Breaking Points with Krystal and Saagar - Best of Week 3/28 - 4/1: Regime Change, Hunter's Dealings, Wall St Rigging, GOP Agenda, CNN+ Launch, & More!

Episode Date: April 1, 2022

Krystal and Saagar's top stories of this week from Biden's declaration of support for regime change in Russia to the corruption of Hunter Biden and the launch of CNN+, here is a roundup of the biggest Breaking Points coverage!To become a Breaking Points Premium Member and watch/listen to the show uncut and 1 hour early visit: https://breakingpoints.supercast.com/To listen to Breaking Points as a podcast, check them out on Apple and SpotifyApple: https://podcasts.apple.com/us/podcast/breaking-points-with-krystal-and-saagar/id1570045623 Spotify: https://open.spotify.com/show/4Kbsy61zJSzPxNZZ3PKbXl Merch: https://breaking-points.myshopify.com/ Learn more about your ad choices. Visit megaphone.fm/adchoicesSee omnystudio.com/listener for privacy information.

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in American history. So what are you waiting for? Go to breakingpoints.com to help us out. But we want to start with those comments from the president when he was overseas in Europe. So in addition to calling Putin a butcher, he ad-libbed a comment that seemed to imply the U.S. had a potential policy of regime change in Russia. Let's take a listen to both of those moments. And you're, you know, you're dealing every day with Vladimir Putin. Look at what he's done to these people. What does it make you think? He's a butcher.

Did you make additional commitments? Thank you, guys. Thank you, guys. thank you guys thank you thank you for god's sake this man cannot remain in power god bless you all and may god defend our freedom and may god protect our troops thank you for your patience. Thank you. Thank you. So he ad-libs there, this man cannot remain in power. Now, this feeds directly into Putin's own propaganda that the real goal here of the U.S. is regime change. And of course, given our track record of regime change around the world, that is less of a crazy thing to imagine than you might think. Add on top of that the fact that you have aides, as we discussed last week, who are saying at private events, you know, the only

end game here really is Putin out of power. And you start to create a narrative of what is really going on behind the scenes in terms of the discussion that high-level officials are having about how they actually think this will all end. Because what have we been talking about? You have to create the conditions for peace. You have to create an off-ramp. You have to create pressure so that there are negotiations. Instead, all we've had is escalation, making it much more difficult for this thing ultimately to be resolved in negotiations, which are going to be painful and which are going to be difficult. How are you going to welcome back

into the community of nations someone who you have said is a butcher and a war criminal and who you have gone out and publicly said you want to see out of power, that he, quote, cannot remain in power? Well, the White House clearly knows what a problem this ad lib statement ultimately was, kind of giving up the game of what the Biden administration is actually wanting. And we're not saying like tanks on the ground in Russia, but the economic sanctions and the pressure being put on the state in a foolish hope and naive hope that this is ultimately going to push Putin out of power. So here's the White House statement immediately backtracking, trying to spin this, saying the president's point was that Putin cannot be allowed to exercise power over his neighbors or the region. He was not

discussing Putin's power in Russia or regime change. Listen, we all heard what he was saying. And again, this isn't the first time that word has slipped out from this administration that what they really think the endgame here should be should be Putin out of power. This only strengthens Vladimir Putin's hand domestically and makes escalation and more brutality and more death more likely. Yeah, that's right. And look, we are not about placating Putin. What we're talking about is mitigating the risk of a nuclear exchange. I don't know how many times I have to reiterate it here. I'm not a genius. It is written in Russian nuclear doctrine, as reiterated by Dmitry Peskov, the spokesperson for the Kremlin, that they will and have the option to launch nuclear weapons in the event of a threat to the direct power of the Putin regime. This goes all the way back to the days of the Soviet Union.

This is incredibly, incredibly destabilizing. And also, the word butcher in particular. Let's remember, when's the last time that we started using butcher against a despot in order to launch a war crystal? Saddam Hussein, the butcher of Baghdad. That's exactly what the Bush administration said over and over again.

Saddam Hussein, he's a butcher. Look, that's true. I mean, that's empirically true. Was it worth the Iraq war? I'll let you be the judge and the decider of that one. I personally would say the other way. That's why I think that these comments are so clearly reveal both the quiet part out loud of what the Biden administration is thinking, but also the worst of all worlds, because now he said it and then they pull it back. So now we're in this weird strategic ambiguity.

We're like, what is happening? What is the policy of the United States? And it happens at the same time that there was a very odd clip in which Biden was speaking to the 82nd Airborne Division, some guys who are about to deploy over to Europe, intimating that they may be deployed to Ukraine. We have a little bit of video from that. Let's take a listen. And you're going to see when you're there, some of you have been there, you're going to see women, young people, standing in the middle of the front of a damn tank, just saying, I'm not leaving. I'm holding my ground. They're incredible. What is he saying?

I mean, is it a senior moment? They tried to clean it up, saying, oh, he's talking about refugees. Is he? I mean, is it a senior moment? They tried to clean it up saying, oh, he's talking about refugees. And I was like, is he? I mean, what's happening here? You're talking there to members of the U.S. armed forces who are deploying over there. You combine that with an explicit declaration of regime change from the president of the United States. I mean, these are real things that have real consequences validating the worst fears of the Putin regime. This could very much be the pretext of which they completely break off relations between us. How are we supposed to have any diplomatic resolution at this point? Now, you might say, oh, you guys are playing into the

Russian hands. It's not about being soft or even about strength in this particular key. It's what's the strategy? What is the end game? And if the end game from the administration, as Neil Ferguson has been writing, is a de facto policy of regime change and a complete rejection of Vladimir Putin's regime from the community of nations for all time, then what incentive do the Russians have in order to stop the war in Ukraine? I would remind everyone, Zelensky, President Zelensky did an interview last night with Russian journalists where he said, we are, quote, ready to discuss neutrality. There is an off-ramp in Ukraine. Zelensky is ready, opening, talking about NATO, talking about neutrality,

said he's not going to leave, and opening the door to peace talks. But the West, as it was from the very beginning, is making it very, very difficult for the situation on the ground there to come to any sort of resolution before hundreds of thousands of people die. Well, and what Putin has been telling his people, this is the propaganda coming from the Kremlin, is they want to destroy Russia. They're going to levy sanctions and they're not going to go away no matter what. And so when our president makes comments like these, you are just validating the narrative that Vladimir Putin has been selling to his people. And you only strengthen his hand and make it even less likely that he ultimately is going to be removed from power.

I think it's incredibly foolish and naive to think that there is anything close to the conditions to seeing the end of the Putin regime. Yes. So if this is indeed their calculation, they're a bunch of fools and idiots. Right. Because that is nowhere close to happening. So all you've done is you've made it so much more difficult to see the end, see any kind of a resolution to the current war. You've made it much more likely that you could ultimately have an escalation outside of Ukraine that leads to a hot war, that leads to a confrontation, a direct military

confrontation between two nuclear powers. Look, do we want to see Putin out of power? Of course we do. Of course we do. He is guilty of all the crimes that he is being accused of. No one is saying otherwise. But when you're president of the United States, this is a different deal. And your words really matter. I seem to recall Joe Biden talking about exactly that. The words of a president matter. When he was running for president. I mean, it is a sort of Trumpian just like off the cuff, like saying whatever happens to stumble into your brain at that moment without any consideration of what the impact and the ramifications are ultimately going to be. There was a quote from,

you know, this isn't just like our thinking. There are a lot of sort of mainstream experts in this town who were very distressed by these comments. The Washington Post had a quote from Michael O'Hanlon. He's a senior fellow at the Brookings Institution. He said that he was trying to run cover for him, but he said Biden's head wouldn't be in a place where he's saying Putin must go. The only way to get to war termination is to negotiate with this guy. And when you say this guy must go, you've essentially declared you're not going to do business with him. However appealing at an emotional level, it's not going to happen. We can't control it and it probably won't take place anytime soon. How are you going to do business with this person? How are you going to have negotiations? How are you going to roll back sanctions when you've said

he's a butcher, he's a war criminal, and that his reign in power must end? Yeah, and how are our allies reacting? Not great. Let's put this up there on the screen. President Macron doing his best to say, let's not have, quote, escalation after Biden brands Putin a butcher. The French leader told broadcaster France 3 he saw his task as achieving first a ceasefire and then the total withdrawal of Russian troops by diplomatic means. Quote, if we want to do that, we can't escalate either in words or in action. So the actual diplomat on the European continent, the people with all a lot at stake here, are not too happy with President Biden's comments. So Biden clearly got taken in at the emotional moment of being there and seeing the refugees. And look, I think that's a good thing for the president to go and see those people. But you're also supposed to keep

a level head and keep all of us safe here at home. So there is no way to describe this other than a complete diplomatic catastrophe, the likes of the ramifications of which we are only beginning to see. The Kremlin is obviously going to react in its most maximalist way possible. This is the best thing that could have ever happened to Russian propaganda. This is going to absolutely hurt any peace efforts between Russia and with Ukraine. And he has made us all significantly less safe. I mean, look, everybody says, oh, people are fear-mongering around a nuclear confrontation. Once again, if the chance is 1%, that's way too high. And I think it's a lot more than 1% given the state of these comments, given the ability

for escalation to occur. I don't know what he's talking about there with the 82nd Airborne. You know, there's a lot of reporting about what's happening in Poland at these bases in terms of military assets and stuff being, you know, moved forward. I'm not saying that they're gonna be moving into Ukraine, but what are they doing? What's happening?

I mean, these are all things which can go awry very quickly. Don't listen to me. Listen to the generals who we have quoted here before, who've even said, look, you have young guys and these pilots and the ramifications of these things can escalate significantly. All it takes is one person accidentally fly across the border for two seconds, gets shot down. Now we're in a whole other situation. And how are we supposed to talk to each other if you branded the

man a butcher and you said that he shouldn't remain in power? This is exactly the rhetorical conditions which led to the invasion of Iraq. And I think we should all be very, very skeptical and not just skeptical, but we should really be afraid and caution our government officials from using this type of language, given what has happened to our country in the most recent memory of the last time these people were in charge. One of the selling points of Biden during the campaign was like, the grownups are going to be back. The adults are going to be back in the room. We're going to handle things. We're going to do it in a measured and strategic way. And so when you just off the cuff, I mean, we've had a couple of different moments now. We didn't even talk about, you know, he got asked about, okay, what if they,

what if there's a chemical weapons attack? And he says, we'll respond in kind. What? Are you floating chemical weapons attack on Russia? Again, they had to clean it up. Of course, he's not floating that. Of course, that's not what he meant. But how can you have one after another of these comments that the last thing you want to do is back Putin into a corner where he feels that his only option is to escalate, that there is no off-ramp that doesn't involve him out of power or complete and total humiliation. Because that's the disaster scenario we all have to be doing everything we can to try to avoid. When you

openly float regime change, you are making that outcome that much more likely. And it is just pure catastrophe. Yeah, the nightmare scenario, what we talked about on our Thursday show, is that the Russians use some sort of small tactical nuclear weapon. And when I say small, I just mean hundreds of thousands, not millions of people who are dead, not actually small. And then, you know, the U.S., which has already said, a senior administration official that, quote, all gloves are off. If that happens, we don't actually have a treaty obligation to do so. So there would be a huge split in the global community. It would shatter all of the conventions around the use of weapons themselves. And the next thing you know, you end up in a very messy

conflict with the US population and the global population split on what exactly should do and hundreds of millions of people could die. I mean, once again, it's unlikely, but it's certainly within the realm of possibility. And he's making that even more likely. There's a reason that we treat all of the language around these things with extreme caution. And I actually, worse, I don't think this is a senior moment for Biden. This is who he is. This is Mr. They're going to put you back in chains. Mr. Gaff for the, you know, for the, his, the entirety of his career, this is the man. This is exactly who he is. If you go and you read about him all the way back from the 1970s and the 1980s, he has an extreme narcissistic faith in his own ability in order to read the moment,

read the room, doesn't care what his aides think, and hates the media for criticizing him. And it's because of that that he has now put us all in a much more dangerous situation as president. So I really, that's the only way we can hope to much more dangerous situation as president. So I really, that's the only way we can hope to describe it at this point. All he had to do was freaking read the speech on the teleprompter. Like, that's it. Is that so hard? Just like read the freaking speech off the teleprompter. This is another significant one that I wanted to bring attention to. A key indicator that has predicted recessions consistently since the 1970s is now once again signaling we might be headed towards a recession. However, there are some

caveats. I don't want people to panic yet. Go ahead and put this up on the screen. Five-year and 30-year treasury yields invert for the first time since 2006, fueling recession fears. I don't know if you guys have heard this term before, but oftentimes people talk about inverted bond yields. Basically, to make this as simple as possible, typically the further you go out on the time horizon, the higher return you're going to get. This is basic time value of money. If you're willing to hold an instrument for a long time, you're rewarded with a higher interest rate. That's sort of the typical bond yield. And we're talking about US Treasury bonds here specifically. So when things are out of whack and investors are very worried about the longer term prospects for an economy, then sometimes you

get funky situations in the bond yield curve where it doesn't just consistently go up over time. They call that an inverted bond yield. Now, usually, when you're thinking about recessions, the ones that investors usually look at are the two and the 10-year bond yields. Those have not inverted yet, although there has been significant flattening across the entire curve. Right now, it is the five-year and 30-year bond yields that have inverted. So if you understand nothing else, just know that this metric signals that the economy is out of whack and people are concerned about the future. That's basically what this means. The history is also quite clear. So the two and 10 year treasury yield curves, that's the one that I just said people typically look at

that hasn't inverted yet, but is a lot of flattening. Those inverted before the last seven recessions since 1970. However, the data also suggests a recession is unlikely to be imminent when you do have a bond yield curve inversion. It took 17 months after the bond market inversion for a downturn to start on average. On the flip side, there has been at least one, some would say two, false alarms where the bond yield curve inverted and you did not end up in a recession. The one that they're very consistent and clear about is 1998. The other caveat that I'll put on this, but that people who are way smarter and understand this way more than I do, we're saying is that it's not clear how much information

these bond yields contain anymore because the Fed has gone into the market and is so influential in the market at this point. It's effectively, it's not really a free market anymore. It's effectively sort of rigged. So how much information does this really contain about how investors feel about the future of the economy and the shape of where we're headed in terms of recession? Hard to say at this point. But again, this is a

key metric. It has consistently had predictive power in terms of whether you're going to head into a recession over the next year and a half or so. And right now, it has inverted for the first time since 2006. Right. And I believe the Federal Reserve Chairman, he was pressed on this in Congress. Let's take a listen. Is the leadership at the Fed under you and the Fed prepared to do what it takes to get inflation under control and protect price stability? Well, let me say I knew Paul Volcker. I'm pretty sure I saw him testify in this room many years ago. I think he was one of the great public servants of the era, the greatest economic public servant of the era. And I hope history will record

that the answer to your question is yes. So you're prepared to do what it takes without any reservation to protect price stability? Yes. That would be a departure of what you've done. Thank you very much. So this was Fed Chair Jerome Powell getting pressed on how serious he's going to be at getting inflation under control. And why this is relevant is because obviously the Fed, they just announced their first rate increase.

And there's worry that they could move too quickly, lift the rates too fast in an effort to get inflation under control and spark a recession. What he's saying there, he's like, oh, my God, I love Paul Volcker. He's amazing. He's a hero. He's a role model. Volcker is the sort of storied Fed Reserve chair who aggressively raised rates during the 70s to curb inflation at that point. And so Powell is saying, this is my model. I'm going to do what it takes to focus on prices and get inflation under control. And the subtext is, even if it causes a really brutal recession, because while at this point everyone says, oh, Volcker did the right thing, it's easy to forget how painful it was at the time. The 70s is horrible. Yeah, because when you lift interest rates, what you're doing is you're intentionally slowing down the economy. So he says, yes, I'm fully committed effectively to getting inflation under control, even if it causes a recession, is kind of the subtext

of what he is saying there. Now, the actions have not necessarily been totally consistent with that. They were under some pressure to lift rates more, to do so more quickly, to act before they even did. And so there's been an attempt to be sort of like moderated in their actions here. So we haven't seen that spark a recession right now, but you have more and more analysts who fear that we could be headed in that direction. Yeah. My authority on this is Joe Weisenthal over at Bloomberg. I really look to him on a lot of this. And it seems to be that there's been a split the difference approach at the Fed. The Fed has a dual mandate, full employment and inflation. Now, inflation is what obviously people in the upper tier care the most

about. I'm not erasing exactly how it impacts the working class, but I'm saying that it's generally more of an elite concern amongst conservatives and Republicans just because of the way it can affect markets up at the top and interest rates as well, which affects capital, which is what these people care the most about. And in terms of what's happening there is that there's an immense amount of pressure in order to do something about inflation. And that becomes then a question of what is the cause of inflation? Is it monetary policy? Or is it a supply chain problem and a problem in the downstream economy? Now, your view of those two things, I personally think it's much more the supply chain, will then lead you to whether you have the monetary instrument that you can reach for.

The only thing that they can reach for there in order to slow the economy down is increasing the interest rate. So their acceptance and saying they're going to increase the interest rate, at least in part right now and over the course of the next couple of years or so, is very much a bow in that direction, but they're not fully bowing to what, I guess, the most monetary hawks would like them to do. People like Richard Shelby there. People like Richard Shelby is a perfect example. He's the chair of the Senate Banking Committee, so I think the ranking member of the Senate Banking Committee next to be the chair, so obviously he matters a lot. He was instrumental in COVID relief in not necessarily great ways, committee. So I think the ranking member of the Senate Banking Committee next to be the chair,

so obviously he matters a lot. He was instrumental in COVID relief in not necessarily great ways. The reason why it matters for you is because if the interest rate goes up and there is a recession cause, which then causes the amount of cheap capital in order to stop flowing around the system, the rich people will suffer in terms of the stock portfolios, but you're the one who's going to lose your job. And you're the one who's going to see downward pressure, especially under wages. But even worse, you're going to see it in terms of the supply problems that already exist within the economy whenever it comes to price. So I would just say that this is a real catastrophe. Anytime I see, and I don't mean the Fed changing rates necessarily, I'm just saying the current situation, the arrow is pointing in the wrong direction. I'm just saying the current situation, the arrow is

pointing in the wrong direction. I'm doing my monologue today on China and its COVID zero policy causing even more inflation. The amount of uncertainty right now in the global economy just makes me incredibly, incredibly nervous. It's very like 2007 vibes about what could be happening here. I think that's all well said. And what you're pointing to is that in an ideal functioning political system, you would have a range of tools available to deal with the type of inflation we're experiencing right now, which does have a lot to do with supply chain issues, with the fact that we had relief checks hit people's pockets, and they weren't able to fully partake in like the service economy. So there's more purchasing of goods. There are some signs that some of those factors are beginning to ease, even as you have other catastrophic situations unfolding that are only exacerbating

things. So in an ideal and perfect system, you would have a political system that could actually like pass legislation and spend money to deal with the supply chain issue. And I don't mean by just like, you know, giving people more money. I mean, by investing in the infrastructure, expanding port capabilities to try to resolve these supply chain issues, that would be the ideal system. Well, since the political system is so broken, the only tool that's effectively left is this sort of like blunt force instrument of the Fed, which, I mean, we basically know in no uncertain terms if they move too fast, it will cause a recession. So that's the terrible landscape that we are faced with right now. And I feel like every week there's another sign that potentially we are headed in that direction with the bond yield curve inversion here just being the latest one.

There's a new HBO Max documentary that happens to feature a little bit of yours truly, but that's not the reason to talk about it. It's called Gaming Wall Street, and it tracks the entire GameStop situation and attempts to sort of push back on Wall Street hedge funds and the titans who normally run everything, both on Wall Street and, frankly, in the country at large. And we're happy to be joined now by the producer of that documentary. Tobias Demel joins us now.

Great to see you, Tobias. Good to see you, man. Hey, great to be here. So we've got a little bit of the trailer from Gaming Wall Street. Let's take a look at that. Never seen a, hear a group of stocks that you can no longer add to. There is a lot of emotion here. All of this rage.

Definitely the worst point in my life. What can we do to give a voice to it? The GameStop frenzy ripped the curtain of how great our markets really are. They forced the broader public to start asking questions that they've never really asked before. And it's not just one firm, two firms, three firms. It's all the firms that commit capital. And that cracked open a whole investigation. Wall Street has been making money out of thin air. So that's basically stealing, right? The level of illegal activity is just astonishing.

The market does get manipulated in a lot of ways that we don't see. How do you play a game when someone else makes the rules? Someone can cheat and you'll never know. It's intentionally hidden from you that you can't see where the problem's really lying. This is our one chance to blow up the Death Star. I don't even care who the whistleblower is. That's why it's important that people come forward. This is just the beginning. So Tobias, as a filmmaker, what was it about this story and what happened with GameStop that you thought would be compelling for an audience?

That's a great question. So I started this actually as a niche documentary about Wall Street bets and this crazy little world online where all these people were having their own investing journey and just simplifying very, very complicated finance topics. And it was one of my entry points to learning about investing. My dad has a long activism investor, ESG kind of background, and I always kind of felt stupid. And so finally, during the pandemic, I had time like millions of others who just got interested in investing. And then, you know, I was like, oh, this is this great online community.

And suddenly GameStop is one of the crazy things in Wall Street Bets that just blows up and becomes the number one headline. And so we knew that we had to do the doc right then. But as we kept going, we just kept going deeper and deeper into this wild world of Wall Street. And yeah, so that was much more compelling stuff

once we started actually working on it. Yeah, I think the most important part about your film is when you actually interview a lot of the people on Wall Street and how they saw it as a commentary itself. Can you describe that for the audience and just like what exactly you found at the bottom of that? Yeah, so the deeper we went, the more we started kind of asking these really important questions. So we partnered up with Biltmore Films. And I, as a director, I needed to get real experts on the producing team. So my producer, Tessa, who's been there from day zero, she's a great storyteller and knows a lot about the human stories and the sort of big picture

components. But we wanted to really make sure that we would tell this super accurate and deeply researched story. So we teamed up with Biltmore Films, who was run by a hedge fund manager, John Fichthorn, and a securities analyst, Burke Koontz. So John and Burke, they really know what's up on Wall Street and have all these insider connections. And so I said, look, there's all these conspiracy theories on Reddit, like this crazy, like, naked chart selling. It's definitely like bullshit, right? And they're like, no, it's actually totally real. And the more that we started really digging into it, the more I started realizing how fragile the system is and how easy it is for certain players.

Like you said, the titans that usually run the show, how easy it is for them to actually abuse the rules and the system that they've sort of helped construct. And so that was one of the biggest takeaways is that some of these things are so far beyond the surface that you really have to go dig. You have to expose it and then you have to kind of, you know, put the responsibility on the regulators and the larger forces to be to actually correct this. Yeah. Yeah, I mean, that's what was so compelling, both at the time watching this all unfold and also watching your documentary, is you had this moment where it seemed like it was actually working. Like, you had this sort this sort of like mass distributed movement of people who were like, screw you. You all rig the system all the time.

We're going to make this play. We're in it. We're doing it. It's happening. The price of GameStop, which is like, you know, not really poised for great success in the future probably,

continues to go up and up and up. That's probably going to be controversial. Yes, people are going to get mad. Up and up and up, right? Not exactly what you would think as like the stock of the future. Let's just put it that way. And then what happens? Robinhood app, which is what has enabled all these retail investors to be able to sort of get in the game and make these trades, they've got relationships with these hedge funds and they decide that they're going to stop allowing people to buy just this handful of sort of meme stocks, right? You're still allowed to sell them, so you're allowed to put

downward pressure on the price, but you're not allowed to buy them anymore. And frankly, it worked. Part of what's heartbreaking about the film is that you interview some of the people who really, you know, they lost money that was significant to them. And these were oftentimes people who'd already been fucked over by our financial system during the housing crisis, who had lost homes or lived through their parents losing their homes and being foreclosed on. And here they thought this is one little way to, you know, push back on this rigged system and say, screw you to Wall Street. And in the end, the big guy still won.

Yeah, this was one of the interesting takeaways, right? That as we go deeper into the story, you have the brokers like Robinhood that shut down, right? And as we peel back the layers, like, why did they shut down, right? There's a bunch of different possibilities what might have also happened, right? These additional interests. But the primary thing was really the DTCC, the sort of central plumbing system saying, look, you've got to pay $3 billion. But they knew ahead of time that Robinhood would not have that money. They could totally predict what the situation was going to be. And there's a responsible way to say, hey, we have a real big problem in the market.

Let's talk with the SEC. Let's talk with the markets and figure out what's going on. But instead, the DTCC sort of said, you're on your own, let's just see what happens. And I think that's one of these things in the system, right? Who are these different players? The DTCC is a privately owned corporation. It runs the entire system. There's very little accounting and transparency there to the outside world. And we talked to Harvey Pitt, former chairman of the SEC, and one of his sort of striking quotes is, you know, the DTCC is so powerful and so centralized, and there's so little insight. And he used to run the SEC, the regulator himself, right? And so there's a lot of pieces to

the system that need reform. That's one of the sort of biggest takeaways. And then the individual people who got screwed really by the buy button being shut off, it helped certain players that this buy button was off, right? There were certain players like Citadel that were very likely exposed very strongly to the short side and possibly survived only because of this shutdown. And that part of the story has never been told, has never been properly investigated, right? The SEC report did never go into that. And so with the documentary, we went into all of these questions. We said, what happened to Melvin Capital's position? They got out of the stock, but what does this really mean?

And so there's all these fascinating stories of what Melvin did with their position, what happened at Citadel. And so we tried to shine a light on all of that. Yeah, I think that's what is the most important thing, at least I learned. I think it was an opening for a lot of people, which I always tried to emphasize. I was like, look, it's free to trade, but that just means that you're not the customer,

you are the product. People are upselling and front running your trades who are big guys and they're making a whole lot more money than you actually are. So what do you think the takeaway was for the average Redditor, Wall Street, you know, kind of Wall Street bets person? I've been a Redditor for like, you know, 12 years or something like that. It was kind of natural for me to, that's why I saw this bubbling up early, I think. But I'm curious what the

feeling and the takeaway was for a lot of those people who you talked to as well. For many of them, it was, I think, their first real experience at seeing market structure in play. And I think for many people on Wall Street, it was that experience as well, right? You can work on Wall Street for 20 years. Nobody's ever seen that, right? Like John says in the documentary, you know, he's never seen a basket of stocks just being taken away on the, you can no longer add to that position. And I think for many people, you started seeing, and I think Dennis Keller puts this great,, it like rips the curtain off the system. And it shows you all the dirty gears and wheels in the back and who is making decisions and why. And I think for many people, it was an incredibly

frustrating experience. But if we take one step further back, I think what it truly represented was a show of power and a show of force by the retail crowd, right? By the individual people who said, I will stand up against the system that screwed me in 2008 and a system that pretends or believes that they're all powerful. But in this one instance, we put this tiny bit of pressure on this one little stock or this group of stocks, AMC, GME, and so on. And suddenly the entire market goes bananas. And I think that was ridiculed by a lot of the larger media outlets. Oh, there's just a bunch of crazy people online. This was the first

instance where the system really saw, hey, we can't screw around with those people, right? Like these people will have power and that power is only going to increase from here on out, right? It's all about literacy. The more that you know about the system, the more that you know how to interact with the system, the more you can hold it accountable. And this, in a really strange way, was a way to hold Wall Street accountable and say, hey, don't screw around with us one more time because we're here and we kind of know how your system works now. Yeah. Well, there were people on Wall Street who did take losses because of their short position. So it's not like it worked out all rosy for them, but ultimately they weren't in position to absorb those losses. I mean, I think that's ultimately the sort of the moral

of the story or what was revealed is there's all this mythology around like, oh, it's the free market and these stock values, or they just represent like the intrinsic value of this company. That's all bullshit. You know, I mean, it's all fake. It's very much rigged and manipulated. But the moment that it was like regular people who tried to get in on the game, well, they had to bring the hammer down and make sure that you can never, ever have that happen.

So ultimately, it was all extraordinarily revealing of how things actually work. Absolutely. Yeah, and it showed, I think, the weaknesses in the system, right? And the biggest loopholes. And I think that's all what this is about, right? It's all about loopholes and exploiting loopholes. The short-selling mechanism is very easy to abuse by the largest players in the world, right?

And I think one of the ironic things is a lot of people got ridiculed for saying, oh, you know, we'll stick it to the hedge funds because of 2008. And then people said, well, it wasn't the hedge funds in 2008. It was all the large investment banks. But the real joke of the story is that this practice of naked short selling and many of the other ways of abusing the short selling mechanism actually doesn't happen at the short seller or the hedge fund. It happens earlier at the prime broker, which just happens to be all the largest investment banks in the world. And so this basket of six companies that basically runs the U.S. financial markets, they are yet again, in a way, indirectly at fault for some of these things that happened and have not been held accountable properly. They have not been held accountable in 2008 properly. They still have not been held accountable now.

And one of the things that I think is really important from a sort of national security level is that a market needs to be trustworthy, right? And so if the main reputation of the US stock market is that it's a rigged system, a lot of regulators should scratch their head and be like, hey, we really got to do something and we're going to show some signal to the greater public,

hey, we will actually go after those people, right? And sometimes it's not the SEC, sometimes it's the DOJ. But it's important that there needs to be a new system of checks and balances on Wall Street that is currently not really there, which is namely jail time for individual people, right? If you betrayed a system, if you make a short sale,

if you use the mechanisms in a way that is not intended and that is illicitly extracting profits from the system, you should face at least the consequences to your own personal liberty. Yeah, I think that's really well said. Really enjoyed the film. I encourage everybody to go and watch it. We really appreciate you joining us, man.

Yeah, great to have you, Tobias. Thank you. Thanks for having me. Absolutely. As we've covered before, Senator Rick Scott of Florida just can't help himself. He's put out a new plan in order to try and win the election in the midterms. And that plan entails literally taxing poor people. The plan is so absurd and obviously such a political detriment

that even Fox News is incredulous at his spin. Let's take a listen. Recently put out an 11-point plan to rescue America. Two of the big points of which are, quote, all Americans should pay some income tax to have skin in the game, even if a small amount. Currently, over half of Americans pay no income tax. It also says all federal legislation sunsets in five years. If a law is worth keeping, Congress can pass it again. So that would raise taxes on half of Americans and potentially sunset programs like Medicare, Medicaid and Social Security. Why would you propose something like that in an election year?

Sure. Well, John, that's, of course, the Democrat talking points. It's a plan. It's in the plan. But here's the thing about reality for a second. First of all, let's talk about Medicare. But Senator, hang on. It's not a Democratic talking point. It's in the plan. And also in the plan, it says we ought to every year talk about exactly how we're going to fix Medicare. Oh, my God. It's in the plan, Senator. And he's right about that. Let's put this up there on the screen. Per an interview that Scott gave to his own Florida politics outlet, he said it's, quote, unfair that poor people don't pay income dude, this is too far. We don't support this.

This is not the official Republican position, even though it's the de facto Republican position. They support it. They just are like, why are you talking about it? Why are you talking the quiet part out loud? Why are you giving up the game here, bro? What are you saying? And Henry Olsen, he's a columnist who I actually respect a lot, you know, really into working class politics and all that. But he's giving some very practical advice to the GOP. Let's put this up there from the Washington Post. House Republicans would only hurt themselves by releasing a detailed midterm agenda. And here's the thing. He's totally right. 100%. Which is that a lot of Republicans do actually believe this. They do believe it's unfair that

poor people don't pay any income tax, even though they pay a myriad of other taxes. And if you look at their actual percentage base of income that they pay is outrageous. Also, God, I've been meaning to cover this. Maybe I'll do some evergreen monologue, but that whole report that just came out this year that people who make less than $20,000 were five times more likely to be audited than billionaires and anybody else. Five times more likely to be audited when you make less than $20,000. So you're talking about the poorest Americans are the easiest ones to be audited because they're not reporting their barbershop income or their service base. Yeah, nail tips or whatever.

Yeah, okay. Go after carried interests and all that. Once you exhaust all the richest people in the world, then maybe, maybe we can talk about the guy who gets paid in cash and doesn't report his tips because he's trying to pay his rent and is struggling to pay his bills. Maybe we can have that conversation. But instead, it's completely flipped.

You know, this whole Venmo thing, the going after people's Venmo transactions. It makes me infuriated to think about it. This is classic GOP talking points. I mean, this is Mitt Romney, 47%. At that time, I don't know if y'all were watching Fox News, but I was actually doing a lot of Fox News hits during that era. Yeah, what was it like? I mean, I was in college, so I didn't fully, you know. Yeah, and this was a consistent talking point about how half of America doesn't pay any taxes and it's really the rich. They're the makers. I mean, this is the Paul Ryan. Yeah, this is the Paul Ryan era of talking

about the makers and takers and how and Mitt Romney and those very revealing comments talking about how 47 percent of people are never going to care for themselves and there's no winning them and all of that stuff. They're never going to better themselves. I think that was the language that he ultimately used. That all comes from what Rick Scott is saying right here. They literally lost the presidential election in part because Mitt Romney says this cartoonishly villainous thing that is completely contemptible and also incredibly misleading because as you point out, people who are lower income pay a lot of different taxes. Much higher percentage of their income ultimately goes to taxes than certainly the very top. This was rejected by the American people thoroughly in 2012.

Trump, although he governs in exactly the same way and gives a corporate tax cut, is politically smart enough to understand this is a disaster, takes entitlements off the table. This was also a longstanding discussion in the Republican Party, George W. Bush, efforts to privatize Social Security, all of this stuff, totally rejected by the American people. And here comes Rick Scott like,

you know what we should do? If we get power again, let's raise taxes on half the country. How about we sunset programs like Medicare and Social Security after five years? How about we have a conversation every year about how we're going to, quote, fix these programs? Well, most Americans think the only fix that needs happening to those programs is for them to be more generous to support people

more effectively. So, yeah, Mitch McConnell and the other strategists who are like, we're better off just not telling people what we actually want to do. They are 100 percent right. Democrats are handing the election to them. All they have to do is stay silent. And yet Rick Scott can't help him. He just can't help himself. And this is always the problem with these types of politicians.

Rick Scott bought himself the governorship. He's worth like $100 million. Has some sketchy business practices in his past. Bought himself the Florida Senate. He's really not that talented of a politician. I mean, he visited Puerto Rico a bunch of times, apparently that qualifies you, in order to be the next senator. And look, he basically has a hold there on the Florida political machine because of an

immense amount of his money. And just look at him. The guy's literally a clown in terms of the way he conducts himself. But this is just an exact and perfect view into, he is the ideology of the mainstream of the Republican senator. Not necessarily of the Republican party, but in terms of what the mean Republican senator believes. That's it right there. They actually think this stuff.

They're just too afraid to say it out loud. There are decades of infrastructure and research and apparatus just waiting. I mean, that's why the one thing Trump gets accomplished when he's in office is his tax reform that ultimately cuts taxes for the rich. Because that's what their entire movement is set up economically to ultimately sort of churn out. I just found this news article. This is kind of interesting. According to Playbook, Trump is trying to recruit Rick Scott to be majority leader, which also shows you, I don't know if this is actually going to happen or a real thing, but he hates Mitch McConnell so much just based on stop the steal. That's the only thing that matters. So if ever you wanted to,

even for a split second, delude yourself that there was some other policy platform involved, I think this should dissuade you from that view. That's a great point. This is a fun one. Basically, the media two years later has decided, OK, now it's time to acknowledge the Hunter Biden laptop is real. I suspect, and I think you do too, it's because the federal grand jury is hearing these cases very seriously, and he might actually be criminally indicted. Yeah, they can't deny it anymore. So they can't deny it anymore, so they've got to get out ahead of it a little bit. Because the Biden Justice Department has now validated the laptop, so they can't play dumb anymore.

They can't play dumb anymore. So now everybody's like, oh, actually, you know that laptop that we all said was fake? Oh, yeah, that's actually totally real. So let's go ahead and put this up there on the screen. This is from The Washington Post. So there's a lot going on here. The Washington Post says inside Hunter Biden's multimillion dollar deals with the Chinese energy company. confirms key details and offers new documentation of Biden family interactions with Chinese executive. And what they point to specifically is on August 2nd, 2017, signatures were quickly affixed from Hunter Biden and Chinese executive Gong Wendong. And within days, a new Cathay bank account was created. Within a week, millions of dollars started to change hands. However, within a year, it would all begin to collapse. What they point to is a previously known, and we will get to that,

deal between Hunter Biden and the CEFC China Energy Corporations, which has direct ties to the Chinese Communist Party. That Chinese energy conglomerate paid $4.8 million to entities that were controlled by Hunter Biden and his uncle, James Biden, the brother of the president. Court documents and newly disclosed bank statements, as well as emails contained on a copy of a laptop hard drive that once belonged to Hunter Biden. And what they specifically point to is that Hunter Biden's laptop was confirmed by the Washington Post. Very interesting. You know, it was confirmed the day he didn't deny that it was his. OK, all the hallmarks of Russian disinformation, all the hallmarks.

This is the same outlet which ran these types of stories. And what they point to is that the CFC deal became one of the most lucrative, if short-lived, foreign ventures that Hunter is known to have pursued. The post-review draws in part on an analysis of the hard drive of the laptop computer. And I think that what is so important here is that this, is this the most important thing in the world? No. Okay. In terms of the evidence within the story, have they directly connected Joe Biden to that? No. Although you can go read that email from Tony Bobulinski around the big guy and specifically connected to a China deal. But here's the basic fact pattern. The president's son and the president's brother received millions

of dollars from the Chinese Communist Party and used those dollars in a slush fund. Oh, and also didn't pay any tax, allegedly, did not pay any of their taxes on any of this. That's pretty sketchy. Now, do you think that they did it out of the goodness of their heart that the Chinese Communist Party is wiring the former vice president's son and now current president's son all of this money? My personal favorite, Crystal, was whenever they did not pay his bills, Hunter actually threatened to sue them in Delaware court and specifically said, just so you know, I know all of the judges in Delaware. Yeah, because they questioned,

that little detail is funny too, because they questioned one of the expenses that he was trying to get reimbursed. Last show, we brought you how, you know, he was getting money that was for a car, for like $150,000 sports car. A Fisker car. Yeah, which I don't even really know what it is. That's how fancy it is. But, yeah, so he was clearly using this to fund an insanely lavish lifestyle, allegedly, according to some of the investigations with the grand jury, maybe not paying his taxes on some of those things, certainly getting behind on his taxes. And I think in terms of political relevance, it's very obvious here, guys, you don't need a direct connect to Joe Biden.

It's plain to see that James Biden and Hunter Biden were not getting these gigs and having these millions of dollars thrown at them because of their competence or expertise. It's all because of their last name. And that is blatant corruption. Did Joe Biden directly have anything to do with that? We don't know. We don't know. But as we talk about with corruption all the time, just the appearance of this type of corruption is so incredibly damaging, especially when, look, he's the president of the United States. Obviously, our relationship with China is extraordinarily significant. Obviously, our relationship with Ukraine now, extraordinarily significant. So these are no small things. As you said, is it the biggest story in the world? No,

but it actually is really pretty damn significant. And here's the other part of it that we have to point out, which is that, yeah, the Washington Post has a few new details here, putting some like, you know, meat on the bones of this story. Is this a new story? No, no, it's not. I mean, we knew the general outlines of what was going on here for a long time. And they just couldn't be bothered to actually dig in and do real reporting on what was going on until now when their hand is forced by the fact that he may be facing criminal liability and actually facing potential indictment over these things so they can no longer sit on their hands. There was a window in the past. Remember, we dug up some of the old stories from Politico and whatever that talked about Biden family corruption. 2019. So there was a time when it was on the table. Yeah. And then you had this whole long stretch where suddenly, because it was clear he

was likely to be a Democratic nominee. Oh, now you can't say anything. You had even his primary rivals, Bernie Sanders, Elizabeth Warren, and others, totally pulling their punches on insinuating any sort of corruption. Well, remember when Bernie, like, chastised and disciplined members of his campaign team and his surrogates, like Zephyr Teachout,

who wanted to go in the direction of talking about Biden corruption. The media, obviously, you know, was all ready to go and sort of like smear you as unfair and right wing and you love Trump if you brought any of this stuff up. Then they go and completely hide it in the general election. And it's disgraceful. So listen, none of this is particularly new, but it is significant to know that there were these big deals with significant players around the world who clearly, whatever they actually got,

they clearly thought they were getting access and influence. You guys have been waiting for us to talk about CNN+. We've been waiting as well. All right, so let's start with the most important part, which is the part that has to do with us. Has to concern us. Which is that, okay, we do not have anything to do with the ads that are placed on our podcast.

It's very similar to how things work on YouTube where they just insert ads. We do have some say over, like, we've told them, no fossil fuel, no pharma, no banks. That's right. So we do have some say over saying, like, absolutely these people cannot. But we did not include CNN Plus in that list of no-nos,

frankly, just because it didn't really occur to us. I never thought it would be an issue. Yeah. So according to you guys, and let's put this first element up on the screen, some of you are getting served CNN Plus ads at the beginning of Breaking Points on Spotify, which is hilarious because they are obviously too stupid to know that our audience is going to give them negative return and nothing but scorn for their money spent on our podcast. Our audience exists because they suck.

And so, as I put it here, if they want to help support the show in order to point out how awful they are, be my guest, okay, people? But it does show you that they are desperate. They are absolutely desperate in what is going on. That tiny little tidbit is, of course, absolutely hilarious. But in terms of the actual thing, the product has launched. So how's it going? Let's go ahead and put this next one up there on the screen. This is especially funny. Look at what they are doing, Crystal. They are doing the tried and true,

trying to juice their initial sign-up numbers to fake how many people they actually have. And as we're pointing out here, they are discounting the product to half its price, $2.99 a month, in order to try and induce as many people as possible to sign up. Save 50% for life. Save 50% for life.

Save 50% for life. The question is how long the life of CNN Plus is ultimately going to be. Exactly. And that's a really good point. And here's the thing. I went ahead and I read in Puck News last night that CNN Plus' initial projection is they need 2 million people to become subscribers in the first year. 5 million over three years. Forget it. And that is at these rock bottom fake prices. Here's the thing. If you have no

confidence in your product, this is not retail. This is content. Content is flat in terms of discounts and all that. We don't have to have sell through business. People know what I'm talking about. The way retail works is like you've discount, you know, off season sell through rates, inventory. This, that's not how this stuff works. The way it works here like you discount off-season, sell-through rates, inventory. That's not how this stuff works. The way it works here is if you have a product that you value, you sell it at a price that you think is fair. All of this discounting that's happening on their part, it shows you they have no confidence in their actual product. They're throwing it away in order to juice their initial sign-ups and then fake it to the advertising industry and say, see, we have X hundreds of thousands

of people who are signing up. Yeah, Pink, you're $2.99 a month. They had to hire hundreds of people. They have thrown so much money at this thing. Probably maybe millions. Because you think about, oh, absolutely. Because, well, first of all, and I'm going to get to,

we did not actually watch their content because there was no way in hell I'm giving them even $3 of my money. But somebody did and they did a review and we'll tell you about that

in a minute. But from the pictures of it, like the sets are really elaborate. Yes. I can tell you that's very expensive. We can tell you from our experience. Even though the talent

that they brought in shouldn't be expensive, it is. You know, Chris Wallace is a big get. They reportedly tried to get Rachel Maddow for like $20 million. She ends up staying at MSNBC. Apparently, they also tried to get Ari Melber, another primetime host over there who would have to be paid millions of dollars, I'm sure, to come over. He ultimately decided to stay where he was at MSNBC as well. You've got Casey Hunt. Some of these people that they acquired are not inexpensive. This is a lot of money to throw at talent, to throw at the technology, to throw at ads that

are going to be completely worthless to you on our podcast, to throw at the set. They have made a huge investment in this thing. And then to, on day one, have to mark it down to half price to come anywhere close to what your projections are. And by the way, I still don't think they're going to come anywhere close to what their projections are. And we have some reporting on that as well.

Because if you're saying they have to get to 5 million subscribers, that's like not that far shy of what the New York Times digital subscriptions is at. Actually, wow, that's completely correct. They're at 6.8 million based on what I just was looking up. So, you know, you're trying, and for all like New York Times fault, like obviously they have been intelligent about their digital offering.

In the news for 10 years. Yeah. Oh my God. When you put it that way, that's insane. So people are going to pay, 5 million people are going to pay for like an extra hour of Wolf Blitzer doing the same shit that he does for free on regular CNN? I cannot believe it. People are going to pay for Anderson Cooper's parenting tips or Jake Tapper's book show? Like, come on.

I mean, this is the most insane business attempt that I have ever seen. Here's another just like silliness of this. They're apparently selling the first moment as an NFT, which also, okay, so first just like cringe hilarious. They're going to sell the first 29 seconds of five things with Kate Baldwin will be sold at $50 each. So guys, if you're interested, you better hop to. I'm sure those things are flying right off the shelf. But, you know, the way that they talk about this internally is like, this is the most historic moment

since Ted Turner's launch of the network. That's how much they have invested in it. And it's just clearly a disaster. Look, it gives me a lot of confidence

in what we're doing here and building out something new. We've built the audience now over several years, building it out and adding some of the component parts without doing

the complete boondoggle of what they're doing over at CNN. And look, I have some bone to pick too, also with the content. I mean, the Anderson Cooper parenting show, I actually looked into it. So Anderson's show is parenting advice as a working dad. And I just, look, I have no disrespect for Anderson in terms of what he actually does when he goes to Tahrir Square in the middle of the Cairo protests. Actually good at what his job. But the idea that the heir to the Vanderbilt fortune who is a single dad has anything in common with a real single dad who is working several jobs or a single mom, that's ludicrous. I'm sorry.

Like, what's your problem? That the nanny didn't show up on time? Or that your shift schedule went off and that your caregivers got their schedules mixed up? I'm not diminishing that it's probably not still hard to be a single dad when you're a multimillionaire. But it's not exactly a relatable situation. You're literally the heir to the Vanderbilt for me. It reminds me of when Sheryl Sandberg

was trying to get parenting advice, remember? And she'd built down a whole nursery next to her like sweet office. I'll just do that. Her nanny would be there full time with her kid and we're like, oh yeah, everyone can just accomplish that. That's going to make it super workable. So I didn't know that that was the framing of the thing. That's what bothers me. You know, there are actual single parents out there.

I've met some of them who really. And they have really a big problem. And they're not rich. They can't relate in any way to your experience of being a multi-millionaire television host of living in New York City. And you kind of have the audacity to try and sell that to people. I think that's completely ridiculous and insane. Same whenever it comes to all of the other offerings that they have. Jake Tapper's book club with Dolly Parton. Wow, I've never seen an interview with Dolly before. Might as well pay for it. I can't say anything about that because I would

love to have an interview with Dolly Parton. Yeah, sure. But she's been interviewed a million times for free. You can go listen to her on any podcast. I think also it's just like, remember some of the reporting after Zucker was out was about how internally there were a lot of questions about CNN Plus because this had kind of been Zucker's baby. Yes, that's right. And even some of their staff were like, I mean, Jake Tapper's fine, but like, are people really so enthusiastic about Jake Tapper that they're going to sign up for his book club? All of this is a way of saying, like, they have no idea what they're doing in this space. And I think it's very revealing because, number one, they clearly know that their traditional business model is under threat. Is it still wildly profitable? Yes.

But they also can see the writing on the wall. Their demographic is super old. They're under threat from, you know, the whole array of content, not just news content like ours, but other options that are out there. Younger generations are not signing up for traditional cable packages, so they know they have to do something, but they have no idea what that might actually look like to provide some sort of valuable content that people would believe in. That's really the thing, and be willing to

sign up for. I mean, that's what we find with our subscribers is, you know, as much as we try to give them, you know, access to things early and special interviews and AMA that we do and all of that, what they're really here for is because they believe in the mission. They believe in the project. They believe in what we're trying to build. Who believes in what CNN Plus is trying to build? And also, what are you even trying to build? Because that's the other part of it, is the content is incredibly scattershot. It doesn't provide really any sort of value add to what is already on the channel. So who is your target audience here? We've got the USA Today review. Go ahead and put the USA Today screenshot up there. So they say, watching CNN Plus's first day. So what are we doing here?

Hint, talking about Will Smith. This person, brave individual, went ahead and watched the first four hours of CNN Plus. They say, so what are we doing here, Brian? Stelter asks at the outset of his show, Reliable Sources Daily, in case there wasn't enough Reliable Sources, which gets very poor ratings, even on his normal CNN channel, they decided to give him a daily show

on CNN Plus Tuesday morning. I was asking myself the same thing at 4 a.m. Pacific when I tuned into the kickoff of the new streaming platform. After watching the first four live shows on the platform, the answer to Stelter's question was clear. They were talking about Will Smith. Before the launch, the biggest question about CNN Plus

was why it was needed when the CNN network can be viewed on TV and online. After watching the first four shows airing on the platform Tuesday morning, that question changed, replaced by a new one. What would they have talked about if Will Smith hadn't slapped Chris Rock at the Oscars? I think it's a perfect encapsulation because it's exactly the type of story that people who know nothing about alternative media would think like, oh, this is the hot thing that we should really lean into that people just want endless takes on. so they're just chasing whatever they think is going to get clicks and views rather than actually

having any sort of like identity or meaty value generating offering. Like, did you really need more Will Smith takes? Was that something that you were really dying for out there? Was that a need that was unmet? No, of course not. No, it wasn't. And I think that this is the point, which is that whenever we've spent years building this up and understanding what exactly both people want and also inventing different ways. I mean, some of our union coverage was not popular in the beginning. Actually, it was pretty unpopular. We just did it anyway because we believed that it was important.

You have to build a constituency around things sometimes. You have to believe in something. Yeah, and you have to believe in something. Stand for something, you know? And, you know, I see, I can see within this that it is just a multimillion dollar boondoggle. And really, if they really had courage, here's what they would do. They would say, we're not doing any more deals with cable, as in no more Comcast, NBC. We're going to put all live TV on the internet and let's see how it works out.

That would be a gutsy move. But guess what? This is the innovator's dilemma. They can't do that because they make billions of dollars. They have too much invested in the current model. Way too much invested in the current model. It's like Kodak inventing the digital camera in the 1980s. Technology was there.

Everybody knew what was the future. But you make a whole lot of money on film and the shareholders demand profit and the parent company wants this. They have the inability to disrupt themselves. Only great businesses can actually do that. Otherwise, people like yours truly up here are the ones who are going to come and eventually eat your lunch. But I do want to put out a word of caution and for us not to be too triumphalist here as they fall on their face because they can't compete with actual alternative media and the offerings that are really quality out there.

And there are many, I think, quality podcasts, quality YouTube creators who provide really in-depth analysis. I know I've been relying a lot on, you know, that sort of analysis during the Ukraine crisis, going back through the history and military strategy and trying to understand what's going on. They can't compete with that. So what are they going to do? They're not going to just say, well, we just can't do it. No, they're going to try to rig the market. They're going to try to destroy the things that are out there that are good so that people have no other choice. And they'll also, listen, we'll never know what their real numbers are because they'll bundle it with HBO or Discovery. And so you'll never actually know what a failure it ultimately is. But the fact that they're trying to play anywhere

in our space, like anywhere close to our space, is a direct threat. Because again, they don't care about actually playing fair and like, let's just compete in the marketplace of ideas and provide good content. No, they'll win at all costs if that requires, you know, smearing all of Substack as racist or whatever they're going to, you know, unfettered conversations or smearing all podcasts or smearing all YouTube creators. They will do that. And we've already seen those tactics be employed. So that's my sort of cautionary note here is even though they suck, that doesn't mean that it's not going to be really damaging. Oh, we shouldn't be. We should not be too rosy about it at all.

Look, it's fun. I'm going to be honest, especially this part. Let's put this up there on the screen. CNN already bracing for layoffs. This is from Charles Gasparino. CNN Plus employees bracing for layoffs as soon as May amid projections of lackluster sales of the new streaming channel. CNN employees say new streaming channel could be merged into a larger Discovery+,

as early as May, unless subscriptions pick up from Fox Business. CNN responded and said that that's not true, that they're very happy with their launch. We'll see what the truth is.

All reporting from inside the house indicates that the new parent company does not like CNN+, that they are already scaling back its vision, and that Zucker specifically was the godfather of this thing, and that with him gone, that it is probably a goner, and it'll eventually get folded into the broader thing.

It's funny. On their marketing, they're marketing the hell out of the fact that you can watch Anthony Bourdain's show. You can already watch Parts Unknown on HBO Max. You don't need CNN Plus to watch it. So the only thing that they have, and by the way, he's dead. I mean, rest in peace.

But it's kind of gross, and this was written in the Puck review as well, to use a dead man's image in order to sell subscriptions. I think that's kind of seedy, given that he's been dead for several years. It also shows the pathetic nature of their offering, that that's the best they have to offer is something that is from the past and not, you know, what their new offerings are ultimately for the future.

I do want to throw in there with regard to, you know, the Fox reporter who is reporting this information, which may or may not be true. But I'm going to go ahead and believe that it is true because I do think that their launch was a dismal failure based on all available signs. Fox's streaming effort has also been a completely dismal failure that they have also spent a lot of money on in terms of acquiring talent. All of them have, all three, Fox Nation, ECOC, and this. The MSNBC one has also been, they just have fallen on their face because they all are subject to that same issue that you're talking about is they just don't understand this world at all. Their traditional model is what earns them the bucks and makes them the money. And it's very standard, sort of like there's this standard concept in businesses that it's very hard if you're the legacy business to be also the innovator.

And so they're not really able to pull it off. None of them have been able to pull it off, and it doesn't look like CNN is going to do anything better. That's right. Camp Shane, one of America's longest-running weight loss camps for kids, promised extraordinary results. But there were some dark truths behind Camp Shane's facade of happy, transformed children. Nothing about that camp was right.

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