The Prof G Pod with Scott Galloway - Prof G Markets: The GOP Tax Bill, United Health’s Terrible Week, & Chinese Tech Earnings

Episode Date: May 19, 2025

Follow the Prof G Markets feed: Apple Podcasts Spotify  Scott and Ed discuss why United Health’s stock hit a five year low, Warner Bros. Discovery's latest move to rebrand Max, and Airbnb’s foray into offering bookable services for travelers. They then break down earnings from Alibaba and Tencent, highlighting how the results signal the growing momentum of AI in China — and why they're feeling bullish on the country's tech sector. Finally, they dissect the GOP’s proposed tax bill, explaining how it overwhelmingly favors the wealthiest Americans and threatens to accelerate wealth concentration across the country. Subscribe to the Prof G Markets newsletter  Order "The Algebra of Wealth," out now Subscribe to No Mercy / No Malice Follow the podcast across socials @profgpod: Instagram Threads X Reddit Follow Scott on InstagramFollow Ed on Instagram and X Learn more about your ad choices. Visit podcastchoices.com/adchoices

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Public Mobile, different is calling. It's hockey season, and you can get anything you need delivered with Uber Eats. Well, almost, almost anything. So no, you can't get a nice rank on Uber Eats. But iced tea, ice cream, or just plain old ice? Yes, we deliver those. Goaltenders, no. But chicken tenders, yes. Because those are groceries Yes, we deliver those. Gull tenders, no. But chicken tenders,

yes. Because those are groceries and we deliver those too. Along with your favorite restaurant food, alcohol and other everyday essentials. Order Uber Eats now. For alcohol, you must be legal drinking age. Please enjoy responsibly. Product availability varies by region. See app for details. What's up y'all? It's Kenny Beach and we are currently watching the best playoff basketball since, since I can't even remember when. This is what we've been waiting for all season long. And on my show Small Ball, I'll be breaking down the series matchups, major performances,

in-game coaching decisions and game strategy and so much more for the most exciting time of the NBA calendar. New episodes through the playoffs available on YouTube and wherever you get your podcasts. Subscribe to Small Ball with Kenny Beach so you don't miss a thing. Today's number one. This week is the one year anniversary of the ProfG Markets feed. Speaking of Baby Zed, when someone hands me their baby, you know what I say? Sorry, I'm a vegetarian. Weird joke and we weren't speaking about baby, or I guess one year anniversary. All right, put it together.

Ed, what sexual position guarantees the ugliest baby? What? Ask your father. Ask your father, Ed. Ask your father. That's good. How are you, Ed? Happy anniversary. I like that.

Yeah. Happy anniversary. What kind of emotions does this bring up for you? We've been doing this for a year now. At least we've been doing this dedicated podcast for a year. It's just exceptionally rewarding to watch your growth and the growth of the team and. I'm so used to virtue signaling. I can't even, I can't even like, I'm so used to being full of shit.

By the way, the FT is doing it. The FT is no joke doing a profile. Let's get back to me. The FT is doing a profile on me and they can't. The FT really likes us. They let me write an article for them a few weeks ago. Did they really? Oh, and by the way, so anyway, back to me.

Who the fuck cares about you? Stop acting like me and turning it back to you. Yeah, I don't like it. Something came over me, I don't know what happened. The FT is doing a profile on me. And they came over and they were like taking photos and all this stuff. So I feel like that is literally the closest

to British royalty I will ever get. The FT is doing a profile on me. I'm gonna be one of these guys that spends a billion, something like half the lords in the nights are billionaires. Yeah, but it's not a pay for play thing, don't think that. But I figure things are cheaper here, so I'm wondering if two or three million bucks, I can be one of these honorary princes that gets.

100%. That gets a title. So I wanna be some sort of Lord or Prince of Wales, and I'm gonna change my name to Shamu, and I'll be Shamu, Prince of Wales. Ah. That's worth a few million dollars. I think you could easily get knighted.

Just throw your money around, become friends with the right people. That's certainly in your future. I told you they, right when I moved there, they invited me to 11 Downing Street. Hold on, hold on, hold on. Scott. Yeah. It's 10 Downing Street. 10 Downing, 11 Downing? Oh, maybe that's why they didn't invite me back. It's 10 Downing? Thank you. Thank you. It's good to have some local knowledge. Anyways, the, so I went down went down, first time I went down, they didn't have me on the guest list, thought I was so important, went down,

they're like, and the woman called me, oh, I'm so sorry, we forgot you were coming in, went in, and they wanted to put me on the governing body for UK football. Really? Yeah, I thought, I know nothing about football, but it sounds like a shit ton of fun, and I get to go to games.

Oh my God, you didn't tell me that,. Oh, yeah first they wanted me on the it's called the OFC the office of communications where you'd regulate I don't know you regulate on Facebook and all that shit. I'm like, oh my god, that sounds awful and They're like well, we're putting together governing body for UK for for the Premier League and I'm like I am so in I'll be hated The American making bad decisions around UK at the sports last time. Yeah, the Todd Bowley of governance would be good. I know this is gonna come as a shock,

but they haven't called me back. So I think this part has something to do with it. You didn't look the part, I guess. I'm not in the British government. Let's talk about us one year. One year, what are your reflections on the incredible opportunity afforded you? It's been a very good year.

I've been sort of been a transformative year for me. One thing I was thinking, we're coming up on four years of me working for you. I started working for you in June, 2021. And that to me is really shocking. That feels like a really long time that I've been working for you. Not sure how it feels for you.

Yeah, it's shocking. I thought you were frozen. I'm dazed. I stopped talking because I thought you were frozen. Your face was so still, zero reaction or emotion. I'm thinking clear and have migraines. That was definitely shocking. That's a long time, no? It feels like a long time for me.

It has been a while. It's been your, this has been your only shocking. That's a long time, no? It feels like a long time for me. It has been a while. It's been your, this has been your only job since you got out of college, right? Yep. Now it's amazing how fast it's gone. So he came to work with a, I again, loved the story about Joanna Coles calling me and saying, I have a gift for you. I'm like, oh, great. And she's like, Ed Elson. And I'm like, yeah. Remember the name. She's like, he's my son's best friend

and you have to hire him tomorrow. You're welcome. And I'm like, well, what role does it, doesn't matter. It doesn't matter. She literally bullied me into hiring you. Anyways. And it panned out. Prop G Markets is now,

it's our fastest growing pod in the pod willing franchise, which is the LLC I just invented to put all this shit in so I could engage in massive tax evasion. I mean, just bring some synergies together around the back end and the infrastructure. And because our average age is 34, to reach as many 34-year-old males on CNBC, you'd have to watch CNBC until 2088 to reach as many young men. By the way, as you recognize,

I had my very first TV appearance last week. You were fantastic. They got your name wrong on the Chiron. That's the first thing I noted. They called me Ed Olson. And I said, you know what, who cares? I'm like, wow, this Ed Olsen guy looks a lot like Ed Olsen. You were outstanding.

You were measured. Thank you. They had all these, you know, the average age. By the way, I love Katie Tuer. Right out of Central Casting to be a great host. A great host for seven-year-old men to be like, oh, where's Katie. Where's that young whippersnapper Katie?

Where's my oxygen tank? One year, one year. You're just imitating yourself at this point. Ugh, I got this new brand of edibles and it's working. It's working. I did it last night and I called a friend out and talked to her about three years and she went, are you all right?

I could not stop talking. I could not stop talking. This is fun, but we should really, we should really get to the show, right? That's my line. I'm sorry. Just tell me a little bit more about your parents on MSNBC. Uh, very... Okay, that's enough.

Let's get to the headlines. Hit it. Actually, before that, I have to make one announcement and this is a big announcement and that is that ProfG Markets is going to air on the Prof G pod feed. That's the main feed where you see Scott's face with the turquoise for the final time on June 9th. And after that, this show is going to be exclusively on the Prof G markets feed. That's the feed.

If you type in Prof G markets, it's the green, it's got me and Scott hanging out in a living room. And we're going to be publishing this show every single day of the week. We're going daily. So Monday through Friday, you can get your fix for ProfG Markets. It'll be the most up-to-date coverage of the markets from the ProfG team. So I would encourage you, if you're listening on the main podcast feed, the ProfG pod, take the opportunity now, go follow the ProfG Markets feed.

Wherever you get your podcasts. That's where you're going to be getting this show and you're going to be hearing it every single day because who wouldn't want more of us, right? All I gotta say is it's we're doing this because it's rewarding and we're CNBC. We're coming for your bitch ass. That's right. And we're taking Josh Brown with us. Your star talent.

We're taking him with us. Oh, we love Josh Brown. All right, let's start with the weekly review of Market Vitals. The S&P 500 rallied on news of US-China negotiations. The dollar jumped before giving up those gains as optimism faded, Bitcoin fell, and the yield on 10-year treasuries increased.

Shifting to the headlines. United Health Group had a terrible week. The US dollar was down by a quarter. The US dollar was down by a quarter. The US dollar was down by a quarter. up those gains as optimism faded, Bitcoin fell and the yield on 10-year Treasuries increased. Shifting to the headlines. United Health Group had a terrible week, first dropping as much as 18% after the company pulled its guidance and announced its CEO is stepping down. Two days later, the stock fell 17% on news that the Justice Department is investigating the company for Medicare fraud. At the time of this recording, shares are at a five-year low. Warner Brothers Discovery announced it's bringing back the HBO Max name for its streaming platform. The change will take effect this summer. It will

reverse the rebrand they introduced just two years ago, and this marks the platform's fifth name change in just five years. And finally, Airbnb is expanding its offerings by allowing travelers to book services such as spa treatments and personal training right at their rental. The company is also reimagining Airbnb experiences by placing a grade to focus on authentic locally led activities. Ok UnitedHealth, crazy dramatic month for this company. First mean, first they had that bad earnings report in April, and that was their first miss since 2008. They cut guidance, the stock fell 20%.

Then last week, the CEO steps down, they pull their guidance, the stock falls another 18%. Then Wall Street Journal two days later reports they're being investigated for Medicare fraud down another 17% so we're now looking at in just one month a 57% Destruction in value for what was one of the top 15 most valuable companies in the world So I think if anyone's wondering like why is the stock falling so much?

It's a combination of there are real issues that the company is dealing with, but also these were all surprises. Like the CEO stepping down, that was a surprise. The suspension of the guidance, an even bigger surprise. And then the kicker, of course, is this Medicare fraud investigation. And as we've discussed, Wall Street hates surprises. But I think the other side of this that is worth thinking about, United Health is kind of a bellwether for the healthcare industry. So when it goes up, so do the other healthcare stocks. When it goes down, so do the other healthcare stocks.

And that's what we saw here, where CVS dropped, Elevance dropped, Humana dropped, lots of other healthcare stocks fell with it. And so I think the question people are asking now is, are the problems that this company is facing, are they specific to the company or are they industry-wide? And the market appears to believe they're somewhat industry-wide. That's why you're seeing the devaluations in these other stocks. And I think that probably has to do with what we're seeing in politics. You know, we're seeing talks about lowering drug prices, increasing price transparency, giving Medicare more negotiating power, all these things that would be great for consumers,

as we've talked about, but that would, you know, hurt the healthcare industry, hurt the bottom line. My view is if history is any guide, healthcare investors have nothing to worry about. Because what history would tell you is that lobbying ultimately wins. And who is the greatest lobbyist in America? It's the healthcare industry. $300 million on lobbying last year, more than any other sector, more than double what oil and gas spend. Never underestimate the power of lobbying and what it can do for your stock price.

So I look at what's happening with UnitedHealth. I see this as a company-specific problem. They're dealing with internal issues. They have the PR crisis with the shooting of the CEO a few months ago. They're also uniquely exposed to Medicare and these higher costs that are coming with it. So to me, this is a United Health problem, not a healthcare problem. Oh, a lot there. I agree with you. And I hate to say this, this is probably a buying opportunity.

For this stock to get cut in half, it's probably because to your point, there's so much regulatory capture. I mean, these are American companies donating money to American politicians such that they can implement laws such that we have to pay more for drugs that were invented and manufactured here than they pay in Mexico or Canada, such that these American companies and their CEOs and their shareholders can get rich

through incremental price gouging of American households, where we have ended up with 40% of American households have some sort of medical or dental debt. And in America, we pay $13,000 per capita per consumer for our healthcare. The UK, Canada, Australia, all the other G6 nations average around $6,500. So we're paying $6,500 more per person, and we're more obese and die earlier and have more diabetes and more anxiety and depression. So we pay double for a product that is worse. If you were to figure out a way to bring those costs in line with the rest of the G6 who have better outcomes, outcomes. 355 million people times $6,500, I think is somewhere around 2.2 or 2.4 trillion dollars. And those costs flow through our entitlements and drive up the cost of government. In addition,

the amount of money and misery that people who have to work too hard, people who can't go to work because they're unhealthy, all of this bullshit around make America healthy again, it's nothing but a distraction to talk about dyes and vaccines is a distraction from the real problems of the thing that is hurting America's income inequality. If you really wanted to make America healthier again, raise minimum wage to 25 bucks an hour. You know, there are just too many people who are obese

and the reason they're obese is because they work so damn hard, they don't have time to get to the gym and they don't have enough money so they have to stuff themselves with the cheapest form of calories, which is fast food. But we don't want to have those difficult conversations. So we have to go after healthcare. And the only way you're going to go after healthcare is through figuring out Citizens United and getting lobbyists out of the picture here

because they are literally raping and molesting the US consumer and creating 40% of America has dental or medical debt. Can you imagine the tax that puts on people's psyche and their levels of just prosperity and wellbeing and mental wellness? And then you come back, I think what's happened is, I think people are so pissed off at these companies

that anytime someone in the DOJ or the FTC or whoever raises their hand and says, should we investigate these guys? I think they're very inclined to investigate these guys. I think they are pissed off at these companies. So there's two ways to look at it. Is this the chickens coming home to roost? Or is this just a temporary blip

where the Americans will move on to something else and the lobbyists will figure out a way to continue to charge Americans double what they pay anywhere else in the world for worse health outcomes such that their shareholders and the management of these companies can continue to soak America. And the story that brings it all home for me, I read the most heartbreaking story.

So the New York Times has this section called recent weddings. Have you seen it? And it's just this lovely section where they have a nice picture of two people in Central Park and it talks about their nuptials. So they bended the rules for the first time and they did a wedding announcement of a young woman and a man, and did the whole full write-up and she was in her

gown and they weren't getting married. And the reason they made an exception is this woman has a glioblastoma, she has an incurable brain cancer, right? And she's decided that they're going to get married. They're going to have the ceremony, but they're not going to get legally married because she's worried he would inherit her medical debt.

And I mean, you hear this shit and you're just like, Jesus Christ, this is the most prosperous nation in the world. And we're letting that, like that kind of misery on people. Anyways, that brings home, the American healthcare system is not only making us sicker physically, it is leaving so much strain and pressure on people. And I just love that these companies

are getting kicked in the nuts. But again, it's just, it's company. And this is sort of my point. It's like UnitedHealth has its own set of problems that they're dealing with. One of them being one of the executives of their company got murdered. Plus the fact that their business is very much tied to Medicare. What they're dealing with right now is that there are all these old people who didn't get these treatments that they were thinking of getting during COVID.

And suddenly they all come now and they need knee replacements and hip replacements, et cetera. And this is a problem for UnitedHealth because now they have to actually pay for those treatments. Before they were barely paying for treatments and then still collecting all the insurance. So that's a UnitedHealth specific problem. And now you have this investigation. But I think the things that you get out there are important. And I think the question is, how do you fix it? And the only way you really fix it right now, it's about getting the cost of drugs down. And the most obvious way you do that is you increase price transparency and you create

laws that force these companies and these PBMs to publish what the price is. You wrote a really good, your No Mercy This Week is really good, I read it, and you cite this presentation by this guy, Brian Lawrence, where he basically says that health insurance today it's akin to using auto insurance to buy gasoline. It doesn't make any sense that we don't even know what we're paying for when we sign up for these treatments until after the fact, and we can never figure out what these medical bills are.

So we need more price transparency, which by the way, Biden worked on, and actually Trump worked on a little bit too, but we haven't really seen that comment come to any fruition. And then we need Medicare to be able to have the ability to negotiate on prices, which is what every other country has and we don't have it for some reason. Again, Biden changed that in the Inflation Reduction Act, but we still haven't seen really any reduction in the price of drugs, I think because it hasn't been properly enforced. And the last thing I will say,

I looked back at our conversation with Jonathan Cantor, who's the previous head of the antitrust division of the DOJ, and we asked him the question, what is the one industry that most needs regulation and increased regulatory enforcement, specifically from an antitrust perspective. And his number one answer was healthcare. You talk about Medicare, for example. There have been studies by the Wall Street Journal and reports about massive billions upon billions of dollars in overcharging due to things called up coding, which is when

an insurance company goes in, they take someone on Medicare, make them look really sick, and then they get to bill for all that, but then they don't necessarily reimburse for all that, and they keep the money in between. These are the kinds of areas you would focus if you were actually trying to make government less expensive and more efficient. He talked about a company like United Health is placing itself on both sides of the trade in a lot of cases where they're offering the insurance, but then they're also a pharmacy benefit manager at the same time.

So they're sort of buying and selling from its own, from itself. But I think it was really interesting that he said that. from itself, but I think it was really interesting that he said that, and I hope that what we will see is some increase in regulating this industry. But again, I don't see this as totally structural yet, because I still look at the money in lobbying, and the fact that it's $300 million last year that was spent on healthcare lobbying.

I just am not that optimistic at a structural level. So I think over time, the only way to really do that, I think, and I hate to say it because I always have this gag reflex, well, I'm not a man, I'm not a macho, I'm not capitalist. If I recommend socialized medicine, for God's sakes, we need socialized medicine. Yeah.

The only way to solve the deficit, in my opinion, is to socialize medicine, and the only way we do that is to figure out a series of executive actions or some sort of legislation or the right Supreme Court justices to overturn Citizens United because money has just, I mean, the greatest investment, return on investment in our economy is when these healthcare companies give money to politicians. I would encourage everyone to go look at Senate Bill 3548, which was supposed to address all of this.

And it was actually backed by both sides. And you look at what happened, it was proposed, and now suddenly it's just dead. And you try to ask the question, what happened to the bill? And everyone says, oh, it just sort of didn't get reviewed and it just got kind of held up in Congress and so now it's dead. It's unbelievable how you just see this happen, how the money in politics actually does just grind these things to a halt. And then you don't really know it because it's such a soft and unceremonious death.

Like you sort of forget about the issue. But go look up that bill because that addresses everything we're talking about, price negotiations, price transparency. And I just sort of flopped in Congress. Let's move on. Very different vibe. HBO is doing another rebrand. Their fifth rebrand in five years. We had HBO Go, then HBO Now, then HBO Max, then Max,

and we are back to HBO Max. Scott, our producer Claire, has a clip that she wants to play where I'm gonna look very foolish. HBO Max, this will go down in history as a first ballot hall of fame, head up your ass brand strategy move. There's something in brand strategy. We spend two sessions in my brand strategy course at NYU

called brand architecture. HBO, a brand is a series of intangible associations that result in a rational trial or margin. You could have infinite capital and you couldn't build a brand like HBO in two, three, five, maybe even 10 years. And they're taking that brand and emulating it so they can call it Max? I mean, this is just an outrage, Ash. I actually like this rebrand.

I said I liked it on Twitter. I said I just think it sounds cleaner. And I got a lot of pushback, a lot of unfollows, interestingly. But the way I see it, there are all of these other production companies, they have to now transition getting the Discovery Plus content onto the Max platform. Don't you think that Max is just kind of cleaner?

Well, first off, let's nod to your logic and let's change the name of your educational institution to Prince because it's cleaner, Ed. It's cleaner. Take it away. Wow. This is my one year. This is my birthday. You admitting you were wrong and I was right. That doesn't happen very often here. HBO has developed such, it is the artisanal brand. It is the Hermes, it is the Ferrari, it is, you know, it is the Beverly Hills Hotel of hotels.

It just, it is the premier artisanal brand in media. And their ability to attract the best talent, and they've been able to maintain this culture that attracts the best talent, has resulted in a streaming network that is, if there's people talking about a Zeitgeist cultural moment, it's usually because of a show on HBO, whether it's Succession, whether it's The Last of Us,

I mean, or Game of Thrones, or The Sopranos. Or The White Lotus featuring Scott Galloway. Thank you very much. You're welcome. They have figured out a way to capture lightning in a bottle more often than any other firm on $2.5 billion in content budget versus Netflix at $18 billion.

To take that brand and fuck with it like this shows that you are a terrible fiduciary for shareholder value. It means no one on the board, a board kind of has three jobs. One, if and when to sell the company, two, hiring and firing the CEO, make sure you have the right guy or gal.

But also three, you should have some domain expertise on the board such that you can save the CEO from him or herself. You can occasionally weigh in and go, you may want to think this through, or they call on you if you have a really good relationship. They call you and say, what are your thoughts around this? The fact that they did five brand changes in five years and they decided to do away with what is one of the greatest brands in the history of media shows there is no one on the board that has any sense of marketing or branding.

What is even worse about all of this is that this is probably the worst board in media. Warner Brothers, Discovery, since the merger, the stock is down 62%. All right, that's bad. They faced a lot of headwinds. Despite shareholders losing almost two thirds of their value, 62%. All right. That's bad. They faced a lot of headwinds despite shareholders losing almost two thirds of their value.

The board has decided to pay their CEO, David Zaslav, $387 million over the last four and a half years. So shareholders, you give us a dollar. We'll give you back, we'll give you back 38 cents, but we're going to give our CEO, who oversaw this destruction in shareholder value, a third of a billion dollars. This is an absolute destruction in shareholder value. It shows that the people who, some of the most creative people in the world can't save themselves from themselves. And I will say this, a step back from the wrong direction

is a step in the right direction. So good for them. They probably realized they really needed HBO. I'm triggered by this because HBO has literally garnered some, in my opinion, has inspired some of the most incredible moments in creative history. When John Snow and Ygritte, when Ygritte comes to her end in Game of Thrones, I think there's some incredible love stories in there. Plus, Game of Thrones, hands down, everyone always said, what about a porno if it was a really good story with high production values?

Congratulations, that's called game of Thrones. My son, true story, my son did not refuse to have the sex talk with me. I'd said, okay, it's time for your sex talk. He screamed out no and started running from me. He literally just refused to have the time. So, okay, we don't have to have this talk, but you're watching game of Thrones with me for eight seasons. That's basically sex education for any 15 or 16 year old. And it stalls with a scene where you have sex

with your sister, right? Oh, that's right. Not the greatest education. Yeah, but if there's one message from Game of Thrones, if there's one moral, it's that family comes first. That's good. That's good. One of your first relevant sex jokes, I love it.

What's your favorite HBO series? I love Lost of Us. Um, I... Yeah, I watched season one. I thought it was great. I'm watching season two. But I'm not a huge TV consumption guy, and that's part of the issue, I think, why I was wrong about all of this, is that I don't... the HBO brand doesn't resonate for me

in the way it does for you, because I'm less of a TV guy, which is why I shouldn't really be weighing in on what HBO Max should be doing in terms of branding, because I'm not really the target consumer. But what is striking to me is it just sort of reverses all of the intention behind the merger in the first place, where the idea was we're gonna merge with Discovery, take all of the Discovery product offering

and all the Discovery IP, and we're gonna kind of try to blend it together. And the way we'll do that is by calling it all Max. And this is basically them admitting, wait, all the shows on Discovery suck. They're kind of cheap, shitty shows. Meanwhile, we have all the shows on HBO, which are beloved and high quality,

and are sort of the luxury brand of streaming media. We shouldn't really be meshing or merging these two together. So let's sort of walk things back and go back to the HBO Max brand. And the fact that the architects of Max, the fact they're giving up on the name, I think it shows that that you are right and that the importance here is that you maintain the

brand positioning that you built up for years in HBO. Let's move on to Airbnb. Yeah. So Airbnb is getting into services and experiences. This is sort of a complete revamp of the app. It was a place where you book vacation rentals. Now it's much more. You can book chefs and tour guides and personal trainers.

Basically anything that you'd be offered at a nice hotel, you can now get on Airbnb. Brian Chesky, the CEO, is calling it Airbnb for everything. People are calling it Airbnb's attempt to become the everything app. The stock rose almost 3%. You give us the analysis here. What do you think of this move? I would imagine they have figured out

that there's a target market of pretty wealthy consumers with a lot of disposable income, specifically corporate travelers who like the amenities of hotels. And so they're starting to add them. I think it's a great idea, but it's high margin revenue. I talked to Brian on a semi-regular basis and brainstorm. This was not my idea. The idea I had for Brian is if you're in Munich and you're, say you're 29 and

you're working for Salesforce and you're on London sales team and you're in Munich meeting with, I don't know, BMW or whoever, you can turn on a switch that says you're visible and there's groups or coordinators almost like a Reddit page manager that says we're all meeting at the Hofbra House tonight and everyone's welcome.

Because what I found when I was your age Ed, and you don't do as much business travel as I did, when I was your age, it was literally or the molesting the earth trying to sell brand strategy services. I would find myself in an amazing city, at staying at an amazing hotel with a little bit of money, and I had nothing to do. And I sure I could walk around the city on my own, but I would have loved to have gotten together with a like-minded group of people. And Airbnb, I think it's a really nice community. The people, you know, my sense of people

who engage in Airbnb are professionals, they're culturally interesting people in their 20s and 30s. That's my sense of the populace. I don't know if that's true. Oh, that's right. But to give them another reason, or to create an added feature

where when I travel with Airbnb, I get stitched into this really cool community of people where I can make friends, find professional contacts. I mean, that's what you should be doing, create a community. My question, that sounds nice, and I agree it would be nice for society. How does it make money? I think it's just another feature.

I don't think it's a money-making thing. I think what, or what you could do is turn it into Airbnb Plus, and it creates the ability to go visible and you charge. I mean, if you want, I didn't see this as a moneymaker. I saw it as another feature that creates a more sticky brand where people go. I always go it. What it does also is it takes advantage of their scale.

Cause I've had at any given time there's four, seven, 1100 people staying in Berlin that night at an Airbnb and no one else can do that. Anyways, that was, that was my idea, but he didn't do it. That's why he's a billionaire and I'm here stuck with you celebrating our one year anniversary. You want friends, I want money. So I'm thinking about how does this company make money? They've kind of maxed out on growth at the moment.

Like they created this category sort of, which is vacation rentals. They conquered that category. They executed practically to perfection, but the growth of that business is slowing. And if they want to be a $100, $200, $300 billion company, which I think is what he wants, then they need to go after new businesses. And so their answer to that question here is we're just going to go after all services. You were saying it feels more like a sort of they're trying to become a hotel. The vibe I was getting, and by the way, I actually prefer that as a strategy.

The vibe I'm getting from, from Brian Chesky and from the announcement is he wants it to be just Airbnb for everything. It's almost like Craigslist meets Uber. If, if you have any sort of service that you can provide, you just sort of rent out your service on Airbnb. I think it's almost too ambitious. Instead of going after one additional category, they're going after like 15 to 20 at the same time. But at the same time, it's like, I respect the ambition. And it shows me that they wanna be bigger than they actually are right now.

It shows me that they're thinking big picture. And I think the market sees it that way too. And that's why you saw the increase in the stock. I don't think it will work, but I don't really have a problem with that because they're trying things out. And if it doesn't work, they can just pivot. I think a lot of hotels live and die

by this ancillary revenue. And that is, when I say the hotel, I bet I spend probably 50, say the hotel costs a thousand bucks a night, I bet I spend another four or $500 on food services and stuff. Is it that much? Maybe, I don't know, maybe not that much, but hotels,

30% of the revenue comes from ancillary and I bet at high-end hotels, it's more than that. And by the way, that story that you're telling me there, I actually think is more compelling than the story that I was hearing from Brian Chesky, which is it's just trying to be, offer hotel services. But the story Brian Chesky is telling is, we're gonna offer all services.

We'll start here with like, we'll give you like, a tour guide will come and take you to the Eiffel Tower, but ultimately we wanna do everything. And that's the story I don't buy as much. Your story, you're telling me, I'm totally with you. Yeah, for me, I would start, I would just say, okay, are you looking to cook dinner? We have a service where we have a chef

or we have someone just get your groceries. Tell us what you want, we get your groceries, right? Do you want us to make restaurant reservations for you? Actually, we should bring in, I think Claire and Mia did one of these services when they were at an Airbnb. Claire, do you want to tell us about it? Yeah, Mia and I were in Mexico City a few years back and we did a tour of the temples

right outside of Mexico City with this local guy who lived nearby. He also had a home where he was making chocolate, so he took us over to show us how he makes chocolate. We got to meet a bunch of other tourists who were there kind of doing the same thing, just checking out the city for the first time. And then he took us underground into this cave. It was a very kind of magical, unexpected experience. And it was nice because we actually got to interact with other people, even though

we were kind of traveling solo. I'm in awe of the fact that you are literally a different species. If someone said to me, you have to go with a strange man to his apartment and see how he makes chocolates, and then he's going to take you to a cave, but you have to pay $10,000 not to do it, I'd be like, I'll pay $11,000 not to do it. Your generation is so different than mine. That's incredible. I mean, it sounds very kind of hip and millennial

and free to be you and me. You guys weren't doing mushroom chocolates or anything? Not on this trip. You decided to do this sober. It wasn't, you weren't, wow, that's super interesting. Anyways, that's why Brian Chesky is a billionaire. He probably did a focus group with Claire and Mia and figured out what it is they're looking for.

I think that sounds, I mean, it sounds, I'm being serious. I think that sounds really, really cool. It was. And thank you, Alejandro, if you're out there. I still remember the guy's name. We'll be right back after the break with a look at Chinese tech earnings. If you're enjoying the show so far and you haven't subscribed, be sure to give the Proficy Markets feed a follow wherever you get your podcasts.

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That's vanta.com slash Vox. We're back with Profit View Markets. Chinese tech leaders Alibaba and Tencent reported earnings this week, offering a mixed picture of the sector. Tencent posted its fastest revenue growth in over three years, fueled by strong performance in its gaming and advertising segments. Net profit rose 14%, while capital expenditures surged 91% year over year, largely

due to increased AI investment. Alibaba, meanwhile, missed expectations on the top and bottom lines as it continues to rethink strategies to drive consumer spending. Still the company reported a 7% year-over-year revenue increase with cloud revenue climbing 18%. Despite the growth, shares fell around 5% in pre-market trading. So Scott, let's start with Alibaba. You predicted the company would beat and that the shares would pop. That did not happen. It was in fact a miss on the top and bottom.

Shares dropped around 5%. I think it's worth asking the question, how bad was this miss? And the answer is not really bad at all. They barely missed on revenue. Net income was a miss, but it was mostly an accounting issue because they got rid of some of their subsidiaries and they had to account for those losses in this quarter. But I think the thing that Wall Street really didn't like,

I think Wall Street, like you, believes that this company is now kind of an AI company. And similar to Amazon, similar to Google, they're mostly excited about the cloud unit and they're mostly excited about the cloud unit and they're mostly excited about the AI prospects. And that's why they expected, as you did, that the company would beat expectations. They wanted to see the AI business come in

and just pleasantly surprise us, give us something really great that exceeded expectations. That's not what happened. It was strong, but not crazy strong. Cloud revenue up 18%. Now, I'll give you a chance to respond to the earnings, but I just want to tell you what I think you missed with this prediction. All the global shifts we've been discussing, the turning of foreign nations away from America

towards China, increased trade partnerships with China, the turbo boosting of AI self-sufficiency in China, which Xi Jinping has been talking about, the AI chip investments from Huawei and all these other Chinese companies. All of that is so recent. And if all of that is happening, I just don't think you would have seen it in this earnings report. I think if it's happening, you're going to see it in the next report, i.e. the current quarter. And even then, you'll only start to see the beginning of it.

And if it's all happening, I think really, if it's going to be really fully and truly reflected, it would probably be the report after that. And so what I would argue is that your prediction here was directionally correct, but I think the timing was wrong. Um, I think if you were to make the prediction again for fiscal Q1, this next quarter, I would back that because I do believe we are about to see a transformation in AI in China. And I do believe that will ultimately benefit Alibaba, but for now,

I think it's too early. Yeah, I got this wrong. I think that I'm still seriously considering buying the stock because I think that they're making the same transition, but they're sort of three, four years behind that Amazon made essentially Amazon as a cloud company now with a retail unit. And it trades, um, it's experienced multiple expansion because it's now considered a cloud company with much better margins. So it's just a much better business. I have in the data here that their AI cloud related product revenue grew over

a hundred percent for the seventh consecutive quarter. Is that accurate? Yes, but those AI related numbers, they don't actually break out what the number actually is. So I'm always a little bit, when they say AI related growth, and it's definitely coming off of a very small base. So I think what we should really be looking at is just cloud revenue, which is up 18%.

And that's good, but I think it's more, it tells more of the story. I think until a hundred days ago, the idea of being a Western company in Canada, Australia, or Germany, and using cloud-based products from a Chinese company was unthinkable. I think as of today, it's, it's less unthinkable because it's now choosing between the lesser of two evils and the thesis I'm trying to figure out a way to make money off of is the

following. And there's always one piece of data that just blows my mind. And I'm like, this is going to have huge ripple effects to the economy. And I try and think about how do I make money from this? And that is the following for the first time in history, global consumers or global citizens on average, believe that China is a better force or a bigger force for good in the world than America. And I think that means how I drill down to that is I think there's going to be a

lot of Western companies or companies in Latin America who are going to decide to use cloud services from a firm like Alibaba and not immediately defer to AWS or Azure cloud services or Google's cloud. So I think that these Chinese companies are specifically Alibaba. I'm disappointed in that 18% number. I don't know what that a hundred percent year on year number was. I took it and extrapolated it out and said, this will be a cloud company pretty quickly if it can maintain that growth, but your deeper

analysis is the better one. I just think it's early. I think it's a very small base that we're looking at. So we shouldn't take a hundred percent too seriously. But there's some issues here. The domestic economy isn't very strong. Your analysis is the correct one that the impact or the slow down from exports is probably not going to show

up until next quarter, but maybe the market's already anticipating that. I just, I get the sense that I think these companies are going to find a lot more foreign buyers contemplating and doing meetings with them than would have four months ago. But there's just no getting around it. I miss this one, but I still might. I thought, well, if I liked it yesterday, why wouldn't I like it now that it's off?

There we go. There's the Warren Buffett in you. Five or 7%. Yeah, there you go. Yeah. And let's just quickly talk about Tencent. Missed on profit, but beat on revenue. The stock slipped slightly, but not massively.

There's honestly not that much to say with these earnings, but the thing that jumped out to me was their CapEx number, which almost doubled up 91%. And almost all of that is, of course, AI spending. So to me, the takeaway is Tencent is jumping headfirst into the AI race. They're stockpiling up on chips, they're building data centers, they're developing these proprietary models, and they're perfectly suited to do this because it's primarily a gaming company, that's their main business, but it's also an advertising company because remember Tencent owns WeChat.

I think what we've seen so far is that the main beneficiary of AI in terms of actual revenue growth is advertising. If you have great AI, you have better, more accurate ad targeting, and that's what we've seen with Meta, which is why Meta is on such a tear right now. So I think we will probably see the same thing with Tencent. I think it was pretty good earnings from Tencent, but the larger story to me is AI as indicated by what Tencent is doing and Alibaba in terms of their spending and their investment in AI, AI in China is coming. It's coming very hard, very fast. I think this should generally make you bullish on China, specifically the Chinese tech sector.

And I should point out just the P multiples again. China we got at 15x average compared to the US at 27. And that's despite the fact that the Hang Seng is up 20% year to date. It's been a great year for the Chinese market, but you're still looking at really low multiples when you compare it to the US. So, you know, we've been balancing this US versus China argument all year, and it's beginning to become less clear what's really happening, because now you've got the S&P back up above where it was before Liberation Day. So the whole global rotation thesis, I would say is on hold for now. I'm not sure if it's dead. But I think just if you look at just pure earnings growth, forget the multiples. I think there's a lot a lot happening in China.

I think there's a lot of reasons to be bullish. I agree with all of that. We'll be right back after the break with a look at the Republicans' tax bill. If you're enjoying the show so far, hit follow and leave us a review on the Profit-U-Markets feed. Donald Trump's been back in office long enough to shock or surprise just about anyone who voted for him at this point, be it the signal scandal, or the Tariff turnarounds, the Jeanine Pirro of it all, the way he talks about Ozempic. And he takes the fat, the fat shot drug.

So rude. I'm in London, and I just paid for this damn fat drug I take. I said it's not working. Damn fat drug I take. I said it's not working. On Today Explained, we're asking if any of his voters are experiencing voters' remorse. Especially those ones who are newer to his winning coalition.

Younger voters, black voters, Latin voters. We're heading to Philadelphia, Pennsylvania to ask them if regrets? Do they have a few? And just by way of spoiler, to get this out of the way, the answer is yes, they do. And he takes the fat, the fat shot drug. Listen, I get it.

Naming a streaming service is hard. There's a lot to choose from. Most of the words are nonsensical, but there is simply no excuse for the fact that Warner Brothers Discovery got rid of the name HBO, one of the best brands in television, only to decide a few years later that, oh, actually, it should have been called HBO Max all along. This week on the Vergecast, we talk about how this branding disaster at HBO came to be and what might happen next. Plus, everything happening at ESPN, the future of Fox, and what happens if you get ants in your Sonos speaker.

All that and more on the Vergecast, wherever you get podcasts. We're back with Profit to Markets. House Republicans' new tax plan cleared its first hurdle last week. With the House Ways and Means Committee voting to advance the bill, the plan includes several major provisions including increased defence spending, cuts to federal Medicaid funding, and a higher exemption for the estate tax. The bill is still in the early stages and is likely to undergo changes as it moves through Congress.

House Speaker Mike Johnson is aiming to send it to the Senate by Memorial Day. I'd like for us to really investigate this because I think about everything that we've talked about over the past few years, and I specifically think about your TED Talk. Okay. I start us with a question. Do we love our children? Sounds like an illegitimate question, right? Well, I'm going to try and convince you otherwise.

Essentially, as we go down generations, we're seeing that for the last two generations, people are making less money on an inflation-adjusted basis. In addition, the cost of buying a home, the cost of pursuing education... And it was the most popular talk of the year. We're seeing more and more discussions about these issues. We even had a week ago where Trump said that he was okay with increasing taxes on the rich. But I look at this plan here,

this plan basically does the opposite of everything we have advocated for in the past three or four years. And I'm seriously not being political or sensationalist here. It genuinely does the opposite of what everything we've been talking about. I'll just go through a few of them here. For starters, massively increases the deficit. It's going to reduce federal revenue by $5 trillion over 10 years.

Does not make up for those losses with spending cuts. There are cuts, but we'll go over them. The cuts are very misguided. So what does that mean? Larger deficits, more debt, increased interest payments. We're screwing over the next generation of Americans. We're going to have to pay the bill when our parents and our grandparents are all dead. The carried interest loophole is staying.

Trump talked a big game about getting rid of it. This nonsensical tax break for private equity, it's staying in there. We're getting tax breaks for old people. If you're over the age of 65, you're now gonna get a larger standard deduction than you did before. The worst part of the plan in my view,

the estate tax exemption. Wealth inequality has gone totally haywire, out of control in America. We've discussed it a lot. And the question we have all been trying to answer is, how do you redistribute that wealth that has been sequestered into the top 0.001%? How do you redistribute the wealth in a way that is fair,

in a way that isn't crazy, and in a way that doesn't mean showing up to rich people's doorsteps with a shotgun and a pitchfork. My view on this has always been the easy answer is just tax it when they die. You've got a hundred twenty four trillion dollars that are going to be passed on in 2048. Greatest generational wealth transfer in history. That's the moment to redistribute the wealth without making everyone upset. And how do you do that with an estate tax?

It's very simple. You're not gonna just seize all the assets, but you're just gonna tax it at a normal rate. So I was, I couldn't believe it when I saw this plan where they are actually going to increase the estate tax exemption, which is already absurdly high in America. They're increasing it to 30 million dollars, which means you can pass 30 million onto your children tax free.

In other words, we're deciding we actually like the inequality. We want to maintain it, not just for this generation, which seemed like an anomaly, but for many generations to come. We want the children of rich people and their children to keep on ruling and ruling over many generations of society. And by the way, with the way we're going to do that, we're going to subsidize that by cutting healthcare spending for poor people. What the fuck is going on, Scott? The most powerful in America formed a coalition where their rights are a function of their wealth and their rights are respected anywhere in the world.

I can get access to family planning, lawyers, healthcare, good schools for my kids because there's now kind of a different class of oligarchs that consists of both Democrats and Republicans. And as a result, the most powerful people don't feel invested interests in the long-term success of America. And it's, it's, um, it's from both sides. Now it took Republicans to be the vessel to do it, but it's been a slow creep of both Democrats and Republicans. Just, just to be clear during the Biden administration, taxes were lowered.

For all the railing of senators, Warren and Sanders. When we controlled all three houses of government and president Biden was president, taxes went down. So there are a lot of co-conspirators here, including many of my friends who claim to have democratic ideals and clutch their pearls about, you know, how awful it is what's going on. But this really is, this is another extension of it. And as you know, I was supposed to be on Bill Maher with Steve Bannon and I decided to back out because I couldn't figure out a way to not confront him

about a Nazi salute without grandstanding or, and so I backed out and he said on that show. Trump and the MAGA movement will raise taxes on the wealthy. All right, let me ask you another thing. I was watching it with my 17 year old and I said, he's lying, there's no way Donald Trump is not going to cut taxes on the rich.

That's just what he does. And he is not a good business person. His attitude to debt is, anyone who's willing to loan you money is a fucking sucker. I genuinely think there's a decent chance that Trump in the back of his mind is just not that worried about America going bankrupt. He's gone bankrupt a bunch and he's still a billionaire. But what about all the, what about everyone else?

I mean, we know he's insane for many reasons, but what about everyone in Congress? Like I don't understand how anyone would be okay with we're gonna cut Medicaid spending. I mean, that argument alone, I'm willing to have that conversation, but then pair that with, oh, and by the way, we need to increase the amount of money that rich people, ultra rich people

can pass onto their kids tax free from $27 million to $30 million because of inflation. Bridge that gap for me. The way the Democrats should frame this, and it's the truth, is people of my generation who are wealthy are asking your generation to loan us $24 trillion. And we're not going to pay it back. You're going to assume the loan. That's what we're asking right now.

That is, and that's how the Democrats should be positioning it. Now, as it relates to trusts, as someone who has a trust, the trust is gone from, I think it was a maximum of 11 million, then it went to 23 or 24. And now they're talking about raising it to 30, meaning you can shield from all taxation, $30 million. But it's even worse than that because the way estates work is if you put money in and it grows, it grows tax deferred and it grows.

You might end up with a trust that ends up being worth a quarter of a billion dollars. But my understanding is as long as it's worth less than 30 when you put the assets into the trust, it can grow and then you can pass it along tax free. What's the point of all of this? The point is to have a purpose, have purpose in your life and to have a good life and to be happy and to have reward.

And I would argue that most of that is around relationships and potentially finding the right partner and maybe deciding to have a family with that partner. I think that's the whole shooting match. And money plays a big role in that because middle income people are happier than lower income, upper income people are happier than middle income. Money does my happiness. But as Daniel Kahneman, the Israeli American psychologist proved, above a certain point,

there's no incremental happiness. And I can validate this firsthand as someone who has worked really hard and been very lucky and aggregated some wealth, I believe that I have the right to pass on some of that good fortune and wealth to my kids. Okay, fine. But above a certain amount, much less than $30 million, my kids are going to get no incremental happiness. And so if the whole point is prosperity and happiness and purpose and meaning, then there really isn't a reason to increase the cap on the estate tax. You should be lowering it and even increasing the tax rate, which I think now is 40% because nobody loses.

And that is if you redistribute that income for things like a child tax credit, for public, a great public school system, for K through 12, such that kids grow up and can be a little bit more critical thinkers and maybe think, am I voting for people that have my best interests at heart? All of these wonderful things, right, can be taken from estates and there's no degradation and happiness or purpose among your offspring. But no one wins here. No one wins. The only people that lose are the future generations that need that tax revenue because what we have to come to grips with is the reality that there has been a myth fomented in America that the middle class is a natural self-healing occurring organism.

It isn't. If you don't massively invest in it, let me use the R word. If you don't redistribute money from corporations and rich people to the middle class, it starts to wither and die. Look, if you want to give your kids $10 million tax-free, and I'm one of those people. I get it. I want my kids to have a certain amount of economic floor. I've worked too hard for my kids to go through. And a lot of people, a lot of parents will say, I want my kids to make it like I did.

I don't. I work so fucking hard. I don't want my kids to be fearful about money. I don't want, if someone in their life is sick, I don't want them to have the same fear as I had when I had someone in my life sick. I want to give them that, if it makes them spoiled, so be it. But they don't need more than $30 million. That's not gonna do anything for them.

It's unbelievable. And by the way, we're almost talking about it as if the thing that's on the table is just having a total cutoff rate for the amount that a child can inherit from their parents. We're talking about an exemption. It's like you get the 30 million tax-free, and then everything beyond that point is 40% taxed. So you're still going to make, I mean, these kids are going to inherit literally hundreds of millions of dollars.

And the question is, why are we increasing the tax-free exemption? Why is that such an important thing? And when you're saying, like, who wins here, it honestly feels like the only ones who win. I agree with you. I don't think the kids win. I don't think you win because you got $10 million more tax-free from your parents. I think you'll probably just become more of a douchebag,

less in touch with reality, probably live a worse life, as you put it. I think the only people winning here are the parents who have this perceived sense of, I fucking crushed it. And I worked so hard and I made all these hundreds of millions of dollars. And because I worked so hard, I need to do everything I can to hoard that wealth and to protect it. And I'm not gonna be able to spend it over the course of my lifetime.

I've got what, 20 years left. What am I gonna spend $200 million on? So the only other option is to say, oh, well the last thing left to conquer is to make sure that the most amount possible can go to my children. The thing that summarizes America right now is what Bill Gates said. And it's the following.

And it was such a rattling statement. I thought, Oh my God, that's so accurate and so puncturing and so upsetting. Bill Gates said the world's richest man is killing the world's poorest children. And that's what we're doing here. America is tolerating the world's wealthiest man worth $400 billion, cutting massive amounts of aid to literally the poorest children in the world. And America seems to be okay with it.

There is a lack of a value system in America where people are deciding what makes me feel good, what gets me richer, as opposed to any resemblance or any semblance of values. And this runs so deep in America. And I think it's because we have had such prosperity and we have been so divided by social media algorithms that we don't recognize how fortunate we are.

We don't recognize that we should be serving in the agency of each other and that we're Americans first before we're gay, before we're Republican. We are Americans first. And that the whole idea of America is that once you make it, you are absolutely going to start investing in the fertile lands behind you such that as many people as possible can enjoy the same blessings you registered instead. Everyone's like, no, I just want the shit in front of me to be laced in cocaine fields and see if I can figure out a way to create clouds that rain

champagne. I mean, it has gotten out of control. But they lie about what their intentions are. And I think that's, that's what we're seeing with this tax plan, which is what is so upsetting is how easy it is to lie and how many people believe you. I mean, the whole, the whole point of this administration from the get-go, or at least the fiscal plan, was fiscal responsibility. The whole thing was, let's balance the budget. Just look at the fucking plan.

It does the opposite of what was intended. Look at Bannon's comments, we're going to tax the rich. Look at Trump's comments, I'm okay with taxing the rich. I would love to do it, frankly, but what we'll do is that, you know, they'll go around saying, oh, this is so terrible. Would you do it? Is you're giving up something up top in order to make people in the middle income and the lower income brackets say more. So it's really a redistribution. And I'm willing to do it if they want.

And you look at this, all these exemptions here. It's like, in addition to that, they're now lying about it. And I'm hoping people sort of see through the lie. So that's why I really want to talk about this. It's like, this is just a proof here that it's all been lies in terms of what they've been promising and the direction they want to take this country. The whole thing with the reshoring, the jobs, and it's all about middle-class Americans. Read this tax plan.

This is not about middle-class Americans at all. It's actually insane the extent to which this is catered to rich people. Just a few details. If the changes from this tax cut pass, about 8.6 million people stand to lose their health coverage in the next nine years. changes from this tax cut pass, about 8.6 million people stand to lose their health coverage in the next nine years. And by the way, Medicaid provides healthcare coverage to one in five Americans, including 40% of all children.

It's also the largest funder of mental health and substance use disorder care. You wanna cut that funding, that just means you're gonna pay more for incarceration folks. Oh, but guess what? There's a private company with shareholders waiting to, to incarcerate people at 70 to $90,000 a year.

True. Look, you want to cut social security for the wealthiest quartile of seniors, or you want to extend the age qualification from 65 to 68 to 70, 72 to recognize that people are living longer and working longer, that shit makes sense, but when you start cutting costs on things like SNAP, you're just gonna end up paying more in other ways. Having said all that, there are a few little good things that I will just go over just to end on a positive note.

They wanna increase the child tax credit from 2000 to $2,500. I think that's good. Yippee. But you know. It's something. Okay. Let's take it. The tax, the estate tax exemption is going from 15 million to 30 million, but we're increasing the child tax credit from 2000 to 2500. Okay. That's something. They want to create savings

accounts for babies. Newborns will receive a thousand dollars in a tax-free account. This is actually what we discussed with Brad Gerstner, who wanted those America accounts. And Bill Ackman's idea and Alex von Furstenberg has been proposed something similar. Australia has, I think it's the super fund. You give, I love this idea. I would give every kid $7,000. That'd be 40 billion.

And then in 30 years, you'd start to see a crash in interest rates because you would announce in the next 30 years, we're not going to have social security because every kid's going to have approximately a million dollars and I wouldn't let them sell it. I'd treat them, I'd be very paternal and say no social security on your 65th birthday, you get a million bucks, put in an account at four or six percent, you get 40 or 60 grand. If you want to blow it, sucks to be stupid, that's up to you.

But I like this idea a lot. Me too. They also want to eliminate the EV tax credit, which I also agree with. I think the EV industry is well in its way. You don't need, we don't need to be subsidizing it. If we're having tough conversations about cutting spending, then I agree, let's get rid of the EV tax credit. And then finally, they wanna increase taxes

on private colleges with endowments exceeding $2 million per student. Those colleges will pay 21% on net investment income up from 1.4%. Again, I think that's great. And it targets what we've talked about. And spend it, spend your endowment, spend it. Exactly. Bring it down.

The only trouble is they also go after the less wealthy colleges too. So if you have an endowment of 750k per student, your taxes are also going up. And then the other thing that I think is bad is that for whatever reason, they're So if you have an endowment of 750k per student, your taxes are also going up. And then the other thing that I think is bad is that for whatever reason, they're exempting religious schools. And I assume they're just kind of throwing meat to the evangelicals where it's like, oh, you guys, we like you, you're not Harvard and Princeton, so you guys don't have to pay taxes.

That'll create some really unnatural acts though. It's like, what are we going to do? Like before Algebra, at sophomore year at UCLA, we're going to go praise Jesus. And then we're a religious institution. Yeah. And we're going to do that so that we don't have to pay taxes. It's weird. Anyway, the outcome I actually think is good.

Uh, but I think they're probably doing it for the wrong reasons, which is again, they want to own the libs or own the Ivy league schools, but whatever. The Ivy league schools probably have it coming for them. Those are the good things. Otherwise terrible plan. My God. Ed Olsen has had it. He's had it.

Ed Olsen. Let's take a look at the week ahead, Scott. We'll see new and existing home sales for April, as well as earnings from Home Depot and Target. Do you have any predictions for us? My prediction is kind of boring. I was thinking, I'm just so triggered by this plane being given this $450 million plane. I think that's so embarrassing that the wealthiest, the president of the wealthiest nation in

the world needs to have someone else pay for a plane manufactured here. Uh, it's not going to happen for a very mundane reason. And that is it would take, I think very little C4 planted somewhere with a pretty sophisticated and small detonation device to put kind of, you know, I won't call it Air Force one, but Qatar's bitch two, whatever you'd want to call this plane. You could sabotage this plane. You could put in, I mean, these, a 747 Supermax, whatever it's called, is basically like a small city in terms of wiring and electronics and fuselage and paneling. of wiring and electronics and fuselage and paneling.

There are be so many places to hide, to hide listening devices, espionage devices, or even worse, some sort of detonation device. And to think that Qatar would have the ability to take down Air Force One, means the only way the NSA, the secret service who's charged with the president's safety would get comfortable with this is if they disassembled the plane down to every bolt and screw and then reassembled that and the cost of that is estimated to be $2.1 billion.

And you don't think Trump would have an ability to say, shut up, it's fine. I think they're going to sit them down and I say, look, boss, we can't have you flying on something. I mean, that the Qataris could have easily weaponized. I think they're just going to say, we can't guarantee your safety on this thing. So we were stupid enough to let Russia build our embassy in Moscow. And when they opened it, a couple reporters went in there with like just a sledgehammer into one of the unfinished rooms and just did a little bit of sledgehamming. And they found like seven listening devices

every square foot. I didn't know that. The perfect example. Oh yeah, it was hilarious. And they basically said, they basically said, demolish the thing, we can't, we have to bring in our own contractors and we have to build it. We can't have the Russians build our embassy. That really isn't any different.

Anyway, so a long-winded way of saying my prediction is that the 747 GIF is not going to happen. This episode was produced by Claire Miller and engineered by Benjamin Spencer. Our associate producer is Alison Weiss, Mia Silverio is our research lead, Isabella Kintzel is our research associate, Dan Chalon is our intern, Drew Burrows is our technical director and Catherine Dillon is our executive producer. Thank you for listening to Profit G Markets from the Vox Media Podcast Network. Join us on Thursday for our conversation with Scott Goodwin, only onffesion Markets. The FD is doing a profile on me and they can't... There's someone outside.

Home invasion, here they come. At this point, just... just... just do me in the ass. Just take me. Anyway. Ha ha ha. Ha ha ha.