1 00:00:11,039 --> 00:00:14,560 Speaker 1: Hello, and welcome to another episode of the Odd Lots Podcast. 2 00:00:14,600 --> 00:00:18,640 Speaker 1: I'm Joe Wisntal and I'm Tracy Halloway. So, Tracy, I 3 00:00:18,640 --> 00:00:21,639 Speaker 1: don't know, you're just waking up in Hong Kong. But 4 00:00:21,960 --> 00:00:24,000 Speaker 1: we had a little bit of market volatility to day. 5 00:00:24,040 --> 00:00:26,080 Speaker 1: Do you see that, you know what? I woke up 6 00:00:26,120 --> 00:00:29,479 Speaker 1: to an alert on my phone. Something It's never good. 7 00:00:29,560 --> 00:00:31,760 Speaker 1: Have you ever noticed whenever you get those alerts on 8 00:00:31,800 --> 00:00:34,600 Speaker 1: your phone, it's never anything good. It's always something bad. 9 00:00:34,640 --> 00:00:38,440 Speaker 1: But yes, something about stocks falling. Yes, there's never been 10 00:00:38,440 --> 00:00:41,960 Speaker 1: a good push, that's safe to say. But it is 11 00:00:42,240 --> 00:00:46,520 Speaker 1: June eleventh. We just had this market volatility. Nonetheless, even 12 00:00:46,560 --> 00:00:49,279 Speaker 1: with the volatility, there is this sense that people have 13 00:00:49,360 --> 00:00:51,760 Speaker 1: and maybe it'll change by the time people are listening 14 00:00:52,000 --> 00:00:54,920 Speaker 1: to this episode. Is that the sort of the most 15 00:00:55,040 --> 00:00:59,040 Speaker 1: intense periods of the crisis at least, you know, it's 16 00:00:59,040 --> 00:01:01,440 Speaker 1: not as intense as it was back in early April 17 00:01:01,520 --> 00:01:04,840 Speaker 1: or late March. Yeah. Absolutely, I think that's true. And 18 00:01:05,000 --> 00:01:08,199 Speaker 1: certainly earlier this week we did get another alert, which 19 00:01:08,319 --> 00:01:11,440 Speaker 1: was so I guess sometimes you do get good alerts, 20 00:01:11,440 --> 00:01:15,520 Speaker 1: but the alert was smid regains all its losses for 21 00:01:15,560 --> 00:01:17,840 Speaker 1: the year and basically went back to the highs that 22 00:01:17,920 --> 00:01:21,480 Speaker 1: it was seeing before the coronavirus. So we do have 23 00:01:21,520 --> 00:01:23,759 Speaker 1: a sense, and I think a lot of people will 24 00:01:23,800 --> 00:01:26,240 Speaker 1: attribute it to either the federal Reserve or some of 25 00:01:26,319 --> 00:01:29,600 Speaker 1: the fiscal stimulus measures by the government, that these have 26 00:01:29,680 --> 00:01:33,440 Speaker 1: combined to at least save the stock market, if not 27 00:01:33,600 --> 00:01:38,480 Speaker 1: the real economy. Right, it's still very tb D on 28 00:01:38,520 --> 00:01:40,040 Speaker 1: all that. One of the things, and you and I 29 00:01:40,120 --> 00:01:42,160 Speaker 1: have talked about this tracy, is that in the middle 30 00:01:42,200 --> 00:01:44,560 Speaker 1: of a crisis. One of the things that makes crises 31 00:01:44,680 --> 00:01:48,480 Speaker 1: interesting is it new ideas can emerge. And so often 32 00:01:48,520 --> 00:01:50,840 Speaker 1: when things are growing, people don't want to rock the boat. 33 00:01:51,120 --> 00:01:53,600 Speaker 1: But in the middle the acute phase of a crisis, 34 00:01:53,720 --> 00:01:56,760 Speaker 1: it always feels as though there's openings for sort of 35 00:01:57,040 --> 00:01:59,880 Speaker 1: new ideas, new approaches, and a sort of wide range 36 00:02:00,120 --> 00:02:03,240 Speaker 1: discussion about what the future should look like. Yeah, I 37 00:02:03,240 --> 00:02:06,360 Speaker 1: think that's right. It's funny how there's nothing like losing 38 00:02:06,400 --> 00:02:10,639 Speaker 1: money to make everyone reevaluate their capitalist model. But yes, 39 00:02:10,680 --> 00:02:13,040 Speaker 1: there does seem to be an opportunity in crisis for 40 00:02:13,080 --> 00:02:17,280 Speaker 1: people to start thinking about deep seated issues in their 41 00:02:17,280 --> 00:02:20,640 Speaker 1: respective markets, or the way the economy works, or even 42 00:02:20,800 --> 00:02:23,000 Speaker 1: the political system which is something that we're sort of 43 00:02:23,040 --> 00:02:26,120 Speaker 1: seeing now. Yeah, that's exactly right. So today we're going 44 00:02:26,160 --> 00:02:28,840 Speaker 1: to be talking to a guest who actually got a 45 00:02:28,840 --> 00:02:31,840 Speaker 1: lot of attention. He had this interview when totally viral. 46 00:02:31,919 --> 00:02:34,160 Speaker 1: I think it was back in early April. That had 47 00:02:34,200 --> 00:02:38,079 Speaker 1: to do with Bailouds, and it was very opposed to Bailouds, 48 00:02:38,280 --> 00:02:40,079 Speaker 1: but it was a sort of good example of how 49 00:02:40,120 --> 00:02:42,600 Speaker 1: in the most intense period there is this sort of 50 00:02:42,680 --> 00:02:45,919 Speaker 1: yearning for people uh to offer different ideas than the 51 00:02:46,000 --> 00:02:48,079 Speaker 1: sort of standard approach where we just sort of try 52 00:02:48,120 --> 00:02:51,040 Speaker 1: to u put everything back together again. Yeah, and can 53 00:02:51,080 --> 00:02:53,520 Speaker 1: I just say that this interview was so viral that 54 00:02:53,639 --> 00:02:57,240 Speaker 1: even I in Hong Kong without access to US cable 55 00:02:57,280 --> 00:03:00,880 Speaker 1: TV saw clips of it exactly. So today we're going 56 00:03:00,919 --> 00:03:04,399 Speaker 1: to be talking to Chamath Poli Hapatia. He's the founder 57 00:03:04,480 --> 00:03:08,760 Speaker 1: and CEO of Social Capital. He's the chairman of Virgin Galactic. 58 00:03:09,080 --> 00:03:11,320 Speaker 1: I think he owns a steak in the NBA team, 59 00:03:11,600 --> 00:03:13,920 Speaker 1: the Golden State Warriors. I think there's our there's our 60 00:03:13,919 --> 00:03:15,919 Speaker 1: second time now we've talked to someone who owns part 61 00:03:15,919 --> 00:03:18,799 Speaker 1: of an NBA team, Having talked to Mark Cuban, as 62 00:03:18,880 --> 00:03:22,120 Speaker 1: you mentioned back in April, he uh did this interview 63 00:03:22,120 --> 00:03:25,760 Speaker 1: on CNBC talking about the airline bailouds it's been very 64 00:03:25,800 --> 00:03:29,600 Speaker 1: critical of share buybacks bailouts that, in his view, prop 65 00:03:29,680 --> 00:03:33,320 Speaker 1: up the rich while failing to protect everyday people. Things 66 00:03:33,360 --> 00:03:35,640 Speaker 1: are a little bit less severe right now than they 67 00:03:35,640 --> 00:03:37,680 Speaker 1: were back then, but nonetheless, I think there's still a 68 00:03:37,720 --> 00:03:39,800 Speaker 1: lot of space to be talking about these ideas. So, 69 00:03:40,160 --> 00:03:43,240 Speaker 1: without further Ado Chama, thank you very much for joining us. 70 00:03:43,560 --> 00:03:47,480 Speaker 1: Thanks guys, thanks for having me on. So let's go back. 71 00:03:47,520 --> 00:03:51,440 Speaker 1: I mean, I remember that interview. It absolutely blew up 72 00:03:51,680 --> 00:03:56,960 Speaker 1: all over social media. What was your main message, like, 73 00:03:57,000 --> 00:03:59,800 Speaker 1: what was the thrust of what you saw we were 74 00:03:59,840 --> 00:04:03,200 Speaker 1: doing wrong, both in terms of an economy and in 75 00:04:03,280 --> 00:04:05,840 Speaker 1: terms of the political approach to addressing the crisis that, 76 00:04:05,880 --> 00:04:09,000 Speaker 1: in your view is misguided. Well, I mean, I think 77 00:04:09,080 --> 00:04:12,920 Speaker 1: that we've probably known for a long time that the 78 00:04:12,960 --> 00:04:18,320 Speaker 1: tools that we give politicians to help society function probably 79 00:04:18,560 --> 00:04:22,080 Speaker 1: have never been duller. They typically have a lot of 80 00:04:22,160 --> 00:04:26,120 Speaker 1: unintended consequences, and so my commentary was more of a 81 00:04:26,120 --> 00:04:30,360 Speaker 1: frustration in realizing that this thing was going to meaningfully 82 00:04:30,400 --> 00:04:35,160 Speaker 1: exacerbate what was already a very very skewed economy and 83 00:04:36,000 --> 00:04:38,159 Speaker 1: that the people that needed the help wouldn't get it, 84 00:04:38,360 --> 00:04:40,240 Speaker 1: and that you would see the emergence of a lot 85 00:04:40,279 --> 00:04:43,520 Speaker 1: of perverse incentives that wouldn't really fix the system properly, 86 00:04:43,960 --> 00:04:45,440 Speaker 1: you know, just to know that now we're going to 87 00:04:45,560 --> 00:04:49,800 Speaker 1: deal with the tail many years long of the activity 88 00:04:49,839 --> 00:04:52,840 Speaker 1: of Treasury and the Fed over just you know, what 89 00:04:52,880 --> 00:04:55,480 Speaker 1: was basically four to six weeks of a of a 90 00:04:55,560 --> 00:04:58,520 Speaker 1: drunken binge will play out in ways that will have 91 00:04:58,600 --> 00:05:01,360 Speaker 1: just a lot of unintended consequence, I think. So I'm 92 00:05:01,360 --> 00:05:03,760 Speaker 1: going to declare an interest here, which is that my 93 00:05:03,880 --> 00:05:07,360 Speaker 1: dad is a former pilot, and he was a pilot 94 00:05:07,360 --> 00:05:10,240 Speaker 1: for Southwest Airlines for a long time, and I remember 95 00:05:10,320 --> 00:05:14,159 Speaker 1: distinctly in the early two thousand's after the nine eleven attacks, 96 00:05:14,160 --> 00:05:17,320 Speaker 1: when a bunch of his competitor airlines were getting bailed out, 97 00:05:17,360 --> 00:05:19,560 Speaker 1: he used to get really annoyed and say, why are 98 00:05:19,720 --> 00:05:23,920 Speaker 1: his taxes going to pay his competitors. Of course, fast 99 00:05:23,960 --> 00:05:27,440 Speaker 1: forward to now he's retired, but he still takes a 100 00:05:27,440 --> 00:05:30,400 Speaker 1: big interest in Southwest and of course Southwest Airlines is 101 00:05:30,440 --> 00:05:33,320 Speaker 1: one of the airlines getting a bailout. But what do 102 00:05:33,360 --> 00:05:36,800 Speaker 1: you say to people who will argue that this is 103 00:05:36,839 --> 00:05:40,719 Speaker 1: a short term cash flow problem, and just because people 104 00:05:40,880 --> 00:05:43,479 Speaker 1: have been ordered to stay inside for you know, the 105 00:05:43,520 --> 00:05:47,760 Speaker 1: foreseeable future revenues are drying up. That shouldn't mean that 106 00:05:47,880 --> 00:05:52,760 Speaker 1: companies that are essentially viable should go out of business. Yeah, 107 00:05:52,800 --> 00:05:55,600 Speaker 1: I agree with that. I just think that the incentives 108 00:05:55,600 --> 00:05:57,880 Speaker 1: that the government creates to make sure that those things 109 00:05:57,960 --> 00:06:01,800 Speaker 1: don't happen can be very different um them just giving 110 00:06:01,800 --> 00:06:04,520 Speaker 1: a hand out. And the reason is because that the 111 00:06:04,560 --> 00:06:06,760 Speaker 1: handcuffs that we put on companies when we give them 112 00:06:06,760 --> 00:06:09,560 Speaker 1: these handouts are very brittle. And so what happens in 113 00:06:09,560 --> 00:06:12,240 Speaker 1: the case of airlines specifically, is that, you know, we 114 00:06:12,360 --> 00:06:14,680 Speaker 1: made them sign a pledge that essentially said that they 115 00:06:14,680 --> 00:06:19,080 Speaker 1: wouldn't lay anybody off until I think September, and I 116 00:06:19,120 --> 00:06:21,400 Speaker 1: think what you're going to see is a wave of layoffs, 117 00:06:21,440 --> 00:06:23,360 Speaker 1: and I think American has already announced that it's going 118 00:06:23,400 --> 00:06:27,200 Speaker 1: to happen essentially October one. And so, in no event 119 00:06:27,279 --> 00:06:29,760 Speaker 1: did any of this capital do anything other than just 120 00:06:29,839 --> 00:06:32,600 Speaker 1: dilute the actual problem at hand and confuse us all 121 00:06:32,680 --> 00:06:35,120 Speaker 1: into thinking what the problem was. Because you create a 122 00:06:35,120 --> 00:06:38,520 Speaker 1: problem where you've inflated the money supply, you've you know, 123 00:06:38,600 --> 00:06:41,799 Speaker 1: created more debt all of that debt. It gets spread 124 00:06:41,839 --> 00:06:45,040 Speaker 1: across every single American citizen, and none of us are 125 00:06:45,080 --> 00:06:47,479 Speaker 1: necessarily better off for it. So I think the better 126 00:06:47,560 --> 00:06:50,600 Speaker 1: question to ask is, actually, what could we have done 127 00:06:50,640 --> 00:06:55,440 Speaker 1: to actually help Southwest Airlines or American Airlines, or United 128 00:06:55,560 --> 00:06:58,560 Speaker 1: or Delta and the panoply of other companies that needed 129 00:06:58,560 --> 00:07:02,719 Speaker 1: help to bridge the time between the coronavirus and a 130 00:07:02,760 --> 00:07:05,440 Speaker 1: normal resumption in business. And I think you would have 131 00:07:05,520 --> 00:07:08,640 Speaker 1: come up with a whole bunch of different answers than 132 00:07:08,680 --> 00:07:10,360 Speaker 1: the ones that we came up with, which which is 133 00:07:10,440 --> 00:07:13,240 Speaker 1: essentially was here's a check, Please at least don't do 134 00:07:13,280 --> 00:07:15,360 Speaker 1: anything until near the election, so that we can at 135 00:07:15,400 --> 00:07:18,680 Speaker 1: least look, you know, semi competent. Well, what does that 136 00:07:18,760 --> 00:07:21,120 Speaker 1: look like to you? So we've kind of as a 137 00:07:22,000 --> 00:07:24,840 Speaker 1: if you look at the Federal Reserve and the Treasury combined, 138 00:07:25,280 --> 00:07:27,960 Speaker 1: we've sort of taken a dual track approach, which is, 139 00:07:28,400 --> 00:07:33,360 Speaker 1: provide a lot of liquidity loans to small businesses, loans 140 00:07:33,400 --> 00:07:36,960 Speaker 1: that could potentially turn into grants to keep the corporate 141 00:07:37,000 --> 00:07:40,280 Speaker 1: infrastructure alive. And then for the layoffs that have happened, 142 00:07:40,400 --> 00:07:44,040 Speaker 1: is sort of expanded unemployment insurance so that households can 143 00:07:44,080 --> 00:07:46,880 Speaker 1: maintain their income and buying power during the acute phase 144 00:07:46,880 --> 00:07:50,440 Speaker 1: of the health crisis, and the idea in theory is 145 00:07:50,480 --> 00:07:54,680 Speaker 1: that as the health crisis phades, the businesses were kept 146 00:07:54,680 --> 00:07:58,600 Speaker 1: alive with access to sort of cheap financing, households were 147 00:07:58,600 --> 00:08:00,880 Speaker 1: able to keep their buying power, keep their homes, keep 148 00:08:00,880 --> 00:08:03,960 Speaker 1: paying their rent, keep putting food on the table during 149 00:08:04,000 --> 00:08:08,520 Speaker 1: this period, and then ideally go back to their old jobs. 150 00:08:08,600 --> 00:08:11,840 Speaker 1: And we sort of do that bridge from the past 151 00:08:11,880 --> 00:08:13,880 Speaker 1: to the future. Well, so what is what is the 152 00:08:13,920 --> 00:08:16,560 Speaker 1: ideal of what would the idea of approach been do? So, 153 00:08:16,760 --> 00:08:18,600 Speaker 1: you know, for you and your listeners, how I would 154 00:08:18,640 --> 00:08:22,160 Speaker 1: imagine this is a two two dimensional grid and the 155 00:08:22,320 --> 00:08:26,880 Speaker 1: X axis is something that says short term and long term, 156 00:08:27,480 --> 00:08:31,360 Speaker 1: and the y axis is bottoms up, top down. Look, 157 00:08:31,400 --> 00:08:34,240 Speaker 1: for the last forty to fifty years, we've always believed that, 158 00:08:34,640 --> 00:08:37,680 Speaker 1: you know, a top down reallocation of wealth was the 159 00:08:37,720 --> 00:08:40,480 Speaker 1: only way trickle down economics that was really you know, 160 00:08:40,559 --> 00:08:43,400 Speaker 1: started by Reagan and frankly hasn't changed very much since 161 00:08:43,559 --> 00:08:47,000 Speaker 1: in any presidency thereafter, to be completely honest, um, and 162 00:08:47,040 --> 00:08:49,719 Speaker 1: we've never believed that bottoms up actually works. What I 163 00:08:49,720 --> 00:08:53,240 Speaker 1: would have advocated for was a lot more short term 164 00:08:53,600 --> 00:08:56,880 Speaker 1: bottoms up help, and I think what that looks like 165 00:08:57,360 --> 00:09:01,520 Speaker 1: is guaranteeing wages for basically a lot of individual people 166 00:09:01,600 --> 00:09:03,559 Speaker 1: that would have been put out of work and making 167 00:09:03,600 --> 00:09:07,320 Speaker 1: sure that they have complete financial security to at a 168 00:09:07,360 --> 00:09:11,760 Speaker 1: minimum pay their ongoing repeat bills and at a maximum 169 00:09:11,800 --> 00:09:14,600 Speaker 1: to actually be able to pull forward some amount of 170 00:09:14,640 --> 00:09:17,600 Speaker 1: spending that they would otherwise not do. And the reason 171 00:09:17,720 --> 00:09:20,160 Speaker 1: is because you know, we are not a country that 172 00:09:20,240 --> 00:09:23,439 Speaker 1: relies on government spending to drive the economy, although now 173 00:09:24,040 --> 00:09:26,440 Speaker 1: after these last four or five weeks, you know the 174 00:09:26,480 --> 00:09:30,520 Speaker 1: government is responsible for probably fifty of GDP, which is 175 00:09:30,880 --> 00:09:33,520 Speaker 1: you know, a little crazy. So in the short term 176 00:09:33,559 --> 00:09:35,199 Speaker 1: I would have done something that was a lot more 177 00:09:35,240 --> 00:09:37,960 Speaker 1: bottoms up. Some people would call it u B I 178 00:09:37,960 --> 00:09:39,800 Speaker 1: I don't think we need to label it, but I 179 00:09:39,800 --> 00:09:42,960 Speaker 1: do think that hand money in the hands of consumers 180 00:09:43,040 --> 00:09:45,559 Speaker 1: would have been a much smarter strategy. And then over 181 00:09:45,600 --> 00:09:48,800 Speaker 1: the long term, I do think that top down really 182 00:09:48,840 --> 00:09:52,240 Speaker 1: works and long term change. Top down is all about 183 00:09:52,240 --> 00:09:55,440 Speaker 1: incentives and tax policy, and I think the right thing 184 00:09:55,480 --> 00:09:57,880 Speaker 1: to have done there would actually be to make it 185 00:09:58,360 --> 00:10:02,960 Speaker 1: uh much more profitable and credible for companies to spend 186 00:10:02,960 --> 00:10:05,600 Speaker 1: on things like R and D to you know, not 187 00:10:06,080 --> 00:10:10,520 Speaker 1: fritter away the cash profits they have today via buy backs. 188 00:10:10,880 --> 00:10:13,920 Speaker 1: You know, all these idiotic basically activities, which is the 189 00:10:13,920 --> 00:10:16,559 Speaker 1: tool kid of the dumb CEO. And if you actually 190 00:10:16,600 --> 00:10:20,040 Speaker 1: force some intelligent long term planning and thinking at the 191 00:10:20,080 --> 00:10:23,600 Speaker 1: board level and at the CEO level and tie compensation 192 00:10:23,679 --> 00:10:26,880 Speaker 1: to things that are truly long term versus EPs, you 193 00:10:26,920 --> 00:10:28,920 Speaker 1: would change those incentives as well. So if I was 194 00:10:28,960 --> 00:10:32,120 Speaker 1: the government, I would have spent trillions of dollars on 195 00:10:32,200 --> 00:10:34,520 Speaker 1: giving money to individual citizens, and then I would have 196 00:10:34,600 --> 00:10:39,240 Speaker 1: spent several trillion dollars of tax incentives that told companies, hey, listen, 197 00:10:39,280 --> 00:10:41,560 Speaker 1: I'll give you a short term loan, but in return 198 00:10:41,960 --> 00:10:44,560 Speaker 1: you must sign up for the following idea. You must 199 00:10:44,600 --> 00:10:47,000 Speaker 1: spend at least fifteen or twenty percent of your profits 200 00:10:47,000 --> 00:10:50,240 Speaker 1: on R and D. You must actually say fifteen in 201 00:10:50,280 --> 00:10:53,240 Speaker 1: a rainy day account for the future. You must guarantee 202 00:10:53,280 --> 00:10:55,400 Speaker 1: the pensions. There are all these things that you could 203 00:10:55,400 --> 00:10:57,600 Speaker 1: have done. None of those things were done. You know 204 00:10:57,679 --> 00:11:00,520 Speaker 1: two thirds of the SMP five hundred do have an 205 00:11:00,600 --> 00:11:04,400 Speaker 1: R and D budget. How is that possible? I definitely 206 00:11:04,400 --> 00:11:06,760 Speaker 1: want to talk about the idea of the idiot CEO 207 00:11:06,920 --> 00:11:09,880 Speaker 1: manufacturing short term EPs growth, but just before we do. 208 00:11:10,120 --> 00:11:13,040 Speaker 1: When it comes to government policy, it did feel like 209 00:11:13,400 --> 00:11:15,920 Speaker 1: there was a sense that in the worst of the crisis, 210 00:11:16,400 --> 00:11:19,760 Speaker 1: people were trying to act relatively fast. And when people 211 00:11:19,800 --> 00:11:22,080 Speaker 1: like that are trying to act relatively fast within a 212 00:11:22,200 --> 00:11:25,800 Speaker 1: very defined political system, they tend to reach for things 213 00:11:25,880 --> 00:11:29,640 Speaker 1: that already exist, or they reach for fiscal tools that 214 00:11:29,679 --> 00:11:35,400 Speaker 1: they've used before. How would you encourage politicians specifically to think, 215 00:11:35,760 --> 00:11:38,640 Speaker 1: you know, slightly more creatively when they faced this sort 216 00:11:38,679 --> 00:11:42,400 Speaker 1: of time sensitive crisis and start thinking about new ways 217 00:11:42,720 --> 00:11:46,600 Speaker 1: of tackling the idea or tackling the problem. Well, the 218 00:11:46,640 --> 00:11:49,080 Speaker 1: things that we did were actually completely novel and new. 219 00:11:49,520 --> 00:11:52,480 Speaker 1: U b I wasn't a concept that existed until you know, 220 00:11:52,520 --> 00:11:56,760 Speaker 1: we decided to give to every uh, every American. You know. 221 00:11:56,880 --> 00:11:59,600 Speaker 1: We we had no concept that the FED would be 222 00:11:59,640 --> 00:12:02,400 Speaker 1: impowered or to basically use a bunch of cash, lever 223 00:12:02,520 --> 00:12:05,240 Speaker 1: it up and enter the capital markets and by debt 224 00:12:05,320 --> 00:12:07,719 Speaker 1: of all kinds of maturities to be able to pick 225 00:12:07,760 --> 00:12:10,560 Speaker 1: off you know, debt that's actually you know, degraded in 226 00:12:10,720 --> 00:12:13,760 Speaker 1: quality and credit worthiness to buy e t s. These 227 00:12:13,760 --> 00:12:15,679 Speaker 1: were all new things that none of US had ever 228 00:12:15,679 --> 00:12:19,560 Speaker 1: seen before. So I think that they know clearly invented things. 229 00:12:19,640 --> 00:12:35,400 Speaker 1: I just wish they would have invented smarter things. When 230 00:12:35,480 --> 00:12:39,240 Speaker 1: I ever I saw your your interview a Railian against 231 00:12:39,240 --> 00:12:43,320 Speaker 1: the bailout, I tweeted something kind of cynical, but I 232 00:12:43,360 --> 00:12:45,840 Speaker 1: also kind of wonder what the deal is. So you're 233 00:12:45,920 --> 00:12:50,320 Speaker 1: the chairman of Virgin Galactic. The ticker is SPC, which 234 00:12:50,400 --> 00:12:53,600 Speaker 1: kind of sounds like space, except that you've said in 235 00:12:53,640 --> 00:12:57,120 Speaker 1: the past that the sort of at least medium term 236 00:12:57,240 --> 00:13:01,200 Speaker 1: likely business model is something that can heat's not actually 237 00:13:01,200 --> 00:13:04,800 Speaker 1: going into space, but terrestrial travel that could be like 238 00:13:04,840 --> 00:13:10,520 Speaker 1: a much better version of business class, much faster, potentially 239 00:13:10,960 --> 00:13:15,160 Speaker 1: more economical than traditional business class. Do you feel that 240 00:13:15,240 --> 00:13:19,200 Speaker 1: you have a incentive or that you the company of 241 00:13:19,320 --> 00:13:22,640 Speaker 1: which your chairman is a competitor of these companies that 242 00:13:22,760 --> 00:13:25,920 Speaker 1: you were calling out against their bailout. You know, we 243 00:13:25,920 --> 00:13:28,000 Speaker 1: we have a lot of work to do before we 244 00:13:28,040 --> 00:13:30,280 Speaker 1: build a hypersonic airplane. And just to give you a 245 00:13:30,320 --> 00:13:33,160 Speaker 1: sense of it, um, a hypersonic airplane is something that 246 00:13:33,200 --> 00:13:36,160 Speaker 1: flies at nine to a hundred and ten thousand, hundred 247 00:13:36,120 --> 00:13:38,440 Speaker 1: and twenty thousand feet. The spaceship that we have today 248 00:13:38,480 --> 00:13:42,480 Speaker 1: flies up to three fifty feet. So we're in the 249 00:13:42,520 --> 00:13:44,920 Speaker 1: business of spaceships, and we will be for a very 250 00:13:44,960 --> 00:13:48,000 Speaker 1: long time. It's just that when you're in space, the 251 00:13:48,040 --> 00:13:51,080 Speaker 1: physics are such that flying from here to Beijing is 252 00:13:51,080 --> 00:13:53,360 Speaker 1: not nearly as troublesome as when you're flying at thirty 253 00:13:53,360 --> 00:13:56,880 Speaker 1: thousand feet. And so obviously long term, you know, we 254 00:13:56,960 --> 00:13:59,880 Speaker 1: can enable a different form of travel that's not possible 255 00:14:00,360 --> 00:14:03,960 Speaker 1: by basically going so high into the into the atmosphere 256 00:14:04,240 --> 00:14:07,640 Speaker 1: that a lot of the practical difficulties of traditional planes 257 00:14:08,080 --> 00:14:10,440 Speaker 1: are not the problems that we would face. But I 258 00:14:10,520 --> 00:14:12,640 Speaker 1: really do firmly believe we're in the business of spaceship. 259 00:14:12,640 --> 00:14:15,200 Speaker 1: It's just that those spaceships can be used for a 260 00:14:15,240 --> 00:14:18,800 Speaker 1: whole host of different applications, including point to point what 261 00:14:18,880 --> 00:14:20,680 Speaker 1: you call that. I guess we can get sonantic and 262 00:14:20,760 --> 00:14:23,680 Speaker 1: call it an airplane if you want. So you are 263 00:14:23,800 --> 00:14:25,760 Speaker 1: kind of in I mean in theory in terms of 264 00:14:25,760 --> 00:14:31,600 Speaker 1: like a revenue model, they would be your competitive Maybe 265 00:14:32,520 --> 00:14:35,120 Speaker 1: just on one more cynical note, but you're talking about 266 00:14:35,600 --> 00:14:38,840 Speaker 1: government policy. Sorry, sorry to throw this all out at 267 00:14:38,840 --> 00:14:41,200 Speaker 1: you at the beginning, but um, you're talking about government 268 00:14:41,200 --> 00:14:46,360 Speaker 1: policy and central bank policy distorting economies and potentially distorting markets. 269 00:14:46,760 --> 00:14:50,040 Speaker 1: A lot of people would say that venture capital has 270 00:14:50,160 --> 00:14:54,600 Speaker 1: benefited enormously from the kind of central bank liquidity that 271 00:14:54,640 --> 00:14:57,680 Speaker 1: we've seen in recent years, and that because of it, 272 00:14:57,720 --> 00:15:00,800 Speaker 1: you've had a lot of money that can continuously fund 273 00:15:00,840 --> 00:15:04,520 Speaker 1: a lot of loss making tech enterprise. How do how 274 00:15:04,520 --> 00:15:08,760 Speaker 1: do you respond to that? Yeah, you're right. I mean 275 00:15:08,880 --> 00:15:11,720 Speaker 1: there's there's no point putting lipstick on a pig. Like 276 00:15:11,880 --> 00:15:14,960 Speaker 1: let's let's be honest about what's happened. You know, starting 277 00:15:15,000 --> 00:15:17,040 Speaker 1: in two thousand and eight and two thousand and nine, 278 00:15:17,440 --> 00:15:20,960 Speaker 1: we printed an enormous amount of money. The United States 279 00:15:20,960 --> 00:15:26,360 Speaker 1: government stepped into financial markets and basically told investors, listen, 280 00:15:26,680 --> 00:15:28,880 Speaker 1: I'm going to take the things that you have and 281 00:15:28,960 --> 00:15:32,520 Speaker 1: give you U S dollars in return. Those investors, in 282 00:15:32,560 --> 00:15:35,960 Speaker 1: turn took those US dollars and said, well, I can 283 00:15:36,000 --> 00:15:39,440 Speaker 1: do three things with it. One is nothing, two as 284 00:15:39,480 --> 00:15:41,800 Speaker 1: I can buy bonds, or three as I can buy stocks. 285 00:15:42,800 --> 00:15:45,400 Speaker 1: And what has happened is we've had the most incredible 286 00:15:45,480 --> 00:15:49,640 Speaker 1: market that we've ever seen. Along with that, what that 287 00:15:49,720 --> 00:15:54,160 Speaker 1: gives investors is an enormous amount of confidence because they 288 00:15:54,160 --> 00:15:57,400 Speaker 1: will conflate luck and skill. They think that they were 289 00:15:57,440 --> 00:16:01,960 Speaker 1: geniuses in picking stocks, and we don't really you know, 290 00:16:02,320 --> 00:16:04,920 Speaker 1: take into account is we we have this huge behemoth 291 00:16:04,960 --> 00:16:07,920 Speaker 1: behind us, you know, giving us a massive tail wind 292 00:16:08,840 --> 00:16:11,320 Speaker 1: in that. What happened was a bunch of you know, 293 00:16:11,600 --> 00:16:15,560 Speaker 1: um investors decided that they needed more liquid exposure to 294 00:16:15,600 --> 00:16:18,520 Speaker 1: get even better returns, and so they pumped enormous amounts 295 00:16:18,520 --> 00:16:21,400 Speaker 1: of money in private equity. Now what did those private 296 00:16:21,440 --> 00:16:23,960 Speaker 1: equity companies do. They went back and issued more debt, 297 00:16:23,960 --> 00:16:28,120 Speaker 1: bought companies, fired people, you know, pillaged balance sheets. They 298 00:16:28,160 --> 00:16:31,440 Speaker 1: also then decided that venture looked interesting, and they tripled 299 00:16:31,440 --> 00:16:33,760 Speaker 1: and quadrupled the amount of money that's gone into venture. 300 00:16:34,160 --> 00:16:36,640 Speaker 1: What do venture capitalists do? They respond to those market 301 00:16:36,680 --> 00:16:40,000 Speaker 1: dynamics and they raise larger and larger funds, doing dumber 302 00:16:40,000 --> 00:16:42,000 Speaker 1: and dumber things so that they can get the money 303 00:16:42,000 --> 00:16:46,320 Speaker 1: while the getting is good. I mean, this, this problem 304 00:16:46,360 --> 00:16:51,440 Speaker 1: of people very quickly reverting to lowest common denominator behavior 305 00:16:51,760 --> 00:16:54,320 Speaker 1: in search for money is tried and tested and true 306 00:16:54,360 --> 00:16:56,560 Speaker 1: and has been true for hundreds of years. And you know, 307 00:16:56,600 --> 00:16:58,840 Speaker 1: I don't think venture capitalists are any more virtuous than 308 00:16:58,880 --> 00:17:02,120 Speaker 1: anybody else. And so that's absolutely what they did. But 309 00:17:02,200 --> 00:17:03,880 Speaker 1: if you trace it all back. How did it start? 310 00:17:03,960 --> 00:17:07,280 Speaker 1: It started with the United States government deciding to print 311 00:17:07,280 --> 00:17:10,880 Speaker 1: trillions of dollars. Now, ask yourself, what happens in two 312 00:17:10,960 --> 00:17:13,239 Speaker 1: thousand and twenty five when you look back at two 313 00:17:13,320 --> 00:17:17,600 Speaker 1: thousand and twenty and realized that, you know, we printed eight, nine, 314 00:17:17,640 --> 00:17:20,280 Speaker 1: ten trillion dollars. When it's all said and done, almost 315 00:17:20,280 --> 00:17:23,359 Speaker 1: fifty of a year's worth of GDP UM. So, whatever 316 00:17:23,400 --> 00:17:26,080 Speaker 1: has happened in the last ten years, I suspect in 317 00:17:26,119 --> 00:17:31,760 Speaker 1: the absence of some cataclysmic market realization, um, we are 318 00:17:31,800 --> 00:17:35,000 Speaker 1: we are going to go to heights that you didn't 319 00:17:35,000 --> 00:17:39,400 Speaker 1: think were possible from you Well, let's talk about right now. 320 00:17:39,480 --> 00:17:43,280 Speaker 1: So obviously you have a lot of different purchase via 321 00:17:43,359 --> 00:17:48,800 Speaker 1: which you see the economy. Early June, most people would say, okay, 322 00:17:48,840 --> 00:17:52,440 Speaker 1: things are not as dire looking as they were in uh, 323 00:17:52,560 --> 00:17:55,959 Speaker 1: early April. But how from your various businesses and your 324 00:17:56,040 --> 00:17:59,320 Speaker 1: various roles including sports and so forth, what's your assessment 325 00:17:59,440 --> 00:18:02,080 Speaker 1: of the economy me and its trajectory? And you feel 326 00:18:02,119 --> 00:18:05,080 Speaker 1: like we're on a path regardless of the incentives that 327 00:18:05,119 --> 00:18:10,480 Speaker 1: policies created towards something resembling the pre crisis economy, or 328 00:18:10,520 --> 00:18:12,000 Speaker 1: were still a long way from that in your view. 329 00:18:12,320 --> 00:18:15,399 Speaker 1: So the first thing to remember is that typically the 330 00:18:15,400 --> 00:18:17,679 Speaker 1: way that markets behave in the face of a recession 331 00:18:18,280 --> 00:18:20,359 Speaker 1: is can be can be sort of seen over about 332 00:18:20,480 --> 00:18:23,919 Speaker 1: six quarters. I'm just gonna make the math simple. Six quarters. 333 00:18:24,000 --> 00:18:26,160 Speaker 1: And in the first two to three quarters the markets 334 00:18:26,200 --> 00:18:29,600 Speaker 1: trade down, and they trade down because people are trying 335 00:18:29,600 --> 00:18:31,879 Speaker 1: to figure out when the bottom is, and you know, 336 00:18:31,920 --> 00:18:34,600 Speaker 1: the economy is contracting, and then it's contracting a little 337 00:18:34,600 --> 00:18:36,840 Speaker 1: bit more, and then it contracts yet a little bit more. 338 00:18:37,520 --> 00:18:40,080 Speaker 1: But it's that last quarter where we have been taught 339 00:18:40,119 --> 00:18:43,119 Speaker 1: as normal traditional market participants in the middle of a 340 00:18:43,160 --> 00:18:47,199 Speaker 1: recession to buy and that's the term. And then you 341 00:18:47,240 --> 00:18:49,639 Speaker 1: get the next two or three quarters of massive ripping 342 00:18:49,640 --> 00:18:52,600 Speaker 1: equity prices, and then the economy returns to normal and 343 00:18:52,600 --> 00:18:56,160 Speaker 1: then you get back to judging companies based on normalized elearnings. 344 00:18:56,320 --> 00:18:59,080 Speaker 1: If you had said a priority this event, how would 345 00:18:59,080 --> 00:19:01,280 Speaker 1: people react to our session, That's what they would have said. 346 00:19:01,320 --> 00:19:03,200 Speaker 1: They would have said, Okay, we are in for two 347 00:19:03,240 --> 00:19:05,560 Speaker 1: to three quarters of a draw down and then uh, 348 00:19:05,600 --> 00:19:07,400 Speaker 1: you know, the markets will turn and rip back over 349 00:19:07,400 --> 00:19:10,280 Speaker 1: two to three quarters. Instead, what we did was shut 350 00:19:10,320 --> 00:19:12,439 Speaker 1: down the economy and we took it to zero. So 351 00:19:12,520 --> 00:19:15,280 Speaker 1: from a very basic level, it actually couldn't get any 352 00:19:15,320 --> 00:19:18,560 Speaker 1: worse than the first quarter. And you know when then 353 00:19:18,600 --> 00:19:20,480 Speaker 1: you again supercharge it with all the money that the 354 00:19:20,520 --> 00:19:22,439 Speaker 1: Fed gave us. This is why we've had such a 355 00:19:22,880 --> 00:19:26,960 Speaker 1: such an indiscriminate rally going into early June. Now all 356 00:19:27,000 --> 00:19:31,200 Speaker 1: of that said, my large and more broader market framework 357 00:19:31,400 --> 00:19:34,320 Speaker 1: still applies, which is at their thrip, typically three phases 358 00:19:34,320 --> 00:19:36,560 Speaker 1: of a market. And the way that I think about 359 00:19:36,600 --> 00:19:40,240 Speaker 1: it is, at first, you reflect the worst and everybody 360 00:19:40,280 --> 00:19:42,840 Speaker 1: assumes the worst, and you have to basically manage to 361 00:19:42,880 --> 00:19:48,200 Speaker 1: the absolute worst case scenario. But that's all psychological, and 362 00:19:48,440 --> 00:19:50,800 Speaker 1: in all of that, what happens is people realize that 363 00:19:50,840 --> 00:19:54,080 Speaker 1: they overreacted, as they always do. And then what happens 364 00:19:54,160 --> 00:19:56,399 Speaker 1: is you start phase two, which is you priced the news, 365 00:19:57,240 --> 00:19:58,920 Speaker 1: and what that means is you become a little bit 366 00:19:58,920 --> 00:20:01,879 Speaker 1: more sober, you become a little bit more thoughtful, You 367 00:20:01,920 --> 00:20:04,240 Speaker 1: take a little bit more time, and you try to 368 00:20:04,280 --> 00:20:07,560 Speaker 1: really understand what's happening and try to really weigh the 369 00:20:07,600 --> 00:20:09,920 Speaker 1: balance of things that are happening and be a little 370 00:20:09,920 --> 00:20:13,159 Speaker 1: bit more judicious in your decision making. And then you 371 00:20:13,240 --> 00:20:15,480 Speaker 1: enter the third phase, which is then you harvest profits, 372 00:20:15,880 --> 00:20:18,280 Speaker 1: and you can be harvesting profits for a year, for 373 00:20:18,400 --> 00:20:20,680 Speaker 1: ten years. You know, you could wait till the last 374 00:20:20,800 --> 00:20:22,560 Speaker 1: month of the tenth year. But the point is that 375 00:20:22,600 --> 00:20:25,480 Speaker 1: then you're really in a position where markets are trending 376 00:20:25,560 --> 00:20:28,439 Speaker 1: higher and you can safely be a holder and a 377 00:20:28,520 --> 00:20:31,480 Speaker 1: net seller and make money. I think where we are 378 00:20:31,560 --> 00:20:33,320 Speaker 1: is we're in the middle of phase one and two. 379 00:20:33,960 --> 00:20:37,560 Speaker 1: We reflected the worst in March, and what we're still 380 00:20:37,560 --> 00:20:40,520 Speaker 1: trying to find is our version of the truth, and 381 00:20:40,600 --> 00:20:43,400 Speaker 1: so we're testing theories in the marketplace right now. We're 382 00:20:43,440 --> 00:20:46,159 Speaker 1: pricing the news, trying to see how people react. So 383 00:20:46,280 --> 00:20:49,000 Speaker 1: we just spent the last six weeks pricing the news, 384 00:20:49,880 --> 00:20:52,000 Speaker 1: which is that there's a v shape recovery and everything 385 00:20:52,080 --> 00:20:55,240 Speaker 1: is going to be great. Uh, then you know, George 386 00:20:55,240 --> 00:20:59,520 Speaker 1: Floyd happened, and it's unlocked a level of discomfort in 387 00:20:59,560 --> 00:21:02,520 Speaker 1: the in the again, the real world, we've had a 388 00:21:02,560 --> 00:21:05,320 Speaker 1: spike in coronavirus cases in the last two to three weeks, 389 00:21:05,359 --> 00:21:06,960 Speaker 1: and I think now the market is going to price 390 00:21:06,960 --> 00:21:09,159 Speaker 1: a different kind of news, which is that this is 391 00:21:09,160 --> 00:21:11,679 Speaker 1: going to be tumultuous and that it's not going to 392 00:21:11,720 --> 00:21:15,040 Speaker 1: be a clean recovery and that there's a lot more 393 00:21:15,160 --> 00:21:18,200 Speaker 1: uncertainty to come. And I think that over the next 394 00:21:18,200 --> 00:21:20,320 Speaker 1: probably two to three weeks, we're going to play around 395 00:21:20,320 --> 00:21:23,080 Speaker 1: with that model of how the market should work to 396 00:21:23,160 --> 00:21:26,640 Speaker 1: see if that works. In general, my perspective is that 397 00:21:27,160 --> 00:21:30,360 Speaker 1: unfortunately for us, the amount of money that the Fed 398 00:21:30,520 --> 00:21:35,719 Speaker 1: is printed mutes and masks any of these things, and 399 00:21:35,800 --> 00:21:40,200 Speaker 1: so the tendency will be for the markets to trend 400 00:21:40,280 --> 00:21:44,720 Speaker 1: higher going into the fall, into the election, just zooming 401 00:21:44,720 --> 00:21:48,640 Speaker 1: out from markets. Uh. In one of your investor newsletters, 402 00:21:48,840 --> 00:21:51,520 Speaker 1: you were talking about how you were viewing a sort 403 00:21:51,560 --> 00:21:55,359 Speaker 1: of parallel with with what's happening now and a moment 404 00:21:55,400 --> 00:21:59,080 Speaker 1: in time from US history, which was the Gilded Age. 405 00:21:59,400 --> 00:22:01,480 Speaker 1: Can you walk us through that parallel, because I think 406 00:22:01,520 --> 00:22:05,159 Speaker 1: it's really interesting, Um, you know, the Gilded Age? Uh. 407 00:22:05,240 --> 00:22:08,400 Speaker 1: And basically this is the late eighteen eighteen hundreds, turn 408 00:22:08,400 --> 00:22:10,359 Speaker 1: of the turn of the nineteen hundreds. What we saw 409 00:22:10,600 --> 00:22:14,240 Speaker 1: was a handful of industries really represent all the success 410 00:22:14,240 --> 00:22:17,960 Speaker 1: in the world, specifically the railroads, and a handful of 411 00:22:18,400 --> 00:22:22,840 Speaker 1: industrialists that were personified with both greed and villainy in 412 00:22:22,880 --> 00:22:25,840 Speaker 1: many ways for being at the center of those industries 413 00:22:26,200 --> 00:22:28,520 Speaker 1: and it's not dissimilar to how tech is viewed or 414 00:22:28,560 --> 00:22:32,280 Speaker 1: has been viewed going into this pandemic. But what really 415 00:22:32,320 --> 00:22:36,119 Speaker 1: happened was, you know, there was there was pushback against immigrants, 416 00:22:36,119 --> 00:22:38,840 Speaker 1: there was pushback against women's rights, there was pushback against 417 00:22:38,920 --> 00:22:42,159 Speaker 1: labor organization. But eventually what happened was there was a 418 00:22:42,200 --> 00:22:46,320 Speaker 1: pushback against trust busting. There was you know, a movement 419 00:22:46,440 --> 00:22:51,760 Speaker 1: for labor rights, for women's rights, for immigrants, for high schools. 420 00:22:51,760 --> 00:22:54,320 Speaker 1: You know, organized high schools didn't exist until the late 421 00:22:54,359 --> 00:22:57,960 Speaker 1: eighteen hundreds, etcetera. All of this is to say that, 422 00:22:58,080 --> 00:23:01,320 Speaker 1: you know, we sort of had a short term bottoming 423 00:23:01,880 --> 00:23:06,159 Speaker 1: in the pure form of capitalism that had preceded it, 424 00:23:06,560 --> 00:23:10,200 Speaker 1: and we layered capitalism with a lot more social consciousness. 425 00:23:10,720 --> 00:23:13,080 Speaker 1: And I believe that we're in that progression right now, 426 00:23:13,280 --> 00:23:15,199 Speaker 1: and I think that you know, in the next four years, 427 00:23:15,520 --> 00:23:18,760 Speaker 1: it really irrespective of which whoever holds the presidency between 428 00:23:20,800 --> 00:23:24,960 Speaker 1: is the bottoming of the top down, trickle down economic process, 429 00:23:25,040 --> 00:23:29,359 Speaker 1: you know, largely defined by a gerontocracy who will eventually 430 00:23:29,400 --> 00:23:32,600 Speaker 1: recede into the you know, annals of history and will 431 00:23:32,640 --> 00:23:35,800 Speaker 1: be replaced by young progressives on both the right and 432 00:23:35,880 --> 00:23:39,440 Speaker 1: the left, and so by four and beyond through I 433 00:23:39,440 --> 00:23:43,760 Speaker 1: think we're gonna see a rise in progressive ideals and 434 00:23:43,920 --> 00:23:50,520 Speaker 1: arise in social consciousness, a more responsible approach that looks 435 00:23:50,560 --> 00:23:54,399 Speaker 1: at every human inside of the United States as roughly 436 00:23:54,520 --> 00:23:58,119 Speaker 1: equal and asks ourselves what we have to do. A 437 00:23:58,160 --> 00:24:03,200 Speaker 1: lot more trust busting of big companies, higher taxes for companies. 438 00:24:03,560 --> 00:24:06,280 Speaker 1: All of those things I think are in there are 439 00:24:06,400 --> 00:24:08,119 Speaker 1: sort of like, you know, what I expect to happen 440 00:24:08,160 --> 00:24:11,640 Speaker 1: over the next five to ten years. Let's talk about 441 00:24:11,680 --> 00:24:15,080 Speaker 1: that further, particularly from the perspective of the tech world. 442 00:24:15,440 --> 00:24:19,080 Speaker 1: You're at Facebook for a long time. Facebook is in 443 00:24:19,160 --> 00:24:22,720 Speaker 1: many ways at the center of a lot of these 444 00:24:23,160 --> 00:24:26,680 Speaker 1: a lot of these tensions because so much information flows 445 00:24:26,720 --> 00:24:31,119 Speaker 1: through Facebook. There's tension with inside Facebook, different views on 446 00:24:31,160 --> 00:24:34,639 Speaker 1: how it should regulate itself and regulate speech, or how 447 00:24:34,680 --> 00:24:37,480 Speaker 1: much it should just be a completely open platform. There's 448 00:24:37,480 --> 00:24:39,840 Speaker 1: also you mentioned trust busting. I'm sure I know there's 449 00:24:39,840 --> 00:24:42,800 Speaker 1: a lot of people who want Facebook to be broken up. 450 00:24:42,840 --> 00:24:46,880 Speaker 1: But give us your take on Facebook's role right now 451 00:24:47,480 --> 00:24:50,840 Speaker 1: and how it should first of all, how internally, how 452 00:24:50,880 --> 00:24:54,440 Speaker 1: management should be in your view, addressing some of these 453 00:24:54,480 --> 00:24:57,200 Speaker 1: thorny issues about what it should allow on his platform, 454 00:24:57,280 --> 00:25:01,240 Speaker 1: and then also perhaps your view on what a policy standpoint, 455 00:25:01,400 --> 00:25:04,960 Speaker 1: the rest of society, politicians and I trust experts should 456 00:25:05,359 --> 00:25:08,040 Speaker 1: how it should go about regulating placebook. Let me answer 457 00:25:08,040 --> 00:25:12,359 Speaker 1: it in the context of all of big tech, so Google, Facebook, Apple, Amazon, Microsoft. 458 00:25:12,400 --> 00:25:16,600 Speaker 1: To my answer is that these guys should, um try 459 00:25:16,640 --> 00:25:20,600 Speaker 1: to continue to build the most value for consumers and 460 00:25:20,800 --> 00:25:24,399 Speaker 1: try to give as much of that away as cheaply 461 00:25:24,520 --> 00:25:27,200 Speaker 1: or as freely as possible, because it is the only 462 00:25:27,280 --> 00:25:31,240 Speaker 1: path to maintain consumer loyalty. Um. You know, the tech 463 00:25:31,440 --> 00:25:36,800 Speaker 1: sector has largely been responsible for a decade of deflation. 464 00:25:37,359 --> 00:25:40,120 Speaker 1: You know, they have taught consumers not to spend money 465 00:25:40,160 --> 00:25:43,200 Speaker 1: because you get great things for free, and tomorrow you'll 466 00:25:43,240 --> 00:25:45,560 Speaker 1: get even more great things for free. That's an inherently 467 00:25:45,640 --> 00:25:49,320 Speaker 1: deflationary set of behaviors and dynamics that that largely the 468 00:25:49,359 --> 00:25:52,520 Speaker 1: tech the tech industry has created. The other reality, those 469 00:25:52,600 --> 00:25:56,119 Speaker 1: that governments, I think have two very practical issues. The 470 00:25:56,200 --> 00:26:00,400 Speaker 1: first is that big tech threatens their ability to govern, 471 00:26:00,560 --> 00:26:04,560 Speaker 1: and the second is that big tech is collectively more 472 00:26:04,680 --> 00:26:10,120 Speaker 1: economically viable than most governments. And so what you see now, 473 00:26:10,560 --> 00:26:13,520 Speaker 1: for example, if you look in Australia, is a much 474 00:26:13,560 --> 00:26:17,600 Speaker 1: more aggressive taxation and policy regime in Europe, a much 475 00:26:17,640 --> 00:26:22,120 Speaker 1: more aggressive taxation and policy regime. Um, we've heard that 476 00:26:22,440 --> 00:26:25,600 Speaker 1: the fifty A G s plus the federal dj who 477 00:26:25,720 --> 00:26:28,159 Speaker 1: seemingly couldn't agree on anything, has agreed to try to 478 00:26:28,200 --> 00:26:31,040 Speaker 1: trust Bus Google. You know, in France, they tried to 479 00:26:31,160 --> 00:26:35,119 Speaker 1: tax Amazon or they're going to tax you know, the 480 00:26:35,119 --> 00:26:38,320 Speaker 1: dollars that they make their through Amazon Prime. So this 481 00:26:38,400 --> 00:26:41,359 Speaker 1: is the beginning of this trend. You know, local, state 482 00:26:41,440 --> 00:26:44,000 Speaker 1: and federal governments all around the world are the poorest 483 00:26:44,119 --> 00:26:47,120 Speaker 1: they've ever been, and these five or six companies are 484 00:26:47,119 --> 00:26:50,480 Speaker 1: the richest they've ever been, and so it sets them 485 00:26:50,480 --> 00:26:55,760 Speaker 1: on a collision course. That's pretty obvious, and what I 486 00:26:55,800 --> 00:26:58,800 Speaker 1: think the markets are doing right now is trying to 487 00:26:58,840 --> 00:27:02,639 Speaker 1: fight the obvious. If you look at, for example, the 488 00:27:02,640 --> 00:27:07,000 Speaker 1: the weighted SNPI market cap versus the unweighted, what that 489 00:27:07,040 --> 00:27:09,680 Speaker 1: means is every company is worth the same versus every 490 00:27:09,720 --> 00:27:13,679 Speaker 1: company is worth what their market cap is worth. The 491 00:27:13,760 --> 00:27:19,320 Speaker 1: weighted market cap has completely dispersed from the unweighted, which 492 00:27:19,320 --> 00:27:20,960 Speaker 1: is to say that, you know, the big five tech 493 00:27:21,000 --> 00:27:23,760 Speaker 1: companies have completely ripped and the rest of you know, 494 00:27:23,800 --> 00:27:27,000 Speaker 1: the four other companies in the SNP five have been 495 00:27:27,080 --> 00:27:30,000 Speaker 1: kind of sitting on their hands. And the reason why 496 00:27:30,040 --> 00:27:33,359 Speaker 1: that lollygagging is happening in the capital markets is that 497 00:27:34,040 --> 00:27:37,720 Speaker 1: market participants don't want to believe that it's true that 498 00:27:37,840 --> 00:27:42,280 Speaker 1: the future profitability and long term profit capture of these 499 00:27:42,280 --> 00:27:45,800 Speaker 1: businesses will stay intact. The practical reality is that when 500 00:27:45,880 --> 00:27:48,119 Speaker 1: you look at what's happening, just by reading the news, 501 00:27:48,160 --> 00:27:50,640 Speaker 1: you can see that, you know, there's not much recourse 502 00:27:50,680 --> 00:27:53,679 Speaker 1: for these companies over time once the government decides that 503 00:27:53,720 --> 00:27:56,240 Speaker 1: they're going to get their pound of flesh. So it's 504 00:27:56,280 --> 00:27:58,640 Speaker 1: pretty obvious from my perspective. I don't think that it's 505 00:27:58,680 --> 00:28:02,440 Speaker 1: the consensus you um, but if you know, if you 506 00:28:02,560 --> 00:28:05,360 Speaker 1: had to basically trade that news, what I would tell 507 00:28:05,359 --> 00:28:09,080 Speaker 1: you is that you're over time, especially as we rally, 508 00:28:09,160 --> 00:28:12,919 Speaker 1: you'll see more dispersion of these five companies relative to 509 00:28:12,920 --> 00:28:14,840 Speaker 1: the rest. And that's when you want to get short, 510 00:28:14,920 --> 00:28:18,160 Speaker 1: because that's when the the spread will collapse at some point, 511 00:28:18,160 --> 00:28:23,159 Speaker 1: when enough of these lawsuits basically you know, trigger a 512 00:28:23,400 --> 00:28:26,440 Speaker 1: realization that a bunch of these things will get broken 513 00:28:26,520 --> 00:28:29,199 Speaker 1: up and taxed and over taxed, and it's just going 514 00:28:29,240 --> 00:28:32,880 Speaker 1: to be an ugly position I think for big tech overtime. 515 00:28:33,600 --> 00:28:38,120 Speaker 1: So you're talking about obviously inequality in society, but also 516 00:28:38,240 --> 00:28:42,520 Speaker 1: inequality in companies, you know, between the big ones like 517 00:28:42,560 --> 00:28:45,080 Speaker 1: the Thing stocks and some of the others, And you 518 00:28:45,120 --> 00:28:47,760 Speaker 1: think eventually a lot of that is sort of going 519 00:28:47,800 --> 00:28:51,120 Speaker 1: to get worked on or worked out in a similar 520 00:28:51,120 --> 00:28:53,960 Speaker 1: way to what we saw I guess during the progressive 521 00:28:53,960 --> 00:28:57,600 Speaker 1: era after the Gilded Ages. That sort of the thesis 522 00:28:58,880 --> 00:29:00,440 Speaker 1: UM in some ways. Yeah, I mean I don't think. 523 00:29:00,480 --> 00:29:02,880 Speaker 1: I don't think it's going to look exactly the same UM. 524 00:29:02,920 --> 00:29:05,760 Speaker 1: Like I said, I think that you know, at that time, 525 00:29:06,520 --> 00:29:09,400 Speaker 1: these were all domestic companies with domestic motives, and there 526 00:29:09,440 --> 00:29:12,640 Speaker 1: were fewer actors to really manage. This time around, you're 527 00:29:12,640 --> 00:29:16,360 Speaker 1: talking about global companies with um you know, global balance 528 00:29:16,400 --> 00:29:19,640 Speaker 1: sheets and hundreds of regulators you know, up and down 529 00:29:19,720 --> 00:29:23,040 Speaker 1: the value chain at the federal, state, and local level 530 00:29:23,080 --> 00:29:26,200 Speaker 1: all around the world that will want their pound of flesh. 531 00:29:26,480 --> 00:29:42,960 Speaker 1: So it's just inevitable. From the internal side, How do 532 00:29:43,000 --> 00:29:45,880 Speaker 1: you think Mark Zuckerberg or some of these CEOs who 533 00:29:46,120 --> 00:29:48,880 Speaker 1: are trying to wrestle this very strange role in which 534 00:29:48,880 --> 00:29:52,760 Speaker 1: they're sort of de facto governments unto themselves, who have 535 00:29:52,880 --> 00:29:56,600 Speaker 1: to set norms and their own lines of what they 536 00:29:56,600 --> 00:30:00,960 Speaker 1: think is appropriate speech. How should they go about adjudicating 537 00:30:01,040 --> 00:30:02,520 Speaker 1: these questions, because of course there are a lot of 538 00:30:02,520 --> 00:30:04,880 Speaker 1: people inside Facebook that would love to see it. Depends 539 00:30:04,880 --> 00:30:06,400 Speaker 1: on the lens in which you want to view it. 540 00:30:06,440 --> 00:30:09,080 Speaker 1: But if you're running a big tech company, you have 541 00:30:09,120 --> 00:30:13,200 Speaker 1: two options. Option one is um to hold on for 542 00:30:13,280 --> 00:30:17,880 Speaker 1: dear life um and and basically, you know, wait until 543 00:30:18,000 --> 00:30:21,840 Speaker 1: they come knocking. Or option two would be to do 544 00:30:21,920 --> 00:30:24,200 Speaker 1: it yourself so that you can control the outcome better. 545 00:30:24,640 --> 00:30:26,840 Speaker 1: For example, if you take Amazon as an example, you 546 00:30:26,880 --> 00:30:28,880 Speaker 1: could make a case that Amazon could spin out a 547 00:30:29,040 --> 00:30:32,200 Speaker 1: WS into its own entity right now and have some 548 00:30:32,320 --> 00:30:35,040 Speaker 1: kind of an agreement that they define between them and 549 00:30:35,040 --> 00:30:38,360 Speaker 1: and Amazon Retail, versus having it done to them by 550 00:30:38,360 --> 00:30:41,520 Speaker 1: the d J. You know, you could make a claim 551 00:30:41,600 --> 00:30:44,200 Speaker 1: that you know you could spin out Skype from Microsoft, 552 00:30:44,400 --> 00:30:48,120 Speaker 1: or that you know, Gmail and the Google Ads business 553 00:30:48,120 --> 00:30:51,800 Speaker 1: and YouTube should all be three separate entities, each individually 554 00:30:51,800 --> 00:30:56,320 Speaker 1: traded um where you know the agreements and the bilateral 555 00:30:56,360 --> 00:30:59,880 Speaker 1: sharing or trilateral sharing agreements of data are defined by 556 00:31:00,160 --> 00:31:03,120 Speaker 1: them themselves. Or you can just wait and have it 557 00:31:03,160 --> 00:31:09,040 Speaker 1: done to you in the absence of anything else. UM. 558 00:31:09,080 --> 00:31:11,000 Speaker 1: I think it makes all the sense in the world 559 00:31:11,160 --> 00:31:15,640 Speaker 1: to wait. It's not necessarily what is the moral answer, 560 00:31:15,680 --> 00:31:19,600 Speaker 1: and it's not necessarily what the companies or employees may 561 00:31:19,640 --> 00:31:22,120 Speaker 1: want you to do. But it's absolutely the thing that 562 00:31:22,160 --> 00:31:25,280 Speaker 1: maximizes market cap in the short term, because that also 563 00:31:25,360 --> 00:31:29,560 Speaker 1: maximizes your influence in the short term, which then probably 564 00:31:29,600 --> 00:31:31,880 Speaker 1: gives you a sensation that maybe you can change the 565 00:31:31,920 --> 00:31:35,240 Speaker 1: outcome if all this were to happen, if you saw 566 00:31:35,280 --> 00:31:37,440 Speaker 1: some of the big tech giants start to get broken 567 00:31:37,560 --> 00:31:42,680 Speaker 1: up or reined in a little bit, how how harmful 568 00:31:42,840 --> 00:31:45,360 Speaker 1: is that for their business models? I guess I'm asking 569 00:31:45,880 --> 00:31:48,960 Speaker 1: how much of their business model is predicated on having 570 00:31:49,320 --> 00:31:52,960 Speaker 1: basically a monopoly over certain sets of data. Yeah, I 571 00:31:52,960 --> 00:31:56,520 Speaker 1: mean I think that you probably see a whole host 572 00:31:56,600 --> 00:31:59,280 Speaker 1: of other competitors. Look you, you know. The thing to 573 00:31:59,320 --> 00:32:03,880 Speaker 1: keep in mind is that the UM technology ecosystem typically 574 00:32:03,960 --> 00:32:08,080 Speaker 1: has swung, you know, as a pendulum between these two poles. 575 00:32:08,240 --> 00:32:12,480 Speaker 1: Poll number one is, you know, a few companies highly integrated, 576 00:32:13,000 --> 00:32:15,600 Speaker 1: and then the other the other spectrum, the other end 577 00:32:15,600 --> 00:32:18,720 Speaker 1: of the spectrum is a highly highly fragmented ecosystem of 578 00:32:18,720 --> 00:32:21,960 Speaker 1: many small players. And we've done this twice already on 579 00:32:22,000 --> 00:32:26,200 Speaker 1: the Internet. I think in general, a smaller set of 580 00:32:26,280 --> 00:32:29,440 Speaker 1: five or six large tech companies just means that there 581 00:32:29,440 --> 00:32:33,440 Speaker 1: will be you know, hundreds of smaller businesses that sort 582 00:32:33,440 --> 00:32:38,040 Speaker 1: of more cooperate nicely together and you know, have very 583 00:32:38,040 --> 00:32:41,440 Speaker 1: clean interfaces and very clean data sharing rules, and you know, 584 00:32:41,480 --> 00:32:43,880 Speaker 1: there's a little bit more transparency and how you're you know, 585 00:32:43,880 --> 00:32:46,840 Speaker 1: how individual consumers are being tracked, and there's you know, 586 00:32:46,880 --> 00:32:49,960 Speaker 1: there's there's better interoperability. That becomes very important when you 587 00:32:50,000 --> 00:32:53,320 Speaker 1: have a fragmented ecosystem. But in general, I think it's 588 00:32:53,320 --> 00:32:56,920 Speaker 1: better for innovation, it's better for consumer choice. It's just 589 00:32:56,960 --> 00:32:59,600 Speaker 1: not good for you know, market cap of a few 590 00:32:59,600 --> 00:33:02,760 Speaker 1: folks and then the holders of those businesses as well, 591 00:33:02,760 --> 00:33:04,800 Speaker 1: because then they have to go and you know, figure 592 00:33:04,840 --> 00:33:10,479 Speaker 1: out where to reallocate that capital. Jamal, you mentioned a 593 00:33:10,480 --> 00:33:15,320 Speaker 1: little bit ago the killing of George Floyd and the 594 00:33:15,400 --> 00:33:18,360 Speaker 1: tensions that we've seen since then. You yourself, I've seen 595 00:33:18,360 --> 00:33:21,000 Speaker 1: on Twitter have been very critical of the police state 596 00:33:21,040 --> 00:33:23,640 Speaker 1: and how we do law enforcement in this country. I'm 597 00:33:23,640 --> 00:33:25,680 Speaker 1: curious if you could talk a little bit more about 598 00:33:25,720 --> 00:33:30,520 Speaker 1: what tech of Silicon Valley can contribute to accelerating change, 599 00:33:30,520 --> 00:33:32,920 Speaker 1: because I think you hear a lot from tech leaders 600 00:33:32,960 --> 00:33:36,560 Speaker 1: about the importance of diversity, and more companies have published 601 00:33:36,720 --> 00:33:40,440 Speaker 1: diversity numbers and things like that. But from your perspective, 602 00:33:40,480 --> 00:33:43,360 Speaker 1: in terms of putting things into practice that would make 603 00:33:43,360 --> 00:33:47,080 Speaker 1: a difference both internally and for society, where do you 604 00:33:47,120 --> 00:33:50,320 Speaker 1: see tech falling short still and what more of substance 605 00:33:50,360 --> 00:33:53,840 Speaker 1: could be done. Look, um, this is a very delicate topic, 606 00:33:54,400 --> 00:33:57,240 Speaker 1: and UM, I don't exactly know how to address it, 607 00:33:57,280 --> 00:33:59,520 Speaker 1: to be quite honest. It's something that I've been thinking about. 608 00:34:00,600 --> 00:34:02,320 Speaker 1: You know, it's really caused me a lot of anxiety 609 00:34:02,360 --> 00:34:04,360 Speaker 1: actually the last couple of weeks, because when you see 610 00:34:04,360 --> 00:34:07,360 Speaker 1: that stuff, both the Amy Cooper video and then the 611 00:34:07,400 --> 00:34:10,799 Speaker 1: George Floyd incident back to back. You know, for all 612 00:34:10,840 --> 00:34:14,439 Speaker 1: of us that are minorities, it triggers, you know, all 613 00:34:14,520 --> 00:34:19,040 Speaker 1: the many slights and inconsistencies and behavior that we've observed 614 00:34:19,160 --> 00:34:21,399 Speaker 1: and you know, have been done to you and have accumulated, 615 00:34:22,040 --> 00:34:24,520 Speaker 1: and you you normalize them because that's what it takes 616 00:34:24,560 --> 00:34:26,920 Speaker 1: to live a normal life and be a participant in 617 00:34:27,000 --> 00:34:31,080 Speaker 1: society without sort of seeing you know, embittered. But I 618 00:34:31,080 --> 00:34:34,880 Speaker 1: think the real the real change isn't necessarily for a company, 619 00:34:34,920 --> 00:34:38,319 Speaker 1: but it's for the majority, you know, ruling class, and 620 00:34:38,360 --> 00:34:41,600 Speaker 1: those are to be honest white folks. You know. The 621 00:34:41,600 --> 00:34:44,160 Speaker 1: analogy I made to a friend is if your child 622 00:34:44,320 --> 00:34:48,560 Speaker 1: came to you and said, you know, I'm being bullied, 623 00:34:49,920 --> 00:34:53,440 Speaker 1: is that the child's responsibility or the parents responsibility to 624 00:34:53,520 --> 00:34:56,719 Speaker 1: do something. If you had a very close friend and 625 00:34:56,760 --> 00:35:00,000 Speaker 1: she said to you, you know, I've been sexually assault 626 00:35:00,080 --> 00:35:03,759 Speaker 1: to is it her responsibility to fix it or is 627 00:35:03,800 --> 00:35:08,480 Speaker 1: it our society's responsibility to actually, you know, educate people 628 00:35:09,280 --> 00:35:12,640 Speaker 1: and train folks to be more respectful. And I think 629 00:35:12,680 --> 00:35:14,640 Speaker 1: this is sort of what it comes down to to 630 00:35:14,760 --> 00:35:17,520 Speaker 1: kind of like point to an industry and say, folks 631 00:35:17,560 --> 00:35:19,640 Speaker 1: need to do better. I think MS is the mark. 632 00:35:20,280 --> 00:35:22,640 Speaker 1: This is a societal issue that's that's kind of been 633 00:35:22,719 --> 00:35:26,600 Speaker 1: left unaddressed for a long time. And um, I think 634 00:35:26,640 --> 00:35:30,319 Speaker 1: people feel very sensitive about it on both sides. If 635 00:35:30,360 --> 00:35:33,160 Speaker 1: you're a person of color, you know, you feel at 636 00:35:33,200 --> 00:35:37,839 Speaker 1: points shame, anger, resentment. If you're not a person of color, 637 00:35:37,960 --> 00:35:44,279 Speaker 1: sometimes you feel grief, shame, resentment, fear, discomfort. And I 638 00:35:44,320 --> 00:35:46,200 Speaker 1: don't really have a very good answer. I wish I 639 00:35:46,239 --> 00:35:48,600 Speaker 1: could give you an articulate sense of what needs to happen. 640 00:35:48,640 --> 00:35:52,960 Speaker 1: Except that it is up to the folks who recognize 641 00:35:53,080 --> 00:35:56,160 Speaker 1: that it's wrong, but who are not the ones on 642 00:35:56,320 --> 00:36:00,960 Speaker 1: whom these injustices are put on to do something about it. 643 00:36:01,480 --> 00:36:04,040 Speaker 1: I can tell you one story, which is at after 644 00:36:04,120 --> 00:36:08,520 Speaker 1: nine eleven. You know, I hated getting on a airplane 645 00:36:08,760 --> 00:36:11,439 Speaker 1: and I still do because people look at you like 646 00:36:11,600 --> 00:36:14,080 Speaker 1: you're going to blow the plane up. I mean literally, 647 00:36:14,160 --> 00:36:16,359 Speaker 1: and you know, knowing me and knowing who I am, 648 00:36:16,840 --> 00:36:19,480 Speaker 1: you can imagine it's the furthest thing from the truth 649 00:36:19,520 --> 00:36:22,560 Speaker 1: and on my mind, and it's it's just it's just 650 00:36:22,600 --> 00:36:25,080 Speaker 1: a very very simple example because it doesn't really even 651 00:36:25,120 --> 00:36:27,799 Speaker 1: come close to the magnitude of what black people deal 652 00:36:27,840 --> 00:36:29,920 Speaker 1: with in America. But it's just an example. And I 653 00:36:30,040 --> 00:36:32,880 Speaker 1: used to have S S S written on my boarding 654 00:36:32,920 --> 00:36:36,200 Speaker 1: pass and it was there for years. I could have 655 00:36:36,239 --> 00:36:41,759 Speaker 1: been flying business class, first class economy, domestically, internationally, one 656 00:36:41,800 --> 00:36:45,400 Speaker 1: way return, it didn't matter. And uh, I would always 657 00:36:45,400 --> 00:36:47,920 Speaker 1: get these guys that were kind of like very kind 658 00:36:47,920 --> 00:36:50,840 Speaker 1: of like physically patting me down, and you know, it 659 00:36:50,840 --> 00:36:54,200 Speaker 1: just would delay me for hours, it seemed, and you 660 00:36:54,320 --> 00:36:57,759 Speaker 1: just feel so helpless and targeted. And what happened was 661 00:36:57,840 --> 00:36:59,799 Speaker 1: I told a coworker at the time of mine who 662 00:36:59,800 --> 00:37:04,359 Speaker 1: work today. Oh well, white guy, And what's so sad 663 00:37:04,400 --> 00:37:07,560 Speaker 1: about this incident was I was not ashamed. I was 664 00:37:07,600 --> 00:37:10,080 Speaker 1: just I didn't know what to do. He was so 665 00:37:10,160 --> 00:37:13,040 Speaker 1: angry he wrote the same letter that I wrote to 666 00:37:13,239 --> 00:37:16,360 Speaker 1: United and then all of a sudden, the SSS was 667 00:37:16,440 --> 00:37:20,560 Speaker 1: gone from my boarding past. It's a very simple example, 668 00:37:20,920 --> 00:37:23,239 Speaker 1: and it's not to take away from the severity of 669 00:37:23,239 --> 00:37:26,360 Speaker 1: of what the real issues are. But my point is 670 00:37:26,360 --> 00:37:29,880 Speaker 1: in that example, like you know, people of color sometimes 671 00:37:29,960 --> 00:37:32,120 Speaker 1: feel helpless, and it's the non people of color that 672 00:37:32,160 --> 00:37:34,919 Speaker 1: have to do something because you're just more credible at times, 673 00:37:34,960 --> 00:37:36,880 Speaker 1: and you're taking more seriously in a way where it 674 00:37:36,920 --> 00:37:39,480 Speaker 1: doesn't seem like we're complaining. And I don't feel like 675 00:37:39,480 --> 00:37:42,120 Speaker 1: I've ever complained in my life. But it makes you 676 00:37:42,160 --> 00:37:45,439 Speaker 1: feel pretty worthless, you know. You know, you get pulled 677 00:37:45,480 --> 00:37:47,360 Speaker 1: over by the cops ten times. I remember, like, I 678 00:37:47,400 --> 00:37:51,160 Speaker 1: have a driver now, and I told somebody. They asked me, like, 679 00:37:51,400 --> 00:37:54,960 Speaker 1: why do you have an Asian guy as your driver? 680 00:37:55,080 --> 00:37:58,279 Speaker 1: And I said, well, if it was another person of 681 00:37:58,320 --> 00:38:01,200 Speaker 1: color driving me, we would get pulled over in my car. 682 00:38:01,680 --> 00:38:03,680 Speaker 1: If it was a white person driving me, people would 683 00:38:03,719 --> 00:38:05,759 Speaker 1: think that, you know, maybe I had sort of car 684 00:38:05,840 --> 00:38:09,120 Speaker 1: jacked this car, and I've found through iteration of not 685 00:38:09,160 --> 00:38:11,480 Speaker 1: getting pulled over that this is the sequence that allows 686 00:38:11,520 --> 00:38:12,920 Speaker 1: me to do it. And I I did that. The 687 00:38:12,960 --> 00:38:14,640 Speaker 1: reason I did that was because I was so ashamed 688 00:38:14,640 --> 00:38:17,680 Speaker 1: of getting pulled over. So off. These are all these 689 00:38:17,719 --> 00:38:20,040 Speaker 1: little things, These are the things that accumulate rust in 690 00:38:20,080 --> 00:38:24,520 Speaker 1: a person's mind, and it's hard to overcome that stuff. 691 00:38:24,560 --> 00:38:26,160 Speaker 1: And it's hard to explain it to guys like you, 692 00:38:26,200 --> 00:38:29,320 Speaker 1: because I'm sure you never understand what that means. You know, 693 00:38:29,360 --> 00:38:31,400 Speaker 1: when you talk to when I talk to my black friends, 694 00:38:31,440 --> 00:38:34,160 Speaker 1: it's it's not a if, it's a when was the 695 00:38:34,200 --> 00:38:36,200 Speaker 1: first time that a policemen pulled a gun on you? 696 00:38:36,480 --> 00:38:40,560 Speaker 1: Can you imagine? I can't imagine that. So, you know, 697 00:38:40,600 --> 00:38:42,520 Speaker 1: what I just told you was a one on the scale. 698 00:38:42,560 --> 00:38:44,840 Speaker 1: What they're dealing with is a thousand on the scale. 699 00:38:45,600 --> 00:38:47,600 Speaker 1: And so I think it's up to you guys to 700 00:38:47,640 --> 00:38:49,960 Speaker 1: solve that problem. It's not a tech industry problem. This 701 00:38:50,040 --> 00:38:58,680 Speaker 1: is not an industry defining thing. This is a racial problem. 702 00:38:58,719 --> 00:39:01,960 Speaker 1: I think, Uh, it is a great spot to leave 703 00:39:02,040 --> 00:39:05,640 Speaker 1: it there, and I really appreciate you joining us. Appreciate 704 00:39:05,680 --> 00:39:09,480 Speaker 1: your perspective, appreciate your outspokenness. I enjoy following you on 705 00:39:09,520 --> 00:39:11,880 Speaker 1: Twitter and Chama. Thank you very much for joining us. 706 00:39:12,040 --> 00:39:25,520 Speaker 1: Thank you very much. Thanks take care of yourselves. So 707 00:39:25,840 --> 00:39:29,200 Speaker 1: I really like that conversation. I mean often, you know, 708 00:39:29,920 --> 00:39:33,480 Speaker 1: what would first catalyze the discussion or wanting to have 709 00:39:33,640 --> 00:39:36,319 Speaker 1: him on was the whole question about bailout. And I'm 710 00:39:36,360 --> 00:39:39,799 Speaker 1: often pretty cyndical about the sort of some of the 711 00:39:39,920 --> 00:39:43,880 Speaker 1: old let's let it go no bailoud nobi allouds for 712 00:39:43,920 --> 00:39:46,640 Speaker 1: the rich discussion, because I often get the impression that 713 00:39:46,719 --> 00:39:49,520 Speaker 1: it's sort of this desire among people with money to 714 00:39:49,920 --> 00:39:53,000 Speaker 1: um buy assets on the cheap or implicitly. But I 715 00:39:53,080 --> 00:39:57,239 Speaker 1: really don't think that that is that's his angle anyway. No, 716 00:39:57,640 --> 00:40:00,600 Speaker 1: you definitely don't get that sense. It is interesting to 717 00:40:00,600 --> 00:40:04,160 Speaker 1: see a venture capitalist piece so thoughtful on a number 718 00:40:04,160 --> 00:40:07,480 Speaker 1: of these topics. So he's talking about inequality and society 719 00:40:07,640 --> 00:40:11,280 Speaker 1: as well as between companies like the Big Bang stocks 720 00:40:11,320 --> 00:40:15,360 Speaker 1: and others, and also trying to decide, trying to think about, 721 00:40:15,360 --> 00:40:19,480 Speaker 1: trying to parse ways to fix a lot of societal 722 00:40:19,719 --> 00:40:22,600 Speaker 1: and economic issues. You don't see that very often. I 723 00:40:22,640 --> 00:40:24,560 Speaker 1: feel like you see a lot of like you see 724 00:40:24,600 --> 00:40:27,280 Speaker 1: a lot of venture capitalists who like to talk about 725 00:40:27,400 --> 00:40:31,279 Speaker 1: making the world a better place, but not necessarily in 726 00:40:31,320 --> 00:40:36,359 Speaker 1: these terms and with as much sincerity. No, exactly right, 727 00:40:36,440 --> 00:40:40,759 Speaker 1: And often there is this view that it's sort of like, 728 00:40:41,640 --> 00:40:44,200 Speaker 1: I don't know, it's a sort of quasi libertarians, sort 729 00:40:44,200 --> 00:40:46,799 Speaker 1: of like leave us alone and let us build, right, 730 00:40:46,960 --> 00:40:49,640 Speaker 1: let us build this thing. And I think it's interesting 731 00:40:49,760 --> 00:40:54,360 Speaker 1: that he's specifically talking about the need for, or the 732 00:40:54,480 --> 00:41:00,239 Speaker 1: likelihood of more aggressive taxation. There is reincredible constant right 733 00:41:00,360 --> 00:41:03,759 Speaker 1: rating tech in from a sort of like very substantive way, 734 00:41:04,000 --> 00:41:07,040 Speaker 1: taking the money, and it's gonna in his view, I mean, 735 00:41:07,600 --> 00:41:09,760 Speaker 1: people have been predicting it for a while. Maybe it won't, 736 00:41:09,760 --> 00:41:13,040 Speaker 1: maybe it will happen. But the tension that he sets up, 737 00:41:13,239 --> 00:41:17,719 Speaker 1: especially state and local government that are already sort of 738 00:41:17,719 --> 00:41:19,680 Speaker 1: stretched on cash and are gonna it's gonna be much 739 00:41:19,719 --> 00:41:23,480 Speaker 1: worse due to this crisis. This idea that this um 740 00:41:23,520 --> 00:41:27,520 Speaker 1: this tension is coming, or this class this inevitable clashes coming, 741 00:41:28,239 --> 00:41:31,080 Speaker 1: I found to be pretty compelling. Yeah, and I can 742 00:41:31,200 --> 00:41:34,359 Speaker 1: kind of see it going either way, because, of course, 743 00:41:34,400 --> 00:41:37,839 Speaker 1: in a crisis, like we were discussing, sometimes people want 744 00:41:37,840 --> 00:41:41,680 Speaker 1: to preserve whatever the industries are that are actually making money, 745 00:41:41,719 --> 00:41:44,680 Speaker 1: and tech, as we've seen, has still been doing reasonably 746 00:41:44,719 --> 00:41:49,399 Speaker 1: well because it's insulated from the coronavirus quarantine measures and 747 00:41:49,520 --> 00:41:52,040 Speaker 1: the stocks have been doing really great. But on the 748 00:41:52,080 --> 00:41:57,360 Speaker 1: other hand, because of the social discord that's been sparked 749 00:41:57,719 --> 00:42:00,080 Speaker 1: by everything that we've seen in the past month the 750 00:42:00,239 --> 00:42:02,239 Speaker 1: or so, you could also see a lot of the 751 00:42:02,280 --> 00:42:07,399 Speaker 1: public anger eventually aligning on big tech. So again, it's 752 00:42:07,400 --> 00:42:11,120 Speaker 1: gonna be really interesting to see which way it goes. Yeah, 753 00:42:11,120 --> 00:42:12,960 Speaker 1: and I feel like that's like, you know, we've been 754 00:42:12,960 --> 00:42:16,720 Speaker 1: doing a number of episodes that are kind of about 755 00:42:16,840 --> 00:42:20,160 Speaker 1: this question of like do we return to normal or 756 00:42:20,239 --> 00:42:25,480 Speaker 1: do the events of are they so profound that they 757 00:42:25,520 --> 00:42:29,680 Speaker 1: meaningfully reshape policy? And we've talked about it with trade policy, 758 00:42:30,080 --> 00:42:33,399 Speaker 1: we've talked about fiscal policy, but I think this sort 759 00:42:33,400 --> 00:42:36,719 Speaker 1: of question of whether we really as a society go 760 00:42:36,880 --> 00:42:40,920 Speaker 1: after huge power centers is another really big aspect of 761 00:42:40,920 --> 00:42:43,919 Speaker 1: that question. Yeah. Absolutely, you know, it will be fun 762 00:42:44,760 --> 00:42:48,360 Speaker 1: in ten years or so if we listen to a 763 00:42:48,360 --> 00:42:52,120 Speaker 1: bunch of old All Thoughts episodes from and just see 764 00:42:52,160 --> 00:42:56,279 Speaker 1: how a lot of these issues eventually got resolved. That'd 765 00:42:56,280 --> 00:42:58,920 Speaker 1: be fascinating. We have to get Laura, the producer, to 766 00:42:59,160 --> 00:43:01,920 Speaker 1: schedule those and out in so we could do the 767 00:43:02,400 --> 00:43:05,920 Speaker 1: ten years look back. Laura, please make us a time 768 00:43:05,960 --> 00:43:09,040 Speaker 1: capsule of All Thoughts episodes and bury it somewhere in 769 00:43:09,080 --> 00:43:10,920 Speaker 1: the Bloomberg office so that we can find it in 770 00:43:11,680 --> 00:43:14,840 Speaker 1: dig it up and listen to everything. Of course, not 771 00:43:15,000 --> 00:43:20,239 Speaker 1: a problem at all, Thank you. Ally. Should we leave 772 00:43:20,239 --> 00:43:24,520 Speaker 1: it there? Yeah, let's do that. This has been another 773 00:43:24,560 --> 00:43:27,640 Speaker 1: episode of the All Thoughts podcast. I'm Tracy Alloway. You 774 00:43:27,680 --> 00:43:30,640 Speaker 1: can follow me on Twitter at Tracy Alloway and I'm 775 00:43:30,719 --> 00:43:33,040 Speaker 1: Joe Why Isn't All? You could follow me on Twitter 776 00:43:33,160 --> 00:43:36,320 Speaker 1: at the Stalwart. You should follow our guest Chamath Polly 777 00:43:36,360 --> 00:43:40,720 Speaker 1: Hapatia on Twitter at Chama. Follow our producer on Twitter, 778 00:43:40,840 --> 00:43:44,399 Speaker 1: Laura Carlson at Laura M. Carlson. Follow the Bloomberg head 779 00:43:44,400 --> 00:43:48,600 Speaker 1: of podcast, Francesca Levi at Francesca Today, and check out 780 00:43:48,640 --> 00:43:52,319 Speaker 1: all of our podcasts at Bloomberg under the handle at podcasts. 781 00:43:52,440 --> 00:44:08,120 Speaker 1: Thanks for listening to