The Rundown - Deep Dive: Trump's AI Era Begins with Billionaire Drama & Threat from China

Episode Date: January 26, 2025

In this Deep Dive episode, we’re diving into one of the most eventful weeks in AI history. From President Trump’s $500 billion AI infrastructure initiative and his controversial executive orders to Elon Musk and Sam Altman trading Twitter jabs over “Project Stargate,” the drama was endless. We’ll also unpack Meta’s bold $65 billion AI investment and how a Chinese startup, DeepSeek, shocked the industry by slashing AI model costs by 90%. Tune in for all the breakthroughs, billionaires, and beefs shaping the future of AI.The content of the video is for general and informational purposes only. All views presented in this show reflect the opinions of the guest and the host. You should not take a mention of any asset, be it cryptocurrency or a publicly traded security as a recommendation to buy, sell or hold that cryptocurrency or security. Guests and hosts are not affiliated with or endorsed by Public Holdings or its subsidiaries. You should make your own financial and investment decisions or consult respective professionals. Full disclosures are in the channel description. Learn more at Public.com/disclosures.Past performance is not a guarantee of future results. There is a possibility of loss with any investment. Historical or hypothetical performance results, if mentioned, are presented for illustrative purposes only. Do not infer or assume that any securities, sectors or markets described in the videos were or will be profitable. Any statements of future expectations and other forward-looking statements are strictly based on the current views, opinion, or assumptions of the person presenting them, and should not be taken as an indicator of performance nor should be relied upon as an investment advice.

Welcome back to the rundown for a weekend deep dive. Today, we are looking back at the crazy week in AI. This past week, President Trump signed an executive order about AI. He also announced $500 billion in AI infrastructure investment. A couple billionaires started beefing on Twitter about AI, and another billionaire got caught in 4K. And then on top of all that, an AI startup in China shocked the industry by significantly reducing the cost of AI models.

There's so much that happened that we wanted to dedicate it. a full episode to break it all down. So let's get into it. Let's start with the White House. This week started with Donald Trump's inauguration on Monday. And since retaking the Oval Office, he's been busy signing a ton of executive orders and making big announcements. On day one, Monday night, Trump started by revoking Biden's 2023 executive order that put

some guardrails on AI development. The Trump administration wants to remove the guardrails and safety measures and instead focused on accelerating innovation. There's definitely some risk with that. We might end up with Skynet, but the rewards might be worth the risk, especially with all the competition the U.S. companies are starting to face. We're going to talk more about that in a bit. To add to this, on Thursday, President Trump issued an executive order to help bolster the U.S.'s position in AI by reducing regulatory constraints. Trump is targeting policies that he believes have, quote, ideological bias or engineered social agendas.

Now, on top of that, this executive order calls for the creation of an AI action plan with, than 180 days. This plan will establish policies that enhance the U.S.'s AI dominance. You know, right now the U.S. is the leader in the AI space. We make all the best AI chips. We have all the top AI companies based in the U.S. But we're starting to see some big innovations come out of China. Again, we're going to talk more about that later in the show. Trump is hoping that these executive orders along with his AI action plan will keep the U.S. dominance in the AI industry. We're going to get more specifics about his AI action plan in 180 days. Maybe we'll do a follow-up deep dive when we get more info.

Now, Trump has spent a lot of time with billionaires this week, especially tech billionaires. His inauguration was attended by his BFF, Elon Musk. Jeff Bezos was there with his fiancee Lauren Sanchez. Mark Zuckerberg was there. Those names might come up again later in the show. There was also CEOs of Google, Apple, and TikTok. And Trump has wasted no time making big announcements from his new tech friends. On Wednesday of his past week, he introduced a new $500 billion AI infrastructure megaproject

by OpenAI Oracle and SoftBank called the Stargate. project. This joint venture is planning to spend $500 billion over the next four years to develop cutting-edge AI infrastructure in the U.S. with $100 billion set to be deployed immediately. President Trump said that Stargate will build physical and virtual infrastructure to power the next generation of advancements in AI while creating 100,000 jobs almost immediately. Those are some pretty big promises, some pretty big numbers being thrown around there. The Japanese firm SoftBank will lead the financial matters on this joint venture. And Open AI will oversee the operations, and Oracle will act as a key technology and funding partner.

This AI super team will also include contributions from Abu Dhabi's AI-focused state fund, MGX, and also have tech partnerships with Microsoft, Nvidia, and ARM, which is owned by SoftBank. Now, all of this is really exciting stuff, but this big announcement had Trump's BFF, Elon Musk, in his feelings. It's pretty well documented at this point that Elon has beef with Open AI and their CEO, Sam Altman. Elon was one of the co-founders of Open AI back in the day, but he left the company back in 2018. Now he runs his own AI company, XAI, which he founded back in 2023. And, you know, maybe he's just feeling some FOMO that he didn't get invited to the AI party at the White House. But yeah, he started lashing out at Project Stargate on Twitter.

He replied to Open AI's tweet saying that they don't actually have the money that SoftBank, who's in charge of the financing, has well under $10 billion secured. And you know, I low-key think that Elon might be right, because $500 billion is such a huge number. And there hasn't been any sort of details on how it's all going to be paid for. But the way this is playing out on Twitter is kind of silly. I mean, it makes for great drama and content. But it feels like high school, you know? Elon and Sam are firing back at each other. Sam was sub-tweeting Elon.

So yeah, we got billionaires with giant egos just being petty. Go figure. The best part of this beef, though, was Microsoft CEO, Satya Nadella's response. He was being interviewed in Davos this week, and he was asked about Elon's criticism of the Stargate Project. And his response was so good. He, you know, let's just play the clip. I don't know if you saw Elon Musk took to Twitter and said, they don't have the money. The money doesn't exist.

As if this is not really going to happen. What do you think of that? Look, all I know is I'm good for my $80 billion. I am going to spend $80 billion. I mean, that clip goes so hard. Satya was dropping bars, man. Now, since we're talking about CEOs going hard, we have to mention META's CEO Mark Zuckerberg. He made a lot of headlines this week.

And no, I'm not talking about getting caught in 4K with wandering guys at the inauguration. I mean, Zuck, come on, man. That's a rookie move. What I'm talking about is his announcement on Friday that META is planning to spend $65 billion on advancing AI efforts in 2025. You know, meta's pace of AI spending continues to ramp up. The $65 billion number for 2025 is 50% more than it was in 2024. and it's double what they spent in 2023.

Zuck said that part of the spending will go towards a new data center that he said will be so large it would cover a significant part of Manhattan. Mena originally announced this data center back in December. They're building it in Louisiana, and it's going to cost like $10 billion. Mena is also starting to build other data centers to support their large language model Lama. So Zuck has pretty big plans for META when it comes to AI.

In that same post on Friday, he said he expects META to be the leading AI assistant for more than 1 billion people. And it kind of makes sense because 2 billion people already use meta apps like WhatsApp and the Facebook app and Instagram. So I can definitely see a billion people using their AI assistant.

What I find interesting though is the hard pivot that Zuck and his company has done over the last couple of years. Meta went from going all in on the Metaverse to now going all in on AI, spending $65 billion in the process. And Zuck went from being a robot nerd to being cool and doing MMA.

He's really really really, revamped his image, and now he's trying to get on Trump's good side too by making some policy changes at his company. And all those changes seem to be working, at least for the stock price. Their stock is at all time highs, and out of all the magnificent seven stocks, meta was the second best performing in 2024, behind only in video. And I wouldn't be surprised if it was the best performing one for 2025. So I just mentioned a lot of big things that are happening in the U.S. when it comes to AI. But crazy enough, the most talked about AI story this week is coming out of China. It's about this Chinese startup called Deepseek, and I'll be honest, until this week, I had never heard of them.

But now I'm seeing their name everywhere. Deepseek has shocked the tech world this week with the release of their R1 reasoning AI model that is open source. And it seems to be just as good as OpenAI's latest model. But what's so shocking is that Deepseek's model is 90 to 95% cheaper to run than OpenAI's model. And that is truly blowing people's minds. On top of that, Deepseek said that they were able to train their V2. three open source model with just $6 million of computing power. That is orders of magnitude less than what OpenAI, Google,

meta, and other tech companies are spending to train their models. Now, one reason that DeepSeek was able to pull this off was because they were kind of forced to. Remember, the U.S. has export restrictions on sending the best AI chips to China. These AI chips are critical to train AI models, and the more you have, the better of an AI model you can make. Well, Deepseek did have some Nvidia chips, which they acquired before all these export restrictions, but they weren't able to get their hands on more. So they were forced to make their model

very efficient, and it looks like they pulled it off. So this has people in Silicon Valley second-guessing a lot of things. You know, I think until this week, a lot of people thought that the U.S. was the clear leader in the AI space because of our cutting-edge models and access to the most advanced AI chips. But China, it looks to be making a big splash with significantly less resources. That's kind of what China has done historically with other industries, right? They became dominant with making cars, electronics, and toys, because of their abilities to make things cheaper. And they're doing it again with AI. So I wonder how US companies are going to respond.

I just spent the first part of this show talking about the billions of dollars that companies like Microsoft, Google, meta, and Open AI are planning to spend on AI over the next few years. We're going to see a pullback in that? Are we going to see any pushback from investors? For the past couple years, Wall Street was okay

with the billions of dollars being spent on AI, but are they going to get impatient if all that AI spending doesn't lead to more profits? Something to keep an eye on. Deepseek has a lot of people asking questions. and they might have just changed the game, which is why DeepSeek was the top AI story of this past week. Well, all right, guys, that's it for today's deep dive on this crazy week in AI.

The AI world is moving so fast that by the time you listen to this show, there's probably going to be another groundbreaking development. So I'm sure we'll have another follow-up episode in a few weeks to catch up on all this AI news and drama. There are other topics you want us to cover on a deep dive episode. Let us know in the comments on Spotify or YouTube. And while you're at it, don't forget to subscribe and hit us with a five-star rating. Thank you guys so much for you.

for listening. Shout out to Mike and the incredible team at public for all the work behind the scenes. And we'll see you guys back here on Monday.