The Week: AI, GLP-1s, and Scott's Iran War Reversal

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1:46George Hahn:Welcome to the week from Prop G Media, where we break down what mattered and what it all means. I'm George Hahn, and it's Friday, June 5th. Today, we get into the growing cost of the AI boom, why one pharmaceutical CEO believes medicine may be more transformative than AI, and why Scott is now rethinking his support for military action in Iran. Let's get into it. This week, Scott and Ed took Prof. G. Markets on the road. On Friday, they were in San Francisco, the global capital of AI optimism. And Scott had a reality check ready. Nearly 50 ,000 workers have been laid off this year supposedly because of AI.

2:33And that's almost as many as in all of 2025. For companies adopting AI, the thesis is simple. AI is going to do, is supposed to do much of the work that humans do. In recent weeks, however, that thesis has hit a roadblock. More and more companies are reporting that despite the enormous power of AI, the technology is actually more expensive than the humans that it is supposed to replace. Uber, for example, just blew through its entire 2026 AI budget in just four months. According to the COO, it is now getting harder to justify AI costs within the company. Microsoft is canceling its clawed code licenses across multiple divisions because it's simply gotten too expensive.

3:16And over at NVIDIA, one executive said that the cost of compute is now, quote, far beyond the cost of employees, which all raises a crucial question for the AI industry, which we just hinted at earlier, and that is at what point does AI actually stop being worth it? So this has blown up basically in the last 48 hours, where many companies are now coming out and saying, we're actually not as confident about this whole AI thing as we used to be. And now the question becomes, at what point will AI actually pay off? So I will pose that question to you. At what point is it too much? I think we're already seeing hints of it.

3:58And I don't think, I think it comes down to incentives. You were talking about how you're trying to incentivize people. Kind of an interesting part of the ecosystem right now and the different layers is the adoption layer, trying to get people to use it. and companies have put in place the incentives to try and get people to use AI more. But there was a recent survey by a professor at MIT that he found that about 5 % of the projects that people are using tokens for, they can actually connect, the CFOs can connect to some sort of return. So while I think that they're really intoxicated, it was like using AI as much as you can and talking about it in your earnings call.

4:37It's like adding.com back in the 90s. But look what happened in 2000. This definitely does feel like 99. And I'm waiting for the first CEO to come out and say, we have to get procurement involved and we have to dramatically scale back our expenses here. I don't think it's that romantic. I think it's just going to be a traditional Fortune 500 company that starts the narrative of, okay, this has been fun, but we have to dramatically decrease our AI investment because we're not seeing the type of ROI we'd anticipated.

5:13George Hahn:And yet, the IPOs are still coming. SpaceX, OpenAI, and Anthropic are all set to go public this year at a combined valuation of roughly$4 trillion. Scott's advice to anyone holding shares in any of those companies was loud and clear. Oh my God, sell it. If any of you hold shares in any of these companies, just trust me on this. As a guy who was looking at jets when he was 34, sell everything. And there's always going to be pressure from the VCs and your managers. Aren't you in it to win it? Yeah, fuck you. I need a house, bitch. Sell everything. By Monday night, the conversation had shifted from Silicon Valley to Hollywood.

6:05George Hahn:and from the companies building AI to the people AI is supposedly replacing. According to McKinsey, AI could redistribute roughly$60 billion of annual revenue across film and television within five years of mass adoption. So Scott and Ed put the question directly to Netflix co-CEO Ted Sarandos. Are the industry's fears justified? I think it's overestimated. I think like every other technology advance in entertainment and storytelling, it's made the business better and bigger by presenting more opportunity. And I think creators today are going to use it. I've seen this evolution from the beginning of friends who are writers who said, we're going to do everything we can to stop AI.

6:52It's going to destroy our careers to the point where they're using Claude as a writing partner today. And they basically use it, train it to say, this is how I write. This is how I think about character. This is how I move story. Here's everything I've ever written. Now, you're not allowed to write anything for me, but you can bounce ideas off of me all day long. And it makes them a better writer. They believe it makes them a better writer. It doesn't replace a writer's room because a writer's room will come up with a couple of good ideas, a couple of interesting ideas, a couple of original ideas.

7:26AI is not built to do that ever. I mean, the tool itself is built to give you the most predictable outcome possible. The antithesis of what we're trying to do when we make a TV show or a film. So will AI help things? I look at things right now of how we're using it in production today. Things like previs. So even just think about the technically working out a very complicated stunt shot before you do it, which increases the safety on set. I mean, people forget that people die on these productions all the time. And so these kinds of things are making the business a lot more efficient with something.

8:02And again, I don't think it's meant to replace any creativity. I don't think it's designed for that. And on its best day, it won't do that. And if somebody says, well, what about if you need a script? You don't need a script that's surprising. You've seen these, you know, these Hallmark movies and these kind of things. They want them to be predictable. Well, the cost of the script for those movies, about 1 % of the budget. So it's not a gigantic savings for anyone to do that or pursue that. So I'm actually much more excited about the upside and the potential of the technology, then I'm worried about it's going to displace creatives.

8:33George Hahn:For Sarandos, AI is another tool. For investors, it's still a bet. And that's becoming a theme of this moment. Technologies with enormous promise that still have to prove they can deliver, which brings us to healthcare. Scott has been saying for a while that GLP-1 drugs may be more transformative than AI. This week, he sat down with the man at the center of that bet, David Ricks, chair and CEO of Eli Lilly. The drugs are unique in a few properties here, Scott. One is, usually we get drugs that work on average, but they work for some people and not for others. That's sort of the more common pattern for medicine.

9:18But here, pretty much universally, products like ZepBound or our new one, Foundale, they work. People lose weight. Almost everybody who takes them loses weight. That's an interesting thing. And then, of course, people like to lose weight. That's another interesting thing. Most people, when you have a chronic disease and your doctor gives you a medication, you take it, you feel a little bit worse and you definitely feel a little poorer, but you don't feel any different. You're told that you're mitigating some long-term thing. But with these drugs, of course, they change your chronic disease risk or they actually change the chronic disease if you have a comorbidity.

9:57but people also like being on them. I think that's a very different property than we're used to seeing. Those things all combined, and the fact that obesity is kind of like a nodal health condition for more than 200 chronic diseases, I think gives us a shot if we can make enough and get them to people through the channels of healthcare, which we could talk about, which are deeply broken, then we can make a huge difference in longevity, life expectancy, and suffering.

10:26George Hahn:Even if these drugs work, can America's health care system actually deliver them? That's the paradox of American health care. Last year, Americans spent$5.3 trillion on health care, more than any country in the world by far. That's more than$15 ,000 per person and nearly one-fifth of the entire economy. Yet, Americans still live shorter lives than people in most comparable wealthy nations. And while much of the public's anger is directed at insurers, many economists argue the bigger driver of rising costs is hospital pricing and consolidation. That's the focus of Scott's latest Prof G Plus deep dive.

11:16George Hahn:Why health care keeps getting more expensive, why outcomes aren't keeping pace, and why the system remains so difficult to fix. The takeaway? We've spent six decades trying to fix a structurally broken market with market tools, and the bill is now$5.3 trillion a year in climbing. By 2033, one in every$5 in the American economy will go to healthcare. The question is not whether we can afford to fix this. It's when we will run out of money and figure out we could never afford not to. Or simply put, stop transferring capital from earners and laborers to the enterprise and shareholders. If you'd like to hear the full deep dive, it's available now for Prof G Plus subscribers at profgmedia.com.

12:07George Hahn:We'll be right back after the break.

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13:15Tomorrow morning is knocking. Stock your fridge now. How about a creamy mocha frappuccino drink? Or a sweet vanilla? Smooth caramel, maybe. Or a white chocolate mocha. Whichever you choose, delicious coffee awaits. Find Starbucks frappuccino drinks wherever you buy your groceries. Support for the show comes from Odoo. Running a business is hard enough, and you don't need to make it harder with a dozen different apps that don't speak to each other. One for sales, another for inventory, a separate one for accounting. Before you know it, you find yourself drowning in software and processes instead of focusing on what matters, growing your business.

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14:38George Hahn:Welcome back. The Iran war is now in its fourth month. The ceasefire talks are murky, inflation is up, and the strategic picture looks nothing like what was promised. On Tuesday's Raging Moderates, Jess asked Scott the question that's been hanging in the air. Given everything that's happened, does he still stand by his early support for military action? As you're talking, I'm also playing back your commentary from the start of this war for the first month, you know, four to six weeks, where you thought that this was the right thing to do. And I think that there are a lot of people who are now looking at this saying, like, how did you bungle it so badly?

15:23Right. That it is undoubtedly a better world in which Iran is not moving closer to getting a nuclear weapon or, God forbid, getting it in a few months time. that, you know, there was military precision, certainly at the outset, taking out huge chunks of the Iranian Navy, depleting missile capabilities. And then it's like everything just stopped, right? That we became frozen in time, essentially. And I don't think it's for lack of interest on the part of reporters in covering what's going on here. But we see no more stories about their oil supply? Didn't we have, you know, 45 to 60 days before the oil would go back, right, and the infrastructure would burst?

16:07What happened to that, right? Are they getting it out in some way that we're not aware of? It's crazy how little interest there is on such an important global plot line at this point. But again, Donald Trump is a terrible business person. He is a rich kid who, if he'd invested in his inheritance and S &P funds would be much wealthier than he is now before he was able to monetize the White House and the U.S. government. And he's just he has not taken a basic game theory or strategy course. Yeah, he does want it. He wants out. He realizes this is this is a quagmire for him. And it was a mistake to go in.

16:46And by the way, people such as myself who supported military action, we can sort of fall back on the notion, well, OK, take out some missile capabilities, strike while the air defenses are down. We have to own this. This is turning into a national disaster of like Iraq-like proportions. And the notion when he says, I don't care, what he's trying to do is signal strength, hoping they will want to come to the table and do a deal. I see almost no reason that the IRGC would want a deal right now. I think they feel like we can have total and complete victory. These guys are going to have to leave with their tail between their legs.

17:25Just to clarify, if it felt this way, I wasn't attacking you for your original position. I was pointing out how much goodwill they've squandered. I deserve to be attacked. One of the things I don't like about Republicans or some of our leadership is they never own their mistake. Let me own my mistake. Looking back on what has happened here, it is hard to make a rational case for how in any way, shape, or form, this was a good idea.

17:49George Hahn:And before we let you go, Here's one of our favorite Algebra of Happiness segments from Scott. Algebra of Happiness. A lot of young people, more young people than ever as a proportion of the population are struggling with anxiety. And I did a podcast yesterday with Anthony Scaramucci and Dan Harris from 10 % Happier. And Dan has really been, the term is brave, but very useful in helping other people discuss and address their anxiety. He struggles with panic attacks. And he talks a lot about different cognitive behavioral therapy to help them manage through that anxiety. And he has this statement that I just love, and that is, action absorbs anxiety.

18:34And I'm going to share a story that is not a Hallmark story, but I think it's relevant. I coach young men. And one young man in junior college, about early 20s, we're just sort of talking. And I can kind of tell what's on his mind. I'm like, what's on your mind? everything's fine so yeah he's like i'm a little bit freaked out right now and i said what's up and he said i've been having trouble paying i'm like what do you mean by that i have trouble paying but it's because i have a huge prostate he goes no it's been feeling funny and weird down there and i'm worried i have an std and i said well have you had unprotected sex recently and he said yes i have and and i said look i know exactly how to do this i know exactly what you need to do.

19:17Right now, right now, you need to go to urgent care or there are all sorts of STD clinics in your city, lives in a city, and you need to get tested right away. And on the way to the doctor, you're going to start to feel better because you're taking action. And fortunately, we live in a society right now where the vast majority, if not all of STDs, can even can be handled or addressed. And as soon as you start taking action against this problem or this issue, you're going to feel better. Action absorbs anxiety. And at the end of life, you're not going to regret what happened to you. You're going to regret being so stressed out about it.

19:58And that is, if you're worried about anything with your health, you immediately go to the fucking doctor. And maybe that's a point of privilege for me because I have the money. But if you have resources, if you're insured, if you can go to urgent care, you want to address this situation. Whenever your health is bothering you, immediately, the moment you make the appointment, you start feeling better. I am addressing it. Action absorbs anxiety. You want to move against this. This is really upsetting me. This is bothering me. How am I going to solve it? Fuck, I can't get an internship. I can't get a job.

20:32Well, okay. What do you need to do to get a job? You need to send out resumes. You need to put together a resume. When you start putting together your resume, that action starts absorbing your anxiety. It's very simple. Get out of your head. Get out of your head. At the end of your life, you're not going to be upset about an STD scare, not being able to get a job, or a health scare. The thing you're going to be worried about or the thing you're going to regret is how anxious you were about it. And here's what you do. You move to action. Action absorbs anxiety.

21:05George Hahn:We'll be back next Friday with a fresh edition of the week from Prop G Media, breaking down what mattered and what it all means. I'm George Hahn. Have a bangin' weekend.

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