World's No.1 Investing Expert: The Big Shift Is Coming And This Investment Could Be 15x in 5 Years! - Cathie Wood

33:23Oh, Elon. The Department of Government Efficiency called Doge. So teaming up with Trump to try and eliminate government waste. Now as an investor, you must not love that. Well, I have two. I have two points of view. Two points of view. You know, I have, I drive the Tesla on a go to America. And it was the first time ever on the last trip to America in January. I live in LA now. Well, where I'm driving my, you know, my cyber truck. It's the full self -driving. It's incredible. But it was the first time ever I thought, I could be attacked. So I probably shouldn't get a cyber truck. I should probably get something else because I had of all these reports of people being attacked.

34:05And so it was quite interesting to hear in the earnings report, which I listened to, that there's been this decline in revenue, in profitability, in vehicle sales growth, etc. In Q1 of this year, which I think even Elon in that, in that earnings call highlights is a consequence of him becoming political. Yes. I think that surprised him. So I have many thoughts about this. Our government has become so bloated, it is scary. And our indebtedness is growing. And if we want to remain the reserve currency of the world, we're at risk of losing it. And on our tail is the whole digital asset world, right?

34:51So government spending is taxation. It's either taxation that's going to happen immediately, or will happen in the future, or will happen through inflation, which is the most regressive tax at all. So I think his, the sentiment was right in terms of getting in there and seeing what technology can do for the government, which is really what's happening. I'm watching it in the FDA, how they're starting to use AI. It's phenomenal what's happening. So the question I usually get. So I'm very happy that half of the solution is understanding the problem. That someone is in there with that focus and determination.

35:39He of course has said he's stepping away this month as a matter of fact, to spend more time with his companies. Which you must be happy about. Well, of course I'm happy about it, but I have, with the exception of this political dynamic, I don't think that Elon, not being there on a day -to -day basis, is what has caused the problem in the first quarter. It was much more macro. We had a negative quarter in real GDP growth in the first quarter. So macro, which is hitting everyone, and the overlay of this political dynamic. The news cycle, thank goodness, moves fast. And so we'll be through that, I think.

36:23And by the way, there are news reports even this weekend saying those who were feeling about him, as it relates to Doge and one party, are having a change of heart. Because tax rates are going to come down, because we're being more disciplined on the government spending side. Elon's way of managing his companies is to attract the best and the brightest, not only scientists, engineers, but also business people. These are people who want to solve the hardest problems in the world. He sets a timeline that seems reasonable to him for milestones to occur. And he doesn't interfere unless they start missing those milestones or the timing of those milestones, then he gets involved.

37:26And that's where you hear, he'll go in and he'll just fire people wholesale. And get the program going again. And he's done that, certainly at Tesla. He's done that at all of his companies. And so he's really troubleshooter in chief. Once he understands and has set a strategy, he then becomes troubleshooter in chief. Have you met him? Oh yes, we did actually. Our first podcast with him was in 2019. I saw that one. During production hell. And we were so happy. So as you know, we have a social strategy. So we push our research out through social media as we give it away. Or as we're evolving it.

38:12And he liked a piece of research that Tasha Keene had put out on autonomous back then. And I was on a phone call. I couldn't get off. But I heard this whooping and screaming through the office. And I thought it sounded good. It wasn't an emergency. So I didn't have to leave that call. But I got out. I said, what happened? Elon and I said, OK, ask him if we can do a podcast. And we were there the next week. Incredible. Yeah. What do you think of him as an entrepreneur? I think he's the Thomas Edison of our age in terms of, in terms of his innovative ingenuity. And I also think having met him a number of times.

39:01I think he's a very good person. He wants to do the right thing. If I had to say one thing, he wants to do the right thing to transform the lot of most of humanity. And he started with Tesla, SpaceX and Tesla. Tesla, you know, was an environmental move, which I think a lot of people attacking his cars, who are probably very supportive of the environmental movement, they've forgotten. And sending a rocket to Mars with humanoid robots and ultimately people, he thinks we'll transform life on Earth as well, because as we've learned from space history, what we learn about material science and technologies that help us break through into these very difficult problems to solve.

40:09And so, I think he's a very good person and wants to do the right thing. If I had to describe him, that's what I say, other than genius of our time. After Wunder, you know, because he's had such profound impact on the world in many, many ways through the companies he started. I think the biggest risk, really, is just his own health. It doesn't seem to sleep much. He says that he does sleep. I think he recommends, I think, if I'm right on this, getting seven hours sleep a night. And yes, but when he is focused, you know it. I mean, people even look, there were many pictures of him, whether it was standing with other policy makers, and then he zones into something, and you know he's zoned in.

41:03And thinking about only that, and a problem that he wants to solve. You've invested just over two billion in Tesla. Let's see. So it would be roughly, yes. In that region. Bitcoin. You invested in Bitcoin very, very early. What was the first price that you bought Bitcoin for? I think it was 2015. Yes, it was in the summer of 2015. We got in at roughly $250. Today it's $104 ,000, I think, roughly. So we did get in very early. And we knew we were on to something really when people were making fun of us saying, okay, that's a marketing trick. You're new to our business and you know, new to our, to the new fund world.

41:55And you're trying to track attention. And we were thinking, wow, they have no idea how much research we've done on this. And Art Laffer, my professor again from USC, we had him, we had him read our first white paper on Bitcoin. Bitcoin could it serve the three roles of money? So means of exchange, what we use every day to buy things, store a value like gold. And unit of account, would prices be quoted in terms of Bitcoin? Chris Brinisky was our first analyst on Bitcoin, wrote the paper, art read it, and you know, added to it enormously in terms of economic theory, which was great for us. And then he said to us, he said, this is what I've been waiting for, since the U .S.

42:54closed the gold window in 1971. A rules based global monetary system like Bretton Woods under the gold exchange standard. And I said, art, that's a very big idea. How big is it? And he said, well, how big is the monetary base of the U .S.? Back then it was 4 .5 trillion. And Bitcoin's market cap or network value was 6 billion. And I said, okay, that's a very big idea. And we were trying to get it into our portfolios. Regulators were hesitant, but I bought it right then for myself and haven't sold it. And I'm very happy with it. You would have yourself personally. We couldn't buy it $250. So we couldn't buy it back then, but we finally got through the regulatory process.

43:57And we were able to put the New York Stock Exchange said, okay, you can put a 1 % position in the portfolio. And it was of a grant or trust called GBTC. So we did. And we just never sold it. They didn't tell us we had to keep it at 1%. Oh, it's risen to be more than that. Yes, it ballooned. And what is it about Bitcoin that you believe was and is still a good investment opportunity for the average person? Yes. So at this price, it's about a $2 trillion market cap. And so halfway to that original $4 .5 trillion, but our price target actually has expanded since then. Because it's not just a global monetary system.

44:51It is a new asset class. And that's a very big idea as well. What makes a new asset class? And we haven't had one truly since equities in the 1600s. When you say a new asset class, you mean a completely new category of funding companies? Yes. Right? So an asset class would be something like technologies and asset class, right? No, it would be like stocks, bonds, commodities, real estate. This is a new asset class. And most people will agree with that. We did a study on it. If this asset does not perform like other assets, in other words, it provides diversification for funds. And because it is behaving differently, institutions have to consider it.

45:48Because they're competing against each other. And if one puts it in, they all know they're competing against each other. So others have to consider it. And we believe that part of the opportunity has not been tapped. And just to put some numbers on this, right now, we're approaching 20 million Bitcoin outstanding. Which means? The number of Bitcoin that have been minted over time by Bitcoin miners. So there's 21 million in total, right? There will be at the end of the minting process, 21 million. So we have only one million to go. Yeah. One million would be, what is that? That would be a hundred billion dollars worth, a little more than that right now.

46:46So just for someone I don't know much about Bitcoin. Bitcoin is mined using computers. And so far, they've mined 20 million of them. And there's one million of them left to mine. So institutions really just started considering Bitcoin. Because the SEC gave the green light to Bitcoin with the approval of the spot Bitcoin ETF in January of last year. And it takes a while for institutions to do their research and commit. And so they're just now committing. And there's only a hundred billion dollars of new market cap that is going to be created, whereas they have trillions of dollars under management.

47:40And so we think there will be a lot of incremental demand. And to satisfy a lot of that demand, someone's going to have to sell. Which means the price goes up. Which, yeah, if people don't want to sell, because Bitcoin's been awfully good. And our forecast right now, it's right now that Bitcoin's around 100, 105 ,000. Our forecast for 2030 is 1 .5 million dollars. And we do that. The building blocks for that, the three biggest building blocks are institutional, which has barely started. Stora value or digital gold. Young people are much more comfortable with digital gold than gold. So on the institutional side, that means institutions, investment institutions start investing in it.

48:45Young people start investing in it as a way to save and store their money. Yes. Yes. And then the very important use case that many people do not discuss is how important Bitcoin and stablecoins, which are backed by US Treasuries, are going to become to the emerging markets. In emerging markets, many of them are at the whim of policymakers who show no discipline. In fiscal or monetary policy. And so they're used to going through booms and busts and booms and bailed out by the IMF. And they need an insurance policy. So if you're in Venezuela, you need a currency that's going to be stable. Exactly.

49:37Well, this Bitcoin is, so stablecoins are stable vis -a -vis the dollar. Bitcoin is more of an investment because it does appreciate over time. Now you go through, it's volatile, no question. And that's the first thing people have to know about it. But it is becoming less volatile as more and more investors hold it. So you think Bitcoin will potentially multiply and value by 15 times in the next five years? Wow, that'd be pretty crazy. It's a very big idea because it is a new asset class. It does represent a global monetary system unlike any other digital asset out there. It is backed by the largest computer network in the world.

50:32The layer one, which is the base layer, has not been hacked. Think about that. Since 2009, when it was released, not been hacked. How many systems can say that? And it is a technology. It is native to the internet. And again, digital assets or any Bitcoin, Ether, Solana, all of them exist because they're vying to be the native currencies to the internet. And to enable smart contracts and really transform the financial services industry. Why did you invest in Coinbase? Coinbase is an exchange for digital assets and increasingly derivatives. It has gone global. It just bought Deribit, which is the largest options exchange out there.

51:42And it owns the futures. So it's really going after the derivatives market where there's a huge amount of activity, which is fantastic because it's all legitimizing digital assets. And it is the most regulatory, compliant exchange in the world. Binance is another major exchange, but has had more run -ins with regulators around the world and really hasn't been allowed into the United States. It also wants to become part of the new payments infrastructure. And so is evolving strategies that way as well. We've gotten to know management very well. They fought the fight against regulators in a magnificent way.

52:30And they have educated policy makers, importantly, who understand that this innovation, we almost lost this innovation to the rest of the world because of our regulatory stance. They've helped policymakers understand that, hey, this infrastructure is what developers did not build into the internet in the early 90s because they didn't know finance or commerce would take place. That's all this is. It's that simple, right? So if I'm trying to invest in just a summarizing, if I'm trying to invest in AI, your key positions there and your key thoughts are companies like Tesla, I heard you invest in Twilio.

53:14We had invested in Twilio. They had a management turnover, so we moved away from that. But Palantir. Palantir. Palantir is a platform as a service company, which we think is not only going to help governance, move governments move into the digital age, like our defense department and now it's moving into other departments, but also these huge, huge enterprises because it's not forcing them to rip and replace anything. They'll build on top of whatever technology infrastructure is there and over time, just you serve the role of the legacy technologies. So very important company we think in the digital age.

54:00It's had a very big run. We have taken profits and while it was having a big run, Nvidia was selling off. It was down more than 50%. So we put some of our Palantir proceeds back into Nvidia. Is there anything else in the AI bucket when you're thinking about it, stocks? Well, when you're thinking about chip companies in particular, TSM is the platform for chip manufacturing. It doesn't matter who wins. We do think there are going to be many more competitors to Nvidia, Nvidia still number one. Have you had about GROC? Oh, yes. GROC, we are invested in our private fund. Oh, okay. So just for people that might be confused.

54:50Do you mean GROC? Yes, that's in our private fund. We do own GROC. And that's a very important company on the inference side of the equation. I've invested in GROC as well. Yeah. It's probably a disclaimer. Well, I think you're going to do very well. So TSM, though, is where all the chip manufacturers go for production. It is the most sophisticated manufacturer of chips in the world. There is geopolitical risk there. Most of its business is in Taiwan. It is diversifying into, certainly into the US. And I think even into Europe. So I think that will continue to be a very important company as well.

55:37So what are you, what's your top 10 in terms of public stocks that anybody can invest in? If you had to give me your top 10. So I'd have to give you, and they're listed on our website. And I won't go in order. I'm sure. But of course, Tesla, Coinbase, Robinhood, Roku is an operating system for connected TVs. Highly misunderstood stock. CRISPR therapeutics, which is... Gene editing for sickle cell disease and beta thalassemia. Palantir, I think I've mentioned, in the AI software space. Archer just moved in to the top 10. It's the EV tall company, and it also signed a deal. An exclusive deal on both sides, which was quite impressive, with Anderall, which is Anderill, which is the most sophisticated defense tech play, and is growing like gangbusters.

56:45So that's terrific. Shopify, which is a shopping platform back end, and really using AI. Roblox? Oh, that's the one we're missing. Roblox. Roblox. Which is a game, right? Yes, it's a user -generated gaming company. And it's also a social platform. It started for children younger than 13 years old. And what's interesting about it is they've stayed with it, because 60 % of its user base now is above 13. Which is very interesting. It's the largest user -generated content provider out there. And what is fascinating about it is I know one of my friend's daughter has started her own dress shop on Roblox.

57:41And what she doesn't understand is that she's learning about business, but she's also learning how to code, especially in this new vibe coding world. So I think it's going to be a very important company going forward. The interesting thing about gaming and technology transitions is that it is the only entertainment medium that has not fallen apart with technology transitions. It has actually grown because those who love their games from 25 years ago still play them. It's grown with each technology revolution. So, and user -generated content in gaming is the next big thing. A business is only as good as the people inside it.

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1:00:13I will speak to you then. If you had a thousand dollars to invest and you had to invest it somewhere, where would you be investing it? Well. And how would you be like the general philosophy towards wealth creation at such a stage if you had a thousand dollars? How would you be thinking about creating wealth for yourself? A couple of things. Averaging into either an ETF. What's an ETF? ETF, exchange traded fund. So it treats a group of stocks like one stock. So ARKK is, it's nearly, it's 36 stocks. But you can buy them by purchasing ARKK. And you can do that on your mobile phone. You can do it on your mobile phone.

1:01:10A bunch of different apps allow you to just buy that one ETF which means you're in 35 stocks. Yes. And your team are basically choosing what those 35 stocks are based on your research. Right. And ARKK are our highest conviction stocks. And they offer an exposure to all of the innovation platforms that we've talked about. Whereas ARKI here in Europe is focused primarily on artificial intelligence and robotics. Because we think that convergence is going to be pretty explosive. What you don't get there and you do get in ARKK, we also have an another very focused fund, ARKG, which is really healthcare applications of AI.

1:02:04And another healthcare, other healthcare names that we think are going to be pretty transformative in the new world. As regulators really understand how important AI is going to become to discovery research, trials, development, to diagnostic tests and to curing disease. Another question popped up, which is about Ethereum and these other cryptocurrencies. Do you invest in any of these others? Yes, we have, we have, well, in our public funds, we've put them, I don't think we can own them here in the UK yet. But in the US, we have them in some of our funds, both of them. They're key to the financial services revolution.

1:02:52So to get people to understand and feel comfortable with that, we don't call it the crypto revolution. It's the digital assets revolution. And it's simply the Finternet, the financial internet. Okay, so that, so we do, we do. And do you believe, are you more bullish on the price potential of Bitcoin than Ethereum? Yes, we think Bitcoin is the biggest idea. It serves the three, three revolutions, global monetary system. They do not. New asset class, they are part of a new asset class, but Bitcoin is going to be the biggest. And new technology, it's the most secure blockchain technology out there.

1:03:34What about all these others, Salana and all these other? So, Ether and Salana, so the big three are the, are those are the big three. And we think they'll all be successful, all three of them. Bitcoin the most. We're very interested in stable coins, but that's just like cash. And you know, there are millions of crypto assets out there. We think most of them die. Is there any way to invest in stable coins? Like how do you invest in the same? I think directly right now it is through Coinbase, they have a deal with circle. Any, any revenue that circle generates, it's, it's, it's stable coin is US DC.

1:04:17Any revenue they split 50, 50 in US. Circle itself has announced that it is going public. And so we're looking forward to that. And what's, what's the sort of psychology or mentality one has to adopt to be a good investor? Depends what you've bought. If you buy a strategy like ours, which would be in the aggressive growth strategy, put it in, you know, averaging in over time, just like with Bitcoin, as I mentioned earlier, averaging in over time. What does averaging in mean? You know, buy a little every month, say maybe every payday. I think one of my daughters was buying Bitcoin every week, but not a Bitcoin.

1:05:02She couldn't do that. A Satoshi, you know, so, and close your eyes. Like you're, this is a long -term investment. If we're right, according to our analysis. Now you, this is our research, our analysis. No promises. We can't do that. But according to our research, the technologies around which we have centered our research, and which have focused our investments, they, we believe, will go up more than 10 fold in the next five to 10 years. And that's how much explosive growth we have ahead of us as these technologies converge and create incredible opportunities for investors. And, you know, I'm hearing a lot of invest, a lot of people, as they get into investing.

1:06:00Of course, they have their day jobs. But once they have accrued enough, you know, they're making choices about dialing down their day jobs and spending more time investing. You asked, what are some of the jobs of the future going to be? I think individual investors are going to be providing for themselves if they are investing on the right side of change. So if you're right, that means that by investing your fund, I'd make 1 ,000 % return roughly. Yes, no promises. But this is all based on research. And you can find it in our big ideas. Big ideas, 2025 is on our website, arc -invest .com. And you can find a lot more information about our funds on arc -funds .com.

1:06:52And I should probably say this is not investing advice. It is not. And I want to make sure you do your own research. You can lose all of your money. Yes. You can lose all of it if you decide to do any of these things. Yes. But that's why we put arc -invest separate from the fund site because that's just research. Learn. Learn what you're investing in. Or learn why we've invested the way we have. You know, that's what we do all day long. We try and help, well, first of all, we're doing the research. We are making the investments. But I think one of the most important things we do is communicate what we're doing and why we're doing it.

1:07:34What do you think of Trump tariffs? Everything that's going on in America at the moment? What's, you know, for the average person, should they be concerned? Are you bullish? Do you think Trump's got it right? If you look at what happened to the equity market, when Trump was elected. The stock market. Yes, the stock market. It went crazy to the upside as did our strategy. And why? The promise was deregulation. And that, I think, is underestimated how important it is because we're strangling in regulation. It's just, this is not our DNA. We've got to get out from under this. Lower taxes. Lower interest rates is what he wants, of course.

1:08:21And lower tariffs. What he didn't tell us was exactly how it was going to go about that process. And it has, it has felt chaotic. And I've had to go out and explain what's going on. Try to explain what's going on. And I have to tell you, it scared me silly to see what was going on. Because I knew that businesses were paralyzed and that we could have a mess on our hands. And I certainly communicated through my channels, art communicated through his channels. In fact, I think in one publication, he said, I have never been more scared in my career. And we were trying to really get into Trump's head.

1:09:19And I know President Trump listens to art. But he also listens to a lot of other people, one of whom was Peter Navarro, who seemed to have a hold on Trump when it came to tariffs. And yet, when I saw Treasury Secretary Besent really push aside Navarro, and that could only happen with Trump, I knew we were going to be okay. I knew we were going to be okay. Because throughout all of this chaos, I think what he is trying to do is not only get tariffs on the US down throughout the world, but maybe more important, get non -tariff trade barriers down. For example, I didn't even know the UK would not accept our beef or ethanol.

1:10:10Well, now you're accepting our beef and ethanol. I don't know if people in the supermarkets will buy it, but anyway, this one. But other countries, much, many, many more non -tariff trade barriers. And so he is just trying to bust that up. Make it more visible. For example, Canada, I think they charged a 250 % tariff on our milk. And one of President Trump's promises was to take care of the farmers. Okay? That's why you see the rhetoric around Canada. Now, do I agree with his style? I would never do it that way. I'd never do it that way. And it was unfathomable for me because he is sensitive to business, and he must have known that everything was going to stop.

1:11:08But he also knows that he has to sound crazy for other people to take him seriously. And people have to believe he will do crazy things, and other people to take him seriously. And he does do crazy things. So do you think it's going to work out? I do. And I think the stock market is beginning to smell it. If I just had to invest in one stock right now, what stock would you recommend I invested in? Okay. Well, I have to give you our... You will probably... So it would be Tesla. It would be Tesla if I had to give you one stock. Okay. Interesting. Because think about it. It is a convergence among three of our major platforms.

1:11:53So robots, energy storage, AI. And it's not stopping with robotaxies. There's a story beyond that with humanoid robots. And our $2 ,600 number has nothing for humanoid robots. We just thought it'd be an investment period and... You know, the... But I think he's going to start generating not only productivity gains internally, but revenues from humanoid robots. What are you concerned about in terms of the way that the world is going and everything that's happening? What are the things that keep you up at night? I've got many of concerns. So I've got many unanswered questions and worries about how things might play out, but keen to use.

1:12:35I am such an optimist. I really do have to dig down deeply. If you had asked me this a few weeks ago, I would have said, you know, this tariff situation is going to blow the global economy up if we're not careful. So I'm much more settled about that right now. I'd have to say I am concerned that there are going to be people caught out by these new technologies. And for whatever reason, not willing to adapt, because they're going to be huge opportunities if they do. And so one of the reasons we give away our research, you know, I'm very honored to do a podcast like this, is to get that word out.

1:13:21There is so much information available. You can just go to our site and listen to our podcasts. And if anything inspires you, go for it, because it's going... The opportunities are going to be enormous. When you say you're concerned people might get caught out. Caught out in disrupted industries. I mean, we think the whole transportation industry is going to be disrupted. We think retail as we know it's going to be disrupted as we... Retailers in like shops and stuff. Yes, although if they adapt with more social personal experiences, I think that anything physical, you'll want to have a social dynamic associated with it.

1:14:07But in terms of what I think is going to happen to retail, is we're going to have our personal shopping assistance. And they're going to... They're going to anticipate what we want, which I can't wait. I hate shopping. Anticipate what we want. Or basically flag something that they know we would like if we knew it were available. And they'll be disintermediating all of the traditional sources, because they can go anywhere in the world. So just think about almost every sector is going to be disrupted. Healthcare is going to be disrupted enormously, I think. For the better, for the better. But those who are wedded to doing things the old way are probably going to be disrupted, you know?

1:14:57Yeah, that is my concern as well. And just how we handle that as a society. But I think if we can help people understand that they have a lot of control over this, if they're willing to learn and dream, and use their imaginations. Not everybody is there, isn't it? Yes, but they have to do it for their children at least, right? We took the general population in the London and said, 100 people, how many of you understand what AI is? Or how many of you use chat GBT? We'd have a certain percentage, maybe I don't know, 50 % or more. If I went to the countryside. Yes. And I stopped a lovely person shopping in the local village and said, do you use chat GBT?

1:15:42It'd probably be significantly lower percentage. They wouldn't care about that. What is that? Whatever. I wonder about the inequality of education, but just initiative, and how those that really do have a proclivity to lean in and to experiment and to mess around and to learn, because maybe there's an incentive because they work in a city and their employees asking them to be off to the races with this disruptive technology. And there's just like a lot of the rest of society of middle America and the countryside and there's types of people who are just not even going to say it coming. But that's why we're out there.

1:16:20And the important word that you used was initiative, because I really think, when people hear the word inequality, they like to blame something, right? There will be no reason for this. I'm sure someone's going to come back at me for saying that, but of course there are people who we have to help along the way. No question about it. But for those who are healthy and are listening to this podcast and are saying, you know, I don't know exactly what she's talking about, but I'm going to start reading up on some of these new ways of doing things and make sure to at least understand it. I think within that kind of initiative, they'll find it.

1:17:10They just will find it. There's going to be so much opportunity. It's going to be so exciting. And I think, again, creativity, and especially young people using their imaginations, they're not held back by any preconceived notions. I ask all the questions I ask because I'm trying to solve little question marks having my head about the future. And it's really difficult at this time to see around the corner because so much is changing so quickly. And there's all of these converging technologies as you describe robotics and AI. And then when I put robotics in AI together, you're a fuck. To don't even, because I'm going to, I keep coming back to this question of what am I going to do?

1:17:52And not in, I'm just going to sit. You know it's good about that? No, it's really good about that. That will motivate you. It does. Of course it does. It's great. It motivates me to ask people like you the question 17 times in a row. Yeah. But it's a real point because I run businesses. We have at our headquarters, which is around the corner, it's about 25 ,000 square foot office. We have hundreds of people in that building. And I'm thinking about the roles that we're hiring for. And we're now looking at them through the lens of agentech AI agents. And then if I overlay that with robotics and AI, you know, I'm going to go, there's what roles would we need to hire in the future?

1:18:31Because theoretically, like can you name a single role in a media company that would, when I'm talking about in the robotics era, that would really need to be done by a human. I guess other than one could say human to human sales, we still have some kind of element of human touch to them. You know, though, I mean, we've learned a lot from the ancient game of Go. Yeah. So you've heard about AlphaGo, which was AlphaBet Google, basically devising a program to compute against the Go champions. Go is much more complicated than chess. Yeah, it's like a game, a board game, basically. So I think the champion of the world at the time was a South Korean.

1:19:23And he was sure he was going to beat this machine. Well, the machine beat him. And he was crestfallen. And then he got his Hutzpah to use New York word back. And he said, wait a minute. I'm going to start playing against machines. And so now he's playing against machines. His game is so much better that when he competes against humans and those competitions are the more important ones. Right? When he competes against other human beings, the machine has kept him at his champion. And of course, everyone's using the machine. So we're going to artificial intelligence. But he still can't be a machine.

1:20:13Can he? He's still can't beat the best machine in the world. No, he can't. And then... I mean, he can occasionally. But people don't want to go see machines competing against machines. I get that in... Because humans like human era and they like to be able to relate and to aspire. But as it relates to the world of work, the incentive is productivity. And my humanoid robot isn't going to get sick. And it's going to have a PhD in everything. So I don't want to see a human failing at their desk. Right. Oh, right, right, right, right, right. But then your robot and your AI is really focused on the past, right?

1:20:55That's what it's ingested. It can make predictions based on that past. Pattern recognition. Which is how my brain works, right? But... But that's why we chose the word disruptive. Disruptive means the traditional world order and patterns, therefore, that the robots and others will recognize is going to change, right? So what does that mean? So when we're doing our research, we have a white sheet of paper. There's no history for this, right? And so we're doing a lot of original research. So AI machines might use our research as there, because we put it out there. How does AI think differently to a human, though?

1:21:42In terms of... I thought the human brain was building, you know, predicting essentially something based on lots of information. And AI is basically doing the same thing with neural networks. It's making a prediction based on lots of new information. And therefore, if we get to AI, it can create new information. Yes. And it will. But I mean, AI, Elon will say it's two years away. And it does seem, you know, we're able to generate PhDs and rocket scientists now in the AI world. So he's probably right. But I also think about this as giving us super intelligence. So could chat, CVT, do what we've done?

1:22:24Maybe I don't know. Actually, it's a very interesting exercise. I'm going to ask our team to do that before I put it out. To do a model, a SpaceX model, financial model, income statement, balance sheet, cash flow statement, between now and 2050, when we have in the 2040s, Elon expects, if not sooner, to colonize Mars. I'll see what kind of model it comes back with. In terms of how correct it is and what it uses to get there. I'll do that now. SpaceX. A financial model. Or income statement. OK. Income statement. It was the really smart model. Let's do 3 .0. Make a space, you're an investment space ex.

1:23:17Yes, in the private fund, yes. So am I. Make a space ex, income statement.

1:23:28Income statement based on Elon's predictions. Yes. Elon's predictions. Yes. This will be very interesting. Now, until 2050. OK. I'll put that on the screen so everybody can watch. And this is essentially going to look at everything he said about going to Mars and colonizing Mars. And then tell you how valuable that company is going to be. Yes. I'm not sure if you asked the question that way. Did you say? I just said make a space ex income statement based on Elon's predictions from now until 2050. And then I can ask it what the market cap would be. I wonder how long it's going to think. It's thinking for a while.

1:24:06Yeah, it's going to think a long time I have a feeling. And then it's going to take you through. And I think it was interesting, deep seek. The breakthrough it had on the reasoning side was kept asking questions so it could get to the right answer faster. I think they're all adopting it now because deep seeks open source. Yeah. And they did need to spend as much money on the training side because they said. That's what they say. They said $6 million trained on a high end workstation. And that of course caused a trillion dollars worth of damage in the US market within VIDEA. One of the biggest casualties because people said, well, wait a minute.

1:24:51We're doing these data centers. You mean we don't need all those big data centers servers to do this work. We could do a high end workstation for $6 million. The answer is the pre training for that model was done on a 50 ,000 GPU cluster that the hedge fund had. And the last step of the large language model was the $6 million step. Okay, it's made its mind up now. So it says Starlink revenue in 2050 would be 250 billion. It says launch and starship revenue would be 120 billion. So the total revenue would be 370 billion. Cost of goods sold would be 172 billion. Gross profit there for would be 200 billion.

1:25:45Operating expenses, 37 billion. Operating income would be 161 billion after tax. So the net income would be 128 billion. All right. And I have to be honest, I haven't seen the last stage of this model. We haven't. That would be very interesting. I'd love to get a copy of that if you could send it. 100 % of the early militias straight after. You know, when I last chat, you be too earlier. I said, who is the number one woman in the world in investing? It repeatedly said your name. So that's a pretty remarkable thing to have accomplished, especially in a male dominated industry, where there isn't many women that managed to rise to the top of that industry.

1:26:29So what is it about you in hindsight? You know, it's difficult to be objective about oneself. But what is it about you that meant that you were successful in a male dominated industry? In an industry that's incredibly difficult to be successful in? My advice to all young people getting into their first job especially, but even later jobs is my mission when I started was to make my boss look brilliant. Now, why do I say that? It's much more applicable today and possible today than it was back when there were no computers and no cell phones, which is when I started, right? But what did I do? My boss wanted to communicate.

1:27:14He was an economist, wanted to communicate in charts that, you know, he couldn't find. So I figured out a way. I went to our time sharing system. That's all you could do back then. Time sharing is an ancient mainframe technology. And I figured out a way to make these charts and delight him. And I love doing it. And I loved learning. I love learning about technology. I learned tech and about economics through him. So that was the first thing. And then... Why is it important to make your boss look good? Well, I think because if you do make him look good, first of all, you should... You owe him a debt of gratitude if he turns around and gives you more growth opportunities.

1:28:10So... But if he or she doesn't, then you know it's time to go to the next place where you make that next boss look brilliant. And maybe you have the growth trajectory. I had bosses who... They love the fact that I loved what I was doing, that I had such high conviction in what I was doing. And I'm going to give Art Laffer a lot of credit for that. When I walked in to the financial world, I knew more about economics than most of the people in the room. And that was a great source of confidence, a great source of confidence. And when I was leaving that firm, someone said, my boss at the time said, I was moving from LA to New York, my boss said, you've only been doing this for three years.

1:29:00You're not ready to become their economist. And I just thought I was ready. And more important, the company to which I was going thought I was ready. And as I was leaving, both he and others said, remember, you know more about economics than anyone else in the room you'll... So take that with you. And I did. And I think that sense of confidence in understanding the way the world works from a macroeconomic point of view was critically important. Now, when I got to New York, I could not even speak Art Laffer's name because the Laffer curve says, if you cut tax rates that are too high, you will get more revenue.

1:29:47And what had happened is Ronald Reagan had cut tax rates. But Paul Volker at the Fed was trying to starve the economy of inflation. So we were back -to -back recessions and no, the government wasn't getting more revenue. So Art Laffer was, you know, on... I couldn't say anything, but you know, that was fine. I knew he was going to be right. And we were right. That was the story of the 80s and 90s. And that's why Geneson Associates and the Chief Investment Officer there, SIGSIGALAS, gave me an opportunity to get into equity research. I wanted to grow. I loved the stock market. And he loved my conviction.

1:30:32And so he started me on cyclical companies, which of course I would know a lot about. But Geneson was primarily a tech -oriented firm. And of course, knowing that, I wanted to delight the boss. I wanted to get into the technologies. And I made it my business to know as much about them. And I was the only one willing to research stocks outside the US. Think about that now. Art Laffer. Arthur Laffer. Yes. He wrote this letter. Oh, he did? He wrote this letter describing you. Oh, to you? To me. Oh. He said there was this young lady named Kathy Duddy, like a Kathy Wood, whose face was the map of Ireland and whose ambition was over the moon.

1:31:21I was a tough teacher and grader. And Kathy's first steps were shaky, but in short order, she rose to the occasion and aced the course, impressed as I was. And believe me, I was very impressed. I helped Kathy land her first job at Capital Group in LA. And from that point in time, it was game on. I followed her career closely after Capital Group, then on to Tepello, and her final job as an employee at Alliance Bernstein. As you may imagine, she was the star investor at each stage. And in 2014, Kathy took a giant entrepreneurial leap in the founding and funding of Arch Invest. And the letter goes on to say she's a mega success and good bless her.

1:32:01She never has forgotten her now aged professor. Well, that was very nice of him.

1:32:12So he has been so important to my career now. I'm going to get a little weepy, but I gave him 1 % of my company when I started it. And so he deserved it. He deserved it because he gave me a big break. He believed in me first. Why is that making emotional? I don't know. We have. We've gone through our life together. And what's so interesting now is, it's so interesting and fun is Bitcoin has rejuvenated art. He's 85 years old or 84. And I'm seeing his excitement. And he wants to spread the word around the world. And now we're going into stable coins together. And he just started an account on X.

1:33:07He has a flip phone. He doesn't do email. And yet he has just started an account on X. And so we now have this technology relationship because he wasn't going to technology. But he knows he's seen like art altogether. We have 3 .3 million followers. And he's seen the reach that X has. And he's also, I think, the other thing. And I'm having to answer your question. It was just very nice of him to do that, you know. And I see it's a typed one page. Very sweet. We have a closing truth from this podcast where the last guest leaves a question for the next guest. Not knowing who they're leaving it for.

1:33:46And the question left for you is, great question for you. What is the craziest idea you ever had that turned out to be right? Well, there are just a few, one thing that it's not that crazy, but it just gives you a sense of how not obvious in the early days of arc. I remember saying, I remember saying, well, you know, autonomous vehicles are robots. And I was in a research meeting and I was like, no, they're not. And of course they are. You know, it's a crazy idea. And there was something, I mean, there are some things I'll say. And the reason that's important from our point of view is this convergence idea.

1:34:41Robotics, AI, energy storage. It's, wait a minute, this is a very big idea. So it seemed, it seemed like, no, it's like, I think it is. And so it was like, we were, we were, you know, feeling our way in the dark because I was 2014. And nobody was really talking about them. And there's something like that very recently. Oh, we were talking, it's not a crazy idea. It's just, we're trying to solve problems. Someone, as we were going on and on at our brainstorm on Friday about humanoid robots. Someone, he's, he's our, what do we call him? What do you call, curmudgeon? No, good way, in a good way. I don't even know what curmudgeon means.

1:35:25Curmudgeon means, kind of. Contrarian or? Curmudgeon like, yeah, yeah, yeah, that's not going to work, you know. He, humanoid robots, he said, I don't think that's going to be a thing. He said, we really need robots that are going to be able to carry a lot. More in terms of weight than those things will on those stilts. And in my mind, kind of flashed transformer robots, they'd have legs and all of that. You'd be able to fold them up so they look like a tamp tank. And so that's what I said on, I know this doesn't sound so crazy to you, but I just imagining the future, going to Disneyland, when I'm 11 years old, we had just come over from Ireland and seeing someone holding a phone on the carousel for progress and, you know, saying, I'm going to have one of those.

1:36:26It sounded crazy at the time and I felt a little crazy, but always... So you think we can have transformer robots? Yeah. So the robot that cleans my house can transform and maybe become a robot. And everybody left it me. But I think that's going to happen. And another one was... And this was on... These are just little ideas in terms of how things hit my brain. But someone was talking about boring, which is another one of Elon's companies, the underground transportation. The external stuff. Yeah. I forget what someone said in a post on X. But my answer was Mars, obviously. And people were laughing at that.

1:37:12And then, as they were talking about, they were saying, of course, they're going to put that transportation system underground. We learned why you shouldn't have it on top of the ground from Earth. So just a little thing. It's like, catch me in a funny way. It's not the craziest. They're just like, oh, maybe that is the way things are going to work. I wonder if if Elon dies before we get to Mars, or if he just dies in the next 10 years from anything, from any cause, how much of an impact that will have on our rate of progress, generally, with space and electric vehicles and humanoid robots, can be quite profound.

1:37:45Well, he is getting us so far along that, you know, there's just going to be a runway he's created for years and years. Think about it, Mars, 2040 -50, you know? Kathy, thank you. Thank you for doing what you do. And that's a sort of multifaceted point of gratitude, because you do so much. You do so much in educating all of us in terms of innovation, investing, and what the future looks like. But also from your funds perspective and your company's perspective, you do so much in open sourcing and putting the research and the work that you guys do out into the world when you don't necessarily have to.

1:38:23But as I've heard you say, it's a great benefit both to the world, but also you do it because it also brings people to your fund, right? Yes. And it certainly did for me that's how I came across you many, many years ago when I was reading some research with my brother around investing in the future and innovation and understanding your thesis around all of those things. But also from the education side, you're distilling this complex research into simple language and information that the next generation can understand. So that this moment of transition doesn't catch them off guard, and that's an incredible thing.

1:38:54But I have to say as well, you know, such an inspiration for the very fact that you have achieved what you've achieved in your life. It's exceed, it's extremely rare for someone. And I don't always like to talk about gender or race or those kinds of things, but it's a point of, it's a particular point, a pertinent point in this case because you have succeeded in a very male dominated industry. And I think just your presence, your existence alone, is going to inspire lots of women and men, people like me, to pursue finance and investing as a career. Oh. So thank you so much for doing what you do.

1:39:27And thank you for being here, you are. It's incredibly important. And you've demystified so many things for me over the years, even though we've never met, but watching your videos and reading the research that you guys put out. So I'm going to link all of that below and link to your websites and your funds and all those things so people can learn more. But yeah, thank you. Thank you, Steve. And thank you for doing what you do. And it's been an honor and a privilege. And I know you have an incredible audience. So you've built a fantastic business here. And I have a feeling that this new world, that your fearing is going to be very good to you.

1:39:59I hope so. Yes. Thank you.

1:40:04The hardest conversations are often the ones we avoid. But what if you had the right question to start them with? Every single guest on the Diereversio has left behind a question in this diary. And it's a question designed to challenge, to connect, and to go deeper with the next guest. And these are all the questions that I have here in my hand. On one side, you've got the question that was asked, the name of the person who wrote it. And on the other side, if you scan that, you can watch the person who came after, who answered it. 51 questions, split across three different levels, the warm -up level, the open -up level, and the deep level.

1:40:40So you decide how deep the conversation goes. And people play these conversation cards in boardrooms at work, in bedrooms, alone at night, and on first dates. And everywhere in between. I'll put a link to the conversation cards in the description below, and you can get yours at the Diary .com. Quick one, just give me 30 seconds of your time. Two things I wanted to say. The first thing is a huge thank you for listening and tuning into the show, week after week. Means the world to all of us. And this really is a dream that we absolutely never had, and couldn't have imagined getting to this place.

1:41:11But secondly, it's a dream where we feel like we're only just getting started. And if you enjoy what we do here, please join the 24 % of people that listen to this podcast regularly. And follow us on this app. Here's a promise I'm going to make to you. I'm going to do everything in my power to make this show as good as I can, now and into the future. We're going to deliver the guests that you want me to speak to, and we're going to continue to keep doing all of the things you love about this show. Thank you.

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