WEBVTT - China Urges Local Firms to Avoid Nvidia H20 Chips 0:00:00.280 --> 0:00:14.200 Bloomberg Audio Studios, podcasts, radio news. Bloomberg Tech is alive 0:00:14.240 --> 0:00:18.040 from coast to coast with Caroline Hide in New York 0:00:18.320 --> 0:00:23.239 and ever though in San Francisco. 0:00:23.720 --> 0:00:25.520 This is Bloomberg Tech coming up. 0:00:25.640 --> 0:00:30.680 Beijing urges local companies to avoid using Nvidia's H twenty processors. 0:00:31.000 --> 0:00:34.480 Plas e Lo Musk accuses Apple of favoring Open Ai 0:00:34.560 --> 0:00:36.400 above other AI companies in. 0:00:36.400 --> 0:00:40.159 Its app store and stable coin issue a Circle's revenue 0:00:40.200 --> 0:00:43.640 jump fifty three percent just two months after a splashy 0:00:43.640 --> 0:00:44.559 public debut. 0:00:44.640 --> 0:00:45.920 We'll discuss with the CEO. 0:00:46.440 --> 0:00:49.360 First, we return to the public markets, not just Circle. 0:00:49.080 --> 0:00:51.360 But the broader indices. They're at record. 0:00:51.200 --> 0:00:53.680 Highs, the Nasdaq one hundred, the NASDAK, the S and 0:00:53.720 --> 0:00:54.400 P five hundred. 0:00:54.440 --> 0:00:54.920 We're up six. 0:00:55.520 --> 0:00:58.520 It's been volatile trade as we digest the CPI number. 0:00:58.760 --> 0:01:02.960 All importantly consumer price inflation coming in where the market anticipated. 0:01:03.120 --> 0:01:05.280 It looks as if the market thinks still the Fed 0:01:05.280 --> 0:01:07.199 has room to cut ed. But you are looking once 0:01:07.240 --> 0:01:09.039 again at the semiconductor story. 0:01:10.240 --> 0:01:13.720 Yeah, Nvidia and AMD are off session lows. What happened 0:01:13.720 --> 0:01:18.959 this morning was the Information reported that China's Internet regulator 0:01:19.520 --> 0:01:23.760 had demanded that specific companies including Ali, Barba and ten 0:01:23.880 --> 0:01:27.520 Cent cancel orders for H twenty. There's a lot to 0:01:27.640 --> 0:01:31.080 unpack there, because, in particular, it is different from. 0:01:30.920 --> 0:01:32.160 What Bloomberg reported. 0:01:32.200 --> 0:01:38.320 Bloomberg reported that Chinese authorities had urged various Chinese entities 0:01:38.600 --> 0:01:40.960 to hold off on ordering the technology. 0:01:40.959 --> 0:01:42.280 There's a difference of severity. 0:01:42.319 --> 0:01:44.640 They're hot on the heels of a big story twenty 0:01:44.640 --> 0:01:47.360 four hours ago where the President cut a deal with 0:01:47.480 --> 0:01:51.400 Nvidia ANDAMD to do a revenue split on a accelerator 0:01:51.440 --> 0:01:52.240 sales in China. 0:01:52.440 --> 0:01:53.720 Let's get out to DC Carriac. 0:01:53.840 --> 0:01:57.560 Yeah, let's get that White House perspective. Josh Wingrove is 0:01:57.600 --> 0:01:59.880 in the bowels of the White House as we speak, 0:02:00.160 --> 0:02:01.400 and we thank you for joining us. 0:02:01.440 --> 0:02:01.760 Josh. 0:02:02.080 --> 0:02:04.520 Just what do you think the Teta tet means here 0:02:04.760 --> 0:02:07.800 for the White House to see China's response in terms 0:02:07.840 --> 0:02:09.560 of pushing back against age twenties. 0:02:11.000 --> 0:02:13.240 Yeah, thank you for having me. This is the glamour 0:02:13.440 --> 0:02:15.640 of the press tows here at the White House. So 0:02:15.760 --> 0:02:18.400 just in case you think it's it's all sunshine and 0:02:18.440 --> 0:02:21.760 lollipop's down here, you know, we're we're in it. We're 0:02:21.760 --> 0:02:25.600 in it, We're surviving. This is sort of I guess, 0:02:25.600 --> 0:02:27.880 a tightening of the screws, and the sort of back 0:02:27.960 --> 0:02:30.320 and forth between them, right, this question of will the 0:02:30.440 --> 0:02:33.399 h twenties go at all? And then the report that 0:02:34.200 --> 0:02:36.720 prom saying he asked for a twenty percent cut and 0:02:36.760 --> 0:02:40.359 then Nvidian him settle at fifteen percent. And now that's 0:02:40.639 --> 0:02:43.480 China saying, well, maybe we don't want those ships in 0:02:43.639 --> 0:02:46.520 the first place. And you know, there's a few questions 0:02:46.520 --> 0:02:49.640 swirling here. One of those is will the administration try 0:02:49.680 --> 0:02:53.320 to do this on other products, whether chips or otherwise, 0:02:53.400 --> 0:02:57.359 try to you know, leverage export controls for new government revenues. 0:02:57.400 --> 0:03:01.080 It's unclear. They've been silent about it. Sure scene like 0:03:01.200 --> 0:03:04.200 this is the model that Trump would like, So you know, 0:03:04.440 --> 0:03:05.840 this sort of seems like it would be on the 0:03:05.880 --> 0:03:08.320 table for things that, you know, where the working market 0:03:08.320 --> 0:03:11.040 would bear it. Another one is, of course, whether companies 0:03:11.080 --> 0:03:15.280 do actually heed what we're reporting, is the warning from 0:03:15.360 --> 0:03:18.400 China or the request I guess from China to avoid 0:03:18.520 --> 0:03:20.360 using these ships. Is that the big question is what 0:03:20.360 --> 0:03:24.040 would ultimately the demand fall to if Chinese demand were 0:03:24.120 --> 0:03:26.560 to fall on this. And then there's a question of, well, 0:03:26.560 --> 0:03:29.600 what about the other chips? Right, Trump mused about even 0:03:29.720 --> 0:03:33.120 selling more advanced chips, but a peared down version of them. 0:03:33.160 --> 0:03:35.480 No one really knows what that would look like. Anyway, 0:03:35.920 --> 0:03:38.200 might be open to that, again, it would seem with 0:03:38.680 --> 0:03:40.600 some sort of cut. But a lot of analysts have said, well, 0:03:40.600 --> 0:03:43.120 if you're just charging you know, premiums to send even 0:03:43.200 --> 0:03:46.440 more advanced stuff to other nations, I mean that opens 0:03:46.440 --> 0:03:48.560 the door to all kinds of things, including like, you know, 0:03:49.160 --> 0:03:51.920 military sales or what have you. And so we're really 0:03:51.960 --> 0:03:54.040 an uncharted territory here right now in a lot of 0:03:54.040 --> 0:03:57.480 ways on this. But the bottom line is Trump likes 0:03:57.520 --> 0:03:59.560 the idea of these chips moving, in part because he's 0:03:59.600 --> 0:04:02.560 calling them obsolete. Of course they're not quite obsolete, but 0:04:03.000 --> 0:04:05.440 it's so long as the US government is getting a cut. 0:04:05.760 --> 0:04:06.320 S in Prince. 0:04:06.480 --> 0:04:08.120 We don't know who actually is getting a cut. We 0:04:08.120 --> 0:04:09.880 don't know if there's gone to general revenue or if 0:04:09.920 --> 0:04:11.560 the Commerce Department was steered this summer. 0:04:11.600 --> 0:04:12.720 It's all so unclear. 0:04:13.880 --> 0:04:16.240 I think what the President was alluding to was Jensen 0:04:16.279 --> 0:04:18.839 one coming to a meeting with him to talk about 0:04:19.680 --> 0:04:22.560 a lower power version of Blackwell, which the market has 0:04:22.600 --> 0:04:25.240 speculated is called B thirty, and Nvidia has never said 0:04:25.240 --> 0:04:28.560 anything about the analyst community looked at this Chinese reaction 0:04:28.640 --> 0:04:32.440 and said, it's a tactic in the broader US trade negotiations. 0:04:32.560 --> 0:04:35.279 You've had a busy twenty four hours because Intel CEO 0:04:35.640 --> 0:04:38.000 Bhutan also came to see the president. 0:04:38.279 --> 0:04:41.120 What's the latest there, Yeah, they. 0:04:41.000 --> 0:04:44.839 Had their meeting here yesterday. Trump sometimes calls in reporters 0:04:44.839 --> 0:04:47.480 to these meetings that didn't happen yesterday. You know, there's 0:04:47.480 --> 0:04:49.400 been a lot of to and fro between them of 0:04:49.880 --> 0:04:52.240 whether that is sort of a soured relationship and whether 0:04:52.720 --> 0:04:56.039 some would put pressure for a swap of leadership there. 0:04:56.080 --> 0:04:58.440 They've been sort of positive signs out of it. Trump 0:04:58.480 --> 0:05:00.400 saying that they had a good meeting is sort of 0:05:00.440 --> 0:05:03.159 teeing up future meetings with his cabinet, and so the 0:05:03.160 --> 0:05:05.840 pressure seems to be off a little bit on that 0:05:05.880 --> 0:05:07.520 one for now. But we all know the President can 0:05:07.520 --> 0:05:09.960 be mercurial on these things, and so it's sort of 0:05:10.600 --> 0:05:12.880 a time will tell situation. There's a briefing here in 0:05:12.880 --> 0:05:14.360 a couple of hours. We make it a little more 0:05:14.360 --> 0:05:17.359 detail on what they spoke of in that meeting. Trump 0:05:17.360 --> 0:05:19.800 has been taking sort of a lot a lot of these, 0:05:20.120 --> 0:05:22.320 but his focus seems to be elsewhere. Today he's teeing 0:05:22.320 --> 0:05:25.640 off on Goldman and threatening to sue J Powell. 0:05:25.839 --> 0:05:26.760 So it's a big day. 0:05:26.640 --> 0:05:29.440 Here at Bluemberg, you know, for when it comes to 0:05:29.440 --> 0:05:32.240 the light of stuff. But right now I think it 0:05:32.320 --> 0:05:34.400 seems like they're out of the woods a little bit. 0:05:35.080 --> 0:05:36.520 If you're Intel Josh. 0:05:36.400 --> 0:05:38.640 Wing Grove, we thank you for the perspective, at least 0:05:38.640 --> 0:05:41.320 on the tech executives. Let's deep dive a little bit 0:05:41.360 --> 0:05:43.760 more with an investor take on the global chip sector. 0:05:43.800 --> 0:05:46.520 Scott Landers here in the studio Horizon Investment cio. 0:05:47.279 --> 0:05:49.080 How do you navigate. 0:05:49.560 --> 0:05:53.280 The president's impact on certain companies, whether it's about them 0:05:53.320 --> 0:05:55.000 doing business or who leaves their businesses? 0:05:55.240 --> 0:05:57.800 Well, I mean this is the question of the day today, 0:05:57.920 --> 0:06:00.760 at least having to do with Trump, and I think 0:06:00.760 --> 0:06:03.040 currently what we have to understand is that Trump at 0:06:03.080 --> 0:06:05.680 his heart is a commercial guy. And so you know, 0:06:05.720 --> 0:06:07.080 what we're what we're trying to figure out is like 0:06:07.120 --> 0:06:09.600 what are the rules of the game that are acceptable 0:06:09.680 --> 0:06:11.200 to him in order to actually run our. 0:06:11.160 --> 0:06:12.680 Businesses and in order to in order to sort of 0:06:12.720 --> 0:06:13.200 move forward. 0:06:13.279 --> 0:06:14.800 And so I think sort of the discovery process of 0:06:14.800 --> 0:06:16.640 figuring out, like what are the deals that are acceptable 0:06:16.680 --> 0:06:18.400 to him in terms of like what do we have 0:06:18.440 --> 0:06:20.720 to give in order to let him sort of leave 0:06:20.800 --> 0:06:23.560 us alone to someone to actually run our businesses. You know, 0:06:23.600 --> 0:06:25.360 that discovery process, I think is what the economy is 0:06:25.360 --> 0:06:27.320 really and here it's specifically the chip makers are really 0:06:27.320 --> 0:06:28.800 sort of going through right now, and I think they're 0:06:28.800 --> 0:06:30.920 getting to a place that they understand the rules of 0:06:30.960 --> 0:06:33.440 the game. So that's actually an acceptable landing spot, I think. 0:06:33.880 --> 0:06:35.960 But the game of Ping Pong, for the likes of 0:06:36.040 --> 0:06:38.520 Lisa Su and indeed of Jenson Wang, has been hard 0:06:38.520 --> 0:06:41.440 when it's accessing China, and already maybe we see the 0:06:41.520 --> 0:06:45.279 ramifications of that pullback of their pair down chips. The 0:06:45.320 --> 0:06:47.440 fact that China is saying we don't even want them, 0:06:47.920 --> 0:06:50.280 is that a concern for you? The lack of access, 0:06:50.320 --> 0:06:53.280 the lack of demand potentially the longer term, so sophisticated 0:06:53.320 --> 0:06:53.920 chips from China. 0:06:54.000 --> 0:06:55.000 Look, I think it has to be. 0:06:55.360 --> 0:06:57.360 And so because you know, this is like one of, 0:06:57.400 --> 0:06:59.040 if not the largest chip market in the world, that 0:06:59.240 --> 0:07:01.599 they're having to sort of jump through hoops in order 0:07:01.640 --> 0:07:04.560 to actually build access and cut special deals in orders 0:07:04.560 --> 0:07:06.400 in order to build access, and so that's you know, 0:07:06.520 --> 0:07:09.320 again once we can finally understand what the rules of 0:07:09.360 --> 0:07:10.800 the game are going to end up being for how 0:07:10.800 --> 0:07:13.400 do we sell chips into this very large Chinese market, 0:07:13.840 --> 0:07:15.920 the better off we're going to be. But in the meantime, 0:07:16.280 --> 0:07:18.080 these CEOs are having to go around and try to 0:07:18.080 --> 0:07:20.240 try to cut these deals and try to understand you know, 0:07:20.320 --> 0:07:22.080 what is it that I'd actually need to do outside 0:07:22.120 --> 0:07:23.880 of just running my business and outside of doing all 0:07:23.880 --> 0:07:25.320 the innovation that I have to do in order to 0:07:25.320 --> 0:07:27.000 make good chips. Okay, what do I have to do 0:07:27.280 --> 0:07:30.160 on the political front to actually access the second largest 0:07:30.160 --> 0:07:31.000 ship market in the world. 0:07:32.320 --> 0:07:36.400 Scott from the CIO's perspective, the president of the United 0:07:36.400 --> 0:07:39.320 States cutting an ad hoc deal where they get a 0:07:39.360 --> 0:07:43.240 share of revenue in exchange for an export license. Did 0:07:43.240 --> 0:07:45.840 you see that coming? And do you expect it to 0:07:45.920 --> 0:07:49.400 be replicated to other parts of the technology industry and 0:07:49.440 --> 0:07:50.520 how do you model for it? 0:07:51.440 --> 0:07:53.760 Well that I'm not sure that you do really model 0:07:53.800 --> 0:07:55.440 for this. I think I think we're in a more 0:07:55.440 --> 0:07:57.960 of a read and react situation with Trump and that's 0:07:58.000 --> 0:07:59.280 and that's franctly how you do have to deal with 0:07:59.320 --> 0:08:00.440 Trump on some of these policies. 0:08:00.480 --> 0:08:01.200 I mean it is. 0:08:01.360 --> 0:08:03.840 It is not a forecasting exercise, is a read and 0:08:03.880 --> 0:08:06.840 react exercise, and so you know that that that you 0:08:06.840 --> 0:08:08.440 know that I think that's just how we have to 0:08:08.440 --> 0:08:09.840 sort of think about it. 0:08:10.000 --> 0:08:12.440 Scott, What does read and react exercise look like at 0:08:12.480 --> 0:08:14.920 Horizon Investments? What did it like this morning in the 0:08:15.000 --> 0:08:16.040 last twenty four hours? 0:08:16.640 --> 0:08:19.080 Well, I mean, I think it means to some extent 0:08:19.120 --> 0:08:21.280 like figuring out are the things that we're facing in 0:08:21.400 --> 0:08:22.760 terms of some of these some of these hurdles that 0:08:22.800 --> 0:08:24.080 are that are new as of you know, the last 0:08:24.120 --> 0:08:26.440 twenty four hours, are these really game changes for some 0:08:26.440 --> 0:08:27.960 of the more in the medium and the longer term 0:08:28.000 --> 0:08:29.800 themes that we think are going to really be important 0:08:30.000 --> 0:08:31.760 in terms of what's what's driving some of these names 0:08:31.760 --> 0:08:33.120 and what's what's driving some of the some of this 0:08:33.320 --> 0:08:36.600 productivity shifts, we don't think they are. And again I think, 0:08:36.640 --> 0:08:38.599 you know, I think because we understand that he's a 0:08:38.600 --> 0:08:40.800 commercial guy, and he wants to cut deals like he 0:08:40.800 --> 0:08:41.800 wants deals to get done. 0:08:41.800 --> 0:08:43.040 He doesn't want deals not to get done. 0:08:43.040 --> 0:08:44.240 He wants deals to get done. 0:08:44.360 --> 0:08:45.840 And so if that if that is sort of your 0:08:46.040 --> 0:08:48.560 starting place, and these deals are somewhat acceptable, and we 0:08:48.640 --> 0:08:50.560 understand what what they're going to look like. It doesn't 0:08:50.559 --> 0:08:53.000 really change the medium term look is this is the 0:08:53.040 --> 0:08:55.599 most important technology in a generation, and you've got to 0:08:55.640 --> 0:08:56.319 be on board with it. 0:08:57.800 --> 0:09:00.400 I'll jump in here and just think about you've got 0:09:00.440 --> 0:09:00.839 to be on board. 0:09:00.880 --> 0:09:01.800 You've got to read and react. 0:09:02.000 --> 0:09:05.719 Does this change the ultimate tailwinds of generative AI from 0:09:05.760 --> 0:09:09.680 your perspective for names at AMD, for names like nin 0:09:09.840 --> 0:09:12.839 Video More broadly, the valuations that we've garnered have been 0:09:12.880 --> 0:09:15.880 a global opportunity. But if we cut off China off, 0:09:15.960 --> 0:09:17.920 China moves away and they want to go domestic, does 0:09:17.960 --> 0:09:19.800 that impact your desire to get into these names? 0:09:20.040 --> 0:09:22.160 It does on the margin, I'm sure. I mean, I 0:09:22.200 --> 0:09:24.000 don't know that it has to. It sort of has to. 0:09:24.120 --> 0:09:26.840 It has to on the margin, But it doesn't really 0:09:26.920 --> 0:09:29.120 change the long term story. We haven't seen anything today 0:09:29.200 --> 0:09:31.480 or the new cycle the last twenty four hours out 0:09:31.480 --> 0:09:33.160 of some of these actions that really change what we 0:09:33.200 --> 0:09:35.240 think about about that medium term and about some of 0:09:35.280 --> 0:09:37.560 these access issues. Is it going to make it more expensive, Yes, 0:09:37.720 --> 0:09:40.240 to make it more complicated, of course, But it doesn't 0:09:40.280 --> 0:09:42.800 really change some of the more fundamental narrative in terms 0:09:42.840 --> 0:09:45.920 of do we want to be in these names, Absolutely. 0:09:45.520 --> 0:09:45.720 We do. 0:09:45.920 --> 0:09:46.960 Do you want to be an Intel? 0:09:47.640 --> 0:09:49.440 Intel's a little bit a little more complicated because we 0:09:49.440 --> 0:09:51.160 don't know that they've got leadership in place that can 0:09:51.200 --> 0:09:52.880 get them to that next stage and get them into 0:09:52.880 --> 0:09:54.560 the right types of chips. It's not just can you 0:09:54.600 --> 0:09:56.600 produce chips? Can you produce the right types? And that's 0:09:56.679 --> 0:09:58.760 that's the big question overring Intel right now. 0:10:00.040 --> 0:10:01.679 God, can we go a little deeper on that? I 0:10:01.960 --> 0:10:04.920 guess what you're hinting at is that lit Bhutan's visit 0:10:05.040 --> 0:10:09.280 to the White House doesn't necessarily solve the tension that's 0:10:09.280 --> 0:10:11.559 they're based on the President's post last week. 0:10:12.200 --> 0:10:14.760 Well, look, Trump doesn't like to be to be wrong. 0:10:14.960 --> 0:10:16.960 It doesn't like to admit and admit that he's wrong. 0:10:16.960 --> 0:10:18.880 And so if if he calls for somebody to be fired, 0:10:19.480 --> 0:10:21.360 and it's it's a pretty high hurdle to get him 0:10:21.400 --> 0:10:22.559 to back off of something like that. 0:10:22.679 --> 0:10:23.840 But I'm not saying it's impossible. 0:10:24.160 --> 0:10:26.640 But but but in terms of you know, the the 0:10:26.640 --> 0:10:28.960 future leadership an Intel, it would be a lot easier 0:10:29.120 --> 0:10:31.080 for Intel to h to make a change like that 0:10:31.200 --> 0:10:33.280 rather than to try to sort of fight against the stream, 0:10:33.480 --> 0:10:35.360 you know, and sort of against the river. That is 0:10:35.440 --> 0:10:37.920 that is the Trump truth post, and so that you 0:10:37.960 --> 0:10:39.840 know that that you know that being said, I don't 0:10:39.880 --> 0:10:41.760 know what they end up doing, but but it does 0:10:41.840 --> 0:10:44.520 make things, you know, infinitely more complicated in an already 0:10:44.559 --> 0:10:48.000 infinitely complicated situation for Intel from a corporate structuring standpoint 0:10:48.040 --> 0:10:49.120 or from an innovation standpoint. 0:10:49.160 --> 0:10:51.360 That's the Martians. The market is already obviously questioning. 0:10:53.000 --> 0:10:56.319 Scott Ladanam of Horizon Investments, Thank you very much. Now 0:10:56.320 --> 0:10:59.600 coming up on Bloomberg Tech, Nancy Tengla joins to talk 0:10:59.640 --> 0:11:03.000 to some more on Nvidia on China, but also Apple 0:11:03.160 --> 0:11:06.959 now in the crosshairs of Elon Musk an Xai. 0:11:07.120 --> 0:11:09.560 That's coming up next. This is Bloomberg Tech. 0:11:24.240 --> 0:11:27.760 Elon Musk lashed out against Apple's app store practices in 0:11:27.800 --> 0:11:30.520 a post late on Monday, accusing the iPhone maker of 0:11:30.600 --> 0:11:34.440 favoring open Ai, saying Apple makes it impossible for anyone 0:11:34.520 --> 0:11:36.800 other than open Ai to reach the top of the 0:11:36.840 --> 0:11:41.240 app store charts. Bloombo's Kirkwagner joins us now for more. 0:11:41.320 --> 0:11:43.760 In fact, it was several posts on x throughout the 0:11:43.800 --> 0:11:45.800 time I went to bed last night here in London 0:11:45.800 --> 0:11:48.720 and the time I woke up in aggregate. What's at 0:11:48.760 --> 0:11:51.959 the core of Musk's complaint. 0:11:51.679 --> 0:11:55.120 Yeah, he is claiming antitrust behavior by Apple, saying that 0:11:55.200 --> 0:11:58.360 the company, is you point out ed, is favoring open Ai. 0:11:58.400 --> 0:12:01.160 It's putting open Ai in more prominent positions on the 0:12:01.160 --> 0:12:04.840 App Store, you know, artificially in his mind, putting them 0:12:04.920 --> 0:12:07.719 higher on rankings lists. Now, of course, some of those 0:12:07.800 --> 0:12:11.240 rankings lists are editorially curated by Apple employees. 0:12:11.280 --> 0:12:12.120 That's been the case for. 0:12:12.679 --> 0:12:15.560 Years, and it's always been a challenge for developers to 0:12:15.559 --> 0:12:17.480 try and get onto those lists, to try and get 0:12:17.520 --> 0:12:20.320 that sort of publicity that way. But again, a lot 0:12:20.360 --> 0:12:22.839 of this is also just based on rankings which apps 0:12:22.840 --> 0:12:26.480 are downloaded the most frequently, and in some cases open 0:12:26.520 --> 0:12:29.280 ai and chat gybtr are the top of those lists. 0:12:29.679 --> 0:12:33.160 And you use X's own community notes and they point 0:12:33.200 --> 0:12:35.360 out that it hasn't always been open Ai and the 0:12:35.440 --> 0:12:37.640 top of the pile when it comes to other generative 0:12:37.640 --> 0:12:41.240 AI chatbots. Others have eclipsed it, even since the open 0:12:41.320 --> 0:12:42.760 Ai and Apple deal cut. 0:12:43.000 --> 0:12:45.040 But also some Almand weighed in a little bit too. 0:12:46.600 --> 0:12:47.240 He did he. 0:12:47.280 --> 0:12:50.160 Had some sharp words for elon Musk, pointing out that 0:12:50.240 --> 0:12:52.520 it was sort of rich for Elon Musk to complain 0:12:52.520 --> 0:12:55.000 about this when, in Sam Altman's words, you know, he's 0:12:55.000 --> 0:12:57.560 putting his thumb on the scale on the X algorithm, right, 0:12:57.600 --> 0:13:00.320 He's changing the things that you can see on X 0:13:00.600 --> 0:13:05.880 to reflect Elon's view of the world or Elon's favorite topics. 0:13:05.920 --> 0:13:09.160 And so that was sort of the throwback that Altman 0:13:09.280 --> 0:13:11.679 had for Musk there, and the two of them obviously 0:13:11.720 --> 0:13:13.679 have a long history Caroline, as we've talked. 0:13:13.480 --> 0:13:14.720 About repeatedly on the show. 0:13:14.800 --> 0:13:17.040 So for those who have followed, this is sort of 0:13:17.080 --> 0:13:19.360 just the latest in that saga. 0:13:19.480 --> 0:13:22.120 So Apple has not responded to requests for comment on this, 0:13:22.200 --> 0:13:24.440 but like you, I went through all the documents available 0:13:24.480 --> 0:13:28.320 when Apple explains the methodology behind the rankings, but Elon 0:13:28.440 --> 0:13:31.160 Musk is also complaining that open ai and Apple were 0:13:31.200 --> 0:13:35.079 technology partners and for that reason they have a bias 0:13:35.160 --> 0:13:35.600 toward them. 0:13:35.640 --> 0:13:39.360 Can you explain that that. Yeah, So last year. 0:13:39.120 --> 0:13:43.280 At WWDC, Apple announced a partnership with chat GPT that 0:13:43.320 --> 0:13:45.760 it was going to integrate some of open AI's technology 0:13:45.840 --> 0:13:48.840 into the iPhone, And so he's claiming, you know, and 0:13:48.960 --> 0:13:53.079 this is the reason in Elon Musk's mind that open 0:13:53.080 --> 0:13:56.520 ai is sort of getting this favorable treatment. Now, I 0:13:56.559 --> 0:13:58.560 have to point out that Elon Musk is not the 0:13:58.559 --> 0:14:02.120 first person to kind of go after Apple over the 0:14:02.160 --> 0:14:05.200 years for making things difficult on developers they might compete with. Right, 0:14:05.280 --> 0:14:07.800 Facebook and Mark Zuckerberg are the top of the list 0:14:07.840 --> 0:14:10.280 in terms of being in the drum about Apple being 0:14:10.400 --> 0:14:13.200 anti competitive over the last several years with the app 0:14:13.200 --> 0:14:15.800 store fees that they take and other things. So Elon 0:14:15.880 --> 0:14:18.040 Musk is not alone and sort of his view on 0:14:18.120 --> 0:14:22.240 this now, whether that view is simply formed in any 0:14:22.320 --> 0:14:25.360 actual real fact or just opinion, I think is. 0:14:25.320 --> 0:14:26.080 The challenge here. 0:14:26.120 --> 0:14:30.080 And clearly he's very upset with open AI's relationship right 0:14:30.080 --> 0:14:31.240 now with Apple. 0:14:31.960 --> 0:14:34.560 Okay, bluebos Kurt Wagner, And as Kurt said, Elon Musk 0:14:34.600 --> 0:14:37.960 has threatened Apple with litigation in the antitrust context. Will 0:14:38.000 --> 0:14:40.640 bring more as we get it. Let's bring in Apple 0:14:40.800 --> 0:14:43.400 and Tesla investor to talk a bit more about it. 0:14:43.480 --> 0:14:47.880 Nancy Tengler, CEO and CIO for Laffatengler Investments. And you know, 0:14:47.960 --> 0:14:50.480 like you have exposure to Apple, I think you've added 0:14:50.520 --> 0:14:53.760 to it recently. You know the Tesla story, but also 0:14:53.880 --> 0:14:56.840 Elon Ink's story really well when it comes to AI, 0:14:58.120 --> 0:15:00.960 how concerned are you about this situation with Elon Musk, 0:15:01.520 --> 0:15:03.200 you know, essentially going off to Apple. 0:15:05.200 --> 0:15:08.720 I ed listen. I think everybody's acting to script. 0:15:09.000 --> 0:15:12.000 So you know, Elon will describe himself as someone who's 0:15:12.160 --> 0:15:15.880 who's programmed for war. This is one way for him 0:15:15.960 --> 0:15:18.960 to gain shelf space, is to raise awareness, to claim 0:15:19.360 --> 0:15:23.640 foul and then hopefully get some concessions from Apple. In 0:15:24.160 --> 0:15:26.800 terms of the effect on Apple, I don't think it's 0:15:26.840 --> 0:15:29.520 going to be long standing. I think there will be 0:15:29.760 --> 0:15:32.320 some sort of behind the scenes handshake. 0:15:32.480 --> 0:15:35.920 But it always matters where you get into these stocks. 0:15:35.960 --> 0:15:38.160 And so we were adding to Tesla at two forty 0:15:38.240 --> 0:15:41.480 during the tariff tantrums. You know, at three thirty three, 0:15:41.520 --> 0:15:44.000 I'm pretty happy with the holdings. And then we added 0:15:44.000 --> 0:15:47.600 to Apple last Tuesday. That was just sheer luck. And 0:15:47.720 --> 0:15:49.480 you know, we picked it off at two hundred and two, 0:15:49.520 --> 0:15:52.080 and we can wait around. 0:15:51.000 --> 0:15:53.040 For things to write size. 0:15:53.080 --> 0:15:55.000 But I don't think this is the end of the 0:15:55.000 --> 0:15:57.440 app store, and I don't think it's going to be 0:15:57.640 --> 0:16:00.320 a big headache. You know, he's filed a lot of 0:16:00.360 --> 0:16:03.600 lawsuits that have gone into the Elon Musk lawsuit black hole, 0:16:04.200 --> 0:16:06.240 so I think we'll get some resolution. 0:16:06.440 --> 0:16:07.440 He kinks Floyd is busy. 0:16:07.560 --> 0:16:09.280 That's for sure, about one point ten percent if you're 0:16:09.320 --> 0:16:10.600 looking at Apple's share price soon. 0:16:11.000 --> 0:16:12.600 No one too worried, Nancy. 0:16:12.560 --> 0:16:15.200 But just love tell a little bit of the AI 0:16:15.280 --> 0:16:17.960 opportunity within Tesla and why you're not adding to it 0:16:18.000 --> 0:16:20.200 at the moment. Because there's been much about made about 0:16:20.240 --> 0:16:22.840 whether they'd invest more broadly in xai itself. 0:16:22.840 --> 0:16:24.560 There's a lot of cross pollination that goes on. 0:16:26.360 --> 0:16:27.120 Yeah, I think the. 0:16:27.040 --> 0:16:29.680 Cross pollination would be good. I'd love to see Tesla 0:16:29.760 --> 0:16:34.880 absorb XAI. I use rock religiously, and there's I just 0:16:34.920 --> 0:16:37.320 think it. I just happened to think it's the best solution, 0:16:38.360 --> 0:16:41.400 so you know, I'd love to see more people utilize 0:16:41.400 --> 0:16:44.400 it and see the company continue to go deeper into 0:16:44.440 --> 0:16:47.040 the AI portions of their business and have it benefit 0:16:47.080 --> 0:16:50.880 Tesla's shareholders. We'll see when we get the shareholder vote 0:16:51.320 --> 0:16:53.920 where you know, where the shareholders come down in terms 0:16:53.920 --> 0:16:55.040 of investing further. 0:16:55.200 --> 0:16:58.800 But I like the ecosystem. 0:16:58.960 --> 0:17:01.600 We're building out a strategy that focuses on all these 0:17:01.640 --> 0:17:07.719 new frontier you know, opportunities, quantum nuclear robotics, jen AI, 0:17:08.000 --> 0:17:11.000 and in that we will have front and center. 0:17:11.040 --> 0:17:12.800 One of our largest holdings will be Tesla. 0:17:14.400 --> 0:17:16.840 Nancy I broke the story last week that Elon Musk 0:17:16.920 --> 0:17:20.119 requested that the Dojo project be shut down, and he 0:17:20.240 --> 0:17:23.440 confirmed it on Sunday in a post on X and 0:17:23.520 --> 0:17:25.960 I reported today a lot of that engineering talent's been 0:17:25.960 --> 0:17:30.439 reassigned across their other chip efforts. How central was Dojo 0:17:30.520 --> 0:17:32.879 to your thesis with Tesla? Did you pay attention to 0:17:32.920 --> 0:17:34.399 that one? 0:17:34.640 --> 0:17:38.760 Yeah, and congrats on on the story, ed, Yes, and no. 0:17:38.960 --> 0:17:42.080 I mean it was so so nascent in. 0:17:43.640 --> 0:17:46.640 Its origins that we were watching it. 0:17:46.760 --> 0:17:51.240 We are certainly focused on quantum computing and the elements 0:17:51.320 --> 0:17:53.919 that will drive it, but we didn't we didn't have 0:17:54.000 --> 0:17:57.119 it in our expectations for future earning Scrows. And I 0:17:57.119 --> 0:17:58.920 think that's a lot of what you have to do 0:17:59.680 --> 0:18:00.240 with with. 0:18:00.240 --> 0:18:01.280