Factually! with Adam Conover - The AI Bubble is Ready to Burst, with Brennan Lee Mulligan and Ed Zitron

Episode Date: June 26, 2026

Smell that? Is that the stench of the algae bloom in Washington? Or maybe the odor of a big honkin’ AI bubble that is ready to burst? I’ll tell you what doesn’t stink: the huge sweep in Left Wing candidates in Mamdani’s New York. This week, Adam is joined by friends of the show Brennan Lee Mulligan (Dimension 20, Critical Role), and Ed Zitron (Where’s Your Ed At?). --SUPPORT THE SHOW ON PATREON: https://www.patreon.com/adamconoverSEE ADAM ON TOUR: https://www.adamconover.net/tourdates/SUBSCRIBE to and RATE Factually! on:» Apple Podcasts: https://podcasts.apple.com/us/podcast/factually-with-adam-conover/id1463460577» Spotify: https://open.spotify.com/show/0fK8WJw4ffMc2NWydBlDyJAbout Headgum: Headgum is an LA & NY-based podcast network creating premium podcasts with the funniest, most engaging voices in comedy to achieve one goal: Making our audience and ourselves laugh. Listen to our shows at https://www.headgum.com.» SUBSCRIBE to Headgum: https://www.youtube.com/c/HeadGum?sub_confirmation=1» FOLLOW us on Twitter: http://twitter.com/headgum» FOLLOW us on Instagram: https://instagram.com/headgum/» FOLLOW us on TikTok: https://www.tiktok.com/@headgum» Advertise on Factually! via Gumball.fmSee Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

This is a headgum podcast. It's Friday. We still don't have a name for this segment, but we're breaking down the news with two smart and funny people. And me, I'm neither. With me this week, we got Brennan Lee Mulligan. Hello, it's a pleasure to be here.

Dropout Star, uh, internet dungeon master. Internet dungeon master, Dimension 20, critical role, Worlds Beyond Number, thanks for having. And we have writer and, uh, Man About Town, Ed Zittron. I'm here. I'm back. Man About Town.

It's an exciting, it's a very exciting time for me. This, this episode is, likely to break the internet because you guys, we get a lot of views when you guys are on the show. We got both of you. Combine our forces. Yeah, boom, combine our forces. With all of your incredible financial and tech prowess and me being a former improv teacher, we are

really, we're going to really bring it together. You have a lot to say about our first topic because Zoraamadani, New King Maker. Start spreading the news. You're so happy already. He had a clean sweep of congressional congressional candidates in New York City of candidates he endorsed.

And the down the state assembly too, like crazy batting batting average for his state assembly candidates as well. Unbelievable. Yeah. Before this, like a couple days before the New York Times was writing like, oh, he's taking a really big risk. He's alienating a lot of people.

He's betting on some long shots and his picks won by as many has 30 points. I don't. I really don't think that, I'm trying to think of a time in history when elite power brokers were more agog at the fact that they keep running into the brick wall of reality. Yeah. Like if you look at the general population's opinions of AI, ICE, Donald Trump, they're all down there with the Democratic Party and Congress.

That's the thing is people don't realize how so much of our political moment is explained by how his, historically unpopular, everything is. Do you mean like, it is, it is a round rejection of the cosmos. Everything. Of literally everything that they're trying to put in the past, yeah, go ahead. I'm really enjoying watching also these very centrist Dems just going like, I don't like this. What do you mean you're going to do something? Why do they like Man Donnie?

Oh, he explains things clearly and he does stuff and he governs with intention and we can point to the things he's done. I don't like that. Balanced budget, expanded child care. Day three, we got the Zor ramp. Oh, you fixed the Williamsburg. The Williamsburg ramp. I rode over that ramp, baby.

That ramp sucked. I've said this on the show many times. One of the first things he said he was going to do was build thousands of public restrooms, which is what could be a more key thing? It's also, it's such good, it's such good leadership, such a government,

and it's such good politics. Because there are so many parts of politics, like so much of the right wing in this country is like, how do I convince you that your relationship to Colin Kaepernick is more important than any material facet of your life. But on the reality side of things,

what is a more profound experience than being like, I'm trapped in New York because something happened and I'm in between two things and I'm suddenly like, I'm gonna shit in three minutes. Yeah, unbelievable. Where is that gonna-shit this far? Folks, we never shit this fast.

It's the most we've ever, we've never pissed. So conveniently. And you go, where is this going to physically happen? because it's happening in T-minus. And here's a guy going, I'm going to fix this for you. It's the Zor ramp. The first time someone goes to a brand-new public bathroom

and it saves their life, they're going to in their head go, thank you, Zoron. Yeah, his name is going to be on the side, presumably, if he's like any other elected official in America, he'll put the name on the side of anything he builds. But Democrats don't do this shit. Like Donald Trump signing the stimulus checks

is smart politics. And the fact that day three he built that ramp, I don't know how many thousands of New Yorkers go over that ramp every day, but every, da-da, off the Williamsburg Bridge is accompanied by a silent, thank you, Zoron. Well, here's what's fascinating about it, because I agree with you. That's, it's incredible that he's been running on that. That's what we need Democrats to do is, like, actually build shit that makes people's material lives better. And so to some extent, I felt like the rest of his progressive commitments were great, but a little bit beside the point, right?

Like he, for instance, obviously a big supporter of Palestine and against the genocide happening in Gaza. But hey, he's the mayor of New York. You know, this is his personal belief. It's not that important. Or it is important, but, you know, less so than the material stuff. But for him to immediately wade into national politics and get people elected congressionally that share those values. And I mean, like, that is a live issue for like the number of pro-Palestinian or Israeli skeptical members of Congress just like quintupled overnight because of this.

It's really, but also to reframe what you just said for a moment, because I think your point about like, okay, that moment on the debate stage where he said, where you had every mayoral candidate say, I would travel to Israel and he said, I'd stay here in New York and talk to Jewish New Yorkers in the city that I want to be mayor of, that was, that did have to do with him being mayor because he did address a political shiboleth and say, no, I'm going to do the pragmatic thing. I am the mayor. I'm focused on meat and potatoes. Yeah. I like that moment where he says that his, I think, I think his politics around the genocide in Gaza and around American foreign policy support for what the IDF is doing there is specifically like very germane because he's saying

this is wrong and also an enormous distraction from my affordability agenda. Like I'm going to be a good mayor for this city and not support this insane foreign policy that is only morally reprehensible and helps us not at all. A hundred percent. I completely agree with you. But what I think is a little bit unprecedented is him wanting to influence national politics this quickly and this directly. I mean, essentially what he and DSA New York are doing, and I think other DSA chapters

around the country, is they're building a separate political machine from the Democratic Party that's going to get different types of candidates elected. that can do so reliably through their own power. They don't need anybody else's help. They don't need any other donors. They don't need to make anyone else happy. They knock doors. They raise their own money.

They get candidates that they like and they get them elected and they change the policy of the country as a result. And you know, I was trying to figure out like what other mayors have done this throughout history. It's like, first of all, people from 50 years ago, 70 years ago, it's Huey Long. It's like boss tweed stuff. And they were doing it for, I mean, Huey Long was a leftist, but they were doing it for a lot of like personal political game.

And it took them decades. Zoran's been in office six months, and he has already, like, you know, flipped a whole bunch of the delegation. Something I really like that Zoran does as well is his videographer Boringstein on Twitter and Blue Sky. Look him up. He's fantastic. His video stuff is really great because he explains what's going on when he was balancing the budget. He was like, yeah, this is what's going on. This is the problem we have with this way we have the over ridge.

When the massive storms hit, like I was in New York for one and wasn't for the other, he did these excellent videos being like, this is how we're dealing with this. if you see a homeless person call this number. And it gets back to the thing of Democrats not writing their names on stuff. It's also Democrats not explaining governance at all. Like the average person has this very social media maligned perspective of the government. They either does everything or nothing. And usually like the Republicans do things to the country and Democrats have stuff

done to them or nothing. And so seeing what Zoran's doing, I think what's so scary to the Democrats about it is that he's doing stuff. And he's like, yeah, I'm doing this. This is why I'm doing it. And the people he's running are like, yeah, I too will do stuff, which is terrible. And I say this as someone from England and watching what the Labor Party isn't or is doing, who knows what's happening there.

It's just nice to see. And truly, it shouldn't be unique, but it is. And it's genuinely marvelous because I learned some shit. Barely know anything about politics these days. But the actual ability for a regular person to go, oh, this is how my city works. Yeah. Well, I think that there's an amazing thing there, which is, you know, the Overton windows often uses this metaphor just about like what is acceptable conversation. But there are weird ways where

you push the Overton window so far that it snaps and reforms in a way that you couldn't have sort of anticipated. And I do apologize because someone actually articulated this much better than I am and I read this online. But essentially it is, look, if you spend 40 years as the right wing project expanding the definition of socialism to be anytime the government does anything but fuck people. Yeah. Right. Yeah.

And suddenly you might wake up one day and people have an overwhelmingly positive association with socialism. Right. If you're, you know, it's one thing if you go like, whoa, nationalizing an industry, which we should do or doing any of these other things, that's socialism. But suddenly you're just like, given a kid help at school, that's communism. You're like, brother, I guess I'm a communist. Like, you know, you have that moment where people wake up and suddenly go, oh, I actually

do want the trans. in my city to work, and I do want the ramp fixed. You're saying fixing the ramp is fucking socialist? Okay. Yeah. Yeah, like... And on Twitter, you're even seeing the right wing people freak out about this and like, socialism's coming in. Socialism, it's communism. They're just giving stuff away. They may... The government is using their money to fix the city. No.

I couldn't possibly have that. And like, the more ghoulish they get, the more insane they sound about it. Yeah, you see the... I saw one of them saying on X, you know, they were like starting to watch... Because the right wing is started to pay attention to how the DSA is actually organizing. Yes. I want to be really clear about this. This is, we can talk about Zoran.

This is the DSA's victory. Oh, yeah. I was there in New York a couple days before the election. Saw the Claire Valdez video. I did a video with Claire Valdez. I did that because a good friend of mine is a canvasser for her and has been spending like the last three months knocking on doors every day and said, hey, will you come do a video with Claire?

Claire's awesome. So I did it. But like, that is the machine that got it done. And so the rest of the political world is starting to go, okay, hold on a second. and these people are real, what are they doing? And I saw a tweet where they had, like, watched a DSA, like, a live stream about how they were going to take this to other places, and they're going, watch out, like, this socialist movement is going to come to your town.

And the reaction, I think, for me, I think a lot of the electorate is, like, don't threaten me with a good time. Yeah. Like, that's what I want. So you're saying they're knocking on doors and talking to people about the issues that matter to them. Sneaky, red stuff to the bit, sounds like commies to me. I mean, they literally, one of the, the Chevalier,

they sent, the Democrats sent out a leaflet about her that said, it quoted her saying fuck Kamala Harris. That Chevalier had said, fuck Kamala Harris online as like, don't vote for her for that reason. What Democrat in New York

is like, how dare she attack this loser? There's also this thing, you look at like Zoran, there was a poll right before he beat Cuomo that was something that like 23% of New York City Republicans, which given is less than a fifth of the city, it's already a weird subsection of people,

but 23% of New York City Republicans had a favorable opinion of Zaraa and Mamdani. You go, how could that be possible? And you go, well, people aren't super ideological. In conservative circles, his response to the snowstorms in the winter, that's like a very New York City Republican thing to me as someone being like, I don't know, sidewalk's clear, can't argue with that.

You know, like, it feels very New York conservative to me to be like, well, if shit's working, I don't have too much to say. In New York, nothing is more important than you getting to work. It's like the train shut down for an afternoon and it's the biggest news story. And also the second snow story. The first one kind of caught them out of West, but the second one, I kept the streets clean. Yeah.

Look, it was a bad one too, but they actually fucking did it. And there's a big part of it, which is this idea of if you are being taxed to begin with, you want some return on it. You want like, well, where, what am I paying for? And again, to create those material changes where you say this is what communal, like, this is what a communal resource can be and do. But like you're saying, I think that one of those things where when people try to attack the DSA as having a problem with Democrats, it does create an interesting on ramp for anyone who's sick of politics to be like, hang on, someone's running for

Democratic office who also was really sick of what's going on. And it's like, I don't know that you, you might not be aware that you're gassing this person up or you're creating at least a sense of, wait, what's going on? Someone also is fed up like I'm fed up. It's this weird thing where I think that outsider status is huge. Other part of it I think is really huge because I was in New York, when I was in New York for the Del Close Marathon when the Knicks won game five.

Okay, we were there for the same festival. We were there for the same festival. Tribeca was happening. It was pride. The feeling in the city is so fucking incredible. It's so fucking electric thing. I'm just watching from L.A. being like, you guys have fun.

Oh, no. I was in Vegas at the time. I couldn't be fucking, I was seeing her being like, looks like you guys are in a great. I was there for when he got elected, though, and that was... I couldn't, I can't even imagine. The entire city ointers won. It was amazing. It was so far.

Everyone was just so excited. And the thing is, it's, we're so used to things being bad. Not just like how the Republicans are, but just the general quality of life for people we spent four or five years reading CNN articles that are like, actually, it's great for you, everything's cheap, you're wrong for being mad at this. And then we have this guy come along. He's like, I'm going to make things better. And he does.

And he's charming and he talks about it. And then the Knicks swim, which was him as well. But yeah, I have, it's like that feeling is so electric. I have friends that are doing amazing with DSA. I did a DSA. We both have done work for DSA candidates this past, this in L.A. recently. The, the, the, the, I have friends that do working families.

I have friends that are part of sunrise. Whoever's watching this, the vibe I get from New York that I think is the thing that is special about Zora. who by the way, I think we always forget, like, yeah, he's a mayor. He's the executive. When he won, he represents more people than Bernie Sanders or AOC. Yeah. As an elected official.

Yeah. Right. Like, there's more people that live in New York City than live in Vermont. Yeah. And he, which makes him as a socialist politician. And also he's an executive. He is, so when we talk about like the significance of Zorn on a national level, this is also my New Yorker pride when you're like, who's this mayor weighing on a national

politics and I'm like, Samar in New York fucking city, baby, where you go, he is the executive of more people than many governors. Right?

He's been organizing for a long time, right? This isn't an overnight success at all. His victory for the cab drivers in New York was a huge, when people were,

I was canvassing, Travis phone banking for him and people would be like, well, what's this guy done? I'd be like, he won an enormous victory for medallion cab drivers in New York City that they,

so people, in other words, as young as he is, he already has people who will show up behind him who are working class New Yorkers to go, this guy's the real deal. And here's something, the new thought that I have based on what happened over the past couple days, because the thing you would kind of see from the left is, man, it's such a shame that this guy can't run for president because he wasn't born in the United States.

Like, what a missed opportunity because he's, as mayor, he's like the second coming of FDR, right? You can see him growing and growing and growing to that level. Now I'm like, maybe that's actually the best thing, because if he could run for president, all anybody would be saying about him. Yeah. Because that's how our political system is structured to just focus on one person. And there would be national pressure in a completely different level. He would constantly have to defend himself. Exactly. But now he can never run for president. So what's he going to do? All he can do is like build a movement, is build a political machine that he can

use to, you know, eventually like elevate somebody else into that role. And that might be better. That's what the leftist movement needs right now. And also New York is a great organizing machine. And he has been part of that world. He is. he's been what several years? At least. He was in the, yeah, State Assembly for, I forget how many years

he was there for, but the, not as long as you would think, I think, but he was in the trenches, actually organizing knocking doors. Yeah, he's, when I was in New York,

the feeling I felt in the air, which I feel like is the, the thing the left, at least my experience of the left has been, which is always, I agree with all of our values, but it's really hard

when your ideology is based in focusing on injustice and you are trying to, to create a feeling of the joy that was present in New York is a big part of the equation. And the feeling I got when I watched some of those victories that they went, especially last night with, again, you know, Dary Elisa was like in the encampments at Columbia.

She's like, these are people that have been in the, you know, Claire Valdez's union organizer. This is the answer to so many of the problems in the country. What I saw that feels like the answer for a left that at times has just been swallowing bile for so long at an increasingly like dire world. is, oh, you get to have joy if you're fighting. If you are arm in arm with other people attacking the problem,

doesn't mean you've solved it. But if you're just attacking the problem, the feeling I got like, you've watched this videos of people like knocking doors for Zoron meeting their new best friend. And you go like, oh, fixing the world is very fun. And it's unashamed as well. There's no one's pulling punches. No one's like trying to move a little center because it might upset.

It's straight up like abolish ice, Medicare for all that. No, no. Well, the other thing they're doing, though, is the New York City DSA is being strategic, right? Like, not all of those candidates. For instance, I don't believe Lander was endorsed by DSA, but he was one of Zoran's picks, right? Zoran has done some stuff on the cops that not everybody is happy with, which you would argue maybe he had to do to get elected as mayor, yada, yada. But like, the bile swallowing that you're talking about has led to a tendency in the left where all the left does is critique, power. We love to critique. We love to say it's bad. But if you take power, that means you've

become corrupt and you are, you know, you're actually against us now and we have to fight against you. And I think that what NYCDSA has shown, A, if you are able to say, okay, our coalition's going to be just big enough to win, we're going to, oh, we're going to have a Zoran, we're going have a lander and we can have Valdas, we have all the, all them together, then you can win. And winning feels good. And it leads to more winning. And it leads to more winning. And 80% win, if you get 80% of your ideas or 60% of your ideas in power and people go, oh, that was a good idea. Oh, I like how that one went. I like the free public bathrooms. Tell me more about freeing Palestine, you know, like, or tell me more about abolishing the

or whatever the thing is. Worker-owned companies. Tell me more about what. Yeah, exactly. Yeah, once you get two or three things in like wins, wins, wins lead to wins. So it expands what's so important. It expands what can win. Yes. The next time you can be even more daring. You can actually expand what the Democrat Party could do, for example, like something. And that's a great answer, too, when people come with that idea of, like, look at the other political factors that even the people that are nominally on our side, they are kowtowing to these other political factors. For me, the intuitive thing that it seems like DSA New York has arrived at is, well, if we're tired of our politicians kowtowing these other political factors,

let's replace those other political factors with more of people who are aligned with us. you don't have to compromise as much if the other factions are all replaced by more of you. Live shopping on What Not is exploding. According to What Not, the number of sellers making over $1 million on What Not has doubled in the last year. If you're selling online or out of a storefront, full-time or as a side hustle, you already know the challenge.

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Hell, sounds easy. Anybody could do it. Let's talk for a second about the National Democratic Party and their response. Brennan, you were saying right before we started rolling about Jamie Harrison saying, if you don't like Democrats, you know, if you just hate Democrats,

don't run or don't vote. And that is a bizarre thing to say when the approval rating for the Democratic Party among Democrats is like 20 percent or so, or I don't know the number. It's well below 50. It's a crazy. It's also, it's very, it's very telling because what's the fundamental thing that always gets said as the approach of a general election comes along is like you, oh, what's your vote because of how bad it will be to not vote for us. And participating in primaries and primary incumbents is the way that people guarantee they will come with you to the general election by being like, okay, I'm taking you seriously. You want us in the tent. Now we're in the tent. What Jamie Harrison's thing is is a classic, like, I want you here. I want you with no voice. I want you

to shut up. I want my guy to win. It's nihilistic. It is the opposite of what electing people is. It's, I find it disgusting, honestly, because it is inherently saying not just the, it's not even we know best, it's not even a political statement. It's, we're your sports team. You support your sports team. When or lose, if you don't, we don't want you here. We don't earn this. We're not, we don't represent you. You work for us, which is the literal opposite of politics.

Yes. How do you, how do you, with a straight face as Chuck Schumer, who I believe never endorsed his or on, come around and say vote, can you ever ever say, vote? it blue no matter who. Because Zoron gets to go, I did it the way you guys asked me to. I won the primary. I did it. All my circles are filled inside the bubble and it still didn't seem like it works. So maybe we have to be honest about what you don't like about me. And here's the thing. We'll move on after this. But the thing that pisses me off the most is I've seen these articles about like, oh, it's going to be such a headache for the House Democratic leadership once these people come in. Oh, it's going to be such a headache. It's like that's

fucking leading. That's governing. And for For some reason, the Democratic Party, we all know it's the big tent party, the Republicans are on lockstep, the Democrats, a lot of different coalitions coming together. That's what the Democratic Party is. For some reason, there's always room for the conservative anti-abortion Democrats in Arkansas or whatever, which great, there should be. You do need some of that. But as soon as like the socialist left comes in, oh, we can't have that. Oh, it's going to be a headache. Oh, they're going to ask us to do.

Hey, how about you just make some peace with the six or seven members of your coalition who you're going to be? gonna need to get to vote with you, and you do some fucking politics and then let the party move a little bit. That's coalition policy. What is hard about this? We need Liz Cheney. We need this Cheney. We need the old Accentia McKinsey people that love. We need the Atlantic readers. We couldn't possibly have left this. Well, it's crazy too, because every once in a while, I'll look over the fence at what the right wing is doing. And there's always, you read the news when, when like, Mike Johnson's having a hard time getting a vote together. And you're like, why is, why have they Oh, they failed to pass this bill.

Was it pressure from the left? Ten members, the Republican caucus, demanded that the death ray run on the blood of baby seals. Like, their right wing is constantly winning enormous concessions. And you go, like, yeah, we, I would like some of that sauce. They're able to figure it out. Why are you guys not able to figure it out? And I think it's very, yeah, it's a, this is what democracy is.

And I think what Chris Murphy responded to that, to Jane Harris. basically when Jamie Harrison was like if you're not a Democrat, don't vote Democrat. And I think Chris Murphy was like first of all, you're talking to our voters. Second of all please vote. What are you saying? Like we don't need you? My man, we need them.

Yeah, we need way more of you. Yeah, totally. And guess what? If Jamie Harrison and the rest of them, if they have to organize a little bit, I'm going to start knocking doors instead of just resting on their laurels, like good. If they have to move a little bit, good. It's a very positive development. politics. Now, I am going to talk about what someone said and say that it is very

prescient. And I am going to have to be honest and say, it was Hunter Biden who said it. Was it Hunter Biden or ChatGPT, though? Because he's writing those posts with ChatGPT. He's writing the post with ChatGPT? Yeah, because a lot of his posts are- I saw a video of him drawing a koifish today. Was he, was that Chat-G-G-T too? A lot of his posts are like, you can draw a- you can also draw when you use chat. CHAPT. Yeah. A lot of his posts are like, it's not just snorting coke, it's a way of life or whatever.

It's got the little, my father, the, parallelism. M-Dash, yeah. The, the, no, he,

what he talked about was the, the, the, I think that the hand-winging over socialists is so crazy

for two reasons. The insanity of, we have to be at the end of decorum. If Trump kills nothing else, let it be the end of this idea

of a narrow realm of what's politically possible. The idea that all of the Trump world can say and done the things they have said and done, and that this other type of leftists as a British too far is so absurd.

But secondarily, I think that idea of within, or rather, you know, we're talking about what Hunter Biden said, this idea that from centrist Democrats, that there's something volatile and incendiary about the branding of a socialist, the most radioactive brand on the planet is that of a triangulating politician. A caution is the most odious thing in the world to, I think, American voters of every stripe. Yeah. I think the, I mean, like, that's why all the generic stuff. It's why Congress has stated, like, the idea of Congress has one of the lowest approval ratings in the country, because people just go, the generic idea of a politician pisses me the hell off. Yeah. And so this idea that comes from centrist of, like, he's going to say this wild socialist stuff in New York,

And we're going to have to explain it in Kokomo. And you're like, dude, your problem is that everyone finds you boring and nasty. The fact that Zoran might say an incendiary thing that lets you get a fucking shred of airtime, you should thank your lucky fucking stars for it, not wring your hands over. What if I have to say something that means something? I just love that instead of Peoria, you said, Kokomo, where the beach boys go. I want to talk about AI with Ed. We got, we could talk about this for us.

But, Ed, what's going on in the world of AI? How are things going for Open AI specifically? Not so great, Adam. So about a week and a half ago, no, about, yeah, we can change. I published the auditive financials from 2024, 2025. They lost, they spent $21 billion to make, sorry, they spent $34 billion to make $13 billion. They lost $21 billion. Wow.

And their cost of revenue was $7.5 billion, which makes it sound like they're profitable, other than the fact that they're clearly moving a bunch of costs into sales and marketing, because they spent $5.73 billion in sales and marketing. And it's not on ads. I've looked. And also, Coca-Cola spends $5 billion on ads. It's not that what they're doing is when they have their free users, the ones who use chat GPT free, when they give away tokens and all that.

They're just shoving all the costs in there. Anyway, Open AI is just burning tens of billions of dollars. And as of today, they are moving their IPO to sometime in 2027, to which I say ratat-tat-tat. guess what? It turns out that when people know your numbers are stinky as shit. Yeah. That no one kind of wants that. And they specifically, the story, Mike Isaacover at the Times report with this, that apparently the reason is that they can't get a trillion dollar valuation, which is really bad because their most recent valuation was, I think, 765 billion. Yeah. Which is just like, I don't see how this company moves on from this point,

other than into the toilet and aggressive blushing. And the entire stock market has started shuddering a little bit at AI, right? Like, we've started to see headlines of tech stocks pull back because of AI fears, then they make up some ground, but like, I've seen that story about three or four times the past couple months. Elon no longer a trillionaire, I think, as of. He dropped, sadly, he dropped under the basestometer. He's bad for Mr. Elon. But the thing that's happening is- He'll build it up there again, but go on. Well, what's really weird is so SpaceX went public. They popped, they dropped. No one really, everyone's kind of unsure what happened there other than the fact that it's a company

loses billions of dollars and sucks. But the big thing that's happening right now is we're about three years into this horrible era of over a trillion dollars of capital expenditures. So just hyperscalist, predominantly Microsoft, Google, Meta, and Amazon spending what is now over a trillion dollars. They're going to spend $765 billion just this year. They're going to spend another trillion in 2027. In doing this, they have made it impossible for people to find RAMP because Micron, SK. Heinex, Samsung, people that make the random access memory.

Yeah. When you're using the computer, the stuff you're using is moved into that. so you can quickly access it, kind of a basic explanation there. But because AI chips, which are in these GPUs from Nvidia, require an absolute arse ton of high-band-wit RAM, all the capacity is taken up by that. So what little is left, they can just jack up the price. And because everyone wants to buy these GPUs for data centers

that are barely getting built, they're full of RAM. RAM prices going up. Micron is now, I think, that they're going to have something like $40 billion of quarterly or annually revenue, some ridiculous amount of money. And two years ago, they were in dire straits, losing billions. But what's happening is because of that, everything is more expensive. Apple just

announced price increases. Xbox just announced price increases. What was funny with Microsoft is they said, yeah, we're having to increase the cost of the Xbox due to conditions we partially created. And so what's happening now is over Anthropic Open AI, they're both losing billions of dollars. But the real problem is, is that these companies have to keep growing. They have over 1.1 trillion dollars of spending commitments. They are the future revenue stories of Oracle. We can get to Oracle. They might die. Microsoft, Google, it would be so sick. Google, Amazon Microsoft, they are, I think, half of their upcoming revenues, their remaining performance obligations. And these companies must grow. They must keep growing. Or just half of the upcoming revenue of the largest companies

and well, just won't exist. And that's really bad because these companies lose so much money that they run on venture capital. It's not really clear how the maths works out. But if you ask AI boosters, their answer is it will work out. That is the best they've got. It's like, oh, we're, you know, they'll just become profitable one day. And I'm not kidding, this is the nuance they've got. There's a report that came out today from some AI booster analysts that was saying,

oh, there was a $110 billion of AI revenue. 75% was Open AI and Anthropic and their compute spend. So it's just everyone frames this as some era of two massive startups that have grown, homegrown heroes. What it actually is is two companies that were seeded, funded, and had all their infrastructure built, but the largest companies in the world. It is an attempt to frame this thing as a cute startup revolution. What it is is the largest subsidiaries of the largest companies in the world,

sapping everything, taking everything, feeling our countries with half-built data centers, full of expensive GPUs that do basically one thing, make shitty AI that still does not do the things they've been promising. Like, it's still not doing it. It's better at coding, but it is still, and we can get to the subsidies in the second, massively over-experate. It's got to the point when it's more expensive than a person. Well, let's talk about what putatively AI is actually being used for.

There's been like a pullback from the position of companies doing previously what was called token maxing, where they were. asking their employees to use as many tokens as possible, literally measuring employee performance by how much AI gasoline they burned through. They've pulled back from that why? So, here's a thing. Whenever you or I would, they do three kinds of subscriptions, $20 bucks a month, $100 month, $200 bucks a month,

open AI and Anthropic. Now, on these, you can burn up to a certain rate limit. They don't tell you how much it is, but you can burn as much as you want. There's a five-hour limit and a weekly limit. So, semi-analysis did a report that they found on Anthropic subscriptions and the $200 a month one, you can burn $8,000 worth of tokens,

and on Open AIs, you can burn $14,000. Wow. It's so cool. So that's the subsidizing that you're talking about. So here's the funny thing. So up until about, I would say, March this year, everyone was on these subsidized. Go nuts bananas.

You can spend as much, and everyone was token maxing. Then Open AI and Anthropics said, enterprise customers, so more than 150 people using it, you now have to pay the actual token rates. And a token is three quarters of a word. And so something that's particularly verbose, like code, lots of text, it's going to burn more tokens. And so Uber burned through their entire AI budget for the year in three months. Wow.

Someone ran up, according to Maddie Mills over Axios report. Someone spent half a billion dollars on tokens in one month because they forgot to set spending controls. Brex, T-Mobile, Walmart, a bunch of other companies have all put caps on people. And so across the industry, you've got everyone, it's so funny, you've been watching all these people going, AI's the future, I'm going to use as much of this as possible to everyone, just austerity measures. Like, well, we need to be more efficient now.

We couldn't possibly spend as much. So like, look, I'm a lay person. Yeah. So this person, so they spend half a, we said half a billion? Correct. So, like, did they, like, cure cancer or make a rocket, or is there a good movie? Or did any?

What the fuck happened with that money? My man, I've been saying this for three fucking years. I've been saying, you motherfuckers spent a trillion dollars. What have you got for me? It's like, well, we can do Mama Duke with an AK-47. We've got Garfield with big, juicy boobs. I don't know what to tell you. It can sometimes code things correctly, sometimes it doesn't.

It's different Google, right? It's shittier Google. Ostensibly, right, it's being marketed as here's the ultimate tool for you to do. do X. Because like if you, if it were a super villain, it would be like you're, the whole fact that AI is being marketed as a retail opportunity is such a alarming red flag for me. Because you're like, well, if you have sky net, you make sky net or you do something that is, it's the idea that it's like, we have invented God and we are leasing God to you on a monthly subscription is so ding, ding, ding, ding, ding, there's a problem. Well, the thing is, is they're not actually anywhere. They're

They have nothing sky. They don't have anything autonomous. They have LLMs that do not think. They don't have consciousness. They are probabilistic. AI boosters will get very angry to say, it's not, I'm a big boy.

I'm a strong big boy. It's not probabilistic. It is. It still is. They can attach a bunch of scripts to it, but that's still what it is. Not conscious still. So these things don't do anything sky netty.

They can't do much autonomously. They will mess up stuff they always do. So all of the things that we culturally think of AI for, which is autonomous. personalization, reliable, kind of set it and forget it. It's the complete opposite. They're like, well, you've got to prompt it correctly. Oh, you use the different model. Yeah, you got to prompt that differently too. Now, is it good? Sometimes, can't say when, but when it's good, it's great. Well, it's good. When it's bad, well, that's your fault. It's the, it's this very strange thing

where the ideology of it has completely taken over everything to the point that people just become dog shit merchants. They're like, actually, this is great. It's, I would, I, I, I, except being debased by this, I will defend it to people at the times. You got people at the times, well, not anymore, I guess, who were just defending this based on terms that are not real, based on things that are not happening. And it's so strange because people say it's just like dot com, it's nothing like anything before. What do you make of the, you know, the explosion in the use of agents, at least by people who are very vocal about them on X and, you know, like programmers with blogs,

running an agent to, you know, do shit in a loop to, like, code for, you know, like... That's still large language models. Yeah, well, no, I know that it is, but it is like, you know, I see, like, hobbyists or individual, like, engineers who are, like, really taken by the ability to, like, now manage an agent in its coding rather than them doing it. And to me, it looks like, all right, this is the hobbyist version of this, is, does that at all scale to being used on an enterprise level? Or is this somebody who built a room button as excited?

about it. A little bit of both. So there are good software engineers I know who use it. And Carl Brown, internet of bugs, he says it makes the easy things easy and the harder things hard. Or harder, even. Let's talk about these slides that you found from the CEO of SoftBank. These are some of the funniest things I have ever seen. Can you contextualize what we're about to look at? So Open AIS had $60 billion invested in it by SoftBank, primarily Masayoshi son, the CEO of SoftBank, who's been... CEO from the beginning, lost $14 billion on Wii work. So SoftBank has been going through it for a few years.

The owner reason this company, which owns all sorts of things, they own gas stations, mobile phone companies, but nevertheless, they have been going through it, but they've had a few really big wins. Alibaba, he got in really early, turned like $20 million into $100 billion, like genuinely insane, did the same thing with Arm. He also has these things called Division Funds, the investing companies. Those have all been terrible investments. He invested in Uber at the worst time, which was really difficult.

There was like three months you could do a bad investment. It was really incredible. He was just like, and now, and it just before the IPO and it's way overpriced. So, at the 46th annual shareholders meeting of SoftBank, Masayosi-Sutton went on stage and he did this incredible speech that involved, well, a goose. And this is not the first goose he's used. This is 10 years ago he used the goose and the value of the goose. So this presentation, it does have some logic to him in that each egg represents a certain

amount of money. And there's a particular slide I'm thinking of where he explains the value of geese or the eggs and how the most important thing is owning the goose, not the eggs, and that soft bank is the goose that lays the golden eggs. Also, the goose is a factory, I believe. Yeah. I mean, just this slide itself, 16 years ago, Agree Value of Holdings, J.P.Y. 5T, there's three golden eggs, there's two outlines of an eggs, there's a picture of a goose,

it's inscrutable. Can we see the next one? Yes, that's the next slide. Right, 16 years ago, three eggs. Market only saw the eggs, by the way. Yeah, market capitalization, and now we only have three eggs. The outlines are gone. Next slide, to the next one. Shareholder value three eggs. Goose was not valued. Goose value zero? You think... News value zero is what I will blurt out when I have a stroke. And I just know, just... Well, because the goose is redeemed. Can we see the next slide?

Oh, eggs do not lay eggs, guys. I don't know what your questions are about this. Three to 74, increased 71, 71 more eggs. Yes, they got 71 more eggs. Now they have 74. Where those eggs come from? Not the other eggs. Is 74 related to anything in the real world?

It was the number 74 about something? I think so, but I can't really, it's so hard to pass because I've, I've gone through these slides a lot, I've read the transcript. Even then I'm like, mate, what do you mean? What do you mean eggs? One time Masayoshi's son, so when things were going really badly in 2020, he spoke to his, I think it was his shareholders and he said, yeah, you know, Jesus was misunderstood too. And also the Beatles weren't popular at first.

It's just like, Jesus loved talking about how to get more gold. That was the main thing Christ was talking about. You remember the bit where he high-fied the moneylenders? My man loved them. He said, Jesus leans over to the money-lenders and says, Goose value zero. This is such, like,

logic of a guy who's on uppers and on weed at the same time. He's like, this metaphor, it works. The goose, the eggs, it's so funny that this company has, like,

invested $60 billion in Open AI, like, real money. Yeah, we haven't gotten into the biology of magic geese, but also, it's, Kind of a misnomer to say that eggs do not let.

Theoretically, these eggs are how these magic geese reproduce, in which case they will hatch into magical geese. Yeah, but the eggs don't. Oh, they don't really wait. Let's see the next slide. There's more. I don't know if the eggs. Here, we got, this is, this explains it all.

It was the goose that created value. Triumphanting goose. Goose value 71. We're back, baby. Let it go. You, well, not USA. I just love, I would love being a share. I mean, if I was watching this life, I'd be going,

ape shit. I'd be like, yes. One thousand years of blood! It was the ghost that created the value. Important detail though, during this speech, before this, before you got to this, he was like, yeah, and I'm not retiring for at least another decade. This is the thing. All the other tech people, they're so damp and boring.

Dario Amadeh, very wet guy, very boring guy. Sounds like he's doing the Elizabeth Holmes, but it's Dario. Sam Altman, very damp, very boring. All these guys very boring. Asi Yosh's on, he's like a whimsical dope. Like a goofy oaf. He's just like, what? It's ghost-ton fellas.

But if you want the public to believe that your AI story is more than just a fable that you're telling them, more than just an extrapolation, maybe doing it in terms of geese and eggs is not the best way to go about it. This is so abstract, even if you understand what he's trying to say. Can we get to the slide where you see the inside of the goose? What? It might have been. I think it was earlier, actually. What matters is not the eggs.

I have been saying this. What matters is not the eggs. It is the goose itself. True value equals the power to keep laying eggs. I am always saying this. It's a fucking ESOP's fable. I love it. He's saying this to his shareholders.

The people who were there have invested tens of millions of dollars who have sat through like entire epochs of him just blowing billions of dollars and like, all right, this is a big year. AI bubble's looking pretty bad. I'm sure Masayoshi's got, oh, what's that about eggs, mate? Oh, the power to keep laying eggs is right. Great stuff, Masayoshi, son. Thank you for that.

Yeah, you have big investors being like, I can't believe I thought it was about the eggs. I was so stupid. Yeah, they're telling me, oh, eggs don't lay eggs. I mean, even if it's... What matters is not the eggs, it's the goose itself. Duh. Even if you set all of that aside,

the point, isn't the point just, yeah, I understand I'm invested in a company, not in just money, right? You've invested in the golden, the goose machine. That is what a company is. Yeah, if we could get to the slide with the innards of the goose, you'll know what I mean. It's the one with the gears. I think it's, I think it's bad. Yeah, you'll have to go back. There's gears in this?

Yeah, yeah, yeah. Oh, no, no, no, we've lost the goose. Well, one of my favorite slides is the one where it shows a bunch of like crazy, like semi-conductions and half-convincorkeptical. Okay, right, right, eggs. Goose, not eggs. There it is. Okay, so the truth, the source of value is, of course, the golden egg factory inside the goose.

That's not how geese work. That, the, I mean, I've not, have you seen the inside of a ghost? I haven't. There's such an incredible, there's such an incredible, like, tell here about, like, and as we all know, inside every living creature is pure machinery. Anyway. I also like the idea that there's a conveyor about, but what you see are the eggs, what produces them is the factory itself, which is a goose.

And ASI means artificial superintelligence, which Masayoshi some once said he was put on Earth to create. And this is of course the true source of value. I really just, I wish I could have been next to any investor during this and just watching, oh my God, oh my God. The number of mixed metaphors, what you see are the eggs, what produces them as the factory at some, no, well, is the factory a goose? The factory is the goose and the eggs are both labeled artificial superintelligence.

This song make eggs or geese? This slide makes me really think we need a 100-year more moratorium on the concept of business. Everyone go back and read a book. Everyone needs an English degree. Inside the golden ooster lays the egg is the factory that every goose is. I mean, this is going to be the image of, you know, stockholders jumping out of buildings in 1923, right?

Or whatever. Just like the geese budget on the big short two is going to be fucking insane. This is the story. But that's actually a good point, though, about the moratorium. Because this entire era is just a sign the, Well, I mean, capitalism being broken, obviously, but just the people running the show don't have any idea what they're doing.

Everything they're doing is just jumping from one thing to another. Speaking of dead waterfowl, the reflecting pool in Washington, D.C. Has been, has been, I'm sorry for that hard pivot, but you did set me up for it. It is, there's currently an algae bloom that's killing ducks in the reflecting pool

after Trump's ill-fated attempt to renovate it. But it's only spent a minute on this because it does seem like a very stupid story. I think what's remarkable about it is how much it is sticking against Trump. Like it literally seems to be getting as much coverage as the botched Iran war deal. Yeah, it's the red, white, and green, I think it is now. It's the, well, I think it's a heavy visual. Yeah.

It's such an easy fuckup and it's so non-ideological. Yeah. You know what I mean? Like there's like you have to train your base to have the, to have the smooth ramp. and tracks onto what the talking point is. And it's just hard if you're a red meat, MAGA hat guy to be like, actually, I've been thinking about reflecting pools

hard for 10 years. You can't come over the top. It's not, you don't have a pre-packaged response. Also, half the GOP Electora is pool guys in Florida. So, like, yeah. They're all, none of them can. I forgot how pool guy coded MAGA is. It really is.

It's like, uncles with Ford dealerships and pool guys. And it's, you know, that they're sitting there being like, help a fucking job. I wish I'd have got it. Yeah, it's a, there's just a bunch of guys who have every ounce, they're just primed for xenophobia and hatred. And then they're like, just a little bit of bleach, Donald. I mean, a small one, 100th park.

Also, it was a no bid contract to like an Ohio developer as well. Who looks like the penguin from Batman? I did not see what he looked like. Can we, God, please, Trevor, can we bring it up? Is this the guy who looks like, oh shit, the red, I'm gonna bring up a guy who is, he, you can see him in the back of the goose. in the factory boss's office is what this dude looks like.

Hey, boss. We got a fresh goose in. Check out these eggs. Oh, I'll make that reflecting pool. Blue is the sky, boss. You don't have to worry. Oh, I know a little bit about geese. The only thing I'm getting that way is Batman.

I think a big part of why there's hurts Trump is because he, like, he's supposed to be the master constructor, the master builder. Yeah. He got fucking rolled by a contractor. Like, a contractor came in and said, yeah, we'll fix the pool right up. And now there's like chunks of blue floating to the surface. There's an algae bloom. And Trump can't just say, yeah, the contractor fucked.

Everyone's been fucked by a contractor. They also way overreacted. I saw a, I think it was Jack Rhodes or something. Someone made a really good tweet where it's like, all the soldiers who are there, it's like, soldier, your mission is you must protect the reflecting pool from random people with their iPhones. Soldier, you must walk around in 95 degree heat and 80% humidity. to protect people from taking single pictures

or picking up a little bit of pain. And it's just like the massive overcorrection. Instead of doing what anyone else would do is just go, go screwed by a contractor, we're going to fix this up. That's actually one of the most approachable, bipartisan issues. Like, yeah, we've had a bad contractor come in.

Oh, what a mistake. Oh, we're going to get him to fix it. No, they're just like, no, send in the army. We need to make sure no one take, we need to make sure anyone who comes near this is arrested. We need a barrier. They detained a US Olympic athlete for five hours for touching the pool.

Nice. Awesome. I believe a, I believe a rower. That's, that's it for this week. Thank you guys so much for being here. Brennan, where can people find you on the internet? You can find me at Brennan-Ly-Molligan on Instagram. You can find me at Bradley Mulligan on Blue Sky. You can find my work at dropout.com. On Game Changer, make some noise, dimension 20. You can find me work also a critical role where I'm DMing campaign for or over at Worlds Beyond Number of podcasts that myself and my pals are. How do you DM so? We, we, let's a different podcast. But, You fucking, I don't understand it with you. I believe in working for a living, unlike all these fucking CEOs that should be in jail. Sounds like a man without a goose. The value is in the small gnomes building the eggs inside of the goose. The golden egg factory is inside the goose.

And Ed, where can people find you? Where's your ed. dot app for my newsletter. I do a free newsletter and a massive premium newsletter every week. Also better offline.com. Follow the podcast, listen to the podcast, download the podcast. and, of course, by me Ed Zittron,

E-D-Z-I-T-R-O-N on basically everything at this point. No one else is this, and if they are, I'll stop them. Hey, you guys could, of course, find us at patreon.com slash Adam Kanoff if you want to support the show. Thank you so much for being here.

I think we're off next week on Friday for the 4th of July, but we'll see you the week after that, and of course we'll have lots of other great episodes of factually coming out throughout the week. See you then. Thank you guys so much for being here. That was a hit gum podcast.

Hi, I am Mandy. more. Sterling K. Brown. And I'm Chris Sullivan. And we host the podcast, That Was Us, now on HeadGum. Each episode, we're going to go into a deep dive from our show, This Is Us. That's right. We're going to go episode by episode. We're also going to pepper in episodes with different guest stars and writers and casting directors. Are we going to cry? Yes. A little bit. Are we going to laugh? A lot. A whole lot. That's what I'm hoping, man. Listen to that was us on your favorite podcast app or watch full video episode. on YouTube or Spotify, new episodes every Tuesday. Hello, I'm Johnny Knoxville.

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