WEBVTT - Humiliation Ritual 0:00:02.680 --> 0:00:07.200 Bloomberg Audio Studios, podcasts, radio news. 0:00:08.440 --> 0:00:11.760 Did you know I interviewed Adam Back on Tuesday? 0:00:11.840 --> 0:00:12.360 On Tuesday? 0:00:12.480 --> 0:00:14.160 Yeah, do you know when the New York Times article 0:00:14.200 --> 0:00:15.480 came out Wednesday? 0:00:15.680 --> 0:00:18.520 Yeah, So that's fascinating. John Carrier at the New York 0:00:18.520 --> 0:00:21.400 Times identified Adam Back as Satosha knocking out over, the 0:00:21.440 --> 0:00:23.919 founder of bitcoin. And there's a lot of skepticism of 0:00:24.000 --> 0:00:26.600 this arification. A lot of the evidence for it is 0:00:26.640 --> 0:00:28.360 like sort of circumstantial stuff and a lot of like 0:00:28.440 --> 0:00:31.240 linguistic analysis, and like Adam Back is like a. 0:00:31.160 --> 0:00:34.240 Cryptographers also British, British. 0:00:34.040 --> 0:00:37.120 And there's all these things that like are basically shared 0:00:37.159 --> 0:00:39.239 by any of the you know, one hundred people who 0:00:39.320 --> 0:00:42.480 might have invented bitcoin. So there's a lot of skepticism 0:00:42.479 --> 0:00:45.280 of the identification. But what I really like in the story, Yeah, 0:00:45.320 --> 0:00:46.839 and this is why I wish you would interviewed him 0:00:46.840 --> 0:00:48.720 a day later. What I really liked in the story 0:00:49.000 --> 0:00:52.000 is that John Carrier doesn't hang his hat on these analyzes. 0:00:52.280 --> 0:00:53.760 I met with the guy and asked if he was 0:00:53.840 --> 0:00:57.560 Satoshi and he said no, but he looked shifty when 0:00:57.560 --> 0:01:00.840 he was doing it. Yeah, and I love I read 0:01:00.880 --> 0:01:02.640 out this all the time, like this notion that like 0:01:03.320 --> 0:01:06.000 investors get information from like the tone and body language 0:01:06.000 --> 0:01:09.600 of executives. I love the idea that everyone sort of 0:01:09.640 --> 0:01:13.560 goes around thinking that they can spot a liar, where 0:01:13.600 --> 0:01:15.520 like they can just look into someone's eyes and know 0:01:15.560 --> 0:01:18.600 if they're telling the truth. But the supposed to John Carrier, 0:01:18.640 --> 0:01:22.640 that's true, right, Like he's an accomplished investigative reporter. But 0:01:22.760 --> 0:01:24.640 I wish that you had looked at him back in 0:01:24.680 --> 0:01:27.280 the eyes and said so. 0:01:27.200 --> 0:01:28.920 And then my follow up question could have been like, 0:01:29.240 --> 0:01:30.240 why are you so nervous? 0:01:30.640 --> 0:01:34.080 You know you look turning red? Why is this adam 0:01:34.319 --> 0:01:38.319 so anyway? I love that as a category of evidence. 0:01:38.640 --> 0:01:40.840 I don't know that I'm convinced, but I like it. 0:01:41.040 --> 0:01:45.200 Yeah, I like it too. I will say I wish 0:01:45.319 --> 0:01:47.160 I wish that New York Times article had come out 0:01:47.200 --> 0:01:49.920 a day earlier. You were talking about quantum computing and 0:01:49.960 --> 0:01:52.120 I was filling in on our crypto show. I wasn't 0:01:52.120 --> 0:01:54.480 supposed to do it. It was just, you know, an 0:01:54.520 --> 0:01:58.440 anchor called out and I hopped in and it wasn't 0:01:58.440 --> 0:01:59.280 my best work. 0:02:01.160 --> 0:02:04.960 No, I tell you, if you had sat Nakamoto on 0:02:05.040 --> 0:02:06.680 your show and you didn't. 0:02:06.440 --> 0:02:11.600 Add yeah, I said, I was just talking to the 0:02:11.639 --> 0:02:17.160 CEO of Blockstream, you know, about quantum computing, also potentially 0:02:17.200 --> 0:02:20.000 the founder of bitcoin itself. I really think it is 0:02:20.240 --> 0:02:25.760 the most interesting modern mystery, you know. Yes, what else 0:02:25.800 --> 0:02:30.960 you got like truly modern, like still happening mystery. 0:02:31.080 --> 0:02:33.440 I don't know. My first instinct is that we are 0:02:33.520 --> 0:02:36.560 sort of training my children to be skeptical of the moonlanding. 0:02:36.320 --> 0:02:38.679 Just for fun, just for fun. 0:02:39.120 --> 0:02:39.399 You know. 0:02:39.720 --> 0:02:42.160 I've been telling my nephew that I'm a witch for 0:02:42.520 --> 0:02:44.080 consistently for the past couple of years. 0:02:44.120 --> 0:02:47.560 So yeah, I feel like that's a good aunt joke. 0:02:49.639 --> 0:02:52.240 He doesn't know if I'm joking at scared apparently I 0:02:52.280 --> 0:02:54.440 love the story. He was riding in the back of 0:02:54.560 --> 0:02:58.280 my brother and my sister in law's car and they 0:02:58.320 --> 0:03:02.560 hadn't been talking about me, but he very seriously asked, 0:03:02.880 --> 0:03:06.839 does Aunt Katie write a broom like it's on his mind? Yeah, 0:03:06.880 --> 0:03:08.720 he's just thinking, Yeah. 0:03:08.600 --> 0:03:11.360 It'spare moments. Yeah, that's what it means that you're a witch. 0:03:12.600 --> 0:03:16.160 Hello and welcome to The Money Stuff Podcast. You're a 0:03:16.160 --> 0:03:19.280 weekly podcast where we talk about stuff related to money. 0:03:20.200 --> 0:03:22.360 I'm Matt Levine and I write The Money Stuff column 0:03:22.400 --> 0:03:23.360 for Bloomberg Opinion. 0:03:24.240 --> 0:03:26.760 And I'm Katie Greifeld, a reporter for Bloomberg News and 0:03:26.800 --> 0:03:28.400 an anchor for Bloomberg Television. 0:03:28.720 --> 0:03:30.959 I feelin like we have some money stuff the podcast 0:03:31.040 --> 0:03:39.760 Greatest That's Today. Bill Ackman keeps doing stuff. 0:03:39.480 --> 0:03:41.880 Got so much stuff. He has a lot going on, 0:03:42.040 --> 0:03:42.800 a lot going on. 0:03:43.080 --> 0:03:45.440 It's impressive. But yeah, the news this week is that 0:03:45.480 --> 0:03:50.160 he's doing something with the Universal Music Group, or proposing 0:03:50.200 --> 0:03:51.839 to do something with Universal Music Group. 0:03:51.880 --> 0:03:54.000 He wants to buy it, No he doesn't, but he 0:03:54.040 --> 0:03:56.840 wants to do all this stuff that isn't necessarily just 0:03:56.880 --> 0:03:57.320 buying it. 0:03:57.720 --> 0:04:00.280 Yeah, I love it because like you love it. The 0:04:00.320 --> 0:04:03.680 headline is that he is proposed to acquire all of 0:04:03.800 --> 0:04:07.839 Universal Music Group for fifty five billion euros. But that's 0:04:07.880 --> 0:04:11.760 not true. Like what's happening is so universal? Is it? 0:04:11.760 --> 0:04:16.479 It's like listen in your ainext ins and Acman and 0:04:16.520 --> 0:04:18.039 a lot of people would like it to be listed 0:04:18.200 --> 0:04:20.440 in New York and it's proposed to listen to New 0:04:20.520 --> 0:04:23.240 York and like delay it and so partly as a 0:04:23.240 --> 0:04:27.440 matter of speeding that along, Akman has proposed basically a 0:04:27.480 --> 0:04:30.480 series of activist things. He wants the company to like 0:04:30.960 --> 0:04:33.480 borrow some money to buy back stock, you know, classic 0:04:33.560 --> 0:04:36.960 activist move. He stock buyback funted by borrowing. They own 0:04:36.960 --> 0:04:38.680 a stake in Spotify. He wants them to sell that 0:04:38.760 --> 0:04:40.680 off and use the cash to buy back more stock. 0:04:41.000 --> 0:04:43.240 He wants to buy some stock, and like they use 0:04:43.279 --> 0:04:46.800 those proceeds to buy back other people's stock and all 0:04:46.800 --> 0:04:49.120 of that activist stuff, he says, and his letter to 0:04:49.160 --> 0:04:51.400 the board will cause the stock to go up from 0:04:51.520 --> 0:04:54.240 you know, something like seventeen years now up thirty years. Right, 0:04:54.520 --> 0:04:56.800 So we created a lot of value for shareholders, and 0:04:56.839 --> 0:05:00.560 that's good theoretically. Yeah, yeah, strictly, this is great, right, 0:05:00.960 --> 0:05:03.400 It's like the law of nature. It's just like that's 0:05:03.480 --> 0:05:06.040 that's his analysis of what would happen if they changed 0:05:06.040 --> 0:05:08.719 their capital return strategy and you know, listed in New 0:05:08.800 --> 0:05:11.240 York and did some other stuff for sure, and the 0:05:11.279 --> 0:05:13.440 way that he would buy stock and the way that 0:05:13.680 --> 0:05:16.680 they would do this borrowing to buy more stock is 0:05:16.720 --> 0:05:19.520 a transaction that's technically a merger. It's a merger with 0:05:20.160 --> 0:05:25.000 like one of his vehicles. Kid, he's like falling directly 0:05:25.040 --> 0:05:25.680 asleep here. 0:05:25.800 --> 0:05:27.919 The problem is, I've read this so many times and 0:05:27.960 --> 0:05:29.920 my eyes glaze over every single time. 0:05:29.960 --> 0:05:32.760 But so I believe it has this thing called a spark. Yes, 0:05:32.920 --> 0:05:34.680 like a speck, only doesn't have money. It's going to 0:05:34.760 --> 0:05:36.520 raise money later, Yeah, don't worry about So he's going 0:05:36.560 --> 0:05:37.920 to go ahead and raise a billion dollars in the 0:05:38.000 --> 0:05:40.520 spark or he won't because like it's backstop by his 0:05:40.640 --> 0:05:43.080 hedge fund that has the money, and he's going to 0:05:43.200 --> 0:05:46.840 use the spark to merge with Universal. And like the 0:05:46.880 --> 0:05:49.960 combined company will list on the New York'stock Exchange, So 0:05:50.000 --> 0:05:52.480 like most of the stock in the combined company will 0:05:52.480 --> 0:05:55.960 be owned by existing Universal shareholders, you know, Pershing squirrel on, 0:05:56.080 --> 0:05:59.839 you know, ten eleven percent of it. That's the transaction. 0:06:00.120 --> 0:06:03.720 But because it involves a merger, he can say things 0:06:03.760 --> 0:06:07.160 like I'm proposing to buy all of Universal, and because 0:06:07.960 --> 0:06:10.919 it involves a merger, he can say I'm proposing to 0:06:10.920 --> 0:06:13.040 buy it for a value of thirty yuros per share, 0:06:13.040 --> 0:06:15.320 even though that's not he's not buying it for thirty 0:06:15.400 --> 0:06:17.480 years per share. Yeah, buying a little bit of that 0:06:17.600 --> 0:06:20.440 twenty two years a share. But because the activist thing, 0:06:20.560 --> 0:06:22.400 like the math on, it pencils out to being worth 0:06:22.440 --> 0:06:25.839 thirty years a share, says him, he can say I'm 0:06:25.839 --> 0:06:27.240 going to buy the whole company at a seventy eight 0:06:27.279 --> 0:06:30.000 percent premium and get people to write that Andy, Yeah, Yeah, 0:06:30.000 --> 0:06:32.560 it's proprilling to buy the company. It's seventy eight percent premium. 0:06:32.640 --> 0:06:36.279 Yeah, And a lot of places did write yeah, or a. 0:06:36.320 --> 0:06:38.280 Version of it, that's the headline. It's a good way 0:06:38.320 --> 0:06:40.320 to get attention for your activism because you send a 0:06:40.400 --> 0:06:41.920 letter being like, I want to buy a little bit 0:06:41.920 --> 0:06:44.159 of stock and I want you to make some changes 0:06:44.160 --> 0:06:46.320 in your capital return strategy. So yeah, everyone says that 0:06:46.360 --> 0:06:48.280 all the time, right, yeah, and then you go, oh, 0:06:48.279 --> 0:06:50.320 it'll be worth a lot of more money and sure whatever. 0:06:50.440 --> 0:06:52.480 But if you say I'm gonna buy it, and then 0:06:52.800 --> 0:06:53.440 it sounds real. 0:06:53.800 --> 0:06:57.040 So I mean the stock surged on this, eighty rs popped. 0:06:57.400 --> 0:07:00.640 There are some very high hurdles to this happening, sure, 0:07:00.800 --> 0:07:02.920 I mean he has to convince two thirds of investors 0:07:02.960 --> 0:07:04.920 to agree. And also there's a certain. 0:07:04.680 --> 0:07:08.159 Thought suggests people like it. You can wave away everything 0:07:08.160 --> 0:07:09.680 else and be like, well, listing in New York it 0:07:09.720 --> 0:07:09.960 is going. 0:07:09.960 --> 0:07:12.840 To be good for the that's the interesting part. I 0:07:12.880 --> 0:07:14.400 mean that makes sense to me. We've seen a lot 0:07:14.400 --> 0:07:18.880 of European companies come to New York or IPO on 0:07:19.040 --> 0:07:23.880 US exchanges. But I didn't realize that Universal Music Group 0:07:24.200 --> 0:07:26.960 UMG had planned to do this but then scrapped it 0:07:27.120 --> 0:07:30.960 just last month. Their plans a list setting market uncertainty, 0:07:31.480 --> 0:07:32.720 which is fair. But I mean. 0:07:34.400 --> 0:07:36.280 Maybe it's yeah, maybe it's nothing. 0:07:36.360 --> 0:07:40.320 But I don't really understand is what he wants to 0:07:40.360 --> 0:07:42.520 sell the stake in Spotify, Like why that would be 0:07:42.560 --> 0:07:47.160 good long term because Spotify has crushed it over the 0:07:47.240 --> 0:07:50.800 last five years or so compared to UMG. Yeah, like 0:07:50.840 --> 0:07:51.960 that seems pretty valuable. 0:07:52.280 --> 0:07:54.360 Sure, but if it seems pretty valuable, you can sell 0:07:54.360 --> 0:07:55.480 it for money now, I know. 0:07:55.760 --> 0:07:57.880 But it might be something you want to hang on to. 0:07:58.240 --> 0:08:00.559 Yeah, but if the market value is that as highly 0:08:00.680 --> 0:08:02.640 or more or more highly than you do, then you 0:08:02.680 --> 0:08:05.120 should sell it now. Also, it's just it's like very 0:08:05.160 --> 0:08:08.720 standard activist playbook to be like, the market never values 0:08:08.720 --> 0:08:12.920 some weird random minority stake at its full value because 0:08:12.960 --> 0:08:15.800 the market is focused on, you know, investing in the 0:08:15.840 --> 0:08:18.200 company's business. If you make the business a simpler story, 0:08:18.240 --> 0:08:20.280 then the market will, you know, describe more value to 0:08:20.320 --> 0:08:22.440 that story. If you can sell a minority stake in 0:08:22.440 --> 0:08:26.040 Spotify for more dollars than like the market describes to 0:08:26.120 --> 0:08:28.640 its value when it's part of a bigger company. So 0:08:28.800 --> 0:08:30.760 I don't know, that's like pretty standard logic. It might 0:08:30.800 --> 0:08:33.640 not be true, but like, if you're sure that Spotify 0:08:33.720 --> 0:08:35.319 is going to continue going up much more than the 0:08:35.360 --> 0:08:36.760 rest of the company, then sure, hang out to it. 0:08:37.520 --> 0:08:40.480 Yeah, anyway, I did want to bring up the French 0:08:40.520 --> 0:08:43.360 billionaire that he has to convince. Sure, I'm so bad 0:08:43.400 --> 0:08:46.920 at French names, so I'm scared to say it. Vincent 0:08:46.920 --> 0:08:48.280 Pulair Does that sound good? 0:08:48.400 --> 0:08:48.920 Sounds good? 0:08:49.559 --> 0:08:52.640 French person's going to write in anyway, he owns more 0:08:52.640 --> 0:08:56.240 than an eighteen percent stake through his family holding company. 0:08:56.400 --> 0:09:00.320 But apparently Ackman said that he spoke to bull Air 0:09:00.440 --> 0:09:02.520 and his investment group and said that they were quote 0:09:02.600 --> 0:09:03.840 intrigued with the. 0:09:03.880 --> 0:09:06.439 Right part of the point of the proposals. So maybe 0:09:06.600 --> 0:09:09.480 intrigued crush him out, you know, if he wants cash 0:09:09.480 --> 0:09:12.319 instead of his stake. But I'm not privy to those negotiations. 0:09:12.520 --> 0:09:16.400 No, that was billionaire to a billionaire, not for us 0:09:16.440 --> 0:09:17.320 to know the ft. 0:09:18.040 --> 0:09:23.360 Today Thursday, I think reported another he's so busy he's 0:09:23.400 --> 0:09:24.000 got going on. 0:09:24.120 --> 0:09:25.839 I know I was wondering if we were going to 0:09:25.880 --> 0:09:26.200 get there. 0:09:26.320 --> 0:09:28.559 Yeah, briefly because I don't really understand it. He's got 0:09:28.559 --> 0:09:30.880 a big let's say hedge fund, it's not really the 0:09:30.960 --> 0:09:32.240 right word for it, but he is a big pot 0:09:32.280 --> 0:09:34.640 of money that he invests in some stocks basically and 0:09:34.640 --> 0:09:37.680 he does the occasional like asymmetric derivatives trade as he 0:09:37.679 --> 0:09:40.560 would say. That makes a lot of money on for instance, COVID, 0:09:40.840 --> 0:09:43.439 and it's in this like series of funds that are 0:09:43.640 --> 0:09:46.520 most prominently is like close end fund in Europe, and 0:09:46.559 --> 0:09:49.040 he's like launching a closed end fund in the US, 0:09:49.559 --> 0:09:52.199 pushing to where USI We've talked about this a lot. 0:09:52.480 --> 0:09:54.400 It keeps being in the process of launching. 0:09:54.600 --> 0:09:56.680 Yes, as a launched, it's going to happen. 0:09:56.760 --> 0:09:58.640 It's gonna happen. But so he's raising like five to 0:09:58.679 --> 0:10:00.680 ten billion dollars for that. He's like Peoing the management 0:10:00.720 --> 0:10:03.320 company is part of that, blah blah blah. But the 0:10:03.440 --> 0:10:05.240 f he reported that he's also in talks three is 0:10:05.280 --> 0:10:09.400 a separate fund. Now only do the like asymmetric toatives. 0:10:09.880 --> 0:10:13.360 So instead of owning like you know, a concentrated portfolio 0:10:13.400 --> 0:10:17.760 of large cap stops and sometimes buying index CDs, oat 0:10:17.800 --> 0:10:21.800 of a pandemic, he would own treasury bills and occasionally 0:10:21.840 --> 0:10:27.440 buy index CDs instead of a pandemic, which okay, yeah sure, yeah, 0:10:27.760 --> 0:10:31.000 like a like sort of like a tele risk hedge fund. Yeah, 0:10:31.280 --> 0:10:32.520 a permanent capitol vehicle. 0:10:33.080 --> 0:10:36.080 Yeah. The ft called it like you know, he's making 0:10:36.120 --> 0:10:37.400 doomsday trades here. 0:10:37.600 --> 0:10:39.360 Yeah. The headline is something like he wants the profit 0:10:39.400 --> 0:10:43.120 from market complacency. Right, He's going to bet against complacency, Yeah, 0:10:43.200 --> 0:10:44.960 as opposed to the rest of the portfolios. Is like 0:10:45.000 --> 0:10:46.319 owning latche caap equities. 0:10:46.559 --> 0:10:50.760 This is something that apparently he has highlighted two investors 0:10:50.920 --> 0:10:53.400 as a way to turbo charge the firm's fee earnings. 0:10:53.440 --> 0:10:56.760 So it does play into the potential IPO here. 0:10:56.840 --> 0:11:00.200 Yeah. Right. The way the IPO works is that he's 0:11:00.320 --> 0:11:04.920 mostly selling shares of this closed infund's mostly selling shares 0:11:04.960 --> 0:11:07.800 of a pot of you know, investments, but he's partially 0:11:08.200 --> 0:11:12.000 selling shares in the management company. And so the more 0:11:12.040 --> 0:11:15.360 assets the management company runs, the more that is worth, 0:11:15.800 --> 0:11:18.800 and therefore the more appealing it is to investors in 0:11:18.840 --> 0:11:21.080 the I p O. Right, So, like, if you're paying 0:11:21.440 --> 0:11:23.560 people to buy your clothes end fund and the currency 0:11:23.600 --> 0:11:26.199 of your management company, then like the more funds you run, 0:11:26.280 --> 0:11:26.880 the better that. 0:11:26.880 --> 0:11:30.160 Is doesn't seem very more in buffet of him. I 0:11:30.240 --> 0:11:32.320 keep getting confused over who Bill Lackman is. 0:11:32.440 --> 0:11:33.840 You know, is he Warren Buffett? 0:11:33.880 --> 0:11:35.079 Or is he a bird? 0:11:35.880 --> 0:11:36.200 Yeah? 0:11:36.640 --> 0:11:38.920 I don't know, Bill Ackman, who are you? 0:11:39.440 --> 0:11:42.600 He's a bird? Don't answer that or do He's also 0:11:42.600 --> 0:11:44.240 like tweeting a lot, But that's a that's a whole 0:11:44.240 --> 0:11:46.439 other story of all. 0:11:46.559 --> 0:11:50.080 The thing he wrote today is that it is not 0:11:50.160 --> 0:11:52.720 quite fair to say that Billlackman runs a portfolio of 0:11:53.320 --> 0:11:56.680 a dozen ish large cap stocks that don't change very much. 0:11:56.840 --> 0:11:59.000 But it's a little bit true, and that's very cool 0:11:59.120 --> 0:12:00.760 if you can do that and make money and be 0:12:00.960 --> 0:12:02.839 edge trying to manage it. Right, You're just like, I'm 0:12:02.840 --> 0:12:04.559 gonna own twelve stocks with the right twelve stocks, and 0:12:04.559 --> 0:12:06.040 I'm not gonna change it that much. I'm just gonna 0:12:06.360 --> 0:12:07.520 kind of hang out here and tweet a lot. 0:12:07.760 --> 0:12:08.480 That's what I would do. 0:12:08.840 --> 0:12:10.360 That's what I would do it. Like that is my 0:12:10.520 --> 0:12:12.400 dream as a money manager, right, Like the people who 0:12:12.440 --> 0:12:14.800 are like, I'm going to like work all day and 0:12:14.880 --> 0:12:17.199 change my portfolio every day so they can capture like 0:12:17.240 --> 0:12:19.600 every incremental piece of alpha. That sounds like a hard job, 0:12:19.600 --> 0:12:21.959 whereas like I'll just pick the red stocks and then. 0:12:22.120 --> 0:12:23.880 Tweet I'll just pick good snack. 0:12:24.559 --> 0:12:26.960 Incredible move. But what I like about this idea of 0:12:27.000 --> 0:12:29.439 the like whatever complacency. 0:12:29.240 --> 0:12:30.440 Doom to day fun. 0:12:31.320 --> 0:12:32.959 So one way to run a doomsday fund and the 0:12:33.000 --> 0:12:35.640 way people run their dooms day funds is basically you 0:12:35.679 --> 0:12:37.920 wake up every day and you buy some pots on 0:12:37.920 --> 0:12:40.040 the S and P. Yeah, and it costs you money, 0:12:40.240 --> 0:12:42.160 and at the end of every year you send your 0:12:42.360 --> 0:12:44.640 investors a statement being like I've lost ten percent of 0:12:44.679 --> 0:12:46.640 your money, and then once every like ten years you're 0:12:46.640 --> 0:12:48.439 like I've made twenty thousand percent of your money and 0:12:48.440 --> 0:12:51.120 they're like, okay, fun. It's like a bad profile, right. 0:12:51.480 --> 0:12:53.520 But like the alternative way to run a doomsday fun 0:12:53.520 --> 0:12:54.880 which is like a little bit what is implied by 0:12:54.920 --> 0:12:57.800 the ft article though I don't have no idea, is 0:12:57.840 --> 0:13:00.319 you take the investors' money put in treasure. But I 0:13:00.360 --> 0:13:02.880 don't do anything. You're in four percent a year, and 0:13:03.040 --> 0:13:05.160 every once in a while you're like, you know what 0:13:05.960 --> 0:13:08.840 next week is doomsday. I'm gonna buy puts on the 0:13:08.920 --> 0:13:11.720 S and P today, And if you're right all the time, 0:13:12.200 --> 0:13:16.920 every time you buy doomsday insurance, it pays off, which 0:13:16.960 --> 0:13:19.000 is like what happened to Acmin in COVID, Like you 0:13:19.080 --> 0:13:23.839 bought like some index CDs twenty seven million dollars. I'm like, 0:13:23.880 --> 0:13:26.400 the next week it paid off like billions of dollars. Right, 0:13:26.520 --> 0:13:31.000 So if you're just perfect at predicting doomsday like next week, 0:13:32.040 --> 0:13:34.360 then like your return profile is like most years you 0:13:34.480 --> 0:13:37.160 just earned treasury bills. In some years you return like 0:13:37.160 --> 0:13:42.160 ten thousand percent. That's a great fund. And the reason 0:13:42.160 --> 0:13:44.880 that no one does that is one, no one's perfect predicting, 0:13:45.440 --> 0:13:47.000 right and too because like you know, you have a 0:13:47.080 --> 0:13:49.640 job and you're like, oh, I'm like charging fees and 0:13:49.679 --> 0:13:52.160 like taking investors' money to protect them from doomsday, And 0:13:52.200 --> 0:13:54.319 so you end up buying a lot of doomsday insurance 0:13:54.320 --> 0:13:56.000 because it's just like what it says on the tin. 0:13:56.960 --> 0:13:59.000 And if you're Bill Ackman and you have the zen 0:13:59.160 --> 0:14:01.720 like repose to just buy twelve stocks and hold them 0:14:01.720 --> 0:14:03.839 and tweet all the time, they're like, maybe you can 0:14:03.920 --> 0:14:05.640 do the doomsday fund the right way, where you just 0:14:05.640 --> 0:14:08.240 don't do anything until it's almost doomsday and then you 0:14:08.280 --> 0:14:10.400 buy insurance and make a lot of money. This is 0:14:10.400 --> 0:14:12.760 like I'm mostly joking suggestion, but I kind of like it. 0:14:12.800 --> 0:14:16.400 No, I fantasize all the time, Like what if I 0:14:16.440 --> 0:14:19.720 wasn't in journalism, what if I had a completely unrelated job, 0:14:20.120 --> 0:14:24.680 what if I was a novelist. Then I dream about 0:14:24.720 --> 0:14:27.360 what my portfolio would be and doing something like that 0:14:27.480 --> 0:14:29.680 sounds really fun, right, Like the best. 0:14:29.480 --> 0:14:32.840 Way to invest is to just buy a stock right 0:14:32.880 --> 0:14:35.520 before it goes up a lot, or buy crash insurance 0:14:35.560 --> 0:14:37.520 right before the market goes down a lot. Yeah, it's 0:14:37.520 --> 0:14:40.000 hard to pull off, both intellectually and as a matter 0:14:40.040 --> 0:14:42.520 of getting antsy. But like Bill, likeman might not get antsy, 0:14:43.120 --> 0:14:43.640 that's true. 0:14:58.240 --> 0:15:01.680 Also very busy man. He's got a lot going on. 0:15:01.840 --> 0:15:02.560 A lot going on. 0:15:02.880 --> 0:15:05.280 He has one, like really big thing going on right now, 0:15:07.000 --> 0:15:07.640 can you guess? 0:15:08.040 --> 0:15:09.720 No, I actually wonder like if you went to him 0:15:09.720 --> 0:15:11.280 and said, what's a big thing you've got going on 0:15:11.360 --> 0:15:14.480 right now? Would he be like fighting the woke mind virus? 0:15:14.600 --> 0:15:17.000 No. I think he'd say something like trying to make 0:15:17.080 --> 0:15:20.440 more people use rock. Really, it'd be one of the things. 0:15:20.560 --> 0:15:23.720 I think it would be something much weirder. God, it 0:15:23.760 --> 0:15:26.600 would be like solving the population crisis. 0:15:26.640 --> 0:15:29.200 That's my second big question. Of the podcast Elon Musk, 0:15:29.800 --> 0:15:31.760 what's your big thing anyway? 0:15:32.280 --> 0:15:34.480 I believe the big thing you were referring to, Yeah, 0:15:34.560 --> 0:15:37.200 is the space, the impending SpaceX slash X. 0:15:37.480 --> 0:15:40.960 I mean, it's factually very big. It's very big. It 0:15:41.040 --> 0:15:42.800 keeps getting bigger, probably. 0:15:42.960 --> 0:15:47.360 Soon, although yeah, they filed confidentially. Everyone says they're looking 0:15:47.400 --> 0:15:48.960 to go in June, although it's not clear that they 0:15:49.000 --> 0:15:51.280 will go in Jane. But yeah, very big, two trillion 0:15:51.320 --> 0:15:54.960 dollars supposedly, and yes, as part of his quest to 0:15:55.000 --> 0:15:58.400 get everyone to use Croc and thus fight the woke 0:15:58.480 --> 0:15:58.960 mind virus. 0:15:59.040 --> 0:15:59.640 Yeah, for sure. 0:16:00.040 --> 0:16:04.360 Your Times reported that is making bankers who want to 0:16:04.440 --> 0:16:09.840 lead the IPO by subscriptions to Kroc for their banks, 0:16:10.240 --> 0:16:13.480 which is like a little frowned upon. But I don't 0:16:13.520 --> 0:16:18.560 know why. It's like impolite. It feels somehow dodgy. Yeah, 0:16:18.680 --> 0:16:21.360 but I kind of respect it. You know, he's the 0:16:21.400 --> 0:16:22.920 CEO of or whatever he is. 0:16:23.080 --> 0:16:25.800 He's not actually I don't think he's sick or whatever. 0:16:25.800 --> 0:16:29.480 He's the owner. Yeah, and he's like making a sale. Yeah, 0:16:29.560 --> 0:16:31.720 you know, like shows up this meaning like, hey, guys, 0:16:31.760 --> 0:16:33.840 you know what's great is groc? You should by Groc. Yeah, 0:16:33.880 --> 0:16:35.680 they're like, okay, well look into him, be like no, no, no, 0:16:36.280 --> 0:16:37.240 by Grock right now. 0:16:37.560 --> 0:16:40.560 And this matters personally that Elon Musk. It also matters 0:16:40.600 --> 0:16:43.400 to SpaceX, and SpaceX now owns XII. 0:16:43.680 --> 0:16:45.440 Okay, so first of all, this company is going to 0:16:45.440 --> 0:16:47.720 go public at one hundred times earnings or a hundred 0:16:47.720 --> 0:16:50.040 times revenue or something. I don't actually know the revenue numbers, 0:16:50.040 --> 0:16:52.600 but like the two trillion dollar evaluation is not closely 0:16:52.600 --> 0:16:55.840 connected to any amount of revenue or income. But you know, 0:16:55.840 --> 0:16:58.680 every little bit helps, and in particular, you know, to 0:16:58.720 --> 0:17:01.280 the extent you are going public not only as a 0:17:01.360 --> 0:17:05.199 rocket company, but as ooh AI everything's AI, you know, 0:17:05.320 --> 0:17:08.520 showing like AI adoption is valuable, even if the AI 0:17:08.720 --> 0:17:11.359 is still a sort of smallest part of the business 0:17:11.359 --> 0:17:14.920 commerci Yeah, and so saying you know, all of these 0:17:15.040 --> 0:17:18.200 big banks there's names are on the cover of the perspective, 0:17:18.200 --> 0:17:21.639 So all these big banks have purchased subscriptions to GROC. 0:17:22.880 --> 0:17:25.760 Some of the banks seems positive. 0:17:27.000 --> 0:17:28.560 I mean not if you have articles being like, oh, 0:17:28.600 --> 0:17:29.960 they only did it because they were forced through, but 0:17:30.000 --> 0:17:31.080 you know, maybe they'll like it. 0:17:31.880 --> 0:17:34.359 Or I was also wondering like after they get the 0:17:34.400 --> 0:17:37.080 IPO over the line. Can they just cancel their subscriptions? 0:17:37.520 --> 0:17:39.960 So One, I'm sure they'll pay for some portion of 0:17:40.000 --> 0:17:41.800 it upfront. Two, maybe they'll like it. 0:17:42.600 --> 0:17:43.680 Maybe it's the best. 0:17:43.920 --> 0:17:47.520 No, because Elon Musk is like a continual source of 0:17:48.600 --> 0:17:52.560 ajata for banks, right, and then fees, you know, and 0:17:52.640 --> 0:17:56.359 so you're always looking to win continued business and you know, 0:17:57.160 --> 0:17:59.080 a million dollars a year for crock or whatever. 0:17:59.200 --> 0:18:00.560 It's fair. Feel maybe it's good. 0:18:00.640 --> 0:18:01.880 Be they like it, Maybe they like it. 0:18:01.920 --> 0:18:02.600 Maybe they will. 0:18:02.800 --> 0:18:05.359 You'd hope that Sam Altonman and Tima Day are reading 0:18:05.359 --> 0:18:06.720 this and being like, I we should do that too. 0:18:07.200 --> 0:18:09.160 So now every bank has to buy the subscriptions every 0:18:09.440 --> 0:18:09.920 that's true. 0:18:10.080 --> 0:18:13.480 Of course, open Ai and Anthropic also potentially going public 0:18:13.560 --> 0:18:13.920 this year. 0:18:14.080 --> 0:18:14.280 Right. 0:18:14.560 --> 0:18:16.439 I love some of the details in this piece from 0:18:16.480 --> 0:18:18.399 the New York Times. Some of the banks have agreed 0:18:18.400 --> 0:18:21.640 to spend tens of millions of dollars on the chatbot. 0:18:21.640 --> 0:18:24.560 But also this is fun. Elon Musk also reportedly asked 0:18:24.560 --> 0:18:27.679