E172: SBF gets 25 years, Trump's meme stock, RFK Jr picks VP, Biden's 2025 budget & more

(0:00) Bestie Intros: Late night poker snacks! (2:33) SBF sentenced to 25 years (16:41) Trump's meme SPAC: modern trading card, protest vote, or something else? (34:59) RFK Jr. selects Nicole Shanahan as VP (47:46) Biden's budget plan for 2025: how to confront America's existential crisis? (1:11:59) Science Corner: Why the price of cocoa has skyrocketed! (1:16:41) Movie talk and wrap! Follow the besties: https://twitter.com/chamath https://twitter.com/Jason https://twitter.com/DavidSacks https://twitter.com/friedberg Follow on X: https://twitter.com/theallinpod Follow on Instagram: https://www.instagram.com/theallinpod Follow on TikTok: https://www.tiktok.com/@all_in_tok Follow on LinkedIn: https://www.linkedin.com/company/allinpod Intro Music Credit: https://rb.gy/tppkzl https://twitter.com/yung_spielburg Intro Video Credit: https://twitter.com/TheZachEffect Referenced in the show: https://www.reuters.com/technology/sam-bankman-fried-be-sentenced-multi-billion-dollar-ftx-fraud-2024-03-28 https://www.cnbc.com/2024/03/25/ftx-estate-sells-majority-stake-in-startup-anthropic-for-884-million.html https://coingeek.com/ftx-founder-sam-bankman-fried-sentenced-to-25-years-in-prison https://www.google.com/finance/quote/DJT:NASDAQ https://www.sec.gov/Archives/edgar/data/1849635/000119312524036093/d408563ds4a.htm https://www.sec.gov/news/press-release/2023-121 https://apnews.com/article/trump-media-gamestop-truth-social-meme-stock-666e62b4f3f788bd6276764056bc7c0d https://www.nytimes.com/2022/05/18/business/melvin-capital-gamestop-short.html https://www.reddit.com/r/wallstreetbets/comments/lau37c/we_can_stay_retarded_longer_than_you_can_stay https://www.wsj.com/politics/elections/rfk-jr-to-name-nicole-shanahan-as-running-mate-for-presidential-bid-4b9a698e https://twitter.com/CollinRugg/status/1773147897439436939 https://www.cnbc.com/2024/03/01/the-us-national-debt-is-rising-by-1-trillion-about-every-100-days.html https://www.reuters.com/world/us/bidens-2024-us-government-budget-is-also-campaign-pitch-2024-03-11 https://www.whitehouse.gov/wp-content/uploads/2024/03/budget_fy2025.pdf https://manhattan.institute/article/the-limits-of-taxing-the-rich https://www.brookings.edu/wp-content/uploads/2016/06/09_effects_income_tax_changes_economic_growth_gale_sawick.pdf https://fred.stlouisfed.org/series/FYFRGDA188S https://fred.stlouisfed.org/series/FYONGDA188S https://www.oecd.org/tax/revenue-statistics-united-states.pdf https://www.visualcapitalist.com/inflation-chart-tracks-price-changes-us-goods-services https://fred.stlouisfed.org/series/USGOVT https://www.blackrock.com/corporate/investor-relations/larry-fink-annual-chairmans-letter https://www.kakaoplattform.ch/about-cocoa/cocoa-facts-and-figures https://www.movieposters.com/products/daliland-mpw-138836 https://twitter.com/stillgray/status/1773234188663054751 https://twitter.com/elonmusk/status/1773240336292393144

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

• 0:00Jason Calacanis?

  Nat and I have goals when I play poker. She always leaves me with the following. Play well, check. Have fun, check. Do not eat late at night, never a check.

• 0:12Chamath Palihapitiya?

  Not a chance.

• 0:13David Friedberg?

  As soon as we finished dinner, within 20 minutes, back at the poker table, Chamath's like, may I have my Haagen Dazs now? May I have my second Haagen Dazs now? Helmut, you are buying the melts tonight.

• 0:25Jason Calacanis?

  Helmut, fire up the cheeseburger melt, don't you?

• 0:28Chamath Palihapitiya?

  Did you see, Friedberg, you should have seen last week, Helmut, at the dinner table, Sean made some like incredible, I thought, like fresh sorbet of some fruit or whatever. He at the dinner table ordered from DoorDash, double stuffed Oreos, some Nutter Butters, some jelly beans. They arrived when we left dinner and got back to the poker room. It was so disgusting. And then the next day, my whole household, everybody, Nat, the kids are like, what are these things? They were like, holding up these Nutter Butters. They were looking at them like, never seen another butter.

• 1:02Jason Calacanis?

  The best part about Phil Helmut's DoorDash addiction is that, like at least once a month, Chamath will be like, somebody ordered like four entrees, like pastas and two desserts to my house and I didn't order it. And it feels like, oh, that's me. On the group chat, that's me. Cause he doesn't take the time to change his address back to his house. And then you see the naked truth of what he's ordering.

• 1:47Jason Calacanis?

  One person who's not going to be eating well is SBF. He was just sentenced. Breaking news Thursdays continues here at the All In Podcast, episode 172. But SBF was just sentenced with me again today on the pod. Of course, the dictator, Chairman Chamath Palihapitiya, Sultan of Science, David Friedberg, and the Rain Man, yeah, David Sacks. I'm Jason Calacanis. Welcome back to the number one podcast in the world, episode 172 of the All In Podcast, your favorite.

• 2:20Jason Calacanis?

  SPF just sentenced 25 years.

• 2:23David Sacks?

  You're always overhyping.

• 2:25Jason Calacanis?

  Always hype man.

• 2:26David Friedberg?

  Over promise, under deliver.

• 2:27Jason Calacanis?

  Absolutely. I'm a hype man. I'm like favorite Flavor Flav of this organization. SPF, Sam Bankman Fried of FTX was found guilty, as you know, a couple of months ago in November, and he just got sentenced to 25 years. In total, FTX customers lost 8 billion, investors lost 1.7 billion, and lenders lost 1.3 billion.

• 2:51Chamath Palihapitiya?

  Jason, is that without parole?

• 2:54Chamath Palihapitiya?

  When is he eligible for parole?

• 2:57Jason Calacanis?

  That is a good question. Doesn't say what the parole could be. The prosecutors had.

• 3:02David Friedberg?

  There's no possibility of parole in federal criminal cases.

• 3:05Jason Calacanis?

  Yeah, so federal prosecutors saw it 40 to 50 years. So the judge went a little bit light, I guess, and gave half. In his sentencing, Judge Louis Kaplan said SPF had lied throughout the trial and showed no remorse. Quote, "He knew it was wrong. He knew it was criminal. He regrets that he made a very bad bet about the likelihood of getting caught, but he is not going to admit a thing, as is his right." In related news, FTX is also selling the majority of its stake in Anthropic for 884 million to Mubadala, the sovereign, one of the sovereign wealth funds from the UAE, and other investors, including Jane Street, where SPF worked for a hot minute, the Ford Foundation, Fidelity, and some other investors.

• 3:48Jason Calacanis?

  From CNBC, lawyers representing the bankruptcy estate told the judge in Delaware last month that they expect to fully repay customers and creditors with legitimate claims in the FTX case. That doesn't take into account equity holders. So it looks like that one investment could save a lot of people their deposits.

• 4:08David Friedberg?

  I saw an analysis recently that showed that they were going to be in a surplus. So investors were going to get money back and all the depositors were going to get their full 100% back.

• 4:18Jason Calacanis?

  Yeah, I don't know how much Bitcoin or other coins they owned, but if they didn't sell that Bitcoin at 30 or 40, and it's at 60 or 70 now, yeah, that would be material, right?

• 4:28David Sacks?

  The crazy thing is that SPF was not, it turns out, a terrible investor. He made a seed investment in Anthropic that's worth billions now. He made a seed investment in Solana that I think is worth billions now, especially now that Solana has recovered. I think that Solana was hard with the brush of being a Sam coin because SPF invested in it, but as it turns out. As far as we know, it's a completely legitimate developer project. Sam was an investor, but not a participant. And you look at the price of it, it's now rallied to something like an $80 billion market cap.

• 4:59David Friedberg?

  Yeah.

• 4:59David Sacks?

  The point being that a lot of the investments he made ended up being pretty good investments. And FTX itself, the trading platform, as far as we know, was a functional, workable business. I mean, it was a offshore crypto marketplace. So I don't want to necessarily use the word legitimate, but I think that it was, I think, as good as any of these trading platforms. So the crazy part of this is, I'd say, unlike the Madoff case, where from the beginning with Madoff, it was entirely a Ponzi scheme. There was nothing of value there. In this case, you had a, call it legitimate or semi-legitimate crypto

• 5:39David Sacks?

  platform combined with some legitimate angel investments. And so what I think went wrong here was Alameda, that Sam decided to siphon off customer deposits to gamble with his hedge fund, which was completely optional. He didn't need to do that. I mean, he already had a winning business and winning bets in his portfolio. So this whole Alameda thing, he didn't need to get into. And then, of course, siphoning off customer deposits to spray around for political donations to feel like you're a big shot was also really stupid. So this is the crazy thing, I think, about SBF is it was sort of like this manic, there was like a manic element to it. There was a messianic element to it. He wanted to take

• 6:23David Sacks?

  shortcuts. He wanted to believe he was going to save the world and then did all these criminal things in pursuit of that, that he didn't really need to in order to be successful. And that's why I think it's such a curious case, is it's not, it wasn't full Madoff in a way, because there were some legitimate elements to, to his portfolio.

• 6:43Jason Calacanis?

  You're right about the messianic thing. These guys were all drunk on this effective altruism concept that I think whatever crimes they committed by stealing the deposits and then going and investing them, they saw themselves as Robin Hood. We're going to take these deposits, we're going to make a ton of money, and then we're going to give it all away. Of course, they didn't have a CFO. Nobody did diligence on these investments. There were no controls in place. And he was literally stealing his customers' money to gamble.

• 7:09David Sacks?

  Right. And I think, I think actually, one, one quote that I saw reported from the judge was that if you steal customers' money, go to Vegas, gamble it,

• 7:20Jason Calacanis?

  Yes.

• 7:20David Sacks?

  you're still guilty even if you can pay them back with the winnings.

• 7:24Jason Calacanis?

  Yeah.

• 7:24David Sacks?

  But that suggests to me that actually, the, the FTX trustee is on a path to repaying the 11 billion of customer deposits that we're absconded with.

• 7:35David Friedberg?

  I just found it.

• 7:36David Sacks?

  I don't know if that's true or not.

• 7:37David Friedberg?

  It is true. In early February, the trustee said they now expect 100% payment back to the depositors and all the accounts. And all the excess will go to the shareholders in FTX, all the preferred holders that invested in the stock. I don't know what the total press stack was in FTX, but it sounds like there's going to be recovery there as well after all of the customer deposits are made whole.

• 7:58David Sacks?

  Wow. So this is my point, is he didn't need to do this. I mean, it was so insane. I mean, FTX, like I said, was a workable business. He made workable seed bets, but then he went crazy with Alameda and the, the Robinhood stuff. And so it's just such an interesting case.

• 8:17David Friedberg?

  By the way, Sax, Alameda is what he started with. So he, he started a firm that was meant to arbitrage crypto markets because there's all these different markets that didn't connect around the world. So the original concept was that he would set up a hedge fund like a Jane Street to arbitrage. And so he would arbitrage crypto pairs using different exchanges around the world. He set up all these different accounts and he would trade long one way, short the other way, and make a spread. And then he made so much money on the hedge fund. And he said, why don't we just do this all centrally? And that's how he started setting up FTX was it's his own cryptocurrency exchange. So like the legacy was that Alameda was there from the beginning. And the arbitrage across these illiquid, no transparency type markets was really the core driving principle when he started all this work.

• 9:02David Friedberg?

  The crypto exchange came later. And so it was like, he always had this orientation that he was trying to arb everything. And I think I told you guys this when I saw that video on YouTube right after he got arrested. And then they took it down off of YouTube. It was like an hour long video showing him trading and doing his day job in the office. It reminded me of like a mouse in a maze, like everything was like art, like he was finding little art he could make everywhere, nonstop.

• 9:27David Sacks?

  But they weren't great at it. They lost a ton of money.

• 9:29David Friedberg?

  And then they lost money.

• 9:30David Sacks?

  Yeah. And then he puts this dingbat in charge of Alameda, who proceeds to lose billions of dollars. I mean, the whole thing was so stupid.

• 9:40Jason Calacanis?

  I mean, it's gonna be such a great movie. I can't wait for the movie.

• 9:44David Sacks?

  I think one of the craziest parts of this is he had co-founders in FTX who weren't part of Alameda. And they just let him do this. Why would they do that? I mean, their own stakes in FTX minus Alameda could have been worth many millions of dollars, hundreds of millions of dollars, maybe billions of dollars.

• 10:04Jason Calacanis?

  I mean, the truth is, in business, you can do all kinds of criminal and crazy things until you get caught. And these folks were doing insane, crazy things. The system is based on trust. And people can break that trust. We saw it, remember with, um, what was Full Tale Poker? They were also taking the customer accounts and gambling those dollars. They literally mixed the operations budget and the customer deposits at Full Tale Poker.

• 10:31David Friedberg?

  I think part of the rationale, if I remember right, I read the Michael Lewis book on this.

• 10:38David Friedberg?

  And part of the rationale SBF gave to Michael Lewis was that Alameda was supposed to be a market maker, liquidity provider to the exchange. So they were playing an active role on the exchange of making trades available to create the market. And that was a key aspect of getting the market moving was that they had this well-capitalized market maker. And they knew how to actively trade on a platform and they just built their own platform. And then they were able to attract with more liquidity, more participants onto their exchange. And that was a key aspect of the business model.

• 11:09David Sacks?

  Yeah, but that could have kickstarted it, but like, you know, five minutes into it, you could probably turn that off. I mean, you know what I'm saying? Like, they didn't need to do that once you get to a certain point.

• 11:19Jason Calacanis?

  Also, these people were all on speed. So there's that.

• 11:23David Sacks?

  It contributed to the mania.

• 11:25Jason Calacanis?

  Yeah, I think like. They were hopped up on speed and they felt that they were gods and that, you know, stocks go up, coins go up, they can do anything they want, they can hang out with celebrities. It just got diluted and they were super entitled. I mean, this is a level of entitlement and criminal behavior that we rarely see. Doesn't matter if their tokens went up.

• 11:50Chamath Palihapitiya?

  When I had my one and only interaction with SBF, which was over Zoom, I asked for a model and this arrogant ding dong that worked for him, sent me like a five line Excel spreadsheet.

• 12:09Chamath Palihapitiya?

  And I thought, and I thought, this is the worst example of arrogance and hubris I've ever seen.

• 12:17David Sacks?

  I had one interaction with SBF.

• 12:19Jason Calacanis?

  Uh oh.

• 12:20David Sacks?

  Do you want to hear it?

• 12:21Jason Calacanis?

  Yeah.

• 12:22David Sacks?

  I got a little bit of a tiff with him. So it was at a tech conference. This is a few years ago. This is when he was absolutely at his like peak, like everybody wanted to talk to him. He was sort of holding court. He had a bunch of lackeys around him. And this is like a pretty exclusive tech conference. I'm not going to tar their name by mentioning them in this context. But so a friend of mine said, you want to go over and meet with SBF? And so I said, sure, whatever. So we go sit down and I started asking him about this ballot initiative that he was funding in California to raise our taxes to fund a pandemic prevention center. And as it later

• 13:01David Sacks?

  turned out that his brother was going to run this thing. And so I said to him, you don't even live in California. What are you doing funding a ballot initiative here in my state where I live? You live in the Bahamas or whatever, in order to fund this boondoggle, which by the way, is looking in the rearview mirror. We don't need it. Like COVID is over. And even if we did need a pandemic prevention center, the federal government should do it, not California taxpayers. And he starts getting very animated defenses thing. We sort of get into an argument. And so I kinda, you know, ended it by saying, well, listen, I'm gonna just let you know, like, I'm gonna publicly oppose this, you know, vigorously. And, uh, cause I, you know, I just wanted to let him know, like, I'm gonna call you out for this.

• 13:45Chamath Palihapitiya?

  Standing up for the little guy, David Sacks, coming, standing up for his state.

• 13:49David Sacks?

  So when I got back from that conference, I actually talked about it on this pod. I talked about that ballot initiative in California. And that was the origin story of that.

• 13:58Chamath Palihapitiya?

  They capitulated, right?

• 13:59David Sacks?

  That's right. Yeah. Like a month later, they dropped that thing because it was too much heat. But little did we know that they were enmeshed in all this criminality and they were absconding with all this money.

• 14:09Chamath Palihapitiya?

  What is Sam Bankman Fried's brother's name? Ben Bankman Fried?

• 14:15David Sacks?

  Was it like Gabe or something?

• 14:16Chamath Palihapitiya?

  Uh, Gabe. Nice.

• 14:18Jason Calacanis?

  I had one interaction with him at some, uh, at a annual general meeting, I got asked to interview him and it was like a private affair a couple of months before this all blew up. And he's dressed like a slob, you know, like literally doesn't look like he showered. Clothes don't fit. He's wearing flip flops and shorts. He's kinda like the schtick and he's a billionaire, blah, blah, blah. And I start talking to him and his leg is shaking like.

• 14:47Chamath Palihapitiya?

  Restless leg syndrome.

• 14:48Jason Calacanis?

  I mean, it, but no, it's, he's got his hand on it. He's like trying to control it.

• 14:52Chamath Palihapitiya?

  Did he have restless leg syndrome?

• 14:54Jason Calacanis?

  It's bouncing. I kid you not, like a hundred times a minute. It was disturbing. And so I'm wondering if this guy's got a panic attack or what's going on. And I kinda like toned down my crypto skepticism questions because I felt so bad for him that I thought he was having a panic attack. And then I realized this guy's hopped up on speed and he's got so much, uh, of Adderall or whatever. These, these kids were taking some patches that you wear to release and stuff. I am convinced that these guys were taking a level of speed.

• 15:25Chamath Palihapitiya?

  Unbelievable.

• 15:27Jason Calacanis?

  That would kill an elephant.

• 15:29Chamath Palihapitiya?

  Like Vietnam War level.

• 15:30Jason Calacanis?

  Yeah. Like these guys were out there. I mean, he was, I mean, patches, these guys were wearing patches and he was shaking.

• 15:38David Sacks?

  Was it like this?

• 15:39Jason Calacanis?

  No. Oh.

• 15:43Jason Calacanis?

  Did Hitler have?

• 15:45Chamath Palihapitiya?

  He was apparently.

• 15:45Jason Calacanis?

  Oh, right. Hitler was also on speed. That looks like he's on amphetamines there. Yeah. It did look like that, actually. But being honest, it was kind of almost exactly like that.

• 15:57Jason Calacanis?

  Oh my God, where is that? For people who don't know, the Third Reich was on speed. There's like many, many stories about this. Yes, Axe, that they were hopped up on.

• 16:08David Sacks?

  I believe so. I'm not sure.

• 16:09Jason Calacanis?

  Yeah.

• 16:10David Sacks?

  I believe so. I think entire books have been written about.

• 16:13Jason Calacanis?

  Yeah.

• 16:13David Sacks?

  Drug use by the Third Reich, but.

• 16:15Jason Calacanis?

  Yeah.

• 16:16David Sacks?

  I haven't delved into it.

• 16:18Jason Calacanis?

  Yeah, no, no, I've, I've, I listened to a couple of podcasts about it, in fact, and so it must be true.

• 16:26Jason Calacanis?

  I've listened to some podcasts. All right, moving on in the.

• 16:30David Sacks?

  If it was on MSNBC, it must be true.

• 16:32Jason Calacanis?

  Or Fox, or Fox, or if it was, uh, beep the great, your anonymous friend on Twitter must be true. All right, Trump just made $5 billion on paper with his memes back. Trump's social network has finally de-spacked. It's now publicly traded. You can go buy Donald Trump's back at DJT is the ticker symbol. They are on pace for a whopping $4.5 million in revenue on a $60 million loss. They're growing like three X year over year. And the company is not disclosing any user metrics. This quote from one of their recent filings is next. At this juncture in its development, TMTG, the Trump Media and Technology Group,

• 17:17Jason Calacanis?

  believes that adhering to traditional KPIs such as signups, average revenue per user, ad impressions and pricing or active user accounts, including monthly and daily active users could potentially divert its focus from strategic evaluation with respect to the progress and growth of its business. So they're not tracking.

• 17:37David Sacks?

  Isn't that the business?

• 17:39Jason Calacanis?

  I, it's so laughable, like I can barely get through it.

• 17:43David Sacks?

  That's crazy. They said that?

• 17:46Jason Calacanis?

  Literally, they said it. It's a quote from their SEC filing. According to similar web estimates, Truth Social had about five, five million visits last month. As of Thursday morning, it's worth about 8.5 billion. The same as Reddit or close to 2,000 times top line revenue. Company had about $300 million in cash after the merger. By comparison, Reddit has 800 million in revenue. Their market cap's 8.4 billion or about 10 times revenue. So it should be about five, six, seven times revenue would be more realistic, according to basic media comps. Reddit had 2 billion visits last month with 73 million daily active users. That's pretty significant. The SPAC took a long time to close.

• 18:29Jason Calacanis?

  There was an SEC investigation into three men allegedly making 23 million, buying then dumping shares of DWAC after the merger was announced. They all faced at least five fraud and conspiracy charges. Of course, this is what happened before it was de-SPAC. And so, what do you think, Chuma? Thoughts on this meme SPAC?

• 18:54David Sacks?

  So just to be clear, I just think we should be really clear because you're just floating this insider trading thing out there as part of the introduction, which is a huge allegation. And we have to be really clear that is related to a few investors and not to the company itself. And the company's SPAC was approved by the SEC. So I just think we have to be clear about that.

• 19:15Jason Calacanis?

  Here's the SEC chart. Yeah, just to be super clear, SEC charges former DWAC board member and others for insider trading DWAC.

• 19:24David Sacks?

  I just don't think this is the story. This is just not the story.

• 19:27Jason Calacanis?

  This is the reason it was delayed. So just to be clear, this holding's been delayed for a couple of years because of this.

• 19:32David Sacks?

  Okay, fine. So it was delayed. The SEC approved it. The company is now trading.

• 19:37Jason Calacanis?

  Yeah. What do you think of the valuation?

• 19:39David Sacks?

  And that's the real topic, isn't it?

• 19:41Chamath Palihapitiya?

  Here's what I'll say. I think that this is a really important watershed moment, and it reminds me of 1997. Nick, throw this little image up. In 1997, David Bowie issued what was then famously called the Bowie Bond. It was $55 million that yielded 7.5%, which is about 80 bips above the 10-year at the time. These were 10-year bonds.

• 20:07David Friedberg?

  That's awesome. I didn't know that.

• 20:08Chamath Palihapitiya?

  The bond payments were linked to 20 albums that Bowie had released before 1990. And so, these are like 280 songs. And what he basically said was like, listen, folks, you're essentially buying a piece of me, and in this case, my past work, and I'm going to take this $55 million upfront, and you're going to get paid this interest based on the royalties that I generate off that historic library for a 10-year period. We think you're going to get paid the 55 million plus the 7.5% a year, and then I'm going to take back the rights. And if I default, if these bonds default, you will own the songs. And it turned out that it was an incredible bet.

• 20:50Chamath Palihapitiya?

  The people that bought it, I think it was Prudential, which was an insurance, I think it's an insurance company. They got paid, the bonds did not default. In 2007, Bowie took back

• 21:01Chamath Palihapitiya?

  the ownership of that catalog, of that back catalog. But instead, what he had was 55 million upfront, which allowed him to go and buy all kinds of other parts of his catalog that he didn't otherwise own. So why is this interesting? This was the first example, I think, of people monetizing themselves, their name and their likeness. In this case, it was done via debt. I actually think when you look today, what's happening is a more sophisticated version of that movement, but at much larger scale. I mean, we were all joking that there was a bunch of meme coins that launched, not with any of our support, by the way, but you know, with our names, with all these other quasi-famous people's names, those things went up and were worth millions of dollars of value.

• 21:48Chamath Palihapitiya?

  And I think what this Donald J. Trump, the DJT company, what it represents, is effectively a trading coin, a baseball card, if you will, a trading card via a stock on the value of Donald Trump's enterprise value. His name, his recognition and his likeness. So this, I think, is the modern instantiation of the Bowie bond. And what's incredible is you can see Bowie, 30 or 40 years ago, he could have generated 55 million dollars in inflation-adjusted dollars. That's about 100 billion in today's dollars. Trump, three and a half, four billion. I think it sits on top of this idea

• 22:27Chamath Palihapitiya?

  that these very famous people, the Kim Kardashians of the world, the Donald Trumps of the world, the Mr. Beasts of the world, can eventually take companies public. And when you take a company public, you have to remember, Jason, there's the revenue and the profits, right? But if you look at the balance sheet of a company, there is always a line item called goodwill. And goodwill is what people use to separate the assets and the liabilities and whatever is left over to generate the shareholder equity. So in this case, Donald Trump, the DJT company's balance sheet will show a ginormous entry in goodwill. And that is the value of his name. Coca-Cola has such a goodwill line item.

• 23:08Chamath Palihapitiya?

  PepsiCo does, Gatorade does, Nike does, and this company does. And I think there's going to be a lot of other companies that will go public that effectively generate a huge goodwill line item that represents the name brand value of the person associated with it.

• 23:25Jason Calacanis?

  So you're a buyer?

• 23:26Chamath Palihapitiya?

  I'm not saying that, I'm just saying that there is a lot of people that will be buyers that essentially will buy this as a Donald Trump, a directional bet on the value of his brand. And I'm also predicting that many other individuals will go public and have enterprise values that are levered in the same way as DJT. And that is a modern version of the boy bond from 97.

• 23:51Jason Calacanis?

  Friedberg, your thoughts on the Trumatt's argument that this is a proxy for the value of Donald J. Trump's brand?

• 23:59David Friedberg?

  I think that's certainly one reason why people are buying the stock and driving the price up. And another one is probably a vote against traditional media. That there is a contingent of folks who are basically voting with their dollars and saying, we want an alternative to traditional media and traditional publishing platforms that have censorship that we don't agree with, or have editorialization that we don't agree with. And that this investment, I think, represents a way for them to vote and say, I don't want the old way, I want a new way. And while this may or may not be the new way that succeeds, it may or may not be a great business, and it may or may not even have much viewership or usefulness.

• 24:42David Friedberg?

  It's a mechanism by which people can put some money down and say, I'm voting on an alternative, I want to see an alternative. So I do think that there's a flashpoint indication that arises from this, that's more than just the memeing aspect of it, which is certainly fun. Everyone crowds into a stock, stock price goes up, it's kind of like to the moon and so on. I think there's also this element of demand for alternative media. There's demand for a different type of publishing platform. And so I think that that's what this most represents to me from a, what the market is telling us perspective.

• 25:17David Sacks?

  I think there's one other thing going on here, which is that this represents a populist reaction to the lawfare against Donald Trump. That I think Trump supporters want to support him against all of these lawsuits and this persecution that he's been facing. And I think one proof of this is if you turn the dial over to MSNBC, they've been losing their minds all week over this because they thought they had finally gotten the man. There was this $450 million judgment in New York that he was fined for supposedly inflating the value of assets against which he got loans, even though the bank did its

• 25:58David Sacks?

  own independent appraisal of the properties and even though the banks fully got paid back and said they wanted to keep doing business with him. So they thought they had finally gotten DJT, and he was gonna have to pay hundreds of millions of dollars in fines. And then, lo and behold, the SPAC comes along and he makes millions and millions of dollars. Now, that's not locked in yet. We're still in this lockup period where for six months, there's a very small float, and it's probably the case that, once there's more shares on a liquid market, we'll find out what the real valuation is. So let's call the valuation we're seeing today, based on a very small float, let's call this more of a preliminary number, and Trump can't sell yet. But presumably,

• 26:39David Sacks?

  after six months, when the lockup comes off, he'll be able to sell. So, look, I think fundamentally, what's going on here is this is political. Trump's enemies are angry about this SPAC, because they see that it gives him a lifeline. And I think Trump supporters are deliberately buying this stock to support their guy. And to say that this lawfare against Trump that basically seeks to imprison the man or bankrupt the man instead of simply run against him, is a new low in American political discourse. And I think there's millions of people who agree with that, and some of them are willing to buy this stock as a protest vote.

• 27:14Jason Calacanis?

  I agree 100% with the protest vote. It's, you know, he had, what, 60, 70 million people vote for him? He got 74%, 74 million, rather, 46.8% to Biden's 81 million. If but 2% of those people want to buy the stock, it's a million and a half people. And that's exactly what's happening here. They don't care if they lose the money. Actual value of this company with 5 million in revenue, 4 million in yearly revenue. I mean, if you really want it to be absolutely insane and give it 100x valuation, it's worth 400 million. And so then if whatever goodwill Donald Trump's likeness is, maybe that's another 500 million.

• 27:55Jason Calacanis?

  But you'll lose a large amount of money, I predict, if you buy this. And if you're buying it as a protest vote, sure, go for it.

• 28:01David Sacks?

  Why don't you, J Cal, why don't you short it as a J trade?

• 28:04Jason Calacanis?

  You know, I've never shorted a stock and I, I think-

• 28:07David Sacks?

  Remember Gabe Plotkin?

• 28:10Jason Calacanis?

  No, who's this?

• 28:11David Sacks?

  Oh, remember from Melvin Capital? He thought he could- Who blew up his fund shorting GameStop. He thought he could outsmart all the apes.

• 28:18Jason Calacanis?

  Yeah, that's, I mean, that's exactly why I wouldn't do it. I've never shorted. I think that, you know, you get these Trump voters and it starts going up because of the small float, which is what's happening now. They might send this thing to $80 billion, you know? Who knows what is possible with the short float and a motivated, you know, million, 2 million people.

• 28:37Chamath Palihapitiya?

  You guys are bringing up something else as well, which is we've shifted from fundamental-based stock trading being the overwhelming driver to there's a lot of like very speculative day-over-day activity that you can't control anymore. And I think it's part and parcel of what's happening in other markets in America as well. So when you look at sort of like what happened in 2016, when the Supreme Court said each state can regulate sports gambling?

• 29:06Chamath Palihapitiya?

  All forms of like online gamesmanship and betting just started to skyrocket. It could be casinos, lotteries, sports betting, it didn't matter, but everything just caught a massive ginormous bid. And when you look at the products that service the retail market, they've also become increasingly gamified. Robinhood is probably the best example of having built an incredibly good business by making things more like a game. And then recently adding fuel to the fire are things like zero day options, which are just like, and there was a big article in the Wall Street Journal where like one of the reporters, she became addicted to it. And like the Wall Street Journal gave her, I want to say like, like a few thousand bucks, but she had to disgorges the profits.

• 29:49Chamath Palihapitiya?

  And she like 2000, she got like a 2000% return or something. Specking zero day options via Robinhood. So the point is that on top of the whole

• 30:03Chamath Palihapitiya?

  movement to sort of allow individuals to monetize their own name and likeness via the stock market, which we just talked about. The second movement is that a lot of these things are becoming less financialized and more gamified. And so you just have many more participants. And so to your point, you can have a GameStop moment in any of these things. You can have these zero day options run the stock to the moon. I would be, I would tread very lightly here.

• 30:29Jason Calacanis?

  Yeah. And just another warning, you know, the, the stock market bases things ultimately on like earnings and profits. And so when we look at this as a proxy and Mr. Beast would have the same issue or Martha Stewart, you have a key man, key individual risk here, i.e. this person goes to jail, they die, whatever, which Martha Stewart always had on her businesses. And then what is included in this is key. So when, if he does another TV show, And it becomes a hit again. Is that included in this? No. If he has another building or his buildings included in this? No. The golf course is included is no. What's including in this? Included in this deal when you buy DJT is apparently just a really

• 31:15Chamath Palihapitiya?

  No, you're right.

• 31:15Jason Calacanis?

  crazy.

• 31:18Jason Calacanis?

  You know, social network that nobody uses. So just be clear what you're buying.

• 31:22Chamath Palihapitiya?

  No, you're right. The the more sophisticated version of this trading card analogy would be if Donald Trump contributed his brand licensing revenue in perpetuity to the asset. And then it really is a longitudinal forward bet on the Trump name.

• 31:41Jason Calacanis?

  Yeah.

• 31:41Chamath Palihapitiya?

  And that that's sort of more like if Virgin, like if Richard Branson took the Virgin Holdco public.

• 31:48Jason Calacanis?

  Yes.

• 31:48Chamath Palihapitiya?

  That's effectively what that is as well. Like, you know, Branson over 40 or 50 years has built an incredible business. I think the stat that I heard when I got to know him was he's created 20 businesses worth at least a billion dollars or more. Over his lifetime.

• 32:05Jason Calacanis?

  With the Virgin brand.

• 32:06Chamath Palihapitiya?

  With the Virgin brand. And the Virgin brand is a licensing model where he holds that right and he will license it to you for a share of the revenue. That's independent of anything else that he may do with these businesses. And so if he took that Virgin Holdco public, then what you're buying is a longitudinal discounted cash flow on the value of Virgin. And to your point, if Trump contributed that name and likeness licensing capability into this, by the way, he could also still do that. So to the extent that this business saw a contraction and maybe the Truth Social thing didn't end up being that valuable, but the other aspects of the media business he could create by basically saying, okay, look, this will get a share of my licensing revenue for my name would effectively be a

• 32:48Chamath Palihapitiya?

  proxy to do that. So he's got a lot of outs here to maintain this. Market value and then on top of that, to your point, there's 70 million odd people who would want to support him in one way, shape or form.

• 33:00Jason Calacanis?

  I would not go anywhere near shorting it, given his, uh, his fan base is incredibly likely to keep buying these shares. And if you want to know the actual value of this business today, I'm an expert at this. It's a hundred million dollars. It's $200 million. It's not anywhere close to this.

• 33:18David Sacks?

  Put your money where your mouth is.

• 33:19Jason Calacanis?

  We just, no, no, we just explained, when you have a small float like this and a rabid group of people who are gambling, you will get your face ripped off. This absolute stupidness. What's that?

• 33:29David Sacks?

  You'll get plonked.

• 33:32Jason Calacanis?

  Yeah. I mean, it's, it's disastrous. I mean, they, what did they say? We can be stupid longer than-

• 33:37David Sacks?

  We can be retarded longer than you can be solvent.

• 33:41David Sacks?

  The rhetoric-

• 33:42Jason Calacanis?

  It is such a great line. I mean, but you can gamble like this on stocks, yet you cannot invest in private companies. I don't get the legal system in America. Be careful out there, folks. You will lose a large portion of money is my prediction if you buy the stock. But feel free if you want to gamble.

• 34:01David Sacks?

  Look, I think, I think this is all part of the ongoing backlash to lawfare.

• 34:05Jason Calacanis?

  Yeah.

• 34:06David Sacks?

  Joe Biden instructed his Justice Department to prosecute Trump. It's, in my view, it's utterly unprecedented in American history for one president to try and prosecute, imprison and bankrupt his main opponent in the political election. And there are millions of Americans who are absolutely disgusted by this. I think it's a new low in American politics and God bless all the people buying these shares to support Trump. Just as a protest vote, I don't know whether they're going to make money or lose money. Like I said, I don't think you can justify the valuation based on fundamentals, but you can sure as hell justify it based on payback.

• 34:40Jason Calacanis?

  Yeah. I mean, if you want to give your money to a billionaire, buy the stock. Absolutely.

• 34:45Jason Calacanis?

  Feel free. I think prob- I agree with you like maybe two of the six lawsuits are a bit weak. I think the three or four other ones, you know, he committed the crimes and he's just paying the price. But, you know, we can agree to disagree on this pod. Intelligent people do. Speaking of intelligent people, RFK Jr. just picked up his running mate. This is a little bit crazy and I'm really interested in hearing your thoughts on it. He chose a 38-year-old Bay Area lawyer, Nicole Shanahan, as his VP. RFK explained why he chose her. She knows big tech very well, how they use AI to exploit the public, how they censor and surveil Americans, push certain agendas. She understands the health consequences of toxins in our air, soil, and food. And he wanted a younger person

• 35:30Jason Calacanis?

  to represent millennials and Gen Z. He says younger generations feel like nobody represents them in Washington. He also wanted an athlete in good shape to inspire Americans to live healthier lives. And Shanahan donated $4 million in support of RFK Jr.'s Super Bowl ad that ran earlier this year. Sax, what do you think of this pick?

• 35:55David Sacks?

  Well, this pick does not excite me. I'll be frank. But since I'm going to say something critical, I want to maybe start by saying something positive because I really, you know, I love Bobby Kennedy. I mean, I think that he represents a number of really great issues that I agree with. I mean, first of all, he's been the most articulate critic of the Ukraine war, understands it deeply, and has explained it extremely well. He stood up for sealing the border. He went down there, showed that it's out of control. Completely agree. He was a vocal critic of Fauci and lockdowns, was completely right about COVID. He supports civil liberties and free speech. So, you know, I want to say like Bobby Kennedy's great.

• 36:40David Sacks?

  The issue I have with this pick is that she doesn't represent any of those issues. She has a completely different issue matrix. And I watched her speech. And just to say something positive about her, I mean, I like her enthusiasm. I think she's 38 and it's nice to have someone running for political office who's not in their 70s or 80s. And I think she's genuine. I actually think she's saying what she really believes. And that's really nice and refreshing. But again, if you go back to the issues themselves, she brought up three issues. Number one is she says she wants to make Americans healthy again. It's the focus on chronic disease. I'm not saying she's wrong about that. That's just not my issue. Number two, she brought up criminal justice reform. This one concerns me.

• 37:23David Sacks?

  Apparently she donated to Gascon, who's a Soros DA, who helped destroy San Francisco and then failed upward to LA. So apparently she's a Gascon supporter. That does not fill me with confidence. That is a, quite frankly, luxury liberal belief in this decarceration idea. So I'm not excited about that. Her third issue was climate and environment related, but in a very specific way, she went after big agriculture. She said, "We can no longer support extractive corporate agriculture." I'm gonna let Friedberg speak to that one. I can't really say whether she's right or wrong, but that's not one of my issues.

• 38:01David Sacks?

  So, listen, at the end of the day, I feel like this pick accentuates and underlines the issues in Bobby's platform that appeal to the left, frankly, to liberals. And I, look, I think Bobby's candidacy is a complex candidacy that brings together people from both left and right. But again, this pick does not speak to me. It speaks to the more liberal parts of his coalition.

• 38:30Jason Calacanis?

  Does it increase his chances? And who would have been the person who would have increased his chances most?

• 38:36David Sacks?

  Well, the person who would have been amazing would have been Tulsi Gabbard. Okay? If he had chosen Tulsi, that would have blown the doors off.

• 38:46Jason Calacanis?

  Slammed on. Yeah, I mean, and Tulsi's been saying, Chamath, publicly, that she would be proud to serve with Trump and seeming likely that she's got a shot at that, yeah? Being the VP for Trump?

• 38:59Chamath Palihapitiya?

  I'm not gonna comment on that.

• 39:01Jason Calacanis?

  Okay.

• 39:02Chamath Palihapitiya?

  Let me just say something else. I think Tulsi Gabbard is really...

• 39:07Chamath Palihapitiya?

  Impressive. I think she's independent and I think she really stands firmly on her own two feet in a way that I find inspiring. I, like Sacks, have many, many positive thoughts about Bobby Kennedy. I think he is, he was really a breath of fresh air, Jason, this, in this election cycle, because he was able to say the unsayable things and made those things more easy to be said by others. And I think that there's a really important role in that, and I think he deserves a lot of credit for that. And then the fact that he said things that were so unconventional and not mainstream that are now mainstream views,

• 39:51Chamath Palihapitiya?

  I think says a lot to the fact that he was pretty grounded in first principles thinking on those topics. And I think that having those kinds of people in office are really good for America. All of that said, I do agree with David that I think the pick was meant to be more about covering his left flank. And I found that an odd calculation. And I wonder whether it wouldn't have been easier to cover the right flank. And there are different folks that are, that could have been in the mix to do that. And so I think that it was a calculation, though. And I think it's about, he has a core set

• 40:34Chamath Palihapitiya?

  of issues. It's about whether he appeals more to this side or to this side in order to get the totality of the votes that he think is possible. Second, he was under a little bit of a time constraint, because some of these states need the VP candidate named, and he's under a shot clock that the other two are not. So, I mean, I wish Bobby the best, because I think some combination of Bobby doing well,

• 41:02Chamath Palihapitiya?

  And some upheaval between the Democrats and the Republicans is really the only chance we have of having a credible third party. Well, let's see now what happens. By the way, we should just say like, you know, Joe Lieberman passed away, which is really unfortunate. You know, he was a really independent thinker as well. Let's see what No Labels really does here. There's a little bit of chaos over at No Labels, I think. But so there's a lot of moving parts. So it was clearly calculus. I don't totally understand what that formula was, though.

• 41:34David Sacks?

  Just to build on what Smack Jemoss said, there's a report by Colin Rugg that the DNC realizes what Jemoss said about this covering Bobby's left flank rather than his right flank. And apparently they're in somewhat of a panic about this. And I think what you're going to see is that lawyers from the DNC and the Biden campaign are going to fight tooth and nail to keep this ticket off the ballot, at least in the major contested states, like the five or six states where the presidency will be decided in 2024. And of course, they'll be saying they're doing this to save democracy. But you're going to see, I think, a full court press by DNC lawyers to keep the Kennedy Shanahan ticket off the ballot.

• 42:17Jason Calacanis?

  Yeah, this seems really like it's going to damage Biden, which was my original prediction. And that reason why a lot of the right wing were supporting RFK was because they wanted, they saw this as a clear path to take away a couple of points from Biden.

• 42:30Chamath Palihapitiya?

  I think the first part of what you said, first part of what you said is 100% right. I'm not sure that a bunch of Republicans are going to get organized, Jay Cal, to vote for RFK in that way.

• 42:43Jason Calacanis?

  Oh, no, I don't think they're going to do that. I think they supported him publicly in order to build him up as his centrist candidate, knowing that it would take away from Biden. So I just think on a strategic political basis, all these Republicans will

• 42:56David Sacks?

  They didn't do that for for Marianne Williamson. Why not?

• 42:59Jason Calacanis?

  Yeah, no, she's not electable. Yeah, no, no, it's because she's not electable. I mean, she's like, not like a viable candidate. It's pretty clear she's not viable.

• 43:07David Sacks?

  Why can't you just accept that people on the right like the issues that Bobby spoke to? Isn't that the simple explanation?

• 43:14Jason Calacanis?

  Because I think that they're partisans and they just want to win. So I don't think it has anything to do with what you were saying, which would be like authentically liking and connecting with what he's saying. I don't think it was that. I think it's a strategic plan to try to pull Biden votes. And I think Republicans are smart for doing that.

• 43:27David Sacks?

  You think Bobby's a plant? You think he's a plant?

• 43:29Jason Calacanis?

  I think their support for him is for nefarious reasons. They're supporting him to take votes away from Biden. And here it is. We're all agreeing that this is going to take votes away from Biden. So I think it's a very clever strategy on the GOP's part.

• 43:41David Sacks?

  Hold on, just to add one point to that. Remember that when Bobby entered the race, he did so as a Democrat. He did so challenging Joe Biden for the nomination of the Democratic Party. How did the Democratic Party react? They kept him off the ballot. They wouldn't give him a fair shot.

• 43:54Jason Calacanis?

  Yep.

• 43:55David Sacks?

  That's why he went independent. So he did not have to be this, you know, sort of like what you're kind of implying like a fly in the ointment type third party candidate. He tried to be the Democratic candidate.

• 44:05Jason Calacanis?

  Yeah.

• 44:06David Sacks?

  They wouldn't let him compete. If they had let him compete in a fair way, maybe he would have stayed a Democrat.

• 44:10Jason Calacanis?

  I would have loved to have a massive competitive field of Democrats. I think the Democrats are screwing this up big time. I think this could be the most, this could, I think they could peel off a couple of percentage points. Yeah. In those states.

• 44:24Chamath Palihapitiya?

  More, I think you're right. I think it's more than that. So, I mean, I think it's more than that.

• 44:28Jason Calacanis?

  So we all agree that's what's happening here. Then we're just disagreeing on tactics.

• 44:32David Sacks?

  I think this is where.

• 44:33Jason Calacanis?

  We agree it's taking points away.

• 44:34David Sacks?

  Yeah. I think we agree about that. But what I'm saying is that this is where we've ended up. I don't think it was constructed to be this way.

• 44:42Jason Calacanis?

  Ah, interesting. Friedberg, your thoughts on this candidate specifically around her love of organic food and wanting to take on the pesticides, toxic food, you know, and the industrial food complex.

• 44:59David Friedberg?

  I remain steadfast in my commitment to there being only one major issue facing this country, and that is the federal debt and the deficit. We are increasing the federal debt by a trillion dollars every hundred days. That number is not slowing down. The current budget proposal from the Biden administration calls for over 7.2 trillion dollars to be spent next year. That makes the US federal government roughly one third of our country's GDP. The outrageousness of the condition that the US is in right now makes it so insane to me that we are talking about any other topic like. Big agriculture or whatever other nonsense was being spattered about as important topics

• 45:43David Friedberg?

  to this particular person. If every voting citizen of the United States does not recognize the severity of the deficit and debt problem that the federal government faces, you are wasting your vote. And no candidate is speaking to what is clearly the biggest issue of our time, and we need to address this issue headlong. So I don't care about this person or anyone else who's running for office that is talking about stuff that we cannot actually address and problems we cannot actually solve if we don't get our fiscal affairs in order. That's my point of view.

• 46:12Jason Calacanis?

  Got it. And respect for that. Can anybody win the presidency on a, hey, we're going to balance the budget, we're going to cut spending platform?

• 46:22David Friedberg?

  Nope.

• 46:23Jason Calacanis?

  So they can't win, and it's an existential issue?

• 46:27David Friedberg?

  That's why, I look, I mean, I'll keep shouting it to the abyss, I hope that a few people hear it, and that at some point it becomes a topic that folks do begin to focus on. I think that the necessity of raising tax rates, the necessity ultimately of cutting entitlement programs, the necessary inflation that will arise because of the condition of the federal government's debt level, because we're going to have to keep printing money. These are the sorts of things that are like a boiling pot, that one day folks will wake up and say, well, what the heck happened? Everything got mismanaged. And it's not a Democrat problem, it's not a Republican problem.

• 47:09David Friedberg?

  It's a fundamental problem of people voting themselves all the money, and people getting voted into office by saying, I'm going to do more than is being done today, and that costs money. And no one actually addresses the rampant misuse of funds, the lack of accountability in spending, and the fact that we have an incredible amount of negative ROI spending, and the fact that we've effectively created an economy that's fundamentally dependent on federal spending. And I'll go through some statistics when we talk about Biden's budget later in the show, but I think that the significance... Is just overlooked by all of these candidates and we're not really talking about the thing that matters. So.

• 47:46Jason Calacanis?

  All right, so let's break down Biden's proposed budget of 2025. Proposed budget was 7.3 trillion for fiscal 2025. That starts in October of 2024. It's up 18% from 2023. Projected deficit 1.78 trillion, which is similar to the deficits we ran in 23 and 24. The budget projects an average deficit of 1.6 trillion per year over the next decade. National debt, as Friedberg was alluding to, is insane. It's at 34.5 trillion. But we made some charts here to go through all of this. So let's pull up the first chart. And this is comparing Biden's proposed budget in 2025 with budgets from 2005 and 2015.

• 48:30Jason Calacanis?

  Defense spending has actually grown pretty modestly during that time, but entitlements, interest payments and non-defense spending have jumped significantly. U.S. will owe 965 billion in interest on its debt next year. That's 65 billion more than the proposed defense budget. And in 2026, the U.S. will surpass 1 trillion on interest owed on its debt. And we'll talk about that more in a minute, but let's start here with this first chart. Anything jump out to you, Chamath, here? That's notable and worth discussing.

• 49:02Chamath Palihapitiya?

  All the areas that we need to cut, we can't even have a conversation about. So they'll never get cut and they'll keep growing.

• 49:10Chamath Palihapitiya?

  So I think that we probably need to figure out what the alternatives are. So if you can't have a conversation about expenses, the only logical place is to have a conversation about revenues and what that means for the government is in taxation.

• 49:31Chamath Palihapitiya?

  And so I don't know, Jason, what we do here. There could be a couple of saving graces. So there are some things happening, for example, on the Medicare side that could be profoundly disruptive. They are now, I'm not, again, I'm just going to put this out there as it's happening. I don't know if it's good or bad, but they are looking at reimbursing things like Wegovy and Ozempic and whatnot. If you look at the underlying costs of those kinds of chronic diseases, diabetes, heart disease, et cetera.

• 50:05Chamath Palihapitiya?

  And you put a large swath of the American population on those drugs, the reimbursement value of those drugs versus the cost of actually the chronic care management would save you many hundreds of billions of dollars a year. So that's something. Second is on the defense side, there's a large portion of that budget that's migrating away from traditional tactical warfare to things that are unmanned vehicles and cyber and whatnot. That could save 200 or 300 billion dollars there. So there are places where you could save 500 billion to a trillion dollars.

• 50:37Chamath Palihapitiya?

  But I think it's going to be a almost impossible conversation and it'll happen by accident. So then the only forced conversation that I think we are going to have as a society is around taxation. And that's really bad for, you know, a lot of people that don't believe that's the path to generating growth.

• 50:56David Friedberg?

  One of the challenges is that there are, and we should reference these in the show notes, Nick, but there are well researched economic studies that show that when a government tries to increase the taxation level north of 20% of GDP of that economy, that you actually see GDP growth go negative. That there's a certain natural equilibrium on which you can tax the system. Beyond that level, investment dollars go down and growth begins to shrink. And that's what triggers the spiraling problem because then the government spending needs to go up to continue to grow and support growth in the economy. And it creates this inevitable spiraling.

• 51:35Chamath Palihapitiya?

  Would you call this the Atlas Shrug? The Atlas Shrug effect is investment goes down?

• 51:39David Sacks?

  There's a Fred chart showing percent of GDP that's federal tax receipts and then percent of GDP that's spending. And then the gap is your deficit. Okay. And Friedberg's right that I think in the absolute best economy or best years of the best economy, so it's like, you know, the best year of the Reagan boom and the best year of the Clinton boom, when we had the government surplus. I think the government was extracting just shy of 20% of GDP. And in the seventies, when marginal tax rates were at 70%, so before the Reagan tax cuts, we were actually extracting a lower percentage of GDP. So there's only so much blood you can get from a stone.

• 52:23David Sacks?

  If you raise tax rates on a marginal basis high enough, the economy performs worse and you actually end up collecting less. Or people spend a lot more money on lawyers and accountants to basically figure out more structuring schemes to avoid paying taxes. So the years in which we've got the highest percentage of revenue out of the economy are in good economic years where we've had reasonable levels of taxation as opposed to the highest levels of taxation. And so the problem is with the spending. I mean, we used to be able to keep spending to somewhere between, I'd say in the best years of, the years of the Clinton surplus, I think spending as a percent of GDP was like

• 53:06David Sacks?

  18.8%. It's around 20% of GDP goes to federal spending. That was normal. But then the spending got out of control during COVID and it went up to like 25, 30% of GDP went to federal spending. It's starting to come down, but it's still way too big a number. Anyway, my point is that a starting point for dealing with next year's budget is free spending, just free spending. You know, the 18% increase is not a good idea. If we want to get this problem under control, freeze the spending, we can talk about taxation, but you're only going to get so much blood from a stone.

• 53:43David Friedberg?

  And increased spending is stimulatory and so it works well in an election year. I would say we took two major crises and we had crisis level spending and then we normalized that spending and allowed it to carry forward, starting with the 08 financial crisis with our monetary policy and then being accelerated with COVID and our fiscal policy. I'll give you guys, I did some back of the envelope math. I'm sure there are economists who have done a better job of this than I. There are directly 3 million Americans that are directly employed by the federal government. There's 167 million workers in the US, so 3 million are directly employed by the federal government. If you take the rest of the federal spending that flows into the economy, it's about 3.5 trillion a year.

• 54:26David Friedberg?

  And assume 30% of that capital goes to equity holders in businesses that own businesses that benefit from that spending and the rest flows through to labor. That's about 13% of GDP flowing through to labor. And assuming average annual income, that's another roughly 45, 50 million people that are directly benefiting, that are directly earning income because of federal spending. There's another 50 million people in the US that rely on social security. And here's another important statistic. There's somewhere between 12 and 20 million people in the US that pay more than 50% tax rate today. So those people are effectively working for the federal government because half of their income goes back to the government. So when you add this all up, there's over 100, 120 million people in the US that are

• 55:11David Friedberg?

  directly working for or getting paid by the federal government in the US. That is such a significant percentage of our economy, that is such a significant dependency on individual income on a federal government. I don't want to use the term socialism, but the ability for US labor to earn is so largely dependent and largely driven by federal spending at this point, it becomes this critical linchpin to enabling progression economically, to enabling the labor force to continue to participate, that the federal government is now the primary customer or employer of most of the labor force in the United States today.

• 55:56David Friedberg?

  That is a deeply and profoundly different circumstance than what I think the founding fathers envisioned, when the federal government was supposed to be this lightweight overseeing organization of a federated republic of states. And unfortunately, I think we find ourselves in a condition, as Chumot points out, that's very hard to get out of. This is going to require a dedicated, multi-decade effort to create a slow unwinding from this deep dependency that our labor force has on federal spending. And I'm just so shocked that this isn't the The critical problem of our day that we're not all spending time on, folks have pointed out that this only goes one way at this point.

• 56:31David Sacks?

  Hey Nick, can you bring up that first Fred chart? This is federal receipts as percent of GDP and it goes all the way back to World War II. To Friedberg's point, we've never gone above 20%. Look at that. And we've had tax rates as high as 90%. I'm saying top marginal tax rates as high as 90% I think after World War II because we're trying to get out of the deficit that was created by the war spending.

• 56:56David Friedberg?

  You can't get above 20.

• 56:58David Sacks?

  Yeah, exactly.

• 56:59David Friedberg?

  The economy shrinks.

• 57:00Chamath Palihapitiya?

  No, but hold on, I gave you this OECD report. It says that since 2000, we've been in the mid twenties and the OECD average is 34 in terms of tax to GDP.

• 57:14David Friedberg?

  Tax to GDP, is this, this includes state and local then? Right?

• 57:20Chamath Palihapitiya?

  Probably, yeah.

• 57:21David Sacks?

  Yeah, I just showed federal.

• 57:23David Friedberg?

  I think this probably includes state and local.

• 57:25David Sacks?

  Yeah.

• 57:25David Friedberg?

  Which by the way is a whole nother bollywood because I didn't include those numbers in my employment statistics. The US Bureau of Labor Statistics estimates that about 20.2 million Americans are employed by local and state governments, directly employed by local and state governments. So again, when you add this all up, the majority of the US labor force is employed by the government or is a beneficiary of the government as the primary customer or is supported by government entitlement programs.

• 57:52David Sacks?

  If you go back to that Fred chart for a second, I mean, if you, if you basically acknowledge the point that 20% is the ceiling on how much we can extract from an economy based on 80 years of data, okay, with all sorts of differing tax schemes, then I think what we should say is that federal spending will be capped at 20% of GDP.

• 58:14David Friedberg?

  Yeah.

• 58:14David Sacks?

  We should, you see what I'm saying? Like if we can't go above 20% on receipts.

• 58:17David Friedberg?

  That's it.

• 58:18David Sacks?

  Cap federal spending at 20%.

• 58:20David Friedberg?

  That should be a constitutional amendment.

• 58:22David Sacks?

  Right.

• 58:22David Friedberg?

  That's it.

• 58:23David Sacks?

  And then, and then on the revenue side, we should say, what is the best tax code to achieve that 18, 19, 20%? Because what we do right now is we just say, well, just tax the rich. But what we've seen is we've been taxing the rich as high as 90% in the past and you didn't get more revenue. So we should be much more scientific about saying, well, given that our target is, let's say 20%, what's the best way to do that? And no one really has that conversation.

• 58:52Jason Calacanis?

  No, none of the conversations have to do with data or building a bulletproof system. The same thing we could say about immigration where we try to talk about the numbers here of what's a reasonable number of people and tying that to an actual number. And it's pretty obvious we should have one immigration policy when we have 5% unemployment and a different one if we had, God forbid, 15 or 20% unemployment.

• 59:18David Sacks?

  Wait, can we just stay on budget for a second?

• 59:19Jason Calacanis?

  It could be tied to the unemployment rate.

• 59:22David Friedberg?

  The fundamental structural problem I'm highlighting is that we've created an economy that is so deeply dependent on federal spending that the federal spending levels are what support so many employed and so many companies in the US.

• 59:36Chamath Palihapitiya?

  You're answering your own question. That's why it can't stop.

• 59:39David Friedberg?

  Right.

• 59:40David Sacks?

  I don't think the real economy that creates all the innovation and all the value and all the, the, the good paying jobs, I think that is separate from what the government does.

• 59:49David Friedberg?

  That's the deflationary economy. That's the, that's the true market-based deflationary economy. The problem is, once we've layered in all of these layers of dependency from federal dollars flowing into businesses or into people's pockets, it's very difficult to back out of that.

• 1:00:02David Sacks?

  I don't call that dependency. I call that special interests. I think there's a lot of special interests who are basically looting the federal government and taking all this money and then they turn around and use some of it to, to donate back to the politicians and lobby for more spending. So what you're calling dependency is really more special interests, meaning that I don't think we need to have this level of spending in order to have a successful economy. I think it makes our economy less successful.

• 1:00:27Jason Calacanis?

  Yep.

• 1:00:28David Friedberg?

  It's still stimulatory because, Sax, remember Mitch McConnell, when they were talking about supporting Ukraine, his primary argument, as you remember, was that all of these dollars are going to go into defense contractors' pockets, which is going to go to employees' pockets, which is going to stimulate our economy. That's the fundamental thinking.

• 1:00:44David Sacks?

  But that doesn't create value.

• 1:00:45David Friedberg?

  I know, but that's the thinking behind it, right? I mean, that's the political system that...

• 1:00:49David Sacks?

  Okay, let me just walk through this real quick. If the government prints a bunch of money and hands it to people as stimmy checks, we all understand that creates no economic value. It just creates inflation. Okay, now, if the government does the same thing, but instead a stimmy check pays people to dig holes and fill them back up, that's the exact same thing. No economic value, just inflation. Now, let's say the government pays people to create bombs that create holes in other countries.

• 1:01:17David Sacks?

  Exact same thing, no economic value for the country, it just creates inflation here. Why is that? Because the only thing that creates economic value in the United States is the production of goods and services that people can actually consume and use and that they want. And so federal spending on basically make-work projects or things that people don't really want, or they don't use, or even worse, bombs that get dropped on poor people in other countries, none of that creates any value. But I don't think it's a real economic dependency. I think it is just a special interest that keeps lobbying for all this stuff.

• 1:01:51David Friedberg?

  But Doug, what about housing and healthcare and education? Because those are the three biggest line items, and it's been inflationary across all three of those line items in the US economy. The federal government has stepped in to provide broader access to housing, broader access to healthcare, and broader access to education. And in the process...

• 1:02:07David Sacks?

  That's why the price goes up.

• 1:02:08David Friedberg?

  Yeah.

• 1:02:08David Sacks?

  You know, there's that famous chart showing inflation by category, and all the categories where the federal government provides subsidies, the prices have gone up.

• 1:02:16Jason Calacanis?

  Education, healthcare.

• 1:02:18David Friedberg?

  And housing.

• 1:02:19David Sacks?

  The more the government tries to subsidize it, the more the providers realize, right? Second, we can charge whatever we want.

• 1:02:25David Friedberg?

  Because of correct. There's one customer, and they'll always pay.

• 1:02:28David Sacks?

  Yeah, so that's gotta be completely reformed.

• 1:02:30Jason Calacanis?

  Yeah, here's a chart of all employees in government, and I think this Fred chart includes all employees in government, which would include state and local. And as you can see, we're...

• 1:02:42David Friedberg?

  Yeah, that's right. It's 20 million local and state, 3 million federal. And then the math I was highlighting was just my back-of-the-envelope math, where there's 50 million people that are on social security in the US. Plus, if you do the math on how government spending flows into employers, into employees' pockets, it's about another 45, 50 million people that benefit from federal spending in the US. We're already kind of at a point of maximal dependency, if you will.

• 1:03:10Jason Calacanis?

  Yeah, I mean, if you look at this chart, we have had 20,000 people working in government since the late 90s. Yeah, 20 million since the late 90s. It's now hitting a peak. And the question is, you know, how far up does it go from here? It's 23. Obviously, the country is growing as well each year. So as a percentage, we don't have the percentage, but... As a percentage of Americans, it hasn't grown that dramatically, but it certainly feels like this could keep going in the wrong direction.

• 1:03:42Chamath Palihapitiya?

  The one thing to keep in mind from all the doomsdaying, I would just offer you two data points. The first is that our debt to GDP, either historically, but also in relation to other countries, is still relatively reasonable. And what that basically shows is we have a lot more debt that we can't issue, which means that there's a lot more deficits to run. Not saying that it's right.

• 1:04:04Jason Calacanis?

  Yeah, before the great financial crisis, it was running at 50, 60% our debt as a percentage of GDP. And to your point, Gemma, if it's now at 1.2, it's 120%. Other countries have much higher.

• 1:04:19Chamath Palihapitiya?

  So we have a lot more to run. Yeah. So Nick, if you want to just throw that up. So it means that the countries on the right haven't failed. They haven't done great necessarily, but they haven't failed in the way that we would define failure. And it's not as if the countries on the left are crushing it the way that we would define crushing it. And so it's not clear that there's a real correlation between debt to GDP and the performance over large longitudinal periods of times as a country. That's the first thing I'll say. The second thing is if you actually look at all of these countries, the thing to keep in mind is where are populations growing and shrinking? Because at a very basic level, J. Cal, you mentioned this earlier, but when countries are shrinking, there's no fundamental ability to grow GDP. And you're just debating how much it shrinks. And the interesting thing about the United States

• 1:05:04Chamath Palihapitiya?

  is we are the only Western country that is forecasted to grow at reasonable rates above our replacement population. And so, you know, by the end of this century, we'll be around 400, 400 odd million individuals, and other countries will have been cut in half. And so, again, there's some positive news as well. Now, to your earlier point, the problem is politicians will use this as a reason to continue spending because they won't be forced to. And that's not a great thing, but this is probably why the status quo will go on for a very long time.

• 1:05:43Chamath Palihapitiya?

  Hmm.

• 1:05:45Jason Calacanis?

  So grab the bag, get your bag. Figure, figure out what your, figure out what your thing is.

• 1:05:50David Friedberg?

  I don't know, man. I just want people like voters to, people to just understand.

• 1:05:57Jason Calacanis?

  Yeah, they're not going to. Get your bag like everybody else.

• 1:06:00David Sacks?

  The problem we have is if, okay, Nick, can you pull up the Fred spending chart?

• 1:06:03David Friedberg?

  We've talked about this a few times.

• 1:06:05David Sacks?

  Well, okay, so if you look there, there's a huge spike because of COVID, because of all that COVID stimulus that was airdropped on the economy. I think we're now down to about 22% for 2023. But that, that's a big number, you know, we talked about how the absolute max you can extract is 20%. So what they should do is just freeze spending until the federal net outlays as a percentage GDP is down to 20%. That would be the, the simplest.

• 1:06:33Jason Calacanis?

  Such an easy solution. What's great about it is it takes out the politicians making this partisan. Hey, there is a logical amount of, you know, taxation we can do before we freeze up the productivity of the country, which if you talk to anybody, when taxes get high, people just start getting, protecting their wealth. I think you alluded to that with strategies as opposed to investing.

• 1:06:58David Sacks?

  The hard part of it is that, I mean, look, I think we should do it, you know, 20% cap and, and free spending until we get there. The, the hard part is that our interest expense keeps growing because as our debt rolls onto more expensive, higher interest bonds, then our interest expense is increasing. Just a few years ago, our interest expense was only 300 billion a year. Now it's over a trillion a year. And that's just going to keep growing and growing. And then the other thing that's going to grow is all the entitlements related to, to demographics. So are the country's demographics are getting worse and so the entitlement expenses are going to go up. So even holding it to 20%, if we could get there, is going to take some work.

• 1:07:40Jason Calacanis?

  I don't know if you read Larry Fink's letter. From BlackRock, it was really good and you talked about-

• 1:07:45Chamath Palihapitiya?

  You mean his 2030 business plan, G K?

• 1:07:48Jason Calacanis?

  Basically, yeah. It's his way of extracting value from it, but he did make some salient points in it as opposed to just him talking his book of why you should do his retirement, your retirement savings with BlackRock is a fair point. But just getting the, what age do people retire at? That discussion we need to have and we're not having that as a country. And then what percentage of benefits do people get at different? And how do we incentivize people to stay in the workforce?

• 1:08:11Chamath Palihapitiya?

  Well, at a minimum, don't you agree, we should just allow people to opt out of social security and in a simple way of saying, I don't need it and I'll take care of myself, use these proceeds for somebody else that could use it, that who has a better need for it?

• 1:08:27Jason Calacanis?

  Yeah. I mean, and then getting people to participate in their 401ks, you know, at an earlier age and defaulting those to on as of defaulting them to off. There's a lot of small behavioral things we could do in this country to get people saving earlier.

• 1:08:41David Sacks?

  Well.

• 1:08:42Chamath Palihapitiya?

  I, I saw that Robinhood was running a scheme where if you moved your Roth IRA, they gave you 3% cash back. And I thought, is there an upper bound limit on what, on how much you could move over? Cause I wonder if I could-

• 1:08:55Jason Calacanis?

  I think you have to keep your money in there for five years.

• 1:08:58Chamath Palihapitiya?

  Yeah, but that's okay. I'm just wondering like, will they really write like a hundred million dollar check if you move like a $5 billion Roth over?

• 1:09:04David Sacks?

  Robinhood just sent me something. So we had a portfolio company called X1, which was making a new like credit card and credit card app. It was like awesome. I don't know if you guys used it. Anyway, they got acquired by Robinhood and so the guys here just sent me their new Robinhood gold card here.

• 1:09:22Jason Calacanis?

  Yeah.

• 1:09:23David Sacks?

  This thing is the heaviest card here. Just listen to it drop. Hold on.

• 1:09:27Jason Calacanis?

  Don't cut yourself. Don't cut your toe off.

• 1:09:31David Sacks?

  Apparently it's got $1,100 worth of gold in it.

• 1:09:34Jason Calacanis?

  I have one coming myself and I'm proud to say I've sold no shares of my Robinhood. I keep all my Robinhood shares.

• 1:09:41Chamath Palihapitiya?

  If my, if I move my Roth IRA, they'll have to give me the whole building.

• 1:09:44Jason Calacanis?

  They'll give you a gold-plated building?

• 1:09:46David Sacks?

  Actually, they, they sent it to me in a Louis Vuitton, with a Louis Vuitton wallet. This is like unbelievable. Yes, it's got-

• 1:09:54Jason Calacanis?

  And look, they got a $50,000 ad on, they got a $50,000 ad on the-

• 1:09:58David Sacks?

  Look at this. You got like a little LV wallet there?

• 1:10:01Jason Calacanis?

  Oh, I like-

• 1:10:02Chamath Palihapitiya?

  There you have it, folks. Send a Louis Vuitton wallet, get a free $50,000 ad on the pod. Sign up now for your Robinhood gold.

• 1:10:10Jason Calacanis?

  Yeah.

• 1:10:10Chamath Palihapitiya?

  But you, what is it, a credit card?

• 1:10:11Jason Calacanis?

  Yes, a credit card. It's a credit card. Yeah. Their, their, their whole plan was always to This is hype. Provide the full suite of services.

• 1:10:17Chamath Palihapitiya?

  Do you guys carry credit cards and money?

• 1:10:21Jason Calacanis?

  Do you have any money? I keep forgetting my wallet, but I always carry money.

• 1:10:24Chamath Palihapitiya?

  You have money?

• 1:10:25Jason Calacanis?

  I always carry.

• 1:10:26David Friedberg?

  Yeah, like to tip, tip people or something?

• 1:10:28Jason Calacanis?

  Always have some cashish. Never, you always gotta have a couple of hundy. Just in case. It's a really bad habit. You gotta keep a couple of hundy in the bag. You put the hundred on the outside, J. Calvin, there's a bunch of ones.

• 1:10:41Jason Calacanis?

  No, we don't do that. You can quit doing that in Brooklyn. You get your ass. Got the brazier on the outside? No, no, no, no. What we do is we get rid of the ones, the fives and the tens. You just get rid of those. You don't even keep them in circulation. That's, that's the best line.

• 1:10:55Chamath Palihapitiya?

  I get cash when I go to Vegas.

• 1:10:58Jason Calacanis?

  But that's it. Yeah. The, the best line ever was, woman comes up to Sammy Davis Jr. And she says, hey, can you, um, can you, can you break, uh, you know, this whatever amount of money? And he just pulls out a hundred and gives her a hundred and she says, no, no, can, can you make change? He says, that is change, baby. That is change. And that's when he considered change was the hundy.

• 1:11:21Chamath Palihapitiya?

  There was a story out of Jeju. So you know Triton Poker?

• 1:11:25Jason Calacanis?

  Yes.

• 1:11:26Chamath Palihapitiya?

  Okay. I'm not going to say who it is, but there's a guy that was playing the high stakes cash game. And apparently, so he lost like eight million bucks. Okay. He tipped out 450K in 25K chips to like the staff and like the person giving him a massage and stuff. So it apparently became a free for all trying to get into this game where everybody was like, are we pooling tips? Are we pooling tips? And they were like, no, we're not pooling tips.

• 1:11:52Chamath Palihapitiya?

  Just flags. He was tipping off flags.

• 1:11:54Jason Calacanis?

  Wow. That is incredibly, incredibly generous. All right. Science corner, rapid fire. You wanted to get to Coco. Here we are. We're at Coco. Friedberg?

• 1:12:09Jason Calacanis?

  You have

• 1:12:09David Friedberg?

  You guys, you guys asked about cocoa. You want to pull up the commodity price chart on cocoa? Look at that.

• 1:12:14Jason Calacanis?

  Okay. This is not cocaine. This is cocoa. This is chocolate, precursor to chocolate, not

• 1:12:20David Friedberg?

  This is chocolate. As you guys can see from this chart, cocoa has moved in price from about 2,000 bucks a ton, which is where it normally trades at, to $10,000 a ton. 70% of cocoa is grown in West Africa, in Ghana and Ivory Coast. And in that area, they've been severely hit by this El Nino weather year that we're just kind of coming out of. So here's all the cocoa production. 73% of it's in Africa, mostly in Ghana and Ivory Coast. That's where most of the world's cocoa beans are produced. Cocoa is grown from the cacao tree, which is about 10 feet tall. These bean pods, you take them down, you roast the beans, crush it, you make cocoa. When you eat a Hershey's

• 1:13:02David Friedberg?

  bar, for example, 11% of that bar is ground up cocoa powder. So cocoa is like the critical ingredient in all the chocolate products we consume. So we had this massive El Nino event last year. So here you can see sea surface temperatures. So in Q4 of last year, El Nino spiked like crazy, and that caused a lot of rainfall to hit the west coast of Africa. And as a result, this fungus was spread in cocoa trees. There's a fungus called black pod disease. And this fungus spreads when rainfall hits the ground and it splashes up, gets in the tree, and then the tree has really bad yield and the cocoa production goes down. So now if you look at the cocoa production out of Ghana, you can see that we've seen like 50% rough decline in cocoa production.

• 1:13:46David Friedberg?

  On the final bar chart. So that's the effect. So when that happened, basically, everyone started to corner the market. So all the buyers of cocoa went in and started buying cocoa like crazy. And then all the short sellers got squeezed because there's typically a pretty good balance on the short and long side in the market. So then the short sellers got squeezed and it caused this big parabolic jump in price. And that's where we're at today. The chocolate companies, again, 11% of chocolate that you're buying at the store is made from this cocoa powder. They're talking about cutting the size of their chocolate bars, raising prices, and starting to use other ingredients. So you'll start to see that happen in the shelves in the next couple of months. But this is the big news in the commodity markets right now is this, this parabolic spike in cocoa prices.

• 1:14:27David Friedberg?

  And you know, consumers will get hit with high prices and smaller chocolate bars.

• 1:14:30Chamath Palihapitiya?

  Isn't there a scene in Trading Places?

• 1:14:33David Friedberg?

  The OJ features.

• 1:14:34Chamath Palihapitiya?

  Yeah.

• 1:14:35David Friedberg?

  That's right. They squeeze the orange market. That's right. That's basically what's happening in cocoa. So there was a bad weather event. Yields dropped by 50%. So we got half the production. And then all the traders came in and they squeezed the short side of the market and price spiked. So that's kind of what started off.

• 1:14:51Chamath Palihapitiya?

  If I had a dollar for the number of times a fungus has ruined a good time, man.

• 1:14:57Jason Calacanis?

  Well, you know, it's interesting. I was looking at this and I was worried about chocolate prices. I was really worried about chocolate prices, specifically on Amazon right now and these edible anise. Uranus prices have gone up somehow. So these chocolate Uranus prices are skyrocketing.

• 1:15:23Jason Calacanis?

  I just typed in Uranus. I typed in free bird's Uranus and chocolate and this came up. It was the number one result.

• 1:15:33Jason Calacanis?

  There it is. Uranus. Chocolate prices are going up.

• 1:15:36David Friedberg?

  I know what I'm getting you guys for Christmas this year.

• 1:15:39David Sacks?

  You notice it was priced in euros, not dollars.

• 1:15:42Jason Calacanis?

  Yeah, it's not available in America.

• 1:15:43David Sacks?

  It was coming from Belgium. I guess they got some serious kink going on over there.

• 1:15:47Jason Calacanis?

  Yes. If you want a chocolate Uranus, it's there for you. I mean, I just was like, Google search chocolate Uranus. And yeah, I don't recommend you make that search if you're listening to the pod.

• 1:16:03David Sacks?

  Well, when I heard there was a spike in Coke prices, it made me think of this.

• 1:16:11Jason Calacanis?

  Say hello to my little friend. When's the last time, when's the last time you watched Scarface beginning to end? Not like just caught a couple scenes.

• 1:16:20David Friedberg?

  I watched it. Yeah.

• 1:16:21Jason Calacanis?

  It holds up, yeah?

• 1:16:22David Friedberg?

  Yeah. I mean, man, it is. By the way, I saw Dune 2. Jamath, have you seen it?

• 1:16:28Chamath Palihapitiya?

  No, don't, don't say anything, because I need to wait till it comes to screen me.

• 1:16:31Jason Calacanis?

  Okay, I loved it.

• 1:16:33David Friedberg?

  I'm going back to see it. I'm going back to see it again. I'm going to see it at IMAX.

• 1:16:36Jason Calacanis?

  So you're with me?

• 1:16:37David Sacks?

  I didn't hate it. I just think it's overrated. Like Spielberg said, it was like one of the greatest moments.

• 1:16:42David Friedberg?

  It is one of the greatest movies I've ever seen. I thought.

• 1:16:44David Sacks?

  No, it's completely overrated. I'm not saying it's bad. It's just not that.

• 1:16:48Jason Calacanis?

  Scale of one to 10, give it a number.

• 1:16:50David Friedberg?

  I will do anything to have this guy do Dune 3. He's talking about whether or not he should do it. He's like, I'm only gonna do it if it's gonna be better than Dune 2.

• 1:16:57Jason Calacanis?

  You know, he's Canadian.

• 1:16:59David Friedberg?

  Canadian guy, yeah.

• 1:17:00Jason Calacanis?

  He did Sicario.

• 1:17:01David Friedberg?

  Sicario and The Arrival. Like, he's honestly one of the top three directors of our era.

• 1:17:08Chamath Palihapitiya?

  No, Denis Villeneuve.

• 1:17:10David Friedberg?

  Villeneuve.

• 1:17:14David Sacks?

  I don't know. The hero in that movie is like the soy boy type. I mean, I don't really believe that he's leading an army.

• 1:17:22David Sacks?

  It's not credible.

• 1:17:23David Friedberg?

  You know the story? I read a lot about, you know, these were all like short stories published in magazines by Frank Herbert.

• 1:17:30Jason Calacanis?

  Serialized. They were serialized.

• 1:17:32David Friedberg?

  And he was really into drugs. He was really into mushrooms. And so the spice came around from the mushrooms.

• 1:17:38Jason Calacanis?

  Makes sense.

• 1:17:39David Friedberg?

  It was written in 1965, when there was this idea that we needed to move towards zero population growth, because the population spike on Earth was gonna cause resource constraints and we were all gonna die, if you guys remember this. And so there was this big movement. It's what launched the hippie movement.

• 1:17:55Jason Calacanis?

  Did they not have math back in 1965?

• 1:17:58David Friedberg?

  Yeah, they really did think this, and that there wasn't gonna be improvements in productivity. So there were limited resources. The world was gonna run out of land. And the ecology, or the environmentalist movement, kind of sprung out of this effort. So a lot of what he wrote about was the ecology and the connection between the fungus and taking mushrooms and better understanding the world around you. So so much of this was rooted in a hippie movement, Sacks. To your point, when he wrote these original.

• 1:18:23Jason Calacanis?

  Did they ever explain what the spice is in Dune?

• 1:18:27David Friedberg?

  No, and it was tied to mushrooms.

• 1:18:29Jason Calacanis?

  They never explain why people want spice.

• 1:18:31David Friedberg?

  When Frank Herbert was interviewed later, he talked about how it was meant to be about fungus is the graiter of life and this graiter of life. And he wanted spice to be representative of mushrooms, of fungus, psilocybin. And it was like, it opens your mind and you get more connected with nature and all this stuff. So it was rooted in that, but they never really get into details on it in the book.

• 1:18:50Jason Calacanis?

  So this film to you, Freiburg, is a 10 out of 10?

• 1:18:53David Friedberg?

  Nine out of ten.

• 1:18:54Jason Calacanis?

  Okay, I was about to, I was gonna give it an eight and a half out of ten.

• 1:18:57David Friedberg?

  I think, I think the first half was slower. I'd say like the second, I mean, they're like, Tom, I'm not ruining anything.

• 1:19:03Chamath Palihapitiya?

  I really like Zendaya. I think she's super cool. I agree with you, Sacks. I'm not a huge Timothée Chalamet fan. I think he's too skinny.

• 1:19:11Jason Calacanis?

  Is it his name? Is it the name or is it?

• 1:19:13Chamath Palihapitiya?

  No, no, no, I know. I grew up in Canada with a lot of French people, so I'm cool with that. I don't like, he's, he's just too skinny. Like, do a couple pushups or something.

• 1:19:24Jason Calacanis?

  It's the vibes in general. What do you give it, Sacks? And, um,

• 1:19:27David Friedberg?

  I give it an eight and a half. I won't give it a nine.

• 1:19:29Jason Calacanis?

  Okay, I was eight and a half. What do you give it, Sacks? Give it a number?

• 1:19:32David Sacks?

  I'll give it a six and a half.

• 1:19:33Jason Calacanis?

  Six and a half. Now, if it had a proper lead, who was more than a hundred and twenty pounds?

• 1:19:38Chamath Palihapitiya?

  Sacks, who is a good?

• 1:19:39Jason Calacanis?

  What would you give it?

• 1:19:39Chamath Palihapitiya?

  Yeah, who's a good lead for you, Sacks, where you would have given it a nine? Exactly the same. Everything is the same.

• 1:19:44Jason Calacanis?

  Jake Gyllenhaal?

• 1:19:45Chamath Palihapitiya?

  A soy boy. Oh, Jake Gyllenhaal? Is it, is that, is that more of a Sacks nine?

• 1:19:49David Friedberg?

  Like ultimate fighting body Jake Gyllenhaal?

• 1:19:51Jason Calacanis?

  He's, yes, I mean, who, Tom Cruise?

• 1:19:55Chamath Palihapitiya?

  Ryan Gosling?

• 1:19:56Jason Calacanis?

  Ryan Gosling.

• 1:19:59David Friedberg?

  Sacks, what movie is a ten out of ten for you?

• 1:20:02David Sacks?

  I don't know, you need like a young Russell Crowe or something.

• 1:20:05David Friedberg?

  Right.

• 1:20:05David Sacks?

  Don't you?

• 1:20:06David Friedberg?

  But have you seen the original Dune? That guy, if you think that this guy was-

• 1:20:10David Sacks?

  Kyle MacLachlan.

• 1:20:11David Friedberg?

  Oh my god, that guy.

• 1:20:12David Sacks?

  In a David Lynch movie.

• 1:20:13David Friedberg?

  Yeah, the David Lynch movie.

• 1:20:14David Sacks?

  That was good, actually.

• 1:20:15David Friedberg?

  Yeah, it was a little, I mean, it was similarly, it was like a soft protagonist.

• 1:20:19Jason Calacanis?

  What, what, what is a, what is a nine out of ten Sacks movie?

• 1:20:23David Friedberg?

  Yeah, what's a ten out of ten for you, Sacks?

• 1:20:25Jason Calacanis?

  Gladiator,

• 1:20:28Jason Calacanis?

  Goodfellas, Casino, Sicario.

• 1:20:31Chamath Palihapitiya?

  Casino's incredible. Sicario's incredible.

• 1:20:33David Sacks?

  All those are good. All those are good.

• 1:20:34Jason Calacanis?

  I know, we have the same taste.

• 1:20:36David Sacks?

  I might give this a seven. I, I mean, I, I gotta see it again. Maybe I'll revise it up to a seven, but it's not more than a seven in my book.

• 1:20:42Chamath Palihapitiya?

  Isn't there like a Sicario three coming out?

• 1:20:44Jason Calacanis?

  I hope so. Sicario one and two are so rewatchable. Those are like the ultimate rewatchable.

• 1:20:49David Friedberg?

  Sicario one was unbelievable.

• 1:20:51Jason Calacanis?

  Unbelievable. Sicario two does it for me.

• 1:20:53Chamath Palihapitiya?

  That scene with Emily Blunt at the border where you hear the noise of like, what are those locusts?

• 1:20:59David Friedberg?

  Totally.

• 1:20:59Chamath Palihapitiya?

  You know, oh my god.

• 1:21:01Jason Calacanis?

  No, no, when they're in traffic and the cars are parked.

• 1:21:03Chamath Palihapitiya?

  Yeah, that's what I mean. Yeah, yeah, yeah.

• 1:21:05David Friedberg?

  That scene is like,

• 1:21:06Jason Calacanis?

  That scene to me is like- The Bane scene in Dark Knight.

• 1:21:11David Friedberg?

  Yeah.

• 1:21:12Jason Calacanis?

  And, and also when he's at the dinner table of the drug lord.

• 1:21:15David Friedberg?

  Yeah.

• 1:21:16Jason Calacanis?

  Oh my god, that scene is intense.

• 1:21:19David Friedberg?

  I think that film has probably the best cadence of any modern film. Like, the way he kept pacing that film did not turn off for one second. You were hooked from beginning to end and you could watch a million times.

• 1:21:30David Sacks?

  Well, by the way, the pacing.

• 1:21:32David Friedberg?

  My godfather was also like that.

• 1:21:33David Sacks?

  The pacing in Dune 2 is terrible. I mean, he spends all this time in the wilderness and then the.

• 1:21:37Jason Calacanis?

  I won't disagree.

• 1:21:39David Sacks?

  Oh, you haven't seen it yet? Then why are we talking about it?

• 1:21:41Jason Calacanis?

  Because we're trying to troll him.

• 1:21:43David Sacks?

  I'm waiting for it to come to streaming.

• 1:21:44David Friedberg?

  We had this whole conversation last time. Does anyone else think that Arrival is like one of the best films of our generation?

• 1:21:50David Sacks?

  No.

• 1:21:52Jason Calacanis?

  I mean, it's good, but it's not.

• 1:21:53David Sacks?

  I think it's good.

• 1:21:53Jason Calacanis?

  Great.

• 1:21:54David Friedberg?

  It's like such a mind blowing film.

• 1:21:57Jason Calacanis?

  Oh, Sacks, you know, maybe, maybe like a, a young buff Matt Damon. No?

• 1:22:04David Sacks?

  Uh.

• 1:22:04Jason Calacanis?

  Matt Damon, no?

• 1:22:05David Sacks?

  I don't really see him in the role, uh.

• 1:22:08Jason Calacanis?

  Okay, how about, um, what's that guy's name? Adam Driver?

• 1:22:13David Sacks?

  Yeah.

• 1:22:13Jason Calacanis?

  Young Adam Driver?

• 1:22:14David Sacks?

  Oh, yeah, Adam Driver would work, yeah. He could do it.

• 1:22:17Jason Calacanis?

  He would, yeah.

• 1:22:18David Sacks?

  That's kind of like a Kyle McLaughlin type pick, you know, he's a little.

• 1:22:21Jason Calacanis?

  Yeah, exactly.

• 1:22:21David Sacks?

  Little emo. Yeah.

• 1:22:24Jason Calacanis?

  Yeah, but not so skinny. Yeah, I mean, the, the idea that he's gonna win all these fights and he weighs 120 pounds wet out of the showers makes no sense, like.

• 1:22:33David Sacks?

  Yeah, Zendaya kicks his ass.

• 1:22:36Jason Calacanis?

  Zendaya does?

• 1:22:37David Sacks?

  Doesn't she kick his ass?

• 1:22:38Jason Calacanis?

  Basically, yeah. I mean, let's not give it up here now. No, that scene with best opening scene of a film. What do you got, Sacks? What's your best, most intense scene?

• 1:22:51David Sacks?

  Of, of any film, any opening scene?

• 1:22:53Jason Calacanis?

  Intense. I mean, the Joker bank heist scene is incredible.

• 1:22:58David Sacks?

  That's good.

• 1:22:59David Friedberg?

  Daniel Day-Lewis in the shaft of There Will Be Blood.

• 1:23:03Jason Calacanis?

  Absolutely. Climbing out of there with the broken leg. Ooh.

• 1:23:06David Friedberg?

  Oh my god, that sets the tone. That's who he is as a person. That's everything.

• 1:23:09Jason Calacanis?

  That's your, that's your spirit animal.

• 1:23:11David Friedberg?

  That's it, that's it.

• 1:23:12Jason Calacanis?

  You're bitter and angry and you have a, you have a competition in you.

• 1:23:17David Friedberg?

  I have a competition in me.

• 1:23:18Jason Calacanis?

  I don't like to see others succeed. I'm David Friedberg. I'd like to see the world fair.

• 1:23:24David Friedberg?

  Strike, strike.

• 1:23:26David Friedberg?

  Right.

• 1:23:26David Sacks?

  Actually, it's true.

• 1:23:27Jason Calacanis?

  It's accurate.

• 1:23:30David Sacks?

  It's your favorite movie.

• 1:23:32David Friedberg?

  For a reason. Yeah, you you admit it.

• 1:23:34David Sacks?

  Own it, own it.

• 1:23:35Jason Calacanis?

  Just own it.

• 1:23:36David Friedberg?

  I drink your milkshake.

• 1:23:37Jason Calacanis?

  Keep the lie alive.

• 1:23:39David Friedberg?

  I do have a competition in me. Yeah.

• 1:23:41David Sacks?

  It's funny. The only like opening scene of a movie that I really remember is like Reservoir Dogs. You know, when you talk about like an opening scene that's memorable.

• 1:23:51David Friedberg?

  Pulp Fiction?

• 1:23:52David Sacks?

  Well, no, what was the openings? Oh, yeah. The opening scene Pulp Fiction is pretty good, too, where they're robbing the diner.

• 1:23:57David Friedberg?

  Yeah, the diner. It's like you're you're hooked on the dialogue right at the beginning.

• 1:24:00David Sacks?

  Yeah.

• 1:24:02David Sacks?

  Yeah, probably some Tarantino movie.

• 1:24:04David Friedberg?

  There was nothing like that, right? When that came out, you're like, what is this? And then you're just like.

• 1:24:07David Sacks?

  Actually, the opening scene of Goodfellas is really good where the guy's kicking the trunk from the inside. They think he's dead.

• 1:24:14Jason Calacanis?

  Yeah.

• 1:24:15David Friedberg?

  The dum, the dum, the dum, the dum.

• 1:24:17David Sacks?

  Yeah.

• 1:24:19Jason Calacanis?

  Saving Private Ryan.

• 1:24:20David Sacks?

  Also, I'd say Heat.

• 1:24:22Jason Calacanis?

  Pretty good.

• 1:24:22David Friedberg?

  Tomorrow, if you want to go see it at IMAX.

• 1:24:24David Sacks?

  You gotta put Heat on that list, J. K.

• 1:24:26Jason Calacanis?

  Heat, amazing.

• 1:24:27David Sacks?

  Yeah.

• 1:24:28Jason Calacanis?

  I mean, Heat is definitely top 10. They're coming out with Heat 2, by the way. They wrote a book and then this coming out. I can't wait for Heat 2 and Gladiator 2. Where where do you go to see the IMAX?

• 1:24:38David Friedberg?

  Oh, they have a good one in the city in San Francisco.

• 1:24:40Jason Calacanis?

  The Metreon is a 70 millimeter.

• 1:24:43David Friedberg?

  It's a 70 millimeter. It's like, it's ginormous. And they're doing the full print at that theater of Dune 2. So it's like the act. He shopped the thing in 70 millimeter IMAX.

• 1:24:52Jason Calacanis?

  I saw it in a smaller IMAX.

• 1:24:54David Friedberg?

  Extremely expensive.

• 1:24:55Jason Calacanis?

  Absurdly expensive.

• 1:24:57David Friedberg?

  Absurdly. He spent like $190 million on this film.

• 1:25:00Jason Calacanis?

  It's fantastic. Everybody go see Dune 2.

• 1:25:02David Friedberg?

  Sax, what what films do you have coming out? Anything interesting?

• 1:25:04Jason Calacanis?

  Producing anything?

• 1:25:06David Friedberg?

  What's in the production line?

• 1:25:07Jason Calacanis?

  You bought the rights, right, to something?

• 1:25:08David Sacks?

  We released Dolly Land earlier this year with Ben Kingsley playing Dolly.

• 1:25:12Jason Calacanis?

  Yeah.

• 1:25:13David Sacks?

  And actually, Elon just posted a long reminiscence about how he made Thank You for Smoking, which was kind of cool. Did you guys see that?

• 1:25:21Jason Calacanis?

  Nice. No, I didn't see it. He tweeted it or?

• 1:25:23David Sacks?

  Someone tweeted like, hey, did you know that like Elon Musk and Peter Thiel and Max Levchin and David Sacks produced this movie? Thank you for smoking. Because it's been like almost 20 years. And so

• 1:25:35Jason Calacanis?

  I remember.

• 1:25:35David Sacks?

  People don't know about it. So anyway, that someone tweeted it and Elon responded. There's like a really crazy story behind it. And they were like, oh, tell us. And he wrote up a long tweet explaining how he got the rights and his memory was actually really good. I was like impressed that he remembered all of these details from 20 years ago.

• 1:25:51Jason Calacanis?

  Yeah.

• 1:25:52David Sacks?

  I tweeted back like, look, if Jason Reitman's up for the sequel, let's do it.

• 1:25:56Jason Calacanis?

  Reitman's doing pretty good. He's doing okay. All right, everybody. For the Rain Man, David Sacks, Shemof, Polly Hapatia, the Chairman Dictator, the Sultan of Science, the world's greatest moderator, blah, blah, blah. We'll see you. Oh, and by the way, if you're listening to this, go ahead and check out All In Podcast on YouTube and subscribe. When we hit a million subscribers, which we're well on our way to, halfway there, I think, we're gonna throw a million subscriber party. And so, yeah, subscribe and you might get an invite. And we're gonna try to have as many people at the million subscriber party as possible. When we hit, I think, 600,000, we're gonna do a live Q and A

• 1:26:37Jason Calacanis?

  on the channel. So, really cool milestones coming up for the pod, and we'll see you all next time. Bye bye.

• 1:26:44Speaker 04

  Bye bye. Love you, boys.

• 1:26:50Jason Calacanis?

  Rain Man David Sacks.

• 1:26:54Speaker 04

  And instead, we open source it to the fans, and they've just gone crazy with it. Love you, S. I. Queen of Kinoah.

• 1:27:07Speaker 04

  Besties are gone.

• 1:27:10Speaker 04

  That is my dog taking a piss in your driveway.

• 1:27:17Chamath Palihapitiya?

  We should all just get a room and just have one big U. Georgie, because they're all just like, it's like this, like, sexual tension, but they just need to release them out.

• 1:27:25Speaker 04

  What? You're the bee. What? You're a bee. What? We need to get merch.