All-In with Chamath, Jason, Sacks & Friedberg - E53: Wealth tax, inflation as a capital allocator, big tech earnings, paternity leave & more

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Guys, isn’t it amazing how people in power

cannot take any time off and still remain in power and engaged when you have a baby.

J Cal, what’s the reference?

Okay, our friend Joe Lonsdale, venture capitalist living in Austin, had a tweet that went viral,

but maybe not for the best reasons. He said, in response to a Dan Primrack tweet,

Dan works at Axios, who was talking about Joe Rogan criticizing the amount of time

Buttigieg was taking on paternity leave. And Joe Lonsdale responded, Wow, great for

fathers to spend time with their kids and support moms. But any man in an important

position who takes six months of leave for a newborn is a loser. In the old days, men

had babies and worked harder to provide for their future. That’s the correct masculine response.

Well, it was an opinion from 1957. That’s either his or

the way back machine. But Joe’s old school, Joe is a unique individual. And he just happened to,

I think, in this whole, like, not get canceled debate, or don’t let yourself get canceled debate,

the right is now saying, like, I’m just gonna tell you how I actually feel.

And so Joe told us actually how he felt.

I don’t think he said anything offensive. I think you can have a different opinion than what he

said. But I don’t think he said it shouldn’t exist. He said, if you’re in a position of power,

and you check out for six months, it puts everything that you’re doing under a lot of

pressure. That’s, I think what he said, and he called those very specific people losers.

The context is Joe Rogan called up Pete Buttigieg. Because Pete Buttigieg had two kids via surrogate.

And I guess it’s taking six months, or I don’t know, I don’t even know how much time he’s

three months, but nobody knows if he’s like working half time, but Rogan had an issue with it.

And then Dan Premack basically said, what Rogan doesn’t know is at his own company,

ie Spotify, there’s a six month policy, which, by the way, Joe Rogan does not work for Spotify,

based licenses show. So there is no way for Joe Rogan to know the internal policies. He is not

an employee. I mean, Jason, if you want if you want to hang your hat on that little fig leaf,

okay. No, I’m just saying it’s I’m not defending Joe. But I’m also saying like,

how would he know it’s not like he went to HR and was like, Hey, what’s our paternity?

He doesn’t work there. Yeah, fine. Well, six months is a long time, especially. I mean,

that is a long time to take off. The word loser is a very strong word. Do you think men who take

paternity are losers? No, no. I mean, it’s their man who takes six months of paternity.

No, I wouldn’t. I wouldn’t actually call him a loser. I do think that is a long time for somebody

who, you know, prioritizes work. I mean, if an entrepreneur took six months of paternity,

would you would that influence whether or not you invest in his business?

Well, look, if you are the principal of a business, and you just disappear for six months,

that’s not going to work. I mean, let’s be realistic. Unless it does, in which case,

then you have other problems. Well, or look, if you’re at like the stage that Google is at,

or whatever, the founders can disappear and move to, you know, islands and private islands. And

it doesn’t matter what they did. But But look, we all know, I mean, that when you’re a startup,

you face existential decisions, daily, weekly, or monthly, you can’t just disappear for six

months, it’s not going to work, you might only have six months of runway. So if you did take

six months of paternity, there would be no company when you came back in all likelihood.

Let me speak for myself. I couldn’t ever take six months. I’ll, I’ll probably take three weeks

to a month. And honestly, I agree with David, I really didn’t do much of anything that had to do,

frankly, all of this by herself. And so I’m there to just be moral support and help where I can,

you know, baby needs a diaper change, I do that. I’ll hand feed in a bottle because she’s tired

of pumping and, you know, breastfeeding, like, but I am so peripherally at the edges trying to

help and be relevant and try to give her a break here or there. That’s my role. And at some point,

when the kid gets on a schedule, there’s even less stuff necessarily for me to do other than,

again, just be moral and emotional support. Then, of course, there’s bonding and stuff. But,

you know, to be honest with you, like, I have found as a parent, the connection that I have

with my children has gotten meaningfully better as they’ve gotten older. And maybe that’s just a

limitation that I have and my need to communicate and how I want to connect with my kids and how I

feel I get feedback back that gives me energy to be a parent. It is much easier for me

to find that equation with my 12 year old than it is with my, you know, two day old.

So that’s just me, you know, I’m going to be out for three weeks to a month and

the other thing we’re leaving out here is the question of resources. So Joe Lonsdale,

according to his podcast, is a billionaire, his podcast title. And so if you’re a billionaire

and you have unlimited resources at home and 24 hour night nurses, which, you know,

we all know what those costs, you’re talking about $1,000 or $2,000 a day to have 24 hour coverage,

but that’s nothing to a billionaire. So if you, I don’t want to make it about class, but

if you were two working parents, and you didn’t have the money to hire somebody,

this is actually practically the only thing you can do. Somebody has to be with the kid. And

it can one spouse be at home, you know, I’m 24 hours alone with the kid all the time.

As you guys know, I’m from Canada. In Canada, we have a one year

maternity and paternity leave policy, it can kind of go both ways that basically the family gets it

and you can allocate it as and how you need it. And it pays for the salary, the government

basically guarantees your job, you go on effectively unemployment insurance after

some period of time where you go from 100% of your salary to about I think it’s 50%.

Somebody will correct me if I get these details wrong. And then you go through the rest of the

year. Now in both cases by my sister, you know, when she had both kids, you know, on the way in,

she was like, I think I want to take the full year. And by the six month mark,

she was losing her mind. And you know, she’s a lawyer at a really good research hospital. And

you know, she does work that’s really valuable to her and that she finds really stimulating.

And she just needed more adult connection after six months. It was very hard for her to kind of

be there. Yeah, I just think six months for the second parent is that seems like a long time.

I don’t think I could take six months off. But I also think if you have resources, there’s

pockets of time, even when I did stay home for, I don’t know, the first couple of weeks after the

kids were born. Yeah, they’re asleep for three hours, and then you clean the diapers, feed them,

they play for an hour or two, and then they go back on a nap. You know, it’s like,

it’s constantly the stop and start. I mean, that’s the thing that’s hardest about is the

lack of sleep, I think. Oh, my God. It feels like I mean,

it’s funny, but like, I forgot what it’s like. But you know, you’re reminded quickly.

It feels like you’re drunk. Yes, two hours, you wake up, you get a 10 minute catnap, you wake up.

And this is where again, I go to and I’m such a bit player in this play right now.

You know, at the edges, we’re like not sleeping, I can take care of Tali. But I don’t know how

women do it. It’s, it’s incredible. And for those of you listening,

Chamath has got his newborn on his chest. And swallowed quite nicely there.

This is why you should subscribe on YouTube. And you can see you can see that he’s using his

new daughter to get the YouTube subscriptions. This is good. They should blow us past 100,000.

How do you feel so special? I feel so lucky. I feel so so lucky.

This is gonna be the most popular cameo on the pod since Freeberg’s dog.

Yeah, I mean, she this chick is so deliciously cute. She’s so she’s so delicious. And I forgot

how beautiful the sounds that girls makes versus boys having three boys and two girls. Now.

I remember the boys, they make kind of interesting noises, but not really.

But my gosh, like little baby girl noises. And you guys access to girls, you have three,

three girls. It’s girls are incredible. We’re all basically girl dads like Oh,

so what a blessing. What a blessing. I feel really lucky news on your front.

Well, we had a baby the day after tomorrow at a baby.

There were all right. I just did. Yes. Congratulations.

Thank you, Freeberg. Where’s your swaddled infant? You’re letting you’re letting Chamath

win sweepstakes here. What’s going on? Yeah, he’s vacuum is on the way.

I haven’t. Are you in the Joe Lonsdale? You did one day off and then went back to work.

She’s in the place where you drop the kids off to get raised. And then you pick them up in a year.

Okay, you’re like, Oh, you mean like Vulcans? You’re like Vulcans. We have

Vulcan into a learning pod and come back a year later.

I mean, they sleep most of the day. So she’s asleep right now. Actually,

Allison just sent me a picture. She’s sitting on the rocking chair where they’re outside right now.

Pretty amazing. I give Lonsdale a lot of courage for saying what he thought.

I really don’t think that what he said was altogether that like vilifiable. If that’s

the word you want to use. I think that there’s a lot of reasonable points of view. He could

have maybe use better language. But I think where he was coming from, I think a lot of us probably

wouldn’t do it ourselves. We may never judge anybody else. I would never judge anybody who

takes six months. I know that I could not I would just I think either I’m too selfish or whatever.

But I’m not sure there’s just that much to do as the secondary. And to David’s point,

if I was asked to be the primary, I think I could probably step in and do 10% of what Nat would do.

Here’s Joe Lonsdale, super blind spot. He made this very gender specific with men and women

in certain roles. And he basically is saying, you know, a man who takes six months off is a loser.

So he is not just giving his opinion, he’s attacking people who do take the time off.

And then he says, Listen, in the old days, men had babies and worked harder

to provide for the future. That’s the correct masculine response.

So I think what triggered people about his response, and perhaps rightfully so is that

this is just a video. But Jason, here’s Can I say something like degrading men who take

time to take care of their kids? But look, we’ve talked about this a lot.

There’s an opportunity for folks like us to take a step back and slow down and how we interpret

a tweet that’s written at 8am in the morning super quickly.

I’m not advocating he’d be cancelled.

And not and not just him, but everybody else. But like, there is an opportunity to teach

empathy here where I’m not saying you have to agree with him. But you can also choose to see

what he’s trying to say through the exact words that he use, decide that you agree or disagree,

and then just move on. Of course, you know what I mean? And and I think that the reason why folks

may want to do that in this case, but in most other cases, is eventually it will be you that

makes a mistake. Sure. And you want to be let off the hook by other people that are empathetic

enough to say, I really disagree with what you’re saying. But you don’t deserve to be punished beyond


I love what your mouth just said. You know, the mistake that we make might even be on the spot

today. I’ve already made it. I agree that we should all just be a little bit less judgmental.

And there, there, there, there, there is an element, there is a judgmental element in Joe’s

tweet that that’s probably the part I don’t agree with is, look, if someone wants to do that, fine,

take the time doesn’t actually make them a loser. But it’s not a choice that I would

realistically make. Yeah, it’s totally unrealistic.

It’s not even startups, like, you know, I’m getting these, I’m getting put to these

multi hundred million dollar decisions a day. I can’t, you know, I could pause the business,

but that’ll have so many downstream implications. Unfortunately, I picked a job where I’m in a

position where I can’t check out even if I wanted to. So I try to do my best.

That’s the point he was trying to make that wasn’t that well articulated. I don’t think

any of us are in a situation where we can straight up walk away from work for any meaningful time. I

mean, on a daily basis, it would destroy my business. Yeah, we get texts, we get emails,

we get phone calls that we have to answer. And so it’s not it, you know, almost definitionally

isn’t an option to just walk away. But for those who it is, and if that’s their choice,

that’s what it is. The great thing about freedom isn’t that you can say whatever you want,

it’s that you don’t have to listen to what anyone else is saying. And you know,

that disagree with Joe, I feel like you always have the option to not listen. And you always

have the option to walk away and unfollow. And the whole idea of cancel culture and,

you know, punishing people for the things they say, regardless of what they say,

and the censorship and all the shutdown of voices and channels for people to have a voice.

I think it takes the freedom away that’s inherent in the idea of, you know, your choice to not

listen. Yeah. And it’s almost always totally hypocritical. So just as a postscript on the

whole Chappelle debate, it turns out that the leader of the anti Chappelle protests,

who’ve been trying to get him canceled at Netflix, it turns out this, this person

has like a treasure trove of the most angry, hateful, vile tweets that I or anybody has

never seen. When you put it in the group chat, I thought that that was a joke. The

things that she wrote were so beyond the pale beyond. Oh my God. They’re like,

they’re like the worst 20 of them on the show. No, we can’t. I don’t even want anybody to speak

these things. I don’t want to include it in the show notes. They’re literally the worst tweets.

They’re the worst tweets I’ve ever seen. Seriously. Like completely racist. Like,

I’ve never seen such explicit racism in the 21st century, basically, aside from these tweets. And,

and this is a person who’s trying to cancel Chappelle was out there with the megaphone,

and who the press was fawning over, by the way, and she said in her thing,

yeah, those were from a long time ago. I’ve already owned up to those. So let’s

wait. But owned up how owned up how? And it’s kind of like, you know, let me play the empathy

card on me. But then, you know, I so meaning I expect you to see through what I’m going through.

And that those expressions were in a moment in time. So see past them and see my true character.

That’s what she’s asking. That’s what she’s asking the world to do, you know, about her.

But then you’re not willing to do it to any for anybody else. And that’s where I think that double

standard just doesn’t work anymore. And I think this is what people are getting really fed up with.

Yeah, yeah. And I would also say that her tweets weren’t funny. They weren’t attempting to be

Oh, my God, they are so gross.

I have a customer service problem with this beeping beep.

No, they’re so bad.

I want to bash I want to bash this, you know, beeping,

Asian or whatever, over the head, blah, blah, blah, blah, like a lot of racism towards Asia,

you know, Asian people.

No, there was homophobic tweets. There was a Asia, Asian hate tweets. I mean, it Latina,

Hispanic. I mean, it was

She wasn’t even trying to be funny. That’s the thing. It wasn’t even it wasn’t even a

failed attempt at humor. So you hear you have Chappelle, who I think is dishing it out in an

equal opportunity way, making, you know, funny observations about really, he’s criticizing

our culture, not specific groups. And he’s being deliberately misinterpreted

by the people who want to cancel him. They’re really to think that Chappelle’s

standup routine is hateful really requires, I think, deliberate

obtuseness, you have to deliberately misinterpret what he’s saying.

And so you have these people out there trying to do that. And meanwhile, they are guilty of that.

It’s a total act of projection, because they are guilty of everything they accused Chappelle of.

Well, not all of them, this person in particular,

the leader, the leader. And of course, the press doesn’t dig any of this up. It all happens through

the through kind of internet sleuths.

That would be a narrative violation, David, if somebody is virtue signaling, and they are

leading a cancellation movement. It’s, it’s kind of a narrative violation to say,

well, they maybe they should be canceled by the same standard, or, you know, quite easily. I think

the thing that I don’t think she should get canceled. Let’s just let’s Yeah, I don’t think

she should be canceled. But I and this when she was drunk, nervous. I can only imagine that the

difficult path that this lady has gone through. And on the off chance that she’s listening.

I’m totally cool with your journey. I understand you made some mistakes. We’ve all

I’m going to let you off the hook. Can you please try to let the next person off the hook?

I think that would be a nice place for everybody to aim to go and then

and just to circle back with with Joe, when he started explaining himself in the thread,

when it became a conversation with a wider group of people, the journalists went on the pure dung

cancellation route. But then there was actually a productive discussion about between CEOs, etc.

And I thought what was very interesting about it was he started talking to Gary Tan, who,

you know, was like, listen, we have a four month leave practice at our venture firm. And Joe said,

do you really take 100% off cold turkey? Or did you work part time and stay in touch like a

responsible leader of your firm? And of course, Gary did just that, right. And then Joe says,

you know what, I shouldn’t have written loser and appreciate the pushback in more intensive

operational context, losing key leaders cold turkey for six months seems unnecessary. But I

respect the different takes here. And I think that really is an actual good discussion about this is,

hey, well, maybe if you’re an intense leader, and you don’t have the ability to take a couple of

months off, well, maybe you should take a couple of Fridays off. And then there was a really

interesting discussion. What’s better for a leader to do, spend a little more time every year,

or to spend three or four or six months in the beginning when you’re, as you just said,

Chamath on the periphery here and trying to be helpful on the margins. Maybe for the secondary

person, if it isn’t 5050 sacks, it is actually better for you to pick up some Fridays or

whatever, and take over the whole

I’m glad you read that clarification by Joe, because I think what he basically is saying

is that, yeah, he, the initial language he used, he would he basically clarified that.

And it sounds like what he’s saying is, listen, if you’re on a high performance team, and you’re

the star player, and you disappear for six months, that’s going to cause your team to lose.

So I think that’s maybe what he was saying.

That’s a perfect analogy sacks, because if we were looking at LeBron James or Kevin Durant,

and they had a baby midseason, or Draymond had a baby midseason, which I’m sure has happened to

you know, folks, it’s not like they say, I’m not playing the next six months of games,

they miss one game, maybe two, they go back on the road. And I think everybody understands like,

yeah, you can’t give up one of your 10 primary years or three years left that LeBron and KD

have left.

I’ll give you one final anecdote to end this chapter of our discussion today. 2007 at Facebook,

at one point in like one of the umpteen reorgs we were doing as we were trying to get out of the

primordial ooze, I was in charge of HR. And everybody at that company was young, except

for a handful of people. And then there was finally a person. And I think it was our this HR

person that that at some through some weird convolution of events reported to me who got

pregnant, who was pregnant. And we didn’t have a policy because nobody had ever gotten pregnant

before. And, you know, I remember saying, Oh, we have to come up with a policy. And what I did was

I was like, well, what would I want? Which is the easiest way for me to answer most questions.

And I came up with four months for either the father or the mother, irrespective of the context.

And that’s how we started the original policy. Four years later, though, when I had my first kid,

I took like three weeks and it came back because the grind was too hard.

Yeah. All right. I think I think where we have to go is it’s been a crazy week of

the reconciliation bill, the infrastructure bill and how to pay for this incredible spending.

It’s been a meta week.

It’s been a meta week. I mean, and this builds on top of our discussions about inflation,

as well as the supply chain issues that builds on the conversation we had about COVID and the

new president. So we’re trying to get the wealth. We’re trying to get the reconciliation bill done.

And part of that is, hey, how is this going to get paid for? And in the course of one week,

we’ve seen the tax proposals flip, I think multiple times to ones that have never been

tested and may not even be legal in the United States. Of course, I’m referring to a billionaire

tax, which was proposed, which would be a penalty or a tax on assets that are liquid,

but that have not yet been sold. And it would look back three years, essentially going after

Bezos or Elon, Larry, Sergey, basically going after the top 10 billionaires in the world.

And then maybe it was going to be the top 700, then it became a millionaire tax,

all of this to try to pay for these bills. While so much money has been poured into the system

that NFTs and stocks are going through the roof, where do we want to begin gentlemen? Does anybody

have thoughts on this brief billionaire tax that was floated and what that says

about where we are as a country in terms of how we think about the success of our greatest

entrepreneurs, we want to talk about what’s fair, or the process?

Well, I thought the process was insane. And what was crazy was that, you know, Ron Wyden had been

working on this proposal theoretically for the past two years. And at no point did he bother to

float the trial balloon with his colleagues in the Senate to even see whether these people

to even see whether these people actually supported it, beyond some folks on the progressive left,

who are ideologically fixated on, you know, this confiscatory way of running the country.

The funniest thing about that bill to me, and I let the powers that be know this is,

hey, guys, I’ve always been on the record, I’m happy to pay whatever tax you want,

I feel super blessed to be in America, whatever we want me to pay 30% 80% I don’t care.

But I had a real issue with the way that bill was written, because I’m like,

the democrats are writing a bill that will disproportionately tax democratic,

successful billionaires. And it’ll leave intact the coax, who is literally the boogeyman to the

progressive left who wants to write this bill. And I thought, how could you even write this

bill this way? It is so stupid. You’re saying because those people own private assets,

and this goes out guys, guys like me would have been paying billions of dollars. And the coax

would not have paid zero because their entities are private. Yes, or public? Yes. So the audience

understand? Yes. How insane is that? And yet we’re the ones that is a great second order observation.

So people clearly didn’t think through that was my only issue with the thing. It’s like,

if you want to try to ram and jam this thing through, go ahead and try. I’m not going to be

the one that that, you know, files a lawsuit the day after it’s passed, and takes it to the Supreme

Court, which will get heard. And, you know, this conservative Supreme Court would not have allowed

this, this tax to stand, you can’t target 700 people. But by the way, the reason you can’t

target 700, because there’s a slippery slope from 700 to 7 million to 70 million. And what it does

is it allows tax and spend politicians, a blank ledger to go absolutely crazy, and just fund every

single harebrained pork barrel scheme that they can come up with. And that’s really what we stopped

was an important slippery slope. And then in its place, I think is a tax that is fair. A simple

surtax on adjusted gross income. If you’re above x, you pay 5 million. And if you’re above y,

you pay another three. So 8% 5% percent on every kind of income. And I think like, that’s a really

reasonable way to get folks to pay more. That seems like a good start. But the first version

of the bill was so stupid. And the thing that really anchored me, though, was it targeted

democratic successful people, and left alone republican successful people written by the

democrats freebird, what are your thoughts on the confiscatory nature of this? I’ve never heard the

word used that way confiscatory, where we’re going back and saying, Listen, you want so much,

we’re just going to take 20 or 30%. We all pay property taxes. So we there is a

experience we’ve all had with paying a percentage of some of assets that we own,

people of all income brackets every year to your local government, to fund local services that

everyone participates in. So, you know, I don’t think it’s unfounded. Now, if you look at history

as a guide, you know, France introduced a wealth tax to people making over, I think it was 1.3

million euro per year. And it was shut down and came back basically 1999 2000. And between the

year 2000 and the year 2016 25% of millionaire households emigrated out of France during this

period. And the amount of tax revenue that was lost during that period of time was greater than

the new revenue generated from the wealth tax that was introduced. And so France ultimately

scrapped the wealth tax. And there have been a number of other, you know, reasonably good

examples of European countries putting in place these wealth taxes, and then kind of removing them

later. So, you know, on the one hand, I think that we’ve all seen this experience and Switzerland

does this, I think you get taxed on your total assets in Switzerland, you have to go negotiate

every year, with respect to how much you pay, it’s a very weird process. So on the one hand,

there is this kind of experience and precedent for paying some percentage of assets. Sometimes

it’s a targeted asset, and sometimes it’s not. But the longer range consequences that we’ve seen is

like, you know, emigration, and people realize there’s always a better choice. The chat, the

question we have in the United States, if we introduce a wealth tax like this, where will

successful Americans emigrate to? You can see how people could leave France and go to Belgium,

or go to the UK, or go to Switzerland, or go somewhere else where they might be better off.

Where are Americans going to move to? Canada.

You’re a successful… Canada? I mean, are you going to move to Vancouver? I mean,

you’re from Canada, but Zach, would you move? You know, where would you move to?

You know, it’s almost like there ends up being this kind of,

you know, I think, really interesting experiment that will be run here. Now,

remember, this wealth tax was introduced by Warren and others last year. So, this wasn’t

some new concept that was fly by night. This has been one of those things that’s been on the shelf

for a while. What happened is they pulled it down from the shelf and said, let’s try this now.

They’ve never had committee hearings on it. They’ve never had committee markups on it. It’s

been tried and repealed in European countries. And like you said, they pull it down on the 11th hour.

Why? Because their carefully laid plans, which they’ve been concocting for three months,

were thrown overboard when Sinema said she wouldn’t support the rate increases.

Now, I don’t know why they wouldn’t go to her at the beginning of the process instead of waiting

until the end of the process. But so, because of that, they’re scrambling around trying to find

any source of revenue. So, it’s, oh, well, a billionaire tax work? No. Well, what about a

corporate AMT? How about that? No. What about a millionaire surcharge? These guys are like

burglars, rummaging through the house. They hear the sirens coming and they’re like, what can we

take? Oh, the TVs are bolted down. Can’t get that. Where’s the jewelry? What can we take?

And it’s just, you can’t set tax policy this way. And this whole idea that we can set tax policy

based on our intuitions of fairness without having hearings to ask the question of what

will this do to the economy? How much damage will it cause? This is absurd.

I’ll say it’s really important to note, the market is telling Congress something here. And

the market is members of Congress informed by their, their constituents. The market is saying,

maybe we shouldn’t be spending this much, because there isn’t a place to fund it. And no one’s

raising their hand and saying, this is something we can all align on. And so I think the more

important fundamental question is, are we really equipped? And do we really have a general economic

interest, economic interest, meaning people measure things and vote with dollars to support

these sorts of social programs? And it seems to me the indication is no. And this seems to me to

be primarily a response of the pendulum swinging the other way, post the Trump era, where you know,

the Trump era was all about blowing up these ineffective, overregulated, bloated government

infrastructure and programs and people and, and bureaucracies. And now we’ve kind of found

ourselves through our voted representatives swinging this other way. But it turns out,

maybe we’ve swung too far in the market is now voting and saying, this just isn’t a playing field

we should be on. And so you know, where they end up here, I think, regardless, it’s gonna end up

needing to be some sort of reconciliation on spending to make this all work.

Let’s be honest, Bernie Sanders and Elizabeth Warren were did not win the nomination. The

country specifically wanted a moderate Biden was sold as a moderate go back to the way it was

moderate Dems, like Clinton, like Obama, this is the classic Coca Cola, this isn’t new Pepsi

nonsense. And we got hoodwinked, basically. And I think what a lot of democrats are seeing now,

especially the moderate ones, is, hey, wait a second, Biden is Warren and Bernie in sheep’s

clothing, perhaps. And we didn’t want this, this, we didn’t want Trump, he was too hot.

And we don’t want this to left crazy. Let’s just take everybody’s money randomly change the tax

code. I don’t think American citizens want to live in a world where we change tax code at the

11th hour. That is scary to people, all people, people who have savings if you care about the

economy. But I think these progressives so so it used to be that taxation was a necessary evil.

You you you tax people because you got to pay for government and government programs. Everybody

hates it, but but you do it and you try to figure out the way of achieving the revenue government

needs in the least destructive way possible. But I think progressives now they’re so focused

and monomaniacal about this issue of income inequality, the fact that there’s some people

who’ve gotten richer than everybody else, that I think they’re willing to tax those people.

I mean, they would like to siphon off money from those people, I think they would siphon it off

just to light it on fire, just to level people. And so they don’t really care what the impact

is going to be on the economy. Well, I mean, and it was in fact,

ban the billionaires, that was their roof. But you know, before we get to that, I just want to say,

these rules, I think Americans want the rules to be simple. And I don’t think people want you

changing the rules at the last minute, and then making them retroactive. I think all Americans

want taxes to be predictable and simple, not just change them willy nilly, because you change

the budget. This seems so unthoughtful and crazy. Chamath your point.

I have two points to make. The first is that I don’t think anybody really knows what’s in these

bills. And as a result of nobody really knowing what’s in these bills, they’re used as negotiating

chits. So case in point, when Biden came out and said, you know, we have a $1.85 trillion bill now,

and we’re ready to get this done so that he could, you know, fly to Europe, and, you know,

fly to COP 26, and kind of, you know, declare victory. Unfortunately, the progressive wing

of the Democratic Party in the house said, No, I’m not ready to dance yet.

And, you know, they have consistently refused to sign an infrastructure bill,

until they got what they needed from this other bill. And so when Pelosi called the vote,

she had to pull it, because they weren’t going to get the votes necessary to get this bill passed.

So what this says to me is that even with spending, it doesn’t matter whether you’re

spending five, because that’s a I think it’s a trillion dollar bill, right? That’s a $1 trillion

bill, this is a $1.875 trillion bill, nobody cares about the quantity. And nobody cares about

the details. They care about some perceived moral victory. This is the only reason why we’re seeing

this, you know, Mexican standoff that we’re seeing today, if these things were so substantively

important, we would have passed the first bill, we would have negotiated a reasonable second

version and pass that to instead, we’re here going through the end of the year with nothing done.

And I just want, you know, the democratic leadership who listens to this, because we

know a lot of people in Washington listen to this podcast. You guys got to get something done.

Because if you go into the midterms with nothing done, with a democratic president,

Democratic Senate and Democratic House, this is going to be a bloodbath.

Well, this is why something will will get done. But, you know, I think the political realities

are that at the end of the day, the democrats will come together and pass something.

But it’s concerning that we’re just talking about doing something because it will help you in the

midterms. You know, in the immortal words of Nancy Pelosi, you have to vote for the bill in order to

find out what’s in it. I mean, at the end of the day, we’re not even going to know what’s in this

thing. And, you know, we’re spending another, it’ll probably end up being a $1.75 trillion bill,

it’ll be stacked on top of the spending that’s already happened. One point, remember,

Biden already passed 1.9 trillion of COVID relief, another 1.2 trillion of infrastructure.

No, that hasn’t passed yet.

Well, it’s going to along with this now 1.75 million, sorry, 1.75 trillion

of this new social spending bill, assuming

right, so it’s about $5 trillion, $5 trillion wealth redistribution.

Progressives will have will have set the stage for this to be perceived as some sort of failure.

It’s by the way, David, if you go back, then if you take that 5 trillion and add it to the

all the COVID before and all of the, the Fed buying, we’ve probably had one entire turn of GDP.

So call it 20 to $22 trillion of money created in the last three or four years.


Now you go back. So now, so now you go back to Jason, what you started,

the thing that I have struggled with the most in these last few weeks,

is trying to come to a conclusion on inflation. My worry is that it’s here and it will be persistent.

And inflation comes in two ways. Way number one is if you massively increase the supply of money.

Why? Let’s just say the economy at $100. And now all of a sudden, you just print another 100. So

now there’s $200. What will happen is all of the goods and services that make up that 100

will get repriced to absorb the 200. So prices go up, inflation goes up.

The second way that inflation can happen is if middle and lower income people buy and spend,

because when rich people have extra money, they just buy financial assets. That’s why you get

financial bubbles. But practical goods and services are bought by average, everyday,

normal working folks, and their wages are going up. And so I think what we’ve created is a really

distortive inflationary cycle. That’s going to really hurt the United States, because as

Sachs talked about, we cannot print enough money to pay for the debt when interest rates go up.

This is the number one thing causing me concern as well is that you look around,

it’s all time highs for everything. It’s all time best everything. NASDAQ and S&P,

all time highs, crypto markets, all time highs, Shibu Inu worth $30, $40 billion bubble.

I’m seeing SAS multiples. Real estate.

I’m seeing SAS multiples at all time highs. So you have to wonder, is this a new normal? Is

this sustainable? Or is it some sort of inflated bubble? Then you look at the inflation rates,

5.1%. To Chamath’s point, it might be persistent. You look at treasury, the treasury interest rates,

the yield is 1.6% on the 10-year T-bill. So effectively, your real interest rate for savers

is 1.6% minus the 5.1% inflation rate. You’re at negative 3.5% if you just save your money

in T-bills, you take the risk-free return, negative 3.5%. So now you have everybody

going out there trying to chase yield, because how do you earn a return on your money?

You don’t want it to be… You buy stocks or NFTs or houses.

So people start going into riskier and riskier assets to basically try and make up for the loss

of inflation. And so you have to wonder… They’re trying to hit the one-outer.

Yeah, so then, okay, so you have to ask yourself, okay, so back to this point about all time highs,

is this because everything is really this great? Or how much of this is driven

by these sort of distortions? 50-50. I mean, I’m just putting a number

on it. Obviously, the industry and economy is doing fantastic, but it seems 50-50.

Here’s the other thing that I wanted to make in just the last portion, which is,

I think what we’ve realized as well, at the end of this, is I actually, again,

now to use this empathy card, I’m going to give the progressives my empathy card and say,

I understand what you’re trying to do. And I believe in a lot of what you’re trying to do

is to even the starting line for everybody. Right now, a lot of what you end up proposing

distorts that goal by trying to even out the outcomes and even the finish line. But I really

do think they want to even the starting line. But here’s the thing that we all have to realize

now. All the things that the progressives want to tax and fund are actually being done by private

corporations. And I think we just have to acknowledge that and make a decision about

whether as a society that’s okay or not. I’ll give you two examples. Number one is the federal

minimum wage. We have tried for years and we have debated raising this minimum wage. It still

sits today at $7.25. Just this week, McDonald’s moved their minimum wage up. Starbucks moved

their minimum wage up. We’re talking about, you know, entry level quick service jobs that now pay

17 to $25 per hour. Right, so two and a half to three plus times the proposed federal minimum

wage. And so what government didn’t and wasn’t able to do, the free markets have done. Second

example, we tried to get free community college inside of one of these bills, it was dropped.

Now, depending on where you go, the nation’s largest employer, Amazon, actually will just

pay you to go to college. Right? So they are replacing that intention and a version of the

GI Bill, but as a private organization. So I think what we also have to realize is that maybe

some of these policy decisions is actually a little bit of, you know, getting tilted by the

fact that private organizations are acting more nimbly to actually implement this progressive

agenda, because it actually exists in America, if you’re willing to take the time to look,

let me ask a question about inflation, if who is inflation going to hurt the most,

and who’s going to gain the most from it, because it does seem like consumables,

gas station, you know, supermarket trips, etc, are going through the roof. In that case,

you know, that’s going to have no impact on the top third of people because gallon of milk at

three, six, $9 doesn’t matter. But then you look at inflation on stocks, it’s going to make it go

up. So a rich person isn’t impacted by their gas or their groceries, but somebody in the middle

class or who’s poor, that’s going to dramatically impact them. So if we spend more, does that

actually create a larger wealth gap sacks like inflation is devastating for the middle class.

If you have savings, it if you can afford to put all of your savings and financial assets the way

that the super wealthy can, then your financial assets will go up. But if you have a good you

sort of middle class income, and you don’t have your in your savings or in something more

conservative, you’re going to get absolutely eroded by inflation over time, it’s going to

kill you. And, you know, housing prices will go up the the, the middle class young couple that wants

to buy a house for the first time, that’s going to be much harder to achieve, because housing prices

will inflate away. So I think, you know, there is there are some effects that are awash. So for

example, prices go up, and then wages go up at the same time. But savings can really get hammered

if you’re not in financial assets. It hurts the middle class first, but it also hurts. It hurts

everybody. Because again, unless you’re perfectly hedged going into a rising rate environment,

you will own assets that are just a good question.

Friedberg a scientific question here, are we starting to go into a self fulfilling prophecy

around inflation? Allah what happened in the 70s, which is, we’ve been talking about it so much,

that anybody who is thinking about raising prices as well, everybody else is raising prices.

So even if my grilled cheese sandwich hasn’t been impacted by all of this, and I didn’t have to

give raises to my employees, they’re happy at their current salaries, I’m just gonna put $2

on my grilled cheese. And we just get this cycle of everybody saying, how much can I add to the

cost of something I am trying to remember, there was an earnings interview I saw yesterday,

God, which was the company? Anyway, their company in the industrial supply chain,

and he said that they’re raising rates to get ahead of the supply costs going up for them,

so that their margins won’t get squeezed. And I think that’s, it’s almost like that,

what you’re referencing is a little bit of a run on the bank mentality, where those with

pricing power, raise rate raise prices. And as a result, you end up kind of seeing the trickling

effects because competition can’t catch up. So if everyone’s kind of raising rates, and there’s not

enough competitive advantage, the one thing that’s making this even harder right now is the gluts in

the supply chain, which are reducing the competitive market dynamics that we might normally see where

one customer raises, one company raises rates, and another company says, wait, our rates are

going to stay the same. But because so many people are challenged by getting product,

there’s enough demand for their product, everyone can raise rates together. We’re seeing this in

the energy markets now. So yeah, I mean, this is kind of part of the scary scenario that everyone’s

trying to manage against. So I don’t know what the science is. And I’m not an economist. But

it certainly seems to me, like the psychology of managers and business owners and boards is such

that they’re saying, let’s get ahead of the curve, let’s raise rates. And as a result,

you’re seeing the trickling effect of inflation throughout the whole economy. So I’m

both Gary sex, what do you think psychologically is going on with raising prices? Yeah,

so so expectations are definitely part of the inflation game. People raise prices if they

expect inflation in the near future. And then that feeds on itself. And that’s how if you look at

countries that have had hyperinflation, that’s how you get a spiral. Now, I don’t think we’re

gonna have hyperinflation here. But we’re at 5.1%. Now, if people think it’s going to be worse next

year, and the Fed’s not going to raise rates, it could even be higher next year. And I think people

are going to start getting upset about this. You know, when they buy their Thanksgiving turkey and

their Christmas ham, and those prices are way higher than they think, and they’re already

paying gas prices that are a lot higher than they’re used to. I think you could see a lot

of unhappiness out there. One of the thing I’m thinking about is, is the logical thing for a

person to do in this hyperinflationary, you know, market is to say, you know what,

these, I went to look at a car, and I wanted to get to drive in the snow. And I was like,

you know what, I’m just gonna hold off buying this because I’m not paying 15k over sticker.

So and I can pay for different series. I was like, do I want to do that? The other cars? Okay,

I’ll just put snow tires on it. So are a lot of people chemoth and as part of this psychological,

you know, spiraling out of control situation, then some group of people might say, you know what,

I’m going to opt out of consumerism. And I’m just going to lower my burn rate and stop consuming,

which is also bad for the stop consuming food. Now,

instead of getting, you know, filet mignon, you might get chicken.

Okay, well, there’s gonna be a lot of unhappy people who are eating chicken for Christmas

instead of like, I mean, serious, I’m coming to your house. I’m good. I’m gonna go your

house for lunch. And I’m going to mods for the surf and turf aft guys.

Rich people don’t create inflation. The middle class and lower middle class create inflation.

There’s just not enough rich people to matter. They’re irrelevant. So when you look at the last

two or three spikes and waves of risk that we’ve seen globally, they’ve come from large

multi 100 million person cohorts of people, right? Those could be in Asia, those could be

specifically in China, those could be in the United States, plus all around the world because

of certain loose monetary conditions. That’s what we have. Now, we have a multi 100 million,

probably approaching more than a billion person strong, liquid buying pool of people that are

again, as I said, if the if the lowest on the pecking order is now making 17 bucks an hour,

we all know this, guys, it’s not as if the inflation stops at 50,000 bucks a year,

everybody’s wages rise. So consistent and persistent wage inflation will allow you to

spend more because that’s just what people do. We also have high savings rates. So people will feel

more flush with money. The point is that everybody will spend, they will spend more,

you know, you can’t get cars, you can’t get this, you can’t get that all this pent up demand will

get fed. And the downstream implication is I think that prices will rise, but it will

disproportionately hurt the middle class and the lower middle class. And then these asset bubbles

will probably deflate, or they’ll have to get rerated. And if the Fed stops tapering, and you

know, hikes rates two or three times over the next 12 or 18 months, man, this is an ugly, ugly

stock market. One of the things people have been asking me to ask all of us on the pod is what are

our strategies right now given the turmoil we’re in? So maybe we can go around the horn. And what

we’re thinking about in terms of our strategies to deal with inflation, while maybe not getting

ahead of our skis and being the bag holders? Anybody have?

I’m not gonna answer this question. And you know why? Because I can’t got it. Okay,

because of the public market. I don’t I don’t want to even answer this question yet.

Okay, well, can I offer me further describe the problem. So this happened in the late 1970s. We

had stagflation we had sort of every year we had increasing inflation because the expectation game

and the thing that broke it was you had Paul Volcker come in at the Fed and he jacked up

interest rates. And he actually caused a pretty severe recession in like 80. I think it was like

  1. 81 82. I think by 83, we’re coming out of it. And then the economy absolutely boomed interest

rates came way down because he broke the back of inflation. And actually interest rates came down

for you know, as a result of Volcker and the Fed controlling inflation, they came down for

4040 years, basically. And those that decrease in interest rates, fueled everything, it made debt a

lot cheaper, it, it made the stock market boom, because the net present value, the discount rate

went down. So the net present value of all those future earnings went up. So you had it set the

stage for the boom in the Reagan era, and beyond and the Clinton era as well. Now, what’s the

difference between that and now? Well, for one thing, the government debt as a percentage of GDP,

when Reagan took office was around 31%. Okay. So when Volcker jacked up interest rates,

it didn’t really create that much more of a debt service costs for the United States for

the federal government. Now, today, the the government debt is 125% of GDP. So if and this

goes back to the to the Druckenmiller point from previous pod, if the the Fed were to jack up

interest rates to say the historical norm of 4.9%, debt service would go from 2% of the federal budget

to 30%. You would have a massive crowding out of government programs. So how we fund all that

debt service, very unclear. So we’re caught between a rock and a hard place. The rock is we

have inflation that could be persistent. The hard place is the debt service. So you know, the tools

for controlling this aren’t exactly clear. So this I think is fundamentally the problem is it’s not

clear whether we’re going to have, you know, interest rates going up or persistent high

inflation. Those are the threats to the sort of economic boom we’re seeing. Now the flip side of

it is that the reason why the stock market is one of the reasons is that an all time highs because

earnings right now are fantastic. So the economy is doing very, the companies are doing very well.

But we just had for Q3, the GDP growth was at 2% annualized, which was sort of an anemic number.

It’s the lowest it’s been since this COVID recovery started. So it’s, you know, it’s interesting,

we’re at all time highs, but there’s also these like major storm clouds on the horizon.

And I’m not going to like pretend like I know what’s going to happen. I just,

you know, when when things are this good, I start getting nervous when it’s this easy to make money

across everything, the stock market, the crypto market, the SaaS investing we’re doing.

That’s the part that really scares me. So for example, when everybody gets tilted,

because there’s some Shiba wallet, where 8000 turns into 5.7 billion, right. So for those that

don’t know, there was a, you know, Shiba Inu coin, which is a shit coin, which was basically

there to ape the other shit coin, Dogecoin, the Dogecoin, right, a meme coin, all of a sudden,

some guy 13 months ago, put 8k into it, because the whole market cap was 80k. And then all of a

sudden, over the course of these 400 days, that wallet holds $5.7 billion of value or 10% the

entire market cap of Shiba. People get tilted by that. Then there was an article today in Bloomberg,

where there’s a gentleman, a 66 year old man in Singapore, who’s a billionaire, right,

so he was successful in his own right. However, he had made in his entire career about one or 2

billion. And he has made 7 billion in the last two years, speculating on Tesla call options.

I’m not kidding. So buying short dated calls, right, riding the riding the wave, making money,

allocating the gains, buying the underlying Tesla security, over and over and over again. And so,

you know, I was talking to Nat about this, and I was telling her these, these examples,

and she’s like, that’s what sounds like a bubble. Because it really is very difficult to be in

business and to make these decisions and to be reasonable. Also, if you’re a capital allocator,

if you’re a capital allocator, or you’re building companies, like, how do you know if you’re doing

a good job, if everybody just is, I’m gonna be right back, guys, I have to I have to do the

goods. Yeah, okay. Got a quick baby change. I think what’s hard about this is, okay, so one

of the areas where it’s sort of like best times ever, are is the SAS market, which is where I

invest in. And I’m obviously investing in very, very early stage companies. But we’re seeing

valuations now go to multiples of ARR that we’ve never seen before.

50, 75.

I would say 100 times, I’d say 100 times ARR is sort of the rule of thumb right now.

And you’re seeing

what scale a $5 million company is worth 500 million?

Anywhere from 1 million to 10 million. I mean, absolutely.

Is worth between 100 and a billion dollars, which makes no sense.

Well, no, it does. If well, let me give you the argument for why it could make sense. Okay,

let’s say the company is expected to go 3.3x this year, and 3x next year, that’s basically a 10x

over the next two years. So that 100x in two years will only be a 10 times ARR multiple. And by the

way, if you look at the comps, for the companies that have gone public, the SAS companies have

gone public, like look at toast being worth what 30 40 billion. So they’re trading at 30 40 50 60

times ARR in the public markets on big, big numbers. So my point is,

How hard is it to go 3x 3x? That is, I mean, going 3x is hard going 3x 3x back to back.

That’s like winning two and you know, NBA championships.

No, I don’t think it’s that hard. I mean,

It’s not for you, but you’re the king of SAS.

No, I’m being dead serious for the for a SAX founder with a million to go from one to three,

and then three to nine. How many out of 100 actually go from one to nine?

I’ll tell you Yammer’s trajectory. And this is this is over a decade old. We went from

1 million in our first full year selling the product to well, back in those days,

we looked at total contract value of 7 million of TCV, that was about 5 million of ARR. And then it

tripled the year after that. So, you know, and then we tripled the year after that.

Well, a category defining SAS company.

So you’re taking

Microsoft, but I’m just saying that it’s entirely possible. There’s a lot more

Yammer’s today or companies that growth trajectory. So I mean, but look, this is what’s

led to, you know, our fund to which we started investing in 2019, which has a SAS focus,

already has five unicorns in it from companies that we invested in the Cedar City.

That’s crazy.

So but look, I mean, when you’re seeing, like results that good, where my head goes is,

okay, this is too good. You know, what am I missing here? Like, what’s the downside? And

how long will this sustain?

Just to build your just to build on your point, there are these businesses that have,

I would say, interesting products that are growing well, but they may not actually be

very important companies. Yet they trade at enormous valuations. And then you have these

companies that are just so superb. And I’m talking about Microsoft, Google, Apple, and Facebook,

that now trade in many cases at some pretty deep discounts to their intrinsic value. But this is

the sign of this histrionic behavior that I think embellishes the end of a bubble, right? It’s this

thing where you look at a growth rate, and you don’t even ask the structural questions about

business quality, viability, sustainability, competitive modes, you’re like, Oh, well,

it’s going from 300% market, you know, it’s only decaying to 200%. I buy. Well, it’s like,

but yeah, but what are you buying? And is there any longevity and staying power? This is why,

you know, I’ve, I think there are some great businesses in SAS. But I also think there’s

a lot of head fakes. And in the public markets, particularly people just want to buy that growth,

as David said, because they’re chasing yield. They’re not, you know, do they really understand

am I buying this company, because I really believe in this database technology versus

that streaming technology versus this container technology. They don’t know any of those things.

Well, so this is the conundrum is I actually do believe like, so I believe my own portfolio,

and I’m doubling down on all these companies. And I do believe in SAS. And I think the reason why

these SAS companies get such great multiples is because they’re pure software businesses,

very high gross margins, 80% plus gross margins. You know, once the flywheel gets going, they’re

very hard to displace. I mean, they have, it’s not just a recurring revenue subscription type

business, but you get expansion out of your current customer base. So, you know, on January 1 of a new

year, you’re starting with 120%, 150% of last year’s revenue, just from your existing customers.

And then you’re stacking the new revenue courts on top of that. So I am a believer in SAS. But

when I see everything going so well, it’s SAS and NASDAQ and S&P and crypto. And then I see,

you know, 125% debt to GDP and the sort of radical spending that’s coming out of Washington.

I just start getting nervous. And I don’t know if I have like a prescription for people out there.

I would just be a little bit cautious right now and temper your enthusiasm. But look,

the flip side of it is, we could keep having a boom for five more years, you know? And so,

the market could keep going for five more years. And so, what do you do? Sit it out while inflation

is going through the roof? No, you can’t sit it out. You can’t sit it out.

Yeah, you can’t sit it out. But, you know, I was listening to Vinnie Lingham’s

show on Beep on Call In. It’s called Crypto Musings.

There we go. No, he and Sonny Madre do a great show that you guys-

I think we all just got 25 bips.

You guys should all listen to his show. It’s called Crypto Musings. They were talking about

all the dog coins the other night. It was Shiba Inu and Dogecoin, and there’s a couple others.

Vinnie made a great point. He said, listen, if you’re out there listening and you’re sitting

on life-changing money and Shiba Inu, sell. Take it off the table if you can.

Of course.

Keywords being if you can. So, look, this boom could last for another five years. It could

last for another 10 years. And the valuations could keep going up. The earnings could keep going.

You don’t want to miss out on that bull run. But if you’ve got life-changing money

in a highly risky position-

And you’re not diversified.

I’m amending my advice of let your winners ride to take some chips off the table prudently.

Doesn’t mean you sell everything, but just take some chips off the table.

To diversify specifically.

Diversify, yes.

Yeah, I mean, I think it’s absolutely-

I mean, I got to say, when you saw these quarterly earnings,

there is no better business in the world than Google. Single-handedly par excellence,

the most incredible money-making machine that’s ever been created.

And a close second, as it turns out, is Microsoft.

Unbelievable. I mean, just to-

Which is now the most valuable company in the world, greater than Apple.

Well, and Friedberg’s been saying this on the podcast forever, but

just to give people an idea, Q3 revenue at Google was up 41% year over year.

To $65 billion in a quarter.

And by the way, that is high margin.

High margin.

The incremental revenue on the core Google product

generated an increment, operated at an incremental 50% EBITDA margin.

And they just adjusted their CAPEX depreciation amortization schedule

because they realized that their computers that they use in their data centers last

four years instead of three.

And the networking equipment lasts five years instead of three.

So they’re like, and I’ve been saying this since the beginning,

because I worked at Google, and Urs is still there.

And he runs all the data centers and the networking infrastructure.

When I worked at Google, there was this amazing project

where we built a 10,000, we didn’t build it, they built it, a 10,000 port switch

called Firehose, which helped increase the throughput of the data centers and

have these massively parallelized indexing and production servers.

And there was so much investment made from the beginning in building the

infrastructure stack, the flywheel continues to move, spin faster and faster and faster.

And here they are building their own servers, building their own racks,

their own data centers.

Literally the most… They have their own fiber across the oceans.

Literally the most vertically integrated business in history,

with a moat that no one will ever be able to catch up on.

And I read all these nonsense comments on the internet about people being like,

why doesn’t someone else go after search?

It’s so crazy to me.

People fail to recognize that what we see is the tip of the iceberg at Google.

And this flywheel is built by layers and layers of monopolistic, in a good way,

monopolistic technical advantages that they’ve built into this business over

the period of the past two decades.

And it is extraordinary, beyond anything we’ve ever seen in human history,

how well this commercial enterprise has run.

And the reinvestment of capital has been extraordinary.

If you look at YouTube in the quarter, YouTube generated… This is insanity.

YouTube is now operating at a nearly $30 billion revenue run rate.

And that’s just like pure margin incremental revenue for Google,

layered on… Built off of the same ad network that they were originally running on Google.

Obviously, they have a different ad team now at YouTube.

But YouTube now has more revenue than Netflix and is growing at likely 40% to 60%

year over year revenue growth rate.

Whereas Netflix is considered one of the fang stocks, one of the top stocks.

And Netflix is only growing at 22%.

Sure, remove Netflix and just put Google twice. It should be…

And then you look at Google Cloud…

YouTube in there on its own.

And Google Cloud is now operating at a $20 billion run rate.

And they can just throw these services on top of all these flywheels that they’ve built.

And they become massive enterprises unto themselves.

It is a behemoth that is effectively not a tax in a bad way, but a tax on the internet.

Because they are core infrastructure to service

almost everything that we all consume and use over the internet in some way or another.

Yeah, but they give it to everybody for free, and they build the internet for everybody.

They have been extremely smart about competitive pricing.

As we saw recently, they dropped the commission in the Play Store to 15%.

If I’m making an app and I’m giving Apple 30%, now I give Google 15%,

I’m more inclined to promote my Android app and that’s going to affect users.

And they’re putting out this Pixel 6 phone that looks like an incredible piece of equipment

that’s cheaper than the iPhone.

They’re an incredible company.

They are so incredibly well run at the top.

Sundar is an incredible CEO.

And they are running a money printing press at Amphitheater Parkway in Mountain View.

I was going to say, Jason, to your point, I was talking to somebody.

And one really interesting thing that this organization did was a couple of years ago,

they basically went long Google and Microsoft, and they shorted Apple, Amazon and Facebook against it.

And I asked them why.

And they said, it’s the best inflation hedge we could come up with at massive scale

that could work in a way where we’re long growth, but we’re hedged where the types of

supply constraints that could come in and kick us in the ass would never affect Microsoft and

Google the same way that it would affect Apple and Amazon, which, by the way, in their earnings

results, they said, right, Amazon has huge issues on the supply chain side.

Apple has huge issues on the supply chain side.

Amazon was up 15%.

They missed their numbers.

Although Amazon Web Services is a 40% year over year, also on a big number $16 billion in AWS

revenue for q3.

So that as a standalone company is now on a what do you what did you guys think about meta?

60 billion?

Oh, my god.

I mean, that was did you watch the video?

I watched the whole thing.

I watched two minutes of it.

And then I stopped watching.

I mean, it’s basically, you have Facebook in the face of all of the things, all the

times they got their hand caught in the cookie jar, saying, this is going to be the new world.

But instead of us doing everything wrong and screwing the users and their privacy and democracy

and creating strife in the world, this time, we’re going to make it open source.

This time, we’re going to build a coalition and partnership.

And this time, it’s going to be awesome.

And it’s it’s like, a dystopian SNL skit, where Zuckerberg is describing the future,

and he literally describes how proud he is that you’re going to be able to play Grand Theft Auto.

And Nick Clegg is like, yeah, this is going to be amazing.

This time, we’re going to bring all the regulators and the scientists in to tell

us how to build it.

And we’ll have consensus of how to build the future.

And you’re like, did you just say that everybody in 3d is going to be in a virtual space

beating each other up with bats and guns and killing police officers in Grand Theft Auto?

Luckily, they didn’t show a clip of it.

But it was basically Zuckerberg taking credit for every single virtual reality or augmented

reality thing you’ve seen over the last 20 years, he literally took everything from education,

to HoloLens, to, you know, poker games.

And he took basically credit that this is going to be the future.

And that instead of this time, it being a closed ecosystem, it would be an open one

that supports NFTs.

And don’t worry, this time, I think any developer who puts any amount of their effort into supporting

in any way Zuckerberg’s view of the metaverse is crazy, when they could do it on a distributed,

decentralized, crypto based open source platform, you do not want to give Zuckerberg any more


And if there is even a 10 or 20% chance that this is the next big compute platform,

Zuckerberg needs to be stopped from doing it by the market.

Jacob, I think you’re crazy.

I think you’ve lost your mind.

I haven’t.

Yeah, I think you’ve lost your mind.

Oh my god.

I have a counter argument too.

Okay, David, you start.

Well, I don’t even know if I could categorize what I’m about to say as a counter argument.

I don’t even know how to counter that.

All I would say is, look, I think it’s really great that Facebook is spending all this

R&D money on metaverse virtual reality.

Oculus is a really cool product.

I think, Jason, you’ve made the observation that people use it once, say it’s the coolest

thing ever, and never use it again.

There is that element to it.

They have to solve that.

Using Oculus for the first time was one of the most unique experiences I’ve ever had

with computing.

But I admit, I don’t use it anymore.

It’s just not something I do.

Better or worse than Pornhub the first time?

But in any event, look, I think the fact that…

That’s his way of saying worse.

I think that the fact that Facebook wants to do all this R&D and virtual reality, great.

Changing the name of the company, however, at this point in time, it felt to me like

a little bit like Philip Morris changing his name to Altria Group.

And by the way, I don’t buy the idea that Facebook is like cigarettes.

I don’t believe that at all.

I don’t think it’s bad for people in the way that it’s been hyped up to be.

But you’re saying this is a PR marketing strategy.

But it feels like they’re running from their name.

And basically, it’s almost like saying, this whole business of social networking has been

so sullied that we need to appear to be a diversified portfolio of companies, of which

social networking is just one small piece.

A deprecating piece.

Yeah, exactly.

And I don’t really buy into that.

And I think if that was any part of their motivation, it’s a mistake.

Because I think the only thing Facebook should do about all these accusations is get up on

their hind legs and fight.

Because I think all these leaks from the so-called whistleblower, I think this is a completely

orchestrated political hit.

And they should just fight back and push back on it.

I think the dangers of social networking have been vastly exaggerated.

So it seems to me like they’re buying into that nonsense by running from their name.

So I at least would not have done this right now.

I would have won that battle.

And then if it was still important to change their name, then I would have changed the name.

Well, they’re losing young people at an extraordinary rate on Facebook.

US teenagers were projected to decrease by 45% over the next two years.

Young adults between the ages of 20 and 30 were expected to decline by 4%.

Or TikTok, I think is probably more accurate.

Yeah, TikTok is big, yeah.

Yeah, during that same timeframe via a leaked memo obtained by The Verge.

I mean, how in the world is Facebook or Instagram more dangerous than TikTok?

I don’t get it.

No, TikTok is deranged.

Which, but by the way, our Stan making, our Henry Bellcaster of TikTok is reporting that

we have like millions of views over there.

So there’s some rogue.

Did I say that how much I love TikTok?

I love TikTok.

He’s building our audience.

We’re connecting with Gen Z, by the way.

Freedom, go TikTok, go TikTok, go CCP.

You’re right, you’re right.

The TikTok account, there’s an all in TikTok account done by a fan.

And we got like 2 million views in the last week.

It is absolutely bonkers.

We just passed Rachel Maddow and a bunch of folks.

Yeah, we’re more popular than all of MSNBC.


Well, I mean, come on, way to set the benchmark.


Do you guys remember a year ago, Larry Ellison negotiated this deal with Trump to buy TikTok?

That’s brilliant.

Yeah, he’s going to throw in Lanai.

Friedberg is.

And Masa-san was supposed to be on TikTok’s board.

Yeah, that’s by the way, Xi Jinping is on Lanai right now.

And Larry Ellison got TikTok, fair trade.

Nobody talks about the billy that Ellison kicked into Tesla right before.

He’s such a boss.

He made like 12 billion dollars.

15, 15, 15, 15, 15 billion.

He’s such a boss.

He put a billion dollar investment, joined the board, told everyone.

Zip, zip, zip.

Talk all the smack you want about this guy.

But he’s landing spaceships on a drone ship in the middle of the ocean.

What are you doing?

He’ll figure it out.

He’ll figure it out.

And 50 next.

It’s insane.

But wait, I have one question for Friedberg.

Is Zuckerberg pulling a Larry Page, i.e.

somebody else becomes CEO of the Facebook collection of companies,

and then he becomes the chief product officer,

and then doesn’t have to go to Senate hearings?

No, I think he’s way more active and driven in terms of product direction than Larry ever was.

So I don’t think they’re the same person.

And I wouldn’t liken these two at all.

What about the meta strategy of changing the company name?

By the way, my prediction was that they were,

I should have done this on the pod a month ago.

I said they were going to change their name to meta.

I think that at some point, as you diversify these businesses

away from your core, and you have this core engine driving the business,

you have to make it look like these businesses can and will operate independently.

While they might get some leverage off of one another, and one might feed into the other,

they need to be able to operate independently from a kind of public perception,

operating a management perspective.

That’s what Alphabet did.

It’s a natural progression of states,

as you start to do things that are too far distinguished from one another.

And so it feels reasonable.

I think, you know, is this a whole like PR rebranding?

Maybe to some extent, that’s helpful.

But I do think that this idea that we need to do more than we’re doing today,

and we need to make a big hard cold bet on it is what this represents.

Now, the important psychological question,

is he doing it out of a matter of defense?

Meaning like, does this signal fear about the core business?

Or is it about ambition and aggression and rebets

on new opportunities and emerging opportunities that he thinks?

And that’s the big debate that I think is kind of going on right now

is how much often when you see people make big moves like this,

it’s either out of greed or out of fear.

And I think some people are asking the question,

how much should we be afraid of the core business being eroded

based on his making this sort of a big bet?

Oh, you think this could perpetuate that?

Or it’s a bit of a tell that this is happening?

I tell a guy, right?

And I’m not saying that’s the case.

I’m saying that’s the question, right?


And that’s the question a lot of people are asking.

Is this a tell that the core business is at serious risk?

Why do he’s putting 10 billion into it this year,

for example, this Apple, you know, ad revenue business,

I think is climbing by billions of dollars,

while Facebook’s core business is being affected

by the cookie tracking policy change on Apple iOS.

So at the same time that, you know, Apple’s reaping these benefits

from the changes that they’ve made in iOS,

you know, people don’t really have great visibility

into how much it’s really affecting

Facebook’s ad revenue at this point.

And this could be, as you point out,

the tell that maybe things aren’t that good,

and he needs to diversify,

and he needs to make a big aggressive bet elsewhere.

So, you know, we’ll see.

I mean…

Important question, Chamath,

are we going to celebrate the birth of both

your and Friedberg’s daughters with a poker game?


With my gambling?


Do you want me to give you my thoughts on that?

Or no, you don’t care.

No, it’s a joke.

Can you take paternity to go to…

I got a board meeting.

I gotta go, bye.

All right.

For the queen of quinoa.

Wait, wait, wait, don’t you want to know what I think?

I think on the meta thing,

I think the risk is if Google and Apple

take the hardware costs to zero,

because I think there’s an incentive

in a highly fragmented ecosystem.

You have to remember when Apple introduced the iPhone,

there was nothing that came before it.

So it was completely groundbreaking.

And I think what Facebook has to figure out

is how to make their VR experience so revolutionary

that it attracts developers.

And in the meantime,

if Apple and Google figure out

how to kind of give it away for free

and just kind of make it a low cost hardware game,

where everything else, Jason, as you say,

is this kind of open source thing

where it’s like a browser.


Right, where everything just exists

in a DeFi kind of world.

Like the web and the internet.

Then it’s a little bit more problematic

for all the money spent.

That’s what they have to figure out.

Do you think, Sax, it’s going to be VR or AR?

What wins the day with consumers?

Well, that’s a good question.

I mean, they’re very different experiences.

Both can win.

But if we’re talking 20 years from now,

which one will be used more?

Or 10 years from now, 10 to 20 years from now,

which one will make more money,

be more relevant, be more utilized?

Well, I mean, AR, the dream there

is that you wear these glasses

that have like the Terminator view,

where it’s like scanning the world

and giving you information.

You’ll never forget anyone’s name again.

Stuff like that.

That would be kind of useful, maybe.

VR, I think, is more about immersion.

It’s really like a gaming experience,

I think, at least now.

I think it’s all about AR.

Basically, what he was saying there,

he was talking about VR.

I think VR lets you make the worlds.

And then AR lets you experience them

concurrently with the real world.

And it’s the same tools and libraries and kits.

As a developer, making it for VR, AR

is going to be pretty, I think, seamless.

And so I think Apple has skipped VR on purpose,

and they’re going to AR.

I think Google is basically

going to go directly to AR.

And then where does that leave?

And then Microsoft already has HoloLens

that they’ve been investing in heavily.

And I think they got the biggest lead

that at least we publicly know about.

So I think it’s going to be a race

for who can get AR to work.

And VR is just like kind of a waypoint

on the way there.

There’s a lot of stuff going on.

And I’m sure that people will want

to check out of the real world

for some amount of their life.

But they’ll probably also want

to be in the real world

for some part of their life.

And at some point,

maybe if those two things merge,

that distinction won’t matter as much.

And I think if the experience

is compelling enough, it could happen.

Well, I mean, if you think about us

playing poker on one of those poker apps,

if we could put our glasses on,

sit in our room and see each other

at a poker table,

you know, like if Bogut wanted

to play from Australia,

and he was, you know,

projected into the seat on the game,

and we all saw them there with glasses,

AR glasses, that would be amazing,

wouldn’t it?


Be able to, you know,

have two of the people at the game

be projected in, as it were.

Could be, especially if it was Diego.

I mean, that would be pretty great.

I mean, for that,

I’m saying for the good of the game.

I did a tweet where I said,

listen, VR, people leave it on the shelf.

And I, you know,

Paul Malucky and a bunch of people

got in my face about it.

And then we had like,

actually really good discussion.

And I said, well,

what about serious gamers?

Because I’m talking about serious gamers.

They all buy it,

and then they never use it.

And they said, yeah,

it’s not for serious gamers.

I said, okay, well,

what about iPad gamers and casual gamers

and Bejeweled and Candy Crush?

They’re like, oh yeah,

they’re not interested in it.

And I’m like, well,

who are the gamers then?

Is it the intense ones

or the casual ones?

They said, no,

there’s a new category.

The number one game,

like Rec Room,

Beat Saber and Golf

are like crushing it

with a million users a month

in some cases.

You know what they all have in common?

They’re physical activities

where you get some amount of exercise,

and it would be very difficult

to coordinate in the real world.

I know, but Jason,

when you look at things like Axie Infinity,

where there are play to earn movements

that are happening in sort of this

layer three kind of DeFi world

where you’re getting paid

to basically play games,

that could be a job.

And then you will spend eight to 10 hours

in the metaverse of some sort.

So these things are very possible.

I find it so dystopian.

Yeah, that’s true.

But I’m sure that our parents

find some parts of our lifestyle dystopian.

And, you know,

we find certain parts

of our kids’ lives dystopian.

It’s just what happens.

Yeah, I don’t know.

All right, everybody.

We will play poker.

We will play poker.

Yeah, we got to play poker at some point.

I mean, we’ll play poker either,

either Tuesday or Thursday.

Okay, yeah, well, that’s good.


Babies will be like almost a week old.

Which days are you going to flake?

Tuesday and Thursday?

Which day will you flake?

Tuesday and Thursday?

Tuesday and Thursday.

I mean, do I have to come pick you up?

I can play on Tuesday.

All right, everybody.

For the Queen of Quinoa,

the Rain Man and the Dictator,

I’m Jason Calacanis.

We’ll see you all next time on All In.

Love you, besties.



You’re a winner’s line.

Besties are gone.

That’s my dog taking a notice in your driveway.

We should all just get a room

and just have one big huge orgy

because they’re all just useless.

It’s like this like sexual tension

that they just need to release somehow.


You’re a B.


You’re a B.

You’re a B.

We need to get merch.

I’m going All In.

I’m going All In.