This Week in Startups - All-In E8: TikTok + Oracle, how privacy loss will impact society, economy & COVID outlooks for 2021 & beyond, California wildfires & more

Episode Date: September 19, 2020

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Hey, everybody, hey everybody. Welcome to another episode of All In, the podcast. Episode 8, Besties are here to talk about tech, economy, politics, the election, and our lives in Silicon Valley. Welcome back to the pod. David Friedberg, the Queen of Kinwa is here from an undisclosed location. Always a joy. Yes. Undisclosed location somewhere in the Midwest.

You bailed on SF after the smoke. You lasted how many days into the bar? barbecue into the orange cloud? I left on the Wednesday of the orange cloud and took, it was crazy. Took my kiddos and we're waiting out the fires in the Midwest. Well, it's beautiful the last two days here. Also from an undisclosed besty location, David Sacks, back on the program. Rain Man is here.

Yep. Definitely here. Good to be here. All right. Well, there you go, a man of many words. And speaking of a man of many words, hot off of seven keynotes. week talking about Spax, the Prince of Spacks, Chimoth Polly Hopatia back on the pod. How are you, besties?

Well, we had a little besty reunion, which I think we can talk about. Chimov invited us over to have an outdoor bestie reunion. Yeah, and you gave one of them gonorrhea, and you gave the other two. Well, it's crazy to say, but I literally had to call Chimov two or three days after he hosted Oh, so a socially, by the way, a socially distanced dinner outdoors. Social distant dinner outdoors. Wonderful. We had some great rib-eye. Fantastic. Cracked open a nice bottle or two of wine and the port. But then, what did you do?

Well, then a family member of mine who shall remain lameless decided to go to a party in San Francisco and possibly got. the Rona and he tested positive and then I had to get everybody in my house tested twice. Everybody came back negative but I had to call Chimoth and tell him, listen, I wasn't exposed but some members of my family were. Therefore I might have second hand exposure. I took two tests, came back negative two times in a row. Can I just say though it's really crazy like we have to develop all these new social norms and you're not sure what to say and you're not you're not sure how to react and it's like it's it must have been like when you know you got a call

and it's like, hey, listen, you know, your girlfriend's like, I may be pregnant or like, you know, somebody's like, hey, listen, I have an STD. Like, you just like what is going on? I felt like that when I was texting the group chat. There's like three of us and I had to text with my tail between my legs. I think I've been exposed. I'm really sorry, guys. I think Calcanus is the Greek word for turd in the punch bowl.

You know, it's all. Code 13. Yeah, exactly. I don't know if we can tell the Code 13 story. Oh, I'm going to tell the Code 13 story. I wasn't even there, but I... The Code Arts Cesar is legendary. Jason, Jason Calcanus gets invited by David Sacks

out of his benevolence to come to stay in Hawaii at the four seasons. And at somewhere, some point during this week-long vacation, Christmas Day. Christmas Day, you hear a shout from the pool from the lifeguard. Well, no, no, it was even before that. We were sitting at the bar. So me and Jason and his brother-in-law were sitting at the bar having drinks, and all of a sudden there was a commotion

and the bartenders and the staff and he started hearing people on walkie-talkies saying code 13 code 13 and we don't running we don't know what to make of that we think it's a terrorist attack I mean literally the four seasons is on a high alert alarms are going off

boop boop and then we hear okay well we're like we said to the barter well what's a code 13 and he's like well it means that some kid you know crapped in the pool you know dead of number two in the pool. And we're like, you know, and then, and we're like, okay, well, you know.

It was Jason's kids. Well, so then I started hearing something about like the Sacks kids. And I'm like, oh, no. Sacks code 13. Yes. And they thought it was us. And then it turns out it was, it was Jacob's kid. And we were, we were never able to get a, a reservation. No, but they have to. Well, what's so funny is like, I, I went there at one point, a few years later. And it's a whole ordeal because they said, so how do you guys deal with like, you know, Code 13. They're like, oh, Code 13. You have to evacuate the whole hotel.

Half the island gets sent to it. Here's what had to happen. This is on, just to put the Code 13 in perspective, I think my 10-year-old at the time was two years old. My sister-in-law takes the baby in the pool without telling anybody, and the baby's not wearing a swim diaper. And so basically a Snickers bar floats out of the, and there's a stickers bar in the pool.

And you guys have kids. You know how big these things. can get. You're like, how is that possible? You know, like a movie theater size snicker, a king-sized snicker pool is floating in the middle of the pool. But this is on December 25th. These poor people are spending $3,000 a night. There is not a single-chaise lounge by the pool that's not occupied.

It is peak capacity at the Four Seasons Hotel on the Big Island or wherever it was. The pool has to be shut down for four hours. The person has to get in with a hazmat suit. retrieve the Snickers bar, king-sized Snickers has to get out of the part. Then they have to throw in every chemical known to man so much so that the pool is ruined for Christmas Day. And that's the Code 13 story.

All right, getting back to our topics. TikTok is on the verge of being banned from additional U.S. downloads. The Commerce Department has announced that it will ban U.S. downloads and business transactions with TikTok and WeChat. Somehow WeChat got pulled into this on Sunday. This will, seemingly, we're going to allow TikTok to operate until November 12th. So they got a little bit of a stay of execution. But, of course, if they can't update in the app store,

that means there could be any security vulnerabilities that get found between now and then, would not be able to be updated. And Steve Mucin, it's attempting to push through a TikTok deal that will enable retaining some Chinese ownership. and there's some sort of agreement now with Oracle, we'll have some kind of an oversight board to do continuous third-party audits. What does this say, Chimov, about where we're at

and do you believe that, you know, a Democratic leader, let's say Obama or Biden, would have taken the same approach here? Does it worry you that the government's getting this involved? Or is this inspiring that the government's putting their foot down and saying, hey, listen, we're going to need to have some, basic level of reciprocity from China if we're going to allow you in our apps. You know, I think it's kind of like, you know, like if you've ever been driving someplace with

your significant other and they're like, turn left and you're like, no, no, no, I'm going to turn right. And then you realize you should have turned left, but then you keep turning right a few more times. Then you take a couple more lefts. But then you end up at the same place, but it was complete shit dumb luck. I feel like we're going to end up in the same place here with TikTok, which is that I think that, The Trump administration probably is doing this, and Donald Trump specifically probably does this more as a demonstration of power and American exceptionalism, which I'm not sure is the right reason to do it.

But I think the outcome is right, which is that for years, China has essentially been shut out to American companies unless you effectively just kowtow to these guys. And some companies have and some companies like Google have not. and other companies like Facebook have been totally basically blocked from entering. And so I think it's completely right. It's unfair to have the asymmetric market advantages that Chinese companies have had. And so you have to play hardball to create a different set of rules. And I think this probably gets us to that place.

The reason why it's happening is probably more because the TikTok people played that joke on Trump at the Tulsa rally, if I had to guess. Yeah. What do you think, Friedberg? Is this a good sign for America and the globe that, you know, and the democratic nations of the world that we're going to put a foot down with China and say, hey, some reciprocity, or you're not going to be able to participate in our marketplace, or is this a personal vendetta from Trump or a little bit of both?

I mean, I don't see how it's anything but a slippery slope forward in the escalation of, you know, what's going to be kind of transpiring between these two nations in the next couple of years and maybe decades. You know, this goes back to the, you know, early, you know, 2000s when Google and others wanted to enter China and China has, for those who don't know, China has this great firewall, right? Chinese citizens can't openly access the rest of the internet. And China wanted to censor content and censor what their citizens are accessing. And so there's been a back and forth between the tech industry and China going back almost 20 years now to try and figure out how we can bring our services to China. And then China launches

as a service that's very successful in the U.S. in TikTok. And I think it's just a part of the reciprocity equation, which doesn't resolve anything. It only escalates things. So it's unfortunate, but it's just kind of another step in the path that I think is inevitable in front of us here. Saks, we'll give you the final word here. Is this a good thing for humanity, for international relations, that China is having a little bit of a hand check here, like, hey, there's going to be a limit to how you can operate in the West,

or is this a personal vendetta from Trump? And then what do you see going forward? It's true that, I mean, first of all, our social networks are not allowed over there, so I don't think we need to feel bad about, you know, not allowing their social networks over here. But besides reciprocity or the lack of it, I think the deeper reason for this is just around data security and how the, you know, and I think that the CCP has given us adequate grounds here to ban not just TikTok, but, you know, apps like that, because President Xi himself declared this policy of civil military fusion, which means that any business in China, any business asset there, including data, can be appropriated to serve the ends of the Chinese military or the

Communist Party. And, you know, the CCP has set up this vast surveillance. apparatus over its own citizens. It's asserted extraterritorial sovereignty over former Chinese citizens, meaning dissidents. So the Chinese diaspora anywhere in the world, they've asserted sovereignty over that. And recently there was a pretty remarkable speech by the FBI director Christopher Ray describing Operation Fox Hunt, which is the Chinese effort to track down and presumably ultimately punished Chinese dissidents anywhere in the world. And as part of that, the Chinese have sort of weaponized AI and social media. And so he also described, I mean, this is like pretty amazing, you know, that the Equifax hack, which collected data on something like,

sensitive data on over 100 million Americans, the Chinese were behind that. I didn't know that. And so, you know, it's true, it's true that, you know, no one piece of data poses by itself a risk to to the security of America or Americans, but it's sort of this systematic collection and aggregation of the data and the hacking collectively that I do think pose a security threat. And I think you've got to stop right there, Sack. Actually, an individual's data could absolutely be compromised. If they have access to your passwords, because through the clipboard, they've access to your phone roll. If a young person had photos that were, say, compromising in their photo role, the phone is, you know, basically given access to that. They upload that. Now you could use that as compromise

against a senator's child or against a senator themselves. And this seems like an abstract thing, but this is exactly what the Chinese and Russians have been doing for a very long time. If you've seen the series of the Americans and you go back to the 80s to see the weaponization of, you know, somebody who was in the closet who was gay during that time or somebody who was having an extramar, you could compromise anybody with just sexual compromise. And you hear we're giving access to hundreds of millions of people's photo libraries. By the way, clipboards. By the way, you just said something that's really scary, which is like if you're, if you're the Chinese and, you know, they have the patience to play the long game, you just aggregate and collect this thing for 30 years

on the off chance that one of these people becomes important. I mean, what is the real cost? And you got a mentoring candidate. You just surveil 300 million Americans and just say, you know what, we'll take our shot. I mean, it's going to cost us a few billion dollars a year in storage. Who cares? Yeah. I'm not like, is there really a case that what they're doing in the TikTok app? I don't know how much you guys have read some of the studies on what they are actually pulling, but is there really a case that what they're pulling is particularly different than what would be pulled by pretty much any other social app or photo sharing app on your phone?

There was some kind of insight that, hey, they were capturing the Mac address, but that was up until last November. After November, the app kind of refreshed and stopped doing that, and it was a hack that some number of apps out there were already doing. But my understanding is the way that they've built the app, it's the same kind of ad tracking type approach that a lot of apps are taking. I think it's a naive position that because we haven't caught them doing something to Ferris, that they aren't actually doing something to Ferris right now. if you look at what MBS did to Jeff Bezos sending that, I guess it was a movie file or an image that then wound up hacking his chat and his phone. I think they've built the software.

I think it's purpose built, whether it's WeChat or TikTok to have these backdoors. There's no way the Chinese government is not influencing that. Guys, look, if you had to bet, David, what do you think the odds are between zero and 100, with 100 being absolute certainty, that there are foreign national spies that work at Google, Facebook, Amazon, Microsoft. That's my point.

It's, is it, I mean, look, I think that there are. No, no, but do you think it's 100%? Oh, of course it's 100. Yeah. I think at every one of them, it's probably 100%. Yeah, at least one, you know, foreign national that has a connection to intelligence in China. Yeah, it's probably 100%. 100%.

100%. So my point is TikTok is 100% Chinese. So we don't even have to guess whether it's... My point is, like, if there is some, you know, access to personal data that we're all concerned about being compromised at literally every other fucking app company, we're exposed. Yeah, but every other app company is not connected to, you know. But the point that Chumach just made is that they very well could be. The fact is we as individuals have exposed all of our personal and private data to six or seven companies. I think you're saying to the really right thing. This is a canary in the coal mine for a bigger issue. This is why I'm saying, I think that, you know, Trump is probably acting out of an expression of power. But I think what we're realizing is actually this is about core fundamental privacy and the safety and security of each of us as individuals.

And it should start a bigger conversation. Like privacy, I really do think this. Privacy is the killer feature of the 2020s. You know, what David just said about, like, you know, if you're a Chinese ex-national, the idea. idea that you're like, look, I've been a citizen of three countries. The idea that the Sri Lankan government all of a sudden may not like what I have to say and can spy on me or, you know, root my phone or steal my data, it really disturbs me like, I'm sorry, but no, go fuck yourself. Like, I left that country for a reason. Yeah. So I think, I think the Republican to watch

on this is, well, besides Trump, I guess, is there's a center, Josh Hawley, who is, Crazy. Well, he's sort of a critic of big tech. And I think he's got some interesting things to say. But in this particular area, he is proposing legislation to regulate the types of information that can be collected by applications that are based in countries that are fundamentally hostile or adversarial to the U.S. And that to me seems like the right policy because, you know, it's not just about TikTok. It's about all the apps that collect information. on Americans that can be appropriated by, you know, the Chinese Communist Party or Russia or Iran, places like that. And so I think we need a more holistic policy here than just banning TikTok. And it may not be necessary to ban TikTok if you had the right limitations placed on them. But I do think this whole sort of compromised solution with Larry Ellison and Oracle,

that makes no sense to me, this idea that, you know, Ellison will own 20% of, of the company, but nothing else really changes. It'll still be based in China. A Chinese company, it'll still be Chinese engineers based in China who, you know, and they still own 80% of it. I mean, how does that really address the data security issue? Don't you think, David, that that's just basically a way of just, it's a wealth transfer to Larry Ellison, which I think is amazing. I mean, if I could totally. Yeah, it's bite dance. It's, it's bite dance. It's, it's bite dance, dance, it's bite dance paying political protection money to Larry Ellison to be their bodyguard in this political process. But I, but that's why I don't think it's going to fly. I mean, Holly has already

said that it's not good enough for him. And so even if I think, and it doesn't live up to Trump's stated criteria, even though he seems to be supporting right now. Is this ultimately a Sifias ruling sacks? Is that who's going to make the final call on this? Or does Trump have sole executive kind of authority on foreign security, on security, on security grounds? to kind of block it. Does it go to Sipheus? I don't know. That's a good question. I think Sipheus just approves M&A, right? It has to approve it, yeah. I mean, so you're right. I mean, there are members of Congress that are all going to need to be convinced to get this thing done. Well, but Sipheus approves M&A.

I didn't think they could like block applications. As of last year, as of last year, every investment triggers Sipheus. It's a weird new thing that happened. I was involved in a company recently. Yeah, but that seems secondary to the national security power that the, that Trump may have. So this is almost like a two-tier kind of thing. One is to approve, one is for it, you know, for Trump to be cool with it, national security terms. And then second is the antitrust issues. If we just go back a second, talking about the broad, you know, as Chimov called it,

kind of this canary in a coal mine, you know, I don't know how many of you guys use an Amazon Echo or a Google Home or Amazon Fire TV or a Nest thermostat. at every single every single one of them has ambient audio listening on it every single one of them even and another thing people don't realize is every speaker is actually a microphone as well as a speaker you can actually listen on any house speaker whether it's a sonos device or what have you um and so we've got uh you know our homes are already wired um amazon fire tv runs on fucking android um i mean that there is a hundred ways into your home as it is it seems to me like there there's a significant concern about how much data we are already exposing that's being highlighted here. I don't think that there's, you know, it's sort of like playing a where you try and pop the hamsters in the game.

It's like at some point, we're going to realize these things are here everywhere. And it's not just a company. But it is how we are living our lives now and how technology is kind of capturing every piece of information about everything we do. This is, this is I go back to this. Somebody will take this or many people will take this and run with it. But I think that there is an enormous amount of money that consumers will pay for the assurance of anonymity and privacy. I don't really know how it's expressed, David, but like, you know, for example, like, if I could get a phone that was completely locked down and encrypted and... Like a burner phone is what you're talking about, and like a lot of people are now doing this.

They take a second phone. They put a VPNs are the first step in all this. And you're seeing it getting very popular. Well, like I try to use Signal. I try to use FaceTime audio. I'll even use WhatsApp now just because these things are intent and encrypted. And I have nothing particularly important or interesting to say or hide. But I just don't like the idea that in the open wild, I just feel very vulnerable to data breaches more than any other kind of breach.

I mean, I had this conversation with somebody that was, you know, sort of helping me lock. down my Wi-Fi network. And for a long time, I only had one endpoint. And all of a sudden, he's like, look, let's have a home and a guest. But in that conversation, what he was saying is the biggest form of theft isn't like burglaries anymore. It's basically people just having packet snifers outside your house because they can get access to everything and anything.

Can I ask you a question? There's a book by a guy named Stephen Baxter, a science fiction book from years ago, and Arthur Clark called The Light of Other Days. And these guys developed a wormhole technology. They could put it in any house and they could see and listen to everything. And suddenly the technology became kind of ubiquitous. So everyone could create a wormhole anywhere and see and hear everything. So effectively, information was completely transferable and free and available to everyone.

And the book kind of highlights how society changed in that context. So in a world where you see where everyone is and what everyone is doing and saying, there's no longer any notion of information asymmetry. and the way people operate and behave changes because so much of our life is dependent on people not knowing things about us that we know. So when your employee is going to go interview for another job and they tell you they're going to the dentist,

you can say like, hey, that's not true. And the guy says, you know what? I'm actually thinking about looking for another job because I hate working for you, you suck. So everyone starts changing kind of how they behave. Do you think that 50 years from now, that's where the world heads? Do you really think it's possible to stop this train in its tracks

and not end up in a world of what I would call kind of like hypertransparency, where all information becomes kind of, because it's already being collected everywhere about everyone, and it's only rising exponentially. People are going to start, I think that people are going to start turning their homes into like those skiffs, you know,

sensitive compartmented information facilities. You always hear about like senators going into the skiff kind of situation for private stuff. I think like people are going to start taking this very seriously as they get compromised, you know, time after time and embarrassing. And you can see it with Apple making it their marketing strategy. Apple's marketing strategy. You don't think society changes. Oh, I think it will.

It's already changed already with people getting their phones hacked and their, you know, news being leaked. People are now being normalized that. I think it makes the world a much shittier place because it basically robs us of our own independence and our fundamental right to privacy. And I just think that's a really bad outcome. And so, you know what? like if if like the need for likes and tweets and followers leads me to a place where I lose

privacy, I would just say shut them all down now. Because I think that people's self-worth is much bigger than what they understand it to be if they're willing to make that trade off. But most people appreciate that. I would also I would also just add that just because there's more transparency doesn't mean that it serves the interests of truth. like Jason said earlier, this information can be used to create, you know, ops, you know, and manipulate. And, you know, it's, and so, yeah, I don't, you know, like Trotsky said,

just because you're an interested in war doesn't mean war isn't interested in you. I mean, this data can be collected to run operations on people that don't serve, you know, the interests of greater transparency or the truth. I think, I think people don't think from first principle, on this topic. This is sort of like the idiotic orthodoxy of Silicon Valley, which is like they wrap themselves in the flag of transparency like it meets something, but they have no real idea what it really means at scale and at the limit. And there's one thing about getting access to a fucking looker dashboard. Who cares? But the word transparency is used for that the same way that it's used for David exactly what you just said. And they're two completely different things.

They have completely different meanings. And the latter's implications, are so much more important. And we need to think about this from first principles because I think people's inherent identity as human beings ultimately gets put at risk over time. It should absolutely be the case that these social networks or anybody collecting data gives an op.

This is the way I would form the legislation. If you are running a service like Facebook, Twitter, Google, for free and you're monetizing through advertising, you must provide an option. Like what how they do provide? They monetize. They monetize. Oh, listen, if you're monetizing your service through advertising services,

then I think you should be forced to give a option for whatever the amount of that monetization is a year to pay as a subscription. So, for example, if Facebook makes $80 per person. You lost a, you lost this monetization, Jason. Sorry, I think let's, it's over. It's over. Next segment. Next segment. Next segment.

Next segment. All right. Well, just as we wrap up here on this segment, Kevin Sistram might, he's in the running, apparently, to take over for TikTok. Is that a good idea? Sachs, I think you know Sisholm. I think it's a pretty, it's a dumb idea unless the company literally becomes an American company.

I don't know why. You've made this point in the context of Kevin Mayer. Like, if, if. If he's working for Bight Dance, he's working for the Bight Dance board directors, which reports to the CCP. It's just, why would someone who's in his position want to sacrifice his independence to do that? Yeah, it makes no sense.

And this is becoming the big test on everybody's moral compass, especially Hollywood, which is changing the ending of movies to satisfy the CCP, like literally the people who are the biggest virtue signals in the world, celebrities, Hollywood. China knows how to use its market access. We don't. We just threw open our markets to their products, which caused us to lose our whole industrial manufacturing capacity. We didn't demand anything really in exchange for that.

Whereas in order to get access to China, you have to say and do the right things, or certainly to not criticize them. And so they know how to use, as we saw with the MBA and the whole Darry-Mor-Mory thing, you know, they know how to use their market access. All right, well, let's go on to the economy here. We've been sheltering in place essentially for six months. And now people are starting to talk about, hey, maybe we need to do another lockdown. And obviously, this economic challenge is being felt very differently.

In some places, it's an opportunity. Obviously, a lot of people with SaaS software and, people who work behind keyboards are having a renaissance and a lot of the economy is pouring into their keyboards while restaurants, retail, and anybody who has to work in the real world is part of what's becoming essentially a permanent unemployed class that perhaps this is starting to look like a dry one of UBI. What are your thoughts to come off on this permanent unemployment situation. I have a I have a bunch of thoughts here. Let me just go kind of give you the stream of consciousness. Like Jerome Powell gave a speech, I think it was two or three weeks ago in Jackson

Hole. And he basically said like, look, the Federal Reserve is taking a completely new posture on rates. And, you know, they basically clarified that in explicit detail just a few days ago. And they basically said, we're keeping rates where they are until at least 2023. You know, my personal view is rates are going to stay basically at zero for the next half decade. And I think it's probably pretty likely that we're going to see rates stay at zero, probably a full decade. So what does that mean? Okay.

Well, a typical recession, what happens is you don't know where the bottom is, right? Things sort of decay. They get a little bit worse. They get a little bit worse. They get a little bit worse. Then things bottom out. And then, you know, you start to grow. And you can use interest rate policy to kind of help navigate how soft the landing is, as well as how

faster recovery is. That's sort of like classic economics and how bankers and the markets and all these folks used to work, and it eventually would trickle into Main Street. Now we just have none of those things. We have rates zero. They're not going to go anywhere. They're not going to go up. They're probably not going to go down.

They're going to kind of just stay where they are. That's one thing. Second is we priced in the bottom, which was the first month of the coronavirus. We took the markets basically assuming, oh, there's no growth. and now we've priced things back as if they'll recover. The rating agencies are out to lunch. They basically said, you know what, I'm going to look out till 2021 or 2022. Give me a reason to justify not to downgrade you so that you can continue to raise more debt,

which, by the way, is free. So you have all these dynamics where I think the capital markets are in an expansive mood and an expansive mode. And in that, I actually think there's a real bid to employment because there isn't really that many ways now you can, without just getting completely ripped apart, put money to work. And so the real earnest capital allocation strategy that's left from most CEOs is to actually buy things, invest in things, try more things. And all of those, I think, lead to net employment. So in general, I'm kind of constructive and bullish. and I don't think that this idea that there's a permanent unemployment class

sticks around. Freeberg, what are your thoughts? Obviously, a lot of Americans work in retail. You know, we obviously have all these restaurant workers who are out of work and travel is now hitting the end of the furloughs at a lot of these different airlines, etc. What's your thought on this unemployment, Middle America catastrophe? Well, I don't think happiness comes from, you know, absolute standards of living. I think happiness arises from one's relative

standard of living, whether that's relative to how you lived last year or how you're living relative to your neighbor and seeing some progression over time is the only thing that keeps people happy. It's otherwise society decays. So the notion of some sort of flatlined or even flatlined at inflation adjusted, basic income level for a large number of people will inevitably result in kind of what we're trying to prevent, which is, you know, some sort of decay, societal decay. We have to resolve the opportunity framework for people, which is how do you give people an opportunity to kind of progress in their lives and earn more over time and have access to, you know, doing more with themselves while they're here on planet Earth. I mean, that's just what humans need. So, you know, maybe there's a

short-term fix, but I think we've got some structural things to fix to kind of enable opportunities and give people kind of an inherent, you know, kind of step ladder in life. I heard a really dark theory a few years ago, which is if we do this, we're going to resolve to a world where we're going to have a bunch of people playing video games because then the only way you can get people to feel like they're progressing in their lives is to give them more medals on their video games and give them a higher ranking and score. And that's where society kind of gets to to kind of keep people psychologically kind of satiated.

And it's a pretty dark, you know, sad place if that's where we end up. It's like a bad episode of Black Mirror, but we've had a few episodes of Black Mirror this year. So, you know, we'll see. Sounds like Ready Player 1 with a Masters. We're playing video games instead of actually going out in the real world. That's right. Totally. Sacks, what's your thought on, you know, just the next two years, let's say, and how this

all shakes out, and this will give us a good segue into the coronavirus and where we stand right now with this potential second lockdown and the impact that might have psychologically on people and also on the economy. There's not going to be a second lockdown. It doesn't make any sense, and even if there were people aren't going to support it. Certainly any of the red states aren't going to do it. I guess the blue states may, they still haven't, you know, sort of unlocked down. so maybe that gets more protracted in places like California. But we're not going to go back into lockdowns and people won't support. And I think the thing that we basically figured out that should have been obvious months ago now is that coronavirus is really like two different diseases in terms of its effects on people.

So for elderly people and for people with risk factors, it's very dangerous. You know, I'm very worried about my parents. And, you know, for people in that group, they have to take, you know, extreme precautions. but for young healthy people without risk factors, it's not been that deadly. It's very unpleasant. It's a very bad two weeks. But, you know, for example, if you look at the data now on colleges coming back, there's been some reports that the virus is spreading like wildfire on college campuses.

That's true. But hospitalizations and deaths have not gone up. And so because it's just not that deadly to younger people. And so I think this idea of shutting down the whole economy to protect people at risk is just seems like overkill. And I think if we had to do it all over again, we wouldn't have done lockdowns. We just would have protected at-risk people. We've still consistently had a thousand deaths a day. We thought this might go down.

What are your thoughts on Americans just being okay with that basic death toll sacks? Well, I mean, any deaths is obviously bad and tragic. And, you know, and statistically there are going to be people who die even who are in the, you know, loaders group. So for sure. But, you know, but we've had about 200,000 deaths. The original estimates from this virus were two to three million. So it's, I guess my point is not that it's not bad, but it's, you know, but that it's, you know, much less deadly than I think was originally thought. There's an argument that that's not deaths directly attributable to coronavirus, right? and that the vast majority of those folks had comorbidities and that, you know, the primary driver,

this is an argument many have made. I'm not going to take a strong point. But, you know, 85% plus of folks have significant comorbidities. And, you know, this virus maybe kind of has a contributing factor to their death. But if let's assume everyone in the United States had coronavirus today, then every death that was reported today would be reported as a coronavirus death. And so they're testing a lot of folks, you know, in the hospital finding that they have coronavirus, it's very difficult to then prove that the reason that they died or the sole reason that they died was coronavirus. If you had to pick a percentage for you, where would you put it?

Half of all deaths, if you just had to guess. But that's my point is I don't think it's one thing, right? I'm not sure that it's someone goes into the hospital with coronavirus and they've also got severe diabetes, heart disease, cancer, they're on chemotherapy. I mean, you could list the other things that they might have. What caused their death? You know, you can't, as a corner, it's very difficult to say this one thing caused the death. But when they test that person and they find that their coronavirus positive, that number is now being counted in the statistics that say that was a coronavirus death that day. And coronavirus is so prevalent in the United States right now.

It's such a significant part of the population. It's also very difficult to say, hey, guys, like, you know, these deaths are, so I'm not trying to belittle the fact that people are absolutely dying and they wouldn't have died if not for coronavirus. That is absolutely happening. But it's very difficult to say what is the net effect on life right now. We're still learning a lot about how this virus interacts with different people based on their genetics and based on their disease state and other factors. Let me ask you one more way for you, Freeberg, and then I'll give it over to Chmoth, which is Freeberg, in your estimation as a scientist and somebody who's a, I would say, a man of science, on the call here.

Are you optimistic about us coming out of coronavirus in 2021 and what's your best outlook for a return to normalcy? If you had to pick a time when it feels like we can go to a Warriors game or play cards regularly or go to the World Series of Poker, Wendy, do you have a time period where you think that could possibly happen? It's all politics and social behavior. It has nothing to do with science. Like after 9-11, there were no more serious, like, terrorist attacks on

the United States, but our fucking lives changed dramatically. We go sit in TSA lines and, you know, get our asses swabbed when we get on an airplane now. And that's still going on 20 years later. So I'm pretty sure there's a lot of change that's here to stay in the U.S. because of coronavirus and will be even after everyone gets vaccines and the deaths drop below 10 a day and yada yada. So, you know, I'm not convinced that this is like, hey, here's the date. We're all going to be out of it and then we're safe because people are psychologically scarred. Behavior has changed. Businesses have changed. The landscape of how we work as a society has changed, and that's not going away. So it's not like we're going to go back. I think it's like we're going forward into a different

world where we operate differently, much as what happened after 9-11. What's your take on that, Chimap? I think that David's right that, you know, were it but for coronavirus, I think a lot of these people that died would still be alive. And so, you know, I don't think it really matters how much of the blame we're trying to ascribe to it. It's just that it was a meaningful, non-trivial contributing factor. So these deaths are avoidable, and we have to deal with that. The second is, I don't think what we know, what the peak to trough looks like, because we haven't really gone through a real, full-blown flu season yet. You know, coronavirus came to America at the tail end of the winter. And it's going to be, I think, tough to figure out what it's going

to do in October, November, December, January, February, when it's really cold in many parts of the United States and, you know, whatever effects, again, we still don't know it in totality, but whatever effects the warm weather had in muting it or whatever mutation muted it may change. So I tend to think it's another 18 to 24 months of this posture. But Friedberg is really right, which is like, this is what's so sad, which is when you could point a finger and look at somebody and say, you, you're the cause, it was much easier to react and create rules and create balance. boundaries as uncomfortable or as inconvenient as they were and lived by them. And because this is more

nameless and faceless, it's impossible. All right. Well, here's some good news. I was able to acquire. I've been on a little investigative journalism kick asking people if they have access to rapid testing kits, i.e. they have them in Korea. And I was able to get, and I'm curious your thoughts on this, Friedberg, the rapid response Liberty COVID-19 IGG slash IGM test cassettes. And they cost 15 to 20 bucks each and they take 10 minutes. They're easy to use. I mean, I've had those since March and they cost 50 cents each. So these are now officially available though in the United States.

You had those from some other country, correct? I got from China and I got from the U.S. and I got from Korea. And these things are just made everywhere. And they're like, these are the anti-biased. Are they accurate? Yes. Yeah.

So there's a paper that was published at UCSF. I got an acknowledgement because of my donations to support the research. And it showed that these tests have actually very good specificity. And the sensitivity is going to be, call it, 85%. but these are antibody tests and further research has shown that not everyone has the same antibody response after getting infected and there's a relationship between how severe the disease is for you and various other factors. And these will only show up typically, you know, days to weeks after you get infected. The antigen tests, which are the more common kind of ones that everyone's looking for

now, are these tests that can actually find the virus itself. And so they'll take a swab of your nose or some saliva from your mouth and see if there's any virus in there. And it's a much, much lower sensitivity than the PCR test, which is the expensive, you know, lab test. But it can be done on a stick and it's a good enough thing for letting people in to say a football game. And a good friend of ours just texted me and told me that they're doing this at the UT Austin game. They're using this antigen test to let people into the football game today. So, or this weekend. So it's getting kind of more widespread use. And so when we have those tests that scales, what will the world look like, Freiburg?

I don't know. Just like the TSA, you'll get swabbed and, you know, these things. It's great business to be in, by the way. If you guys, you know, want to spack a Korean antigen test business, these things are going to sell like crazy. There's a company that I heard of through a friend which had, it's an Israeli company. I never followed up on it, which was effectively a breathalizer, which would be, could you just imagine? would be incredible, right? You just breathe in a few seconds. We've talked about this in our chat group. There are startups like, was it, Quedell, Hamodius, Q, who've got these little, you know,

$2,300 little handheld readers and the cartridges are basically mouth swabs or lower nasal swabs, you know, cost $10. And I think, you know, I think they're going to be rolling out over the next few months. And assuming we can scale the production of them, I think they will be everywhere. And, you know, I don't think it'll be a government mandated thing. I don't think the government will get its act together. But it'll be the kind of thing where you go shopping at a store or whatever and there'll be early adopters or a restaurant. They'll start using it.

People will realize, well, wait, I don't want to get swab three times a day. So then they'll get some sort of like receipt or voucher they can take with them to the next place. And so I think, you know, I'm like actually like, I think I'm more optimistic than you guys about COVID right now. I think that whether it's because of these rapid tests or because of treatments coming. or just this fundamental fact about comorbidities. Again, not absolving, not saying that COVID isn't serious,

but this is the fact that we've learned that it's, you know, that it's really deadly primarily for people who have comorbidities. I think for all of these reasons, I think COVID's going to be a distant memory by next summer. I really do. I think, um, I think, behaviorally too? What's that? You think behavior changes as well, like businesses and movie theaters?

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