Pivot - Iran Market Disconnect, Vance v. Pope, and OpenAI Shades Microsoft and Anthropic

Episode Date: April 17, 2026

Kara and Scott unpack the latest on Iran, why markets keep rising despite escalating tensions, and what VP Vance is risking by challenging the Pope. Then, Trump renews his attacks on Fed Chair Jerome Powell, Amazon makes a  big satellite move, and OpenAI takes shots at Microsoft and Anthropic. Plus, a potential United–American merger, and millions of kids sign up for Trump-backed investment accounts. Watch this episode on the ⁠⁠Pivot YouTube channel⁠⁠.Follow us on Instagram and Threads at ⁠⁠@pivotpodcastofficial⁠⁠.Follow us on Bluesky at ⁠⁠@pivotpod.bsky.social⁠⁠Follow us on TikTok at ⁠⁠@pivotpodcast⁠⁠.Send us your questions by calling us at 855-51-PIVOT, or email [e-mail] Learn more about your ad choices. Visit podcastchoices.com/adchoices

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Developers have a word for that kind of reliability. Actually, five words. It's a great fucking database. Start building at MongoDB.com slash build. I used to be this key professor that everyone said nice things about. And then when I got big because of you, people started actually looking at my shit and saying, this makes no sense. Hi, everyone. This is Pivot from New York Magazine and the Vox Media Podcast Network. I'm Kara Swisher. And I'm Scott Galloway.

Where are you right now? Where are you? I'm back in New York. I get back last night. Oh, you are? Yeah. I love coming back here. I don't know if this is my happy place, but it's definitely my let's go to Shemargo and get fucked up, Lace. Okay, but let me ask a question. The Piera tear tax. What is, did you hear about this with Hockel and Mom Dani? Do I mean if you're banging a French dude, you got to wear condoms? What does that? What does that mean? It's for people who don't actually live in New York. They're taxing your real estate. That would be you.

You're going to get a piettaire tax. Well, I'm glad you've announced that publicly, such that they know how to penetrate my LLCs and, like, attempts to hide my tax dollars. They're already on to Ken Griffin. You're like, you're like easy churn for them. Me and Ken Griffin. I'm just saying, that's who they're noting has a pieterterre.

Pia de Tres. What the fuck is with that? People who don't live, in New York who have a second home and doesn't act don't actually live here have to pay a tax that's what's happening just so you know I'm glad to participate and support our navy in great parks it's an honor for me isn't that what rich people say is that they love paying their taxes at 12 percent tax rate yeah I don't know let's see how much it is high value probably is over five million it's okay that's a bummer yeah that's you oh fuck this a 10 million dollar apartment could face 50 to 200

$100K per year, extra taxed. Yeah. What? You know, it'll raise about $500 million for the city of New York to help bring good services to the good people of New York. I say, hopefully you didn't know this. I say let the homeless rain and let the subway go to shit. I can't afford this. Oh, my God.

Oh, my God. Well, you have to rethink things. Anyway, I'm just so glad to tell you about your tax news. I'm just paying you back for my picture on the upper left side. I was in such a good mood this morning. and you show up and highlight and basically put a bullseye on my forehead for the New York State Comptroller. There is not a bullseye. Oh my God, they know it. They know it. I rent a studio in Gowanus, just so everyone knows. I don't own a place here. It's not a bullseye, Scott. They know it. They know. You talk about where you live. Oh, my God. Forget. You're not blaming me for this Pietater. Scandal.

I save your fucking. I save your fucking. series, you cost me a quarter of a million dollars. Let's get to the news. There's so much going on besides Pia. Your new name is Piattaire. Pepe Le Pee. You are Pepe. You know what? You kind of are.

Anyway, let's do a rundown of the latest with Iran. President Trump says the war is very close to over again. As we taped this Iranian officials in Pakistan's military chief are set to meet in Tehran to discuss messages exchanged by Iran and the U.S. Meanwhile, Iran's military has threatened shipping in the Red Sea. if the U.S. continues its blockade of Iranian ports. What do you think? Let me just piss off everybody.

I think that the U.S. threatening to block, to fully block the state of hormones is the right move right now. Many people do. Because if freedom of navigation for the last 150 years has been a key component of the global economy. It's a generally accepted principle that the strait of Malacca, the straits of Singapore, if Indonesia, Malaysia and Singapore decide one day to exert their geopolitical, power and get tens of billions of dollars that they could block the strait. Egypt could block

the Suez Canal. And so if there isn't a multilateral force that keeps this thing open, it just sets a terrible precedent. Now, how we got here, I think a lot of people have very valid arguments around, well, we broke it, now we're asking the world to fix it. But I think it's actually a good strategy to say, okay, if you want the straits blocked, we're going to make them blocked for everyone, including all entry into Iranian ports, which I think is the right move. What is really unusual about all of this, and I know we're going to get to this, is that the markets are up, which is just it fully seems like the markets have totally dislocated. Go ahead. I'm sorry.

Yeah, the S&P is up 2.6% in the last five days. Just they are going up because they feel that there'll be some opening of the Hormuz, correct? I mean, or as Scott Besson call it, the straight of Vermuth. But go ahead. Two things happening. One, I've said this for a while. I think the NASDAQ and the Dow are the two most damaging metrics in the world because they give people a false sense of how, of the prosperity and well-being in the world. And the reality is America is energy independent. And so there's actually some stocks that are up 20 to 40 percent in the oil sector. So it's not a defense risk to us. There is, the markets seem to be saying that the war will at some point be resolved sooner rather than later and that the oil flow through Hormuz will begin again. You also have this unusual situation where in the last three major conflicts the U.S. was involved in, or three exogenous shocks, the Gulf War, the Iraq War, and COVID, what ended up happening was the markets were way down.

And initially, in March, at the outset of the war, the markets declined 10%. But in each instance, there's been a ripback. In the following year, the stocks are up. So people have been buying the dip, and basically what's happened now is people buy the dip sooner, and the markets recover based on a historical pattern of the market surging after. Sure, but it's still a mess there, mess created by Trump that was unnecessary, right, the way he's doing. Well, that's a political statement, and you can agree or not agree. I'm just talking about with the markets. The markets have totally disassociated here.

They have, and I think, you know, Stephanie Rule actually has a really good take on this this week where she was talking about why they're like this. and they just feel they're just trading. That's what she said, the ups and downs. They don't care about anything else. They just have watched the historical. But also, look at who, look who this is hurting. Gas is up, gas prices or, you know, Brent crude is up. You know, the European benchmarks up 32%.

The price of gasoline in America is up 36%. Brent oil futures are up 31%. But let's be honest, who does this hurt? It hurts the lower half of America. Oil prices don't really impact you or me, Kara. And the reality is 10% of the top decile of American citizens now are now responsible for 50% of consumer spending. They own 90% of the stocks.

Do they care the gases at six bucks? I mean, it's an interesting media headline. But the reality is the stock market is now a proxy for companies that are mostly invested in technology and some oil companies. You could argue some consumer companies will get heard because consumers will spend less. But wealthy people just aren't affected by this. Right, which is the point you made.

I'm going to interject one of the things, I interviewed Jose Andres this week at the semaphore column, and he was talking about fertilizer prices and how people, you know, people across the world eat hand to mouth. And he was noting that. He said, you and I, you know, it'll be irritating to pay four, five, six dollars at the gas station. And it will hurt us, but not in the way it hurts people around the world. And also fertilizer prices for farmers in the Midwest. and added to the tariffs with Canada, because the two places we get fertilizer from,

I believe the United States primarily imports fertilizer from Canada, and I think Russia. Anyway, we have an issue with everybody else, and so the stock market doesn't reflect people's lived experiences, right? So one of the things that House Democrats are doing, you told them to act, and I don't know if you think this is a thing to do, but they just filed six articles

of impeachment against Defense Secretary Pete Higgas. I think they're getting ready. as Rahm Emanuel has started to make some moves, high crimes and misdemeanors related to Iran. And by the way, Hegseth, I must note, he read a fake Bible quote from Pulpiction during the prayer service at the Pentagon on Wednesday. He's really quite, and at the same time,

there's supposedly operations being prepared for Cuba. They're moving to Cuba, even as the Trump administration continues to beef with the Pope, which is a whole other thing. And so I think despite the fact that, yes, The stock market is reflecting something else. You and I might not be as affected at other people. This is, it's beyond political.

It's now economic for most people, which I think gets missed in. You know, it doesn't get missed in all this, but it has a real impact. Including this beef with the Pope, let's listen to a clip. Now, J.D. Vance has entered the conversation. Newby Catholic J.D. Vance at Turning Point USA event this week where, of course, nobody showed up, which was kind of astonishing. Let's listen. But I think that it's important, in the same way that it's important for the Vice President of United States to be careful when I talk about matters of public policy, I think it's very, very important for the Pope to be careful when he talks about matters of theology.

Well, I'm sorry, the Pope shouldn't talk about matters of theology. Isn't that exactly who should be discussing it? He has to be careful. He should be careful, even though he's a very well-regarded theologian. But J.D. Vance has some words for him. I think he's torpedoing. his 2020 chances by picking a fight. He's decided still that he needs to have such to be such an accolac. This is a politically stupid move for him because evangelicals are actually swing voters. They were sort of a toss-up with Biden, and then they went hard for Trump. If he doesn't get evangelicals, he's not going to be the nominee. And he's clearly decided that it makes more sense.

I mean, I don't get this at all, because if he were to come out and say those comments, While I respect what Trump said, I feel like the Pope's comments were ill-timed. I still have an issue and I will not be critical. If he came out slightly against Trump, Trump might be furious at him. Trump's not going to dump his VP at this point. And J.D. Vance needs evangelicals. I mean, this was just a really stupid thing. And also, just because I think it's important to be as offensive as possible

and convince people that I am not, in fact, running for president, You know how a little boy saved the priest's life. Oh, no, no, no, we're not doing, no, we're not doing, we're not. Okay, never mind, I'm sorry. I won't do it. I respect you. I got a picture of you behind me. Never mind.

Let's move on. He found a lump on his scrotum. He found a lump on his scrotum. Oh, no, no. Cop pulls over two priests and says, we're looking for two child molesters, and the priests look at each other and then look to the cop and say, we'll do it. Oh, my God. It's terrible.

Okay. We're not insulting the Catholic Church right now because Trump is doing so. I think the whole thing is insane. You know, I know it's a joke about Pete Hagseth, quoting from Pulp Fiction. He probably did an AI search and thought it was that, right? That's my guess. That's probably what happened in one of his dumb minions added it in. But it's a fake Bible, but these people are so performatively religious is my issue.

Like, they don't even read the Bible. They just quote from Pulp Fiction because they don't know the difference. And if you were actually someone who's really religious, you do know the difference. And with the vice president, just literally, let me just take one more point. The Pope is an American citizen. He should be able to say what he wants, by the way. He remains in America, I assume he remains an American citizen, despite being a Pope. But he doesn't lose those First Amendment rights.

But he's talking about peace. He's talking about tyrants. He's talking about everything Jesus talked about. He's very good. And solidifying his power. What do you get when 500 Jewish mothers convert to Catholicism, Kara? You get critical mass. Critical mass.

I think that's pretty good. I think that's pretty good. Anyway, we're going to move on. This is really disastrous. This fight with the Pope. The Pope is going to win kids. No, don't go up against El Papa. Especially this Papa, he's very good.

He's very good. This is a good Papa. Like, oh, man, I even want to go in the church. That's how a good Papa it is. I'm like, I'm going back. Like, I'm going back in. You're going to go to one of those crazy Unitarian churches with some lady with blue hair, baptizing support or rescue dogs. You'll end up in one of those kind of churches. No, no, I won't. I don't like those kind of churches. Or go to Glide next time in San Francisco. That's awesome. I love Glide. It's a wonderful church. It's a wonderful church. I don't like Unitarian churches. My ex-wife took me to one we were married. And I was like, do they stand for anything? Like, for some reason, the Catholic and me got going. They're too politically correct for you. No, they were like, it was like, it was like every, but everything.

They believed everything. And I was, and I, listen, I have a lot of respect for all religions, but I got, I had to leave. There's your land acknowledgement. I don't. I believe some religions are worse than others. Let me just say that. Oh, they're not worse. They're lovely people.

I just want to, I just, I got interrupted by my poorly, poorly time jokes. I just want to go back to the notion of trying to do an impeachment or begin impeachment proceedings of Hexas. I think that's stupid. I don't think you, I think if we've learned, or one thing we should have learned as Democrats, is that unless you have the votes lined up, you don't do it. It comes across, I just don't think America needs another impeachment. But I thought you said for them to signal what they're going to do. Isn't that kind of signaling what they're going to do?

No, in my view, this is what they do. An impeachment nostalgia tour, the Democrats don't need again. At this point, it wouldn't work. I'm all for impeaching the president at this point and the Secretary of Defense. You don't do it until you know the votes are locked. You announce it and then start the vote the next day. Otherwise, it's just performative and pisses off the other side and is a waste of time. This is what you do.

You announce legitimate legal action and coordination with a state AG to go after certain individuals who have committed actual crimes. And there's a lot of them in this administration. This is performative. It's political. And we're going to again look stupid. Okay. Anyway, I'm going to move on because the chaos follows Trump where he goes. he's back to his Jerome Powell fight.

He's like an old man who forgot he was fighting with someone and then remembered. He said if he doesn't step down next money, he's going to fire him, like even though he has more time on the board and also says the DOJ probe of Powell and the Fed should continue. Powell's Fed chair term officially ends on May 15th. His term as Fed governor is up in 2028. Usually they leave when they finish their chair, but he doesn't have to. And he plans to stay on his acting chair until his success. So Kevin Warsh is confirmed. Powell says that's what the law calls for.

Warsh's confirmation area is scheduled for next week. But Senator Tom Tillis, who I interviewed, as said, confirmed again. He won't confirm him until the DOJ probe is resolved. All this from the prosecutors from the U.S. Attorney Janine Piro's office showed up at the Fed this week, trying to get a tour of the buildings, renovations, got turned away. She's trying hard to become Attorney General, FYI. He can't, if he fires Trump, Powell, he's in big trouble. He's going to taco this one, right?

Presumably. He's back to it, though. It's three people in a room with Claude and ChatGPT, and every time the temperature and association with Epstein gets a bunch between the link between Trump and Epstein and its presence in the media gets above a certain temperature, they say, throw something out and distract everybody. And this is just another one because I don't even think he legally has

the right to remove Powell from the Board of Governors. So his term doesn't end until January 2028. So this is just, again, I believe he knows, and his people have said, I mean, there's two things that are going on. Either Grandpa just says shit as he's thinking it, and maybe that's true. Or if you give him more credit than that, it's another attempt to distract from Epstein. I don't want to say I feel bad for Kevin Warsh, but his entire hearing is going to be about Jerome Powell, not about Kevin Warsh.

And what I've said before is it as long as Powell is on the board of governors, he's the de facto chair because anything he says, 11 of the 12 governors, they're going to nod their heads. The chair. Which is why Trump wants him gone. That's exactly right. But he does not have the power to do this. And you are going to have several Republican senators find their testicles and come out in favor of Chairman Powell remaining on the board of governors.

It's, it, but I think Trump, I think Trump knows that and just today said, I need something to keep Epstein out of the news. I'll go after Powell again today. Or the war or, yeah, my favorite is they're going to start talking about Epstein to distract from Iran. Yeah, I know. Yeah, that was, that was, because that's what that's what that that was the Melania faint, I guess. We'll see what happens. They're not going to fire power. They're not just not. Okay, Scott, let's go on a quick break. And when we come back, Amazon makes a big acquisition. position. Support for this show comes from Quince. If you're participating in a time-warnered tradition of cleaning out your closet this spring, you might want to consider replacing some of those old clothes with high-quality pieces from Quince. Quince makes stylish everyday clothing using premium materials like 100% European linen, organic cotton, and super soft denim with styles starting around $50. Their spring pieces are lightweight, breathable, and effortless,

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Scott, we're back. Amazon is acquiring a satellite operator Global Star and a deal worth around $11.5 billion as it tries to catch up to SpaceX Starlink. Under the agreement, Amazon gets Global Star's existing satellites and infrastructure, which will operate alongside Amazon's own network now called Leo, after the Pope, I guess. Amazon says the deal will enable it to build direct-to-device satellite system with a rollout expected in 2028. FCC chairman Brandon Carr says his agency is very open-minded to the deal. and the FCC is taking all gas, no breaks approach to expanding the U.S. space economy.

He kind of has to. He just kind of has to. What do you talk about this? Because obviously, Amazon isn't going away. And they're trying to solidify this network for themselves to be at least the number two player here. My big stock pick for 2025 was alphabet. We got that one right. My big tech stock pick for 26 is Amazon.

This is what I think Amazon is going to do. They are going to build a viable competitor to Starlink using Kuiper as a platform. And this is another step in that. It's called Leo now. It's called Leo. I'm sorry, Project Leo. They bought, basically they've bought 24 satellites here. And it's never been profitable.

But Amazon closed up 3%. And this is what I think Amazon strategy is. Amazon's going to launch a phone. And then they're going to offer Amazon Prime Plus, which will offer you a phone. and lightning fast connectivity into your home. They're going after AT&T, Verizon and Comcast, and basically gonna offer you connectivity with Amazon Prime. And they need the satellites to do this.

So why would they buy a non-profitable satellite company? Again, see above 24 satellites. They get spectrum, they get radio waves, the wireless signals, including Wi-Fi travel on. The government owns these and issues specific licenses for them, but Spectrum is auctioned off by the FCC and extremely expensive. So they get that.

They could do for B to C, again, Amazon price, they could sell Wi-Fi to prime subscribers. B-to-B, they could sell private wireless networks to serve its warehouses, delivery hubs, robots, drones. Robots and drones need this connectivity to communicate wirelessly. Constantly, and it's much easier if it's cost-efficient if Amazon has its own network.

Yeah, so it's a strong number two. It's to create a strong number two. This is essentially what Amazon is. It's the strongest infrastructure company in the world. It's an extension of their investment in the logistics network. And right now, Project Leo has 240 operational satellites. It plans to ramp up its network by deploying 3,200 in Earth's low orbit by 2029. Starlink has over 10,000.

This is definitely catch-up. But Amazon has 115 million homes to offer this service to overnight. Right, the relationship with consumers, right? So you have to go out and buy Starlink, and people do love it. And I have to say, you know, oddly enough, Jose Andres, who has had a huge beef with Musk over USAID saying he's killing, essentially saying he's killing people. He said we used to turn like is critical to our world central kitchen operations. And I think he would like an alternative. But he definitely said, it's really a shame.

I wish that Elon was around and not this other one, which is, you know, hugely damaging to their efforts across the world, feeding people. But between that fertilizer and that, like the cuts at USAID, they're facing, you know, a huge uphill battle against hunger across the world. But one of the things that's happening here is you get an all, this is what happened with Tesla. This is what happened. There's going to be number two. Now, will it have an impact on the SpaceX IPO? I doubt it. I think it's going to be like, it's going to run.

Oddly enough, interestingly enough, Google is a big owner of it, of the SpaceX IPO. They're going to make like many commas. of money from this deal. So that should, that would, that, that'll be an interesting thing because many years ago, Yahoo owned a big piece of Google. I don't know if you remember in the beginning. And that's what saved them for a while, like having that investment in, in Google that they made. And now in this case, Google's going to make a lot of money from these basics.

But I don't think the SpaceX, I feel, will be damaged anyway, correct? From your perspective. No, it's arguably one of the strongest rents in the world right now. and people are excited about it. It'll go out wildly overpriced. I think it'll get a slight bump. It'll be the biggest IPO of 26. The best IPO of 26 will be Anthropic,

which will get out ahead of Open AI, because it has more momentum. But it's going to be, again, if you look at SpaceX, I think 18 billion in revenue, six billion in profits, so when it's going to, it's going out at 100 times revenue, It's growing 24% a year. When Google went public, it was growing 240% a year

and trading it 10 times revenues. So, SpaceX, incredible company, the most overvalued IPO in history, the answer is yes. This is just insane the valuation they're talking about. Yes, yeah. And I think it's great that there's more satellite efforts like this.

There has to be at least two or three. I mean, they're not going to be more than that, by the way, because the costs are so huge, but it's good for having run for their money. Speaking of Open AI and Anthropic, open AI is distancing itself from Microsoft and cozing up to Amazon, which is interesting. In a memo sent to staff,

OpenAIS revenue chief, Denise Dresser, said that Microsoft Partnership has limited the company's ability to meet enterprises where they are. No, no shit. On the other hand, Dressor said the company's Amazon deal has generated, frankly, staggering demand.

Dresser also used the memo to go after Anthropic, accusing the arrival of building its strategy on, quote, fear, restriction and the idea that a small group of elite should control AI. Obviously, they're throwing, they're trying to hurt Anthropic in the race to an IPO. They're throwing Microsoft under the bus. And interestingly, speaking of Anthropic news, the company has recently received multiple offers from VCs to invest at valuation as high as $800 billion. And Anthropic has briefed the Trump administration about its new mythos model, which is not being released to the public,

as we talked about last week, due to its alleged cybersecurity capability. These. Dezos owned Washington Post said the efforts by the Pentagon to the sort, anthropic or stupid, which was interesting this week. So they're fighting it out in court. I suspect the Trump administration is going to start dropping that soon enough. But talk a little bit about this Open AI memo, which was obviously leaked in order to get it out there.

And this idea of breaking from Microsoft sideline up to Amazon and attempting. to stain Anthropic in some way, which I think is stupid in my estimation. Anthropic has more momentum than any company in the world right now. It's gone, I mean, it's gone at the end of 2025, which wasn't that long ago. Its ARR was $9 billion. It's now $30 billion. It's more than tripled its annual recurring revenue in four months. And by the way, Open AIs is $25 billion.

So the little engine that was kind of an afterthought to Open AI, just 12. 18 months ago is now a bigger business than Open AI. And this is the first time that Anthropic has led on revenue, and it's growing faster. It's, and not like that, it's a better business because that growth is almost exclusively enterprise-driven, which is a better business. So what is OpenA. doing here by release,

they release the memo. Let's not pretend this is what they were doing. What's the messaging? This has become Coke versus Pepsi. And yeah, I think it feels desperate. I don't, I know. I do. They're trying to, they're trying to weaponize the governing against them.

They're trying to ship post them. These guys hate each other. It's, it's the Hatfields versus the McCoys. And Anthropic has 1,000 customers paying over $1 million a year. That's up from just 500 in February. The number of customers spending over a million dollars a year has doubled in the last. So they don't seem to care about the Pentagon thing at all. You had thought they might, but it looks like they don't.

Looks like they don't. The numbers here, let me give you some more data. 80% of Anthropics revenues come from business clients, who are quite frankly just more reliable and less margin sensitive than consumers, versus 40% at Open AI. 70% of every incremental dollar spent on AI coming from the enterprise is going to Anthropic. They raised $30 billion in their Series G at a $380 billion valuation, which is ridiculously low compared to the $850 billion valuation that Open AI did,

guaranteeing a 17% return, which could crush previous investors if they don't, if they have to go out lower than that, they also said, I mean, both companies are exploring an IPO this year. An Anthropic projects positive free cash flow by 2027. Open AI is said they're going to break even in 2030. But the bottom line is, Dario Amodi is just showing himself to be a much more competent CEO than Sam Alman. Right. Let me ask you a question. This focus on consumer. Here's what I see. Open Ag definitely focused on consumer and being like Kleenex or Google, right? That was what they were going for. The one that everyone thinks of Chad GPT is Kleenex, right? Or Google or whatever, the representative of everything. So they relied on the consumers. Then they have a really good, they start, Sam Altman starts to get a very bad consumer reputation. So he, like, up and up to and including people attacking his home,

right, which is heinous, they have relied on consumer relationships, which are very easy to break, right? Suddenly you become the bad guy. And I think that, that's one of things. But bear hugging Amazon and pushing away Microsoft, what is that, if you're in the room, what do you think the strategy is? The honest truth is, I don't know. My guess is there's some ego involved here and some dynamics behind the scenes that I just don't understand. But let me be clear. It's not easy to build a consumer brand. It can be very powerful. I'm not suggesting, I'm biased because all my businesses have always been B2B. And the one business I did B2C, Red Envelope, which is so much fucking harder as I found than building a B2B business.

Now, what I think the dynamic here is the following. The reason why Anthropic is going to be worth more and get to the IPO starting line faster than OpenAI as an enterprise. as a dominant business as opposed to a consumer business of open AI, it's not necessary that one is much better than the other, but here's the difference in terms of competitive dynamics. You can get, as a consumer, a really outstanding LLM and AI for free. If you're a company, if you're Clorox looking for a $3 million enterprise-wide LLM AI offering, there's no free alternative.

So in sum, the substitutes, on the consumer level are just much greater than the substitutes at an enterprise level, which says to me, whoever dominates enterprise has just a much better business. Also, with just a duopoly, if one is perceived as better, which right now Anthropica is perceived as better in the enterprise, enterprises are much less consumer sensitive,

because if they're going to implement technical debt, they don't care if it's 30% more expensive. Is it a mistake to then say, We didn't get in the enterprise fast down due to Microsoft, which may in fact be the case, and now we're gonna have Amazon. That makes no fucking sense. Right.

Why do it? Why are they doing it? You're gonna piss off one of the most important, measured, thoughtful people in tech, such in Adela? Who backed you? That just makes no sense. Who backed you when you were in trouble? Yeah, and it shows that you're not getting along with you.

You have these fights behind the scenes. You don't say that publicly. You don't get into a war with Microsoft. Well, they didn't. It was a memo that got out, but they leaked the memo. I mean, this is my feeling. But one of the things they have to do is they have a problem with their image. Because they're the face of AI, they're the face of AI, right?

Well, Dario looks like a hero from a marketing point of view at the very least. And so that's, I think, the real problem is Sam Altman represents AI, which everybody is hating on. Like young people, all the polls, everybody has a problem with it. And when the problem shows, you look at someone like Sam Altman and not Dario, you know, is not getting the kind of hatred that Altman is getting now, which I think is a problem. But why hug Amazon too? Because Amazon is executing against infrastructure like no one's business. And if you want to, I mean, arguably, Amazon from an enterprise level, is the most discerning

consumer in the world. And Amazon is the best infrastructure company in the world. But I think there's some ego here. I think someone got pissed off at someone. But you don't get into a public tiff with Microsoft. By the way, just in terms of stocks, Microsoft does a multiple of free cash flow is cheaper than it's ever been.

I think Microsoft's a really good buy right now. But, look, The Anthropic has so much momentum right now, and Open AI does not. Do you get this? Kalshi is saying the odds of Sam Malmant being replaced as CEO are up to 27%. I mean, for the first time, Sam Altman being replaced by the end of the year,

is a real possibility because Open AI, public tiffs with Microsoft, who was supposed to be your partner in this, throwing up, totally shitting the bed in the enterprise market, all this negative PR and press. I mean, and there's just no getting around it. Anthropic is worth more than Open AI right now.

And so I think Sam, I think they were smart to be focused. They're gonna do away with that ridiculous fucking nonsense from I.O. That was the stupidest acquisition of 24 or whatever it was. That's going to be a $6 billion ride off. They're smart to stay focused. But this is a tale of two cities. And one city is skyrocketing, and that's anthropic.

And the other is burning up on reentry. And that's open AI. You know, I think about it is. But the posturing is important, right? So Altman is fighting with Musk on that case, which is going to be full. It's going to go in a trial. looks like, this case. So that's going to bring unnecessary, no matter what, Elon fights,

you know, with a lot of swords. So it doesn't, he'll land some blows even if he's, and make them look bad. He will, even if he looks, he doesn't care because he's like the villain. So it's fine if he makes other people look like a villain. I mean, from a public perspective, they're also, you know, it's not just Altman. It's like someone like Chris Lahane, who I find very aggressive, right? And this is a very aggressive group of people. that sounds like they're not getting along in turn. You sort of feel rumbles of that. You know, the mistakes of not embracing enterprise

and going full scale into popularity, I think, is always, if you don't make that transition, as you said, it's really difficult. And quietly, this other group has done this. Now, I agree, they shouldn't be fighting with Microsoft, but they made the mistake, and now they're blaming their partner for that, right? The ability to meet Enterprise is where they are, They're actually- They look like they're flailing.

They're competing with Microsoft. They are competitors in that space. So anyway. But what's to be gained? What's to be gained by shitposting Microsoft in public? I don't know. What do they get? Just to say, we're serious about the-

We're going to really compete in the enterprise. Now we're serious. I don't know. I don't know. I just, I don't understand this memo whatsoever. But what enterprise is going to hire Open AI because they've been critical of Microsoft? I don't, I absolutely don't get it.

These people have egos. Such a Nadella doesn't need Sam. I mean, Microsoft could write off its investment in Open AI. Quite frankly, the market has already done that. The market has taken Microsoft stock down, I don't know, 20 or 25% in the last six months. The trouble in Mudville has already been perceived by the market with respect to Microsoft's playing in traffic with Open AI,

and that their investment in Open AI may not end up being, you know, the kicker in the afterburn, everyone thought, it was. Amazon got in at better rates, essentially, but go ahead. And a guy like Sachin Adela doesn't scare easily. I don't, I absolutely don't understand who approved this public spat on the, and it says to me that Open AI does not have a board that would say, oh yeah, that's a good idea. Let's get in a war with Microsoft.

There's ego here. Someone got pissed off at something. Yeah. Going after anthropic as being fear restriction idea this small is just sort of so backward-looking, When you start attacking the number two, there's something going on, especially, I think they were trying to get reporters interested in this run rate and, you know, inflation of revenues, which, by the way, no one really cares about with these companies at this point. They want to know who the leader's going to be.

Anyway, I mean, they should care, but they don't. There's a general crucible rule, fundamental truth in branding and marketing, is that when you're the market leader or you want to be perceived as the market leader, you want to be perceived as the market leader, which I think Open AI would say, we are the leader and we want to be perceived as the market leader. You never reference the competition. Right. You don't.

You just never, a visa was a client of mine back in my brand strategy days at profit. And I said, why wouldn't you talk about this versus MasterCard? And he goes, we're the market leader. We never reference the competition. When you reference the competition, you're immediately saying they're a competitor. And when you're the market leader, what you want to say is we have no. Coke never referenced Pepsi. We never did a taste test.

Like, we don't even, as far as we're concerned, Pepsi doesn't exist because we're fucking Coca-Cola. I've done that. I used to do when they were talking about competitors. I'm like, who? I'd be do things like, like, I'm sorry, I didn't see it. Like I would, stop for this. Yeah, I don't.

The best, I don't do that. I do. Well, I'm always like, Scott? I don't know, Scott. Who's that? Who's that? What? I think someone said he has a picture of me behind him on his podcast.

The, the personal learning here is a, learning here is the following, or what I finally come to peace with. When people shitpost you or criticize you online, the best revenge, hands down, indifference. Just indifference. You've gotten good on that. Don't mention it. Remember used to get mad at certain people attacking you. You get all. Well, I wasn't used to it. I used to be this Q professor that everyone said nice things about. And then when I got big because of you, people started actually looking at my shit and saying, this makes no sense. And I would get upset. Anyway, I'm fine now. Yeah. I'm fine now. No.

You're not discovered edibles. No, it's good. Anyway, you've gotten much better about that, I have to say. Getting off of Twitter, which you did first, I will acknowledge. I'm sorry for making that mistake last week. Anyway, another interesting story. We're going to go on a quick break. When we come back, we'll talk about a potential United American Airlines mergers.

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We rarely agree. But we almost never disagree. And we're always learning. That's true. You can subscribe to the Curiosity Shop on YouTube or follow in your favorite podcast app to automatically receive new episodes. every Thursday. Scott, we're back with more headlines. The CEO of United Airlines reportedly pitched a merger with American Airlines directly to Donald Trump, of course. The two companies

combined would account for about 40 percent of the U.S. domestic flying capacity, industry experts in law, makes sure he's already pushing back, flagging major antitrust concerns. I mean, even I know that. As one analyst puts that the Justice Department doesn't object to that. What would they object to? Trump is staying quiet for now with the press secretary of Cohn-Levitt saying he has no opinion on a potential merger. I mean, I don't mind this guy trying it, but why not? It's the last days of the Nero's empire here, so why not? But this seems like something that would be dead on arrival.

I just don't see it. I mean, I don't know. What do you think? Yeah, but you just summarized it perfectly, and that is the last days of Nero, and that is you're going to see in the next two years, you're going to see so many mergers proposed because everyone's going to go, there's no fucking way. an FTC or a DOJ that is not in a deep coma would allow this.

So if we're, you know, if we're, what are the, you know, two most dominant play, if you're just going to see mergers like crazy because they're going to go, this is our last chance because this absolutely makes no sense from a concentration of monopoly standpoint. This should not be allowed to happen. It would create the largest airline on earth, 30 to 40 percent of U.S. domestic capacity. And I don't know if anyone's noticed, airline ticket. are skyrocketed.

I know I have. I just bought some. I was looking at a one-way from Miami to London business class, and it was 11 grand. I know. It's crazy. There's. Kirby's argument to the administration, a combined airline would be a stronger competitor internationally.

Okay, yeah. He noted two-thirds of long-haul seats from two from US from foreign carriers, but 60% of passengers are American, framing it as a trade deficit issue. And also American, I love airlines, I love aviation. Delta does the best job domestically. Jet Blues, Mint is the best product. But American has been, America has the worst product. They're the weakest of the big three. 111 million in net income last year on 54 billion in sales, basically break even. And it carries 25 billion in long-term debt more than its rivals.

On the other hand, United, which is a better run company, did 3.4 billion on 59 billion. And American airline stock jumped nearly 10% on the news. So what does that say that it could happen? This can't happen. This won't happen. No way. Well, the market thinks it might because, again, see above the guy, it's just fucking ridiculous that CEOs go kiss the ass of the president

to try and get a merger through. He should have nothing to do with this. But the antitrust problems here are striking. There are 289 routes with the two carriers overlap. And combining them would leave only one or two airlines serving that route. see above, increase in prices. They will fuck consumers so hard. Some of the roots that overlap are Chicago, Los Angeles, New York, Newark, Phoenix, Charlotte,

could require divesting entire hub operations in some cities. And the DOJ previously blocked the JetBlue Spirit deal, which was a fraction of this size. So this is exactly the kind of deal that shouldn't even be considered if there was a DOJ or an FTC that was independent and looked at consumer prices. And these consumer mergers and the lack of regulation does two things. It transfers capital from labor and from consumers to shareholders, full stop. And it's been a one-way flow of capital and power for the last 30 years. And the DOJ and FTC have almost no reviews anymore.

I mean, it's like if you want to save money, get rid of the DOJ and the FTC. What the fuck are they doing now? They can't. They absolutely cannot do this. I mean, you know, it's interesting because on Monday, you're seeing significant pushback. We'll talk about this more on two things I want to talk about on Monday. The significant pushback to Paramount now. A lot of Hollywood is now, like, got the pitchforks out, essentially.

I don't know if they can do anything about it at this point. But you see them, like, really organizing at Cinecom, all these places. There's all this pushback. And again, David Allison wouldn't show up for a hearing in Congress about this, just for personal reasons. but there's just a lot of pushback there. And you sort of see it beginning to coalesce these ideas of, no, I don't think so, which is interesting.

You'll see if this happens. Like, I feel like people are quite in the mood to stop these things now. And that's going to be, they're going to overreach on the other side, probably. But it feels like this is like, I can't even believe this guy did this. Like, I just think, well, okay. And Trump has no political. capital to take this on at this point. No way. It's just never happening. I don't see it. I don't see how we do. I need to correct the record. The DOJ and the FTC do serve a purpose. They did,

they did decide that Live Nation was a monopoly, which was the right, which was the right decision. Yeah. We'll see. We'll see where it's going. There's a lot of pushback on all these things, but you're right. They're going to keep trying to do so as things come forward. And then we'll get to a normal level again, hopefully. One thing that's interesting, about five million kids have signed up for Trump accounts, a $1.2 million eligible for $1,000 treasury seed deposits. The accounts were created through Trump's big, beautiful bill, and is set to officially launch July 4th.

The Bank of New York Mellon will manage the accounts and Robin Hood will build Trump accounts app. What do you think about Robinhood known for getting people into risky trades involved in this? Obviously, another suck up to Trump in some fashion. But I have several friends who are just doing it. It's like $1,000 free dollars. Like, why not?

Like this, why not? It seems like let's take the money and use it to save for college or whatever you want to save for for kids. Any thoughts on this? I love this concept. I remember meeting with a guy named Alex von Furstenberg a couple years ago and he was pitching me on the idea of baby bonds and he was very passionate about it and he's been very involved in it. I love the concept of at the very outset giving, you know, for every infant born, giving them some money and letting compound, you know, the most powerful force in the I would have gone much deeper than this. For $40 billion a year, you could give $7,000 to every baby,

and then I would totally infantilize them and not let them touch it until they're 65. You spend $40 billion a year, and then in 20 or 30 years, you announce in another 20 or 30 years, we're no longer going to need Social Security because everyone's going to have a million bucks at 65. Interest rates dive, and it pays for itself.

But our Congress doesn't want to think past her than they're fucking two-inch dicks. So... Is there danger here of riskiness for people's like... people's, like, I mean, this is free money. That's what I can, you know, someone, it's cheapest, just said, oh, I took a Trump account. I'm like, are you kidding? Grab it. Like, absolutely take a Trump account. Oh, why wouldn't you? Yeah, if you're eligible. Just to give you a sense of compound interest, you know, my kid's going to college next year.

When he was born in 2000 and, when was my kid born, 2000, 2007, I put $10,000, and I think it's called a $529 New York account. I did too. And I'm like, I'm like, I. I'm worried about college. I was a clinical professor making 160 grand a year living in faculty housing. And so I thought, OK, I'll scrape together 10 grand. And I didn't do it again. I was stupid.

I didn't do it again. I just looked it up online because I'm like, oh, what about that 529 I did? Now, granted, the markets have ripped. Do you know what that $10,000 is worth right now? A couple hundred thousand dollars? No, 85. But still, in 18 years, it went from 10 to 85.

Oh, I put more in. I did them for both boys. Mm-hmm. I paid for all of course. college with Louis and Alex. And people have controversies around 5-21s. You could have done better in the market. But I just put it away and forgot about it. And I kept, I added the maximum amount to it at the time. Yeah, but it's tax. It's tax-free. You can take it out. That's tax-free. I just was like, I don't even want to find. I know I could probably do better in the market, but I don't care.

I had the money. I don't think you could have because because the difference just to explain it, if you invested $10,000 and I had $85 in the market, say out $100, I'd have to pay, I'd have to pay capital gains on it. Whereas if you apply it towards tuition or school supplies, you get to, you don't have to pay taxes on the gains. My point is the idea of giving kids every baby born a retirement account, I wouldn't let them have access to 18 or 25. The problem is, and the thing that's going to bankrupt our nation, as we continue to send more and more old people who vote old people more, vote themselves more money, we have to reduce entitlements for old people. And this is the way So they're not entitlements, they're investments.

I mean, I think the danger, obviously, is if we remove it completely, is people are, you know, subject to whatever the business is the market. And that's always been the worry, right? That's why it's called Social Security. There has never been, okay, but there has never, you could buy any five stocks since the beginning, the beginning of the markets. You could buy any five stocks in the S&P, and if you hold on to them for 10 years, you've never lost money. because of demographics and innovation, the long-term trajectory of the market. Now, there's been decades where it's gone flat,

but over the long term, there's nothing like the up and to the right of the markets. And I think this is a great idea. I put that money away for my kids, and I never paid a dime for college because it had been saved and put away. And it was all tax-free. It paid for their dorms.

It paid for their food. and Alex eats a lot. And it was great. You had meal plan. Yeah, Michigan is losing money on Alex. And the very end of Louis College thing, Alex went to a less expensive college, was just a little bit of money.

But it was the best money I ever invested, I have to say. Anyway, I was speaking of which Alex was your turn 21. Congratulations, Alex. You're on your own. All right, Alex. I know. Good for you, man. Of course, he was studying last night.

I was like, Alex, go get a drink. Go get a drink. He said, my guess is he's already done that. No, I know, but he's like, that might be a good idea. I was like, I have to study for fluid dynamics. Look, the, this is the bottom line, or this is a theory you want to tap into. The most profitable businesses in the world

tap into one thing, and that is a flaw in our instincts. We're desperate for affirmation. We're desperate for free gaming. we're desperate for opportunities to procreate. So we buy Ferraris, we go on Instagram, and we gamble. The highest margin products in the world tap into a flaw in our instincts, you want to reverse that and tap into the following flaw. And that is, humans are really bad with respect to the time-space continuum.

What do I mean by that? Because for the majority of our time on this planet, we haven't lived past 35, and now we live to 80. people have no sense of how fast time is going to go. And they say, well, the markets are of 9% to 10% a year, that's nothing. I'm not going to invest in the markets. I can make more money as a ball or opening a restaurant

or opening my company goes public. You are going to graduate from college. You're going to blink. You're going to have a couple kids. You're going to have some joy. You're going to have some grief. And you're going to wake up and you're going to be fucking 60 years old. It happens so fast.

It's great. Save money. You want to at a very very very, You want to, at a very young age, figure out a way where you don't even get the cash in your hands. Matching programs at work, 529s, baby bonds, automatic withdrawals, and just a little bit of money from an early age, and then blink your 65 and you look at that account, and you have a shit ton of money. This is a flaw. This is your revenge on the, this is a way you put scaffolding on the instincts that are flawed. Yeah, I agree.

Scott, one more quick break. We'll be back for predictions. For the last 10 years, everything in American politics has basically revolved around one man. And as a political journalist who came of age during Donald Trump's rise in 2016, I've had a front row seat. I am officially running for President of the United States. It's going to be only America first. America first. Thousands of supporters of President Trump stormed the U.S. capsule building.

But is it possible to talk about politics without talking about Donald Trump? That's the question I'm going to ask in our new show from Vox. The idea of like a post-Trump or not exactly Trump-focused show can exist because he's not really driving any agenda items. It really does feel like so reactive. You know, I think this Iran thing is also going to cause a big split in the GOP. So far it doesn't among like people who say their MAGA voters are still with Trump. But like for the first time you see on a major issue open opposition from the start of this war. I'm a Sted Herndon.

And welcome to America, actually. Okay, Scott, let's hear up predictions. Is it about Allbirds? Now that it's an AI business, no, just move along. Oh, I had two, and one of them was Allbirds. Okay, go for it. Okay, so I'll go to that one because you prompted me. My prediction was going to be Anthropic IPS before Open AI,

but that's boring and I've already talked about Anthropic. So I'll go to the one you suggested. The Allbirds pivot to AI will inspire a much of copycats. you're going to see Chegg, GameStop, rent the runway, all decide their AI companies. So this is what's happened. Allbirds the once-hyped sneaker brand. They just sold its IP for $39 million two weeks ago, down from a $4 billion peak valuation, is rebranding. Uncomfortable sneaker business, but go ahead.

Is rebranding as Newbird AI and pivoting to leasing AI chips. The company is buying $50 million or secured $50 million in financing to buy GPUs and lease them to customers. and shares spike nearly 900% at intraday highs on the announcement. So what is this going to do? Just like, remember when Bitcoin treasury companies went crazy? Yeah, yeah. All these different companies decided they were now Bitcoin treasury companies. So we've seen this movie before, and it doesn't end well.

Long Island ICT Corp rebranded as long blockchain in 2017 to ride the crypto wave, and its shares were eventually delisted, and the SEC brought insider trading charges. Shocker. New bird, if you will, what I call new bird, will soon be no bird. So the prediction is the following. All bird in this ridiculous fucking jazz hands pivot to AI that resulted in a massive one-day spike, ton of competitive, ton of copycats, and it doesn't end well. What does it end?

How does it end? These companies have short-term pops. The insiders who get the shares before they announce it, dump the bag, and then the people who think this is anything resembling a company with enterprise value end up losing a shit ton of money. Similar to all the Bitcoin treasury companies. When you try and it's like remember in the early 2000s when I remember being in a meeting, a board meeting at William Sonoma where we seriously contemplated changing the name of the company to Williamsonoma.com because we thought that would add shareholder value. And Howard Lester, who was one of like the clearest blue flame thinkers in

retail, is like, that's just fucking stupid. We're not doing that. Anyways, when you're just trying to create the illusion you're in a hot area with absolutely known domain expertise, IP, or advantage. Sure, call it AI, a pop. If you're in Albirds right now, just take it from me, sell.

But you're going to see a dozen of these things announced in the next 90 days. It's so stupid. People did mock it, which is good. All right. I have no predictions today. I predict that Scott Galloway

will be a star of my show this weekend. Everybody watch it because Scott is very funny and actually has a lot of serious and significant things to say about health care and longevity. And he's really good. I don't remember that part. I remember falling asleep, but I don't remember saying anything substantive.

You did, and you sound great. You sound really good. You actually say a lot of substantive things. Anyway, he looks great, and you get to see him sleep. Anyway, we want to hear from you. Send us your questions about business tech or whatever's on your mind. Go to nymag.com. Spivit.

A question for the show, we're called 85551 Pivot. But elsewhere in the Karen Scott universe this week on Prof G. Market, Scott spoke with Catherine Ann Edwards, Ph.D. Economist and Bloomberg News columnists on why AI has only one factor behind the challenges young workers are facing. Let's listen to a clip. It's not as if the only thing standing between young workers and a job is what private employers are doing or say they are doing or will do with AI. We have a weak economy and a weak labor market with terrible social supports and almost no investment in people that don't have a job. There are solutions that don't.

have to come from just knowing more about AI, but have to come from holding our policy makers accountable for economic mismanagement. AI is today's story, but there will be another one. We weakness is weakness in the labor market. We don't have great infrastructure for helping people who don't have a job. That's 100% right. It's so true. She's super smart. You'd like her. Yeah. Anyway, that's the show. Thanks for listening to Pivot. Be sure to like and subscribe to our YouTube channel. We'll have lots to talk about next week. There's so many topics happening. And we'll be back next week to do so. Today's show was produced by Lara Amund, Zill and Marcus, Taylor Griffin, and Todd Wiseman.

Ernie Intert engineered this episode. Manala Moreno, edited the video, special assistance from Kay Callagher and Brad Silvestor. Thanks also to Drew Burroughs, Mr. Varian, Dan Chenlin. Can AI replace all these people? Nishad Kerou is Vox Media's executive producer of podcast. Make sure to follow Pivot on your favorite podcast platform. Thanks for listening to Pivot from New York Magazine and Vox Media. You can subscribe to the magazine at Nymag.com slash pod. We'll be back next week for another breakdown of all things, tech and business. Have a great weekend, Kara.