Paramount’s Deal Playbook, Trump Opens Nvidia’s China Door, Saudis Loosen Drinking Laws | Diet TBPN

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Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:02John Coogan?

  Just a few days until Christmas. We're so excited. We're live from the TVP and Ultra Dome, the Temple of Technology, the Fortress of Finance, the Capital Capital.

• 0:09Jordi Hays?

  Capital.

• 0:10John Coogan?

  No travel until Christmas, baby. No travel until the new year. We're in the Ultra Dome hanging out. We're monitoring the situation. We're monitoring

• 0:19Jordi Hays?

  Always.

• 0:19John Coogan?

  The Paramount Netflix Warner Brothers situation because this is one of the most fascinating deals. The deal has gone hostile. Paramount has launched a hostile bid to acquire Warner Brothers. It's an all cash offer.

• 0:31Jordi Hays?

  A little end of year entertainment.

• 0:33John Coogan?

  77.9 billion. Really, really. And it's a fun one because I feel like it's obviously tech adjacent, but it's not. It's not the story that people have been monitoring all year. We've been talking about foundation models. That whole story has just gotten a little bit stagnant.

• 0:46Jordi Hays?

  Legacy Media said they got tired of not getting enough attention.

• 0:49John Coogan?

  Exactly.

• 0:50Jordi Hays?

  Let's spice it up a little bit.

• 0:51John Coogan?

  Hey, let's spice it up. Here's something new to learn about. So everyone's having fun. Everyone's learning new things. And I could tell because when I came in today, I had a bunch of questions that people were throwing at me about how all of this works. Why, why, why isn't Warner Brothers just going with the highest price? Like when I sell a stock, I don't care if Citadel or Jane Street's buying it. If I'm selling 80 bucks a stock, just give me the best price. But when you're selling an 80 billion dollar company, there are other considerations and it goes beyond just maximizing shareholder value. And so I wanted to break down a few of those. So I did that in today's newsletter. We can run through that and then we can run through some of the news. This question, you know, it seems obvious. The board has a fiduciary duty to maximize shareholder value. That's

• 1:35John Coogan?

  legal requirement to take the higher offer. And yet that's not what's happening. Like yesterday, we saw that, that Ellison and Paramount came in with over 100 billion. Of course, that included the CNN, the TV assets. But even when you broke it out, it seemed like it was very clear that Ellison was willing to pay more money and make a higher offer. So under what circumstances can a board, whose job it is to maximize shareholder value, not take the higher offer? They can't just, it can't just be whoever we had the better dinner with, right? Which is part of the news, of course. They, they went out to dinner. And Paramount CEO David Ellison sent a text to David Zaslove, who's running Warner Brothers, after they made a hostile bid today to buy Warner Brothers.

• 2:19John Coogan?

  And David text the other David and says, David, but I guess he misspelled his name, even though that's his name, which is just funny. But anyway, he says, I appreciate your underwater today. So I wanted to send you a quick text. Know that despite the noise of the last 24 hours, I have nothing but respect and admiration for you and the company. It would be the honor of a lifetime to be your partner and to work and to be the owner of these iconic assets. He's talking about Foghorn Leghorn. He's talking about Porky Pig. He's also talking about Batman and Superman, obviously, and Harry Potter and Lord of the Rings and a million other iconic assets, which is true.

• 2:56John Coogan?

  If we have the privilege to work together, you will see that my father and I are the people you had dinner with. Which I like that. I think that's cool. They had dinner, they-

• 3:06Jordi Hays?

  It's a fantastic text.

• 3:07John Coogan?

  Yes, yes, yes. It's a great one. There are two main reasons why you don't just take, why your size might not be size. Directors at a company like Warner Brothers, they have to maximize shareholder value. But maximizing shareholder value is an expected value calculation. So if you come in with a hundred billion dollar offer, and I think there's a 75% chance that you're going to deliver that. And someone else comes in with an 80 billion dollar offer, and I think there's a hundred percent chance that they're going to deliver that. Well, the expected value of your bid is 75 billion. The expected value of their bid is 80 billion. I go with the 80 billion, even though it's like a lower headline number, it has a higher-

• 3:45Jordi Hays?

  How much of the calculus do you think is just a deal that will actually get done?

• 3:49John Coogan?

  A deal that doesn't get done could still have value because of a breakup fee. You could, in theory, go into a deal that you know is impossible. And the example that I gave is what if ByteDance came in? And they were like, hey, you know, we're a 400 billion dollar media company.

• 4:05Jordi Hays?

  We'd love to own Porky Pig.

• 4:06John Coogan?

  We'd love to own these iconic assets. Let's pick up Warner Brothers. We'd love to own CNN too. You know, who knows what we'd put on the TV?

• 4:13Jordi Hays?

  We already own TikTok.

• 4:14John Coogan?

  We already own TikTok. Why not CNN also? Why not Shark Week? But obviously, the government would block that. And we have CFIUS, which is an organization in the US government that determines whether or not an international buyer can take an American company because of intellectual property, all sorts of geopolitical considerations. We don't want another country cornering a market on a really key piece of the supply chain, like the Nvidia H200, for example. Then there's also just the FTC. So certain deals, like I gave you the example yesterday, like Disney, Disney would be so blocked, I think, that that deal doesn't even get kicked around. No one even talks about it. And because it would get blocked by the FTC.

• 4:57John Coogan?

  But it would maximize shareholder value if Disney came and said, yeah, we'll give you a $10 billion breakup fee and we want to try and buy you for 200 billion or a trillion or 200 million. Like, you would immediately say yes because you just want the breakup fee. But having, being in this turmoil and being in this limbo and not being able to sign deals with other, that has an opportunity cost, right? And so you might want to back off of that. And so, basically, the...

• 5:19Jordi Hays?

  Yeah, you look back at the Figma acquisition. Adobe paid a billion-dollar breakup fee. So that's effectively like non-dilutive financing for Figma. That has a happy ending because they were able to, you know, re-accelerate, get out into the public markets. But there was another situation where they went through a rough patch and actually really needed that capital to get through.

• 5:44John Coogan?

  There's basically two buckets of risk that I think most dealmakers would be considering in this situation. First is financing risk. So will they come through with the money? And what money are they paying with? Because the initial offer, this is the history. There's actually been six offers put forward by Paramount. David Ellison is putting on a clinic of just not taking no for an answer. Because all the way back on September 14th, he offered $19 a share. And 60% of that was cash. So 60% cash offer. Then September 30th, two weeks later, he comes back $22 a share and ups the amount of cash to 66.7%.

• 6:23Jordi Hays?

  Zaslav is doing a masterclass in making your opponent negotiate against themselves.

• 6:28John Coogan?

  100%.

• 6:29Jordi Hays?

  It's actually crazy.

• 6:30John Coogan?

  And so October 3rd, $23.50 a share, 80% cash. Then November 20th, $25.50 a share, 85% cash. Then finally, December 1st, $26.50 per share, 100% cash. December 4th, $30 a share, 100% cash. Now, why does this matter? Well, it's because you get locked into owning the shares of, if 40% of the shares is paramount. And then while it's closing, the, the stock trades down, you wind up getting less value. And so the 80 billion today might wind up being 70 billion later. And that doesn't maximize shareholder value. There's also just the, just the question of like, can you actually marshal the cash? Just like if somebody comes to you and you're about to sell your house to them. And they say, yeah, I'm definitely going to get a loan for this.

• 7:13John Coogan?

  Well, that's a financing risk. Maybe they don't. Maybe they back out of the deal.

• 7:16Jordi Hays?

  That's why cash offers oftentimes.

• 7:18John Coogan?

  Exactly. If you can just prove that you have the cash, that, that makes a difference. And I mean, he's effectively gone and done that because he's teamed up with Jared Kushner reportedly. And gone around the world, got, got a whole bunch of different sovereign funds and just really people. Anyone with big deep pockets is, has, has kind of, you know, said, yes, I'm, I'm down to come along on this ride. And put up a bunch of the capital. The capital has been marshaled. It seems like it's ready to go. And then also you have Larry Ellison, who has three times as much money, I think, than the whole deal value. Something like that, 275 billion to his name.

• 7:52Jordi Hays?

  Assets, not cash.

• 7:54John Coogan?

  Assets, not cash, but.

• 7:55Jordi Hays?

  He should not just, I know they want it, but do not market sell your Oracle position, please.

• 8:01John Coogan?

  Yeah, but he's like, I'm actually, I'm actually going all cash now. But, but he's, he's effectively acted as backstop. And so everyone who's come in and said, okay, who, I guess I'm good for 10 billion of that 80 billion. But only if everyone else is in. Larry Ellison reportedly has come in and said, well, you know, if, if there's one person in the bunch that, that backs out of their slug at the last second, I'll jump in and get them. He's not saying he's going to put up the whole 80, he's just saying he's backstopping it. David Ellison feels very, you know, good because he's done what Zaslov wanted him to. He said, hey, they wanted an all cash offer, I brought them an all cash offer, I brought them an offer that's higher, and we believe that it's, there's no reason why factor number

• 8:45John Coogan?

  two should come into play, and factor number two is regulatory approval. And so, there's been this question about, will Netflix get approved? If there was a different buyer, it would have even more regulatory risk, and so, you don't want to, even if the price is higher, you don't want to accept a higher price with a lower chance of actual, actual conversion.

• 9:04Jordi Hays?

  Bobby thinks NLE Chapa might up his offer to 100K of cash and get back in the mix.

• 9:10John Coogan?

  In that scenario, at least you know that the 100K cash is real, and it's going to be delivered on the day of close.

• 9:17Jordi Hays?

  Maybe in actual cash.

• 9:18John Coogan?

  Probably, I, I think that was the, that, that is funny, because that, that was the joke of that meme, was that he was giving like, actual cash. When we're saying cash offer here, of course, we are not talking about physical cash. Is Tyler doing money spread? What has he got? Did Christmas come early for you?

• 9:33Speaker 02

  So, I, I had a question though, what makes the Paramount offer, like, hostile? Is it that it's like, reacting to the Netflix offer?

• 9:40Jordi Hays?

  Is that the Netflix board, or sorry, the Warner, Warner Brothers board went with Netflix, and they're coming, it's hostile because they're saying, screw the board decision, we're, we want to go to the shareholders.

• 9:50Speaker 02

  Okay, yeah, because the, it sounded like they had a nice dinner and the techs were like, kind.

• 9:54John Coogan?

  Yes, yes, yes, no, no, no. No, no, hostile in the sense of like, of like, not accepting the final, like, the final decision there, and then, and then also, there is a, there is a point where you can appeal directly to the shareholders and, and make the, you can actually make the legal case that the board is not acting in, in their fiduciary duty, and in their, in the interest of shareholders. But again, these things need to be argued in shareholder lawsuits, because it is fuzzy. Like, if, if I say, I'm offering you 100 billion, and someone else is offering 80 billion, and the board says, yeah, but that 100 billion has only a 75% chance of going through, you have to discount that, now, now the board says it's worth 75. But whoever made that offer can say, no, we're actually good for it.

• 10:39John Coogan?

  You should apply a 10% discount rate and treat our offer as if it's 90% or 100%. And so all of those arguments, those can be made in the court and the shareholders can, you know, react to that. And if the shareholders align and say, yeah, actually, we think we'd be getting more money here with this, with this deal, then they can push back against the board at a certain point. But yeah.

• 11:00Jordi Hays?

  Friend of the show, high-powered media exec says, Zaslav has been architecting this situation for the last 12 months, sitting pretty, and he's a wily old fox and has what he has been shooting for. Two heavy hitters fighting over a deal. Don't doubt there will be a couple more turns here with the price or even another bidder coming in sideways.

• 11:25John Coogan?

  Which is remarkable because the price is so high already compared to where it was six months ago. Zaslav, it really feels like it's coming together that he will be remembered as like an incredible business executive for this deal.

• 11:37Jordi Hays?

  Possible deal guy of the year. He's in the conversation.

• 11:40John Coogan?

  He's definitely in the.

• 11:41Jordi Hays?

  Sam, Sam was, Sam looked like he was running away with it over the summer.

• 11:47John Coogan?

  That's true.

• 11:47Jordi Hays?

  Early fall and he lost ball control.

• 11:49John Coogan?

  He lost ball control. Yeah. There is a wrinkle that, that people haven't really been considering, which is the fact that Warner Brothers Discovery holds massive, a massive, often underrated vault of masculine cinema. And if this falls into the wrong hands, it could be.

• 12:08Jordi Hays?

  What is masculine cinema?

• 12:10John Coogan?

  Masculine, masculine cinema would be.

• 12:12Jordi Hays?

  Guys being dudes on film?

• 12:13John Coogan?

  So they own, they own a bunch of Clint Eastwood films. Dirty Harry, Magnum Force, The Enforcer, Heartbreak Ridge, American Sniper, Letters From Iwo Jima, Unforgiven, Gran Torino. They also own Rambo, The Whole Subversive Stallone, The Cobra Wing, Cobra, Demolition Man, The Specialist, Tango and Cash, Bullet to the Head, Get Carter, the 2000 remake. They also own Mad Max, Lethal Weapons, all of the Lethal Weapons, The Matrix, Blade, Mortal Kombat, 300, Rush Hour, Pacific Rim, and a number of dad and military shows, Band of Brothers, The Pacific Generation Kill. There's a whole host of.

• 12:54Jordi Hays?

  They should release the full DVD set just called Guys Being Dudes.

• 12:58John Coogan?

  Yes. They also own some Jason Statham properties, the Meg franchise, where Jason Statham fights a big shark.

• 13:03Jordi Hays?

  Whoa.

• 13:04John Coogan?

  Uh, Wrath of Man. Um, I guess, uh, most of the Guy Ritchie films are actually with Lionsgate or MGM. But, and, and I think this could be a, uh, you know, a, a, a big political hot button of what happens to the, the Rambo franchises, the, the Hollywood hunks. No one's talking about the Hollywood hunks. Everyone's focused on Looney Tunes characters. But if the Hollywood hunks fall into the wrong hands, it could be, uh, it, it could swing our entire culture potentially. You're hiding inordinate amounts of Middle Eastern funding sources in your takeover bid, are you not? Says boring business and not hiding it. It's out in the open. Like this is, this is, uh, this is like the playbook for these big deals.

• 13:41Jordi Hays?

  But again, it's double, double that of the amount of equity that the Allison's are putting in.

• 13:46John Coogan?

  Okay.

• 13:46Jordi Hays?

  Putting in around.

• 13:47John Coogan?

  Yeah. I mean, I think everyone assumes that there'd be a lot of Middle Eastern funding in this. That has become the standard funding instrument these days. Like EA Games, we just followed that story a little bit. Uh, that was obviously a huge amount.

• 14:00Jordi Hays?

  It's like 93%.

• 14:01John Coogan?

  Saudi money. Um, and that is part of the modern deal making playbook these days. A lot of venture funds have raised money over there. A lot of the big AI companies have raised money over there. Like, that seems like a foregone conclusion. If you need money, you go where the money is. Why do, uh, why do bank robbers rob banks? Cause that's where the money is.

• 14:20John Coogan?

  Trump says that the United States will allow Nvidia H200 chip sales to China and get a 25% cut. This is a pretty big change. I mean, we were talking about, um, not selling. I mean, I guess it's not Blackwell, right? It's Hopper. So we're still a generation behind. But was this, it was like a pretty nerfed chip before. We're getting less nerfed. We seem to move, we seem to be moving in a, in a more thumbs up direction, more, uh, let's, let's actually get the chips over to China. At the same time, AI is fake, so it doesn't matter. Right? That's the take. The, the pro-China take is that.

• 14:59Jordi Hays?

  It's SaaS.

• 15:00John Coogan?

  It's, it's SaaS or it's not, it's not like this, uh, nuclear bomb that's going to destroy everyone. So it's harder, it's getting harder to make the, uh, the, the, the Manhattan Project argument.

• 15:12Jordi Hays?

  And it feels impossible to make the argument that we're going to get them addicted to the US AI supply chain and they'll never develop, uh, their own capabilities. And so we want them.

• 15:23John Coogan?

  Well, I disagree with that. I think that that, I think that that argument actually holds. That argument holds for sure.

• 15:27Jordi Hays?

  I mean, I, I totally disagree. I think they're. I think China is smart enough to know they don't want to be dependent on any foreign country to produce any

• 15:37John Coogan?

  Yes, but I still think there's enough of like a market force within China that if we flood the market with cheap Nvidia chips, there will it'll just be expensive for them to keep propping up their local industry, even if they are aware of it, even if they know that they have to, it's a cost and it's something that a lot of AI researchers over there will just say, you know what, I'm already it's so much easier, the Nvidia ecosystem is so great, I'm just going to stick with that. I'm a little bit skeptical that like there isn't there, there's no advantage to to selling Nvidia chips there. I've become more receptive to that argument in particular, even though you have not. Tyler, what were you going to say about this?

• 16:14Speaker 02

  Yeah, I was just gonna say, I mean, we kind of joke about this, but it is kind of crazy the extent to which you can basically bake down all like AI policy questions to like if you are AGI-pilled.

• 16:25John Coogan?

  Yeah.

• 16:25Speaker 02

  Because like if you are, if you're Dario, I mean, you shouldn't be giving stuff to China. You also shouldn't you like if you are AGI-pilled, you should be thinking about safety, all these things like we had Keith Roy on, he doesn't seem super AGI-pilled. He's also like, oh, safety is a hoax, etc., stuff like this.

• 16:41John Coogan?

  Well, let's read through this Wall Street Journal article on the on the details of the new Nvidia deal.

• 16:45Jordi Hays?

  Notable that this seems to have been completely priced in already because Nvidia is actually down half a half a point today.

• 16:52John Coogan?

  Yes, it's been such a dramatic story all year and yet it's always felt like a complete footnote in the overall financial performance of Nvidia. They're growing so fast that, you know, I don't know how many, we're going to get into figuring out how many H200s they sell, but they would need to sell a lot to actually move the needle on this behemoth of a business, what is the world's largest company in the world. President Trump said he would let Nvidia export its H200 chip to China and that the US would receive a 25% cut, his latest bid to make money for the government in an unusual agreement with a private company. I have informed President Xi Jinping of China that the United States will allow Nvidia to ship H200 products to approved customers in China

• 17:37John Coogan?

  and other countries under conditions that allow for strong national security. 25% will be paid to the US of A. The move is a boon for Nvidia, which has fought for months to maintain access to the world's second largest economy. The company had agreed earlier this year to give the US 15% of China's sales from a lower performing chip, only for the Chinese to scuttle those plans as part of continuing trade talks between the two sides. Chips from the world's most valuable company have become a prized geopolitical tool. The H200 has higher performance than the H20 that Nvidia was previously allowed to sell. Even with the US government taking a cut, the decision could be worth billions of dollars in sales to Nvidia. In the most recent fiscal quarter,

• 18:20John Coogan?

  Nvidia reported gross margins of 73.4% on $57 billion in sales. That is crazy. They can totally afford 25% for the big guy.

• 18:32Jordi Hays?

  Yeah, right around that time too, Lutnik was on CNBC, and this was the quote that originally ticked off the Chinese. He said, "We don't sell them our best stuff, not our second best stuff, not even our third best." He said, "You want to sell the Chinese enough that their developers get addicted to the American technology stack. That's the thinking." CCP basically immediately said, "We don't want any of them now."

• 18:54John Coogan?

  Trump said that the government would take a similar approach to exports from Nvidia competitor AMD, as well as Intel, in which the government now has 10% stake. We exported a ton of Teslas to China, and BYD and Huawei have now...

• 19:08Jordi Hays?

  But arguably completely leapfrogged.

• 19:11John Coogan?

  Completely leapfrogged. They did not become addicted to the American electric car stack.

• 19:16Jordi Hays?

  That was the point I was making earlier. You can make the art, like, almost with every single product, they've said, "We'll work with you to make this thing that you want to make. We're really good at making things." And then they ultimately just make a better version of said product and make it for cheaper. And in the case of cars, right now, we're obviously not allowing these cars to be imported into the US. You know, they can simultaneously say, "We're happy to keep making you these things. We're also going to compete with you directly."

• 19:47John Coogan?

  Yeah. And you don't allow Tesla to export the amazing Model S or Model 3. Does that slow down BYD's development of their car?

• 19:58Jordi Hays?

  My understanding is they were able to basically get a paid education making Teslas, and they were able to leverage that into making...

• 20:05John Coogan?

  But that's about making the car there.

• 20:07Jordi Hays?

  Nvidia has a Shanghai.

• 20:09John Coogan?

  But that's research. That's not made there. That's not made there. It's very different when you're when you're saying, okay, we're gonna go and we're gonna go and produce this product there. And like you are gonna get educated there and the workforce there.

• 20:21Jordi Hays?

  But you remember, we've gone through this before. China's like five year plans to create a domestic chip industry.

• 20:29John Coogan?

  They've been doing five year plans for 60 years.

• 20:31Jordi Hays?

  I know. They're building. That's what I'm saying. And I would argue that it's working. They're not caught up. But they're certainly made, you know, massive amount of progress. They've made more progress than any other country on earth.

• 20:40Speaker 02

  I think if you want to think about like getting the Chinese addicted to our chips, like how addictive are the chips?

• 20:45John Coogan?

  Yeah.

• 20:46Speaker 02

  Because if you can make a comparison between like you have Nvidia chips and then you have the Chinese or like TPU, right? Because the TPU is like in some ways, it's harder to use. The open source is not as good.

• 20:57John Coogan?

  Yep.

• 20:58Speaker 02

  But if it's just more economical, like if the actual hardware is just like a little bit cheaper.

• 21:02John Coogan?

  Yep.

• 21:03Speaker 02

  Then it doesn't really matter how worse the software is. People will eventually move to it.

• 21:06John Coogan?

  Hmm.

• 21:06Speaker 02

  So it's like the I don't think there is actually that much like soft power in the kind of general open source stuff like that. In regards to like Nvidia.

• 21:17John Coogan?

  Hmm.

• 21:17Speaker 02

  It doesn't seem very addictive outside of it just being cheaper.

• 21:20John Coogan?

  At the same time, like like we are, America is very much like addicted to Chinese solar panels right now. Like the Chinese solar panels come here, they're cheap. And so we don't wind up buying or building a domestic solar panel industry because just to get anything off the ground. You have to go in and say, okay, we're we're going to deal with having no margin forever. And no venture capitalist can underwrite it and no private equity firm can underwrite it. And so it just doesn't really happen.

• 21:50Jordi Hays?

  Gavin knew Gavin knew we needed a new narrative.

• 21:54John Coogan?

  Yep.

• 21:54Jordi Hays?

  He said after the be the fateful BG2 episode ended the AI trade.

• 21:59John Coogan?

  Yeah.

• 21:59Jordi Hays?

  We needed a new trade and now we're getting the space data center trade.

• 22:03John Coogan?

  Okay, let's hear the space data.

• 22:04Speaker 03

  Maybe the most important thing that's going to happen in the world in the next three to four years is data centers in space.

• 22:10John Coogan?

  Hmm.

• 22:11Speaker 03

  If you think about it from first principles, data centers should be in space. What are the fundamental inputs to running a data center? Their power? And they're cooling. And then there are the chips. The inputs to making the tokens come out of the magic machines.

• 22:25John Coogan?

  Yeah.

• 22:25Speaker 03

  So in space, you can keep a satellite in the sun 24 hours a day.

• 22:31John Coogan?

  Pretty cool.

• 22:31Speaker 03

  And the sun is 30% more intense. And this results in six times more irradiance in outer space than on planet Earth. So you're getting a lot of solar energy. Point number two, because you're in the sun 24 hours a day, you don't need a battery. This is a giant percentage of the cost. So the lowest cost energy available in our solar system is solar energy in space. Okay.

• 22:56Speaker 03

  Second, for cooling, in one of these racks, a majority of the mass and the weight is cooling. And the cooling in these data centers is incredibly complicated. You know, I mean, the HVAC, the CDUs, the liquid cooling. In space, cooling is free. You just put a radiator on the dark side of the satellite.

• 23:16John Coogan?

  It's fucking golf.

• 23:16Speaker 03

  And it's as close to absolute zero as you can get. So all that goes away. And that is a vast amount of cost. Where are you going to connect those racks? Well, it's funny, in the data center, the racks are over a certain distance, connected with fiber optics. And that just means a laser going through a cable. The only thing faster than a laser going through a fiber optic cable is a laser going through absolute vacuum. So if you can link these satellites in space together using lasers, you actually have a faster and more coherent network than in a data center on Earth. Okay. The user experience, you know, when I asked Grok about you and it gave the nice answer.

• 23:56John Coogan?

  This is crazy, though. They've done a podcast together five times. Why is he asking Grok about Patrick? I was like, what is going on?

• 24:05Jordi Hays?

  I would like to, I would like to know how much SpaceX exposure Gavin has. You just put a radiator on the dark side of the satellite. Thermal engineers in absolute shambles right now.

• 24:17John Coogan?

  Yeah, people are not, it's, I don't know, people are so split.

• 24:20Jordi Hays?

  Casey Hammer says, to be fair, this is a big satellite. You need basically a lot of mass in order to dissipate enough.

• 24:26John Coogan?

  Sure.

• 24:27Jordi Hays?

  Heat.

• 24:27John Coogan?

  There's some massive news from Gulfstream Aerospace. The G400 introduces next gen Gulfstream tech to its class. How has Mark Burns not been on the show yet? Here we go.

• 24:40John Coogan?

  Clearly don't have a no render policy over here. They're, they're render racing.

• 24:46Jordi Hays?

  You think they're just not at, you think they could just be adding special effects?

• 24:50John Coogan?

  What do you mean? This is the most rendered video I've ever seen. This looks like it was rendered in 2010.

• 24:58Jordi Hays?

  You think this is real, though?

• 24:59Speaker 04

  Bring Gulfstream performance standards to the large cabin class. Fulfilling our customers' needs for a product line to suit every trip and enhance every journey.

• 25:09John Coogan?

  You're like, this is real. This is what it looks like.

• 25:12Speaker 04

  With Gulfstream's signature combination of range, speed, and cabin comfort, the G400 will provide unrivaled efficiency. Thanks to the combination of the advanced Pratt-Wenney 800 series engine.

• 25:26John Coogan?

  This is gonna be a hot Christmas gift this year.

• 25:26Jordi Hays?

  Absolutely.

• 25:27John Coogan?

  People have been wondering. I think this will be top of, this will be under the tree for a lot of people. Mark Benioff says, "LLMs are the new disk drives. Commodity infrastructure you hot swap for whoever's cheapest plus best. The fantasy that the model is the moat just expired." Ah, Mark Benioff having fun on the timeline. I love that he's having fun. I love that he's, uh, he's taking shots.

• 25:51Jordi Hays?

  Don't they have an AI lab, to be clear?

• 25:54John Coogan?

  Uh, they were working on Einstein for a while, but I think that they, they are very much happy to be a rapper, happy to be a buyer of LLMs at this point. Everyone that knows anything knows this. OpenAI is the next Netscape, doomed and hemorrhaging cash. Microsoft is still trying to keep it afloat while keeping it off balance sheet and sucking out the IP. So why do they keep getting funded? The whole industry needs a $500 billion IPO ASAP.

• 26:20Jordi Hays?

  This post would go super hard if you don't understand the Microsoft-OpenAI relationship.

• 26:25John Coogan?

  The dynamics of the, of the, of the competition here, uh, feels like there will still be a lot of value. Even if it is somewhat commodity infrastructure, it's like, you know what else is commodity infrastructure? AWS, GCP, Azure. You get a, you know, and like a server with some hard disk on it. Like, that is commodity, and yet they all have 30% margins.

• 26:46Jordi Hays?

  Yeah, it's interesting, too. I mean, uh, Burry, uh, has, has, uh, you know, positioned himself of, of... Just hating any company that's overheated. Chat GPT having close to a billion weekly actives. And ultimately, even if they just compete in search, right? At least it's a trip, you know, multi-trillion dollar opportunity. Whether or not they, you know, fully execute against that is another thing.

• 27:10John Coogan?

  Hedge fund was ordered to pay a bonus to a trader who made 97% of its revenues. This is hilarious because when I read this at first, I thought it was he had made. He like his target bonus was, let's say, 10 million and he brought in 9.7 million. And they were like, you didn't, you didn't hit your bonus, buddy. You, you don't get the bonus at all. So I was like, oh, that sucks, but like, that's kind of the deal that kind of makes sense. But Evolution Capital Management has to pay him because.

• 27:39Jordi Hays?

  Yeah. So a hedge fund that was sued by a trader for refusing to pay a performance related bonus, despite him making 97% of its revenue, has been ordered to pay him 5.4 million plus interest by the High Court in London. When I read the headline of the story, I expected it to not be in the mid seven figures.

• 27:59John Coogan?

  Would you expect?

• 28:00Jordi Hays?

  I mean, I, I was hoping at least eight.

• 28:02John Coogan?

  Yeah, he's not getting a G400 off of this.

• 28:05Jordi Hays?

  Robert Gagliardi sued his former employer, Evolution Capital Management in London, alleging that it acted in bad faith by denying him a seven and a half million dollar discretionary bonus after he had generated more than 60 million for the firm.

• 28:19John Coogan?

  Wow, there are some harsh words here. Uh, Gagliardi, a block trading specialist alleged that he was told in early 2021 that a return of $10 million over the rest of the year would be an excellent result. When Gagliardi asked the fund's founder, Michael Lurch, for the payout in 2022, he responded, "I'm not going to pay you the bonus. F you sue me."

• 28:44Jordi Hays?

  So Gagliardi did, and he won.

• 28:46John Coogan?

  Saudi Arabia is loosening alcohol rules, letting non-Muslim foreign residents earning over $13,000, uh, you can buy alcohol.

• 28:55Jordi Hays?

  This is such a galaxy brained idea. It could only come from a mind totally disconnected from normal material reality. It is interesting. It's like, hey, if you want to do, you know, drugs, if you want to consume alcohol, that's fine, but you have to be putting up numbers. Cannabis should be like $10 million a year on your W2.

• 29:15John Coogan?

  I was about to say, but you know what happens then? Everyone in America, you know, you turn. Seventeen, eighteen, nineteen, you're not twenty-one yet, you get a fake ID to try and buy some booze, you're gonna need a fake W2 as well.

• 29:28John Coogan?

  Fake your income statement.

• 29:30Jordi Hays?

  You fake W2 to the corner liquor store, just being, and then just like looking through every line.

• 29:35John Coogan?

  In Saudi Arabia, so you're in Saudi Arabia, and let's say you're making a thousand dollars a year USD, or, you know, you're making ten thousand reals, you need to go and set up a circular contract where you're seventeen-year-old, somebody else is seventeen, I pay you ten thousand, you pay me ten thousand, and then we get our-

• 29:51Jordi Hays?

  Do that a couple of times.

• 29:52John Coogan?

  Exactly, we do that a couple of times, then we're earning enough to go buy alcohol, we can go get drunk together.

• 29:58Jordi Hays?

  That is crazy.

• 29:59John Coogan?

  That is truly galaxy-brained.

• 30:00Jordi Hays?

  Nazari says they got their hands on some North Korean cigarettes.

• 30:05John Coogan?

  They did?

• 30:05Jordi Hays?

  They got them in a DPRK, stayed on restaurant from a waitress who was from Pyongyang. Basically impossible to find any background info on them online, they taste and look a hundred percent. But I like the packaging, the packaging goes pretty hard, it feels, uh-

• 30:22John Coogan?

  Does, but I can't support it because I don't support North Korea.

• 30:27Jordi Hays?

  Thank you for being with us today, folks, we, we love you dearly, and we will see you tomorrow.

• 30:33John Coogan?

  See you tomorrow.

• 30:33Jordi Hays?

  Fantastic evening.

• 30:35John Coogan?

  Goodbye.