its AI model called Muse Glimmer will be made open. It's a$30 billion parameter dense model. It says it will be able to run on a consumer laptop, so you'll be able just to get this open-weight model effectively for free. Put it on your laptop and go. Zuckerberg also appraising open-source AI, calling it an important force for empowering people and preventing centralization.

3:59So there's a couple of things to unpack here. Yes. One, Mark was very early, actually, on the whole idea of open-source, open-weight models with Llama from the beginning. Right. Right. And then seemed to pull back when when everybody seemed to be moving toward these closed source models and is now, I think, leaning in, you know, full on to the open open weight situation, which is just an interesting sort of watching the pulling and pushing of what's happening in the industry. I think what's key here is that this can run on a consumer laptop, an ordinary consumer GPU, as opposed to a lot of the other open source models which have been released, like a Kimmy K3 or.

4:38Which are massive. They're like the latest Alibaba's 2.4 trillion parameters, and this is 30 billion. But for a consumer, that's what you need. This drives the cost lower for the consumer, right? And so that's sort of. No, that's a huge, huge benefit. Huge step. The second piece is just both the change in language that I think a lot of people in the AI community in the past two or three months have sort of moved towards, which is how can we get people to believe this is actually a technology that is for them, that's going to better their lives, not take their jobs, and take their lives away from them?

5:15And then the last piece, which is interrelated to that, is police officers, firemen, members of communities that are now having these data centers, and there's all of this community pushback and backlash that we don't want in our backyard. And here they're saying, look, we're going to put a fund together that's going to be in addition to whatever we're going to be spending on the construction of these data centers to give back to these communities. By the way, this is a model that has been tried and true insofar as for many years, companies would live inside communities, they'd give philanthropy, they would do all sorts of things.

5:50They would build communities. They would build communities. And by the way, that actually stopped in the past 20 or 30 years. I mean, it really did shift away from the idea of we need to help the communities that we are actually in. It really just underscores how flat-footed the AI community was in terms of anticipating how they would be received by local communities and the different issues surrounding it, including higher energy costs. I mean, first you have Governor Hochul with the moratorium here, Governor Abbott in Texas. I see the Virginia governor stepping in on the proposed merger between Nextera and Dominion because of higher energy costs.

6:26I'm concerned that there would be higher energy costs because of this deal and because of the related data centers in the state of Virginia. So, you know, this really underscores the enormous amount of backlash these guys are facing. Well, Berkshire Hathaway profit rising last quarter. Operating earnings climbed 16 percent year over year on strength in the firm's energy, railroad and manufacturing businesses. Insurance was a weak spot. Underwriting earnings fell 13 % from a year ago. Key takeaway here, Berkshire CEO Greg Abel is starting to put cash amassed by Warren Buffett to work on buybacks and stock purchases.

6:59Berkshire bought back about$4.5 billion of its own stock during the second quarter, up from$235 million in the previous quarter. The company also reversed a recent pattern of selling stocks. It was a net buyer of equities with about$20 billion of purchases in the second quarter. Prior to that, Berkshire had sold stocks for 14 consecutive quarters. The closely followed cash pile fell by about$30 billion. Second quarter included the closing of the company's acquisition of home builder Taylor Morrison. And President Trump reviving his efforts to fire Fed Governor Lisa Cook. In a letter to Cook that was dated mid-last week, White House aide Dan Scavino saying that the president is considering removing Cook from the Fed's board of governors because there is, in the words of the letter, sufficient reason to believe that you made false statements on one or more mortgage agreements.

7:52Scavino asking Cook for a written response within three weeks. These are the same allegations that President Trump brought up when he first moved to fire Cook from the Fed last year. The Supreme Court, if you remember, backed Cook in June. But Chief Justice John Roberts said the court's decision didn't stop the president from trying to remove Cook as long as their constitutional due process rights were respected. And the concept here is that that is at least an effort to do such a thing. In a statement, an attorney for Cook telling CNBC the allegations against her are, quote, as baseless now as they were a year ago when President Trump tried to remove Governor Cook and interfere with the independence of the Federal Reserve.

8:33You know, interestingly, I was out in Aspen at the Aspen Economic Strategy Group's meeting last week, And there were a number of FOMC members there, as well as the former Treasuries, four or five former Treasury secretaries. And in the hallways, one of the conversations was going to be actually about, was about this issue and what would happen if the president went after Cook. Most interestingly, the question that they all had was, how would Kevin Walsh react? Right. In terms of the independence of the Federal Reserve, would he back Cook? Would he back Cook publicly? Would he say nothing? Would he walk her in?

9:14I don't know what the various permutations this could take. But in terms of these big questions about the independence of the Fed, what role and how would Kevin handle that particular question was something that clearly was on their minds. And this was even before. I think they must have had hints that something like this could come down. What did those former Fed folks say or should do to preserve Fed? Well, I think a lot of them and and just to just to put some context on it, people like Jay Powell were at this meeting. People like Hank Paulson were at this meeting. Janet Yellen was at this meeting.

9:52Steve Mnuchin was at this meeting. Tim Geithner was at this meeting. There was a whole bunch of people in that in that category. I think there was a sense that you needed to protect the independence of the Fed and therefore protecting Cook to some degree. I mean, I think there's still a question, and I think we don't know ultimately what happened and what Cook did explicitly. Or didn't do. Or didn't do. Right. And so, look, you don't want to defend somebody who has done something that is demonstrably wrong. You can defend the due process. But you should defend the due process. And then the question is, is this a form of due process or meaning send a letter?

10:34Is it does that is that work or not? Right. All good questions. We'll see, I guess, what worse says or doesn't say. Paramount Skydance reportedly ready to make some commitments to movie theater chains and its campaign to acquire Warner Brothers Discovery. Bloomberg reporting Paramount is willing to sign contracts with chains to release 30 films a year theatrically. if the Warner Brothers deal is approved. That would include exclusive movie theater rights for films for 45 days and no streaming for 90 days. The report says Paramount has offered three-year commitments to AMC and Regal Cinemas, and the company could face penalties if it were to break its word.

11:12The commitments are similar to public ones already made by Paramount CEO David Ellison, but this time they would be in writing. The question is whether this would be enough or sufficient to satisfy these state AGs. I think there's been a real question as to whether ultimately they would actually have to sell off pieces of the studio business, either big, big pieces of IP, parts of the DC comic world or the Dune world or something to a third party. And there have been examples of times where companies have been forced to effectively stand up a competitor, if you will. But it wouldn't surprise me if ultimately they were forced to find a way, maybe it's a combination of a private equity player, a Sony or an A24, some other kind of studio that would then become a bigger studio by taking some pieces.

12:09That might solve some of the AG's issues around the movie side of it. Then there's still the TV side of it. And whether on the linear end you'd want to get rid of a TBS, the conundrum on the cable side is the cable assets produce a lot of cash for them. And given the loan covenants, and there's a lot of debt in this deal, they almost need some of those assets simply to be kicking off cash to pay the loans. And so the question is how you'd actually make all that happen. It is amazing that this deal was consummated basically on the notion that this would go through faster. Right. Right. And here we are.

12:47That was the that was the conceit. Yeah. Yeah. Cheese will be next. Coming up on Squawk Pod, venture capitalist Vinod Khosla. He is backing a new startup derived from all of the AI staffing changes at Google. Google has a very deep bench of researchers, so I'm less worried about Google. They have so much strength and they have younger researchers who will get an opportunity to step up. The tech veteran on the big names in Silicon Valley, investing today and much more when we come back. Quince is all about fewer, better pieces. Their clothes are made with premium materials built to last and designed to become the ones you reach for day after day.

13:32Quince specializes in everyday staples that work harder, like their ultra soft organic cotton tees and premium Mongolian cashmere sweaters. They're versatile, timeless, and transition seamlessly from a casual workday to dinner out. Everything at Quince is priced 50 to 80 % less than similar brands. They work directly with ethical factories and cut out the middlemen, so you're paying for high quality, not brand markup. And it's not just apparel. Quince also brings that same everyday elevation to everything they offer, from hotel-quality bedding and bath to kitchen staples, essentials, and thoughtfully designed furniture.

14:06Upgrade your everyday. Download the Quince app for app-exclusive offers or go to quince.com slash squawk. Get free shipping on your order and 365-day returns. Now available in Canada and the UK, too. That's quince.com slash squawk. This episode is brought to you by Schwab Market Update, an original podcast from Charles Schwab. Join host Keith Lansford for this information-packed daily market preview delivered in 10 minutes or less, including projected stock updates, monetary policy decisions, and key results and statistics that may impact your trading. Download the latest episode and subscribe at schwab.com slash market update podcast, or find Schwab Market Update wherever you get your podcasts.

14:52Hey, Chicagoland, the Wayfair store is in your neighborhood at Edens Plaza and Wilmette. Finally, you can feel the fabric, sit on the sectionals, and even open the refrigerators. Plus, our in-store designers will help you bring it all together with free one-on-one design support for any project on any budget. Yep, we said free. Oh, and did we mention the cafe? So what are you waiting for? Come see all that's in store. Visit the Wayfair store today at Edens Plaza and Wilmette. Wayfair, every style, every home. You're listening to Squawk Pod from CNBC. Here's Andrew Ross Sorkin. Okay, we've got a great new guest on the program.

15:33We haven't seen him in quite a while, a tech pioneer who's backing a unique startup that he says could have a great impact, maybe even a greater impact than Google or OpenAI. Joining us right now is Knud Khosla, Khosla Ventures founder. Good morning to you, sir. Good morning. It's nice to see you. You did make a big investment. Well, you've made a lot of AI investments, but this AI investment from last week turning lots of heads, in part because there's a big impact potentially on Google. So maybe you can speak to it all. Well, it's a stellar team out of Google, a team you seldom get to invest in.

16:09It's an area of AI research that really accelerates both AI research and research in the sciences. So it has this huge potential to benefit humanity through accelerated science. What's not to like? Well, here's the question that I had, and I was thinking about this. You know, I would think that both Google and Anthropic and OpenAI are so ahead of everybody else. We keep talking about AGI and the singularity that if, in fact, they are that far ahead of everybody else, by the time that almost anybody starts something today, will they be able to catch up and do something that's genuinely unique? Well, we think so.

16:57I think in this particular area of accelerated scientific research, a great team like this can absolutely not only catch up, but get ahead of the curve. What do you think the impact on Google ultimately will be? We keep talking about some of these big names leaving the company. Well, I do think Google has a very deep bench of researchers, so I'm less worried about Google. They have so much strength and they have younger researchers who will get an opportunity to step up. So I'm still bullish on Google's ability to make progress in the AI area. But this is a unique team and absolutely the team that got them a long, long way.

17:44And so very excited about this particular one without it hurting Google in a significant way. What do you think more largely about the economics of what's taking place in the AI ecosystem right now? We have a potential anthropic IPO later this year. Obviously, big questions about what that valuation will look like, what the valuation of open AI will look like. There's conversations about circular financing. How do you see it right now? Well, as I look at the investment opportunities and we invest with a very long investment horizon. So when we invest, we expect seven to 10 years before getting any liquidity.

18:26In that time frame, many, many companies will be started now that are worth hundreds of billions and trillions of dollars. I think we are seeing the beginning of this. This is not the end of it. Open AI and Enthropic aren't the end of this AI story. They're the beginning. And I suspect we'll see massive expansion of the number of trillion dollar companies impacting fundamental areas of society. So still lots of opportunity to invest in new companies. What do you think, though, of sort of the data center ecosystem? We saw Mark Zuckerberg put out a fascinating essay this morning, but not just an essay about trying to make AI for people and these new open weight models, but also putting together a billion dollar fund effectively to try to pay communities, policemen, firemen and others to want to build data centers in their backyard.

19:25Something that's not happening right now in the state of New York and even in the state of Texas. Well, one, there's enough states that want this growth and investment. I am not too worried about data center investment. But I do think in general, it's a good idea to make sure that people aren't negatively impacted, their electricity rates don't go up. It's very easy for a hyperscaler to subsidize electricity for people in the communities where they're setting up data centers. So that's a good idea. Vinod, I also wanted to ask you about another notion within Mark's piece, and that is that everyone will have free or affordable access to AI tools.

20:09So he sees a world in which people should have access to these tools and in a world in which people want more compute power, that there will be a dynamic auction process to make sure the costs are as low as possible. If that comes to fruition, does that change the economics of how we are investing in AI and how these models are constructed in the subscription model that we have currently? No, it doesn't. And it doesn't because you can have an advertising model. OpenAI has a free chat GPT available, and Mark is well-versed in advertising models. So I think there will be a free model, and then there will be paid models.

20:48If I'm doing serious research, then I do want to go much deeper and spend a lot more money. So, you know, whether I want somebody to give me a search answer in five seconds or take 50 minutes or five hours to do research, it will result in a different kind of payment methods. And enterprises definitely will use paid services just as they have in traditional enterprise software. Vinod, what's your reaction been to the price of SpaceX and what that says either about, and look, there's so many component parts of that business. There's the AI piece, there's the data center piece, there's data centers in space, there's Starlink.

21:36I don't know where to begin. Starlink is a great asset. The space launch business is a great asset because space launch capacity is limited for the next five to seven years. We are invested in Rocket Lab. For full disclosure, I'm very, very bullish on Rocket Lab. And SpaceX is a good business. Starlink is a good business. I think data centers in space are yet to be proven. I'm somewhat on the skeptical side of it. The launch costs decline well below a few hundred dollars a kilogram. Why would one low price launch there if there's shortage of capacity? Further out, it may be possible to go much lower in cost, and many providers will do that.

22:26I have not looked at the economics of SpaceX, so couldn't comment on its valuation. OK, that's fair. And then we should talk about football. You've gotten involved in football. I see, by the way, there are people on Twitter asking you they want grass. They want real grass. And are you going to be managing whether you're going to be putting grass on the ground or are you going to be coaching, Managing? How's this all going to work? Look, the Seattle and Seahawks is a great franchise. And the 12s, which is their local fan brand, is one of the best brands in the NFL. And life sports will be the one area that will be insulated from any disruption AI causes.

23:08So it's a great investment area per se. As to grass or not, that's for management to decide, not for me to decide. Are you a huge football fan? How did this happen? I'm a huge football fan. Me and my son have gone to most NFL games in Bay Area, probably since he was four or five, maybe more than half the home games. And so it's a great opportunity to do a family thing and make an investment that's diversification away from AI and technology in general, which is sort of my ballywick. It was, and it's fun. It was like a nine and a half billion dollar hedge to your portfolio, if you know. It's a big hedge.

23:55How about the NBA, by the way? What do you think? Well, I've always enjoyed the NFL more than the NBA personally. Okay, so you're not going to be trying to buy a team. I'm not buying a team in the NBA. Okay. Look, life sports is a great area for investment insulated from AI disruption and technology disruption. So life sports is going to be a good area. Beyond that, it's what you have passion for. And NFL is what I have passion for. And a great brand like Seattle is a great franchise to buy. By the way, what do you make of what's happening in Seattle, though? Because there's a lot of business leaders that are very frustrated with what's happening in Seattle.

24:39A lot of business leaders frustrated in many cities, including San Francisco, California, billionaires tax. So society will have to sort this out. I do think we will need to do more for more people so they get the benefits of technology and AI progress and others. I do think that's a national issue, not a Seattle issue or a San Francisco issue. What do you think of the billionaire's tax in California these days, where things stand? I think it's a terrible idea. I floated an alternative, which I think is much, much better, which is also radical. In an op-ed in the Financial Times recently, I argued that capital gains and ordinary income should be taxed at the same range.

25:33There should be no difference because AI is giving capital an advantage, labor a disadvantage, and there's no reason to preferentially pay for capital gains. It really distributes income the wrong way to the rich people. 40 % of capital gains is paid by people making more than$10 million a year. I read that piece and my follow-up question to you, therefore, was going to be, what was the reaction that you got from your friends in the Valley? I don't care much about reactions. I care about what's right and what I think is the right solution. There is a real need to have a large sovereign fund to help people who might be displaced by AI.

26:20And this is one way to create it. $300 to$400 billion a year can be created at extra taxes by levelizing and making capital gains be the same as ordinary income. And that then has enough funds in a revenue-neutral way to take care of the people impacted by AI. I think that's the right solution. I want to try one out. Go ahead. But people making less than$75 ,000 a year should not pay any taxes. That's only$75 billion. And that should be very, very easy to do. And by the way, it's the same number of people impacted by that as voted for Trump,$75 million or so. Let me ask you a related question.

27:09I was going to try this out on you. And I know you have the$75 ,000 cap. And I know you want to equalize capital gains and income taxes at the same level. Obviously, one of the rationales for a lower capital gains tax is to incentivize investment. Is there under your plan a way to think about a two tiered model where maybe the first, I don't know, a couple hundred thousand dollars in capital gains on any given year might be at a lower rate. But anything over that gets taxed at the at the income level. Yes, in my op-ed, I do say gains on primary income or farms, sort of smaller gains, which every normal person has, should be exempt from this increase in capital gains tax.

27:56So what would the rate be there for? I mean, what would be the cap? Well, frankly, that can be much, much lower or zero. Vinod, it's a fascinating one and it's a longer conversation. We love having you on the broadcast and look forward to talking again very, very soon. Yes, much longer conversation. I hope some presidential candidate takes up my urging in the financial time stop. Thank you. Talk to you soon. Still to come on Squawk Pod, an interview with Take-Two Interactive CEO Strauss Zelnick. It's going to be a big autumn for video games. Grand Theft Auto 6 will finally hit consoles in November after being announced back in 2022.