All-In with Chamath, Jason, Sacks & Friedberg - E57: Understanding Omicron, tech stocks plummet, VC's great resignation, Jack Dorsey's departure

Episode Date: December 4, 2021

(0:00) Bestie Intro: Miami talk, gambling stories, Nancy Pelosi's retirement plans (12:30) Understanding the Omicron variant (24:49) Tech stocks plummet: why the selloff? (33:44) Inflation: here to stay? What's the 10-year outlook? (44:57) Anticipating a "Great Resignation" of successful VCs (54:45) Tech people ruining Art Basel, comparing Bay Area / South Florida immigrant communities in terms of political activity, success of Indian-Americans in tech (1:02:08) Mike Bloomberg donates $750M to charter schools (1:07:52) Jack Dorsey's departure from Twitter, what it means for free speech Follow the besties: https://twitter.com/chamath https://linktr.ee/calacanis https://twitter.com/DavidSacks https://twitter.com/friedberg Follow the pod: https://twitter.com/theallinpod https://linktr.ee/allinpodcast Intro Music Credit: https://rb.gy/tppkzl https://twitter.com/yung_spielburg Intro Video Credit: https://twitter.com/TheZachEffect Referenced in the show: https://twitter.com/trvrb https://www.nejm.org/doi/full/10.1056/NEJMoa2115463 https://twitter.com/erictopol/status/1466799350990839810 https://twitter.com/Jason/status/1465037481187987457 https://www.wsj.com/articles/china-set-to-create-new-stateowned-rare-earths-giant-11638545586 https://www.shippingandfreightresource.com/china-us-freight-rates-plunge-but-china-manufacturing-woes-create-new-headaches-for-shippers https://fortune.com/2021/08/09/lumber-prices-down-2018-levels https://twitter.com/rabois/status/1466816803418615812 https://twitter.com/michelletandler/status/1465393612577853440 https://www.wsj.com/articles/michael-bloomberg-why-im-backing-charter-schools-covid-19-learning-loss-teachers-union-11638371324 https://www.technologyreview.com/2020/11/18/1012066/emtech-stage-twitters-cto-on-misinformation https://bariweiss.substack.com/p/twitter-is-about-to-get-way-worse

Yeah, Tomoth goes to those sorts of events and they all pick some endangered animal and then they skin it and they make a sweater out of it for them. That's not a luminati sh** luminati. So this is Casimir, it's Laura Piana. The lining is Chinchilla. Oh, Chinchilla, I knew it. She's new and some poor animal. It is so... Poor animal.

Phenomenal. Probably nicer than a dog. It's so warm. Probably sweeter than any dog you've ever met if you actually played with the Chinchilla. It's so warm. So's sweeter than any dog you've ever met if you actually played with the kid. It's so warm. I'm just rubbing it. Pita is a white hotting the show right now.

Who? But it cares. Nobody cares. Nobody cares. Nobody cares. Nobody cares. Nobody cares. Nobody cares.

Nobody cares. Nobody cares. Nobody cares. Nobody cares. Nobody cares. Nobody cares. Nobody cares. Nobody cares. Nobody cares. Hey everybody, welcome to another episode of the All In Illuminati podcast. We took thanks given off, but the Illuminati is back to tell you what's going on in the star chamber. David Freiberg, the Sultan of science, Queen of Canoas, with us.

I like it. Super thin, looking shfelt. David Sacks, at his fighting weight, 168 to 172 pounds in the red corner, and with a Kashmir Chinchilla sweater. Chinchilla. The Ergo from Sri Lanka at 142 pounds. Shabaa. Pali hava.

Tiya. And I'm, of course, Jay. I'm at my, I'm at my, not peak weight, but in my 20s and 30s, I was like 172 pounds.

Well, you're six foot, right? So that's six two. So I mean, I'm currently 166. What? Wow. And you are wearing a shirt. Wow, that's incredible. If I was 166, I would, I did my body skin. I was percentage body fat is what 14% 11.1% what you're going into elite athlete slash castaway territory. I've been there. I've been there. And sax lean body mass was 152.8 pounds. My basal metabolic rate was My basal metabolic rate was 1,868 calories. Okay. Sorry, sorry, sorry. And this was with my genes on, sorry, and this was midday, so I had breakfast.

So it was 171.9, so 172. So mine is the clothes in the morning, I think I'm 167 less eating. Amazing. Yeah, body, yeah. 11.1% body fat. My BMI was 22.7. That's incredible. Yeah. 11.1% body fat. My BMI was 22.7. That's incredible. Wow. Congratulations. All right. So we took Thanksgiving off, but we're back. And, of course, it's been a bit of a crazy run. Saks and I are in Miami for web 3.0. You would be delighted to know that there is no COVID in Florida.

They've solved the COVID problem, but. I miss you guys. I miss you guys. It's tough to take a week off. That was a mistake. We should have done a Thanksgiving episode. Yeah, it's lame to take a week off because I miss everybody. Yeah, I agree. Did everyone have a good Thanksgiving? I took my kids to Vegas. You did really? The older three me and that's that You did, really? The older three, me and Nats Dad,

we took the older three to Vegas, we took them to like, Blue Man group to... It was our good show. Line Safari. Although, Blue Man is a little loud actually, to be honest, I don't think it's really appropriate for kids too. Hey, or I almost had a seizure, so I don't like it. Yeah.

I think like, you can check those out of play craps. I like that Beatles Cirque du Soleil show. Beans love. Yeah, that would have been a better choice in the end. What else do we do? We took them to the adventure dome, which is like an indoor amusement park. What do you eat? Any good food? We ate a chipriani one night and carbon the next night. I was about to say man, those are those two places. Carbone with that vodka sauce. My I was talking to Jade about the carbon rigatatoni with vodka sauce, and she started making it for me.

Delicious. Delicious. It's unbelievable. It's so funny, you mentioned it, but both me and Popsie got it, and we were both like, this is freaking awesome. Spicy rigatoni. It's so delicious. I mean, you can make it at home, and it's pretty amazing.

A sacs. What was sure that you came to Miami for Thanksgiving and take it. Oh, wait, wait. So the best part is on and I want a hundred dimes, you know, play traps for a little bit. Bump, bump, bump, bink. Okay. So that plays for half the trips. Would you, would you play, you play it on court? I stayed at the, on court, I spiked the win for a hundred dimes, two hours. That's right. Right at the bottom of the the tower is that that little VIP area down there. And but what here's the best thing. I mean, you know, look, when you go to a casino,

the best thing is you put the dice in the hands of the person that's never rolled. I said to Sergio, I said, Bob, see, just go there. You're gonna start rolling. I'm not gonna talk to you. I'm not ignoring you, so please don't misinterpret this, but I'm just gonna let you be in your little zone.

He hit everything. Wow. Everything. Wow. For 30 minutes. And you got up, you left a winner. It's always about since I've done it. It's all about when you get up.

Speaking about when you get up, I have been with Saks. You wanna talk about Rainman? Literally when David Saks. Oh my God, Saks went off one night. Do you remember that night? He went off I was about to break up, but here's something with sacks How much was that? No beef it up now Beep it out. What is it? What was the number? All right? Well anyway, let me just tell you when sacks And I go to Vegas and he plays Blackjack, it's literally like the two of us coming down the escalator.

Tom Cruise and Rainman were ready to see us. We're going to go to Tom Cruise. I'm Tom Cruise and he's the Rainman. Literally, he's got his head tilt. He's like, Blackjack, yeah, we're going to play three hands of concurrent Blackjack with J-Cal. Of course, we're going to count of cards at the aria, at the high roller. And so we start high rolling. And I swear to God, this guy goes down, you know, a model X goes up, a plate, but he never gives up. He never gives up. And we're supposed to go to LA.

And I have a benefit dinner I've bought a table for. And he's like, I'm sorry, j-cal. I can't leave. So I show up for the benefit dinner, three hours late. They're closing the place down, they's like, I'm sorry, J. Cal. I can't leave. So I show up for the benefit dinner, three hours late. They're closing the place down the lake. Oh, thanks for showing up, J. Cal. And it was all because he had to come back up. But I've seen him come back from some gnarly defeats. What is the secret sense? Well, I saw Phil, you're a friend Phil Helmuth

and Brandon can't do the other night here in Miami. And they reminded me of that like legendary run where basically I think I bought in for like a hundred, you know, and I was down to like and I was playing two hands and I was down to my last like five and You know, I'd been like on a horrible losing streak and the hand came along where the dealer had like a five showing and I basically I doubled down for my last bets. The dealer like Mistyle, she did the cards out of order, and Phil made her rewind the cards and have him go back to where they were supposed to go instead of declaring the

enemy deal because I had doubled down with the five showing. Anyway, the pit boss came over, they ended up listening to Phil and I won those two hands and then from there I went on like and so and so and so can't to can't to actually remembers the stats He's like he's like you won 30 you won 85% of the hands in like the next two you know shoes Yeah, you won like 35 hands in a row. He's like it was unbelievable and Yeah, you can't feel hands in a row. He's like, it was unbelievable. And yeah, it was. Did you feel at the end of the night? He was there playing with me. It was him, man, then can't it was there as like kind of the real world.

You know, these these pro poker players, they are kind of savants for these kinds of things. They remember every hand every day. Go back years. They know that some random hand. Yeah. Every flop turn river is really unbelievable. They're gambling T-vos. They're gambling T-vos. They just, it's a DVR. But Brandon was even playing. It was basically Phil was there and then I was playing two hands and then Brandon was just hanging with us.

And he remembers like all the stats of like what happened for that whatever half hour it's bonkers, yeah. Okay, well since we took a week off, we apologize for taking the week off. We regret it Couple of things have happened. I don't know if you guys look at the stats, but we I couldn't believe it But we were the 41st most popular episode two episodes ago in the world So the pod has reached some sort of tipping point. I don't know if you're having this experience in Miami, David But is everybody stopping you to say they love all in? And did you see all the Spotify love of people

who watched like 3,000 minutes of all in? In their year of viral feature that Spotify came up with was a way to basically it generates a list of what your top shows were for the year based on listening minutes. So it's like actually mathematical. And then you can basically retweet that. So yeah, I've seen a lot of tweets of you all saying that we were number one or top five. I had one guy

stopped me at our puzzle. I don't get to stop that much, but there is a little bit more of that. Yeah, I'm going to stop constantly and it was just a flood. So thank you to everybody who shared that and for tuning in. And we're, we apologize, you're taking weeks off. We're going to have it no weeks off rule going forward. That's, that's absolutely necessary. But last week, we had a new variant come out. We've been talking about it a whole bunch. That's a big absolute necessary, but Last week We had a new variant come out. We've been talking about it a whole bunch I think about Miami. How was Miami? You been having a good time? Well, I got I got to tell a story about Miami, so okay all right

So I mean, I think this place is paradise, you know, first of all the the weather is just perfect this time A year San Francisco is miserable. It was like rainy and cold. We come here in the mid 70s all week. And of course, you're not stepping over hyper-during needles or feces or you're not worried of being randomly assaulted by a homeless drug addict having a psychotic break just for starters, right? So, you know, we've been like talking all week. We've been talking all week.

And that's just in your house. Right. Table. That's just in the mausoleum before you can just go into Starbucks. Yeah, that's just going to Starbucks, exactly. Yeah. So, Dave, we're having this conversation about, should we just move here full time? And, you know, it's like, it's a heart wrenching or gut wrenching decision because the kids have schools and friends and we've been in California a long time.

And so, here we are, ring our hands about whether to make this move. And all of a sudden, I read online, that Nancy Pelosi just spent 25 million buying her retirement house for when she loses the house in 2022, presumably she'll retire as speaker in January 23 when she's not speaking. She's gonna move to Santa Barbara.

No, she's moving to Florida. She bought a place in Japan. Probably wasn't true. Santa was, yeah. I know it turned out to be fake news. Well, I questioned that. I think it was true. And then she didn't like the bad press

so they bailed out of that deal. Well, we won't really know what's true until January of 2023, where we see where she retires to. But an event, so I'm reading this article and it says she's buying a house. It's where Tiger Woods lives and actually it's half an hour it's half an hour from where Donald Trump is. So here she is buying this house probably with ill-gotten insider trading profits and she's going to live. She's the best trader in the world. In the world. And our government officials,

she's got the best anxiety information. And she's planning to retire to a community of people she's demonized. I mean, starting with like Trump and then Tiger Woods. And so she's going to be living in this community of people who she's been moralizing against and demonizing against as the speaker of the house. And meanwhile, the rest of us are ring your hands whether we should stay in San Francisco, the city, the dystopian city that cheesed the political boss of, that her political machine is running to the ground. And I'm looking at this going like, oh no, you don't.

You're not leaving me holding the back for this. If you're going to board out, you can't just leave me holding the back. I'm like the last one in San Francisco. I'm returning out the lights. So did that tip of skill for you? Is that like, I'm definitely out of here. I'm like, if the boss of San Francisco is out of here, I'm definitely out of here. But I have to have some people

and some other people to convince. In fairness to Nancy Pelosi, she's sitting on a ton of equities and she does it when a big cap game is in California. So you gotta be fair to her. It's not like she wants to pay for the ridiculous spending in California when she does, you know, cash out all those chips. I guess, Freiburg, let's go to you to talk about the new variant. Maybe you could tell us how to pronounce it because there seems to be some debate about the pronunciation of this and what

you're taking on it. Or are you in a frat in college? You have to memorize the green alphabet. I went to school at night, so I didn't have to memorize the Greek alphabet. I went to school at night. So I didn't have the college experience, yeah. I think it's Omicron. But that's the Omicron. Omicron. Omicron. And they tried to get J.K.L.

Last time. Omicron. No, no. Omicron. Let's monetize the Greek alphabet. Megatron? It's not a transformed or J-Cal. Homicron, homicron, homicron. How much do you say?

Wait, how many times do I have to wait for me? Look at the Cuban sandwich after this. Yeah, come over here. Why aren't you guys together right now? I don't get it. I thought you guys would be in the same room. Let's go to the Cuban deli and play, I don't know. Cuban sandwich chicken.

Yes, who could eat less bites at the loser race? I have the place, I got the sandwich place over in Little Havana, that's unbelievable. But anyway, continue, tell us if it's the end of the world or no worry. No, I mean, it's, at this point, there's three things that scientists are looking out for, data on, one is kind of the innate transmissibility of this

variant, the second is, which is like, you know, the R naught in an unvaccinated population. The second is immunivasion, meaning it can get around antibody, they're get around people that are vaccinated or have had the virus. And then third is kind of the severity, right, which is like how many people translate into hospitalized cases. Okay. So every day there's, you know, varying data and information coming out, there's an is kind of the severity, right, which is like how many people translate into hospitalized cases. So every day there's varying data and information coming out, there's an incredible spike in South African surveillance data

and testing data. Right now as of today, I think 25% of people are getting tested in South Africa testing positive. Okay, wow, that's stunning. And yeah, and only about a quarter of the population is vaccinated there. So, this will be pretty telling pretty quickly on if hospitalizations start to climb and if the disease severity and unvaccinated population kind of matches or mimics what we've seen with other variants.

This variant is quite different, so there's like 30 mutations on the spike protein here. Normally, you'll see an evolution where one mutation leads to another variant, leads to another variant, and they call it a new variant when there's enough kind of differential behavior of the virus. So there's always mutations happening, but once a mutation causes a change in behavior, they know that it's a normally you see kind of an evolutionary

track where there's one mutation in another, then another, and so on. In this case, this mutation set is so far away from anything else that exists. There's like 30 new mutations that popped up on this sequence that's for this protein that it's like such a different virus. This is a major upgrade. Yeah. When did it? It's so different. It's almost like it's like a new virus altogether. It's almost like it's not a naturally occurring virus

that behaves like other viruses do. Okay, so cutting the conspiracy, what did you try to upgrade the virus? Let me cut the conspiracy theory for a second and just say what the current consensus thinking is of what may have caused this incredible change. One is that someone or some people that have severe immune compromised

systems had a virus in them that did not kill them, but just kept circulating in their bodies for months and months and months and mutated so much that it got to the point, and this is what's really interesting. It got to the point that it mutated such that it can now transmit a month of vaccinated population. So think about the virus finally found a way out of the flood gates and the flood gates are blocked in by vaccinated population. So think about the virus finally found a way out of the floodgates, and the floodgates are blocked in by vaccinated people. And so that's kind of one reasonable explanation. The other one is that South Africa is just a monitoring station, right? There's a whole big chunk of Africa where we have no surveillance going on. There's no genetic sequencing going on. And there could have been anywhere in Southern Africa or even in Central Africa that these viruses could

have been circulating amongst populations for the last year and a half with no surveillance or testing or sequencing. And all of a sudden, one person travels to South Africa and boom, this thing pops up on the radar and everyone's like, oh, wow, look at what we just stumbled into. So look, one thing that seems pretty certain, this variant is going to be everywhere fast. Like it is so transmissible by some estimates. And you can read Trevor Bedford or there's a bunch of great folks on Twitter, you can kind of follow their writings on this,

but Trevor's done a great job. The R-Nought on this could be as high as 40, which is measles by comparison is 12 to 13. Now, it's more likely that the R-Nought is somewhere between 7 and 20, It's more likely that the R0 is somewhere between 7 and 20, but regardless, it seems to be that high in the presence of an immunized population, meaning it's got incredibly good evasiveness around people that have the vaccine or have had the virus. So it's going to spread like crazy. I think this whole thing is a complete fucking nothing burger. Yeah. And so that's the other side.

It's like, maybe it's just not a big deal. And it ends up being like Delta. And it sort of spreads around. A lot of people don't know they have it. And then all the sudden, it's even more impotent. It's even more impotent than Delta. So that is, that is definitely something that people are saying because there's not a lot of new hospitalization, spiking in South Africa. We're not seeing severe cases of all these people, you know, 25% of people are testing positive. They're showing mild to no symptoms, and that's anecdotal right now.

So we'll know in the next two weeks of whether this actually changes hospitalization. To me, this is more of an example of yet again, how unreliable our institutions are than anything else. We knew nothing about this. We had a couple of cases, and the mainstream media literally in a moment where there was, frankly, not a lot of news.

So essentially, here is the day after Thanksgiving for people, this is when it broke Friday, after Thanksgiving. Exactly. Essentially, manufactured this histrionic reaction to something where we didn't know anything about it, we didn't know how important it was, we didn't know how bad it was, we didn't know anything about it. We didn't know how important it was. We didn't know how bad it was. We didn't know anything.

And then what happened was then the financial media took that and then ran with it basically trying to whip up even more history on X but within the financial markets, which then feed the mainstream news cycle and we had this whole loop going down the toilet bowl and low and behold, I think what we're actually learning is what we should have just waited a few days to realize beforehand, which is it's not that severe, but to the extent that it is, we've sequenced it, we have vaccines and we can deploy these quickly. Oh, by the way, at the same time, the New England Journal of Medicine put out the study, which basically showed how important inefficacious these vaccines are. So the fact that we're even talking about this to me

is just absolutely emotional and not practical or useful. It's the big question, Chamath, is it's not about whether it is functionally nothing burger or not, but what's really important now is how policy-maker they're going to respond to this, right? Because there is a press cycle, there is a bit of a hysteria. Everyone's asking me about it. Everyone's freaked out about it. Everyone's worrying about it.

And so the policy makers are going to respond to that sentiment. And the question is, are we about to face more lockdowns and things that are going to be adverse to the economy and how our markets are going to react, not necessarily to the true severity and the risk of this variant, but more importantly, to the policy decisions that are going to come out of the perceived risk of this variant. And that seems pretty scary right now. Well, you saw Biden. I mean, one thing I'll give him is this.

I mean, he's, I think he's done a bad job in a lot of other things, but on this, his political instincts were sound, which is he said very clearly we're not going to go back to lockdowns. And I think he was really speaking to Democratic governors when he said that. People like Avid Nusom and our poker friend, JB Fritzker and Whitmer and Michigan, listen guys, we're not going back to lockdowns,

no matter what happens with the Omicron thing. We're not gonna do school closures, we've seen how in popular the school closures were in this off-year election It was one of the big issues that helped Glenn Youngkin win Virginia, which had previously voted for Biden by 10 so I think you saw the message come down from on high We're not going to go back to lockdowns now I think though that what that does is admit and I think what Amarcon will show is that lockdowns didn't work at all. At most, lockdowns and all these measures, whether it's mass mandates or whatever,

all it did was delay the timing of the virus. What you're going to see is Omicron will be everywhere very soon. There's nothing that policymakers can do to stop it. The only thing that seems to work is vaccines and booster shots. There's some good data around the third data, the third booster preventing serious cases. Other than vaccines, and I guess the one thing policymakers could do would be to get red tape out of the way so they can more quickly come out with a booster to this new variant. That would be the one thing they could really help with. But otherwise,

nothing policymakers have done has helped. And I think this is going to be an admission that ultimately lockdowns were a disaster for the economy. We nobody could argue lockdowns are not just for the economy, but in the early days when we go back to, you know, when the pandemic started, we really didn't know how to handle this. We did not have any treatments and we were ventilating people

and essentially killing them by blowing oxygen into their lungs to, you know, aggressively from what I understand. So, you know, wait, wasn't it? That's a, yeah. Okay, well, I mean, I think it's a debate because we're not ventilating people now as much as we were, right? We're flipping them over, etc. But the lockdowns did correct me if I'm wrong, Friedberg, at least allow us to not

have the hospitals overrun like they were in New York and Italy. And that was, I don't know if that's true. I honestly don't know if the hospital... I don't know if the lockdowns actually changed that we don't know. Look, I'm going to sound like some... And now we're going to, you know, kind of enter into this controversial territory. But... Sure.

It seems like a lot of people still got together in private settings. Oh, of course. And the virus continued to spread. And so there is a question around how effective lockdowns were and how much they really did change the trajectory of the spread of the virus. And yes, they probably did have a muting effect. But it's unclear what the trade-off was and whether it was really worthwhile. And at the end of the day, a few days and a few weeks after they started, people were

over. And they started meeting on the internet. We didn't know how delia was though. At that time, we didn't know how delia was. At mid-Ali, we didn't know a lot at the beginning of the pandemic. And so you have to, I think, give people a break for the mistakes that were made, say, in March or April.

I think by May, it was pretty clear the lockdowns weren't going to work. If they had worked, states like California wouldn't have had 10 pages of exceptions based on how politically connected you were. So for example, the local bartender had her bar run out of business by lockdowns, but Hollywood studios would get a break on their productions. But, so we know that lockdowns didn't work otherwise.

We wouldn't have been these exceptions. And we have data from Sweden. Remember, all the hysteria about Sweden, basically, was doing nothing. They weren't doing lockdowns. They weren't doing any dates. They were going for herd immunity. They were going for herd immunity. They were going for herd immunity. And they were killing, they were killing their people.

Well, guess what, Sweden's data was nowhere saying body else's, the hospitals weren't overrun. And I think what Omicron will finally show is that our whole policy since the beginning of COVID, whether it was two weeks to stop the spread or these vaccine mandates, or even this idea of herd immunity, it's all been to try and put the genie back in the bottle. In other words, it's been to try and defeat COVID.

It's to put this virus back in the lab, I guess you could say. And the reality is we're never going to defeat it. I mean, it really is something that we're going to have to learn to live with and to manage. And so, you know, it'll be a seasonal disease and it'll be something like the flu in terms of how it cycles each year. And it seems unlikely that it's going to be eradicated through vaccination. Let me pull Chimauz back in. Chimauz is a variant that matters. But this is not it. And all like, instead, what we really need to do is have a process of not overreacting because there's going to be a number of these into the future. And the only thing that really decays the vaccine's potency,

or sorry, the COVID's potency is having it go through vaccinated people. And thank God we had so many people vaccinated because this is what we're so again this whole thing is a nothing burger Let's just move on it's stupid Well, so the market the markets are obviously reacting maybe we should talk about our Riaxing to that I think that they are Picking excuse like people who are in the traditions and this is a great excuse Yeah, look at look look the week before when I started to trim It was like oh how dare you blah blah, blah, blah, blah.

You know, and I'm like, well, I don't know if the smartest people are selling. Maybe it makes, makes sense to sell. So I started to trim and I'm so glad that I did because it was, you know, 10 days ahead or a week ahead of all of this craziness. Now, look at what's happening in the markets today. People are going massively risk off. You know, there are almost 500 stocks that are off 30 or 40% in the last 30 days. But the stock market is still basically at all time highs. So think of that for a second. So everybody that thinks that the stock market is doing poorly is wrong.

It is doing exceptionally well. It's just that the 400 stocks that people in Silicon Valley really care about have been getting kicked in the teeth. And the paper company and the, you know, the specialty chemicals company have actually done reasonably well. Which are my thoughts. Which is nothing that any of us have exposure to,

or you know, some of us don't have exposure to. So go ahead Jason. Shroomoth, can we, can we, can we, then look at this as, hey, the era of, we're gonna give a lot of credit to companies for,'s going to happen in the next 10 years. 10-year outcomes.

Yeah. The 10-year outcome that we saw, Rivian came up, and then many other stocks, and obviously crypto falls into this. This idea of giving people a decade of forward-looking credit maybe is going to come back to- I think it's true early- It's really- It's way these and look at earnings or maybe- No, I'm not going to say that because I think it's

too early for us to sort of go and jump to these conclusions. Right now, we are in a moment. There have been 71 or two of these moments since 2009, where you have either a sector drawdown or a market drawdown. In this case, we're in the middle of a massive growth sector drawdown. The multiples on these companies are shrinking. Companies like Snowflake and Peloton, sure, Cloud Flare, we're trading at 70 to 100 times revenue and people are re-evaluating whether those multiples are worth it. The irrespective of the quality of the company, because those are very high quality companies. So we're just re-rating the risk right now.

Okay. And it's not broad based. The real problem is all these companies that I think raised a lot of money in private markets are now going to get stuck because if the public markets have compressed multiples by 30 to 50%, they are the ultimate buyer. The idea that you can wait and then go public later may not stand to reason, especially if inflation really keeps these multiples in, you know, in check. And so all these private businesses and then all of the ones that sort of were planning

IPOs in the next 12 to 18 months are probably in a little bit more of a challenging spot than they were before. We're seeing a lot of, I mean, Timoth, is it not true that we're seeing a bunch of these SPAC deals and new issuances come out to market with converts attached to them? So rather than getting a straight valuation and common equity rolled, these deals are coming out where investors are saying, look, I'll value this thing, but I want to get paid a preferred return and I want to have some seniority over the common.

And so I can protect my investment to some degree. At least that's what I'm hearing from bankers is kind of the rumbling in the SPAC and pipe market right now is these kind of protective new types of equities that are coming out. In order that the investors can kind of keep their mark on their private valuation rounds, but get the company out to public, but the public market is getting a better deal than just straight common equity. Look, it's like bringing Pepto Bismult to Mexico. If you're worried about an upset stomach, don't go to Mexico. Okay, and we just lost seven percent

of the audience. But you're saying you wouldn't invest in these converts for these kind of companies that need that? You're focusing too much on the symptomology and not the root cause. Right. The minute that you're trying to wrap all these features around something, you know, the nature of those kinds of features is that it's trying to subsidize what is otherwise not a clear, simple, viable story at that price. So either change the price or change the company. Yeah.

I will say one important point about what's going on. A lot of people have said this is a crash, and that term's been used a lot. But you know, because people that have only traded in markets and have a brief history, call it back to the 2000s. The last three major drawdowns have been the dot com crash, then the financial crisis, and then the COVID crash. And all of them had true systemic risk that caused, there's all these ripple effects and secondary effects. And for all you guys, it seems to me that this time what's going on is a devaluation that

doesn't have systemic risk attached to it. If these... Well, we had this happen in 2018 because in 2018, it looked like there was going to be inflation. Powell basically killed the market. He raised rates. And then it turned out he was completely wrong and China was okay and everything was fine. And then the market just completely violently snapped back. Again, this is what I'm saying, which is, it's too early to tell whether this is just

a short-term opportunity for people who have made a lot of money to de-risk. And again, Satya and Adela just sold 300 million to stock. We wanted a sold 10th position. It was half of this position. Yeah, I mean, that's, that to me was insignificant. Elon must sold, you know, 10 billion. I've sold almost to, I think, six or seven hundred million dollars worth of stuff this year. Like, this is what I think smart market participants do. You don't just wait and just try to mark to market the last tick. So you think there is systemic risk in here? Yeah. I mean,

so, well, look, first of all, what's going on here? I mean, Chimouth is right that over the last four weeks, we've seen a 30 to 50% decline in these tech growth stocks. What is the reason for that? Interest rate expectations driven by inflation. For the first six months of the year, all you heard out of Washington, the administration was this inflation was transitory. That story is basically that collapsed

because now people can see that as persistent. They're now pricing in the risk of interest rate increases. Oh, sacks, you're breaking up. He's done. He's done. He's done. I think the fed just cut off. He got cut off. He's probably still talking. He's probably still talking.

He's on a monologue right now. He's got his downstairs cutting it right now. Yeah, Henry Belkowski can tick-talk him. Well, whoever wrote this part of the speech that he has prepared for us, or a spot, super-crashful, like, oh, that was my best speech writing. I think it's one of that guys' names. I'm sure it's annotated,

so he can go back to that point in his diet. Absolutely, yes. I mean, I think actually this is an AI version. This is like a defake of sacks that we just played at this point for this moment. We do the sacks. We reboot the sacks. The sex simulation. Well, I mean, if you look at private markets,

it's obvious that they were getting ahead of themselves and I think to your point, Shamaath, when we were talking before about what a private market company's doing in this situation. Well, you know, I was advising them if you can get out of high valuation and you can get clean terms, you take the money, sure, if it's from quality investors, but just make sure that you have enough runway to fill into this valuation

if there is valuation compression, which is what there is now. So the idea that a private company with 20 million or 30 million in SaaS revenue was worth 50, 60, 70 times that. That's not the case right now in the public markets and maybe it goes back down to 20 or 30, but you just have to have that runway to land the plane, correct? Yeah, one way to think about that is it's less about people often use that high multiple to refer to this year's numbers, but what the market is doing typically in those situations is they're saying the multiple in the future will be X. And so they're saying we project five, ten years out this revenue, and I'm paying one to five times revenue, you know, for seven to 10 years out or whatever the right kind of

way that they're framing that up. But then the commentators on the market pricing come in and they say, Hey, you guys are crazy, you're paying a hundred times revenue. And the market isn't thinking about this year's revenue. They're thinking about revenue in your seven through 10. Yes. That giving credit, right? They're giving credit, right?

Yeah. And they can't do that now because interest rates, let's say interest rates climbed to 3.5%. I can go make 3.5% by putting my money in for a 10-year bond. And now I can't kind of, and so I have to discount that future back from 10 years out. And now I'm only going to be able to value it in five years out. So now my revenue for five years out is like a little bit lower and the multiple I'm going to give them a little lower. So the valuation today gets a little bit lower. And that's how these

things kind of translate as a function of interest rates. It's a little bit harder to make a bet on a 10 year horizon because interest rates are no longer 0%. So you have to kind of make a bet on a five year horizon or three year horizon. And if interest rates are really high, you betting on this year's numbers. Right. Shemoth, I think we should talk a little bit about this inflation concept, that did a little tweets from the, you know, about this sort of transitory versus,

you know, perpetual, and I do think, and we've talked about it here, we've crossed that rubricon of, everybody is raising prices because everybody else is raising prices, not necessarily even because they are experiencing higher costs in their business, but they're just like, my haircuts costing more,

my stakes costing more, I've got to charge more for whatever my service is. Is there any way to unwind this inflation? It seems to me like the reason we've had no inflation for so many decades of our entire lives, like I mean, genes in the 1980s cost the same as genes now was because of globalization and efficiency. Well, that took what, three decades or four decades of just constant innovation and constant globalization. Well, we've already got globalization maxed out, perhaps too much globalization, right,

that we learned that we actually have risk associated with this supply chain. And how much more efficiency is there in making a pair of jeans? I don't know if we're going to be making them in a slurry. So is there a path to unwind it? Rich people not having their equities be worth as much, then maybe it trickles down. It's unprecedented, right? I think what happens in the stock market is absolutely irrelevant. Huh.

It doesn't matter. I mean, you know, we focus on it a lot, but you know, when we talk about the core structural economy, the stock market is a lagging indicator of a whole bunch of things. Sometimes it's cash flow, a lot of the times it's emotion. Money supply. Money supply.

I think that there's a much more important thing which we've talked about, which is that we have said, and I have said, that coming out of the pandemic, we are moving the world back into a more decentralized place, right? The centralization was this just in time, you know, single supply chain, single point of failure existence. And if you look inside of China, the thing that they want more than anything else is to become even more centralized, right? I don't know if you saw today, but there was an article in the Wall Street Journal about how China is going to create basically an overall holding company

to own all the rare earths that are made inside of China and then to apportion them out as they see fit. So the government will now control a critical element and supply chain into climate change. It's basically they're creating their own op-hack in a way, like their own version of. It's a very good way of saying it exactly. So China's pushing more and more for centralization. We, for example, myself and Fortress, we did this deal a few a year ago to bring this company public called MP Materials, and the whole idea was to start to build diversity in the supply chain, to build a decentralized supply of all kinds of things.

In that case, it was around these rare earths because we saw this thing happening in China. The problem is, those kinds of investments are very much few and far between. So the solution to fixing the core structural inflation we have is going to take a decade. It's going to take trillions of dollars of investment and more than that, I think it's going to take an enormous amount of coordination between private and public participants. And I think that that's where this whole thing fails, which is why I'm a little bit more concerned about it. And I think I've explained this to you, but look, we have massively under-invested in the

level of infrastructure we need to support ourselves. Yeah, we outsource. Like as in a simple example, like starting in 2016, we absolutely decapitated the ability for the United States to invest in our own true energy independence. Okay? You know, the level of fracking, the level of Nat gas, oil,

all of this stuff basically fell off of a cliff. And you would say, well, that was the right capital allocation decision because of climate change. Well it turns out today not really because we have absolutely no investments on the climate change side. Right. We don't have rare earths, we don't have lithium, we don't have nickel, we don't have cobalt, we don't have graphite.

So we actually can't make the batteries, which means that now oil is at $100 a barrel and gas costs 10 bucks at the pump. So that was a coordination problem. Really the right thing to have done would have been to continue to invest in our domestic supply chain for energy, while we also created incentives to decarbonize. So this is what I mean by these issues have been building up for years, Jason. Yeah, decades. Inflation is now here, I think it's here to last. I've been pretty consistent about this. And this is the real reason why we're going to have a few years of pain. And so money losing unprofitable businesses selling future cash flows in 10 to 12 years. I mean, some people

will buy them, but I won't be free. I just sent you a link to freight rates for cargo ships coming from China to LA. And you'll see in the last, you know, call it month and a half or so, you know, starting in the peak. Yeah. Yeah. So starting in April, it was like whatever $2,000 and it climbed up to nearly 20, nearly what 10x over that period of time. And then in September, it started to decline and it dropped by 50% and it's continuing to drop week after week right now. And we're seeing the same in lumber prices right now. I'll send you another link to how lumber prices have kind of declined precipitously also

from an early part of the year peak. And we're seeing this across a lot of these kind of supply markets, where we were talking about inflation being the driver, and a lot of the economists have befed and other policy makers were talking about these being kind of transitory pricing effects. And so there's a bit of a mixed bag emerging, right? We are seeing in some of these markets

that prices have declined by 50, 75% in just the last few weeks. By the way, the supply chain distortions have sort of right-sived and the demand and the supply started to balance out a bit more. And that's creating, I think, a better kind of certainty around pricing, better reliability on these supply chains. And a lot of folks estimate that this will take all the way through 2022 for that supply chain kind of glutt in mism match to work its way all the way through the consumer.

Yeah, to the consumer. And so there are a number of points of view that say look, these pricing issues that we've been seeing in the recent term. May in fact still be transitory. We may see them work their way out of the end of 2022. And we're starting to see the early signs of that actually playing out. 2022 and we're starting to see the early signs of that actually playing out. And so I would say the jury's still out. Generally, we've obviously doubled the amount of US dollars that are in supply or increased it by 50% a year. We've got, you know, increased rates at zero. We've got, you know, people aren't going to reduce their wages, right? Wages are only going to go up.

And there's a lot of things that you make the point of, like, spending is only going to go up. The government's never going to spend the last. By the way, just on that point, the government changed their formula for what is considered a conforming mortgage. I think it kicks in in January and essentially it basically allows US homeowners to have a million dollar mortgage and have it essentially be conforming. Now that's like a pretty large increase.

I think it's almost 20% from what it used to be. Why is that important? Think of the amount of money that's stuck in US real estate by US homeowners, who now all of a sudden can have conforming loans that are, you know, which used to be jumpos or super jumpos. So worse terms become better terms. You have more equity. You can pull out more money.

I think that people will spend that money. And so, even on the consumer side, I think that you have an impetus to spend. I was the one thing I wanted to say, I wanted to clarify something I said earlier. It's very difficult to buy these long-dated businesses promising huge cash flows in the future. There is one kind of version of that company, though, that you can buy, in my opinion, and what I am still buying, which is deep physical science and R&D, because those businesses, in some ways, are still on a risk-adjusted basis, in my opinion, great bets to make.

But otherwise, you want to be allocated to- I'm spending a lot of money on research and are going to have future products. It doesn't necessarily have to be a lot of money, but that the outcome in success is so asymmetric. Those are really interesting to me, businesses in moments like this were, you know, if I'm, if I'm delivering my portfolio, that's how I'm thinking about it, which is I want to make those kind of bets in the future. But one thing I think that could help unwind this, and I think it's to your point, Friedberg, about some of the indigestion is starting to work its way through the system and there could be two things occurring at the same time. We could be have more money supply,

prices could be going up, homes could be going up, lumber could be coming down, but that doesn't mean that the person constructing a home is just going to magically say, oh wow, I spent less on lumber, I can take a million dollars off the price of this new home or a hundred thousand even, whatever it is. But competition does seem to drive prices lower. And so if we do see more people participating as employees or employment, well, then there would be some competition for less competition for labor. And we might see more competition

other places in the economy. If there were more cars available, obviously people will try to win customers. Right now you don't have to win a customer if you're selling a car, even a used one. They're going for $10, $20,000.00.00. Use cars are going, people who bought used cars two years ago are selling them for the same price. So they got two years for free in their car, even though they put 10,000 miles on it. By the way, speaking about employment for a second, I saw the stat was pretty insane, but about 2.1 million people under-immigrated to the United States at the beginning of Trump's

tenure as president. What that means is that we lost about 2.1 million immigrants than we would have normally based on the run rate of how immigration should have worked. So, whether that was people being rejected at the border, or whether that was just people deciding that to come to the United States because of their feelings for Trump, we lost 2.1 million eligible workers over the those four years of his presidency. We also had a bunch of people who had degrees in certain jobs who basically gave up on their

profession, and we talked about this before, which is, the teacher who decides it's better off to just go work at Amazon, right? Then actually be a teacher because you actually get paid more now. And then the third thing is that there's a ton of people that are making an enormous amount of money through inheritance and through their parents

who are boomers, who are now in their 60s, 70s and 80s, and all of that is exacerbating this employment problem which you can only solve by raising wages, right? There's a time where people in the country, well, all of it just means that there are just fewer people to do the work, which means you're going to have to pay more to get the work done. Yeah, or we could let more people in the country

based on their specific skills. You put these two things together. Structural inflation is here. We've under invested at the macro level, and we've completely distorted people's incentives to work at the micro level. Prices go up. One thing I'm seeing in the market, and David's back with us, David Sacks, is that Keith or boy had this tweet, and I think we talked about a four or five episodes ago.

A bunch of capital allocators are saying, you know what? It was a great run, but I think I'm going to opt out. I'm going to move on to my next adventure. I don't want to deal with what we're dealing with here on this podcast, which is, what do you even make of this confluence of the pandemic, crypto, we've been make of this confluence of the pandemic, crypto, printing more money supply and interest and unknowable valuations in the face of massive technological change from AI, biology, et cetera. So I thought it would be interesting to talk about all of our decisions to stay in the

capital allocation game and what we think about this retiring group of capital allocators who are, let's face it, retiring at 50 or Well, I had coffee with Keith this morning and then he tweeted that on the heels of our conversation. So I think I can provide a little more insight into what he was thinking there. I think part of the backdrop here is the concern that we're going into a very different environment than what we've had over the last 10 years. I mean, over the last 10 years, we've basically had record good times because of this low interest rate environment, right? And low interest rate environments are fantastic for growth stocks. Now, it looks like we're moving into an environment in which inflation is certainly not transitory. We don't know how long it's going to last for. And that creates an expectation of its rates. They're going to rise. And so the next decade may not be as good

for growth stocks. And you've also had over the last year or two price levels have been much higher. So you've got to figure there's a whole cohort of ECUs who've had a great decade, who've made a lot of money. And now they're asking, does it really make sense for me to sign up for another decade that may not look as good? And the truth is if you're not the principal of your firm, if you're one of 20 partners, it doesn't make as much sense for you to stay in the game when you've just had a fantastic decade. You've probably made more money than you thought

you're gonna make, and now you're not so sure about the next one. Pretty very thoughts. I mean, you still wanna build companies. Yeah, I'm like, I don't know, I like building stuff and building new stuff that's kind of gonna have a, you know, an impact and it's technically difficult. So that's kind of where I get drawn to spend my time. But I can understand people whose job it is to kind of manage other people's

money and invest it for them, you know, and they participate in the profits they generate. Realizing after some period of time, like, hey, I bought a bunch of lottery tickets. I mean, if you buy lottery tickets at the local 7-Eleven every day, and one day you hit the $12 million jackpot, you're not going back to 7-Eleven the next day to keep buying lottery tickets. And so, you know, in the context of being a money manager to generate returns, and that being kind of your principal interest,

and you kind of hit a return outcome that statistically you know will not happen again. I don't see the point of the hassle of going back to work. I could see the psychology of saying that that's enough for me. I do think however most VCs are truly, you know, we can kind of generalize all we want. But as we all know, we have lots of friends who are VCs. And I'd say generally the majority of them are very intellectually curious and driven. And what I am seeing is a shift of people who have had successful investing track records

and have had massive outcomes, shifting their attention now, they take some time off. And I'd say almost 100% of them come back and they always ask for a meeting and I'm like sure. And then they're like, I want to work on climate change solutions. And so what I'm seeing is this kind of second act happening now. And we've seen it with guys like Chris Saka and you know folks who have these massive massive outcomes in their first run. They know they're not going to, you know, the statistical likelihood of doing

that again is very low. But then, you But then after spending a couple of years on the ranch or surfing, you kind of wake up and you're like, I can't wanna do something meaningful with my life, I got kids, I look them in the eye and I'm like, what should we do to get? What do I wanna do for the future for my children? And they all kind of come back around. So one of the things I'm seeing is this kind of second act

phenomenon where VCs are moving away from being pure play technologists and making money to saying, I want to do stuff that's a little bit more meaningful and altruistic, coming into climate change. And as a result, we're seeing insane funding happening in climate change tech companies or climate tech or whatever the heck the label is this week. Stuff that in my opinion doesn't make any sense, businesses that aren't real businesses, technologies that don't actually make sense, it'll never work out. But hey, that's always been the case in venture, right? One out of a thousand works and, you know, changes the world. But we are seeing that.

And that's kind of a personal observation, is I'm seeing a lot of these second acts going after climate change. Shemoffe, this last year is, like, or 18 months, pretty exhausting as a capital allocator to try to make sense of the world and get your bearings. It's like going through multiple storms. Does that make you more engaged? I get the sense knowing you for a long time that you and I might be similar. Yeah, the chessboards are getting mixed up. The pieces and the values are getting changed.

Whatever it's making me more excited to participate and try to figure it out. Yeah. It's like a hand to poker to me. I'm more intellectually stimulated now. Me too. I'm the most engaged I've ever been. Yeah, I, I mean, look, I left the money management business five years ago, I guess. And honestly, it was a very hard path, but it's been the most rewarding

because I was able to focus on the things that I wanted. Look, if you do this job well, this job is voting for change with your money and making change using money. And that's great because money is not that useful beyond a very small amount. And then you have to question like, what are your real priorities? So yeah, like grinding away at something that matters to me I've always find fulfilling and I feel like I am an athlete whose muscle doesn't decay by my mid-30s but probably decays in my 70s or 80s which is my brain and so you know I I'm only, you know, I'm only, I'm a rookie. So I'm excited. Yeah. I'm glad. The fact that things are compressing or maybe there'll be less startups or less

capital allocators involved, what I've seen in my career at post.com error web 2.0, amazing time to be alive, amazing time because there were less anybody who started a company after the Dockombust or after the 2008 financial crisis was a legitimate warrior who wanted to change the world and was incredibly focused. And then the sense of entitlement I'm seeing on all sides of the table right now, from founders to board members to investors, it just seems like everybody's in some sort of mad dash to secure some bag by any means necessary. And there's no focus on the customers and the product and the team. Everybody's, you know, living in some just manic, you know, grab money grab.

You know, when you're in the middle of a paintball war, you know, you're trying to, you're trying to shoot the paintball gun and you're trying to hit people and it's a little bit crazy on the field. But, you know, as everyone kind of gets back to the locker room and they take their win, you know, all humans ultimately are are gonna be driven by a desire to leave something in the world to make an impact of some sort. And at some point, all the folks who have made a ton of money in this cycle,

there were a lot of folks who made a ton of money in the last cycle are kinda asking themselves, how do I leave an impact? How do I make an impact in the world? And I still have a skill set and I still have a capability to do so. And so then there's this search for meaning. And that's where you see kind of the climate change and the health care and all these other

kind of paths start to form for people. I do think Web 3 also offers another path of opportunity for folks where they can kind of rewrite the internet and think about how to reinvent the social model for humanity, the economic model for humanity, the governance model for humanity, the economic model for humanity, the governance model for humanity, the communications model for humanity, and Web3 creates that visionary platform opportunity, and folks are all excited about what's next. Once the dust settles a little bit, and you put some money in your pocket, and you realize it's not going to change your life more than it did last week.

You want to make an impact and then folks kind of come back and they start pursuing, what impact will lie? Sax, let's go to you. Sax, what was Roboi talking about? What were you guys talking about in this breakfast? Keith and I just talked about how we're about to enter a very different kind of macro environment for growth stocks. And we don't know how long it's going to take, but there's no question that multiples

and valuations are going to come down. And there's a lot of younger founders and investors who never lived through a bear market or a down cycle, and they're about to get a root awakening. So look, I think it's a little different for us because we're all principles at our firms and so therefore if we're not happy about something we can simply effectuate a change in strategy. But if you're one of 20 partners at a giant firm, even if you're the most successful one, it's hard for you to move that ship and your returns get divided by, you know, it's one over end where end is the number of like full partner shares.

And you know, if you've just made a ton of money over the last 10 years and you're thinking about whether you want to sign up for going through a bunch of choppy waters, there's a lot of good reasons right now for people to reevaluate. Now look, Keith and I were both discussing the context of, hey, this would be great for us because we're not going anywhere. But, but Keith did think that because the macro picture is changing, that is one more reason for people who are on the fence and thinking about retiring

to move forward with that. All right, so I think we've talked about capital allocation and we got the variant and we got the markets. Can I just point out how like, sex, it seems like you and J. Cal and everyone are kind of in Miami at art basil and this thing's been going on for years and it's a art fair. Yeah, but it's like tech has taken it over. Like the tech community seems has this kind of consistent trend of going to these like esoteric kind of call it originally artistically created events and spaces. It was like Sundance and then it was Burning Man and now it's like Miami art basil and kind of like ruining it. Ruinning it, taking it for themselves. You know, hey, that's tech

week in Miami, but it was like it's art basil has been going on for forever. It's NFT basil, they're calling it. NFT basil, yeah. Roodle. It's Roodle. It's literally. I feel bad for all the real creatives. Yeah, we're the ugly Americans who come in and ruin the artisanal feel of the place. And they've fled the place with cash. But look, no, one difference between Florida

or Miami in particular and California and San Francisco in particular is nobody hates money or success over here. They're happy for you know all these rich people to come in and spend their money They really believe in capitalism over here. You've got this huge Cuban immigrant population who had direct experience with socialism and Argentinians of people from South America and I mean they teach their kids in schools, the evils of socialism. So yeah, nobody here is looking to purge the rich. That's nice. It's funny, Sacks, because the Bay Area, right, the Bay Area has a huge South Asian population, right? And a huge immigrant population.

Why is that not the case in California, right? Why is this huge immigrant population, whether they come from South America, Latin America, or they come from South Asia, India, China, do we not have the same sort of response here for pushback against socialist tendencies and the push for? Well, the big difference in South Florida is that those immigrant communities were politically active and got really ingrained in the political process. difference in South Florida is that those immigrant communities were politically active and

got really ingrained in the political process. And so they were a loud voice. You know, systemically, what happens in South Asian families is we just don't do that. It's just not a thing. And in fact, if you look inside of our countries, the politicians are just the absolute sketchiest, most brutal folks. And so, you know, when you have people that got, you know, double e-degrees from IIT, the last thing that they're thinking

is like, I want to run for mayor of Santa Clara. That doesn't happen. So it's just that big cultural distinction between the Chinese and South Asian populations versus the South American populations. I have to say San Francisco has become truly dystopian. I went to San Francisco to see a comedy show. It's on Manage who is a big fan of this part.

He is an incredible show, by the way. And what was sad is he's amazing. And he did a show about MBS and him getting into it with the Kingdom and Patriot Act to show. It was one of the most powerful like one man shows I've seen. It's kind of transcends comedy, but I took Sunny, our friend Sunny, and we had a great time,

but we walked through Union Square because we wanted to get like a drink. We walked through Union Square and it was cordoned off with cop cars at every intersection and there's no cars in the street. And I was like, what's going on? Is there some police activity? And I was like, they're like, no, the Louis Vuitton store got knocked off. I kid you not. Every single store has had every single window boarded up like it's a hurricane season, but they all did them in pitch black. So it must have been like one vendor came and did this for every vendor, but like Zara, the gap, Nike, every single store front has been boarded up. And then there are security guards outside and you have to make an appointment to go Christmas shopping and

Literally, they have road blockades of multiple cars at every intersection because these smashing grabs Have become so brazen and dangerous. There were 30 or 40 people involved in that one at the Louis Vuitton store Can you imagine your shopping for Christmas and this is the logical result or everything I've been warning about since the beginning of the year. You have prosecutors like Chase Ibudini who have essentially decriminalized theft by refusing to prosecute it. After the Louis Vuitton looting, he comes out and says, well, don't bring this noise around a town. That's what he calls crime as noise. And he's trying to pretend like it's, it didn't arise in San Francisco, like somehow it's come from out of town. No, you created it by refusing to prosecute these types of crimes.

And then after talking tough, the first thing he did, he already released. The police actually caught some of these looters of the LVMH. He has released them on zero bail. Exactly. The prison, the jail is a revolving door They have zero bail and so the people who did this are ready on on bail

Chase a talk's tough when he crossed when he charges them But the charges are never actually brought their prison thrown out and it is dystopian and we couldn't find a place to have a drink every single bar We just want to have like a post you know comedy show drink and and by the way, it's on the huge fan of the pod We have we talked for an hour if they showed you a broadcast stage, it's really, really class act. We should have them on the pod at some point. Do we want to talk about Jack leaving Twitter? Well, there's a segue here.

I mean, Jamoth mentioned that you have these immigrant minorities from South Asia, I'd say Indian Americans, Chinese Americans. They've been spectacularly successful in the United States. Maybe they haven't been as politically active as, say, Americans, Chinese Americans, they've been spectacularly successful in the United States. Maybe they haven't been as politically active as say the Cuban Americans or Argentinian Americans in Florida, but they've been incredibly successful. You had another example about this week with Jack leaving Twitter, his replacement is Parag Agarwal, he's an Indian American.

So you now have Indian immigrants, I guess, first or second generation running Google with Sundar, Sasha Nadella, Microsoft, the CEO of Adobe, Shantanu, Nareian, the CEOs of MasterCard Nokia, NADF and IBM, all Indian Americans. So there's no question that people of color can be spectacularly successful in the United States. And I think those communities are too mess with the browns. Hold on, those communities are so busy availing themselves of the abundant opportunities for success in this country that they haven't been basically involved in politics because they haven't been complaining about anything. They've just been succeeding.

Too busy winning. Too busy winning. Too busy winning. Yeah, there's a viral joke. If you're a CEO in Silicon Valley, you live long enough to see yourself replaced by an Indian CEO that trended. Hallelujah. Hallelujah. Look, you have Satya Sundar. There's like four or five other examples, but it's now just absolutely a great triumph. It's amazing for our society that a lot of people who are immigrants or sons of immigrants come here and run the largest, most dynamic, important companies in the world. This is an incredible win, and we have to reboot immigration in this country.

I believe in this very strongly that we need to get more intelligent people here. And if you come here for your degree, we need to staple a green card to your degree when you come up and pick it up on stage at Stanford or Harvard or whatever. Community college, you should stay here and build companies here. We have to really open that up. That was one of the huge failings of the Trump presidency and now going into Biden who doesn't seem to care about immigration either. Both of these people is huge fails. Both parties do not want to bring intelligent people here. I want to talk about Mike Bloomberg's $750 million donations. Okay, that's what I'm done. Explain to people what happened.

He's given 750 to charter schools. Am I correct? First of all, Mike's a boss. I've known him for 15 years. He is the best. He is the best. The best. Absolutely stone cold boss.

Killer. Before I tell this story of what he did, you know, Mike was the largest donated donor to Johns Hopkins. And for years, he would donate without any fanfare. And this is something that I've actually copied from him. I've given up money to my Emma Mater, not anywhere near the same amount as he has. But, you know, after he passed the billion dollars of donations, he made it public and he was able to make Johns Hopkins permanently need blind. And so it's kind of like Johns Hopkins became this bastion to attract the smartest kids

period bar none, right? And everybody gets their way paid basically. He announced a program, $750 million over the next four or five years, I think to get 150,000 kids, Jason, tell me if I got this wrong, into charter schools all around the country. He basically just talked about how the pandemic has really let our kids down in every single way possible. He had these quotes from the leader of the California teachers union. And it was so odious to things that she said. And the biggest quote was basically like, you can recall

Gavin Newsom and you can recall the mayor of a city, but you can't recall me. So I'm just going to do what I want. And it was unbelievable. It was disgusting actually. Man, I wish you had one for president. Number one issue, I Glenn Youngkin, one in Virginia, was that was schools. It was the fact that you had these school lockdowns and closures, and then also the parents weren't happy with what's being taught in the schools. And the unions and the politicians are beholden to them are completely arrogant about this. And explicitly saying to the parents, you don't get to decide what your kids are. By way, Eric and it's the right word, David, if you read these quotes in the Wall Street Journal article, it's disgusting.

It's disgusting. It's disgusting the way this woman talks about our kids. It's really disgusting. And... Well, it takes a rare Democrat like Bloomberg to basically stand up to them. I mean, Biden certainly doesn't because they are the number one specialists

Democratic Party in terms of the manpower and boots in the ground, and donations. You will never hear a politician like Gavin Newsome ever stand up to them with democratic party in terms of the manpower and boots in the ground and donations, you will never hear a politician like Avenue, some ever stand up to them because he wants to be president. He doesn't want to cross any major interests in the democratic party. It takes an outsider like Bloomberg to do it. I can't understand how they were able to sell so effectively, anti-choice for parents in schools. Like everybody in the world, 100% of

people in America know that choice and competition equals better outcomes, better products. That's not up for debate. And somehow they were able to flip people's thinking that no, no competition in schools was more equitable and that created more equity in the world. How did they do that? Or how did they pull this off? They just paid everybody off? They didn't do that. They never gave parents a choice because parents didn't know a choice was possible. We took assistance and we had to then, we had to dilute people into thinking.

I'll tell you. No, they didn't have to dilute people. They just had to basically use their money to pay off a small cohort of individuals to basically back their own view. That's it. Here's some of her quotes if you want to read them. Number one, there's no such thing as learning loss because Mike Mike was basically saying that you know these kids have stopped learning and there's a huge learning

She said there's no such thing as learning loss She said in an interview with LA magazine our kids didn't lose anything. It's okay that hold on It's okay that our babies may not have learned their time stables They learned resilience. That's, honestly, that's a crock. That's a crock of who is this person? And how do we get her out of office? And what is she like?

But, but the money, the money quote was this one, you can recall the governor, you can recall the school board, but how are you going to recall me? That's really come on. Let's go. Sacks. You have purple pack. And this is, this is Cessalie, my art crews, the head of the Los Angeles teachers.

Somebody start recall Cessalie.org. We'll recall all of them. I think this recalling trend is brilliant. Like if people are absolutely not doing their job, yes, recall them. She should be allowed obviously to be a great representative for LA school teachers and fight on their behalf. That's what unions and union leaders are supposed to do. But something tells me between that goal

and how she expressed herself here, something has happened and that's corrupted her go-to-market, if you will, that if it's really scary. It's a tell. She has an arrogance there in those quotes. That's just obvious. Look, the thing about these progressive policies is they hurt the communities that they pretend to be speaking for the most. And so who is hurt by learning loss the most? It's disadvantaged kids who can't afford the tutors. And the private tutors, the exact same thing is true of defund the police and this decarceration and deprasecution.

The communities that get hit the hardest are the ones that are exposed to the most crime. They're basically the most to proverished areas, the rich people can hire private security, have high walls, live in gated communities. And so we're seeing over and over again, this is why Eric Adams, who basically is a pro police guy in New York City, got huge percentages of the votes of minority communities and places like the Bronx and Glen Youngkin did extremely well in Virginia with minority communities.

So, you know, these, and they tend to be primarily white progressives, like Jason Boudin, like Georgia, like Jessica, and like Evan, so they're the craziest ones. They're the craziest ones. They are so, these are luxury beliefs that they've learned. Absolutely. And their virtue signaling is so just,

luxury, luxury beliefs. Speaking of crazy woke progress, let's go back to the Twitter thing for a second, because I think there's a little bit more to say there about Jack Dorsey stepping down. Because I think there's a real fear on the part of a lot of people that Twitter now is going to slide into even greater censorship like YouTube has because now you have a CEO who you know,

Perrag who said last year in 2020 there's an article where he basically said that Twitter does not need to follow the principles of the First Amendment and its content moderation policy. So here you have a company. I mean, you just look at the bookends of Jack Dorsey's reign as CEO, and it's really a sharp contrast. You had, when Dick Hossel was CEO 10 years ago, he said, we are the free speech wing of the free speech party. And now, to Parag, as CEO, Dorsey's hand picks, assessor, 10, 11 years later, basically saying that the first amendment does not matter. They don't have to follow it when it comes to their cotton moderation. So I think it's been a real sea change over there and how they view their mission. They used to be in favor of free speech.

They used to think that what they're doing was democratizing. Now they basically are pushing this agenda of censorship. You've seen it censorship of a pin of really any opinion that violates the elite consensus, like on COVID, like on many of these issues. It could be simpler, David. It could just be that it's just really hard to run these things at scale. And so they're all just saying, you know what, it's so hard. I don't want to run it anymore.

I don't think it's that hard. I mean, so here's the thing. So Mike Solana had a column where he's basically arguing that that Jack Dorsey was really a secret Defender of the first amendment and the censorship would be even worse or will be once he's gone. I think there's some Yeah, I agree with that. I agree that it was Well, let me tell you the part I disagree with I agree I agree things are only gonna get worse once he's gone Well, no, I know he is for freedom of speech. He just didn't like

To have to deal with the government and all these issues. Like, I think it just became untenable because of the scale. But he is a free speech guy. But the ones that... Same with Larry Page. Same with Larry Page, yes. This is on a personal basis.

We know this. Evan Burke had a great quote saying that all is necessary for evil to triumph is for good men to do nothing. Jack Dorsey may be a good man, but he did nothing or very little to stop this agenda of censorship. When they came to him and said they're going to de-platform his sitting president state, all he had to say was no. No. He had the veto power and he didn't use it. Listen, he left, I mean, I hate to get into politics here because people hate this part of the show,

but he let he specifically believe that Trump should stay on the platform, because he was president, and he stood up to people for four years who told them, get president off. Like everybody was screaming, Trump shouldn't be on here and he said, no, he's the president. He should be on that. That was his position, David. It was really because of January 6th that he took him off. All these guys, Larry and Sergey, Mark Zuckerberg, Jack Dorsey, they are all fundamentally free speech people.

They believe in the power of the open internet. I remember in the early days at Google, the intention and the motivation behind the mission of Google was the democratization of access to information. And by creating access to information and making all information, all points of view, all data available, they believed

that democracy would flourish around the world. And that would enable these things that would allow the societies that were limited in information, access information to flourish and transform themselves. And I think the challenge arises when the political motivation where someone's voice that's being spoken is viewed and deemed to be harmful or viewed and deemed to be inflammatory or viewed and deemed to be inflammatory or viewed and deemed to be too violent, violence inducing. And that's where the push comes to shove in these, these kind of governance decisions that these folks end up having to make.

It's not an easy position, fundamentally, philosophically. I think that everyone that's involved in the internet, all technologists, they all have the same intention and motivation and point of view. But it is so friggin hard to navigate what ends up happening. Look at look at look and by the way, look at what happened to 4chan. 4chan was supposed to be this open, no one's going to touch it. Then there were pictures of people being murdered and rape and all this other sort of terrible stuff that emerged on 4chan.

Then they had to and same at Reddit, right? Remember the whole controversy around Reddit needing to clamp down and you know, Ellen and others got a lot of heat for clamping down on the free speech quote unquote of what was going on on Reddit. Yeah, there's a lot. There's a lot. Because there's a line.

And it's very hard. Your point of view on what the line should be and someone else's point of view on what the line should be is a difference of opinion. And at the end of the day, opinions are gonna draw. And your state of it is based on your guy getting banned. Let's be clear here. If your guy had been banned, that's the tip of your spear

no i think quite frankly i think the fact the fact that he's off twitter i think it's frankly great for for my team if you want to call it that because i'm actually we got a lot of their company look at that download the call in app and up store right now call it up is a bell that's what i'm going to play it up the call it up no i'm a leader spot you know what rights is she about the rights right now All it app is available on Edgeworn.com. You can go play it on the call it app. No, let me respond to you in your response words. It's your body right now. I had an incredible Barley salad. Okay, and then a little,

and then a little, and then a little, I'll answer, I'll answer what Friedberg said. Okay, so Friedberg is exactly, closing argument is this. Friedberg is exactly right about where the internet stood 10 years ago. You're right, that's suck and page and Dorsi all believed in the open internet.

They believed in the democratizing power of the internet when the green revolution happened in 2009 everybody was cheering. So what changed? I'll tell you what changed. In 2016, they got a candidate elected who they didn't like and their principles were so skin deep, basically so superficial that they completely flipped because they got one election where those are the result they didn't like. And so they turned against democracy. Look, Twitter and democracy worked in 2016.

The establishment lost because they had supported two decades of futile wars in the Middle East, trade policy with China, that hollowed out jobs, border policy it didn't make sense. The American people sent the establishment a message in 2016. The establishment should have taken the note, okay, but they didn't.

Instead what they did is blame social media for disinformation, Russian collusion, hate speech, white supremacy, what have you. And since then they've been on a mission to ban those things from their social networks. It is a total myth. Okay. The reason why Trump won the election 2016 is because of the issues he ran on. The establishment should have taken the note. Instead, they've been on this wall goose chase attack.

Hey, Nick, Nick. Can you just edit out that last part of Davis? I don't want anybody here. Thank you. Yeah, let's vote, yeah, let's vote, Damien's Trump red. I'm like, take that out. Take that out. Nick, take that out. We'll just leave it out. No, maybe he never said anything. Zach, don't you think the biggest winner here is going to be TikTok because if Twitter does go forward with the story.

Yeah, if they say, look, you can't put youth or generated content on our platform. If it has video and images of personal of people without their consent and approval. It's going to eliminate all of this democratization of access to video feeds of riots and crime and all sorts of things. Of course. It's a real big boom. So like at TikTok's not going to do that, TikTok's going to end up soaking up this whole market, right? For user generated content. Just so everybody knows what we're talking about, the day after jack left they said there's going to be a new safety and security again if you feel unsafe that's when you get that little your your intention should go up so if you feel unsafe because somebody posted a

picture of you even if you were in a public space which is completely valid you can take a picture of anybody in a public space that if you didn't consent and you feel unsafe then you can have it taken down and this is led to people thinking, like, you can't take a picture at a warrior's game of people in the background without getting the 20 people in the row to consent. It's kind of like a backstop, I think. But it is definitely a very bizarre position

to take that people in public can't have their picture taken. Because that is a just canonical example of freedom of speech and you don't have a right to privacy if you're out in public. So it kind of falls into your category, David. The policy doesn't make the policy doesn't make any sense. Nobody even understands it.

It's very poorly rolled. It's a lot of goes, what? Look, you could have said a policy of listen. If you have a non-public person being harassed, you can always take down basically unauthorized footage of that person. It could have been a harassment policy. Instead, they just banned all public video footage.

And you know it's going to be applied selectively. Here's my problem with this disinformation argument, okay? Is where are the warning labels or the banning of tweets basically describing cowwritten house as a white supremacist cross-street lines within AR-15? That is not true, okay? But that message went viral on Twitter.

The steel dossier went viral on Twitter, and yet there are no warning, hold on a second, there are no warning labels to the state, despite the fact that that has been completely debunk. I'm not trying to defend any specific politician in particular, Jason. I know you think to solve about Trump. It's not. It's about the double standard, okay. These censorship principles only exist, so the employees of the company can censor one side of the debate that they don't agree with. You've got to admit that there is a ton of bias and one-sidedness in the way these principles are enforced. I agree. There's bias. I agree that these companies are 70, 80 percent Democrat. I agree. They all have significant issues around Trump

arrangement syndrome. We got to go. Chamoff has had to leave the building, he had to go on to his next meeting, four, the dictator, the Queen of Kenwa, Sultan of science, and the Rayman David Sacks, so I'm going to go get a Cuban sandwich with right now that we're both going to look at and poke around

and take two bites of so we can say, Shfeldt, my guy, the Rayman David Sacks. We'll see you all next time. Bye bye. Bye. We'll let your winners ride. Rayman David sex.

I'm going on. And it says we open source it to the fans. And they've just gone crazy with it. I'm the West. I swing up. I'm going on. I'm going on. I'm going on.

What? What? What are winners? I'm going on. I'm going on. Besties are gone. I'm going on a leave What? What? What? What? What? Besties are gone That's my dog Can you give it a wish?

You're driving away Oh man, I'm a disaster when we be at police station We should all just get a room and just have one big hug or something It's like this sexual tension that we just need to release that out. I'm going on with it