The Compound and Friends - Reasons to keep Nvidia, Amazon and Apple

Episode Date: June 7, 2024

On episode 145 of The Compound and Friends, Michael Batnick and Downtown Josh Brown are joined by Eric Jackson and Alex Kantrowitz to discuss: the return of Roaring Kitty, Apple and the WWDC, what an AI powered phone might look like, the best bear argument for Nvidia, the Tesla drawdown, if Elon Musk's days as CEO are numbered, and much more! This episode is sponsored by Kraneshares. They're doing a webinar on June 11 at 10am ET with former US Ambassador to China under the Trump Administration, Terry Branstad, and former US Ambassador to Singapore under the Obama Administration, David Adelman. Sign up at: Kraneshares.com Sign up for The Compound newsletter and never miss out: https://www.thecompoundnews.com/subscribe Check out the latest in financial blogger fashion at The Compound shop: https://www.idontshop.com Investing involves the risk of loss. This podcast is for informational purposes only and should not be or regarded as personalized investment advice or relied upon for investment decisions. Michael Batnick and Josh Brown are employees of Ritholtz Wealth Management and may maintain positions in the securities discussed in this video. All opinions expressed by them are solely their own opinion and do not reflect the opinion of Ritholtz Wealth Management. The Compound Media, Incorporated, an affiliate of Ritholtz Wealth Management, receives payment from various entities for advertisements in affiliated podcasts, blogs and emails. Inclusion of such advertisements does not constitute or imply endorsement, sponsorship or recommendation thereof, or any affiliation therewith, by the Content Creator or by Ritholtz Wealth Management or any of its employees. For additional advertisement disclaimers see here https://ritholtzwealth.com/advertising-disclaimers. Investments in securities involve the risk of loss. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. The information provided on this website (including any information that may be accessed through this website) is not directed at any investor or category of investors and is provided solely as general information. Obviously nothing on this channel should be considered as personalized financial advice or a solicitation to buy or sell any securities. See our disclosures here: https://ritholtzwealth.com/podcast-youtube-disclosures/ A High-Yield Cash Account is a secondary brokerage account with Public Investing, member FINRA/SIPC. Funds from this account are automatically deposited into partner banks where they earn a variable interest and are eligible for FDIC insurance. Neither Public Investing nor any of its affiliates is a bank. Learn more at public.com/disclosures/high-yield-account Learn more about your ad choices. Visit megaphone.fm/adchoices

Do we have a sharpie somebody sign Wait, who do you want side Eric who's hotter right now? The best part about that photo was the, were the stand by guys who were just like taking it all in. Like one guy with a Yankees cap just like. Does he have, why doesn't he have handlers that stop that sort of thing from happening? Do you think? That doesn't sound like a big investment.

He even was like, I don't know if this is a good idea right before he did it. No, it's definitely not. He should have people. It's a good idea right before he did it. No, it's definitely not. He should have people that say things like, oh, you know, Mr. Wang would love to do that, but we can't allow him to move along. If somehow this is not a top, not saying it's a top yesterday or today.

In fact, it's not a top. Oh, he literally autographed the top. Like, you guys thought that good-looking Dan Ives in the New York Posted the top. Like. You guys thought that good looking Dan Ives in the New York Post was the top. No, I'll raise you one. It's Jensen doing what he just did. But if this is not a, if we're not near a local top,

then nobody can ever call anything a top ever again. Eric was just on air like five minutes ago being like, this isn't a bubble. So you gotta defend this man. Never mention a magazine indicator or anything anything nothing matters if we're not near it you're saying if in if Nvidia goes up another hundred points we can stop saying we could retire top any such thing yeah yeah the first time

I though I saw that photo that was on the for you page for for Twitter and I swear it was like within whatever five hours of it happening and every tweet was oh that's a top top top, top, top, top. It's so, because it's such an obvious, it's so obviously should be. I was a... Well, it also costs nothing to say this at the top, right? Like, what do you, if you're wrong, who cares?

So I was at a New York Tech Week event right before that happened. And I had, it was all about public relations. And I had just said, I have to applaud a Jensen and Nvidia's approach to the public. You know, he's really out there talking. And the second I walked out of there, I had a text being like, oh yeah, man of the people.

Yeah, yeah, yeah. He's running around a nunnery with a Sharpie, just signing chicks left and right. Well, listen, you almost nailed it, because he has actually been the most well-behaved of the giant. Him and Tim Cook, I feel like are pretty unimpeachable. I guess they all kind of are, except for Elon, right?

Yeah. Like, Nadell is boring. He doesn't offend anyone ever. Jas, he's all business. All business. Sundar Pichai is like, he's had social issues within the company, but they have nothing to do with him. Elon, all business. No fanaticans. But I think that's a good point. I think that's a good point. I think that's a good point. I think that's a good point. I think that's a good point. I think that's a good point. I think that's a good point.

I think that's a good point. I think that's a good point. I think that's a good point. I think that's a good point. I think that's a good point. I think that's a good point. I think that's a good point. I think that's a good point.

I think that's a good point. I think that's a good point. I think that's a good point. I think that's a good point. I think that's a good point. I think that's a good point. I think that's a good point. I think that's a good point.

I think that's a good point. I think that's a good point. I think that's a good point. I think that's a good point. I think that's a Disney. That I didn't see listed. It was crazy woke down there. What is this? So BlackRock and Citadel are among several investors who raised $120 million to get approval for and launch a stock exchange that's based in Dallas. It's not going to be like a physical floor. It'll be electronic. But the home of this thing will be in Texas,

meaning it'll be subject to Texas law. So I think they're gonna be anti decimals. Well, I see them going back to 22. They want to go back to eights. Okay. I think the idea is that the rules on the New York Stock Exchange and the NASDAQ are maybe like too onerous or there's too much wokeness. Like the NASDAQ tells you how many women you have to have on your board and we all know women are terrible at business. And there are things that there's a backlash against in society

and this seems like it's another expression of that. I think if you're Citadel or you're BlackRock, it's not about the social issues. I think it's just another way to make money, right? But like, it'd be interesting to see if they can get any listings. Is this T plus 10? T plus 10, yes, Texas time. It's ready when they're ready.

So the last new stock exchange, the long-term stock exchange, which launched in 2019, has two listed companies on it. Wow. So. They just had the wrong marketing. I mean, if you just brand it as anti-woke, now everyone's going to just pile right in.

Are you saying anti-woke or are they literally saying that? No, I don't use that term. That's what they're, they're not, let me clarify. Black Rock and Citadel not saying that. The news reports are that there is a growing audience of business people who are not down with some of the things The news reports are that there is a growing audience of business people who are not down with some of the things the exchanges are forcing them to be down with.

And so it's being interpreted as, hey, this is Texas, we don't give a shit about social issues, all we care about is making money and blah, blah, blah. That's why you would list on the exchange. Texas has more Fortune 500 companies than any other state. Did you know that blah, blah, blah. That's why you would list on the exchange. Texas has more Fortune 500 companies than any other state. Did you know that? No. I think it's more than 20.

Well, Elon was trying to fight his comp package by going to the Texas. Threatening, leave Delaware. Port of Chancery as opposed to Delaware. So maybe all, all finance, maybe there's a move to get all financial stuff down in Dallas. One of the things in the financial, in the, in the report was that exactly that they want

to be in the Wall Street Journal. The newly formed Texas business courts established as an alternative to the Delaware court of transfer system is another sign of the state's growing stature. The courts are center stage right now as Elon Musk's Tesla holds a shareholder vote on whether to move its incorporation to Texas from Delaware. Musk tweeted, quote,

never incorporate your company in the state of Delaware. So yeah, that's like a big part. That's a big part of this. Isn't that going to be a tough sell by the way? Like you have this big moment, you have a, you know, you're going public and you're okay. Why did you pick the Texas Stock Exchange? It's you have a, you know, you're going public and you're okay, why did you pick the Texas Stock Exchange? It's like, well, you know, we-

Signaling. Yeah, it's- Anti-virtue signaling. Well- It adds risk to your IPO though. So in a way it does, in a way it doesn't. And Matt Levine wrote about this today. Since the advent of Reg NMS,

we have a national market system, which means it doesn't matter where your exchange is domiciled. By law, the investor placing a trade is going to get executed on whichever exchange is offering the best price at that moment. It's instantaneous. But the signaling, it's like you've got to keep the main thing the main thing, but you're signaling to the market that this is your corporate value as opposed to your corporate

values to make money for shareholders. Well, so they would argue- Wait, is this ESG? This exchange? that this is your corporate value as opposed to your corporate values to make money for shareholders. Well, so they would argue... Wait, is this ESG? This exchange? No. It's like, I mean, ESG is one form of signaling and this is another form of signaling. Right. And like, if I'm thinking about buying into an IPO, like, I just want to make sure that the CEO and the board is focused on making money for shareholders. Well, that's...

And that's why, like, taking... But that's their argument. Their argument is the listing fees that we're paying as a public company money for shareholders. directive right now, like the people that would list on the taxes exchange are the people that would argue. So implementing all those rules costs money. That's what they're saying is the reason to do something different. Could they just like get rid of all KYC, AML, you know, just like, we're just going to let it fly. Whoever shows up here. So that's right. So I don't know how- Take your money.

I don't know how much leniency there's going to be about regulations that are federal regulations just because you open a new exchange somewhere. It's not like Texas and Eastern Europe. It's not like a free for all. It's still part of the United States. But the idea is listing. So here's the difference.

Your stock could trade anywhere. We have 11 exchanges in the United States, like large enough ones. It's where you're listing as a company and you pay listing fees. So when you hear a company chose the New York Stock Exchange versus NASDAQ or vice versa, there's a package. It's the listing fees, it's the visibility. Do we get a bell ringing when we go public, will we get the flag hanging outside the thing, or will you put our name in Times Square? Like, that's a whole, so this is that kind of thing, where it's like, actually, we're

going to list in Texas, because we love freedom, and f***ing eagles, and hot dogs, and you know? Is there a private credit fund that gives you exposure to the company's listing on that future exchange? Well, I mean, there better be, or else I don't get out of bed for anything without private credit fund that gives you exposure to the company's listing on that future exchange? Well, I mean, there better be or else I don't get out of bed for anything without private credit. All right. Anyway, I was just curious to see if would you buy a stock listed on the Texas Stock

Exchange or the TXSE as we call it now? I mean, if it was a Tesla, Tesla redomiciled, relisted on the Texas Stock Exchange, of course you would. Oh, this is the funny part. Nobody would notice. Tesla re-domiciled, relisted on the Texas Stock Exchange. Of course you would. Oh, this is the funny part. Nobody would notice. If Tesla moved its state of incorporation from Delaware to Texas, which seems like it's likely,

pending the outcome, which we're gonna talk about later, would any investor care in real life? Not really. We have investors buying IPOs in companies that are telling you, in the S1, you have no voting rights. Investors are like, fine, I don't want them. Like none of the large cap tech companies,

I think with the exception of Apple and Microsoft, actually have shareholder votes that count for anything. Zuckerberg is a boy king. Alphabet separated the voting shares from non-voting shares, I don't know, 12 years ago? So it's like, I don't even think investors care about where a stock is listed. It used to determine how many letters when you took a symbol. If you were NASDAQ, you were four.

If you were anything, three or less, you were New York Stock Exchange. That doesn't even matter anymore. I think it would be funny if, like, I guess it would be Greg Abbott, the governor, if he sort of pulled an A16Z, where he's sort of like, founders are everything. Founders are always right in Texas. And that's why you need to come here and we will suckle. If he started VC, threading about founders on Twitter.

It's a requirement. Yeah. Those multi-part tweets on it. I actually got to do it. Alex, who did you bring to your first interview? My first, oh, okay. So I dropped this in the dock. I saw just the craziest tweet going around today.

And it's a screenshot from Fox News and said during job interviews, employees say recent college graduates have. And I thought the start of the list was bad. 53% struggle with eye contact. 50% ask for unreasonable compensation, okay. 47% dressed inappropriately. 27% used inappropriate language.

21% refused to turn on a camera during a virtual interview. And I'm like, okay, this sounds like Gen Z. And then I saw the last part, and I almost jumped out of my chair 19% of Gen Z or college graduate applicants brought their parents to their interview Your parents will do the job for you you believe this so I mean I had to write it because it like made the rounds On X and I had to write like, you know, does, has anybody seen this?

It's in a survey, a December 2023 survey of 800 employers. I don't believe it. Let me just say this. 19% of college graduates brought their parent to the job interview. No f***ing way. Everything is going to shit faster than we think. Yeah. Fake, sorry, this is not a Fox News thing.

Wait. That survey is fake. 100% fake news. Have you ever heard of someone bringing their parent? No, never. Of course not. No, never. And I've been on this earth for five decades. Can I ask you one thing, though?

Yes. Which of these things do you think is most accurate? I would say struggle with eye contact. Yeah, that's... One out of two Gen Zs can't look at me in the eyes when I speak to them. As for unreasonable contact, that seems fair. That does seem fair. Sure. Yeah.

I think the rest is spot on, but the last one maybe makes us question the veracity of this survey. You know what, use inappropriate language. Only 27%. I know. If this were Gen X, it would be like 80%. I do think we need to cut them some slack. They have not had human contact, right,

because they basically went to college virtual for most of the time. Nobody gets slack there there'll be no cutting of slack. A tiny bit of slack for these guys. No no no no there'll be no I don't I don't do. Or guess what guess what the first five responses are real and Fox News just said just throw this in so we go viral. I mean it went viral so mission accomplished. It wouldn't be it wouldn't be the first time. You ready to go? Yes. You ready to go? Yeah. Yes? You guys are on your feet with anticipation. Excited for the show today?

I am. I am. Ladies and gentlemen, Big John, what show is this? Welcome home, friends. Episode 145. Welcome to The Compound and Friends. All opinions expressed by Josh Brown, Michael Batnick, and their castmates are solely their own opinions and do not reflect the opinion of Ritholtz Wealth Management. This podcast is for informational purposes only and should not be relied upon for any

investment decisions. Clients of Ritholtz Wealth Management may maintain positions in the securities discussed in this podcast. Today's show is brought to you by CraneShares on Tuesday, June 11th at 10 a.m. Eastern. They're doing a webinar with former U.S. Ambassador to China under the Trump administration and former U.S. Ambassador to Singapore

under the Obama administration. On it, they'll be discussing how either Trump or Biden will approach China in their second term and the impact of the US presidential election on US-China relations and how those relations could affect the US-China financial markets and everything else in between. See the link in the description to register for the Crane Shares webinar on the election and its impact on US-China relations. that and we're gonna bring people back on a regular basis that we just want to check in with and we want to see we want to hang out with well what a show we have for you today you have two such gentlemen in the house who do I start with leave this alphabetically do this seniority hey for Alex I don't know all

right Eric Jackson is the founder president and portfolio manager of EMJ capital limited which he founded in 2017. EMJ is a Toronto-based hedge fund focused on AI. ML, long short analysis on tech companies, previous to EMJ. Eric was a managing director at Spring Owl, event-driven partners, and co-founded Ironfire Capital. Eric, welcome back.

I think this is your third or fourth time with us. Yeah. All right, so we're doing something right. Yeah. founded Ironfire Capital. a newsletter and podcast about Amazon, Apple, Facebook, Google, Microsoft. He also authored Always Day One, How the Tech Titans Plan to Stay on Top Forever, which debuted in 2020. Good call. And a current CNBC contributor. Alex is also a returning champion. Welcome back. Great to see you guys.

Roaring Kitty returned this week. Will Morgan Stanley kick him off E-Trade or just play that the SEC does it for them? What do you think? Texas could go after Roaring Kitty. No, seriously, Texas will put him on the flag. I don't understand what E-Trade's, he hasn't done anything wrong.

It's like tweeting gifts. It doesn't look like he's manipulating prices based on short term options trades? No more than when Dan Lo writes a letter and drops it publicly or like, you know, Bill Ackerman goes on TV. I think so too, but not everybody agrees with us. Well, yeah, I see nothing.

Like he's built a reputation and he's profiting from that reputation. With one stock. Would you change your mind if news came out tomorrow that he sold all his calls before expiration this week or what else? Like in other words, would you look at him differently and look at his online antics differently

if he used the rally on Monday as exit liquidity? Which he didn't. Which I'm not accusing him of. Has he tweeted since? Like with, is he doing like daily updates on Reddit or something like that? It's on a place called Stonk. I don't want to make this up.

Is it Stonk Threats or something like that? He's playing it like Buffett. I like it. I was puzzled and a little disappointed, I have to admit, when he basically, you know, the first version of this story, when he started cryptically tweeting out movie clips and all this kind of stuff for, it was a week, I think.

And then like Friday, 4 p.m. close, he's like, ET gets in the spaceship and goes home. And I was like, what? It's like, I thought this is the guy that was gonna like, get into like the value case for GameStop and all this. And we were kind of going to experience that again, round two. And it was just... That seemed like just hamming it up to cash out on the second or third day. What do you think of this theory?

He wants to be back in court. Or I think he testified before Congress during COVID, so it was via video. He wants, he wants to be back in court. Or I think he testified before Congress during COVID, so it was via video. I like the stock. Legendary. He wants to do a freedom of speech thing. He wants to do a thing like, I'm an investor,

I'm allowed to buy, I'm allowed to tell other people I bought, there's nothing that I'm doing that's against the rules. You can tweet gifts. You absolutely can. And he's not giving people financial advice, he's not registered and so long as he's not serving as like the mechanism for somebody doing a pump and dump, which you know nobody has any evidence that he is, he should be able to say what he wants. He's not using non-public information, what is he doing? He's tweeting.

But he wants attention Michael. He does, he wants people to know what he's buying and he's gotta be happy with the reaction. As does Dan Loeb and every other activist who puts out letters. Right. Dan Loeb would say, I write a letter to the board of directors, not to dear teen vogue,

and I'm not looking for publicity, I'm looking for a board of directors to respond to how I want the company to be run Even tweeted anything other than gifts. He hasn't said anything about the stock has he? No, no, it doesn't need to No No, there's there's a count-up. Yeah, no, I think all of these guys roaring kitty Dan Low bill Ackman they want to get rich. Yeah rich. Each trend, they want to make a lot of money.

I love that we're loving them. Dan Loeb, Bill Ackman, Warren Kitty, I love it. I saw Dan Loeb tweet, you know, somebody tweeted to Dan the Roaring Kitty's like lines of like this is 120 million in stock and whatever, 170 million in options. And Dan's response was like the Ali G gif, respect. By the way, Dan Loeb started his career

on Yahoo message boards pseudonymously, not unlike Roaring Kitty, right? This guy. So game recognize game. I mean, I fell off my chair Sunday night when I saw the size position he has in GameStop. And immediately, the tweets that I was reading was going around like, this guy wants to be a billionaire.

He's gonna buy the Raptors. And there is something to what Josh is saying though that he wants this publicity, right? Be this free speech warrior. You feel that drug of that first time around. You lead this revolution quote unquote against the institutions, even if it wasn't really exactly what happened.

Dude, they made a movie and Paul Beano played him. And then he sits at home and he's thinking, what do I do next? So you return back to the drug. But also to your point of like, should they kick him off or should they not? Very interesting that he's using E-Trade now and not Robinhood.

And Robinhood messed up the investors. What's your opinion about why? Because Robinhood, remember during the entire, the height of the moment, Robinhood. Yeah, exactly. And well, E-Trade is sticking the exact same thing. They're not dumb. They're like look what he's not using Robin Hood anymore. Absolutely. Look at him to Robin Hood.

So this question of like which we started are they gonna kick him off or wait for some government body to do it? They're not kicking him off because if they do that like it's not just him. It's everybody else sees everybody So this the damage that Robin Hood did in the middle of this GameStop thing was tremendous to its brand. Investors felt they couldn't trust it. If Morgan Stanley does this, it's just going to hit them. I want to counter that. Counter away. Morgan Stanley's traditional users are not on Twitter. They bought E-Trade and maybe the average e-trade user is active on social

I don't think these are very profitable users trading for zero dollars on payment for order I don't think they care that options. It is profitable Options trading is powerful what Morgan Stanley really doesn't want to your point They don't want to be in the eye of the storm the way the story was. Yeah, don't be the story that being said I think they would love for the state of Massachusetts to demand that they freeze this guy's account. Oh yeah, somebody else do it. That's fine. I think they would love that.

Keith Gillis would love it. And Keith would love that. Because that would galvanize the tribe. Like again, it's the man trying to take us down. He would love that. He's probably sitting there like in front of his computer like, I wish a mother f***er would. Please, please freeze my account. How would that even work, by the way, practically? So he's got these positions in the trade?

Liquidating trades only. I've had to do this as a branch manager a million years ago. If we had clients who were free riding stock, meaning they would authorize a trade with their broker, if the stock went up, they would just sell it, not pay for it, and it was like no harm, no foul because it's a profit. If it was down, they would like ghost, they would disappear.

So we I actually had an on the record interview about this at FINRA because during the financial crisis, we had brokers pitching clients, potential clients, clients say yes, I authorized buy me 500 shares of whatever. And then the stock would be down 12 points because it was a financial crisis. And they would say, I'm not paying for that. I'm not paying for that stock. You bought me three days ago down 12 points. So we had to, so we had situations where people had existing accounts ghosted on a purchase.

You restrict the account to liquidating trades only. That's what something like this would look like. But he hasn't done anything legally wrong. You might not like how he's making his money with tweets, but like, there's no securities regulation that says that he can't show other people his portfolio. So my attitude is let him do what he wants to do, but I can understand why there are people

that are really against it. I think he made a blunder in terms of splitting this up into two parts. If he had initially come back where the guy leans forward on the chair, don't eat, and backed that up immediately that Sunday night with his portfolio. Where would the stop be, 60?

I mean, it went to 60, I think, on its own. 40 something. Just the guy leaning forward 60? I mean it went to 60 I think on its own. 40 something. Just the guy leaning forward. So I think that was the opportunity. And now, like, what's the second act? If he's not going to do a YouTube... It's not 30 bucks today, it's a 15%. I mean, I was surprised.

It dropped down, it came up. You sell stocks short. I know it's not what you're known for, and you're not an activist short seller. No. You would never get involved on the short side with stuff like this, would you? I think it would rip your head off. Like, you know, it's just too, not worth it.

I saw Andy, I saw Andy left started tweeting about this thing again. Three years after, four years after, he's like, I'm never going to do activist short selling. He's like, he's back. And'm never going to do activist short selling him. He's like, he's back. And I'm like, oh man, God bless, God bless this guy. I wouldn't want any part of this thing. Right. So, all right, let's keep moving.

We're going to talk about Apple. WWDC is next week, which I think, what does that stand for? Worldwide Developers Conference. OK. Why does it, why is it called, it's. Okay, why is it always been called that? Why is it called that? So Apple basically does these two different types of events. One is like a device unveil,

which is like here's the new iPhone. And the second is this is the Developers Conference. This is what we want outside developers to build into our operating systems, on our devices, App Store, et cetera, et cetera. So it's going to be a moment for them to go to the developer community and say, here's the ways that you can work with us. Because without the developer community, the iPhone is basically just a piece of glass.

You need the developers to build it on top and this is the moment where everybody comes together. Jobs did the keynote for this one also, historically. It was the job show. Is Worldwide Developers Conference where we got our first look at the first iPhone or did they do that at one of those one-off events? I think that was a one-off event. I think that was a January event. In 06 and then it came out in 07 something like that. Alex, is there typically a big reveal here or what do we expect to learn? Well usually at WWDC no like it's mostly operating system focus but this year we're expecting something very big Which is that this is going to be like the biggest announcement Apple make at WWDC in years

Because this is when the big AI announcement is coming and now there's been a lot of trickle out trickling out of like what might come And we still don't know the full details It initially started with like some really small things and some really just like kind of meh things that you would hear like better voice Mammo transcription like okay, if that's the big announcement I just will not hold the event. But as we've gotten closer we've heard more and more about Apple trying to make big changes to the operating systems themselves with AI. And that could mean for instance using Siri to operate

different devices. Here's one example. They could, this is from Bloomberg, they could ask Siri to summarize a recorded meeting and then text it to a colleague in one request. Or an iPhone could theoretically be asked to crop a picture and then email it to a friend. So basically the idea is they're going to use AI to combine everything that's going on on your phone and save you all the tapping through and all this busy work you might have to do just to be able to make your stuff execute simply. So there's gonna be operating system side changes

and then we expect them also through a partnership with OpenAI to introduce a much better Siri that's actually not a pain to talk to and has like some of this cool chat bot functionality that we've seen come out in ChatGPT baked into the iPhone via Siri. It seems like there's two stages of AI now. The first stage is turning these personal assistants

into actual personal assistants where they really can do things like, hey Siri, transcribe this meeting. Hey, do you mind if Siri listens, right? And like have a meeting and then summarize or pull out all those stats or the key points. And then the next phase is agents, an AI agent, where you can say, hey, Siri, get me tickets to Taylor Swift

next month. Make sure I'm in like no higher than row G, you know, blah, blah, blah, blah. And that's it. You're not screwing around with credit cards. You're not opening apps. like no higher than row G, you know, blah blah blah. And that's it. You're not screwing around with credit cards, you're not opening apps, you're not doing what's my password. Like literally you have an agent out there on the web accomplishing a mission for you. be the company that builds that given that they're basically trying to build on top of open AI and

Not really their own LLM or or whatever like what am I misunderstanding about that potential? Yes, there's two parts to that question. Can Apple be the company that does that? Yes, definitely They can build the AI agent. I think so. I mean, okay. Yeah, they're well positioned. They have the hardware What have they ever done before so that's so that's the second part of the question, right? Which is given the fact that they had to rely on OpenAI. The fact that they're bringing OpenAI in is something of a failure. We know that they were slow to adopt this technology.

There was another report in Bloomberg that said that one of their AI heads thought, who needs another chat bot? Well, first of all, they had one running in the device, Siri. And second, yeah, a lot of people wanted it. So they'll have to be able to prove that they can do this, not just by using their size, which they've done, or by refining, but by inventing.

And that's been something that hasn't come easily to Apple, although they have done the Vision Pro. That's an invention for sure. They need to basically find a way to build that. Because if they don't we're gonna see more scenarios like the one we saw just now which is that they're gonna rely on a third party and Apple does not want to rely on third parties because it knows what it's like to have to rely on a third party because so many third

party third parties rely on them and they squeeze them for all it's for all the rest. Let me ask you guys this so our buddy Dan Ives tweeted that WWDC represents the most important event for Apple in over a decade. I'm skipping ahead. He says, we believe AI adds $30 to $40 to Apple's story. I'm curious, how do they monetize this? I'm going to guess per share. Where does that multiple, the incremental revenue,

the earnings, the market cap, where does that come from in the AI story? I'm skeptical. I'll disagree with Dan on that one. I mean, if Apple was at 165, I would have said, you know, they're being underestimated in AI, and you've got to get behind it. And it's not true that Google and OpenAI are the only AI game in town. Nearly nearly 200 now?

They're already getting, you think they're already getting the benefit of the doubt of whatever they're going to unveil. My guess is that this thing is going to drop post-WWDC, the stock price. You know, it's, it's, it's, you remember when everybody used to blog, live blog Apple earnings? Yeah. And we used to say like, oh, we're two minutes into the keynote and the stock is up. And then like seven minutes later, like, Oh, the stock is tanking. And so you think this will be an underwhelming AI announcement and that won't be enough given how much the stock has already appreciated into it.

Even if it's functionally brilliant or when it is in your hands, it is, it is exceptional. I think there will be an immediate like, ah, this is nothing. I think it's a decent call because the stock is right near an all-time high like it's right there And does it deserve to be? Fundamentally no it's all in anticipation of what they're going to say Monday Yes, 10 a.m.. Pacific time which is 1 p.m.. New York time they better deliver Eric you're right They better deliver something. Yeah, it's just the most It's just the most under pressure Tim Cook has ever been going into one of these events, do you think? I feel like it is.

Definitely. I mean, this is the thing about running these big tech companies. It's all about your ability to adapt. You think about Microsoft. Why is Microsoft the most valuable company in the world right now? It's because they were a desktop operating system. And they saw two shifts coming. And under Satya Nadella's leadership they adapted. Under Steve Ballmer we're like we're going to make the most profit as possible

from Windows. But then Satya comes in and he's very good at adapting. He said no, we're not going to do this desktop operating system company anymore. We're not going to do install and we're not going to spend our time installing servers in people's offices. We're going cloud. They rode that cloud thing. They had basically given it away to Amazon. Now they're strong number two. That's really helped them transform themselves from like an old stodgy company to a company that has a piece of the future.

And they did it again with AI. And that is a cultural thing. For Apple, like, yes, Tim Cook has to be able to show that he can also lead an adapting moment because he was blessed. He came in. Steve Jobs basically, and it's not all Steve, but Steve Jobs handed him a lead in the most important device

for the next decade or more, which is the phone. And it's still going to be the most important device. Who's the next guy? He's 63 years old. Is there any talk about succession planning? He's not old, but you know. Who, Cook? Well, Cook did the watch, and Cook did the AirPods,

and those are the number one and two best-selling wearables ever. So those are great inventions, absolutely brilliant business moves. They're just bolted onto the ecosystem that already existed. Correct. So if you think that AI is a computing shift, which everybody in Silicon Valley seems to think

that it's going to be, that will require an adaptation within Apple to say, listen, we have the iPhone, we're going to ride that, but we need to prepare ourselves for our next era. And that's much harder than inventing headphones. 3 trillion. Not a lot moves the needle when you're that big. Well, I think the most amazing thing that Apple has done is that five years ago, everybody measured them on price to earnings. And the people back then were saying,

it's too expensive relative to historical norms on an earnings basis and what more. And Apple changed the whole model to, this is a subscription. You and your family are buying more stuff every year. You might not buy a phone every year, but you're buying iPads, you're buying AirPods. And so think of it as a lifetime subscription.

And value us on a more like a price to sale basis. And all of that. You're right, because they were valued at 13 times, 15 times earnings for a long time. Right, so they went from like a 2X price to sales to I think they're now like 4x or something like that And so that is the brilliant thing, but what makes me nervous about the AI stuff is that It's it's incremental in terms of like is it is it gonna make you want to buy a new phone this September?

Look, there's a wild chart. This is their price of sales It was between it was basically under four from 15 all the way to 20. And then there was a gigantic leap forward and now it's eight times. Because in the first half of this chart, it was a company selling consumer technology, which is gadgets, which sucks. In the second half, it's ARR. Daniel, and that's another similarity with what Alex was saying about Microsoft. Same thing, Balmer, price to earnings.

Satya, subscriptions. At the wazoo. But also, Eric, wouldn't you argue that there is some risk here for Apple? We don't necessarily see the incremental gain, right? Obviously. We don't see the obvious incremental gain. But I can promise you, there's going to be one company, we've seen sort of hints at this with YouMain and Rabbit, who've tried to do their own devices and they've sucked.

But someone's going to say, we're doing an AI phone. And you can't ignore that if you're Apple, because there is a chance, if it works according to specifications and AI continues to improve, that you could be behind. Who's the leading candidate to try to pull that shit? Is it Qualcomm? Or an Amazon? I think it's just, it could be, it honestly could be some random startup to try to pull that shit, like the Qualcomm or an Amazon. It honestly could be some random startup that takes Android

and finds a way to wrap Android together with some AI technology, maybe from OpenAI, and find a way to build this new device. What does that mean? What's an AI phone? where like you, the main way that you interact with it is through artificial intelligence. I would say that there is precedent for that. 3Com was, and also ran, came up with, like the Palm Pilot legitimately at one point was eating into Nokia and Motorola. What, we have sound in the headphones? It's Brian Park.

Oh, so this is part of the, this is what we're doing here. Pretend we're out there, actually. Welcome to New York. Yeah, so it has happened. All right, I want to keep... Wait, just one more thing. Please go ahead. Let me give you one more candidate here.

It's Sam Altman. Sam Altman and Johnny Ivey. He could do a device? Is he funded to do devices? He's been talking with Johnny Ivey, who worked with Steve Jobs to build the iPhone, the head of design, about building a hardware device. Okay. So it could be them.

That would be dangerous for Apple because- Which would be a Microsoft device? Well, this is where you get into the real weirdness here because like, first of all, Microsoft has like funded OpenAI and they're running on the servers. Now OpenAI is going to do this big deal with Microsoft, with Apple and Satya Nadella and Sam Altman had to meet to discuss how this would work operationally.

But beyond that, and there was a great story in the Wall Street Journal this week, Sam Altman does, who's the CEO of OpenAI, does have various conflicts of interests. He has the startup funds where he's funding with his personal money startups that are working with OpenAI. And OpenAI is doing deals with them, so it gets tricky there.

My understanding is if he does a device, it would be separate from OpenAI as well. And then you start to get into some strange territory. So Alex, your book is How Tech Giants Stay on Top Forever. Do you see any risk, like clear and present danger for them other than maybe this OpenAI company? Or are they just going to be the winners for the next 10 years that we keep on talking about? Whose day? The Mac 7. Okay, the Max 7. Yeah, I mean, so it's called always day one because the best thing about being in your first day as a startup

is you build exactly what the market needs and you don't worry about legacy, right? Because there's no legacy to worry about, whereas bigger companies tend to spend... They don't want to cannibalize whatever's making their money now. Exactly. So they spend all their time hanging out on legacy and they just miss what's coming next. Media is a great example. Paramount. Yeah, absolutely. And all those companies. So I do think by and large, and we're going to talk about Amazon later, which may be the one that's at risk, but by and large, these companies are the ones that have

been able to adapt over and over. And even when you count them out, like remember we're all counting out meta like about a year, year and a half ago, they find ways. Google, Google, exactly. They have baked into their culture this ability to adapt and then tackle the next computing system. And by the way, their size doesn't really hurt in these moments. Don't you think the fact that so much of their business

is digital, that they're able to adapt continually versus the incumbents of the 60s, it was physical. It wasn't digital. Digital helps. Definitely. No, it helps. And also, there's awesome moments that happen in this world.

Because think about meta as a play in artificial intelligence. Sometimes you're building for something, it doesn't work, or you invest. And then you're very quickly able to pivot to something else because you've made the investment. And I'll just kind of flush this out a little bit. Meta bought hundreds of thousands of GPUs.

For the metaverse. Not for Reels. Actually, no, for Reels. They say it's for Reels, but Reels, Metaverse. But in the beginning, it wasn't for Reels, or was it? No, I think they saw TikTok, rightly, as an existential threat. They invested in all these GPUs from NVIDIA.

We're a very early customer, because you need a ton of artificial intelligence to run the recommendation algorithms on reels. Just as they had made this investment and were improving reels, they saw how big AI was going to be. And they were able to train much better than so many else because they were in supply constraint. They had the NVIDIA GPUs.

So this idea that it's digital and you can change quickly, it takes a nimble mindset. But it is easier in tech because you can use the sort of the technology that you were betting on for something else and quickly pivot there if you have that strength. So had they not bought all those GPUs for the metaverse, and let's say they were 12 months late to this game, would the market cap look a lot different than it does today if they were so far behind TikTok?

I think so. I mean, you guys were talking last week with Stephanie about how so much of the way that people value stocks is sentiment. And what would the sentiment be on meta right now if they had completely missed the AI moment? If they didn't have llama and if they didn't... They could be toast. They are looking like a leader and because just this fortuitous bet they had made on the GPUs has really helped them.

I want to just, I want to get into some stock stuff with you, Eric. But before we do that, from Alex's last show here, you were on with us October 6th of 2023. And I was laughing, I was rereading some of the stuff that we were talking about. I said one of the biggest risks to the market, I still think this, is a hiccup to the AI story. Like if something goes wrong,

or if there's some random drop-off in demand that nobody was expecting, like mathematically these companies are so big, that's a fundamental risk to the market, not the economy. The market, your argument was Nvidia still has room to grow. Good call. That was right. 1.7 trillion cents, opt that.

You said the real hot take is that open AI versus Meta's Llama AI product is the real battle Which might still be true? We just don't know yet the mag 7 are up if you equal weight them in total return 37% since that since that October Appearance till now so they all they also had room interestingly Tesla is down 33% since then Nvidia is more than helping to balance that out up 155%. 155% since then.

So good call, good calls all around. You know what's funny? Eric was on just a month later. Yeah. And we titled the show, the AI Moment Comes to Wall Street. It did. All right. So Eric, you were with us a month later, November 3rd, and S&P is

up 21% in total returns since then. The 10-year is actually slightly higher. And I'm just going back through some of your stocks. Carvana was an absolute freight train. What a call. What a call. Nobody liked it then. I didn't buy any. Up 213%. Top performer in the Russell 2000 over the last year. Up 582%. And the 39th best performer year to date up 93%. Well done. You made some money there?

Yeah. Are you still in Carvana? Yeah. Still in it. Still like it. So give my audience the next Carvana, if you will. I want to hear your Nvidia thoughts. So you're still bullish, so am I.

I'm just like a very nervous bull because now everyone is bullish. That's true. I don't know if you could tell, but I'm a little bit of an iconoclast. I don't like to agree with everybody. And I find basically now 60 analysts or bulls on Nvidia, a couple of neutrals in there, no sells.

And we have all just decided Nvidia is the biggest AI winner now and forever. And touch tips today with Apple in terms of market cap. They hit three trillion. They're so easy with that terminology. And touch tips, I'm just saying. We're not going to do touch tips. They did.

All right. It took me a second to figure out what to say. It's almost too much. What's your Nvidia thoughts these days? I still think it's inexpensive. I wouldn't say cheap, okay? It's inexpensive. And so, and I think it's pretty remarkable when you consider how much love there is and

it seems to be like universal love for it. But what's amazing is if you look back at the last five years on a forward PE basis, Nvidia at the end of 2023 was like one standard deviation below the mean for that period. And so, and yet the stock had an incredible 2023. one standard deviation below the mean for that period. And yet the stock had an incredible 2023. It started the year like 146,

ended the year 480 or something like that. And so I think people just fundamentally couldn't believe that a stock that had run that much could be cheap. They've never seen earnings growth like that in a company that size. It just doesn't take place. And they thought like, okay, maybe like that in a company that size. It just doesn't it doesn't take place. And they thought like, okay, maybe May that May quarter that just sort of like everybody

sat up and took notice was just an anomaly. And we're going to go back to kind of the normal growth. And yet, we did it three more times. Yeah. And like they, you know, it keeps going. So right now they're they're at the they're at the. They're like 38x forward PE, I believe. But this is the stock that has, you know, if it was one standard deviation above the mean, I'd say this stock's expensive and you might want to lighten up. The thing is in the last five years,

there have been periods, I think three or four times in the last five years where this thing has gone like one and a half X standard deviations above the mean. If it did that now, it's a $2,200 stock. Oh my god. It was 38 times forward a week ago now it's 45. I mean the move is just ridiculous. So what- Devil's advocate, as companies get larger, their valuation should get lower because like growth becomes harder to come by eventually. For every other company. Right, but I know that hasn't been the case here for a while.

So, Eric, what of the bearish arguments, and I'll just throw one out there, do you think are total bullshit or not as big a concern? For example, the fact that half of their revenue base comes from four customers or whatever the number is. What do you think about that? Just these Mag7 companies that Alex was talking about before, they're going to be here for a while. They're not going anywhere.

They're not going to be disrupted tomorrow or next week by OpenAI because they are throwing off gobs of cash. And they have this sort of core stable business that is likely to continue to throw off cash for a long time. So they can spend the billions on the H100s, H200s, B200s. One way around that concentration argument is that the hyperscalers are not the end customer. They're a conduit.

The end customer is every other company on earth and every municipality and every country that wants to build things on AI. So if we think of Microsoft's purchases of Nvidia, it's scary, because they're probably 10% customers, I don't know. But Microsoft's customers are, I don't know, where they have 500 million customers. There was like a sinister line from the Nvidia conference

call a couple of weeks ago, it's like, talked about sovereign AI's Yeah, and then the idea was like, you know The UAE and Russia and Singapore are like building their own AI using this stuff And so we don't want we don't want to sell the UAE the the highest tech version of Nvidia chips. There's like there's like Security reasons why the government is telling Nvidia not to do that, right? If they invest seven trillion in Sam Altman, then maybe they'll get those chips.

Here's another one. These companies spent 60 billion or whatever the number is on these chips last year and only drove $3 billion in revenue. What would you say to something like that? Listen, I'd say the best bare argument against Nvidia is like where are the apps? And how many people are making money on it? The best bear argument against Nvidia is where are the apps?

And how many people are making money off? Besides Nvidia making 75% gross margins, you look at some of the recent results for Dell and HPE just this week. I mean, a lot of companies, they're selling all these AI servers, and they're not making hardly any margin on it. So Nvidia is in this kind of weird position where it's sucking up literally all the profit in this space.

And so, is that sustainable? Probably not. So, that's the last question for me on this is, where are the competitors? Who is going to go, like legitimately go head to head with NVIDIA? Everyone and no one. So, everyone is announcing AI equipment, software, and chips, but no one is going to be like the Pepsi to Nvidia's code. Isn't this like how we were taught about competition? Is that when you have abnormal profits,

somebody comes in and competes? Tell Google that. 25 years, no competing search engine. It doesn't always work the way you think it works. It doesn't always look like McDonald's or Sprint. Well, no competing search engine, but competing ad networks, Facebook. The thing with NVIDIA, and anyway, I'm sure you guys know this, but they have both the hardware, the chips, and the software that developers train large language models on.

So this is a momentum thing, right? They have so much momentum in terms of like people who are developing AI, this is high stakes for most companies, it's the top priority. They know they can do it with NVIDIA's combination of chips and software. And so to switch off is a big risk. Even if the other chips are performant or they're cheaper, like you have to spend a lot of money for these NVIDIA chips,

but you're not going to risk your company's competitiveness or your number one priority to try to get a discount. And that's why Nvidia is going to maintain this lead for a while, but I think Josh is right in saying they are selling to an end customer and the end customer needs to see ROI there. And actually, if I can take you guys in quickly to how the tech industry is thinking about this moment, it will sort of give us some thoughts about where this might go.

So I think there's two tracks on AI development right now, where those end customers are taking these chips and what they're doing with this compute. The first is that we have technology today that's actually quite useful, like GPT-4, oh, GPT-4 from OpenAI, the latest models, these latest cutting edge models. They're going to be put into place

in a lot of interesting ways, especially in enterprise computing. That's why you see companies like ServiceNow doing crazy numbers in earnings, because they've figured out already with the technology we have today to build it into something that is going to be worthwhile, and why Microsoft is selling these $30 a month seats in office, because they're like, all right,

for this copilot. We're like, they're like, all right. For a co-pilot. Co-pilot. They're like, this technology we have today is good enough that we can sell you a service worth $30 a month. The thing is that even, well, to build on that, the tech today is 50% cheaper and two times faster, which means that OpenAI's GPT-4 release offered

better technology, so smarter technology that's faster to build on. Then 2.0. Yes, then 4. Oh, wow. So 4, it's better than 4, and it's faster than 4, and it's cheaper than 4. They cut the price in half. And so all these developers, all these tech companies that we're going to do on the current technology that we're doing these ROI calculations of should we build, now they're going to go

build because it's that much cheaper so you couldn't get an ROI in places that you couldn't get before. And so there's a belief that the current technology that we have today is going to already spark an increase of development and we'll see where that shakes out. It might be that it's like very useful for law firms

but not for consumers and that's where this current generation of technology lands. But the big thing that's going to happen and every tech company is pushing towards this and this has been a big part of Nvidia's revenue is that there is a belief within the tech industry within the big companies in particular the OpenAI's etc that over the next 18 months we're really going to see what happens to these models when you put way more

compute, way more CPUs or GPUs towards it, and way more data. Because the more you put in, they've increased, like you put in X amount more, they've increased exponentially. And so now they're buying up big time to try to make these models better. And no one knows, like they're about to throw like a god amount of compute and a god amount of data, like as they're about to throw like a god amount of compute and a god amount of data. Like as much as you can. I was gonna ask you, is all the usage

making these models better? So they're not just training on the internet via two years ago, but like they're training every day with actual human prompts and queries? Is that like improving the service? Yeah, that's like the refinement of the models. And they do some integration so you can get the internet on like Bing, for instance, with its AI. But this is going to be the biggest test for the tech industry in like, I'll say, recent history,

is whether that 18 months of development, which is where all this money, not all of it, but a huge amount of this money to... It's why Nvidia is worth 3 trillion. Exactly. It's on this bet. And if these models continue to improve exponentially in 18 months, I'm telling you we're going to have people saying, we've reached artificial general intelligence and the products are just going to be insane. But if that doesn't happen, if it's just incrementally better, then the air can come out a little bit. So where do you place your bets? Is it going to happen? Man, I don't think it's going to happen on the timeline.

I think it was going to take longer. I think basically there's going to be a ceiling to these techniques, and then they're going to have to find new text. The research labs are already saying we're going to do more than just put more compute. We're going to start to refine a little bit. But it is GPT-5, which OpenAI just announced their training,

although they didn't say GPT-5. It's going to be really good. But I don't think that we're going to see artificial general intelligence in two years. And so what does that mean for the price of these stocks? In other words, is this like fiber optics cable with the internet where, yeah, it was a thing, but we pulled so much of it forward

that the valuations, the prices, all that, it just couldn't possibly be sustainable. I think there's a floor, but I can't tell you right now whether A, like Nvidia is sustainable, and whether they're going to leap even further if this technology proves its potential. Alex, one of the things I predicted was a mania, and I thought there'd be like 1,000 IPOs by now that were AI this, AI that. he proves it's potential.

What's VRT? Vertiv. Vertiv is like cooling off servers. Liquid cooling for, you know, basically make the deal. So, all right. So those- Gone from 12 to 100 bucks in a year. Those stocks are crazy, but like there's not 20 of them and they're both profitable I think. Yeah.

Ish. Well, just enough- Breaking through. Yeah, I mean- Right. So what we didn't get this time, probably because of where interest rates are, we didn't get the rush of me too, copycat bullshit, where you just rename your company AI,

go public, four billion dollar valuation. You know what's had a bubble? We don't have that. Nvidia aside, even the ticker AI is not doing anything. If there was a bubble, this thing would be up several hundred percent. You know how many stocks doubled in the S&P 500 in 1999? 39 stocks were up more than 100%.

We don't have that right now. And where the chip, like you would think, like, is another chip company going to come around and like overtake them and knock them off the perch? Like you would think that there'd be a little bit of pixie dust in some of the multiples for these other, nothing. And Nvidia itself, like what I'm saying is like it's not trading two standard deviations above its historical mean in terms of like it's it's prior And the either like micron either the stocks that are them that should be the most caught up in a frenzy

If this truly were a bubble or just not acting that way, right and the people talking about them are not speaking that way like even the the biggest bowls seem to be like hedging how excited they want to get. I count a point, Nvidia added $300 billion in like 72 hours. Exactly. No, no, I think that part of it is this, why we're not seeing the small guys come up

or the really weird valuations for others is because so much of this moment is predicated on scale. Like without scale, you can't play. And that's why Nvidia is gathering so much of this moment is predicated on scale. Like without scale, you can't play. And that's why NVIDIA is gathering so much of the benefits and why we're seeing companies like Meta and Microsoft and Amazon and Google. That's all we talk about with AI. Because if you're not them, it's very difficult to play.

You still like Dell and ARM? Yeah, I do. So I think there's there's gonna be some Others that come along for the ride with Nvidia. Yeah, and I think Dell I mean, what's the Dell story? I don't know anything about the company. Dell was like nobody was paying attention to it Because it had recently we come public from PE. Yeah, what else do they do? Honestly? I don't know. So PC think of like, you know, you turn on Jack Ryan. Make beige or gray boxes. No, I have one. But other than that, is that still the core business?

So like half and half, they have that. And then they have this network ISG business, which is basically, you know, we'll come into your your Red Holes Wealth Management, we'll set up your servers, we'll sell you the networking gear, the professional services to do this. So you can, we'll sell you all these AI servers now. We'll sell you storage. And so the thing that I like, I mean, a couple of years ago, this thing was like a 4x forward PE. You know, this thing was dirt cheap. Now it ran up to like mid teens, you know, just prior to their earnings a week or so ago, and now it's like dropped it down like sub 10 again. So relative to like a super micro at like, you know,

I think it's like almost 20X, you know, and a Verta which is like was, you know, 30X forward. It's nothing like that. Now I think those guys will come down, but I think Dell's gotta come up. And the thing I like most about Dell, besides just a value play, is that they're selling these AI servers. They're not making that much money today.

But the thing is, when everybody deploys these servers, not everybody wants to run them in the cloud. A lot of these companies are going to want to keep their stuff on-prem. Dell's there for them. They set all the servers up. And the other thing that Dell sells is storage. And so you've got to spend money on storage

if you're going to be manipulating these models and stuff. And a couple of earnings call ago on the Dell call, somebody asked, for every dollar in AI servers that you guys are going to sell, which was $1.7 billion in the last quarter, where they didn't show much operating margin at all on them. And that was like what Tony Sakenaghi and others got kind of mad at them for. But they said for every dollar of those AI servers, it's not going to happen right away, but like a quarter down the road, two quarters down the road, three quarters, how much storage are you going to sell?

And is it going to be something like $2 to $3 in storage, which is a good margin business? And the COO said, yeah, you're not far off on that. So I think they will make a shit ton of money on storage. And then of course, professional service. Do they buy EMC? What's their storage business based on? They must have bought somebody.

I think that's right. What was VMware? They had a relationship with VMware. This stock is up 400% in five years versus the S&P's up 100%. This has been a huge home run since it re-came public. I think before their earnings, where they were down like 18% the next day after earnings, I think they were year to date ahead of Nvidia on the year in terms of...

So, you know, people sold it off because of the operating margin issue, but I think, you know, they're going to see, you know, more storage business. What's the story on Arm? Last thing before you get to Arm, just history was made today. Nvidia, the market is closed and Nvidia is now larger than Apple. We did it? Wow. I knew this was coming. Holy shit. We said this would happen. Apple. We did it. Wow. I knew this was coming.

Holy shit. We said this would happen. 3.01 versus 3.02. Unbelievable. Sell seems wrong. It seems wrong. Josh, you said your number to sell was $3 trillion. Are you going to sell?

I think I have to sell some more. If they go to $1700, which I think is possible by the end of the year, they're going to be $4 trillion. Oh my God. Why not? Crazier things have happened. What's the story on Arm? It's an expensive stock.

It almost got bought by Nvidia a few years ago, which would have been really interesting. Which says something about, I think, why you should be interested in Arm. 90% of the float, I think, is still held by SoftBank because SoftBank was sort of like... Are they back? Is SoftBank because SoftBank was sort of like, you know, are they back? SoftBank bank? Well, Elliott, Elliott, the activist hedge fund just bought a huge chunk of SoftBank and may Tell them to sell the rest of their arm holdings. Yeah, and then weirdly arm was up like a lot today even before That's weird. Up 9% And so you'd think like if a SoftBank is gonna dump this stock

It should pressure the price and that should go down but I think I think what people are thinking ahead to is that SoftBank sees something of enormous value here. There's a reason why they only sold a sliver at the IPO last year when Arm came public. It's a CPU-focused company. It's not a GPU-focused company. And think about when the stock splits. Yeah.

So I think there's value here. I mean, there's rumors that they're going to be the chip in the new iPhone that comes out this September. The big thing is their royalty rates are going up a lot this year. Why? Because they just decide to? As they come out with new versions of their chips,

they're able to kind of hike the prices. And so several years ago, when they started, they were getting pennies in royalties per unit. And now by the end of this year, they're going to have a lot of chips out there getting a 9% royalty rate, which is much higher than what it was a year ago. So they had a big moment in February where their earnings really, in terms of their guidance,

surprised people. The stock was up an enormous amount, like 40% in a few days and stuff. So I think there are gonna be more surprises to the upside this year, even though it still looks expensive on a price to a new basis. You are still bullish, Carvana. It's 100 bucks right now.

Eugens going to 200. And it could go to 350. This thing went. This is AI. This went from 350 to three. Can I say one thing? We have one of these towers now, Michael and I. 10 minutes away from our house.

It's right off our parkway. So now you know why they were losing money. It's not like terribly impressive. I don't know. Is that a sideshow? What is that? That tower? That's the business.

Put a big giant coin into that and the clock comes out. That's a gimmick. No, that's not that's what is that that tower? That's the business a big giant coin Into that and the car comes out gimmick. No, that's not the actual business Well, that was that was the knock for the bears against this company for a long time is a gimmick It's you know, they never made car vending machine. Yeah, you literally literally It's a giant glass going to 350 It's a giant glass tower with used cars in it. And they look like toys. You buy it and they let you put a big fake coin

into a slot and the car comes spilling out of this tower. I'm not even f***ing with you, like that's the business. Okay, and the guys that ran it have a colorful history. Or are they still father and son? Yeah. Used car aficionados? Right. Okay, all right. You like Coinbase.

Why do you still, Coinbase has been a huge home run for you also. Stock's been a big winner. I think crypto can blow up a lot more from here on out. I think probably all of us at the start of the year would have been surprised if we'd said. Yeah, and that's definitely good for Coinbase because they're in every part of the ecosystem I guess the ETF wasn't bearish. That was dumb. No offense. That was my I thought the ETF would cannibalize Coinbase's retail business

Yeah, maybe it did but it doesn't matter the institutional business. Yeah, well they get custody fees from that So like there's no more FTX, but we're going to talk about Binance later. They're sort of like gone. They're the big pure play public crypto stock you can own. I mean, there's Bitcoin miners and stuff like that that you can play around with. Well, the thing with Coinbase is that they're much more profitable on retail than institutional,

obviously, right? But the people that the OGs of crypto, They are much more profitable on retail than institutional, obviously. But the people that, the OGs of crypto, the people that have been there forever, they're not going to an ETF, number one. And number two, they want to trade at 24-7. That's like the whole deal. Is that they can trade it at eight o'clock at 1 a.m. whenever they want to buy it. Real crypto people aren't terribly interested in the ETFs other than the fact that they've brought a lot of liquidity into this space. But it's circular because the ETF has driven up the price and then it gets these people more excited to buy and sell

Right and now we have ethers guys. I want to make sure we get to we want to do we want to do Tesla and Amazon Let's start. Let's start. What do you guys want? I want to do I want to do Tesla because I love this chart throw up This chart. It's so pretty So chart can Matt made a chart showing that Tesla has gone So Chart Kid Matt made a chart showing that Tesla has gone 648 days since making an all-time high, which tied the previous record. So de facto, today or tomorrow it's going to break it. Okay, simultaneously, it's in a 57% drawdown and there is a lot of smoke coming out of what Elon is doing with some of the financing of the company and the chips and all that nonsense. So I wanted to set this up. Most of the long-term bulls in this stock are sellers with a couple of notable exceptions. But you have a stock that's down 30% this

year in the midst of a tech rally. It actually looks worse than the Mag 7. Yeah worse than the Mag 7 but actually looks worse than a lot of the car makers too. Which is interesting. Michael mentioned it's in a $600 billion Yeah, worse than the Mag 7 but actually looks worse than a lot of the car makers too, which is interesting. Michael mentioned it's in a $600 billion drawdown, 50 some odd percent. And now you have sellers. So Gabelli sold their entire stake, 66,000 shares that they acquired in early 2022 in Q1. We think the stock works best when there are auto company fundamentals that justify the stock price.

Dude, it's under... Hold on. 18 mutual funds tracked by Morningstar that have held the stock since 2019. Ten of them reduced their positions in the last quarter. Four of them slashed their stakes by more than 15%. Only five actually added. So, Ross Gerber is a seller now, which is notable. It's notable because he's like the most violently outspoken bull.

I think he spoke in bold. Ross turned the wire a little bit, I feel like. What about Ron Baron? So, Cathy is buying, and Ron is, I don't know if he's trimming, but Ron is like team Musk in the pay dispute. So Ron Barron of Barron Capital says that the company in an open letter, the company should pay the $56 billion pay package to Elon because of his accomplishments. It's the ultimate key man of key man risk.

It's true. Ron, interestingly, has a 27.9% long position in Tesla in his flagship. His second biggest position is 12% SpaceX. So I think he likes Elon a lot. Ron Barron estimates that he bought his position for about $400 million between 2014 and 2016. And that position netted him $5.5 billion in both realized and unrealized gains.

In the less than seven or eight years since then that's pretty it's impressive It's pretty baller happy with that return. It's yeah, it's underperformed General Motors by 50% So by the way, no, so by the way, no surprise. He's for paying Elon the money I he's like a lot of long-term show Not in favor of paying Elon the money. I think you give him the money. Yes a contract I mean, they know the rest no Yeah. Because it's a contract. I mean, they struck the contract in 2018. I went back and I watched the video clip

of when they announced it on CNBC. And it was like the Squawk hosts were in Davos. And they were like, well, they signed this contract. He's got to make it. Stock was going to zero. He's got to make this stock go up like 5x for him to really get paid. And he's got to chuckle. And he did.

What do you guys think about this headline from CNBC? Elon Musk ordered Nvidia to ship thousands of AI chips reserved for Tesla to Twitter and XAI. It's ultimately like there's a huge risk in having Elon involved in all these businesses. Like his involvement might be just raised $6 billion for XAI, and he has to make it work. And it's all about scale. And now he has some explanation of how these chips

were just going to sit in a storehouse, and Tesla couldn't put them to automatic use. First of all, why? Come on. Every CEO can deploy these. You mean you had these on order, and you couldn't figure out how to use them in Tesla, which is relying on AI to build self-driving? Like, the explanation doesn't fully make sense, but even if it was the case...

You think this is chicken. You think he's publicly showing Tesla shareholders, Hey guys, I got options. There's other things I can focus on. I got rockets, I got Starlink, I got AI, and if you don't give me 25% of this company and $56 billion cash, I'm doing other shit. It's probably part of it. And it's also just the risk. Elon's been, he has great vision in seeing where the tech world is going.

Right, like Tesla, SpaceX, who knows? Maybe even XAI are like really good bets on the future. The brain implants. Yeah, the brain implants. The holes underneath Las Vegas to send cars through. Yeah. Maybe not that, but you can't take it away from him. But eventually, and everyone was like, as long as he's involved,

it's going to be fine. But eventually, the bills are going to come due. And no one can possibly spend all this time on so many diffused bets on the future of technology and dedicate 100% of themselves to it. So he's stretched thin number one and the resources are stretched thin. And he has this kind of mode

where he'll just like toss everything toward a problem. And now that's going like, first of all, it's his first, it's his time. And now it's the resources. And I think that's a problem. Here's Carl Kinsley in a tweet, quoting Morgan Stanley's, I guess, Adam Jonas, without Elon Musk achieving a 25% voting stake in the company, we believe Tesla shareholders should be prepared

for Tesla to significantly slow down or curtail its direct investment in sensitive advanced AI efforts. So if you own Tesla for the AI, that's not good. Yeah, I think he knows exactly what he's doing. I think he's like, he's like, you guys are going to do this or I'm out of here. Here's my scorching hot take. I think he's gone, 50% chance he's gone, stepping down from Tesla leadership by year end.

It's because I don't think it's fun anymore. What puppet comes into that role? Dude, one of his cousins or something. But like, I mean, it'll be fine. I don't think there's as much intellectual stimulation being forced to build like economy cars. Like that's not what gets him excited. So now you have an auto manufacturer trading 64 times forward earnings in an industry that

trades five times forward earnings, heavily reliant on the whims of the Chinese government. The Shanghai facility is like really key to their profit outlook. He's got all these encumbrances as a public company and all the regulation that comes along with that. Now he's being forced into going further down market, make $25,000 rolling boxes to compete in a market that looks nothing like the Model S and the really cool shit that he started off building. It's just less sexy.

It's less daring. So I think the August 8th roboi announcement is like almost a Hail Mary. If that doesn't set the stock on fire again, I think he's going to be like, what do I need this for? Yeah, well, I mean, the full self-driving is a really good technological challenge for him that Tesla's actually making progress on him. Like the people that I've spoken with

that have tried this version 12 have been blown away by it, actually. But that's the August, and that's the August announcement. If people aren't excited about it, then... Yeah, well, yeah. I mean, if they're able to achieve that, then we're talking about a whole different discussion than the one we are now, because right now,

they're just a car company with AI promise. Here's my question to you. Let's say this does happen, and he does step down. Does Tesla stock go up or down? Up. Yeah, it's 2024, so up. I think it crashes. or down? Up. I mean, yeah, it's 2024. So up. I think it crashes. I'm with Eric. I think it crashes too. But he's still going to be a shareholder. He just doesn't have to be the CEO. How about this? Doesn't stay

flat. What about? I'm on that. I mean, where did they go? Like a hundred bucks at the end of 2022. And then, and he doesn't want the stock to crash though, because he's it's, I think it's the foundation of a lot of his other stuff Still he's borrowed against it. It's like I don't I don't think he would do something in such a way that crashes the stock out of spite Right. I just think you can't be the CEO of everything might not make sense to be the CEO of Tesla day to day It might make more sense for him to just be chairman and then focus on space Which is probably coming public next year. Right. But he has like a very strong number two in SpaceX and Gwen Chatwell.

So maybe he tries to find a really strong number two to run Tesla, but I do think like Tesla is still fairly expensive. So what's the odds of him saying I'm not the CEO anymore? I'd say plus three seven there. I'm making that up. What would you guys say? I'm saying coin flip. I I'd say plus three seven. They're making that up. What would you say? I'm saying coin flip. I think coin flip. I think there's a better chance. Even money?

Yeah. Hmm. I would go seventy five percent stays. Twenty five percent. It seems like a long shot. You think it's a long shot? I do. I mean, it's closer to that than a coin flip.

I think they have all this frigging data. It is intellectually stimulating for him. You still think it is. If this is an AI and robotics company, not a moving box company on wheels or whatever, then they've got all this data that nobody else has. So if you're going to do stuff with all these. It's not just a car company.

Come on, it's just not. Optimus is pretty cool. The robot that they built. It's a huge priority within Tesla. And I saw a video of it being able to like pick clothes out of a basket and fold them. Once again, if he owns 80% of XAI, I'm just making that up, but let's say directionally, and how much of Tesla does he own? 13?

Well, he wants 25. No, I know, but what is his... You know what he's down to. You know what I mean? There's nothing stopping him from saying, oh, actually, I think I'm going to do R&D on that over here. That's the danger to Tesla shareholders. Well, he's always been.

He's taken people who are key in Tesla and SpaceX and brought them into Twitter. Yeah. Oh, he's not above doing that. Absolutely. Is he the most powerful executive of the last 50 years? Is that crazy? I think so.

I mean, power over his own entities, 100%. Just influence. Owning Twitter definitely increases that level of power that he has. He's got the control over town square. He's got a leading car company, leading space company, cutting edge, neural government, government conjoining the infrastructure.

If Steve Jobs had kind of pulled this sort of stuff at Apple, I mean, arguably he could have been seen as more powerful because he could have said, hey, folks, I'm out of here if I don't get X, Y, and Z and stuff. He never went there. He was happy at Apple. I think what makes Elon a credible threat for doing all,

taking his baseball and bat and going home is that he's done weird stuff like he he went through the Twitter acquisition. He rescued Solar City because his family members were in it like he just decided oh Tesla's buying it. Nobody said shit like internally. Who could? Short sell is dead but that's about it. Yeah but I'm saying internally. He gives no f***s at all about anything. So that's the risk. And also does things sporadically and then thinks about them later.

Yeah. Which so far has worked out okay for him for the most part. There was a great moment in the Walter Isaacson biography of him where he goes, maybe I shouldn't have bought Twitter. Yeah. It's just like... $49 billion later. Amazon.

This is, if you ask me what I'm most bullish on in... of the Mag-7 as an investor, $29 billion later. like this is one that still could double. It's about 1.7 trillion dollar market cap right now. It sounds like you have the opposite view. From a technology perspective. I'm really, actually a culture perspective. I'm really eager to hear why you're bullish on Amazon because I'm probably missing something. And I also like tend to look at these companies, culture first, then products, and then money.

Okay. So I look at it as, I look at it as there is no consumer or business AI story without Amazon Web Services making a lot of money as a result. Right. They are, it's a hundred billion dollar run rate business. If it were a standalone company, it would be S&P 50,

I would guess on evaluation basis. And it's literally the linchpin S&P 50, I would guess on evaluation basis. It's literally the linchpin of what everybody's ambitions are in AI. If you want it to work, it's got to in some way be hosted here or be able to run here or be connected through AWS. That's the ultimate toll road through which a lot of this AI stuff is going to run. That's one thing too road through which a lot of this AI stuff's going to run. So that's one thing too. Jassy built AWS.

This is not like they did a talent search and they got a guy from Pepsi. Jassy was Jassy was there in 1997. Jass like Jassy was a Bezos's shadow. That was his first job. Come with me into meetings and then tell me what you think afterward. This is the guy. So people, people thought Apple was a short when Tim Cook took over. first job, come with me into meetings and then tell me what you think afterward. This is the guy. So people thought Apple was a short when Tim Cook took over.

Apple made, you made way more money as an Apple shareholder under Cook than you did under Jobs. And by the way, Satya built Azure for Microsoft. Yes. Yes. So Alex, no offense, nine billionaires just piled into Amazon stock last quarter. Let me give you a couple of names. Israel, Izzy Englinder, that's Millennium.

We don't know which team within Millennium, but that's 2.4 million shares. Andreas Halverson of Viking, 1.9 million. Chase Coleman, 1.4. Jeff Yass at Susquehanna. Ray Dalio, Dan Loeb, Ken Fisher, Ken Griffin, Philippe Lafont. These guys are all buying the stock at the same time and amassing big positions. I own 10 grand worth of it, not to brag. Michael, Michael, put them on the list.

So tell me now, tell me the counter about it being day two mode, because I haven't heard anything like that. I'm curious what what you're hearing. Yeah, and look, the financial story can be totally right about Amazon. Like, they do stand to, we've talked, I think, the last time about how they've taken this bring your own model approach. So whether you're running OpenAI or whether you're

running Llama 2 or Llama 3, like, you're going to be able to run it with AWS or Bedrock, right? And they're going to make money. They're going to need people to deploy through their systems. So I'm not disagreeing with that. Like, the billionaires, they're probably going to all make money. They're very good at doing that. So here's my perspective on Amazon in terms of direction. And it might take years for this to play out.

And this is like the concern I have is that, and we're going to do a bigger story on this, so I'm not going to give away all the reporting, but basically people within the company have said that it has a very like day two mentality right now. Meaning they're slowing down or they're maturing. Slowing big company, but also that the things that are going to get an investment within Amazon are the things that are making money right now. This sounds exactly like what I want as an investor. But the things that weren't making money right now, like in the earlier days of Amazon was

web services, right? Like they were the bookstore. And so they decided that they were going to take this sort of day one mentality, invest in what might be the future. So it might be nothing, but there's definitely like this feeling within Amazon that they're becoming more stodgy, more big company.

And they might be able to make a lot of money on it for a long time. But it does, I think, open themselves up to some sort of risk. They're not as daring. And then I don't think so. Not under Jassy. And maybe that's what the market is called for

and they've responded for sure. But I do wonder, like if you look at them next to Microsoft, I feel like I look at the, and AWS just had a really nice quarter, but you look at the Microsoft Azure numbers and their growth is like every quarter, like within the high 20, 30%, of course, off a lower base, but Amazon was like 16, 17. I think they had a, I mean, of course a higher base, but like they're growing more slowly

than the others and you're starting to see Google cloud come on and Google all of course, like they have their own AI play. I'm not, I'm not like ringing the bell and saying run away from Amazon. Obviously there's a lot of potential. I want buybacks. Yes. There's a rumor of a dividend coming, which it's amazing to think that Amazon

might be a dividend payer. There has historically been no reason to, because reinvesting that same money back into AWS has been a way better investment for them. But that's part of maturation, I guess. What are your thoughts, Amazon? I'm with you. I think these guys, actually, like when you sent the notes for the show, I hadn't looked,

I've owned Amazon off and on, but when I looked at kind of the same metrics of like forward multiples and all this kind of stuff, what surprised me the most about Amazon, I hadn't realized this before, was that I think they were the stock that peaked first. Yes. Post-COVID. So you know how Kathy's ARK fund peaked in February 2021, but then the MAG-7 didn't peak until November of 2021. Amazon peaked at a 70 forward PE in June of 2020. It was the ultimate stay at home stock. Yeah, for three months.

It went up enormously, but then it's been going almost straight down ever since. And at the moment, I think it's only a 30x forward PE. So I told that story earlier about Nvidia and how at the end of the year, last year, people thought, like, this thing is expensive because it's gone from $150 to almost 500 bucks. But from that forward multiple perspective, it was cheap.

And I think the same is true with Amazon because Amazon now I think over the last year plus it's gone from what 80 was the low to what is 180 now. So it looks like it's almost gone straight up. And it had done a 20 for one split. So had it not done that split this would be a four digit company. It's almost gone straight up. And it had done a 20 for one split. So had it not done that split, this would be a four digit company putting up

some of the best earnings growth they've ever put up. Right. So I presume these big guys, now they're looking for a big stock because they got big capital to put to work. So that's a consideration as well. But I assume that they're thinking is that this thing eventually it's going to re-rate higher.

It just can't stay. Maybe it, maybe it's not going back to, it's not going to 70x forward, but yeah, should it trade at 40x forward? You know. Maybe. They are becoming more profitable and I think like what you guys are talking about is spot-on and actually it is interesting to watch how the company has shifted from a retail company to an AWS company and you can see that even in the ranks. This is a bullsign for them, right? They're really all in on AWS now. You can see it in the ranks of the S team, which

is the senior leadership team that used to report to Bezos and now reports to Jassy. And up until recently, they were largely retail folks that were overrepresented there. That shifted completely. And Jassy has added multiple people from AWS into that team. And a lot of the retail folks have left. Last thing on Amazon, they're working on their own chips.

They have Inferentia, which is their inferencing chip and Tranium, which is their training chip. I would imagine that these are for use within their own bedrock AI environment. which is their inferencing chip and training them, Amazon's ability to build hardware and is that, is the anthropic Amazon combination an actual threat to Nvidia or to OpenAI or anybody else? So most companies that have been training these models are on Nvidia chips. They're very helpful for training.

The other side is actually when you use the models for inference or actually running applications. And whether it's Amazon or any other company that's trained on Nvidia chips, they do not want to keep relying on Nvidia to actually use it. It's even more expensive. The inferencing is even more expensive than the training, right? Correct. And so they're because you're you know you train once but you're constantly deploying to everything and they hate how much they've had to spend on Nvidia. So they're all looking for hedges whether whether it's Amazon, or Google, or whoever it is. And so this chip really helps them. Also, with inference, it's more of like solved math,

as opposed to like training, which is like experimental. So it's much easier to build on your own. So I think that, Josh, now that we're talking a little bit, OK, I'm coming around to your thesis. How many shares can I put you down for? I'll talk off the air. This be a joint account, or you want to open it individually? Don't go still. you down for? I'll talk F off the air. Would this be a joint account or you want to open an individual? Don't ghost.

You know what? We'll move everything. I want to exceed Batnik at least, so give me $12,000. Fair enough. Alex, you're making an excellent decision. Where can I send the confirms? You're home or your business? I'll be back next week.

But yeah, you're right. If they're going to take a piece of every little bit of AI that's being deployed and they have their own Chips this is all of a sudden you start to see the story come together You're gonna see you're gonna see some people out in Silicon Valley next week. You mentioned to us off air. Okay, so Who are you the most excited to talk to I know you're talking to every company Who are you the most excited to hear directly from? Anthropic I would say. I put Anthropic.

Let's do the Anthropic, not the Anthropic Amazon access. But Anthropic number one, I think that they're just brilliant thinkers about the direction of AI. And OpenAI might be the best at productizing this stuff. But I think Anthropic, whose leadership comes from OpenAI and we're responsible for some of the biggest breakthroughs, they have, I think, a vision of this software and this technology that's pretty special. leadership comes from OpenAI and we're responsible for some of the biggest breakthroughs. They have, I think, a vision of this software and this technology that's pretty special.

So I'm excited to go into there for the first time. And then I think that this is going to be my first time visiting Nvidia, and I'm going to be down there for a full day next Thursday. Where are they? They're in the South Bay. Okay. Are you going to wear a leather jacket? You bet. Are you going to wear a bra? That could be signed. If Jensen doesn't sign it, I'm never going back again.

All right, hey, we loved having you guys here so much. Thank you guys so much. Did you have fun on the show today? It was great. It was awesome. Absolutely, love hanging with you guys. All right, I want to end with favorites. I was gonna mention CZ being the richest person

ever to be put in jail. Michael says we could skip that. I just thought it was interesting. He's worth $36 billion and he's going to spend four months at a jail that has a farm attached to it, like growing lettuce. I love how you wrote it in the doc, farm jail. Yeah, farm jail. He's going to be milking horses at a farm jail in California. Compare that with the outcome SBF is living with,

and CZ obviously won, right? He's coming out to a $36 billion fortune. SBF might not be coming out. SBF returned value to shareholders, so. I'll go first for recommendations, being that, this is just a coincidence, but Alex, you're going to Silicon Valley. I am watching season one of the show.

And it is- Of the Silicon Valley show. I cannot believe how funny it is. I'm howling. It is so brilliant and so funny. And if you missed it the first time around, I cannot recommend it highly enough. It's so brilliant.

My judge might be the greatest satirist of the like, the last hundred years. It's unbelievable. I couldn't watch it when I lived out there. It was just way too close to home. But it might be, you know, it might be worth a rewatch now, especially with my wife who's like new to the US and like... Dude, and you still have the best ahead of you.

Like, like Jin Wang doesn't even show up. I'm probably not going to make... I'm probably going to stop at the end of the season when I'm guessing. But it's just... It's so funny. What about uh, uh, Ross Hanneman doesn't even show up till like season three. Like the best is still ahead of you. So, all right.

Super jealous. I should start that. Uh, Eric, what do you got for us? Uh, I thought the Chamath podcast last week on the all in podcast was pretty interesting because he talked about, um, crypto and he, he always talks on those things that we go, I had a guy at my shop do a little research on XYZ. I thought all the guys at the shop were gone.

So he had, he found a guy who did a... Shout out to Jamoth. Michael's just kidding. No, I'm not. Seriously. There have been four Bitcoin halvings now. We just had one back in April. Yeah, I got a tattoo for that one. now. We just had one back in April. They found that within the 18 months after each having, the Bitcoin goes crazy. So the first time was up 44x. The problem is if everyone knew that going into the fourth, how much of that was pulled forward. Right. So I mean, did it hit 70,000 just now? Yes. It did, right? I think 71. 71. 71,000?

Yeah. So anyway, the bump is going down. His argument is that after each time this happens, what leads to the increase in prices, because so many more people outside the US see it as sort of like a store of value for keeping their wealth in there. And so they get attracted to like basically as an alternative to gold.

Do you own crypto or you just own Coinbase? Just the equities and then the ETFs and stuff for the asset itself. And so last time it happened that, you know, was up 8X, is it going to go up 8X again? No. In an 18 months, probably not. Is it going to go up 4X? 8X from 70,000?

Right. What would that, I'm not great at math, what would that be? Well, I mean, Chamas prediction is $500,000 within the next 18 months. So, 18 months, geez. I've learned enough to stop fighting against people's price predictions

because one by one, they've all come true. So I don't say anything. So anyway, it's interesting. What's your price target? Shout to all in. Bitcoin? A million. A million a coin. A million a coin?

What's your favorite this week? Alright, I have one that I've been playing around with. Has anyone... Have you guys tried these? These are the Rayman Metas. Oh shit! Has anyone talked about this on the show yet? I had them on my head. Has anyone, have you guys tried these? These are the Ray-Ban Metas. Oh, shit. Has anyone talked about this on the show yet? Yes. I had them on my head.

How are they? They are awesome. I think they're cool. So let's see, I'm going to put them on. And these lenses right here, so for listeners, it's a pair of glasses. Lenses are see-through, no prescription. You can get prescription in them.

I tap the side of it. It connects to my phone, play Spotify, or plays a podcast. Wear it on the train, no problem. You can listen to the show. The, it connects to my phone, plays Spotify or plays a podcast. Wear it on the train, no problem. You can listen to the show. The speaker is closer to your ear on the arm. Exactly. Do they turn into sunglasses as well or is that a sign? Yeah, so when you're outside, I think the sun, they react to the sun, they become sunglasses.

And the super cool thing that I like a lot is that you can hold down this button. I don't think it's working. I think the batteries are out. And it takes a video. So you could take a video and it's going from your point of view. So I was up on the. It's like Mission Impossible.

How do you charge it? There's a, in a Ray-Ban's case, it charges in the case. So I was up on a rock climbing wall and I was like, all right, I'm going to wear these. So like you see from point of view, like as you're picking the route and just like clipping in and falling, from like the way that you would see it.

It's pretty cool. And like, I'm gonna go on vacation in August, I can't wait to wear it. Cause like, instead of having to take your phone out and take photos, you're just like gonna click. That's really cool. I think a year from now, I think a year from now,

you'll be able to like go into Yankee Stadium and instructed to tell you if you know anyone there and so scan oh yes oh wow I know recognize your friends accounts on whatever devices they're on and like snaps yeah that's so cool so there's gonna happen there's AI in it so you can say hey meta what am I like look at this and tell me what it is how tall is it in front of me how many feet high is it or even like if you're like in the middle you want to pull your phone out what what time is it? Tell you the time.

Yeah, no, I like it. My friend Gwyn was walking around with those at the New York Stock Exchange. And I tried it on, I thought it was pretty cool. I got two, I saw Furiosa, I saw the Mad Max. How was it? I loved it. But I would have loved it no matter what,

whether it's good or bad. I don't think I'm objective. You went to the theater? I went to the theater, empty theater. Yeah, of course. Saw it in the big screen format. I don't think I'm objective. You went to the theater? I went to the theater, empty theater. Yeah, of course. Saw it in the big screen format. I can't wait to see that. The movie just beats the shit out of you.

When you walk out of the theater, you just feel like you've been through something. It's just absolutely relentless. It's pretty cool to see George Miller, who started making these movies almost 50 years ago, becoming more intense as a filmmaker, not less. Right.

This film does not let you breathe. So more intense than Fury Road? Oh, yeah. Yeah. You cannot breathe watching this movie. This may be two scenes where someone's not getting their throat cut. And I just, I absolutely loved it. What rap album?

Uh, no, Eminem's video for Houdini is hilarious. So if you want to have like a time warp experience and feel like you're 25 again put on go on YouTube It's Eminem making fun of his younger self. He's in the Robin costume again Jray's in the video snoops in the video 50 cents in the video The song's okay. He samples a Steve Miller band Abra Kadabra It's like an okay. He samples a Steve Miller band, Abra Kadabra. It's like an okay song. No one's gonna remember it a year from now, but the video is a lot of fun.

And it looks like he's just making fun of himself at this point, and he's having a blast. So he's not like serious Eminem, at least not in the first track. So highly recommend. All right, that's it from me. This was an extra long show, but worth it. We had two incredible guests. Eric, where can people find more of your stuff? Where do you want

them to follow you? You can X, Instagram, Tik Tok, Eric Jackson, or Eric M Jackson, whatever. All the things. And Alex, you are exclusively found on Anthropic. Yeah, that's right. I'm actually the embodiment of Claude. I want everyone to subscribe to Big Technology. Tell'm actually the embodiment of Claude. I want, you are. I want everyone to subscribe to Big Technology. Tell them where they can go to do that. Yes, so Big Technology podcast

and your podcast app of choice is the best way to do it. I'm going to be- On the Substack? Substack, yeah, bigtechnology.com. But yeah, I'm going to be out on the West Coast. So I'll have a day of reaction to WWDC. Love it. Wednesday show and then a Friday show

all about what's going on out there. We will be listening for sure. Alright, great job this week. John, Duncan, Rob, Dan, Sean, so many people to thank. Matt, Nicole, thank you guys for listening. See you soon. Thanks guys. Dude, that was awesome. So fun. Holy shit. We got a lot in there. That was dense.