Lemonade Stand - Debt is about to crush America | Ep 012 Lemonade Stand 🍋

Episode Date: May 22, 2025

We launched a Patreon! - https://www.patreon.com/lemonadestand for bonus episodes, discord access, a book club, and many more ways to interact with the show! This week... Aiden gets left out, Atrioc is concerned, and DougDoug doesn't bring up AI Recorded on: May 21, 2025 Clips Channel: https://www.youtube.com/channel/UCurXaZAZPKtl8EgH1ymuZgg Follow us TikTok - https://www.tiktok.com/@thelemonadecast Instagram - https://www.instagram.com/thelemonadecast/ Twitter - https://x.com/LemonadeCast The C-suite Aiden - https://x.com/aidencalvin Atrioc - https://x.com/Atrioc DougDoug - https://x.com/DougDougFood Edited by Aedish - https://x.com/aedishedits New takes on Business, Tech, and Politics. Squeezed fresh every Thursday. #lemonadestand #dougdoug #atrioc #aiden Learn more about your ad choices. Visit podcastchoices.com/adchoices

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Don't many topics today. So many topics? I mean, one comes to my... I can't wrap my head around. We were really busy yesterday. Really? Busy. Oh.

I didn't, couldn't prep as much for the pod. There's a big meeting. A lot of stuff happening. A lot of stuff. We don't talk about everything in our lives. We don't share. I thought we shared things. Some things we do.

I don't want your work and your personal life separate. In the personal life, what we like to do is talk to Governor Gavin Newsom of California. And that's kind of like on our own time. And I feel like we can keep that separated. It doesn't feel like everything has to be a pod thing, Aiden. I don't feel like everything has to be a pod thing. Not even when they introduce you as the hosts of Lemon

Lemonet stand. Oh, yeah. They did not mention. Intro and outroed. They didn't mention that we were YouTubers or streamers. Just the podcast host of Lemonade Stand. I just, that was so funny. It was a recent experience.

This screenshot is real. This is a real screenshot I took on my phone when I was trying to connect it. I saw that there was waiting room 5 in the Discord. And the only two people in it were Atreoc and Gavin. Me and Gavin waiting room five. We're Discord buddies. We chop it up. Chop it up with Gavin.

We're gonna play Valor later. And we're fucking... You're playing Valor and Gavin. And what do I get? What do we? I tune in. I tune in. One, this is what happened.

This is what happened. I want to be clear. This is not a joke. I had no clue this was happening. I had no idea any of this was going on. God. And I get a phone call. I'm just at work, working at my desk.

And I get a phone call. from Brandon and I pick up and he sounds concerned. He's like, I was stressed. Do you have Doug's phone number? It's actually kind of urgent. I'm like, uh,

maybe like I think, and I made a joke. Like, I think I have Doug's social security number, but not his phone number. Yeah. And, which is true.

Which is true. But then I did some dig out. I did find his phone number. Atroc, very concerned on the phone, tells I need to get a hold of Doug, find a way to get a hold of him. He doesn't have his phone number.

I'm like, okay. Like, you know, hang up, go looking for Doug's number, give him a call. Nobody picks up. And then I send Doug the first text I've ever sent him,

which is, yo, this is Aiden. Brandon really needs to get a hold of you. He said it's urgent. Ha ha, ha. I don't know what's going on. And then I decided to tune in to Atriarch Street because he had prefaced the call with the fact that he was live.

And I tune in. I hear the A-Roch looks concerned It's only him in the frame and I can hear someone talking in the background that I don't recognize that is clearly like a tech person who is getting them into a show

and then all of a sudden I read the stream title as they enter the show and call on Gavin Newsome Brandon is interviewing Gavin Newsom on Twitch and I I will life outside of you

okay I watch I'm watching a floor of Twitch chat messages that all say the word boomer in all caps because of the tech issues that you're experiencing and my guess because Doug hasn't isn't on the call yet

I'm guessing that you need Doug's help with something like OBS or tech related and that's why you need to get a hold of it that's fair or something so that's just my guess as to the situation but then a couple minutes later Doug joins the fucking call and then they intro you two as the

host of Lemonade Stand and then the interview with Gavin news some starts. And I'm sitting in my office staring at the screen, dumbfounded, that I'm watching my two co-house interview the governor of California. And I'm finding out right now. We were sure we had mentioned that. I really thought we had mentioned it. That's so funny. Because as I was called, so I gave you little context on my side is I should talk to Aden like every day about at least something. We've hung out with you in person the whole week. We've known about this. My context is I am two minutes from an interview with Gavin Newsom where Doug is supposed

to be there and he's not in the call and they keep asking me about him. And then one minute before he's supposed to go live, he joins, but he's dead silent. And the tech guy is asking Doug point blank, hey, can we get a mic check or something? Says nothing. We're about to go live. Anything you can say, Doug, any words at all? Nothing. Okay, now we're going in with Gavin Newsom. That was my context. So I was not nervous going in, but I'm starting to freak out. Hold on. Perry, Pull this up. Yeah. So this is the action.

This is what it looked like. Aiden, open it up and just saw us just chopping. I think they just got like a different. You know what's crazy? I wish I saw this because Atriox OBS is so fucked up. Why didn't you show the cover? What are you doing?

Was your face. Why did you not show the governor? I added the governor to my OBS. Yeah. And then in the stream, there's a mini governor. Why do you do that? I gave him a picture and picture of himself on his own stream so that my stream be better.

That way all the viewers came to my stream. Just show, just screen grab the whole stream that they were broadcasting. No, no, no, because my display on Discord is my OBS. So if I show the whole street up and he would see a picture and picture of everything, it would be infinite loop. So we don't get into tech issues here. You could have done a screen share. Also, this is fixable.

This is an actual boomer thing that in the, in an interview with the governor of California, you didn't show him, but put a major picture of him. We don't worry about tech. We worry about progress. We learn about future forward solutions. That's true, dude. For California's problems. What I also couldn't believe is that after all of these tech issues, Gavin's team doesn't

have an internet connection, apparently. Oh my God, dude. His voice just kept cutting out. The audio was terrible. I was like, you podcast, you're the governor. Can we not get a couple guys in a, not even our governor can get fiber? Dude, I wanted to make a joke about Spectrum's monopoly in California. you so many times. I was like, I'm going to blow up this whole interview, but, because his tech was

bad. It was terrible. I think maybe they just thought that was you. They just got a different clean-shaven zoomer. Okay. Here's what you have to answer. We should at some point give context for how this happened because it wasn't malicious, but it is funny to not give that for a while, so you can just imagine the worst. I mean, I had my guess. Okay, what do you think happened? This is my guess. I guess. You got reached out to by people on Gavin's team to do this like group interview and they wanted people

who stream and you two are like your co-hosts on a political podcast but you are Twitch streamers and they wanted people to live stream this interview. I do not have that platform. That would be a safe guess. Here's we have no

idea. No, I mean the truth is that Gavin Newsom is biphobic and you know it's funny is he's okay with gay. Like gay is fine, straight is fine. He said, make up your fucking mind. He said pick aside. It's not a fucking buffet. And I thought that was weird, but that was why you weren't invited. The actual origin of this is that I guess an old co-worker of both of us, like, five days ago and was like, hey, we're doing this, this stream. It's this like, I win the fight for Democrats type thing. Would you guys be interested?

interviewing Newsomor, it's like, what? And so then we got on a call, we didn't think to include you. Now that I... We're just scouting report first. Now that I look back on it. And I was like, this sounds cool, but this is clearly, like, I'm not really interested in just like glazing

Gavin Newsom nonstop. That would feel bad. And you mentioned the same thing. So we were like, okay, let's mention that we're interested, but we want to be able to ask like, you know, harder questions, not like be assholes, but, you know, not just be like... Push back a little bit.

So why? Like, I love all the things about the Democrats. And so they were like, yeah. And so then that progressed. Then we had a call with them two days ago. And with like, including the person on Gavin's team who was helping coordinate this. And she was like, oh, yeah, that's totally great. Like, it's not just about Trump.

We want you guys to ask about like what the Democrats can do better. And we're like, that's exactly what we're interested in talking about. That's that'd be really interesting. That's when they're like, oh, you'll be, not super clear what was going on. It'll be like 30 to 40 minutes. And then Harry Sisson will be there moderating. And we're like, is it a debate? Like what?

I wasn't. Dude, the graphic looked like a debate. It was you and me versus Gavin. It looked like we're fighting Gavin Newsom, yeah. Moderated by. And it was a streamer thing. And at no point. Did they mention, did anybody, I'm sorry.

No, they did. They said, listen, here's my top level view is that Democratic Party is freaking out about not having a Joe Rogan, not having a, like, my understanding is they are top to bottom looking for podcast streamer. Anything that can hit a young man. Yeah. And so this is like a, uh, uh, uh, uh, uh, I don't know if a desperation play, but they're like trying to do more outreach things. Their team contacted someone

that we both used to know that is a coworker of ours, Jordan Tayer. And he picked us as streamers. And then that's what happened. I mean, very cool opportunity. Could I levy a critique? No.

No. Next topic. All right. What's your critique? It was softball city, dude. Bro. It was softball city. Okay.

And I'll be honest. We can clarify. Let's clarify. clarify the critique, other guy led the charge on this. Listen, I don't know that guy I'm not trying to be, but that was quite softball as an opener. It was a tough thing to be there as the first question was like,

so why are you so great and everything that Trump is doing is terrible? And it was like, okay. That was exactly, I was like waiting through the first two questions and I was like, what are we doing here? We're like, we're asking Gavin about like, Gavin, how do you get your dick sucks so much? How do you do it?

And I was like, this is not an interview. Okay. What I hate about those questions, what I hate about those questions more than that they're glazing is I think they don't produce. The answer is also nothing. There's nothing. You're not asking the person anything. So the whole interaction,

not only are you not providing me anything valuable. You've also straight up wasting my time. Well, even worse than that, I think if that's the first question, it tunes out a lot of people who are opening, you know what I'm saying? They're like,

oh, this is going to be, and they just don't even listen. Yeah, our questions were, I mean, not critical, what are the Democrats need to do better? It was more like constructive and grounded, which was like what we wanted to do. And then he actually gave like moderate,

you know, I think decent responses to it. Like I wish, both of us talked about it afterwards, like deeply wish this was like a two hour longer thing or we actually talked to him. Because this was, this is again,

this is 30 minutes. They're saying like five to ten minutes of it, Harry gets to talk with questions and then it's Q&A. So us combined, Brennan and I get 10 minutes. Yeah, I stole the Q&A. I didn't even read a chat question. I just gave me.

Really? Yeah, let's go. So, yeah, it was like, we knew going in, it was like, okay, we're just going to have like two questions. And it was, you know, it was like a bummer. It's like somebody on Newsom's team was like, oh, he loves to talk about policy. So we just got to make sure he doesn't dive too deep. And I was like, dude, that's all I would want. Like, I would love to go like an hour and a half into just like specific housing policy stuff. Because the more I was like looking into some of the stuff he's done, I actually really like a lot of what he's done around housing. I was like, damn, I want to like talk to them about this, even though I have a lot of, you know, frustrations with all of it.

Yeah. Yeah, I agree. I mean, and also it's worth mentioning that I plugged our podcast twice. Yeah. And I plugged the yard and you give me no credit for that. I'm literally like funneling Gavin Newsom money straight to you. You plugging the yard is so funny because it almost undoubtedly burns the bridge. Yeah, I want you, you plugged a podcast where we talk about it's every other week.

And we'll have to mute that out right now. That doesn't hurt our chances, right? Now they're like, okay, well, we've got two options. Let's go for lemonade stand. It makes us look better. By better kind of the person. The, the, uh, I do think, I'm not saying that people need to press the person in the way where you like blow up the spot and blow up the interview.

You don't need to be like cruel to the person you're asking questions to, but I do think like Harry leading the charge in the way that he did like softens the whole setting for the interview. I thought the questions that you asked, uh, that you guys asked, uh, were, we're better. and then I was excited for you guys to get to keep asking things and then it just ended. Yeah, there's so little time. And I was like, oh, and then I couldn't help myself.

I started formulating what my questions would have been. I wrote them down here. Into the fucking mirror. So, Gavin, what do you? I wrote them down. I wrote down three questions in my best. Just tears down his face. So what do you think, Gavin?

But I, uh, I, uh, thanks, Kevin. I like that you appreciate the question. Yes, that was a better question than nature I can talk. I'm so glad you said that. Look, I'm happy for you guys. What would you vest?

What would you vest? Yeah, what's your question? We were approached literally. Like, the pitch was almost like, yeah, we want you guys to get on stream and talk about how to fight back against Trump. And like that is, this is like a democratic event, right? Like a Democrat event.

This is very like partisan. And we're trying to inject a more nuanced conversation. What? And then literally we're like, we have 10 to 15 minutes. What would you have said? Okay, on the spot question that I thought of while he was answering one of his, was he had a lot of this vocal support for this abundance movement,

and the book itself shouted out Ezra Klein. Yeah, he's super supportive of it. With that in mind, I was curious, when you look into the support of like the larger corporate benefactors or like philanthropic things behind the abundance movement, there is some questionable big corporate donors, namely some like political think groups that are funded by like the Koch brothers or like Koch brothers funded organizations. So when you look in the background of the funding of the movement, and I say this as somebody

who read the book, enjoyed it, and agrees with a lot of the things in the book, when you look at that and then say you're a fan of the movement and what it stands for, how do you balance that with the fact that it's funded by these big corporate interests? Harry would have cut you off mid-sentence. said, God, I love your hair. You know, nobody needs him. The thing about it is he is so, and it is so late. I thought you're going to ask cut or uncut.

That was a way better question. That was a way better question. We don't need to answer. He's cut, obviously. It's a fair, you know, it's a timing thing. I tried to turn off the, you know, airy open with the glaze and I said, yeah, okay, you know, we agree Trump's chaotic

and not doing well, but Democrats are polling worse. So I tried to, yeah, I tried to, yeah, no, I thought it was fine. And then the other couple things I've wanted to ask him about is he gets kind of railed on because there was a bill in California for universal health care to exist within just the state a few, I think like a couple years ago. And he's often faulted for like the failure of that bill. I think if you look into it, it doesn't like rest so nearly solely as on him as like the narrative suggests. But I was curious of like what he thinks of universal health care being an effort at like a state level in the United States, especially a state level in the United States, especially essentially. state as big as California that seems capable of having the negotiating power, more negotiating power than, you know, a smaller country like Norway, for example, and whether or not those laws that we talked about that limit the U.S.'s ability to negotiate health care costs that we talked about like... Do they apply at a state level?

Did they apply to state level? Is that one of the reasons why this wouldn't work? What's his opinion on that? And then the last thing, I was just asking about structural... Like, he keeps talking about the changes to housing he wants to make. but when we're talking about lowering the value of housing in California, which is like exploded so much, lowering the value of housing is so against the interests of all the people that

own the houses already, especially with how high home values are in California already. How can you, you know, how can you provide and make all these efforts in regards to housing that you say you want to, when the interests of all the existing owners stand against that? And I think he was talking about that a bit,

starting to ask that and then I got cut off because it's like we're going to do Q&A. Like that's literally what I was going to say. It's like you're describing these things. This feels politically untenable as a politician who loses their job if they piss off their constituents. And then, but I was cut off.

And he partially, he even gave me a partial answer to my own question, which was they were talking about how they sued like the city of Huntington Beach regarding their zoning laws and stuff. So it's not, I think genuinely he seems like a guy. It's like as much of a politician as he is, and I understand that. And he's going to answer things.

that political way that I've seen him do many times. He also digs into the details of a few things you ask him about and it's worth a shot to ask these things. So it's too bad that it was just cut so short because I feel like as soon as we got to your guys' questions, it was like, okay, we're finally going somewhere and then it... I sent him an email afterwards and I said, hey, look, that was fun, like for the opportunity.

I think people nowadays will not trust anything a politician says in a sound bite no matter how good. His answers were good, but no matter how good. Yeah. And we would really appreciate a longer form format where we can kind of dive in and see human answers to human questions. We'll see. I mean, they said they'd love to have a follow-up call. Maybe you come on to that.

And we fucking talk about it. We got good feedback from the folks involved. And I think they appreciated that we were bringing that perspective that was not just like, yeah, aren't we awesome? It didn't work. The last election, it's not going to work now. Right. And what makes me hopeful is like I think the Democratic Party does realize how, bad of a position they're in.

And so I think they're at least he does. He kept saying. He does. That was the one. Like he is, he is aware in making strides, you know,

with like his podcast. He's like interviewing Charlie Kirk and stuff like that, right? And so, um, he's at least aware of it. And the folks we spoke to on their team seem like aware of it and very thoughtful. So I'm hopeful that this is,

you know, I don't think that this 30 minutes was anything super impactful. But it could be something that leads to more in depth, you know, impactful conversations, whether that's with us or other people. Because, man,

man, that'd be so, it'd be so sick to really, dive into these details. Can you show us one meme just to close out this discussion? What do you pull it up right now? This in the show links is the latest thing. Is this going to make me feel good or sad?

Also, I just want to reiterate. They, I think what you're saying, like, we're both streamers and they said, oh, you guys are able to co-stream the event if you want. Yeah. And A-Trag was like, yeah, I'll co-stream. I was like, I don't want to. Which just really reinforces why it was us to be there and not you, Aiden. But, I mean, my...

They couldn't have given Twitch.tv. Calvin Aiden a chance. The, not even a Twitch affiliate account. Picture it while playing Mario Kart, dude. Just barely. I think I forgot something. I forgot it wasn't important. Yeah, you're right.

Oh my God. Soccer practice crying. I've seen the fat Aiden version of that photo of me so many times that I thought it just was that. It's just funny because when I called you, I forgot if we told you or not. And I didn't want to bring it up because I didn't want you to fight with me on the air. No, I know. I figured. I figured. And I was, but I told my channel. I was like, I think I told him. And I was wrong. So I felt bad.

Anyway, other stories this week, lots of stuff going on. I think our main topic today is the national debt. Aiden has a presentation. We're going to go into that. But before that, I just had a couple, you know, little things I wanted to bring up. Or if you guys have anything, wait, you know what I was talking about. At some point, I'm going to jam in a quick review of what's going on between Apple and Epic, cool-ass fight. But marketplace of ideas. If you guys don't let me jam it in, I can't talk about it. No, no, we'll do it at the end. Can you pull this stuff?

Everybody wants to talk about the debt, okay? Yeah, I think the debt's the big thing. I think there's a frame it too. It's like, I think the debt sounds boring to some people, but I think most people have this question of like, what the fuck does, sorry, what the hell? Gavin was cursing a lot too, by the way, picking up his habits.

Yeah, Gavin's affecting your language. What the hell does this massive 30 plus trillion national debt mean? What does it mean to me as a citizen? What is the problem? So I think we'll get to that. It's the latest thing in show links, Perry. It's just a couple of funny AI stories. I'll bring the AI stories this time, Doug.

Okay, cool. All villain share it. I think AI is actually bad for society. Okay. Well, that's not villain-share. That's just reverse of view. The Chicago Sun Times, which is where Richard Roper wrote for a while. I used to read his movie reviews there.

They put an AI-generated summer reading list. They didn't tell it it was AI-generated, but it printed a bunch of books that do not exist. It's not. So awesome. Dude, that's fine. But they had real authors. It was like, check out this new book from, you know,

J.K. Rowling, Harry Potter 12. It's like not a real book. This reminds me there's a, there's this board game called Blockbuster where you have to like name movie titles based off of a set topic. Okay. And you go back and forth with two teams.

And if somebody misses, you can call them out. But then if they check in the movie exists, then you can, then you can, uh, then you, then you, like lose more points for doing that.

We play this game all the time with Nick Yingling. He just makes movie names up. Oh, he's just got it like that. Because if they're neutral enough, chances are the movie has been made at that time. And it reminds me of this. You're just like throwing stuff at the wall. Just like deep blue. And it's like

yeah, it's a book. Anyway, I thought this is pretty funny. Just so balzy to write this. It is. To use AI to have it generate the list of books. And they're just publishing. publish it. That's like, you know, we've talked a bunch about AI integration type stuff and like how, for example, in health care, I think the, at least for the foreseeable future, the use case is going to be an expert, somebody who knows healthcare than using AI to help cover certain amounts of the work. And this is the equivalent of a surgeon coming in just like being like, robot, you got this. Just let's just send it, man. It's like, no. So there's no review? This is insane. This is some growing pains. Have you guys seen season five of the wire?

And this also happened with lawyers. So there's a couple lawyers who submitted case review that, you know, made up cases that don't exist. And the judge got furious, obviously. And they didn't get disbarred, but they got a big fine. You can't come in and be like, I'm citing the case of XVX and it's not a real case. So interesting things. And then one more AI news that we'll move on pretty quickly.

But Google had their big Google I.O. announcement where they reviewed. build a ton of new stuff. A lot of it was AI-related. And one of it kind of blew my mind. And it was the VEO, video-generating AI model. I don't know if Perry of you can pull up some of these examples.

Here, we'll watch this one first and just in full with sound because it really explains my thoughts. By the way, this is all AI generated from a prompt. So everything you're seeing, background, character, and voice is all from people just typing in disheveled guy,

rants about. It's like they don't understand that it's coming for all of us. They're making these things smarter and they think they can control it but they can't. You can't control something that thinks faster they're.

It's like they don't understand that it's coming for all of us. You know, it's not that I didn't know this technology was coming or being worked on. It said this is the first time I've seen it where it didn't look like complete slop and it, you know, the voice matches the mouth and it

it all just kind of like shocked me. It reminds me of when I first saw ChatT TBTBT just a few years ago when I was like this feels like wizardry. Matt, you know, it feels like such a big jump. And again, I don't know. I haven't tested this program myself.

But like, look, you can see the prompt up top if you scroll up here. Like, this is what he typed. A dialogue with muffins baking an oven says what it is. And then you watch it and it's like, it's not Pixar good, but it's, it's way better than I thought you could get from a prompt. And the stuff I'd seen before,

like Wilson ate spaghetti and stuff, look like slop. So this is like kind of sort of, spooky. Anyone that works in Hollywood is like extremely spooky. You know, it just, I don't have a thought on it.

I don't have a full form take. In some ways it's kind of cool. In some ways it's extremely scary. I don't know. It definitely makes me worried about like misinformation and stuff as it as, uh, yeah,

I don't know if I could evaluate it with any, any new take from what we've talked about with AI in the past. Like, it's just moving further in the direction of, oh my God, this is so. Like this is generated. This, yeah. Gameplay footage of a fake game is generated.

Let me tie it to a business angle. So this is VO and it's from Google. The door? The door is open but you can still see the side of the car. That's funny. Oh yeah. Yeah, that's going to miss things like that. That's funny.

So this is from Google. And this model, VO2, which is the version before this, which is out, I want to say, six, seven, eight months ago, but not even broad. publicly available was already way better than everybody else's. And now this came out and this is just like blowing it out of the water, particularly with realistic

looking video, right? Like this is really cool, but the guy's the one of the guy running or yelling in the street, it's like shockingly accurate. So one of the one, the one of the guy running? Yeah. I don't, like if I just saw this, I don't think I would have been out. Like if this is an ad on TV for like a,

you know, medical something, a pill or something. I would believe that's real. Yeah. So the big differentiator here is that Google owns or Alphabet owns YouTube. And that is an absolutely unfathomably large amount of video data. So if you think about most AI stuff so far, it's been images and text, those are both really, really, really easy to copy. It's easy to copy books. It's easy to grab images from all of the internet, right? It's very hard to enforce the kind of like containment of images and text, whereas with video, it's much

easier to be, let's say, restrictive with other people accessing it. So like movies, there's an, you know, there's a whole industries have invested decades of time into protecting movies from being streamed illegally or shared illegally. YouTube has their whole copyright system. So if you imagine an AI company that enters the space and wants to create a video generator, right, they, the most important thing, arguably, is data, getting a vast, vast, vast amount of video data because there are so many different pieces and elements that you need to consider that, you know, it's like that car door.

It's like tiny things like that. It's like the more data you can get to just cover all the edge cases. Yeah. The amount of video data that YouTube has is unfathomable. paired to anybody else. If you compare it to like Netflix, Netflix has a great library, but I don't know what percentage it would be, but Google's got, I don't know, how many. If people start auto generating marketing Mondays, I'm going to kill myself. If they're training on my shit.

Oh, there already are. But our podcast, we're going to train on a podcast and generate lemonade stands. We're playing into it. So what's interesting about video AI specifically is my theory has been for a while, and this to me makes me more confident in it, is that Google is going to absolutely. dominate everybody else in terms of video generation because the amount of data and resources they have every day people are posting videos of themselves all over the place even on something like you know x the everything app or facebook there's just a lot less of that and so this is going to be they might not have like house of cards they've got they've got me at the zoo they've got

lemonade stand you'd rather have one billion images of people like doing makeup tutorials than having one season of house of cards on netflix right so i think that google and alphababre will be positioned in terms of like this specific area of AI to just be like just so incredibly dominant compared to anyone else, which I think is pretty interesting. Yeah, it's, it's, I mean, the technology is very cool. Obviously, I'm spooked by it at first glance. Dude, I saw someone typed in the prompt that was just like, guy on stage at a comedy club gives a funny joke.

He didn't even say what the joke was. And it generates a realistically guy on stage and he goes, yeah, I went to a zoo recently. It only has one small dog. It was a shit zoo. And the crowd laughs. And I was like, bro, that's not like the greatest joke in the world. It was pretty good. I wouldn't come up that joke on the spot.

And it generated that and it looked real. And I was like, it was like, that's crazy. That's so far beyond what I thought it could do off a prompt. You type that in. It spits out a clip of Kramer at the laugh factory. Whoa, Google. Oh, dude. I have a little class, a little ticked.

Oh, we're pulling. from all the videos I see. Not everything's training day. I would love to see a model based off Twitch, right? It's just like, it's just like slurs and busty people. That's a lot of, anyway, you know, a small little story. We'll probably follow up on that more.

I do agree with you that, you know, what I've heard business side of AI right now is that Google is leading in all of the models but hasn't quite broken into the consumer the way that's chat you BTS. So like, it's this weird battle where will the best technology win or the guy that has the advantage early win.

In this case, I think when it comes to video, they're just going to absolutely dominate. I mean, if you compare the VO videos to anything else on the market, like nothing, everything else has that weird uncanny Valley AI feel. This stuff is shockingly close. I'm wondering if government will regulate.

You know, if this gets good enough, it feels like the government may mandate Google have to include a tag or something on it. A watermark. A watermark that you know it's AI because this is going to, buck with people. I mean, people on Facebook are already falling for AI

brain rot and it looks like trash. If this looks real and it's like a video of Gavin Newsom saying, I hate you know, ex-race of people or something. Bisexuals, yeah. Bisexual. You did say that, so that's a real video. YouTube shorts is feeding me videos of weirdly animated cats with like remixed version

of Katie Perry songs that go meow, meow, meow, meow, meow. It's just, I already live in hell world. I'm getting gorgeous country singers all AI generated who are like badly singing to songs and it has one view and we're like, why are you giving this to me? What is this flower?

I have basketball, guys. That's weird as fucking... Rhythm reflects you, buddy. Anyway, that's that story. I don't know if... Yeah, okay. Is there... And it costs so much to train these things

that's putting these companies into debt. Okay. Whoa. Let me set me... That's pretty good. That's the kind of stuff that gets us on an interview with Gavin Newside. That's the big buck stuff. You wouldn't get it.

So today, as we're recording this, this is Wednesday, it'll be live on Thursday. The stock market, which has been out of a bit of a rally recently, had a big drop, and it was because the United States went out to the bond market,

tried to borrow money for its many, many debts, and there was almost no bid, and they had to spike up how much the borrowing costs. So we broke, I don't know, four and a half to five percent today, which is like a really, really high number. And we have things like this where the IMF is now talking to us

like we're developing country. IMF is like, hey, you have to watch your job. deficit, you can't afford your death. This is how they talk to like, for example, Greece. They talk to, this is how they've talked to like the poor countries for a long time. And they're talking to America this way because we have literally gone off the rails with the amount of debt, the amount of spending, and zero effort. I don't care what the fuck you say about Doge. We've made zero real effort to balance it in any way. And we're in fact proposing a

massive tax cut for the rich, which is going to decrease our income. You know, so we, we, we ended that study about transgender mice. That was eight. That was eight million. No, that was eight million. So we're working on. Finally.

It's balancing. Yeah. That was what's holding us back. It would be the eye. That's fine. So anyway, that kicks off a large discussion about the debt,

but that story is happening now today. That like our borrowing costs are getting higher and higher than other developed countries because people don't trust us to pay it back. They're like asking for more return when they give us money. And which leads us to Aiden's discussion

on the national debt. I asked the discord. What do you guys think about the debt? and the most common sentiment is fuck the debt. What does it even mean? These are big numbers. They don't actually mean anything.

They're so big that they're out of reality and like, whatever, let's just keep ignoring it. I mean, I think... That wasn't a question. I feel that way. It's not a question, but I think it's how people feel. And that was the baseline for what I wanted to talk about

because I think we spent a lot of time on the show talking about how the debt exists, what the U.S. debt specifically is made of, efforts to cut it. you know, whether or not those efforts have been genuine or successful. But I think that conversation often skips over why this actually matters at all. I think, I thought I was it. Maybe I should go up today.

Get up. Let's go. Aiden on the presentation, boy. This is a big day, dude. You know what it is? He's feeling bad about the Gavin thing. He's trying to step up. He wants Gavin to notice him.

And absolutely is a good solution to Discord. I hope you incorporate. Gavin, Gavin, I'll be in Castro on Thursday night at 10 p.m. Okay, this is grace. Greece. Beautiful country. What do you guys know about Greece? Any thoughts?

They lost the Peloponnesian War. The Civil War. So they did lose if you think about that. They also won. It's beautiful. It has a big debt problem. is my understanding, and they have good food. And nice islands, rich people use their islands.

I think all those things are pretty true. Well, the thing is, you're right about the debt. Greece famously had a debt crisis after the 2008 financial crisis, you know, in the United States, the whole world, and their debt crisis really hit the fan in 2009. Okay. And there's a few numbers and stats behind that as to like how they, you know, how they got there in the first place, you know, what that actually built up into. I think the short version of how they got there is they ran extraordinary deficits

through the good times. Before 2008, Greece was like a pretty nice place to live for the average person. There was a lot of like support that the average person had through the government, but they also had a lot of issues with taxes not being paid, not just by the wealthy and like riches companies, but also small businesses and average citizens, finding a lot of ways to dodge taxes and accountability, all the while spending going crazy throughout that whole time, and, you know, times remaining good through all of that. And then the, starting in 2009, this debt crisis really starts to build. They've been deficit spending for years, and even

before the debt crisis, their debt to GDP ratio was already past 100%. There were already at 103% before this crisis really started. Before 08. Before, sorry, this is in 2007, yeah. The unemployment rate in 2007, 8.4%. The debt to GDP ratio, 103%. Okay. The way we qualify debt to GDP in a general sense is if you're past 90%,

like if you're in that 90 to like 120 range, you're considered to be like pretty high risk already. Professor Auden, I have a question. Why does that matter? Why does the GDP related to your debt matter? Well, well, well, Doug, great question because we're actually just about to answer that. Because I hear that all the time. I don't really get it. We talk about debt to GDP all the time. So why does that actually matter? Before we talk about why it matters, I just want to give you an outlook on that specific stat as it builds over the years.

And just focus on the number for now. So in 2007, it was 103%. 2009, at the beginning of the debt crisis, the debt to GDP ratio is 128%. In 2013, it's 175%. And then in 2020, it peaked at 253%. So why does debt to GDP... Oh my God, did you ask that question knowing or...

No. You set them up. To answer Doug's question, why does debt to GDP actually matter? Basically, this number boils down to a signifier to other people in the world, investors, how likely you are to be able to pay your debt back in the future. Your GDP sort of represents your country's capacity to generate payments on the debt that it owes, because that's basically the peak amount of movable money in your economy. So how your debt compares to that total represents how likely you are to be able to pay

that debt actually. How are you going to default as that number climbs people that invest in your country by the bonds that are the debt that your country is accumulating? They're more worried about the likelihood of actually getting a return on the money invested into that country. So if we go back a little bit through this crisis, the other thing that you can watch is the interest rate on Greece's bonds. So we've talked a lot about treasury bonds in general and on the show and how the U.S. raises money by issuing treasury bonds with interest rates on those loans, right? Greece does the same thing. All these countries release their own bonds to raise money that has interest rates on it. Yep. And over the years, before the debt crisis started,

the interest rates were relatively low, 4.5% on the 10-year bonds that Greece would issue. And then right at the beginning of the crisis, they climbed to 5.5 slowly, but by 2011, it's 15%. And then by 2012, they peak at a rate of 29% of February in that year, a 29% return on a 10-year bond. Keep in mind when we're looking at like U.S. Treasury bonds, when U.S. bonds, like you just said, find it like 5%. It's a panic. That's crazy. Yeah. So Greece hit a scale where they had almost 30% return on these bonds. Desperately trying to get people to buy them. They have to pay me 300 grand every year. That's right. Yeah. That's so sick. Damn. And you know, just to be clear, to get the context, I think Ukraine war bonds right now,

which are the worst in the world, are like 40%. So it's like, and people don't even know if that country will exist. Like, that's an incredibly high risk. And they, so to get to this high, I mean, I didn't know this, but like this is end of country type. I mean, that's when you get that high, you can't afford your government. Yeah, that's what they, that's what they climbed up to, right? So through all of this, we, you know, Greece, you know, as far as I know, is still here. Yeah.

It's still... Imagine it wasn't. It's still a country. I don't know. If anybody has a crazy update for me. Like, Greece has not existed for 10 years. Starting next week's episode with the most insane correction. But so what actually happened in Greece, like through this crisis?

What do these numbers actually mean for the country and for the people that live there during that time? So, unemployment skyrocketed. I already talked about that. and there was a massive loss in the GDP of the country, which is part of the reason why the debt to GDP ratio got so crazy. Right. Is because the GDP was actually declining. And poverty just greatly increased. There's people with left jobs, less money to spend.

And then in turn, all those people who are impoverished now start to turn to social services. There's more people who need those services, but also less of a funding mechanism for those services to even exist. Right. So the services that people would rely on in times of crisis no longer function, which is a big... The government is collecting fewer taxes but has to spend more on social services.

And that's bad. They don't have the money. They want to. They want to, but they had to end up making concessions. This is kind of the catch-22, and I think is what the thesis of the problem of debt, is when you choose to spend money in the good times, when the bad times finally come, you cannot use the tools

to get yourself out of the bad times anymore. You can't weather the storm. And that's kind of what happened to Greece is because everything was so good while they were running these deficits up, but they weren't saving and had a proper financial approach prior to when a crisis finally hit.

And then when it did hit, all of the options that they had to get out of the crisis were exhausted. So when you're in a crisis, or maybe in general, you basically have three ways to create money that you could spend, right?

One way is you could raise taxes. You could collect taxes like the sheriff of Nottingham right here. And in crisis, the problem is this puts an additional stress on the average person. Instead of giving them money that they might need to spend

in these critical times, you're taking money away from them and putting strain on the average person that's being affected by the crisis to begin with. The other problem with taxation is that it's slow. It takes a while to collect taxes, and you also need a mechanism to enforce and collect them in the first place,

which is something that Greece was having trouble with. And then, on the other hand, you could issue debt. More debt. You could sell more debt to continue spending your way out of the crisis and keep building on top of that. And the other thing, which Greece could not do, was you could print your own money if you control it. If you could choose to hit the printing press, make more money,

and then throw that in the system and hope that works out. All three of these things have their own different constraints. Right. Why couldn't Greece print their own? Is it because the EU? Yeah, because they're a part of the EU. They don't have control over. They only have the euro and they don't have control over issuing that amount of money.

So they have to turn to the rest of the EU for loans with austerity measures. And as a result, one of the other consequences that Grace has faced over the last 10 years, is they've lost a lot of their sovereignty. They can't make a lot of the decisions that an average country can on their own because they have to comply with whatever the restrictions of the loans are from the rest of the EU.

There's benefits to that, though. There's a reason they didn't just leave the EU, make their own currency and print it. Hello, Atriott. You mentioned that there's benefits that they didn't leave the EU and that they didn't choose to print their own money. They got to participate in the system.

What would you say the benefits are? Well, it's sound currency. People trust the currency and are willing to loan in it. Like Argentina printed their own money in a similar situation, and they got hyperinflation. They got, you know, you print a bunch of money to solve the problem. It doesn't solve the problem. The price of everything goes up. Your country can no longer get loans because no one trusts the value of your money.

You know, there's a reason people want to be in a stable thing like the EU because it gives their currency value. Exactly. So each of these two things has their own set of consequences, right? If you print too much, you create inflation. Also, if you do print money, you ideally want to fit within the industrial capacity of your nation. If you can print money while your economy is still growing and you're throwing money into a system that basically can accommodate for that additional money to exist, you're not going to create inflation. An example of this is like after a crisis starts and a bunch of businesses start to crumble and fail, when you get, give that money to people to spend on things,

if all the things that they would have spent the money on have already gone away, in the short term, all of that money is getting spent on the remaining industries that do exist, and it's more likely to create inflation. So there's an additional risk there, depending on the timing of when you choose to rent the money. This is also part of why having a really strong,

diversified economy is important, so that when you finally do hit a crisis, that money that you insert back into the system has a lot of different places to be spent on things so that the recovery is stronger. And then the major, major issue that is most likely to hit the U.S. and that Greece was dealing with is when you choose to continue issuing debt for your spending, we encounter this problem where you need to keep raising interest rates to get people to buy it. This compounds with the fact that if a bunch of people own your debt already and they're losing faith,

they start to offload the debt that they owe from your, that they own already and sell it into a market that forces the remaining country that's issuing the debt to keep raising interest rates even higher. So these things are building on top of each other. It's like a negative feedback loop. The key thing here is that raising, raising money through debt or printing money can be worth it if the economy grows alongside with the spend.

you want basically whatever you're spending to contribute enough to GDP that GDP starts to outpace the debt people have more confidence in your economy again you can bring the interest rates back down and then the average person has an economy they can actually participate

live and benefit for it makes sense and then this kind of this brings us to America oh shit we got the Poland ball we got the the United States there are things that are the same for the US as Greece, and also things that are different

that are really critical. And I just wanted to lay that groundwork of what went wrong for Greece to give you an idea of the direction that the US could be heading in, but also, you know, you know, how we're gonna deal with the difference. One way to get out of is look cool as hell, dude.

Yeah, I do think. So actually, question for other one of you guys. What, so what you just described with Greece sounds horrific. I've heard about this from the onset, but never looked into the details of it. Like, are they okay as a country? able to do anything? I mean, that seems like literally country ruining from what we were just looking

at. So it kind of was. Like, they are recovering now. The GDP has recovered to a point finally, as of 2022, where they were before the 2008 crisis. And that's accounting for inflation as well. The other thing is they didn't really reduce the debt through this time period. There have been like one year sections where the debt has gone down. But mostly the debt has actually grown over that time, and it's been about recovering GDP to get back to a better ratio. They're just trying to outgrow it, basically. Yeah, they're trying to outpace their debt. We'll just try to grow faster than our debt. Okay. Exactly. That's their way out of this, because the level of debt that they have, it's the realistic outcome of being able to pay all of that off any time in the near future is really low.

It will have to be paid off and dealt with eventually, and it is something that's being mitigated now. the burden of the austerity and paying off the debt is something that will saddle Greeks for generations. Like it will be the Greeks of future generations who will have to deal with the consequences of that debt. And that's the thing like right now, like presuming living, and actually if people live in Greece, I would love to hear thoughts on this. Presumably, it's like you have access to way less government resources and opportunities

and all the stuff because the government can't generate money to fund things, right? I mean, just at its core. My understanding is, you can tell me about wrong. But since 2022, in recent years, they've been on a bit of an upswing. Okay. There's a lot of tourism to Greece bringing in new money. And so they've finally weathered some of the really, the super high unemployment, super high the GDP era.

But it still feels like they're incredibly restricted in their ability to invest in their own country, right? They are hamstrung in that way, yes. I mean, they get these big bailout loans from the rest of the EU, who doesn't want them to fail because it'll bring down their whole currency. Got it. They've gotten these bailout loans

that allow them to fund the government and keep things going and they have slowly gotten into a more balanced deficit thing where the deficit spending is mostly going to productive. They have to make the hard choices. They'd make hard choices of like,

what are we going to spend on that actually grows GDP? So is that maybe an option for the US? We asked the EU for a big bailout. There we go. Wow. And to be honest, Doug, that's not in this presentation

and I hadn't even thought of that. That's cool outside the box. Problems sold again. Lemonade stand doesn't done that. Why haven't we done that? You're exactly right though. The trajectory for Greece is getting better, but I think the key thing here is with all of that help from the European Union, they're still in a spot where the road to recovery has been extremely long and is still ongoing now. And the real world consequences of this is like the suicide rate almost doubling within that time.

going from like, I think it was like a little less than three deaths per like 100,000 people to more than five at the peak. Like those are the real life consequences for average people. And, you know, the average Greek has less access to like social services and government money and a change in their day-to-day lifestyle than they used to. There's a bunch of historical context behind like what led up to the crisis that I think is interesting. That's the big one. Peloponnesian war.

If you really did. But I think it's a huge change of lifestyle for the average Greek person within that time. And the recovery will still take a long time from now. Things have been good in like the, or better in the last couple years specifically. Not awful anymore.

Okay. So when we look, basically the, keep in mind, debt to GDP is the signifier to the rest of the world of like how good you are to invest in. That's why it's important. It's like this alarm bell

that signifies where you generally stand with your debt and how likely you are to pay it off in the future. So when we look at the debt to GDP of us, of America, in 2000, it was only 55%, which below 60 is like you're fine, baby. That's so awesome. I can't believe that was in my life. That's beast mode. And then by 2007, it actually, it had risen,

it hadn't risen by that much. It was 62% in 2007. But then here's where the number changes rather significantly. 2009, it's 82%. In 2015, it's 100%. And in 2020, it's 124%. Wait, right now we're at 124%. Yeah.

So what? I thought we were under 100. Also, post-COVID. We're at 120 plus. Oh, my God. We did go down. Like, in COVID, it's spiked to 124, right? And we went down a little bit in the next couple years.

but now as of 2024 and into 2025, we're back at that 124% mark. Okay. What is that? There's no hard rules about this debt to GDP number, but once you pass 120%, you're past the range that's considered high risk. You're above high risk as far as loaning or purchasing your debt goes.

Just to make, and just to ground it and make sure, so our GDP, the amount of economic activity that we have a given year, our debt is now a 120% of that. Yes. It is that much higher. It's horrendous. Can I call it a couple years?

That's bad. You know, year 2000, that is the year right before the end of the tech bubble. And that is when Bill Clinton is still president. They have a, it's the last time in my lifetime,

in any of our lifetimes, we've had a budget surplus in America. That was the last time we spent less than we raised in taxes. And we hand that off to George Bush in 2000, 2001. The election is 2000, he gets in 2001. And obviously, he didn't make 9-11 happen.

I'm not going to make this. But ever since, you know, his idea of what to do with his surplus is, are we're going to do a massive tax cut because we have money to give back and we're going to get into two wars. And those cost a lot of money. And even through all that, we only got the 60% debt of fee. And then we get the financial crisis and then it goes crazy. But it is choices that we made with a relatively low debt and budget.

surplus that have now put us on a spiral towards a fifth of all our taxes going to interest debt. Yeah. Like that, okay, I just, you know. And it's, and it's climbing and building on, it's spiraling out of control. And right now, we haven't hit an insane crisis again yet. But I think the important part to keep in mind from earlier is the problem is when you spend money when times are good, when the shit really hits the fan, you're not able to make the

decisions you want to to be able to get your way out of the crisis. And so how is the U.S. a little different than Greece? For one, we can print our own money. We control the U.S. dollar. But there's an additional layer to that. The dollar is the world's reserve currency, which means when people are making foreign good trades or foreign exchange trades, the dollar is frequently involved in almost 90% of all foreign exchange trades, the U.S. dollar is one of the items being exchanged, which is crazy.

And that's like two non-American companies, right? You're saying like if some European country is trading with a South American country, they're going to use dollars. Exactly. And that's why the reserve currency part is so important. It's not just when the U.S. is trading with other people because we obviously import a ton of things and we export a lot of stuff as well, but it's when two countries that are totally different than us are trading with each other. the thing or the idea here that separates us from Greece is GDP might not be the marker that it is for so many other countries. The argument is that we could push a lot further with our debt than most other people could safely. It depends on what the other countries in the world actually believe.

I'm sure you have some thoughts on this. I disagree. Yeah. There's, and I'm kind of touching on this idea of modern monetary theory, which is I don't want to dig into too much. but the base idea is that because we're the world reserve currency and so much of the US dollar is used and spent and accounted for outside of our GDP, we have way more leeway to take on debt

than any other country could, even if they can print their own money. But, you know, that all depends on the rest of the world's faith in your position. And so Moody's, as we talked about last week, recently downgraded us from AAA to double A to double A to double a U.S. government bonds from discouraging people's investment in them. And I do think this is a good point. Like this all depends on like what other people's faith in buying our debt actually is.

And you brought up how recently we had to up the interest rates to 5% because we had no buyers at a lower rate than that. But I think something important to keep in mind when I looked at the credit ratings of all the countries in the world right now, us getting town graded to double A is like us falling to like seventh in standing on Moody's list. We're still incredibly high as far as credit rating goes among the entire world. And although it's a reflection of some of that faith declining, we're still in a position that it was much higher than Greece is going into the crisis. Part of the reason why the 2008 crisis hit Greece so hard was they were already considered to be so fragile and risky to invest in prior to that crisis hitting. And then when all of this,

you know, when the global economy collapse, people pulled their money out of of risky Greece, and then it triggers a bunch of things there. The main thing here is that eventually you will reach a breaking point. We don't know what the breaking point is in the U.S. The idea that you could push it further than most other countries could go may or may not be true, but whether you agree with that or not, eventually there is a tipping point with the debt where we will face the consequences of it, most likely when some sort of inflection point or crisis hits. I wanted to come back to Greece at the end of this,

because in the buildup to their crisis, there's something that I found particularly scary. So if you go back, like, decades ago, into the 50s, 60s, they had a right-wing, a popular, like, liberal right-wing party that set up a lot of, or furthered a lot of the institutions within Greece that allowed, like, taxes to go by, non-meritocratic government positions, all of these things that, like, compounded and built.

And then eventually, in the 70s, this socialist party comes into power. A socialist Democrat party comes in Greece. And they, rather than changing anything super significantly at an institutional level, they start a bunch of programs that give a ton of money and jobs out to the average person, rather than just helping corporations and private interests.

So the lifestyle of the average Greek during that time period does get better. But the deficit spending to do that and the lack of taxation to do that never stopped. So the deficit through this whole period. They didn't raise taxes? They did it. Sorry, they did on paper. But a big problem in Greece is that nobody paid them. But a big problem in Greece is that nobody actually paid their taxes.

Not just corporations and like really rich people, but average people too. There's some crazy stat. It's like a third. There's like a third of Greek businesses existed in this shadow economy that just refused to pay taxes. Sounds cool. A different anecdote of water is, you know, really limited in Greece or in Athens specifically. And if you had a private pool on your property, you have to register that and pay a tax to use water in that way. And if you look at an overhead view of all of Athens, you can see pools everywhere.

And before 2008, only three pools in Athens were registered on the list. And because people just didn't want to pay the tax and there was no enforcement mechanism for this. So they're not collecting taxes. They're spending a bunch of money on really cool, nice social programs that go to people. And a lot of people got jobs with the government

that they did not necessarily have to work. They were this big problem in Greece with these things called ghost jobs. in the government where people would collect a paycheck and not actually do anything. This, during the crisis, one in every three people

that got laid off was a private sector employee. The other two were public sector employees. Oh, damn. Which is a crazy, crazy ratio. And... Do you know what percent of their jobs were public versus private in Greece before the crisis?

Do you have that? You may not know. I'm just sure. Yeah, I don't have the percentage breakdown, but in a population of like 10 million people in 2007, 700,000 jobs were in the public sector. Okay, that seems low. Which is, I think that's pretty significant.

Yeah, but percentage-wise, like in America, for example, I think something like 25, 30% of all jobs are public. Oh, for real? Yeah, I know that, like, in China, it's 8020, it's higher in America than public jobs. Right. A good number of jobs are... I think the ratio of people in public sector jobs

wasn't necessarily crazy compared to private sector employment, but the layoffs in the two were very disproportionate. Okay. I wouldn't want to do it. And the main concerning thing here is that no matter who was it politically in power,

whether it be a more left-leaning party that had a ton of these social programs that benefited the average person, or whether it was the liberal right-wing party that was supposedly more concerned about budgets and spending less and being more conservative, neither of them ever addressed the debt issue.

They never wanted to get ahead of it. They continued spending threat this whole period. Luckily in America, we all take it real serious. We're very proactive about it. People make the hard choices. They rode the debt train into the sunset. And then eventually they paid the consequences for it. And all of the future Greek...

And the sunset was one of those old-timey Hollywood. would sets and they just crash into the wall. It's just chasing the roadrunner. Without the LIDAR, dude. But basically we, I feel that is the most damning similarity where no matter who is in power, no matter what the like day-to-day benefit of the spending is, we are on track to continue spending money in the fashion that we are with no real solution to stop the growth of the debt.

Yeah, the exponential growth. I think that's the, that's what's so scary about it to me in America and at the end of Greece's life cycle is like the, even if you are the same amount of bad as a previous one, the problem is now worse, previous administration, because it gets exponential. The more you spend on interest, the more you have to borrow to keep up to your normal payments, and then you're spending more on interest. And then eventually half your government budget's going to interest, then you're borrowing it's a high cost.

And it just eats up your entire, you know, economy. It's end-of-cycle stuff. I'm going to turn off presentation voice for a second. Okay. On this last point, and something that I had been thinking about a lot, is I think when people view policy through the dichotomy of right versus left, how money should be spent by the government on social programs, how it should benefit the average person,

I think in a general sense, we could make strong arguments for why the government supporting people is really, really good, right? But regardless of where you stand on how that government money should be spent, in this situation in Greece, it didn't matter what, like, the political or ideological direction of the country was if they didn't address the underlying mechanism

of the debt growing. It doesn't matter what sort of political sheen you place on top of a system that is dependent on you borrowing money for it to function. Eventually, you have to take ownership of the debt. And I think another example

I could think of was Venezuela where socialist country why can I not think of the word starts with an A. Atriot. Fucking... Avon Newsome.

Argentina? No, dictator... Why can I not think of the word right now? Authoritarian. Socialist, but authoritarian. But Venezuela was a very successful country in South America for large segments of time

because they used the oil money that they collected from their nationalized oil company, spread it around the country, used it to benefit a bunch of social programs and corrupt government officials, but they benefited the people along the way and a lot of people were happy when that was happening. But all of that was dependent, you know, whether you agree with the idealized,

aspect of spreading that money around, which I think in principle is a good thing, the underlying mechanism of it all being dependent on one commodity is bad. And whether or not you believe that there was foreign interference from other people that exacerbated the problem in the first place, you know, CIA in jokes incoming, whether you believe that or not, the idea that your whole fiscal policy rests on the value of one commodity is an issue no matter what. And the same thing goes here is like the issue of your debt

is an issue no matter what. You have to address it regardless of the political ideology you agree. You're spitting, bro. I agree. It's frustrating to me. It's for even people that like,

there's people who have gotten such a reputation. Someone like a Ronald Reagan, people think of him as like he was this austerity, neoliberal guy who like cut our shit to help our debt or to balance the budget.

He did cut shit, but he did cut shit, But he did not, he blew the budget out. He spent more than anybody before him just on shit like the military and police states. Like it doesn't, these people who get this reputation on either side of the political spectrum are lying. They've all been, except for maybe Bill fucking Clinton. But outside of them, everyone has lied about reducing the deficit. And he had it, he had like easy mode dark souls.

He played a magic caster in dark souls. He had a tech boom in his economy. It was really easy to raise a lot of taxes. But like, nobody has ever done the hard choice of like, all right, we think. you have to raise taxes or cuts, but we have to find some way of like, and by the way, you know, it's like it's impossible, because if you look at America in like 50s, 60s, and 70s, we run basically flat debt, like no deficit.

So I think that's an important part to stress here. And what I was hoping to get across is during, if you go back to like the Great Depression, right, we ran huge deficits to accomplish the new deal spending that came alongside at the time, right? Yeah, and the war. But the point of, the new deal spending, even before the war,

we were on a recovery trajectory. I think that's really important to emphasize is the new deal came into place before the war was happening for America, or we had made significant deals with the UK to mobilize for them. And during that time, we were running deficits to fuel the recovery.

And that is fine when you have the room to continue spending or creating those deficits. We had super low debt to GDP and before. And that's the problem is like during these really good economic times that we've had during periods of time in like the last decades, right, we've chosen to continue running the deficits no matter what. So when you're faced with the next Great Depression scenario, you can't just spend as much money as you want to get out of it anymore because you're more likely to hit the ceiling. I think that's the part I want to stress so much is like spending and running deficits for periods of time to deal with crises is important. It's like how you navigate those things. And countries that save and manage their finances well navigate crises by doing that because they've saved for those moments. But we haven't saved.

We've done the opposite. So when the shit finally hits the fan, we don't have the room to just turn on the money printer anymore. Can I summarize this from my understanding? And please, the business majors, tell me if I have this correct. So I feel like we all talk about the debt, the deficit, and it's big and scary. but we can kind of ignore it right now because our credit rating is still good enough and we're the reserve currency

so everybody in the world or almost everybody in the world was still willing to give us money even though we spend more than we make every year we need to get that money somewhere everybody's willing to give it to us but at some point there is a breaking point which suddenly they don't want to do that

and then the only ways that we get out of it are by raising taxes a lot or by printing money and potentially doing inflation. Is that the correct understanding? Like it's kind of okay right now because we just keep borrowing more to deal with it

but there will be a turning point at which the rest of the world is like, we're not fucking lending you money anymore. My answer to that would be, I think that point is very close to right now. Right. In that... But, like, am I correct in understanding that the reason it's so easy to ignore is because it'll probably happen all at once, right?

Like, there'll be this sudden transition of the rest of the world going like, hold on, no. And the instant a couple people say, we're not buying this stuff anymore, the rest of the people will. Like, it's not as gradual as... The numbers look gradual, but in practice we will just hit this point

that is suddenly catastrophic. I think the reason it's easy to ignore is because any movement in the opposite trend, especially because the exponential build that you're talking about, any turning it around has become increasingly hard over time and all of the actions that start to turn it around are politically unpopular for the average person.

So someone to actually come out and substantially approach tackling the debt is saying like, let me make these really unpopular decisions before the really, really bad thing happens. Right. But the really bad thing could happen at any moment now, right? Any moment. Okay.

So we're just hoping that that doesn't happen. And I want to say, like you said it happens all at one. I do think it'll appear that way, but it's happening gradually right now in that. Sure, to the average person, it would be like, whoa, what the fuck just happened? Yes, for sure. Okay. Okay. This is where I want to ask you a question. Okay. Because you are the most, I think you are more dumer about this.

than I am. And as I grazed modern monetary theory, this idea that the U.S. has the ability to spend and take on way more debt than other countries because of the unique position that we're in. I'll be it with some changes

that Trump has started to make in his administration, that he's pulling away the value of like the U.S. dollars, the reserve currency. Right. With that mind, why do you think we don't have

much more room to go? Because countries like Japan have like a way higher debt to GD GDP ratio and Japan hasn't collapsed yet. I think Japan is the canary in the coal mine of where we're going. Japan is not collapsed, but they're having the problems right. Like Japan's borrowing costs are spiking right now and they have 240% debt GDP. So they spend way more every year than they make?

They have completely run out of room. In fact, nobody will buy their debt so they print their own money to buy their debt from themselves to keep the borrowing cost down. Okay. It's called quantitative easing. They're at the end of the cycle. They have run out of options. And as Japan goes, we'll be able to see what's sort of happening.

But what I want to say is the things that we're talking about the negative impacts of the debt, like people are not going to want to buy it, are happening as we speak. China used to be the second, actually, I think the largest holder of our debt, then became the second, is now the third behind the UK. Every time we trade with China, we get their stuff, they get dollars. They used to take those dollars and buy our debt with them. It was a perfect cycle for us. We got goods and they got IOUs.

It was great. They have now realized this system sucks for them. They don't want it. So they've taken those dollars and they buy other things. They are now building trade networks with other bricks currencies where they trade in their own local currencies

and they are buying gold and other things with the extra money. So they are slowly reducing their holdings of their debt. It's happening slowly, but eventually, every time a country does that, like China's doing it, many countries are doing, we go to the market and go, hey, we have debt who wants to buy it,

less and less people are showing up. China used to show up in big numbers. They don't show up at all now. They barely. So we're hitting the constraints right now where we can no longer fund the exorbitant spending we are doing. And we have so much privilege.

We have such a good economy. We have the World Reserve currency that we can make this last longer, as you said. But getting downgraded is the world saying that this is not trustworthy. They're looking at how much we're spending and they're looking at us planning to cut taxes.

And they're like, a minute. There's no real as a chance we get paid back. And they're demanding more and more. It's happening as we speak. So, you know, when you're below 120% dead GDP, it's something you can ignore. It's something you can just keep pushing off. But I think when you hit that 120 mark, generally historically, at a lot of countries, that's when it starts to become a real problem. That's when it starts to become so much of what you're raising in taxes is going toward interest. And when you're spending more on interest than your military, and that's just money being burnt, you've now hit a part where it's like really negative compounding effects.

So that's why I talk about it. So I don't want to say Dumer, but I just think I'm more, the more I read about it, the more I study it, the more it's like, it's a crisis that is just ignored. It's complete blinders on because as you say, anyone that tries to fix it is going to make unpopular choices. They have to do things that are unpopular. They have to cut military spending or they have to find a way to make Medicare and Social Security more efficient or cut them.

I don't think you should cut them, but find some way to, because that's all. All the money's going. Yeah. We're raising all these taxes and we're spending these things and we don't have enough money in taxes to spend them. So we have to keep borrowing. And that's unsustainable. It's just not, of course, that doesn't make sense long term.

I don't trust any system that tells you that it can do that. Historically, that has never worked out that way. You know, Rome tried this. Every country has tried this and they've all ended up in hyperinflation or default or disaster. There's nobody who's pulled this off. The closest example is possibly Japan and they are in the end of their cycle. They are seeing problems. They're constrained.

people in Japan are getting more upset at inflation they can't deal with. Wages are not rising in pay of inflation. Japan hasn't had inflation for 30 years. They didn't know it about it. Now it's happening and they have no way to deal with it. They can't stop printing. They can't stop. So I just want to,

that's why I talk about it so much. They're forced to print because they can't get people to buy their debt. No one will loan the money anymore. Nobody loans Japan money. It is insane debt to be. So they print their own money to buy their own debt to make it look like they're above board and working. But nobody's loaning the money, and it's deflating their currency. It's inflating their currency.

I'm sorry, they're making their currency more and more weak. Yeah. So people are, regular Japanese people are noticing that, like, foreigners coming in have a lot more to spend than they do, that their currency is getting weaker and foreigners are getting stronger and they're overflowed with tourism. They're falling behind. It's happening as we speak. Like, they have good societal structure in a way that we don't.

They're less likely to, you know, riot and have problems, but they're having economic problems. I have people that live in Japan, friends live in Japan, they're dealing with it. Their wages are not keeping up with other countries. And that's where we're headed. In a worse way, because we don't have the social stability of Japan. We have chaos in America. We're more likely to get really angry about it and elect a strong man

or something we're going to do some crazy policy. In my opinion, this is all, you know, where I'm standing. But that's, I think this is like the biggest issue of our day. It is so difficult to tackle and no one wants to discuss it. But I think it's dangerous. I think we've let it go for so long that we're now at the part of, where it matters. I put together some numbers about how we're spending money. Oh, I want to see this. Yeah. Yeah. So I, because I also, when hearing about debt stuff, it's often easy for me to glaze over or the numbers are so big that it's just, it just feels like it doesn't even mean anything anymore. So I feel like a really simple way to put it down. We owe $36 trillion in debt. The U.S. were $36 trillion in debt. We owe that much money to other people. And then every year, we are adding about two, I mean, it's technically more, but simply about $2 trillion. So if you pull this, yeah, cool.

So this is super simple. Every year, like in 2024, we spent $6,800, so $6.8 trillion, and we took in $4.9 trillion. About a $2 trillion difference. And so we had to borrow that, which made our debt go up. Okay, so I wanted to just look at like really simply. So we're spending about $6.8 trillion a year. These are the categories. This is based off of, there's a really, the source down there, a really great chart that shows income and outcome in all the different categories of the U.S. budget.

So if you're wondering, like, where are we spending all this money? Here it is. Social Security 1.5 trillion. Medicare, 870 billion. Transfers to states. This is all the money that the U.S., the federal government sends out to states for various programs. That includes Medicaid, which is like 600 billion or something. So most of that's just Medicaid. Again, health care for people. Defense, which is both military and things like veterans affairs, which is like 300 billion. So in terms of the military, it's like 900 billion, I believe, a year. But if you talk about the total amount that the Defense Department is spending. Trump's through budget is $1 trillion flat for military. He increased it by 100? Okay, cool. So it was like a close to 900 trillion, and I guess we're going up to one trillion. Got to up it.

Interest on debt is $8.78 billion. So if you're wondering like, why is the debt matter? This is what we spend every year. Like, it's, I think, well, like 15% or 10% like of our entire budget, of all the money that we could have to do, all the programs for anything around the world, and we're putting that much not on building or doing anything,

but just paying people back. It's stupid. And then everything else, like Department of Education, every other federal thing you can think of is in this everything else. So these are crazy, right? And you might look at this and be like, okay, if we need to basically, if we're going to stop losing money every year, we need to find $2 trillion. That's the super simple version. The easiest is cut down Social Security, right? But then I was looking into this. And my understanding, please correct me wrong, you guys or anything else. Social Security is not actually a big problem because if you go to our income, this is our income every year. We make a bunch of money out Social Security, payroll taxes, income tax is like the biggest thing which Trump admin wants to cut, which I don't know how that's going to work out. Corporate income tax, 500 billion. Everything else is 200-7. So this is

like this is where our income comes from. It's basically taxes, right? And so something that's interesting about Social Security is if you match these up, right, the program, the way it works is everybody who's currently working pays taxes every year for Social Security. We all pay six or 12 percent based on your employment. And so it's actually covering the vast majority of the social security expenditure. We're not actually losing that much on social security. It's like 200 billion. That's not a good. That's not good. But there's actually less to save with Social Security than it maybe looks like. Because again, on that expenditure page, it's like we're spending 1.5 trillion on Social Security, but that doesn't account for what we make from Social Security taxes. Whereas

the other categories of spending, we don't make money on Medicare, right? That's pure loss. So, as I was looking at this, and I'm curious to your guys' thoughts, I want to give a quick pitch on how, if you were the government, would you stop losing money every year? And you basically have these categories to go off. If you can stop spending so much on the military, I would be down for that, but that doesn't feel super tenable. Interest on the debt, that is not something you can really change unless we pay down the debt. That doesn't seem particularly feasible right now. You can try to hack apart the everything else category, which is what Doge is mostly doing. But then the two big ones are Medicare and Medicaid.

This is healthcare. It's healthcare for retired people and for low income or disabled people. Of the $6.8 trillion we spend in a given year, Medicare Medicaid's like a quarter of it. It's a huge, huge expenditure. And I believe it's one of the areas where by far we could save the most money. And you can make a lot of changes right now. So here's my thesis. And I'll keep it succinct. Medicare and Medicaid are the area, to me, that I feel like, of all of our money that we spend in a given year,

feels the easiest to save on. And there's things that we talked about last week where Medicare, is now able to, thanks to the Inflation Reduction Act, actually negotiate for its own prices with health insurance. Just to reiterate that for people are not aware, the giant Medicare, medical

insurance provider, the U.S. government wasn't able to talk to drug manufacturers and negotiate prices. They just had to like pay whatever was on the open market, which is insane. And so that did change with the Inflation Reduction Act that Joe Biden put out. Now Medicare is negotiating...

Not in 2026, I think. Yes. Medicare in in 2023, they negotiated prices. So this is for the first time Medicare can go to the drug companies and say, we're not paying that much. That is too much. We want less. Otherwise, you don't get to be a part of our system at all. You don't get, I mean, just Medicare is 60 million people in the U.S.?

Something crazy. Yeah, it's a huge percentage of the people. And it's also the amount of money that is spent on health insurance broadly. Old people are sick more. They need more help, right? Most of your medical costs come when you're really old. so Medicare is just wildly expensive. And so again, they've been paying these obscene drug prices.

And so they were able to negotiate new prices. And this is a little chart of what the prices look like now. So the green bar is what it cost in 2023, two years ago. The blue bar and the green one is what we're going to be paying starting in 2026. As you can see, some of the savings are 80%. We are going to be paying a fifth of what we were paying in the past. And I can list out some of the... And that is just with basic negotiation in a pretty much pharmaceutical controlled system.

Like, they still have so much incredible influence. Yes. And just the basic negotiation, like, these are still higher than drug costs in other countries. But, like, it just goes to show you how captured it's become. Can you scroll up to just see your all things? I agree with what you're saying. But I just want to say, like, you know, the broader story here is that Medicare, Medicaid, and defense are all situations where we pool our money and we give it to corporations

who set the prices. Yeah. We're giving it to Raytheon in defense. We're giving it to Pfizer in Medicare and Medicaid. And we are not getting efficient use of this. That's what I was going to say is I 100% agree with Doug that and but throwing defense in there because it's basically the same thing. Is you have to audit. That's fair. That's fair. Defense is being abused. in the same exact way, and it has to be audited, and it's something that has escaped audit. Criticism. Review.

It's so wild that Doge talked about this stuff and didn't touch Medicare negotiation, defense negotiation, which is like the area where the government is getting ripped off, completely... Which, again, look at this graph. I mean, if you're listening on... If you're listening, it is like,

we were paying the government, which is going into deficit and debt and putting all of us at risk because of it was paying, on average, over twice as much as they could if they were just able to actually negotiate. Do you know why they couldn't negotiate? Because in 2003, when part D of Medicare, basically when the government started these plans

where they would pay for Americans' retired people's pharmacy, like drug subscriptions, right? They said, okay, we're going to cover this. As part of the act that established this, the insurance and drug manufacturers lobbied with the politicians and said it would be a better, free market if the government doesn't negotiate prices, it should be left up to the private insurers. So a caveat here, this is actually less egregious than it looks because the way

Medicare works with drugs is that they actually have private insurance companies cover people and then the government pays them back. So the private insurance companies are the ones actually going out to the drug companies and negotiating and saying, hey, we want to lower price. Which they do have an incentive to lower that price still. There's still an effectiveness there. But I think the issue is that because these companies, when you break all these companies up as individual and negotiators, they don't have as much power as if the government, if the government was just negotiating on behalf of everyone.

Which is where the true negotiating power comes from when you're talking about whole country systems. That's why the prices are so much lower than even this on a lot of, like the percentage drop on a lot of drugs in other countries is so much further because they negotiate on behalf of everyone. Yeah. Right. specific numbers, because I looked into this, at least a few years ago, it's consolidated

recently. There were 11 private insurers that were offering healthcare coverage. So that was 11 different companies that had to go to every drug manufacturer and try to negotiate deals individually. Starting now, Medicare, not even with all of them. This is only with some of them, by the way, and this is going to save like $6 billion in 2026, just off this, and save patients $1.5 billion, by the way. So just this, it's like going from 11 people, individual companies had to go negotiate to Medicare, a single government entity saying, we're going to negotiate broadly

caused this much of a reduction. It is crazy. It's crazy. It's a mismatch. The private negotiators are not going to negotiate it for themselves. Like the person paying at the end of the day is the government. That's where the money eventually comes back

to them paying it. So if they're not negotiating, they're not, the people are not, you know, it's the principal agent problem where those people don't have their own money at risk. Yes. They, you know, they're, They're incentivized to try to negotiate prices down,

but it's not life or death with them, because it's not their money. It's all coming from our tax dollars. So there's one more thing I wanted to talk about here too. Right. Is that interest payment and how it grows, right? You're talking about how, in Greece's case, the only realistic option they have

is they need growth to outpace their debt. They just need to grow, their economy needs to grow enough that the ratio gets smaller and smaller over time. Because you're not realistically talking about of short-term plan of paying all that debt down. And the U.S. isn't really looking at that either. We want there to be enough economic growth to outpace our debt, which also involves us lowering our deficit, right? We want that deficit to come further and further down, and we don't want our debt

to grow. But the other side of this is we want our GDP to grow and outpace it. That is part of this. one thing that when you're talking about GDP growth is you spend government money on things in programs that emphasize the growth of your economy, right? You get a return. You can make an argument that a lot of these things, like Social Security, for example, Social Security payments go to people and they use them and spend them back into the economy, right? That is a part, it's part of what fuels the economy for older people that aren't able to work as much.

when you look at the interest, the interest has no impact on GDP. It doesn't help the country. It doesn't help anybody. It's more a thing to setting the money on fire. And because that problem is compounding and that interest is like building more and more and more, you have to account for this spending

that has no impact on that GDP at all. And it's taking up more and more of what you have to pay. We're taking your tax money, $878 billion of it and spending it on nothing, just burning. You know, it's, that's all. a lot of money that could have gotten a lot of things. And you can't even spend it now because I took it from you. Yeah. Yeah, I agree. If you, yeah, if you look at this chart, the thing I'm,

let's say, not hopeful, because I'm not about government spending, but at least I feel like there is a path, kind of, which is Medicare, Medicaid, and you guys are completely right, defense. I really hadn't been thinking. It feels like it's so politically untenable to be like, let's chop the military down, even though all people want that. Yeah. But you're right about the government contracting. And then what gives me hope is this, which is Medicare negotiating and it being so obscenely less expensive, like just criminal what Medicare has been paying, that hopefully this can start to be applied across multiple industries. It can be applied in the defense industry. It could be applied across Medicaid as well, across all of Medicare. And hopefully that brings things down.

And then even if you, like me, were hopeful that Doge would actually result in like, hey, let's make the government more efficient and bring stuff down. This, again, is the chart. Like, it's, Doge is doing nothing. It's saved $170 billion according to their website. That's the most generous interpretation. There's a lot of arguments that it's cost more money than that. If you look at the amount we need to make up, it's almost nothing. So Doge after five months, whatever it's been, has accomplished a tiny fraction.

And those are one-time savings. That's not happening constantly, right? So as much as I wish, like, I want there to be- No patience from Doug. Dude, that's what Elon's- grand plan to come out on top. I would love. I would love for them.

Look, hey, Elon all you want, but like, this is fucking fantastic that we are auditing sections of the government and being like, how do we become more efficient? The way you do it matters. Yeah. And they're doing it shitty and that sucks. So that's what I'm saying.

Like, in concept, this is like, holy shit, yes. We are heading towards a cliff. We need to save money. This should be, Do's should be one part of many different things to try to increase the economy, bring down spending. And it's not doing that. Dude, one of the first things Trump said was like,

I'm going to have Elon when he's done with this. stuff, go look at the military. We're going to get some of that more efficient and cut it down. And I was like, damn, I fucking agree. That happened. It didn't happen. And then we increased military spending by another $150 billion.

We're at a trillion now. Like, it's so frustrating to hear that. And then the action is the exact opposite. Because that is what we don't need right now is $150 billion more than the military. Like, we already spend so much. And it's so inefficient. You know, my dad works a Raytheon, bro. I don't know.

They, they just. They'll do these jet programs that just cost. They can just charge whatever the, it's the same thing as Medicare. Dude, it took me one conversation, one conversation with my girlfriend's friend's dad who works at one of these defense companies. We talked for maybe 20 minutes and I was like, you guys are robbing us. This is crazy. And he's like, he's like making jokes about it.

I couldn't believe it. It's baffling that those industries are like, you guys are single-handedly robbing the government. It's like the reason we run a deficit in many ways. They lobby the shit out of politicians to stop this from changing. And we're heading towards a fucking cliff that could ruin the country. And it's like, what the fuck? Why are we changing anything? It's insane.

On the topic of big companies using their money to ignore laws, we had, I wanted to talk about Apple, just full out ignoring. I can jam this in if we want. I'm all fired up about this. We have like 10 more minutes to go. I see. Yeah, yeah. I wanted to fit this in because I know this story.

has been going on for a while, but it sounded like there were updates of Apple basically outright ignoring this court order to allow apps in their market place to off-site their payments. This came through Fortnite and Epic, right? Fortnite wanted to send people to a web page

to purchase like V-bucks and things in the store so that Apple didn't get to take their cut. And this has been ongoing. Yeah, I mean, just super high level and you tuck it away, but just like super high level is like, if you buy a Fortnite skin through Fortnite on the app store, Apple gets 30%.

30% is a lot of money. It's a huge fucking cut. They didn't really earn it. They didn't make the game. They're just doing payments. So some companies, like Epic, will really piss at this, try to make a web store.

Sometimes when you're like on Spotify or you're on Patreon, you go to the web store to subscribe to Eliminates to it or whatever. And the reason is because those companies don't want to give Apple 30%. And Apple was doing a lot of shady, underhanded shit to stop you from doing this.

They were like preventing you from updating your app. If you had an offsite web store, they were like deprioritizing you. They were just finding ways to make it's not possible. And a judge finally said, this is fucking whack. You can't do that. This is your bylighting the spirit of the law. And that was the recent ruling. And I don't know what happened since then.

Maybe Doug, you want to give an update. And that is what I was going to talk about. Thank you, Aden. Fuck. Yeah. And there was new updates. You said new updates. I mean a little bit.

All right. So that's the summary for Apple's. I'm sorry. I'm sorry. Sorry. No, it's fine. Apple is, this is a, we've already talked about this as his old news. So, again, Apple's had this monopoly. I thought what was interesting, a few pieces that maybe you aren't aware of if you heard about this. First off, Fortnite's back. I got on my iPhone. Right now, it's back on iPhone. So that's new, right? Because that was not the case. That's like

yesterday. Oh, hasn't it been off the app store for like a few years? Yeah, years. So after five years, we're fucking back. Okay, Fortnite's right here. And look at how good that looks. Oh, I don't have the camera can zoom in on that. How about that? Oh, it's because it's vertical. right. Yeah. A little vertical Fortnite, baby.

Yeah. Oh, it says you are about to use cellular data. I don't know if that's visible. And this is what was gone for five years. Can you really? Thank God we had that. I'll just take a screenshot. Can I say it's kind of based they fought it for this long

because they lost so much money. By the way. Like they were printing money on Fortnite on. Oh, you mean Epic. Yeah. Epic lost so much money from what they could have done by making a deal. We were just talking about like USA, ruining debt. And so I'm going to try to take this to the same levels to make the emotional

impact of the same. Yeah, dude, Epic makes ungodly amounts money on Fortnite. And basically Tim Sweeney has the leader of Epic, the owner of the company who, as far as I can tell, I had a friend who worked there, really good guy who's very principled. He basically was like, we as a company are going to take the fact that we're influential with Fortnite and we have an ungodly amount of money because of Fortnite. And we are going to try to stop what Apple's doing, which is this anti-competitive shit where they don't allow anybody else to sell anything on their store. And it's interesting, this chart here, Apple Revenue, as you can maybe tell, I learned how to make charts this morning on Google Sheets. They're good.

So if you look at Apple's revenue, like 50% of it is selling iPhones. That's their main thing. 200 billion a year selling iPhones. It's crazy. And then they make 96 billion on top of that from services. So this is things like the App Store, but subscription services or whatever else. And you can see Mac, iPad, wearables. Those are all big.

But the big thing that drives Apple is the iPhone. That's half their money every year. And the services, which is money around like services that they sell, including the App Store. And the estimates we don't know are like 60% of that services is the App Store. So if you're Apple, something like, I don't know, 10, 15% of your overall company is based on the money you make. Again, not really doing anything, but just taking 30% of everybody else's money. It's just a tax that you're putting on. So everybody hates the tax except Apple.

They love it because it just gives them $50 billion or whatever it is. It's a money printer and they don't have to do anything. And then I am just heads up biased. I dislike Apple's a company. I dislike that they do things like this. Get it, Maiden. I dislike that they put these taxes on developers. You got the watch on the Mac and they don't do anything with that.

They're not investing this into like R&D. I'll be fair, Google is the same thing. There's a duopoly. Like Google Play Store, it's 30%. They do the same thing, but there's so much that Google. I can look at what Google does and be like they're funding deep mind, right? And making these incredible breakthroughs with like Alpha Fold.

Whereas they offer somebody service. It's like he forgot about the fucking Vision Prod, dude. Yeah, and then the only R&D, Apple hasn't done anything since Steve Jobs passed. It's been Vision Pro, which is a complete fucking flop. And AirPods, great. Did you know that if AirPods were broken out

into their own company, they'd be bigger than Nike? We should know. They'd be bigger than Nike. Yes, as you can see in the graph. That's under wearables and accessories. It's a huge bar, a big, beautiful bar. So it makes sense that Apple has basically had this monopoly on the system and said, look, it's our phones, we should do it where we want. They make an ungalded amount of money from it.

But it's a massive, massive tax on everybody else. 30%. I mean, for anybody who's run a business or, like, okay, grocery stores, what are their margins? It's like 1.5%. Right? They barely make any money and they just have to make enough volume to barely get by. Most companies do not have a 30% margin. And the idea that Apple charges this,

digital ones have higher margins, is fucking insane because they aren't doing anything other than processing transactions. I worked on mobile devices, doing the code at EA that manage this. I've seen the actual mechanics that go into managing this stuff. It's complex, it's not 30% complex.

It's like 3%. So I have a question. With the way this lawsuit has played out. Wait, wait, more energy. We've got to match the day. The way this layout of this has played out, this problem affects us. we have a Patreon page

and people may have noticed and we gave out a warning about this too if you try to subscribe to our Patreon on iOS you might wonder holy shit they're charging me a lot for this Patreon it's because Apple tax the fee onto in iOS purchases for Patreon

and we... Well it's more that Patreon Patreon is adding it on is adding it on because Patreon's like we can't afford 30% of our revenue for you doing literally nothing Apple Yeah, so Patreon is doing that, right? And we've encouraged people, by the way,

if you're listening, I want to subscribe to our Patreon at patreon.com slash lemonade stand, do it on desktop or Android, and make sure you don't pay Apple these fees. But what I was wondering, from the way this lawsuit played out, does that mean they don't get to do that anymore? Or does it mean within the Patreon app

they get to, they're allowed to link you into a browser to pay for it instead? So in 2020, 2021, I believe. No, 2020. Epic sues Apple, and they're like, we are going to try to stop this. Apple fights back. They win the lawsuit mostly. They still get to be the only app store. But the ruling was that they have to allow other apps to link to an external payment so that, for example, Fortnite could say, hey, go click a button. It's going to pull up the Fortnite browser. You can buy it there. You get to avoid Apple's fees. Because that would, that otherwise is anti-competitive, that they aren't allowing any competition at all. And then Apple has basically done, like I, like I, comical amount to make it impossible for anybody to do that in good faith. Not only did they make you put all of these warnings and shit that was like you can't make the link to go buy something on a different page. Very fun to look at or notable. I heard about that. Yeah, there's all these like warning signs that has to get approved. All this crazy stuff. Not only that, they then announced in 2024, we also Apple, even if for example, somebody clicks the link in Patreon in the app, goes to Patreon's website. Patreon manages the entire thing. Does all the work, all the tech, all the fees, and then comes back.

Apple charges them a 27% commission for the recommendation of having gone through the app store. That's like a honey scam. That's like honey, the browser app. It's baffling. It's almost like... It's truly like, I mean, I hesitate to say evil. It's unbelievable.

And so finally, with a lot of pushback from... This is what they've been doing for three or four years. They were supposed to allow developers to basically manage payments themselves through their apps. They're apps saying, hey, go do my thing over here. And that way they could dodge

this ridiculous fee. And they did the most, like, technically we're following it and we're completely fucking you over and it's no different. I'm not touching you. I'm not touching you. I just want to,

so recently, and this is a few weeks ago, I just want to read out the quote from the judge who followed up on this case. Apple willfully chose not to comply with this court's injunction. It did so with the express intent to create new,

anti-competitive barriers that would, by design and in effect, maintain a valued revenue stream, a revenue stream previously found to be anti-competitive, that they thought this court would tolerate such insubordination was a gross miscalculation. As always, the cover-up made it worse. For this court, there is no second bite at the apple. And then, look at that shit. It is so ordered. What a fucking giga-chat from Judge Yvonne Gonzalez Rogers. She shot Tim Cook in the face. God, dude, what a fucking Chad. And then this continued. So then the recent update, okay, this refresh, that you might not have seen is that they then were stalling, allowing Fortnite back on. So the judge a couple weeks ago was like, this shit needs to stop. Not only do you have to stop it right now, you're not allowed to have any tax. That 27% commission has to be zero now. You have to remove the restrictions on the links people could have in their apps. You can't do that shit anymore. She's basically being way more aggressive because they were so aggressively going against the spirit of the ruling. And she recommended them for a criminal proceeding because the CFO went and lied about how they came up with the 27%. And it turns out he was purging himself, perjuring himself.

And so they also, the past two weeks, even after that, have been stalling, putting Fortnite back onto the app store and having all these things. So then there needed to be yet another. It looks like the link to, oh yeah, here. So then the same judge had to issue another thing saying, you need to prove immediately and bring somebody to court to prove why you can't put Fortnite back on the app store immediately. And if this isn't filed by May 21st on Wednesday, it's going to escalate even more. So even after pissing off the judge, lying in court,

going through all this stuff, which is now they're potentially going to have to do a criminal proceeding because of the way they've been acting. They also have gotten another reprimand from the same judge for not putting up Fortnite. And all that resulted in finally yesterday, about 20 hours ago, Fortnite is back on the app store after five years.

Hey, system works. It just takes seven years. Two years. One of the things that I just wanted to quickly, if you go to, so Tim Sweeney's very passionate Twitter, he's obviously very biased in one direction on this. But what I think is great is that as he, you can go through his Twitter and he's showing all these examples of other companies who are now saying, because of this ruling, we are now able to add other features.

The Spotify people are saying they're now going to add features that weren't sold on the iOS before because it was not tenable for Spotify to offer this. they now can. And so all of these companies that have been absolutely shafted, if you think about like Uber and how expensive, I know Uber is not a likable company,

but it is extremely expensive to run a ride sharing service. Wait, was it adding the Apple fee to an Uber ride? No, they just had to pay Apple, this insane fee. Apple isn't doing shit. They aren't providing the maps.

They aren't providing the pay. It's nothing. I mean, again, technically they are. It should be like a 3% fee. But this has been unbelievably egregious and really hurt the people who make products. And if we're talking about the economy growing out of the debt,

getting it back to the high level stakes, like you have to have people making things and growing. And if Apple is just taking a 30% tax on everybody and hoarding it for no goddamn reason, I am so happy about this. And Google is also following suit. They're also having to do a similar thing. Yeah, I don't know like a full breakup

of their monopoly on the app stores, but in many ways is effectively that. Other ad developers can actually do payments themselves. So one more thing. You just say sign up for the Patreon on any platform. Well actually, no. Sign up on iOS,

click the link that takes you to the Patreon site and do it on the Patreon site because you will pay way less. One last interesting thing with this that I learned from you was that this is a rare moment where U.S. regulation is ahead of places like the EU.

Because EU famously, you know, switch the iPhone to USBC, like other changes to Apple that they have required. But with this, it's, this is a U.S. only change right now.

In Europe, this does not apply if you use these apps. Quick correction. That is exactly wrong. Oh, damn. Yeah, that's super wrong. Oh, I trusted you.

Wait, tell me, because I, digital, I forget the name of the Digital Rights Act. 2022, there was a act by the EU that basically enforced this and said companies on the app

store have to be able to link to other things. So this has been in the EU for like two years. Oh. Some change of this. this is not being done in the EU because Apple, in true Apple fashion, literally changed their TOS to say, now you can do this, but only if you're within the United States.

Yeah, so, so EU has had their own set of rules, but it has been looser. They have, I don't know exactly the restrictions, but the EU in 2022, basically force iOS to do this. So in Tim Sweeney, in his responses, he was like, this now, the process in the United States is now going to match what the EU is. They might be slightly different because technically they're going to have different, you know, this is an American injunction by an American judge, but they're now roughly on parody. Okay. Okay.

I mean, I did see all the things on Sweeney's channel. It felt like the end of Star Wars when the death star explodes and they go to every planet, everyone's shit. Dude, fucking, oh, this is so good. I just, it's unfathomable to just take money for it. I just crazy to me. So subscribe to us without giving Apple their cut. Join the Patreon.

And if you want to see more of this content, we're going to have a bonus Patreon episode coming up on Lemonade Stand. Patreon takes very, very little money. We get all of it, which we then get to put into... The national debt, which is solved today. We're going to dump it into the debt. We'll pay it off. Hey, next rate we'll take care of it.

The next Raytheon jet, we'll cover it. Yeah, we'll cover that one. All Patreon for the next year goes to a single F-37. There's like 10 nuts and bolts. Thanks guys for watching. Thanks, everybody. Doing it next week.