#1075 Dwarkesh Patel On Why The Future Will Be Wild

Dwarkesh Patel is the Host of "The Lunar Society" podcast, and blogs on his website https://www.dwarkeshpatel.com/ In this conversation, we discuss everything from artificial intelligence, The "Miracle Years" of past visionaries, Longtermism, effective altruism, talent as leverage, the myth of the myth of the well read person, the power of the human brain, and human enhancement. This one is a marathon and we cover everything. I hope you enjoy the tremendous value in this episode. ======================= Compass Mining is the world's first online marketplace for bitcoin mining hardware and hosting. Compass was founded with the goal of making it easy for everyone to mine bitcoin. Visit https://compassmining.io/ to start mining bitcoin today! ======================= LMAX Digital - the market-leading solution for institutional crypto trading & custodial services - offers clients a regulated, transparent and secure trading environment, together with the deepest pool of crypto liquidity. LMAX Digital is also a primary price discovery venue, streaming real-time market data to the industry’s leading analytics platforms. LMAX Digital - secure, liquid, trusted. Learn more at LMAXdigital.com/pomp ======================= Don't miss Mainnet, the most anticipated crypto event of the year, September 21-23 in New York City. Join 4000+ crypto builders and thought leaders for 3-days of can't-be-missed keynotes, fireside chats, demos, networking, and more. Get $300 off of your pass today by visiting https://mainnet.events and entering promo code "POMP" at check out. See you this fall at Mainnet 2022! ======================== BCB Group is the leading payment services partner for the digital assets industry. BCB Group provides payment services in 30+ currencies, FX, cryptocurrency liquidity, digital asset custody and BLINC, which is BCB’s free, instant settlements network for the BCB client ecosystem. Find out more by visiting bcbgroup.com/pomp ======================= If you’re trying to grow and preserve your crypto-wealth, optimizing your taxes is just as lucrative as trying to find the next hidden gem. Alto IRA can help you invest in crypto in tax-advantaged ways to help you preserve your hard earned money. Alto CryptoIRA lets you invest in more than 200 different coins and tokens with all the same tax advantages of an IRA. They make it easy to fund your Alternative IRA or CryptoIRA via your 401(k) or IRA rollover or by contributing directly from your bank account. So, ready to take your investments to the next level? Diversify like the pros and trade without tax headaches. Open an Alto CryptoIRA to invest in crypto tax-free. Just go to https://altoira.com/pomp ======================= Crypto wallets and browser extensions are outdated, limited in features, and don’t meet the needs of today’s Web3 users. Core, the free, non-custodial browser extension built by Ava Labs, is more than just a wallet. Core is packed with features that give Avalanche users a more seamless, and secure, Web3 experience. With Core, any crypto user can easily swap assets, display NFTs in a beautiful interface, and store your assets in a Ledger-enabled wallet. Plus you can put real dollars in your Core wallet in just a few clicks. Go to www.core.app to access the full power of Web3 on Avalanche! =======================

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

• 0:02Anthony Pompliano?

  What's up everyone? This is Anthony Pompliano. Most of you know me as Pomp. You're listening to the Pomp Podcast, simply the best podcast out there. Now let's kick this thing off. Dwarkesh Patel is the host of the Lunar Society, and he also writes a blog at dwarkeshpatel.com. In this conversation, we talk about artificial intelligence, the miracle year of past scientists, long-termism, effective altruism, talent as leverage, the myth of the myth of the well-read person, popularizers as intellectual market makers, and the power of the human brain, including human enhancement. I really enjoyed this conversation, and I hope you guys enjoy it as well. Let's get into the conversation now.

• 0:44Speaker 01

  Anthony Pompliano runs Pomp Investments. All views of him and the guests on his podcast are solely their opinions and do not reflect the opinions of Pomp Investments. You should not treat any opinion expressed by Pomp or his guests as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his personal opinion. This podcast is for informational purposes only.

• 1:07Anthony Pompliano?

  All right, guys. I'm here with Dwarkesh. I'm very excited about this conversation. I thought a great place to start would be around artificial intelligence, but not from maybe the perspective most people have. You said something to me recently that just stuck with me, which is the problems that computers have are actually some of the easiest things for human brains to do, and vice versa. Some of the hardest problems for human brains are actually the easiest things for computers to do. Explain that a little bit more.

• 1:36Speaker 02

  Yeah. Well, first of all, thanks for having me on. I'm really excited about this. That's such an interesting thing. If you look at the things that AIs are really good at, and this is changing a little bit, to be fair. If you think of like calculating like 10-digit numbers, you know, computers can do that in like nanoseconds, literally. If you think about just some stuff that like babies can do, right? Like recognizing faces, grammar, like if you think about Chomsky's universal grammar stuff, you know, just like how how sentences are strung together in a way. It's really hard to like actually set up rules that computers can understand about parsing grammar trees. That's something, you know, again, babies can do. So it's really interesting.

• 2:17Speaker 02

  But this is changing. I don't know if you've seen like the DALL-E, the DALL-E two, the GPT three. These like the GPT three is like actually producing essays. Like it writes essays better than probably most of the people in my college. DALL-E is generating art that's like really fucking cool. And so these are things you would think that, oh, no, these are the things that are like humans, humans expertise and, you know, the calculations we can export to the computers. So I'm, I'm not sure which way this is trending now because, yeah.

• 2:44Anthony Pompliano?

  Is the problem that the computers can do the really tough calculations, but they can't do things like facial recognition, something we're just, we haven't had enough technology innovation. And eventually the computer will be able to do both the calculations and also what a human can do.

• 2:58Speaker 02

  I would think so, right? Because, well, it's really mysterious because if you think about, you know, it sounds impressive to say, yo, you can do all these calculations. But if you think about it from a computer architecture point of view, it's like, it's like a few gates to actually do these like integer addition. This is like trivial stuff in terms of like how much actual computational hardware is needed. Whereas like recognizing a face, I mean, just think about like writing a program to do that directly. You had to train these like huge neural nets to be able to do that. Yeah, so it's actually kind of mysterious that our brain didn't just like add a little faculty. That's like, yeah, we would add big numbers. But I guess we just never had the evolutionary pressure to need that capacity. But yeah, I would think eventually if our brains can do it and our brains are physical hardware,

• 3:41Speaker 02

  why can't we build artificial physical hardware that does the same thing our brains can do? And it can do everything we can do.

• 3:46Anthony Pompliano?

  Well, it feels like when we are building the software and hardware to be able to do this stuff. But we have to break down so much of what the brain does into math and science for the computer to be able to actually execute it. So if you look at facial recognition, like a lot of the facial recognition systems, they just use, you know, 12 points on a face and that's what. They're doing. So it's less about some sort of arbitrary like that's a face. It's not a face. This faces person A, this faces person B, and it's much more mathematical, right? It's literally looking at, you know, sometimes 12 points, sometimes more, sometimes less to try to get to the granularity of how does the computer actually recognize this is the person that it's looking for? This is the the item. There has to be something that fits within the framework of math, right?

• 4:31Anthony Pompliano?

  For the computer to be able to do it. Cause at the end of the day, like the computer is a math system.

• 4:34Speaker 02

  Right, right, right. This is one of the interesting things between difference between like Tesla. And I don't know if you've heard of Com AI. This is like George Hotz's startup. So like the difficulty with self-driving is you had to account for all these edge cases, right? Like you can't have a you can't have a self-driving car that's like able to do everything, but like it'll run over a child.

• 4:53Anthony Pompliano?

  99% accuracy is really bad.

• 4:56Speaker 02

  99% of it will hit the child.

• 5:00Speaker 02

  Yeah. So then you have to deal with all these edge cases, which makes it really difficult. Like if the computer had you've like hardcoded in like, you know, the lane lines and everything, but you haven't like gotten to not killing the grandma, you know, you're fucked.

• 5:13Anthony Pompliano?

  Is this why Tesla has such an advantage? Because they have every single Tesla on the road collecting so much data and it ultimately is just a data problem? Or is there other ways to look at it?

• 5:23Speaker 02

  I'm actually not sure about this, but I think the one another interesting thing Tesla does is there's this great guy who has a blog about engineering, Austin Vernon, and he was writing about Tesla. One of the interesting things he pointed out is you look at the way Elon Musk thinks about problems of manufacturing. They've built like this amazing manufacturing machine and it's really difficult to do that, right? Like they've got a bigger market cap than all the other automakers in the US combined. Like there was something about adding fluff in the top of the cars to make sure that the whole thing was insulated. And and then, you know, it was just like adding so much overhead to the manufacturing because robots can't pick up, pick up this fluff. And then Elon just asked like, do we really need this? Let's just run some experiments. Like, does it actually add insulation?

• 6:08Speaker 02

  And they realize, no, it doesn't. So just simplifying the whole process. It can be manufactured fast and efficiently and reliably and precisely. I think there's a lot of interesting things Tesla is doing.

• 6:18Anthony Pompliano?

  Elon obviously didn't start out with ambitions in the 90s to build a car company. He didn't start out trying to say, hey, I want to go to Mars or create rockets. But he does have this apparent skill from a first principles thinking and kind of a framework. How important is it that Elon didn't come from those industries to, if he had been a rocket scientist or he had been a car manufacturer and grown up in, you know, the Ford kind of executive program? Like, would he have been able to do this or did it take an outsider?

• 6:49Speaker 02

  Yeah, that's such an interesting question. You, because there's like aerospace was such a stagnant sector for so long. And so maybe, but that's what it takes, right? Like Elon comes from software, obviously. He founded X.com, which became PayPal. And the whole scheme about software is we want to scale this as fast as possible. We want to make this as cheap as possible. The most amount of people to use it. Maybe that mentality just hadn't pervaded these engineering disciplines. And so just that attitude he had maybe was the thing that was most important. Because like the difference between SpaceX and what came before it is like huge. It was, it costs $20,000 per kilogram to send things to space in the 1990s, I believe. And Elon brought that down to 2,000. That's an order of magnitude difference.

• 7:34Speaker 02

  Like those kinds of differences, space, I mean, space travel had been around for decades before that. And it's like, you can still bring it down an order of magnitude. That's like amazing.

• 7:42Anthony Pompliano?

  Yeah. And it feels like once he broke through, right? And kind of the tech innovation happened. Now everyone is like, oh, we have all these different ideas. We have smaller rockets. We have people doing space tourism. Like, like it was almost kind of the Roger Bannister four minute mile. Everyone thought about it. The second that one person did it, then a bunch of people went and ran the four minute mile. And it feels like Elon kind of did that a little bit with space exploration.

• 8:07Speaker 02

  Yeah, that's so interesting. There, Jimmy Sony has a great book about the PayPal mafia. Peter, like people like Peter Thiel, Max Levchin, obviously Elon Musk, about how they founded this company and how they went on to do like found all kinds of other companies, YouTube, LinkedIn. This all comes out of the PayPal mafia. And one of the interesting hypotheses you can develop about like, well, why is it the case that PayPal, this one company led to a whole bunch of other companies in the form of the founders exited? Then they just built like basically half of Silicon Valley. And now with obviously Elon, like most of car manufacturing, most of the space industry. So why was this group of people such prolific founders?

• 8:48Speaker 02

  And one interesting hypothesis is, you know, maybe it was a fact that PayPal wasn't that successful in the sense that when they exited eBay bought them for, I think, like a billion dollars, which is a good sum of money, but it's not like, it's not like, it's not like we got about a $50 billion. And so these people who were super ambitious, they did have enough money to fund their next businesses, but it wasn't enough for them to feel complacent, you know?

• 9:13Anthony Pompliano?

  Yeah, well, it's also most young founders, we always point when we think of young founders, we think of Mark Zuckerberg or, you know, whatever. But the average age of a successful entrepreneur in America is like early 40s, right? So you have experience, you have capital, you have network, you have connections, like all these different things. But also, usually people build their biggest companies not as the first one. And so PayPal, PayPal wasn't even actually Elon Musk's first company. But if you think about, kind of in some way, you have almost practiced. He does Zip2, then he does PayPal, right? And then all of a sudden, by the time you get to the third, fourth, fifth one, you know the playbook, you've got the reputation, you've got access to capital, you can attract

• 9:56Anthony Pompliano?

  talent, which is incredibly important, and you also have a shit ton of experience.

• 10:01Speaker 02

  Yes, yes, yes. Yeah, no, that's super interesting. I mean, the thing with PayPal is interesting is that Elon, he got kicked out of PayPal by Peter Thiel and others. But like the reasoning, well, one of the reasons was he had just like amazing expectations for the company could do. He literally wanted to remake the financial system, right? And if you go see what he's done afterwards, in every industry he goes into, he just basically does it from scratch, like takes it to an order magnitude improvement. And, you know, maybe that's the thing about like founders who end up being more successful in their first business than Elon was with like PayPal. Let's say they hit it big, but it's like social networking or something like that.

• 10:42Speaker 02

  Maybe we're missing out on a lot of talent that could be going to like hard tech, you know, biospace, those kinds of things. But they're just like, you know, they didn't have like a middling exit, they just kept, you know, they had like a multi-billion dollar company, which is like great. But if it's somebody like Elon, they could like remake entire sectors of the economy. Maybe these people should, I don't know, like be forced to quit at some point there are first startups.

• 11:04Anthony Pompliano?

  I do think there's a level of boldness that it takes to build really, really big companies. And in some way, the easier path was like, go build like an ad optimization, you know, software. You could tell people you wanted to take it public, but like you were hoping that, you know, Google or Facebook was going to come in and buy it for four or $500 million, maybe a billion dollars and like, amazing. But at some point, people stop caring about like the exit value. And I think that's when they say like, what could we really accomplish? Right? And that's where like the boldness comes in. Now, it's weird because people who find success, some people actually lose the ambition. They lose like the edge.

• 11:46Anthony Pompliano?

  And so you do get a bifurcation, like after somebody has had a successful exit of any material size, they either become hyper ambitious and go take on crazy stuff. Brian Johnson with a kernel, he sold Braintree, I think he sold it for like $800 million or something. And then he was like, I want to go solve this like brain computer interface problem. And he went, he completely dedicated, you know, his time to doing that. He, I think he's the biggest investor in the company, put a ton of money into it. And obviously with the hyper ambitious path. But then there's folks who like, I'm gonna go to the beach. Right? And so it feels like that is a fork in the road for a lot of entrepreneurs is once they've tasted some level of success.

• 12:29Anthony Pompliano?

  You kind of find out like who's in it for the game and who is in it for the money.

• 12:32Speaker 02

  Dude, it's so hilarious when you hear people talk about engineers or founders who've been really successful in the past. And when they talk about what problem they want to solve, they literally just start from like first principles. What is literally the most important thing I could work on? They're doing, it's not even a factor to them, like how implausible does this sound like? John Carmack had a great episode on Lex recently. John Carmack, by the way, is like this legendary programmer, probably the greatest of all time, created Doom, these other games. And yeah, so he's like, he's talking about like, you know, once I was done with all this game development stuff, I was considering what should I do next? And I thought, oh, nuclear fission is an important problem. Oh, AGI is an important problem, artificial general intelligence. So these are the hardest things a human being could like endeavor. To do, right? And you're just like, yeah, that's one possibility I could work on.

• 13:18Speaker 02

  Yeah, that's that's one thing about some of these people who actually do become more ambitious afterwards is that instead of just looking at how they can make the most money, they're literally just start from complete first principles. What is the most important thing I could work on? Sam Altman, the former CEO of Y Combinator, is another interesting example of this. He's, I think, only in his 30s, but

• 13:37Speaker 02

  like, right now, he's the CEO of OpenAI, which is like the company that's releasing all these crazy fucking models that are changing the AI industry. He's also helping Helion build Fusion. So that's like not vision. This is like a completely different thing. They're trying to make energy 10x cheaper than it is now. Just like working on the two hardest problems you could possibly be working on at the same time. It's kind of interesting when those kinds of people come around.

• 13:59Anthony Pompliano?

  Well, we have a return back to that being the aspiration of a lot of founders. Like, did the pendulum swing, do you think, too much to like the social media, consumer product, ad optimization, kind of end of the spectrum? And now we're seeing a pendulum swing back to things like Anduril, Varda, you know, a number of businesses like Hadrian. You know, we just go down the line. There's a bunch of them. Like, is the pendulum swinging back?

• 14:26Speaker 02

  Interesting. Well, I don't know if you've heard this about China, but one of the interesting theories I heard about what they're up to is that, you know, they're cracking down on these like big tech companies in China, like Alibaba. Who knows where Jack Ma is right now?

• 14:43Speaker 02

  And so the question is, like, what are they up to? And one interesting theory I heard is they want, they realize that the future is in large part going to be controlled by whoever controls hard tech, right? Who is making the advancements? Obviously, AI is part of like, I guess, the more computer science aspect of it. But also other things like energy, who's controlling bio, right? And they don't even have the same, like, sense of what is correct morally with regards to like bio enhancement and things like that. So whoever controls those industries is going to control the future. And one of the interesting theories I heard about this is Maybe their idea is we're going to like crack down on people going into programming

• 15:26Speaker 02

  and software and make them like almost force them to go into like these hardware tracks that are going to be super important in the future.

• 15:32Anthony Pompliano?

  Well, you see this in their geopolitical strategy as well. Like, they definitely have run around the world and tried to create financing advantages where they go to a country, specifically they've been doing this to a lot of African nations and say, hey, we're going to provide you a loan on some, you know, interesting terms and it happens to be for your port, right? Or for some kind of critical infrastructure. And because we're the financier of it, it gives them incredible leverage or access or information into that hardware, right? Which we don't think of the same way as we think of maybe like a computer. But like, what's more important? Is it to be the hardware manufacturer for the next great,

• 16:13Anthony Pompliano?

  you know, desktop computer? Or is it more important to have a specific advantage in very strategic ports around the world?

• 16:22Speaker 02

  Yeah, that's such an interesting question. Because for since World War II, basically, the US has been the hegemonic naval power. It's basically said to the rest of the world, like, we'll protect the seas for you, but you're kind of part of our empire. Like, you're a bitch, basically, right? And then, yeah, China's like trying to turn that around. I happen to think, I haven't looked too much into this, but I happen to think that that's probably a good thing for the countries they're going into. Like, people talk about it as like exploitative or something. And part of it probably is, but also like getting money on terms, getting loans on terms that the rest of the world is not willing to offer to you. Assuming you have good leadership that's like not just going to squander the money and then your future country's left in a bunch of debt. Yeah, like, I think that's probably, probably a good thing.

• 17:05Anthony Pompliano?

  So like, basically, you're saying it could be, and again, we got to see it play out, but it could be good for the country, bad for the US in some way.

• 17:13Speaker 02

  Yeah, yeah. Who is that? What is the name of that Japanese, like, crazy motherfucker who's the venture capitalist?

• 17:19Anthony Pompliano?

  Masayoshi Son.

• 17:20Speaker 02

  Yeah, yeah. I wonder if like China is a Masayoshi Son of Africa, just like throwing crazy money after.

• 17:26Anthony Pompliano?

  If you create your own money, like, why not?

• 17:29Speaker 02

  I saw this hilarious. That was like, um, there's never been a greater Marxist redistribution effort than Saudi a hundred billion dollars of Saudi oil money going to Basay Osi Shan, who just gives it to like these stupid ideas about, you know, we're gonna like do pet delivery in Antarctica or, you know, just like the craziest ideas.

• 17:48Anthony Pompliano?

  Yeah.

• 17:48Speaker 02

  Yeah.

• 17:49Anthony Pompliano?

  Well, how much of it is you have to fund the dumb ideas to get the breakthroughs as well? Like, you know, when Elon shows up and says, I'm gonna build a reusable rocket. A lot of people weren't like, hey, here's money, right? He wasn't Elon at the time, but, but also there was a hard tech component to it. And I think an aspirational goal, uh, that is different than like food delivery or pet walking or whatever. But still, it feels like you gotta do quite stupid deals to get some of the breakthroughs. Right? Like Airbnb is a good example where, you know, if you're investing in two guys who are like, we're renting out air mattresses in our kitchen. A lot of folks would have been like, that's dumb.

• 18:34Anthony Pompliano?

  But then it's followed up years later and a bunch of venture capitalists funded like, remember Juicearo?

• 18:39Speaker 02

  No.

• 18:40Anthony Pompliano?

  It was like, uh, make juice at home, kind of like a coffee machine, but for juice. And I forget, it raised an ungodly amount of money. And so of course, when it didn't work, all of the critics of the tech industry and Silicon Valley were like, look at these idiotic tech bros funding, you know, a juice machine. Why do you need, you know, a hundred million dollars or 200 million dollars, whatever it was. But it was like, sure. But you would have said the same thing about Airbnb if it didn't work.

• 19:07Speaker 02

  Yes.

• 19:07Anthony Pompliano?

  And so like, it's important that they work because then people look like geniuses, the founders, the investors. If they don't work, then the critics get ammunition and they're like, you guys are morons.

• 19:16Speaker 02

  I, you know, I'd be actually curious about your perspective on this because you actually did invest in Airbnb.

• 19:21Anthony Pompliano?

  What's up, guys? I hope you're enjoying this conversation. Dwar Kesh has an awesome podcast called The Lunar Society. You guys should definitely go into the description. You could subscribe there, both on YouTube and to the audio. All right, let's get back into the conversation and I hope you guys enjoy it.

• 19:33Speaker 02

  One thing I've been wondering about is. If you think about like the stock market versus venture capital, right? The great thing, like the reason I expect stock prices to be like generally correct is you can short a stock. So if it's like too highly valued, some, you know, somebody will come in and like short it and it'll come to its correct fundamental value. With venture capital, there's like, let's say you think that the marginal venture capitalist is making a stupid deal, right? Like you think that this company is super overvalued. There's no way for you to short it and reduce its price to its correct value. So it's like asymmetric in that way. Prices can only increase. It's similar to like housing markets where you can think, you can say like, I think SF's like house prices, maybe in 2020, you're like, I think they're overvalued, right?

• 20:16Speaker 02

  And but there's no way for you to like make profit off that knowledge. And so, yeah, there's like, the market doesn't correct as easily. Is that, would you say that's like a correct characterization of how the VC industry works?

• 20:27Anthony Pompliano?

  So there's correction mechanisms, but they're done in a different way, right? So public stock, let's say that I'm long, it gets overvalued, you're like, hey, it's overvalued, you can short it. And the theory is that it finds kind of the equilibrium price of the market over time. In venture capital, because it's private and they're liquid, people can invest on specific terms. And we've seen it over the last eight, nine months. There can be corrections in the market where companies that raised money at huge valuations that maybe didn't have the financial performance or the growth kind of track record that fit those numbers from, you know, the end of 2021. The next round of funding, somebody may come in and say, hey, I don't think it's worth, you know, 2 billion, I think it's worth a billion.

• 21:11Anthony Pompliano?

  And so there's down rounds, but it's not done in the same way of like, somebody is necessarily profiting off of the cut in valuation from 2 billion to a billion. It's instead that the people who actually are affected, they're affected negatively. It's either the investors who are investing at 2 billion, it's shareholders that were already, you know, equity holders of the business and then employees, right? Who thought that, hey, our equity is worth 2 billion or whatever. Now actually it's only worth a billion. And so it's a correcting mechanism, but it, because there is no liquid market, there's no shorting mechanism. Which is like an interesting, you know, kind of alteration to eventually trying to figure out what is the market price.

• 21:51Speaker 02

  I've got a few friends who work at startups and how given the market. Basically, a lot of their wealth is just in the equity that the startup is giving them. And at this point, it's like, not only is it liquid, but if they sold it in private markets, it would just be worth a lot less. I mean, they're just like sitting like, basically, they're like illiquid for the next few years until like their companies go public or. Yeah, or like the market changes or something.

• 22:16Anthony Pompliano?

  I was talking to a friend recently and he basically was like, I've been trying to figure out how many of my friends made money in tech. I was like, what do you mean? And he was like, think about it. He was like, we happen to know a very wide spectrum of folks. We know people who have been working in the technology industry for a decade plus. And they have made no money. And then we happen to be friends with or know folks who are the single best investors in the world. And they've been absolute killing. But if you were to look at the full aperture of the folks we know in the technology industry. Most of them have not made life changing money compared to the ones who have. Now, the ones who have are well known and it has been explosive, you know, kind of profits.

• 22:59Anthony Pompliano?

  And so the power law takes over and those are the people who everyone points to goes, oh, the cash money you can make in tech. But it probably from an individual participation standpoint, follows a lot of the distributions like venture funds. It's like, I don't forget the exact numbers, but like 50% of venture funds don't make any money. And so if you were to just bring that to employees, like what percentage of employees in the tech industry don't make enough money to retire? More than 50%, like they're still working, right? And so you start to understand, it's just like everything else, like there are people who win, there are people who lose. And everyone points to the extremes. But the actual experience of the everyday kind of average participant in the market is not what the extreme is.

• 23:43Anthony Pompliano?

  And so people forget that because they're holding equity. But I think we've seen over the last nine months, like the correction in the market shows them, maybe I didn't have as much value of this equity that I thought I had.

• 23:53Speaker 02

  Yeah. And I think people also overestimate the upside of. Like working at a start, not necessarily founding a startup, but working at a startup. Like if you think about, let's say you get onboard a startup that is gonna like, gonna grow like gangbusters. I mean, the first challenge is like, you basically have to think like an investor to like even figure out what startup you want to work in.

• 24:12Anthony Pompliano?

  Yes.

• 24:12Speaker 02

  Because what they're paying you in is equity. And how you value that equity is the same way an investor would value that equity, right? So you had to have that skill in the first place, which is like, you had to be a great programmer and you had to know how to value startups in the market. Okay, so you need both those skills. Let's say you have those skills. Okay, and then you're an early employee at a startup, they give you like 0.5% equity or something. Even if you get that, and even the company exits for like a billion dollars, right? Which is like not gonna happen, like a rare kind of thing, a unicorn. Everybody's heard of these companies, so even if you happen to like pick that, then you still exit with like 0.5% equity. You only get $5 million at exit. Whereas if you're that good a programmer or that good an engineer, you could have just like worked for Google for 10 years for the same amount of time who had taken that exit.

• 24:56Speaker 02

  And you could have made like a similar amount of money, so.

• 24:59Anthony Pompliano?

  Or more.

• 24:59Speaker 02

  Yeah, exactly. And that's actually an interesting problem I've heard startup founders talk about, which is, given how much money was flowing around these markets for the last few years. One interesting challenge is, like, listen, you want to hire a second employee, a third employee. These people are not gonna have like the amount of equity that the founders have. So they're obviously, they're obviously gonna be like less motivated to get onboard your company. But like with your third employee, you basically need him to be like a founder quality person, right? You can't just have like some guy who's come, does his eight to five as a third employee or something. But these people are not gonna get the equity that you're getting. So if this person is good enough to start a startup, otherwise you shouldn't hire them.

• 25:40Speaker 02

  So if they're good enough to start a startup, why wouldn't they just like raise their own money to build their own startup?

• 25:45Anthony Pompliano?

  This goes back to a lot of the first five employees, they take founder risk without founder reward, right? And what I've found is the people who are the best second, third, fourth, fifth hire. They know that they're actually not gonna go start a company. So they tend to be younger people who are saying, I want to learn and then eventually one day I'll go start my own company. So it's almost like a apprenticeship slash workhorse, right? And then the second thing I would say is, a lot of the best startups in the world, they basically hired their friends. Right. If you really think, you know, I did an interview with David Sacks and I asked him about PayPal and PayPal Mafia. Yeah, yeah.

• 26:30Anthony Pompliano?

  And I was like, how did you get all of these people? And he's like, well, no one wanted to work for us. So we just hired our friends. Yeah. And it just happened to be they were all, you know, these amazing folks. And so I do think

• 26:42Anthony Pompliano?

  in hindsight, we like to tell these like really sexy stories about like, I knew that person was going to go on and found, you know, an amazing company and it happened to be Chad Hurley who did YouTube. Yeah. And then you find out you're like, uh, no, like literally we needed somebody to program and like, we found the smartest person we could who'd come work for us. And like, it happened to be this person. Yeah. And then they went on and did something amazing. Yeah. And so you have to be careful as to like the hindsight bias of it looks amazing. But there is a kernel of truth of like Max Levchin, Elon Musk and Peter Thiel, who are pretty much the, the people making the hiring decisions very early on, they were great at selecting talent. Right? And that talent just happened to then go start companies and everyone recognized them later on.

• 27:25Anthony Pompliano?

  But these three fellows understood it, you know, on day one.

• 27:30Anthony Pompliano?

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• 28:14Anthony Pompliano?

  LMAX Digital, secure, liquid and trusted. Go learn more at lmaxdigital.com/pomp. Again, that's lmaxdigital.com/pomp.

• 28:24Speaker 02

  And it's a really interesting question of how you spot this talent. This is like something I've been trying to think about. From like initially from the perspective of somebody who was like trying to get opportunities, like in college, trying to figure out, you know, how can it get spotted and stuff like that. But I think this is one of the really interesting challenges. Of how you spot people who have talent. Not only that, you do, you spot people who others haven't already spotted. So you're just like, gonna go to like the Harvard job fair. You know, like, people know these guys are smart, right? So, you know, like, everybody else will be there. You want to spot the people other people don't know could be as valuable as you think. Like, just with the PayPal mafia people, like Joe Lonsdale, you know, wasn't he like just a Stanford student? They, you know, they got a bunch of internships, stuff like that. Yeah.

• 29:06Anthony Pompliano?

  But I think the Harvard job fair is the last place to go look for talent.

• 29:12Speaker 02

  Yeah.

• 29:12Anthony Pompliano?

  Especially in startups. Because if you are at the Harvard job fair, you're looking for a job. Like, like that, like, that's why you're there, right? And so to some degree, like, actually, the better thing to do is to go to the Harvard Computer Science Lab on Friday night at 11:00 PM and see who's there.

• 29:33Speaker 02

  Didn't PayPal actually kind of do, not with Harvard, I think, but like in another university?

• 29:35Anthony Pompliano?

  I'm sure they did.

• 29:36Speaker 02

  I think they basically did something very similar.

• 29:38Anthony Pompliano?

  Yeah. And I think a huge piece of this is like, you're looking for the person who's already doing the job or who already shows a predisposition to being successful in this environment. Not the person who is showing up and looking for, how big is your organization? If I put on my resume, will it look good? How much do I get paid? What's my title? Like, it's just playing a different game. And so what you want is you want people who are worried about the end result, not kind of what it looks like you're doing.

• 30:10Speaker 02

  Yeah.

• 30:11Anthony Pompliano?

  I always think of this as like the, the parent test. Do you, are you hiring somebody who cares what their parents think about their job? Or are you hiring somebody who wants to be able to say to their parents 10 years from now, you know, that thing that you use every day? My team and I built that. And those are two different people, right? Like, there are some people who it's really important that their parents can say to their friends, like, my kid does X, or my kid is a lawyer, or a doctor, or has this big title at some company.

• 30:42Speaker 02

  Yeah.

• 30:43Anthony Pompliano?

  Probably not for, you know, building innovative technology.

• 30:46Speaker 02

  Yeah, no, I think what you said there is really fundamental. I was trying to figure out, there, Colin Newport has this really interesting blog post where he points out.

• 30:57Speaker 02

  Like you can think of, you can like, let's say you can reverse this back to college admissions just to get a sense of how to think about talent. So if you think about a kid in high school, right? One of the kids is, he's like started a business, maybe he has like five figure cash flow. He might even have like a few contract employees. Like, I don't know, he builds websites or, you know, just like doing something. And then you have a kid who's like the president of five clubs and he's on the varsity tennis team and he's, I don't know, like volunteered in any field for the summer. He got a selfie with a shovel. So you think about those two people. Why is it the first one sounds more impressive? It's not because he worked harder, because to be a president in like five clubs or whatever, you gotta be, work pretty hard.

• 31:42Speaker 02

  Maybe he's, it's not even necessarily he's more intelligent, right? Like, again, you said, it's gotta be pretty intelligent to like excel in high school, get all these great SAT scores, whatever. So what is, what is the difference? And he says it has something to do with novelty, that the second, sorry, the first kid, the one who's like started this business, he's doing something original, creative, shows that he has a vision, ambition. I think that's part of it, but I think there's something even more fundamental. If you think about how a call option is valued, right? Like call option being the right to buy something, the right to buy a stock at a predetermined price. So you're basically trying to maximize the upside. If you think about how a call option is valued, what do you care about? Well, you care about the volatility, right? If you have a call option on a stock, you, you might even care more about the volatility

• 32:27Speaker 02

  than its actual current value or its expected value. Because if the stock is moving around all the time in huge, then there's a chance it'll like move up, like you think about like buying a call option on Bitcoin, right? In like 2015 or something. You just care about Bitcoin being super volatile. Cause if it goes to the moon, you have all that upside. And you also want a big time to maturity. So the distance between like where, you know, your current date and like when the call option is exercised. Again, because there's more room for the underlying asset to experience large fluctuations in value. You apply that to talent. You think about the kid who is starting a business in high school. That guy is like way more volatile, right? So buying an option on him is like buying an option on Tesla.

• 33:11Speaker 02

  Buying an option on the second kid is like buying an option on IBM. It's just like, how far up it's gonna go, right? Like the first kid could potentially become the next Patrick Collison. The second kid might work for Patrick Collison.

• 33:22Anthony Pompliano?

  Well, it also goes back to like, in some way, you have to pick the people that violate the societal conformism, right? Like, the more that somebody is conforming to what society thinks you should do, the less likely they are to have volatility, right? Or to have the outlier components or kind of outcomes. And so if you go back and you look at a hell of a lot of people who have ended up being highly successful, they sure didn't fit kind of the normal box. Now, you have to be careful because some people are just weird, right? Or dumb and their ideas literally sound insane because they are insane.

• 33:57Speaker 02

  Yeah.

• 33:59Anthony Pompliano?

  But there's a lot of folks who are outside of kind of that normal framework. And that's where the volatility lies. And so with volatility, it works both directions. It can go up, but it can go down as well. And so to some degree, if you're playing a power law game, which venture capital is, you actually should go make almost all of your bets on highly volatile kind of opportunities because you only need one.

• 34:23Speaker 02

  Yeah, yeah, yeah.

• 34:23Anthony Pompliano?

  Right? Which, again, sounds to the untrained person, oh, you're gambling. But no, it's your understanding the power law. And what you're trying to do is you're trying to find the highest volatility you can find. And if you pick correctly, you end up hitting more and more and more.

• 34:41Speaker 02

  There was this great movie, Hindi movie that I, it's one of my favorites. It's called Once Upon a Time in Mumbai. And it's basically about this like mafia boss. And so then he's like testing out this new recruit. And the guy is just like, he's just like a crook, the new guy. But he's also like really ambitious and really creative. And then, so then he recruits him. And one of his like, I don't know, he's like, basically it's like the mafia boss's like chief of staff is like, that guy doesn't seem straight. That guy seems like all kinds of wicked. And the mafia boss is like, well, we have no room, we have no need for straight people in our business. Yeah, but the dangerous thing is, yes, you want to take these leveraged bets on people. The thing about leverage, you know, you can think of like a 10x engineer as not, not just

• 35:24Speaker 02

  meaning he's like 10x better, but like apply the literal financial definition. So you have like a 3x S and P fund, you can have like 10x levered Tesla. Think about it as like actual financial leverage. That's not always good, right? It's good if you have, if you've made a great bet. If you made a great bet on like a company, you're really sure about your vision, leverage can amplify your returns. But if you've made the wrong bet, you're just going to get liquidated faster. Think about like somebody like Napoleon. So if the, after the revolution, the government in charge of France was a directory and they made a highly leveraged bet in the person of Napoleon, right? So he gave them stupendous returns. Austria, Italy, even like went to Egypt, like fought under the shadows of the

• 36:08Speaker 02

  pyramids. But it was leveraged bet. There's a big downside, one of which is he'll return and he'll get rid of the end of our government and replace it with his own dictatorship. But what kind of person did you think was going to be the one that's going to conquer all of Europe for you? So yeah, I think it's like really potentially rewarding, but potentially very dangerous to hire those kinds of people.

• 36:29Anthony Pompliano?

  Elon said this on SNL. He was like, I'm trying to like save humanity and go to Mars. Like, did you think I'd be normal? Right? Like, I thought I was like, like, that's the most honest thing that I think anyone could say on national television. It's like, no, we shouldn't think that you're normal. And that's why you think that, you know, I saw a clip recently, his birthday is exactly 69 days after 420. And he was like, this is a simulation, right? And it's like, of course, this guy thinks it's hilarious, right? So I, I don't know. It's a, it's a very weird thing. You wrote a piece about miracle years, and I found this fascinating, where a number of great scientists and inventors, they basically had majority of their breakthroughs in a very compressed period of their career. Describe a little bit this idea of like miracle years, and then like, why do you think this is something

• 37:14Anthony Pompliano?

  that plays out?

• 37:15Speaker 02

  No, it's such an interesting, it's such an interesting pattern. Yeah, that piece went like, super viral, more than I was expecting. But it was just one of these interesting patterns you notice in the world. And once you notice them, you can start, kind of start thinking, it makes you maybe shift your perspective on certain things, maybe come up with entire different theories about how to explain different institutions. But yeah, so this is a really interesting pattern in. The careers of scientists, not only scientists, but especially scientists, you see somebody like Isaac Newton, age of 21, pandemic hits Oxford, he's sent home, comes up with theory of gravity, calculus, stress making progress towards optics. It's said that, by the way, he created calculus at the same pace that a college student learns calculus.

• 37:59Anthony Pompliano?

  Wow.

• 37:59Speaker 02

  Yeah, all in one year at the age of 21. Einstein, age of 26, he's like PhD kind of got rejected. He's been sidelined out of an academic career. So he's a patent clerk. As a patent clerk, he comes up, he explains the photoelectric effect, comes up with special relativity, Brownian motion. There was another important paper, I think it was about Avogadro's constant. But anyways, four fundamental results, like super important results in the history of science. 26, one year. And it's not just science. I mean, there's other scientists who've had such miracle years, von Neumann, Gauss, Euler. But you look at the careers, I don't know if you saw the Brandon Sanderson thing.

• 38:40Anthony Pompliano?

  I did not.

• 38:41Speaker 02

  Okay, well, you know, like he's a fantasy, he's a fantasy author, probably the like the biggest fantasy author these days. He, since the pandemic started like two years ago, he announced on YouTube, he's written five extra novels that his fans didn't know he was writing in addition to the ones he, they already knew he was writing. The Kickstarter, to access these novels, he releasing them as a Kickstarter, $40 million.

• 39:04Anthony Pompliano?

  Wow.

• 39:04Speaker 02

  Biggest Kickstarter in history. Okay, anyways, so what is happening here? Why is, why are these people having these extraordinary years where they make progress toward seemingly independent problems in such a short span of time? There's a lot of interesting hypotheses here. One is maybe there's like a brief window in a person's life where they're young enough to have creativity, intelligence, you know, your intelligence kind of declines as you get older, ambition. But also they're like mature enough to kind of understand what's going on in the field. It's similar to what you said with Elon going into these new fields, applying first principles thinking. So maybe there's like a brief window in a person's life where they can do that. And maybe it's like only a couple of years in your entire life, right?

• 39:48Speaker 02

  And if those years you're concentrated, you're able to work on the problem, you're going to make a shit ton of progress. There's other hypotheses you could make. Like, one is maybe just like a super sad story about, let's say you become successful, right? Let's say you win a Nobel Prize. Let's say you become department head or something. Okay, what does that mean? Well, you've got like a bunch of obligations that are sucking over your time, your energy. You gotta like attend conferences, write popside books, just like do interviews. Like, deal with, if you're a department head, you gotta do all this administrative stuff. And that's one thing where like maybe your universities are really fucking up because like maybe even like now the grad students are getting mired up in all this like extracurricular duties. So one thing is just like your success brings obligations that like destroy your capacity

• 40:31Speaker 02

  to do productive work. And yeah, there's a few other interesting, I mean, one thing is that maybe these just problems are just linked with each other. Like, maybe you, the photoelectric effect and special relativity and Brownian motion, they're kind of, you start thinking a certain way and all of these things just fall out. You know, they're like basically the same branch of a tree. But I think it's such an interesting pattern. Like, we really need to better understand this.

• 40:52Anthony Pompliano?

  How much of it is just they went through some event? Like, you just mentioned a pandemic hits, you get ordered to go home. Your thesis gets denied, essentially. And so there's like a negative event that then forces you to refocus or prove people wrong or some effect. Or also, it's focus. Get sent home. Obviously, the last two years with the fantasy writer, right? Sitting at home during the pandemic. Like, I do think there's a lot of weight in today's society to, I break distractions into two buckets. There's like distractions we recognize and then distractions that we don't think of as distractions. And so distractions we recognize were simple.

• 41:36Anthony Pompliano?

  Notifications on your phone, you're bullshitting on, you know, doom scrolling on Twitter, you're watching Netflix. Like, you're doing all these things that you're like, this is mindless activity. I may enjoy it, but like, it's definitely a distraction from productive work, right? Then there's things, which some of you actually mentioned, email, meetings, conferences, like obligations. We don't think of those necessarily as distractions because we think that there's some reason why we're doing it. We've explained to ourselves that it is an obligation and that's why I'm doing it. But if you actually just look at both of those activities as distractions and say, whether I'm doom scrolling or I'm at a conference that I feel obligated to go to.

• 42:15Speaker 02

  Yeah.

• 42:15Anthony Pompliano?

  And you just pull all that away, how much more productivity, how many more breakthroughs could people have in any industry by simply just focusing?

• 42:25Speaker 02

  Yes. Yeah, no, that's such a great point. Like, there's, my friends in tech, some of them are like startup founders, you know, they're like going to this conference here and like grabbing coffee here. And the question is like, what is, what is your purpose on earth right now? Like, what is the thing you're trying to maximize, right? Are you trying to get more users? Or like, let's say with a, if you're like a content creator, you're like trying to get more people to hear your content. You have like a specific target you're trying to achieve. How does like grabbing coffee with a random person fulfill that goal? Not that you shouldn't do it, but you should understand that like, that is not your job, right? That is not the thing you're like put on earth to do at that particular

• 43:06Speaker 02

  moment. Yeah. And I think, I think it's, I think another interesting thing is, I wonder if like, like people listen to a lot of podcasts and audiobooks and stuff like that. I wonder if that, I honestly don't have a good opinion yet of, should I think of that as a distraction? Or should I think of that as, oh, it's helping you think about the world, it's making you more creative, so on. Because I think like a big part of the reason people listen to podcasts, obviously not this one, other podcasts, is like just vicarious, like you vicariously just want to participate in like a conversation like with friends or something.

• 43:40Anthony Pompliano?

  It goes back to like the stoic argument of like, how painful is it to sit by yourself with nothing, right? And I don't know about you, but for me, I put aside intentional time to go for a walk outside and I don't look at my phone. And what I have noticed is like, value per minute on that walk is off the charts compared to any other activity I do. And has nothing to do with what I'm actually doing. Yeah, sure, there's science of your walking, your brain, you know, and all this activity, whatever. But it's actually just like, my nose isn't in this supercomputer in my pocket and trying to figure out, you know, what's going on in the world. And so it goes back to like focus and clarity and

• 44:25Anthony Pompliano?

  all these things. It's just that the incentives and literally the way our brains are wired is to get the dopamine hit.

• 44:32Speaker 02

  Or just think about like, people say they get their best ideas when they're taking a shower. It's not because there's something magical about like water running down your face that makes you more creative. Is that that is the only time in your day that you are not hearing the input of other minds, right? That is the only time in your, for most people, you're driving, you're listening to music, you're listening to podcasts for, you know, you get home, you're on YouTube, blah, blah, blah. You're at work, meetings. How much of your day in like actual minutes is you not consuming the input of other minds?

• 45:03Anthony Pompliano?

  Do you think that many of the scientists, inventors and kind of innovators of the past, they had just so many distractions? They didn't have supercomputers in their pocket, but they had other things that served as distractions? Or do you think they just naturally, given the lack of technology accessibility that we have today? They just had less distractions and therefore could spend more time thinking?

• 45:20Speaker 02

  I think that's gotta be it, right? Like if you, it just like would physically not be possible. You're like walking somewhere, you can't like plug in something in your ears. It just like physically would not be possible to occupy all your time with the input of other minds, right? Or if you're doing it, you have to do it in like a very intentional way of like, I'm going to engage this person in conversation. Yeah, it's almost even interesting to think about like, it's so almost unrelatable. If you actually had to spend some time in a previous era, me having grown up with like these technologies. It's almost like hard to relate to some, I'm just, I would just be very curious about like the day to day of somebody like that.

• 46:00Anthony Pompliano?

  I also wonder how much of the breakthroughs that we've seen in math, science, hard technology in prior years and decades, even centuries, comes from the sheer number of people focused on those problems. Versus now, going back to our conversation earlier, how many of our smartest folks are thinking about other things? Like a great example, how many intelligent people are focused on building Facebook, Instagram, Google, TikTok and like e-commerce sites?

• 46:32Speaker 02

  Yeah.

• 46:33Anthony Pompliano?

  I probably just nailed about, I don't know, 30% of like the, the tech industry, right? Or whatever it is. And again, it's not to say that like, Google search has this amazing mission of like getting people information and like doing all this stuff. But there is a very strong argument that those companies and technologies take talent away from nuclear power or from space exploration or something else. And so it's hard to compare and contrast like which one is like better for humanity. Right? Uh, cause they're different things.

• 47:08Anthony Pompliano?

  But there's definitely something to the fact that like a portion of our smartest people or the people who would have those breakthroughs, they're not working on certain things because they've chosen to work on other things.

• 47:18Speaker 02

  Yeah. I have a hard time thinking about what I should, um, cause I mean, I went to India earlier this year and you know, we get out of the airport and we're, you know, I get in the car and the driver pulls up Google Maps. I'm like, no way that shit works. I'm like the roads in India, like you got these, like half the roads are just filled with people so you can't even drive on them. How, how could this possibly, I think, no, no, it's actually gotten pretty good. It's a, you can actually use this for navigation and basically at least all the big cities and stuff. And you know, this is a technology developed in Silicon Valley by these people who are like, you know, just like hard coders, not working on these hard tech things.

• 47:58Speaker 02

  But now it allows this guy in India to navigate the difficult streets, you know, probably makes us quality of life much better and all kinds of different ways.

• 48:06Anthony Pompliano?

  Helps them make money, economic mobility.

• 48:08Speaker 02

  Exactly. So there's, I think a lot of indirect ways in which big tech is actually really good all around the world, especially around the world. Because if you look at Facebook's revenue for a user in America, what is it like? It's like, wasn't it like $20 per month or something like that? And like India is probably like less than a 10th of that. So they're probably losing money on working in these emerging markets, but American consumers are actually subsidizing them being able to have products for the rest of the world.

• 48:33Anthony Pompliano?

  Yes. So but I don't think that it's a big tech is bad like that. I think that argument other than maybe the most extreme kind of folks that are critics of Silicon Valley believe that. But outside of that, I think everyone realizes like, hey, these companies are net positive for society. And like, how privileged are we to argue about disinformation in the United States when literally these some of these products are the, you know, WhatsApp is the way that the world communicates, you know, in many countries. And so, you know, it's a first world problem, right? But that doesn't mean that the companies behind it or the work they've done are net negative. It just means that nothing is 100%

• 49:15Anthony Pompliano?

  positive, like everything. Hey, there's cars that get in car crashes. Should we not have cars? Like, no, we probably should have cars and make them safer, right? And so it's just, though, that at what point is the incremental engineer that goes to one of those companies, the output or productivity that they provide is not nearly as much as if they went and worked in another industry that maybe doesn't have as many people, or the problem is harder, or can affect more people?

• 49:41Speaker 02

  I think that's a great point. Like, I think once the industry's matured, they get really good at recruiting people. So you know, if you're like, I just graduated computer science. If you're a computer scientist, you know exactly what to do to get a job at Facebook, or Google, or you know, you're just like, you go to the job fair, you give them your resume, you know exactly what you need to do in terms of internships, so you get a job there. Where it's like, if you want to, if you just want to think a customer's like, first principles, he's thinking, what is the most important thing I could be working on? There's not like, an obvious way in which you're like, that the nuclear fusion guy's going to show up to your job fair, right? So I think once these industries get big, companies get big, they're good, really good at recruiting, which means they get more talent because they've gone good at it. Which means that the new industries, like, they don't have the time or the knowledge to actually be able to recruit these people effectively.

• 50:26Speaker 02

  Which if you are that kind of, and also they don't have the prestige, right? Like, there's a certain kind of prestige associated with like working at Google. Or like, I think it's similar with like finance people and like working at like McKinsey or Goldman Sachs. And so if you are one of these small companies, I think one, like, it's very important you develop an edge of, you can't just recruit the same person that like Google knows to recruit. You can't just like be looking at, oh, these guys are like really intelligent and he's like hardworking and he has like good entrances on your resume. Because every other company is looking for the same thing, right? You need some, like with the PayPal mafia, right? You need some unique edge, like the unique way to think about talent that helps you find the people that Google would have ignored or Facebook would have ignored.

• 51:05Speaker 02

  Like one, when people say Harvard is selective, or like Google is selective, it's selective in the sense that they reject a lot of people. But often these are the best people. Often they're optimizing for the wrong thing, like, who is doing this election? It's like some humanities person. People who write college essays know exactly how to game this shit, right? So, yeah, you have to have an edge if you want to beat out these prestigious institutions.

• 51:29Anthony Pompliano?

  Paul Graham talks a lot about, uh, many people have to learn, unlearn what they learned, or like learn to unlearn, right? And it's because, uh, in one of his essays, he talks about people who'd get to Y Combinator and they would say, okay, like, basically what is the test, right? Tell me what, like, how do I do this so that I'm quote-unquote "successful"? He's like, that's the problem. Like, your entire life, you were taught, okay, come to class, take notes, take the test, regurgitate what you learned in class and in your notes on the test. You know, here's your A, move on to the next thing. And you just kept doing that over and over and over again. He goes, but now, like, there is no test, right?

• 52:08Anthony Pompliano?

  It is actually a ambiguous environment where there's multivariate, uh, inputs that you then have to synthesize and figure out the answer. But the answer is not, you know, the teacher or some standardized test is determining the answer. The answer is what do the customers want? And the customers are never changing, you know, kind of target. They can like one thing on day one and they can like something else on day two. They may like different severities. They could actually say, you know what, you both have, you and your competitor have similar products, but price becomes a component. Or maybe it's quality, like, you have to figure all this stuff out. People who are good at school suck in that environment.

• 52:49Anthony Pompliano?

  And so I actually think that the reason why Google and a place like McKinsey or Goldman or whatever becomes so great at recruiting is because they're pulling from the largest pool. Most people do not want to take risk. They do not want to be the outlier and they do not want to go and have failure.

• 53:09Speaker 02

  Yeah.

• 53:10Anthony Pompliano?

  And so what is the quote unquote, safe thing to do? Go work at a place where you can go home and you're not worried about whether they're paying payroll or not. You go home and you tell your parents, hey, I work at Goldman Sachs. Hey, I work at Google, right? And you work on something that is interesting enough because you're in this environment where somebody has told you like, this is the most important thing, or this is a prestigious thing to do. And so like, you're satisfied because you almost don't know anything else. And so one of my favorite things to do is talk to people who are graduating college and like, I want to go be an investment banker. And I'm like, have you ever like, spent time with investment bankers? Like, go. And they're like, oh, I did an internship. I'm like, cool. Tell me about the internship. Like, was it fun?

• 53:54Anthony Pompliano?

  And they're like, well, you know, we like, did like a lot of like happy hour things. And like, it was like, kind of interesting, whatever.

• 53:59Speaker 02

  And that's what your job is going to be, happy hour.

• 54:01Anthony Pompliano?

  I'm like, okay. And then I'll talk to them like a year later and I'll be like, hey, how's it going? And like, this is hard, right? Like, yeah, no shit, it's hard, right? Like, they are going to burn through a bunch of these young people and some people enjoy it and stay and other people churn out. Now, that doesn't mean people shouldn't go into investment banking or anything like that. But what it does mean is that along that path, there's a lot of people who opt out. They thought they wanted one thing and they changed their mind. I think society would be much better off if we made it more normal for people to take bold risk.

• 54:33Speaker 02

  Yeah.

• 54:35Anthony Pompliano?

  The problem is, failure is a negative.

• 54:39Speaker 02

  Yeah.

• 54:40Anthony Pompliano?

  And so most of society looks at it, you tried something, you failed, you're an idiot.

• 54:44Speaker 02

  Yeah.

• 54:44Anthony Pompliano?

  Instead, if we just said, look, everyone's a scientist. Go run experiments. And by the way, if you run an experiment, it's not that you failed, it's that the experiment didn't work. Imagine how much further along we would get and how much quicker we would be able to create progress, innovation and various pieces of technology if everyone was encouraged to try the boldest, craziest ideas they had. And if you quote, quote, failed or the experiment didn't work, it's fine, go again.

• 55:10Speaker 02

  Yeah. This goes back to what you said earlier about. We judge these ideas, some of which didn't work, as bad. When before, they sounded just as crazy or just as good as Airbnb. Afterwards, you know, if Airbnb had failed, we could say like, come on, you're gonna let strangers live in your house? That's stupid. I think that's true of like, a lot of things you could work on, where the difference is just, you know, there is an element of luck, or just like things you learn over time. Where if Airbnb had failed, like, yeah, they'd get, they had like, you know, they had had like, what, like, tens of thousands of dollars in credit card debt? So they'd probably be in like, bankruptcy court or something at this point if Airbnb had failed.

• 55:51Speaker 02

  Yeah, so then you could just like, laugh at them, but there's like, a lot of counterfactual. If you're trying to do something really ambitious, like, in most cases, you'll probably fail, right? You're trying to make that small probability bet, that this thing really explodes. And that, the small probability makes it worth it, but, yeah, then it's, you shouldn't judge people who just ended up on the wrong side of that equation.

• 56:10Anthony Pompliano?

  We, as an entire society, went from the underdogs to the incumbent, right? And I always think about the idea of like, everyone starts out as the underdog, as the competitor, as the upstart, but if you live long enough, you either die, or you become the man, right? So Bill Gates was the kid in the garage trying to disrupt folks. Now, the internet is like, Bill Gates is the evil billionaire, and he's like, gonna microchip everybody, right? And so, when you, when you view that, countries can do that, societies can do that. And if you were to look at the energy around innovation and progress, and kind of taking bold risks, and this experimentation, in a country like Nigeria, and a country like

• 56:55Anthony Pompliano?

  India, or a country like America, it doesn't mean that there's none in America, but it definitely means, because of demographics, because of the, the lack of anything really to lose, there is incredible energy. And so, I, I believe that in the United States, if we can get back to that, the problem is, there used to be one place in the country where that was heavily encouraged, which was Silicon Valley. And people could go there, and you could fail over and over and over again. And no one judged you for it. It was just like, cool. What's the next idea? Like, I don't even want to talk about the other one. Like, what's the next one?

• 57:29Speaker 02

  Yeah.

• 57:30Anthony Pompliano?

  Because all power law, as that gets dispersed around the country, it goes one of two ways, probably. Either one, other places learn that and then we get multiple kind of areas of innovation. Or it disperses and kind of fades away and we just become, you know, the fat cat that is ripe for disruption.

• 57:48Speaker 02

  Right. Um, yeah, the reason that Silicon Valley, it has a spirit is because if you're wrong and you've like publicly criticized a person, you're like, this won't work, right? If you're wrong, it's like really like, uh, um, who, the, who's the founder of Android? What's his name?

• 58:05Anthony Pompliano?

  Andrew, Palmer Lucky.

• 58:06Speaker 02

  Palmer Lucky. Did you see the thing about him going on Jason?

• 58:09Anthony Pompliano?

  Him and Jason, that's gonna, that's the next two decades. That's gonna be the feud is like Palmer Lucky will never let that die. And Jason is also gonna not just let Palmer turn him into a punching bag. So like, they're gonna keep going at it for decades.

• 58:24Speaker 02

  The hilarious thing is he like, Jason tries to keep on like Twitter and on his, he like, tries to like, turn it around by like, saying nice things about Palmer. And every time he does, Palmer just responds in the most brutal way like, but that's, that's the thing, right? Like, if you're like, um, I, I don't want to like judge Jason in particular. I don't know the details. But let's say you're the kind of person who judges someone too harshly, too early. And you're like, oh, this guy's an idiot. This thing's not gonna work. If it does work, you look like a fucking idiot, right? And Silicon Valley, it's Silicon Valley that happens so often that like, people are like really averse to judging people who fail. Yeah. Whereas in the rest of the world, somebody doing something crazy. I was talking to somebody who's a software engineer in the UK. And he was talking, you know, we're at this conference where people were like, had these all kinds of cool ideas.

• 59:05Speaker 02

  He was saying, you know, this was in the UK and somebody came up with like an idea, like, I want to build like a defense startup or something. People would just like laugh him out of the room, right? There's this, there's this like tall poppy syndrome. So I think America is still like conserve that spirit quite well, actually. Even in India, because of the hierarchical like caste system kind of thing. I, I, I think like Bangalore and other places that are like startup hubs, they're, they're probably different. But so similar like how Silicon Valley is different from the rest of America or was. But yeah, I think America is still like surprised like it's like if you're here, it's being a fish in water. But if you go to the rest of the world and you ask people, go to Japan or Singapore or something, how many of you want to start your own business?

• 59:49Speaker 02

  No hands raised. You come to the US and you like just go to a random room. How do you want to start your own business at some point? People might not do it, but they're going to raise their hand, right? So yeah.

• 59:57Anthony Pompliano?

  It's almost like Americans, to some degree, almost have like more arrogance, like everyone raises their hand, but only half of them do it.

• 1:00:03Speaker 02

  Yeah. Have you seen those polls about they look at American kids and Asian kids? And they ask them like, are you better than average at math? And like all the American kids raise their hand. And the Asians are like a quarter raise their hand or something.

• 1:00:18Anthony Pompliano?

  Who's better? Right? But like the generalizations end up having some kernel of truth to it, right? The other thing too about I think American like ambition and innovation is there is a resurgence, I think, where we hit this lull. And now you see a bunch of these companies that are coming up over the last three or four years where they're taking big swings. Remains to be seen whether they'll be successful or not. But I do think that this like almost renaissance to some degree is important, but it's coming from the entrepreneurs, it's coming from the innovators and kind of the scientists and all that. It's not coming from the politicians or the government. And what's fascinating to me

• 1:01:02Anthony Pompliano?

  is that in the mainstream conversation, the conversation has very much shifted in America over the last 50 years to like, what can the government do for them? Right? But there's almost like this little group and you can almost think of it like, you know, there's the general military and then you have like the Navy SEALs. Like we need the Navy SEALs to continue to be ambitious and go do the shit that no one else wants to do. Right? We need this, the select group of startups to be highly ambitious and go try to drive innovation and do the impossible. Because the rest of society is one not going to do it. They don't have the risk appetite to do it. And actually, they're shifting the other way. And there's this rise of, oh, now we're going to get free money. Like, you know, when's the next stimulus bill coming?

• 1:01:42Speaker 02

  Yeah.

• 1:01:42Anthony Pompliano?

  And so I think that it's like a very interesting thing, but it's not a story that's over yet.

• 1:01:48Speaker 02

  Yeah. Um, no, that's the, like, not only does the entrepreneurial part of society have to, like, be powerful, but like, just to keep up with all this redistribution and all this like rents, not even redistribution, but the rent seeking, right? It's the infrastructure bill, like the money in there, it's not like it's getting redistributed. It's just like, who knows where it's going? Um, like, some contractors, like, really wealthy and happy now. But are there any more trains or railroads or bridges that are going to get built? We'll see. Um, there's actually, um, I think that in the 2009 bill for the stimulus in 2009, they had to give like $30 billion to build train tracks in, uh, in the US.

• 1:02:31Speaker 02

  And zero new miles were built. So literally, if you just do the equation, 30 billion divided by zero miles, it costs infinity dollars to build a mile of railroad in America. But yeah, so you, this part, this is like the productive part of society. They're actually building new goods and services. They need to keep growing exponentially just to keep up with the rent seeking from the rest of society. But the optimistic white pill is, since they're growing exponentially, over time, they'll become more and more important. Now, maybe they become entrenched and maybe they become part of the new establishment. But hopefully, like Elon is the wealthiest person in the world right now, right? Hopefully, more and more power goes to these kinds of, you know, people who are like building stuff, doing cool things. I mean, that's a white pill.

• 1:03:12Anthony Pompliano?

  If you think of Elon and Jeff Bezos, right, that those are the two, um, that battle back and forth on the wealthiest person in the world. Like, there's a reason why they're the wealthiest.

• 1:03:22Speaker 02

  Yeah.

• 1:03:23Anthony Pompliano?

  Amazon is an incredible business that I can press a button on my phone and something shows up the next day. Like, that is insane. You probably should be one of the wealthiest people in the world, right? And so I think, uh, If you look at the top, I think it's the top 25 of the Forbes 400, none of them are day traders or like investment types, right? It's all, again, power law. It's the people who built highly innovative products or who are in the family lineage, right? It's like the Walmart family. They end up being, each one of the Walton siblings is up on that list pretty high, but somebody in their family lineage built Walmart, which is similar to an Amazon.

• 1:04:06Speaker 02

  Yeah, no, I think that Walmart is an excellent example of, you know, there was this economist, Thomas Piketty, who wrote this book, Capital in the 21st Century, was hugely influential a few years ago. And the point he was making is over time in societies, what happens is wealthy people will accumulate resources. They'll hand them down to their kids. They'll accumulate resources. And the rate of return to capital, if you think about the S and P growth rate, is higher than the rate at which the price of labor grows. So over time, they will like, this is, it's more and more unequal, more and more hereditary. And he doesn't talk about this, but it's also true that there's like a genetic component to this. Children of wealthier, like more successful people are also likely to be more successful.

• 1:04:47Speaker 02

  And so in that way, like even there's like a genetic endowment that screws things. If you look through history, most of the, there's so often a complete drawdown of wealth because of war, because of revolution, because of some crisis, and then the, either the scales get completely leveled or the resources are redistributed. Interestingly, I think America is the only country in the Western world, maybe the entire world, but the only country where there hasn't been a complete, just like complete drawdown of wealth. You don't just like reset to zero. That hasn't happened in America, which maybe makes us more optimistic, but also more, more maybe not cognizant of like the actual risk that civilization is taking.

• 1:05:30Speaker 02

  But yeah, so but Walmart is actually a great example of this because the the family as a whole is really rich, right? But like each individual a wall tonight is they're not the richest people in the world. The richest people in the world, as you just said, are the people who just like recently made their money, which goes against a pickety thesis. The the

• 1:05:46Anthony Pompliano?

  But is that not in a technology age will then not continue to happen?

• 1:05:49Speaker 02

  Yeah.

• 1:05:49Anthony Pompliano?

  Where because of the rate of change and improvement in technology and the constant reinvention, I mean, if you look, TikTok is now the most popular website in the world. That didn't exist 10 years ago, right? And so because of that occurring, the incumbents are actually at a disadvantage to remain the wealthiest. Now, they're still gonna be rich, right? Or their companies will still be powerful and have a lot of resources. But actually, the advantage is to those who have speed and can continue to reinvent using the new technologies. And just naturally, because of the innovator's dilemma, the incumbents likely don't do that as well as kind of new upstarts.

• 1:06:27Speaker 02

  Yes, I think that's the key. Like, people complain when people complain about wealth inequality, when they say like, the wealthiest 0.1% has so many of the resources. What they're not considering is that 0.1% is changing all the time, right? That would be really concerning in a country where there isn't that level of turnover, like you talked about. I think in Italy, if you look at the wealthiest people in the country in like the 1600s or something, there's some guy did this brilliant study where he's like looking at the last names. And he's like, okay, who are the wealthiest people in Italy today? Who are the wealthiest people in 1600? I think like, most of the top 25 or something, I like literally direct descendants.

• 1:07:04Anthony Pompliano?

  Wow.

• 1:07:05Speaker 02

  So like, from 1600 to now, in a country where there's like no economic growth, basically, one of my friends put it this way, Europe is like a living museum.

• 1:07:15Anthony Pompliano?

  Which is part of the reason why people like to visit.

• 1:07:17Speaker 02

  Right.

• 1:07:18Anthony Pompliano?

  But but if you're going to be in the technology industry, I think there's a lot of people who say, hey, that's a disadvantage than maybe somewhere else.

• 1:07:23Speaker 02

  Yeah.

• 1:07:24Anthony Pompliano?

  You've done a lot of interviews around long termism. What is that concept? Like, why are you so fascinated with it? What's up, guys? I hope you're enjoying this conversation with Dhrakesh. He's got an awesome podcast that I listen to regularly called The Lunar Society. You can go down into the description, click on the link there to either YouTube or the audio. All right, let's get back into the episode. I hope you guys are enjoying it.

• 1:07:43Speaker 02

  Yeah, no, I think this is gonna be the things that we're really gonna start talking about in a few years. And I think this is, this is really interesting and important to think about. You look at

• 1:07:54Speaker 02

  We tend to think about the world like what's gonna happen in 10 years, what's gonna happen in 20 years, what's gonna happen in 50 years. But if you think about like how long civilization could exist, thousands, maybe millions of years, billions of years, right? Civilization could hang around for as long as the universe exists. And it's like 10 to the 500 power years until like all the protons decay away and there's like nothing left. So that gets really abstract if you think that far out. But you just think like, we want civilization to be around in a thousand years, right? We want civilization to be flourishing. We want, you know, we just want all kinds of creative, cool things to happen. Just think about how much the world has changed in like the last thousand years. We've grown so much wealthier, life is so much better. Just think of that process could continue longer. And it's really interesting, you can start to think from first principles, because you

• 1:08:37Speaker 02

  can't just extrapolate trends if you're talking that far out. You really gotta think about first principles of like, what is gonna matter in the long term? It's gonna be things like, if we build through human enhancement or through AI, things that are way smarter than us, that's gonna be a big deal. If we go extinct because of the pathogen, because of nuclear war, because of, you know, other kinds of disruptions, that's gonna be a big deal. Which allows you to ignore, actually, a lot of the day-to-day news. Like, if you look at a newspaper from 100 years ago, how much of the stuff they're talking about actually mattered in the long run? Same thing like if you open to the New York Times. Like, what are the odds that any article there is gonna be something that 100 years from now people are gonna be like, that actually was important to think about at the time? Zero chance, right? So then you start thinking about like, what matters in the long term?

• 1:09:21Speaker 02

  Because if most people are gonna live in the future, and if people are like worth roughly equally as much, most of the value that could potentially exist, exists in the far future. We wanna make sure those people flourish as much as possible. There's all kinds of interesting ideas about how to make sure their lives are good.

• 1:09:35Anthony Pompliano?

  Like, what is that idea? Like, how do you make their lives better today?

• 1:09:40Speaker 02

  Yeah. So, one thing is just making sure civilization doesn't go extinct, right? Like, they can't exist if civilization goes extinct. But there's a big debate, and this is why this field is really interesting to me. There's huge debates about how to make sure that the future goes really well. And the good thing is like, it's not mired in like, politics or anything. People are just thinking from like, first principles. One interesting debate, there's economist Tyler Cowen, who says that, over the long term, the only thing that matters is economic growth. So you wanna maximize economic growth. A really interesting anecdote he gives is... Between 1880 and 1990, if you, if the rate of economic growth in the US had just been 1% lower per year, so you know, like, that's like a normal range of fluctuation, right?

• 1:10:21Speaker 02

  Just 1% lower every single year, the US in 1990 would be as rich as Mexico was in 1990 per capita, right?

• 1:10:29Anthony Pompliano?

  Wow.

• 1:10:30Speaker 02

  So over time, the rate of economic growth is the thing that matters most. But the, so right now, the rate of economic growth is like 2% approximately worldwide, and it's slowing down, which is really concerning. But this is raises an interesting prospect, because if you think about like 2% growth, that's like, the economy's doubling every 35 years. How long can it keep doing that? Like, doubling every 35 years, it can keep doing that for maybe like the next 100 years, maybe the next 200 years. Can it keep doing that for the next 1,000 years? How about the next 10,000 years? Because if you extrapolate 2% growth from our current economy to like 8,000 years from now, that would mean that every single atom in the galaxy had to support as, as much economic value as the entire world has today, right? So, which means that like, probably this rate of growth can't continue for, forever,

• 1:11:14Speaker 02

  which means the, the times that there's a lot of growth, lots of things are changing, lots of new technologies are coming about, lots of new political institutions are coming about, that may be the most important time in history. Because like, that determines what happens in the far future. So we could potentially be living in the most important century in history. And that changes everything about what you think is important to work on.

• 1:11:32Anthony Pompliano?

  Because right now, if we can, one, the economic growth already could potentially make that argument, but if we could increase economic growth through technology and other innovations, then definitely it puts a emphasis on the current moment.

• 1:11:47Speaker 02

  Yes. Or just think about like, let's say we develop AI, right? Full AI. I think there's actually a good chance it happens this century. Like, it would-

• 1:11:55Anthony Pompliano?

  Like, full artificial intelligence, not like, hey, I have a startup and I use the term AI, and like, I don't even know what that means. Which, by the way, there have been people who have pitched me AI startups, and I say, this isn't AI, this is machine learning. And they say, no, it's AI. And I went, okay, how do you do it? And then they just, like, literally textbook description of machine learning.

• 1:12:14Speaker 02

  Like just linear regression or something?

• 1:12:15Anthony Pompliano?

  Like, okay, and by the way, like, I'm not an expert, right? I, you know, I can Google. But like, like, all right. And so like, I do think that this whole thing of like, actual artificial intelligence is what seems to be much further off than I think most people realize.

• 1:12:33Speaker 02

  Yeah, yeah.

• 1:12:34Anthony Pompliano?

  But you think it could happen this century?

• 1:12:35Speaker 02

  Yeah, I think it's actually more likely than not.

• 1:12:37Anthony Pompliano?

  Why?

• 1:12:38Speaker 02

  Because if you just extrapolate the trends in AI, you think about GPT-3, it's able to write like full essays. You think about how much more powerful that is in GPT-2. I think they've raised the parameters by an order of magnitude or something, and it's just so much more powerful. You do that like two or three more times, you raise the order of magnitude. I think the training cost of GPT-3 was like 10 million or something, which is like, you're talking about potentially on the track of building the most powerful technology in history. That's nothing, right? Think about when people start throwing real money at it. The idea that you could just scale a model like GPT-3 to AGI, it's called a scaling hypothesis. The basic idea is you just make this shit bigger. Eventually it'll get smarter and smarter until it's AGI.

• 1:13:21Anthony Pompliano?

  You make what bigger? You make the training sets?

• 1:13:23Speaker 02

  Or just like the amount of parameters in the model.

• 1:13:25Anthony Pompliano?

  Okay.

• 1:13:26Speaker 02

  I actually had a guy on the podcast recently who actually did an estimate of this. You think about the computational capacity of the brain, and you think about how big these models are, or how much computational capacity they use. We're only a couple of orders of magnitude away from actually having enough computation to run, emulate the brain. That doesn't necessarily mean we'll like actually know how to do it. So that's why there's a lot of uncertainty there. But if that happens, like this thing could be seriously smarter than we are. We had to really make sure that it's aligned, it's aligned with our goals. And another interesting thing, like which would make this century really, really impactful, and this I think is a near certainty, is human enhancement of, I just had this guy

• 1:14:08Speaker 02

  on my podcast, it'll be released next week, Steven Shu, he's working on genomic prediction. The basic idea is, it's called embryo selection. You basically do IVF, individual fertilization, you have multiple embryos. You select the one that has the greatest potential to become like really smart, right? You do that over and over again. Over time, you can get like, you can make somebody who's like way smarter than somebody who's ever existed by just selecting for all the genomic sequences.

• 1:14:38Anthony Pompliano?

  Is that controversial to do?

• 1:14:40Speaker 02

  Oh, yeah.

• 1:14:40Anthony Pompliano?

  Why?

• 1:14:42Speaker 02

  Well, the idea is, oh, the people who are going to be afforded this are the rich people. If you do that, then like the rich people will be like get actual genetic entrenched advantage over time. But it's just like, it's not that expensive. Like just give it to everybody for free, right?

• 1:14:56Anthony Pompliano?

  But like the actual act, forget who's doing it for a second, right?

• 1:15:01Anthony Pompliano?

  If we have a human race and our goal is to improve the human experience, right? Or like whatever we're optimizing for is like constantly improved, constantly progress. One huge input is to have intelligent humans

• 1:15:18Speaker 02

  Yes.

• 1:15:19Anthony Pompliano?

  operating in the world. On top of that, you want people who have very specific components, right? Or kind of inputs into it that aren't just intelligence. And so what those are, obviously, there's going to be a debate, right? Who gets to determine? How do we measure? Do we know with certainty? Is it probability? Whatever. But there's some framework that we're like, cool. These people will become more productive members of society. And it feeds back to, I have, I have a friend who will go unnamed, who believes that it is Elon Musk's duty to humanity to have as many children as possible, because he's Elon Musk and we need as much intelligence as possible. And so like, he's a pretty good person to like, put, put some life out there into the world.

• 1:16:04Speaker 02

  He seems to be doing a pretty good job, a good job of making progress.

• 1:16:06Anthony Pompliano?

  He's definitely doing it. I don't know if that's why he's doing it, but he's definitely, you know, he's up to, I think he's in double digit kids, which like, you know, hasn't been seen for a few centuries on average. But if you think about this idea, it's like, okay, I think what makes it controversial people is to your point, one, who's doing it, right? Like the cost barriers. But also too, like, I think it just scares people that like, what you mean that we as humans could have some element of contribution to the increasing intelligence of humanity. Because I, it makes us feel better to almost think like, okay, you know, two people have sex, baby comes out and just like, whatever hap, you know, whatever the combination of these two people.

• 1:16:49Anthony Pompliano?

  And we almost think of it like eye color or hair color or whatever. It is like, let's see.

• 1:16:56Anthony Pompliano?

  But if you gave parents the ability to choose, I don't know how many people would say they'd do it, but I gotta think it's a pretty high percentage of people would say, hey, I do want to pick the baby's eye color. I do want to pick the baby's, you know, hair. I do want to pick, uh, if you give me four embryos, and by the way, we're gonna pick one of the four anyways, right?

• 1:17:17Speaker 02

  Exactly.

• 1:17:18Anthony Pompliano?

  Then don't I want to have some data to pick a embryos that I can optimize for whatever? Maybe it's not intelligence I want to optimize for. Maybe it's literally, hey, there's three that have a high probability of brown hair and one that has blonde hair and I want a blonde haired baby. Like, or the data ends up being pretty important.

• 1:17:35Speaker 02

  Or like, it's not even that. Like, um, the, the thing these companies start off with, um, and they, they like to talk about like, oh, this is the only thing we're ever gonna do, right? We're never gonna talk about intelligence. Um, the thing they start off with is just health. So you look at the diabetes risk of these babies, you look at the heart disease risk, you look at the cancer risk, and you're like, okay, well, I want my kid to be healthy. I'll pick the one that has the least risk of having these things. That's where you start. You can't draw a line there, right? Like, you, you could pick any of these embryos. I just want to pick the one that's gonna be, make sure that my baby is healthy as possible. You, you go down that road, right? Like, health correlates with intelligence. Okay, so why, why don't we just start, start testing for intelligence? Why don't we start testing for, you, you can just go down this road, right? There's also other kinds of interesting technologies, like just cloning. Like, we can clone a fucking horse now, right? We can, we could clone a human. We could do it now, and we have-

• 1:18:19Anthony Pompliano?

  You think so?

• 1:18:20Speaker 02

  Yes. I, it's just like, nobody gives a shit enough. Didn't some, no, this was, in China, they did the CRISPR thing.

• 1:18:26Anthony Pompliano?

  Wait, wait, you gotta back up for a second. People can clone a full-blown horse?

• 1:18:30Speaker 02

  Yep.

• 1:18:30Anthony Pompliano?

  How does that work?

• 1:18:31Speaker 02

  Oh, I mean, uh-

• 1:18:33Anthony Pompliano?

  Like, I take like a 3D image of the horse and then I like 3D print the horse? Like, like, how does this work?

• 1:18:39Speaker 02

  I don't remember the exact details, but it, it, it's like, it still has a gestate in like-

• 1:18:43Anthony Pompliano?

  Okay, so it's basically somehow take the like-

• 1:18:45Speaker 02

  DNA.

• 1:18:46Anthony Pompliano?

  The, the DNA makeup of the horse, it still goes through kind of a birthing process or whatever, and then it becomes essentially the same exact horse. So this is more of genetic,

• 1:18:56Anthony Pompliano?

  uh, kind of science than it is, uh, some sort of like-

• 1:18:59Speaker 02

  Oh, no, it's not like Star Trek.

• 1:19:02Anthony Pompliano?

  Yeah, I was like, all right, I have not seen that. I gotta go do some more research. All right. And so your whole idea is like, we could do the same exact thing because it's just genetics. We could do it for a human.

• 1:19:12Speaker 02

  Yeah, no, this guy wrote a really interesting blog post about, you know, John von Neumann was this like brilliant scientist in the 20th century. The literal, probably the most brilliant people who's a person who's ever lived that we know of, right? So he probably had an IQ of 180. He like, there's so many like stories of him, uh, just like he'll come. People are working on problem for a week. Oh, no, there's a great example of this where he shows up late to a lecture. And a professor is like writing down a theorem on the board and he doesn't realize that he's writing, uh, he missed the introduction where the professor was explaining that like, he's trying to prove the theorem or explain it. So von Neumann, just like, he just like fills in the rest of the steps of the thing that the professor hadn't proved yet.

• 1:19:57Speaker 02

  He just like proves the theorem that the professor was trying to explain the introduction to. But no, the, the, he's, he worked on so many, like nuclear ballistics. He worked like, he developed so many advances in like computer hardware and quantum mechanics, quantum, uh, like all kinds of things, right? This guy was like the most brilliant person who ever lived. His body is in a cemetery in Princeton. You dig that up, you take a little sample, you have this DNA, you do get it sequenced, then you clone him maybe a couple of million times.

• 1:20:26Anthony Pompliano?

  Why don't we do that?

• 1:20:27Speaker 02

  All right. That's what I'm saying.

• 1:20:29Anthony Pompliano?

  But like, what, like, what, do you know what the argument against it is?

• 1:20:32Speaker 02

  I mean, it's probably illegal in the US at least.

• 1:20:35Anthony Pompliano?

  Yeah, but, but like, what, why?

• 1:20:37Speaker 02

  I, I actually heard the story about like this guy who's, he's like a math prodigy, uh, prodigy. And he was like just emailing every single scientist, uh, like he knew about, like, uh, he was like, we know where the body is, why don't we just go dig it up and like clone him? And, um, uh, yeah, so people have this idea. I, I don't like, it just like.

• 1:20:58Anthony Pompliano?

  Is it just an ethics thing? But so this is like a weird thing, right? Like there's, there are what I would consider morals, right? Do not steal, do not cheat, do not like these things that, uh, I think most humans through most of history have bought into and said like, yes, for whatever reason. And whether you agree or not, we have collectively agreed that like, these are bad things to do. And those morals, I think are important because they keep the fabric of society together. They give people a framework on how to act. And, you know, obviously, I don't think anyone really wants to live in a society where it's like, uh, uh, the purge. Like, just like, go crazy, steal things, kill people, like, you know, every person for themselves. Like, that doesn't seem to be super attractive to folks.

• 1:21:40Anthony Pompliano?

  But then there's this like, element of ethics, which like, I'm not clear as to why it is a bad idea to go find the smartest fucking person that's ever lived in the world and take their DNA and try to recreate that over and over and over again, so that we can solve some of our hardest problems.

• 1:22:02Speaker 02

  These people matter a lot, right? Like, we cloned Elon Musk. The thing with him having kids is there's a lot of regression to the mean. So his kids are probably not going to be as good as he was. Just because, just the same way it's like Einstein's kids weren't as good as he was. It just like, it's very hard to keep that. But if it's an exact clone of you, then it's a different story, right? You're thinking about how much value Elon Musk has created for the world. Make a bunch of copies of him. You know, like, we could have so much more. Yeah, so I think, um, are people just scared? Like, does that just scare the shit out of people? And so naturally, it's like, oh, we can't do that, that's bad. Like, it violates our ethics, like, that's illegal.

• 1:22:35Anthony Pompliano?

  Right.

• 1:22:36Speaker 02

  And then in 100 years, people will be like, look how stupid these humans were who created laws. It was illegal to do this. Like, if you go back and you look at laws that were written 100 years ago, uh, many times, they've now been repealed or changed or whatever. We laugh at them, right? We're like, that was illegal? Like, that's what we all do today.

• 1:22:55Anthony Pompliano?

  I think, and the thing is, even if we ban it, like, China's gonna do it, somebody else is gonna do it. China don't give a fuck. They gotta go find, they gotta go find the absolute smartest people they can. They don't care if they're Chinese or any other nationality or ethnicity. And they are going to do everything they possibly can to get geniuses.

• 1:23:13Speaker 02

  Yeah, and that's a huge advantage. Like, if you think about who really, like, military tech, for example, or like, just advances in physics, hardware, whatever. You need the smartest people, right? And there's not that. So many of them around. If you have more of them, you have a huge advantage.

• 1:23:28Anthony Pompliano?

  Does this also play out, not just with intelligence, but like, for example, is the Chinese military going to create like Herculean looking cyborgs that all of a sudden we're like, damn, our humans aren't made like that. And it's because they are using some sort of technology that maybe from an ethical standpoint, the US, whether rightfully or wrongfully, has decided we're not willing to use and they are?

• 1:23:51Speaker 02

  Yeah, I think we're going to see some really wild shit in the near future. Like, I think there's two paths of the future. One is you have this human enhancement path. And so then the most powerful people in the world are these like enhanced, like just crazy, crazy alterations of these people. And these people are like way smarter, way more capable. And the other path is you just go completely artificial. You have an artificial general intelligence. One of these two things I think is likely to happen by the end of century. And when you take that seriously, I mean, there's also kinds of other interesting trends that I think will happen this century. I think we might have energy super abundance. Energy is like super fucking cheap. You can just travel from any point in the world to any other point in like a matter of minutes.

• 1:24:31Anthony Pompliano?

  Why is it going to get so cheap?

• 1:24:33Speaker 02

  So like solar and wind are getting like, if you've seen the curves of the price on those, they just like drop exponentially. There's the prospect that nuclear could be much better. If you know about like the regulations, you know that it's been hamstrung for decades. If you get rid of that, you know, like nuclear could be way cheaper and way better.

• 1:24:53Anthony Pompliano?

  That's another like fake ethical thing, it seems like.

• 1:24:56Speaker 02

  The thing with the ethics stuff is you have, during COVID, you had these bioethicists who were going to do, people had the idea you could do human challenge trials. Whereas you give somebody the vaccine, we had the vaccine before the virus even entered America. They had designed the vaccine. So, so, but it took till November, December. We had to fast track it and it still took us a year to approve the vaccine, right? So these people had the idea, okay, the way the current process works is you give somebody the vaccine. If they happen to encounter COVID and they averted, then you know that the thing works, right? The idea was you, you give these people the vaccine as early as possible, then you inject them with COVID. And if they're able to avoid Covid or don't have the symptoms, you know the vaccine works. These people volunteer to do this, they're getting paid to do it.

• 1:25:39Speaker 02

  It's all, you know, it's all full disclosure and transparency. It would have sped up the vaccine by many months, would have saved more than 300,000 lives. So yeah, we were planning on, this is something we could have done. But then the bioethicists were like, no, this is unethical. And I'm an expert on ethics, so I can tell you that this is unethical.

• 1:26:00Anthony Pompliano?

  What the fuck does that mean?

• 1:26:01Speaker 02

  Exactly, right? I get like, you're an expert in like the, the proteins that make up the vaccine. I get you could be like an actual expert in biology. What is, what does it mean to be an expert in ethics?

• 1:26:12Anthony Pompliano?

  I would argue you can't even be an expert in biology. You can be one of the best first people on what we currently understand about biology. But like, we sure as hell understand less than the things that we don't understand.

• 1:26:24Speaker 02

  Right.

• 1:26:24Anthony Pompliano?

  Right? And so like, sure, we'll call that expertise for now. But on ethics, uh, it just feels like it, it's made up. I want to stop shy of saying it's made up because there are like morals. Again, right? Like, like there's things that I think as a society, we all agree. Like do not cheat, do not steal, all that. But ethics has become this like catchall for just like anything that we think we could complain about. Goes in like the ethics bucket. And so for example, if you have consenting adults who say, hey, I'm willing to do this. I understand the risks and I'm signing whatever. I'm a young, healthy person, you know, yada, whatever. And somebody comes in and says, that's unethical? Like fuck you, right?

• 1:27:09Anthony Pompliano?

  Why do you get to tell somebody what they can do with their body? Now it all of a sudden it starts entering into like the whole conversation around like, wait a minute. Shouldn't you be able to do whatever you want to do? And this gets out like, well, you can't go shoot up heroin. Well, people still fucking do it and I don't see anyone being like, you know, that's unethical. Right? Like I'm, I'm a bioethicist and you shouldn't be allowed to do that. No, they make a legal argument. And so it is this very weird thing where I think our, uh, we've tricked ourselves as a society, specifically in America, that there are certain things in science, math and technology that are off limits.

• 1:27:52Anthony Pompliano?

  Which means that we are not doing science. If things are off limits from an experimentation standpoint, again, there's the right way to do it. There, there's opting in, there's consent, there's all this stuff. But if people are willing to do it and we say, you're not allowed to do that. Or we say, um, uh, that is unethical. What's the difference between science and religion?

• 1:28:15Speaker 02

  Yeah. And I think a lot of this ethics stuff is just that, you know, people have different intuitions. I get that, right? Like some people, they personally wouldn't want like to do, go through this experiment. That's totally fine. People have like intuitions about, I don't know, technology or whatever, right? And so they're like, I don't like that. But if you say, I don't like that, you can't get people, you can't get like power to take your side. You can't get the government to take your side. But if you make the argument, no, no, no, this is unethical, right? Then that's like a political formula. That's a thing that you can go to the government and say, it's unethical, therefore we should regulate it.

• 1:28:46Anthony Pompliano?

  An expert in ethics, by the way, makes me think of like somebody saying, uh, I'm an expert in opinions. Like, what does that mean?

• 1:28:54Speaker 02

  Yeah, yeah.

• 1:28:55Anthony Pompliano?

  And then it also, I think a step further is like, as a society, we need certain people to do shit that everyone doesn't want to do.

• 1:29:01Speaker 02

  Yep.

• 1:29:02Anthony Pompliano?

  Like the reason why we have a safe country for the most part is because there are badass men who are willing to go in the dark of night and kill people in other worlds.

• 1:29:11Speaker 02

  Right.

• 1:29:12Anthony Pompliano?

  Guess what? Nobody likes talking about it, but I don't want to go do that shit. You don't want to go do that shit. And 99.9% of Americans don't want to go do that shit.

• 1:29:20Speaker 02

  Right.

• 1:29:20Anthony Pompliano?

  But we got some bad motherfuckers that'll go do it for us.

• 1:29:23Speaker 02

  Yeah.

• 1:29:23Anthony Pompliano?

  And guess what? We celebrate them. We do it in this weird way where it's like, oh, you're, you're a Navy SEAL. That sounds courageous. But like, when you really look at like what they're doing on a day to day basis, it's nasty shit.

• 1:29:36Speaker 02

  Yeah, yeah, yeah.

• 1:29:37Anthony Pompliano?

  There has to be in a bunch of other fields, like what's the equivalent of the group of people who are willing to dedicate their lives to do certain things for some higher cause that the average citizen doesn't want to do, but they're willing to do it.

• 1:29:52Speaker 02

  Yeah. I think just the entire world is made up of these kinds of people. I mean, I don't know, it feels squirrely to be a programmer, be a kind of creator or something, and you realize that the building you're sitting in was made by people working at way lower wages than you, doing much harder work than you, right? It's like, often these are like illegal immigrants or people who don't even have like, who don't even have basic legal protections and stuff. That's who is, basically build a civilization around you. Just think of like the guy who collects your garbage, the guy who's making sure power is running to your house. So much of the civilization is just like this API, this interface you're connecting to, and it required so much hard work. It's like astounding when you think like, everything, like, think about a package you have

• 1:30:37Speaker 02

  and you're like trying to get it to the other side of the country, just like traveling to the other side of the country. You can't connect to any corporations, you can't connect to any government utility or anything. You just had to do it yourself. It would take you months, years, you would die on the way, right? The, yeah, I think-

• 1:30:50Anthony Pompliano?

  People used to do it, right? Like, take the horse and carriage, like, we're going west. And it literally took months and they had a very high probability of dying.

• 1:30:58Speaker 02

  Right, exactly.

• 1:30:59Anthony Pompliano?

  Now, obviously, with certain advancements in technology, you're unlikely to die, but it sure would still take a long time to do it, even with a car.

• 1:31:07Speaker 02

  Yeah, yeah, yeah. And I think we also underestimate how much, like, when we think about history, we often think in terms of these activist movements, or we think in terms of these political changes that have improved lives. And so the vision of history we have is very much like 1776, 1865, 1965, you know, like, this political movement, this activist movement. I think the real history of, the real understanding of history would also include, maybe it would be more important to include, just like technological changes. If you think about, we had the Green Revolution in the 20th century. If you, Norman Borlaugh was a guy who created a variety of wheat that was more resistant to, it was like more productive, many times more productive than the one before.

• 1:31:48Speaker 02

  And basically, that was the thing that prevented like hundreds of millions of people potentially from dying in India and countries like that. It said that he probably saved a billion lives.

• 1:31:56Anthony Pompliano?

  Wow.

• 1:31:57Speaker 02

  Or think about the Haber-Bosch process for nitrogen fixation, which is used to make fertilizer. Without fertilizer- That has nitrogen, like crops could not grow to anywhere near the capacity they grow in how there would be, uh, land would not be as productive agriculturally speaking at all. There's an estimate that they allowed 3.2 billion people to live that would not otherwise exist. So billions of people, just like these technologies you talked about, um, we don't include, nobody knows about these people's names, right? They're probably the greatest people who ever lived in terms of you thinking about their impact. Um, and they're not included in our history.

• 1:32:31Anthony Pompliano?

  There's one person, one person, a thousand years that will be known that lives today.

• 1:32:37Speaker 02

  Satoshi?

• 1:32:38Anthony Pompliano?

  No.

• 1:32:38Speaker 02

  Okay.

• 1:32:39Anthony Pompliano?

  Elon Musk.

• 1:32:40Speaker 02

  Ah.

• 1:32:40Anthony Pompliano?

  And it's not a guarantee yet.

• 1:32:42Speaker 02

  Yeah.

• 1:32:43Anthony Pompliano?

  He has to get us to Mars.

• 1:32:44Speaker 02

  Yep.

• 1:32:45Anthony Pompliano?

  If he, if he figures out Mars, he lives forever in the, in the minds of a kid born a thousand years from now.

• 1:32:52Speaker 02

  You think, you think we'll be able to get there by 2030?

• 1:32:56Anthony Pompliano?

  The timeline's really hard. I think that, uh, I think SpaceX will get a vehicle or something to Mars.

• 1:33:07Anthony Pompliano?

  I question, will we get a human on to the, the surface of Mars?

• 1:33:17Anthony Pompliano?

  I don't know, the next 20 or 30 years, that one's like a tough one. Now, they believe it's going to be in the next eight years, which like would be fucking, like actually the eight year part of that prediction is crazier to me than like get to Mars. Cause it feels like getting to Mars is the foregone conclusion at this point.

• 1:33:35Speaker 02

  Yeah.

• 1:33:35Anthony Pompliano?

  It's the timeframe that would be mind blowing.

• 1:33:38Speaker 02

  I'm not even sure it's a foregone conclusion. Like we could have.

• 1:33:41Anthony Pompliano?

  You don't think we'll get to Mars?

• 1:33:42Speaker 02

  Or I don't know if it's like, if not for Elon Musk, I think it could like, could have taken decades more potentially it never happened.

• 1:33:48Anthony Pompliano?

  Oh, I don't, I don't think, unless somebody else like him came along, I don't think it was ever even, the people, the thing he did was he allowed people to even think it was possible.

• 1:33:56Speaker 02

  Yeah, yeah.

• 1:33:57Anthony Pompliano?

  Right?

• 1:33:57Speaker 02

  Yeah.

• 1:33:57Anthony Pompliano?

  And. There's still a lot of people who are like, why do you think it's possible? Cause this dude said it, right? Like, like, I don't know. He seems to be the expert, right? And so like, if he says it's possible, then it must be possible. And it kind of goes back to like, um, uh, venture capital due diligence. Like, there's some people who do the due diligence and there's other people who say like, who's investing? Oh, uh, you know, X firm. All right, cool. They must've done the due diligence.

• 1:34:21Speaker 02

  Right.

• 1:34:22Anthony Pompliano?

  The problem here is that like, I don't have the, uh, the scientific expertise or knowledge to actually underwrite, is it possible or is it not? So like, to some degree, expertise, uh, is important because we can look to folks, right? Like, imagine if every single one of us had to go, uh, and learn about a virus, a vaccine, like all this stuff. And then come to a conclusion as to like, what we should do. And then we all took like a democratic vote. Like, that sounds like a nightmare. By the way, that's what DAOs are.

• 1:34:55Anthony Pompliano?

  In his curve. Uh, but if you think about, um, kind of like Mars, it's like, yeah, I do think that we will get there. I just, eight years is, you know, seven and a half years, right? Seems impossible, right? Like, it really does. Like, it is hard to think that way. Uh, but I guess if you look back, I mean, how many flights? Or how many launches per year was SpaceX doing seven and a half years ago? One? Maybe? I don't know the numbers, right? But like, they weren't doing one like every three days or whatever they're doing, you know, like, the rate of progress there is so incredible that like, sure, maybe.

• 1:35:38Speaker 02

  Yeah, yeah. No, it's crazy. He's an excellent example of one person's vision can have a huge counterfactual impact. I think after he founded PayPal, there was like, he immediately, it wasn't like he was gonna like take a respite or anything. He immediately started working on like Tesla. He had like plans for that immediately. Um, he'd like, yeah, it is astounding when you have a person who's like able to actually make their.

• 1:36:01Anthony Pompliano?

  But think back a thousand years.

• 1:36:03Speaker 02

  Mm-hmm.

• 1:36:04Anthony Pompliano?

  We couldn't name anyone. We don't fucking know anybody.

• 1:36:10Anthony Pompliano?

  Like, literally no one.

• 1:36:13Speaker 02

  Yeah.

• 1:36:13Anthony Pompliano?

  And guess what? They thought they were important. They thought their, you know, contributions to society were essential. There's somebody who thought they were the leader of, you know, the free world or whatever. Nobody remembers their names. We, over the history of Earth, I don't know, 500 people, maybe, that we can think of that were like, okay, these people are really important. But the further you get away from their inventions, the less important they become.

• 1:36:46Speaker 02

  Yeah. I think it's also another example of the power law you're talking about, the mentor, where if you think about impact on literature and who we remember, Shakespeare is like way up here. He's like, he's like the Tesla of literature. And then the next person is like probably less than half as important as them in terms of literature. And then you have just this long tail of people who are like, I'm gonna be a great author. And nobody will ever remember your name.

• 1:37:05Anthony Pompliano?

  Yeah.

• 1:37:05Speaker 02

  Yeah. Or true of philosophers, true of like leaders, world leaders, the person who matters the most is going to matter so much more than everybody else combined.

• 1:37:14Anthony Pompliano?

  Also, if things continue the way that they are going, when we talk about human enhancement, I was thinking to myself, if you walked out on the street in middle America, anywhere kind of outside of a tech industry, kind of hub, and you said, there's this thing called human enhancement, we have option A and option B. Option A is we can make you super intelligent. Or option B is we can make you ripped with a six pack and like huge biceps.

• 1:37:42Speaker 02

  Yeah.

• 1:37:43Anthony Pompliano?

  What percentage of people would pick super intelligence? And what percentage would pick like visual enhancement?

• 1:37:49Speaker 02

  Well, what do you, what do you think? Cause I have, I have a friend, we debate this all the time. And he thinks, cause I'm like, okay, everybody's gonna be super intelligent. Cause it's like, all the parents are gonna be like, I want my kid to be.

• 1:37:56Anthony Pompliano?

  No, they want a six pack.

• 1:37:57Speaker 02

  Exactly.

• 1:37:58Anthony Pompliano?

  They wanna go, they wanna go hook up with people. Like, that's what they want. They want the six pack. Like, that's the problem. Is that like, that is human nature, right? He's not like, let me be super intelligent and like change the trajectory of my family. And like, oh shit, no, they're like, cool, if I have a six pack and I go to the beach, like, maybe I could find somebody that like will wanna sleep with me.

• 1:38:15Speaker 02

  Yeah. But the crazy, like, this is like, I know the almost.

• 1:38:22Speaker 02

  Thing you don't want to admit, the thing is, intelligence is actually correlated with a lot of things. Like, intelligence and good looks are correlated.

• 1:38:29Anthony Pompliano?

  Well, explain that more.

• 1:38:29Speaker 02

  Which is, if you think about, the most intelligent people are usually better looking than people, like, on average, right? And the reason is, one of the reasons, I mean, there's mutational load and there's other kinds of things. One of the funny reasons is, the most beautiful woman mate with the most intelligent men. Or just like, people who are very competent in getting something done, they were successful. Successful people on average are more intelligent. They get the most beautiful woman, you know what I mean? Like, that kind of, so you're gonna see, I think, and also the most intelligent woman also mate with the most intelligent.

• 1:38:58Anthony Pompliano?

  There's like attrition.

• 1:38:58Speaker 02

  Yeah, exactly. And that's one of the-

• 1:39:00Anthony Pompliano?

  So, isn't nature already doing what we were talking about earlier? In terms of picking the embryo, like, the advantageous embryos?

• 1:39:06Speaker 02

  Yeah, yeah. Or, I mean, there's a dysgenic effect, because they're not having as many kids. So, in the sense, nature is not picking, nature is segregating them, but nature is actually preferring the, like, on average, this is like, you know, basic common sense, we know that smart people have fewer babies than, like, college graduates have fewer babies than, you know, high school dropouts or something.

• 1:39:26Anthony Pompliano?

  Why do you think that is? Like, what's driving that?

• 1:39:28Speaker 02

  That's really, that's, I think, an interesting question, because you see a broader, you see this throughout, not just our society, but throughout the world, like, the societies that are poorer have more kids. As societies get wealthier, their fertility, like, drops off a cliff. I don't think we have a good answer to that. And I think, over the long term, it's gonna have a big, unless you get, obviously, if we already have AGI, who cares about the average intelligence, right? Or if we have human enhancement, the dysgenic effect is not gonna be that important. But if that doesn't happen, I think the dysgenic effect is gonna be like, by the end of the century, we'll be like, two or three, a little over three IQ points dumber, on average, than we are now. Which doesn't sound like a lot, because the average is 100. But a small difference at the mean has a huge impact on the tails. So, the number of people who have, like, an IQ above 130 will get, like, cut by more than half. Especially when the population itself is declining, right?

• 1:40:13Speaker 02

  So, yeah, I think that's a, that's the thing to think about.

• 1:40:16Anthony Pompliano?

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• 1:41:01Anthony Pompliano?

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• 1:41:45Anthony Pompliano?

  or just like they're uncomfortable? Like, will they just get left in the dust?

• 1:41:49Speaker 02

  Yeah.

• 1:41:49Anthony Pompliano?

  Or like, like, what, like, how does this work? Or do we get to a point where they're like, yo, everyone has to do this?

• 1:41:55Speaker 02

  We'll just make like separate reservations for them. They can like live as, live as noble savages.

• 1:42:00Anthony Pompliano?

  It's a very crazy thing to think about where if, uh, let's say it was a cost thing, right? Should the government say, if you don't have the money to enhance your intelligence, then like, we're going to help you do that. Like, that's going to become a conversation 100%. At the same time, do the people who aren't opting in with their own money, like, you're not putting that chip in my brain and like, I don't want to participate because my government's telling me to do it?

• 1:42:29Speaker 02

  Yeah, I think, I think. It'll be interesting. There obviously will be a lot of people who reject working with that kind of stuff. I think probably the reality is that they're not going to be that economically or politically important. The opposite hypothesis is that, oh, they're going to be like, they're going to be a minority of economic value, like mostly the economic market value is going to generate people who have been enhanced, but they're going to still have, if it's still a democracy, then they're still going to have a lot of political power. If they have political power, they can just like, I don't know, make it illegal or something. But the difficulty is like, how do you make it illegal? Somebody can just get a visa to go to Panama or Singapore. It's like some country which allows it. You go do medical tourism. You're actually making it more difficult for, that means that the elite people can still do it, right? They can just take a trip. But the middle-class

• 1:43:14Speaker 02

  people who could have actually done it, they might not be able to. So if you just like add regulations, you might actually be making inequality worse. I think redistribution, genetic redistribution in terms of just giving you these services, I think is probably going to be the answer.

• 1:43:28Anthony Pompliano?

  Have you heard, this is going to be a crazy thing that, I don't know why I know this. Have you heard of the Brazilian butt lift? You know what this is?

• 1:43:35Speaker 02

  Is it like the thing that Kim Kardashian has?

• 1:43:38Anthony Pompliano?

  I'm sure she has it, right? But basically, it's a surgical procedure, which I'm not an expert on, unfortunately. But they basically enhance your butt by doing some sort of like butt lift. And I believe that it is, they put some sort of like a breast implant or something, right? But in the butt. The reason why I know what a Brazilian butt lift is, is because one day I was doom scrolling on Twitter, wasting time, and I saw a photo. And it was in the Atlanta airport. And somebody had taken a photo and said something to the effect of like, man, these BBLs are really out of control. And I was like, what the hell is a BBL, right? And it was literally, in the photo was just a line of wheelchairs of

• 1:44:23Anthony Pompliano?

  all like, women, maybe between the ages of, again, I'm guessing from the photo, but like, maybe like 25 and like 40. And I was like, What's going on in Atlanta, right? Like, what's a BBL? I Google whatever. Probably got targeted with a million ads of like some dude Googling BBL. And one of the things was that there's been an explosion of medical tourism. I'll put it under the category of people leaving the United States, going to, I forget, one of the countries in Latin America to get these done. And then they come back. But once you get it done, you can't walk very well. So they need the

• 1:45:01Speaker 02

  In the beginning.

• 1:45:03Anthony Pompliano?

  They ran into a medical procedure, right? And so what the photo was, was a bunch of people coming back who were now in a long line of wheelchairs because they all had gone and like from this country and gotten these BBLs. And so I just remember sitting myself thinking like, holy shit. Like this human enhancement stuff is already here to some degree. We think of it as cosmetic, right? Whether people agree with it, don't agree with it, whatever. It's obviously happening. But like, that's what people are interested in.

• 1:45:31Speaker 02

  Yeah.

• 1:45:32Anthony Pompliano?

  And so like, what's the difference between a BBL where you have to fly out of the country to go get it done to, hey, I want to go get a brain computer interface?

• 1:45:40Speaker 02

  Yeah. I, I wonder how common those are. Cause I, I don't know, just walking around Miami, I might've seen a few of them. With that, or the girls are just gifted, but.

• 1:45:49Anthony Pompliano?

  It goes, it goes back to, uh, society evolves, that there's change that happens. And what is aspirational or what is, uh, kind of celebrated is emulated through a society, right? And this has been true of human nature for thousands and thousands of years. But that's usually physical. So what clothes you wear, how you look, right? Actions you do, like all that stuff. Intelligence is this weird thing. It's invisible.

• 1:46:20Speaker 02

  Yeah.

• 1:46:20Anthony Pompliano?

  You know it when you interact with it and you have heard rumors or somebody can tell you, oh, that person is very smart. Or you assume because somebody accomplished something that they are intelligent, but you can't actually feel it. You can't see it. You can't, you know, whatever. I think that that's a huge issue as to why, when it comes to human enhancement, people won't opt for that.

• 1:46:43Speaker 02

  Yeah.

• 1:46:44Anthony Pompliano?

  You can't flex your intelligence on Instagram.

• 1:46:47Speaker 02

  Yep, yep, I think you're right. No, I think intelligence is one of the things where we have a difficulty talking about it because we don't want to admit that it's a big part of it's inherited. And then there's actual difference, genetic differences between individuals. Whereas, you know, people know that people look different, right? Like there's differences in height, there's differences even in health genetically. But I think we're going to have to face the biological reality of intelligence when modifying it biologically is going to be possible.

• 1:47:16Anthony Pompliano?

  Well, it already is possible to some degree, right? And one of the fascinating debates right now is around like Ritalin or like ADHD, like all this stuff. And it's well documented that like, when I was in school, ADHD was not like a popular thing. Now it's like every kid has ADHD, let's drug them all up.

• 1:47:35Speaker 02

  Every adult has ADHD, apparently. Every adult apparently has ADHD too.

• 1:47:38Anthony Pompliano?

  Yeah. And so like, why is it okay for us to like stuff pills down kids throats, right? And like get them drugged up versus, hey, let's put a computer to make you more intelligent? Like, it feels, both are going in your body. Yeah, sure, one you digest, one is more of like a surgical procedure. So like there's a severity difference. But it sure seems like it's probably safer in the end state to do the surgery than to keep like putting pills in our children and drugging them up.

• 1:48:09Speaker 02

  Yeah, especially because those are just transient benefits, right? Like you get rid of the drug, you might even be worse off because you've built up tolerance or something. And I don't think, there is difficult, I don't think a drug will ever be able to like make you smarter. Maybe just like, those are just sort of stimulants to help you focus, right? But to make you smarter, yeah, it should change the architecture of the brain. And that's not going to be an easy thing to do after your brain is already developed. I don't know how neural link stuff will develop, but.

• 1:48:34Anthony Pompliano?

  Yeah.

• 1:48:36Speaker 02

  Whereas I think, yeah, I think your brain on Adderall and your brain on enviable selection, there's going to be a big difference.

• 1:48:43Anthony Pompliano?

  Yeah. You wrote a piece about the myth of the myth of a well-read person. What is this?

• 1:48:49Speaker 02

  Yeah, so people have this idea that.

• 1:48:55Speaker 02

  People don't realize that you can actually know everything.

• 1:48:58Anthony Pompliano?

  Okay.

• 1:48:59Speaker 02

  And I, so I have a podcast and I get a chance to talk to these people who have comprehensive knowledge about everything that matters, everything you can know.

• 1:49:10Speaker 02

  Like Tyler Cowen, Bernhard Hobar, these kinds of people. And there is nothing you could say to them that they haven't already considered. There's no objection that they haven't already looked at, no implication that they haven't already analyzed. And the thing is, these people are just relentless infovores. And if you think about the kind, the amount of knowledge you need to understand a subject, right? So take economics, for example. Let's say you've read a dozen books about economics, not just random books, but like books that give you a broad explanatory understanding of what's happening. Then you do that for biology. Then you do that for computer science. How long does it take you to read 12 books if you've made a serious effort at it, right? You can do this for multiple disciplines in a single year. Now do this for the rest of your life. If you read the right book every, once every week or something for the rest of your life,

• 1:49:55Speaker 02

  you could know 80% about every single field in the world, right? And people have this idea that, oh, knowledge is so specialized, duh, you can't like, you know, there's like new books every single day, that you can't possibly ingest all the information. If by information, you just mean like you're memorizing trivial details, like you're memorizing the GDP of different Asian countries, like how many ant species there are. Yeah, sure, you can't memorize all the information. But just these basic explanatory frameworks, they don't change that often. In fact, they, if you think there's been a relative stagnation economically and in terms of knowledge recently, they actually are turning over very infrequently, like quantum mechanics, right? It's like you talk about quantum mechanics, we're like, oh, that's super woo woo, that's like a new thing in physics. It's 100 years old, right?

• 1:50:39Speaker 02

  These things don't change that much. Or like near Darwinian synthesis, 50 years old. Figure of computation, almost 100 years old. So you can learn about these fundamental ideas. And people don't seem to take this prospect seriously, because how many people do you know who are actually making an effort to know everything? I think it's a thing you can do, and I think very few people are attempting it.

• 1:50:58Anthony Pompliano?

  Why is it important to know everything?

• 1:51:00Speaker 02

  I think the returns to knowing more things have increased over time. So if you think about like a farmer in the 17th century, right? Even if he knew everything about everything, all the knowledge I was able to time, what is he gonna do with it, right? Like, he's not, um, he, he only needs to know knowledge about the thing he's particularly working on, like a book on guano farming or tree cutting or something. Whereas today, if you understand, for example, how economic growth works, how finance works, and you also understand, let's say, how nuclear fusion works, and you also understand computer science, you can put marriage, the software and the hardware parts, you can like build a multi-billion dollar business, right? Or you can become like you are a content creator who's able to synthesize all this information and put it together, and you can have like a huge brand that way.

• 1:51:45Speaker 02

  So the returns to knowing about a lot of things in a deep fundamental way have increased a lot over time. Like, I think today that, Elon Musk is a great example of this. This guy knows a shit ton about, there's stories about he would like show up to parties after the PayPal days, um, and then he would just like be reading of like a Russian, uh, Russian textbook by rocketry or something. That, that kind of, him just having a obsession with learning about different fields, reading textbooks on that, papers on that, that was the, look at the returns he's had on that, right?

• 1:52:14Anthony Pompliano?

  Yeah. It, it also reminds me of this idea, uh, generalist versus specialist. And obviously specialists are very important in certain fields, you know? You want your doctor to be a specialist, you want your lawyer probably to be a specialist, um, and many other, you know, types of fields. But the generalist, I think society, uh, based on books and, and articles and even Twitter and the way the conversation plays out, generalist means knowing a little bit about a whole bunch of things, but really what it sounds like you're making an argument for is knowing, uh, a good amount about the right things. And there, there's a difference there. It's not just, hey, do I, I've heard of quantum mechanics, right? And I know what field it is in, and maybe I read, you know, a one paragraph description

• 1:52:59Anthony Pompliano?

  one time. But if that is one of the 50 things that matter, uh, and are the right things to know about, then can I know 80% or can I know 50% about that field? That's very different than like an inch deep and a mile wide.

• 1:53:13Speaker 02

  Yeah, I know. I think that that's a great point you made, because a big failure mode you can have is... When people say generalist, I'm a generalist, right? Often what they mean is like, I, yeah, I don't have specialty, like, I don't know that much about any particular thing, but like, I don't know, I've like, looked into certain things. And I think this is a big problem with, not a huge problem, but I think this is something to think about when you're reading these pop sidebooks. Often, they don't give you that deep an understanding of the subject they're talking about. There's some really good exceptions to this. But yeah, if you take a serious effort to like, actually understanding things, which is very different from-

• 1:53:49Anthony Pompliano?

  How do you do it? Like, you said, the myth of the myth of a well-read person. Is it just reading?

• 1:53:54Speaker 02

  No, well, it really helps that I have a podcast, because I can't just passively ingest information. I have to really think about what the point the person is making, what implications their argument has, what contradictions it has. And that, I think, that really helps me make sure that I'm really understanding things in a deep fundamental way. I really think that the thing I'm trying to do with the podcast, I've had it for, I've been working on it full-time for not that long, I'm trying to develop a worldview. And by worldview, I don't mean like, a political worldview, like, you know, who should we vote for in the next election. But just in terms of like, where we are in history, what is going to matter in this century? What is going to matter in the long term?

• 1:54:36Speaker 02

  Like, how do you, it sounds vague and ambiguous when you describe it generically, but it requires you to understand a lot of fields deeply, which I don't yet, but I'm trying to. You can't make an assessment on the broader question of where we are in history, unless you understand where AI is going, where nuclear is going, where human enhancement is going, where the economy is going, what the rate of economic growth is going to be over time, where society, how society and culture are going to change over time. You need to understand all these fields, and I think there's a very few people in the world, and I'm by no means one of these people, I think there's very few people in the world who've actually developed a comprehensive worldview. And I think, when they do, it's really remarkable, and those people are really valuable.

• 1:55:14Anthony Pompliano?

  So, let's just go through this, because this is a fascinating exercise. Develop a worldview is a very intentional action. I'm going to go develop worldview. Why is that important? Is it just, it makes you a better thinker? It allows you to pick an occupation to go after? Like, what is the importance of selecting that as, okay, this is an activity worth pursuing?

• 1:55:33Speaker 02

  Yeah. Usually, when something is really rare, it often ends up being valuable. If you look at a specialization in academia and other parts of the world, there's very people whose job it is to just think about- The whole picture. And so it is a rare thing to do. And you ask like, okay, well, why is it valuable? Just because it's rare doesn't necessarily make it valuable. That's a fair point. But if you look at some of the most successful people in the world, like think of Peter Thiel, right? They say that his hedge fund is basically like a think tank rolled up in a venture capital firm rolled up in a hedge fund. But it starts off, you look at what he spends his days doing, there's, you know, he's like having seminars on Strauss or Hegel or something. It starts off with these like very fundamental first principles, thinking about like very

• 1:56:17Speaker 02

  different sectors are headed. I think if you want to find the most important things to work on, which is probably what you should be doing with your career, you, it would be very strange if you just accidentally happen to work on them. To work on them, you need to have, you actually need a worldview that first actually points out to you what the most important things to work on are, right? I guess you don't need to like, obviously it's more to like actually start working on the thing itself as well, right? And that's also part of how you develop that worldview. But yeah, to actually focus on the most important things, you need a worldview. And that doesn't necessarily, I'm not just talking about like a philosophy or humanities stuff. It also requires like technical expertise in a lot of fields.

• 1:56:55Anthony Pompliano?

  Okay. So you say, I want to go develop a worldview. How do you then choose what are the things that are important within that? There's a million topics. You could go to the New York Public Library and walk around and there's section after section after section. How do you know which ones are worth spending time on and which ones do you pass on?

• 1:57:12Speaker 02

  Right. And I think that actually is part of the worldview is, well, one of the things the worldview tells you is what is the most important thing? What are the most important things to be focusing on? I think you can, it's very easy to see when something is not going to be the most important thing. Like I think it's important to take a barbell view of how to think about the, the most important things are not, if you look at the news, right? It's things that are transient and trivial. People say the news is too pessimistic or it's too optimistic. It's neither optimistic or pessimistic enough. It doesn't focus enough on the upside, the things that are really going to revolutionize the world, you know, nuke technologies. And then, you know, like let's say making steel gets much cheaper, what kinds of new things can be constructed? Let's say batteries get much better. What kinds of new?

• 1:57:57Speaker 02

  What kinds of new robots and stuff, you know, cars, things can be built. It also doesn't focus enough on the downsides. You know, like what happens if there's a manmade pandemic, a lab leak, a new lab leak, that kills billions of people, right? What happens if the person who develops AI is somebody like China, where their norms and values are not going to be aligned with ours? So it's not going to be the thing that most people are thinking about. Because the thing that most people are thinking about is usually something that people have already looked into. And also, it's likely to not be like you're just thinking about like, what do people talk about day to day? It's going to be the things that nobody's talking about. And but that requires you to, yeah, it's, I think it's a good question. I honestly don't have a good answer to like, where do you start? Except just like, look at everything and try to understand in a fundamental way.

• 1:58:43Anthony Pompliano?

  And then, once you get into one of the topics, let's just use quantum mechanics as an example. So, hey, I believe that this is an important field to understand better. What does that process look like to go from I know nothing to I've got 25, 50, 80% understanding of this field?

• 1:58:59Speaker 02

  Yeah, I actually, learning about quantum computing was a thing that really made me decide that I wanted to do something more interesting with my career. Because, yeah, I was taking Scott Aaron, since like probably the greatest living theoretical computer scientist in the world. And I was taking his class on quantum computing. And you know, you, you, you think about how quantum computing works. If you take the multiverse view of quantum mechanics, it's literally different branches of the universe colliding to form an answer to a computer science problem you have. It's such an interesting problem. And it's so much more interesting than like, I don't know, like building a database for Google or something. So, but yeah, so how would you learn about that? I think it's important to not get lost in the details, but also to make sure that you're understanding.

• 1:59:43Speaker 02

  I think usually the best textbook kind of subject are actually pretty good at helping you understand things. Generally, it's you, you should do the exercises. You need to, yeah, you don't need to memorize trivial details, but you should also understand the actual fundamentals in a deep way.

• 1:59:59Anthony Pompliano?

  Yeah. And then when you start to look at the, I'll call it like base knowledge, it's almost like you're going to the source materials, whether it's the textbook or whatever to learn about the information. You develop this worldview. Are there folks that you think have developed those worldviews that you're like, okay, you mentioned Peter Thiel, are there others that you say, hey, these folks seem to have figured it out?

• 2:00:18Speaker 02

  Yeah, I think somebody like Bern Hovart, Tyler Cowen, there's a few people like this. And the thing is, there's not that many of them. But you can, you ingest their information, Wilma Cascol. These people have different worldviews, right? And that's what makes them interesting. It'd be really strange if you just happened to land up on the same worldview if you're both thinking from different premises. They have different worldviews, but the implication of these worldviews means that once they come out of that exercise of thinking about different problems, then they come up with these really interesting problems to work on. Those are some great examples. But like, for example, Wilma Cascol is this philosopher who has this new book on long-termism, how to improve the future. And so he just starts from the first premise of, well, let's make sure the future goes

• 2:01:02Speaker 02

  well. Okay, what are the things that could matter for making sure the future goes well? Well, one thing is, if society collapses, we want to make sure that we can restart society. Okay, well, how do we do that? Well, we would need another industrial revolution if the society collapses. What do we need for industrial revolution? Well, we would need coal, right? Because coal is the easiest thing to find and burn. Photovoltaics and solar and stuff, they just degrade really fast. Nuclear will degrade over time. So you just need to like take off some coal and start burning up the furnaces again. Okay, so maybe we should just conserve some easy to access ground coal that's close to the ground. Okay, so just starting from first principles, you come to the conclusion that we need to set up some sanctuaries of coal, right? That's just one example of the strange implications that come from thinking of first principles. Austin Vernon comes from

• 2:01:46Speaker 02

  an engineering background. He has this blog that not that many people know about. He comes to the conclusion, he's looking at the declining cost of energy over time. He says, okay, if energy keeps declining over time, at some point, it will become economical to take CO2 in the air, in the atmosphere, and use electrolysis to convert that into actual materials used to build things or used as biofuel, like ethanol, formic acid, things like that. Okay, once that becomes economical, people are going to start doing that a lot. And once they start doing that, there's going to be a shortage of CO2 in the air. Right? Okay, so he starts out with this very basic first principle, thinking, what is the cost of energy? What are the trends in energy cost? Okay, maybe that means that there's a energy, there's a CO2 shortage in the air, which is much more dangerous than overproduction of CO2.

• 2:02:31Anthony Pompliano?

  And does he put a timeline on something like that?

• 2:02:32Speaker 02

  Yeah, well, it's not super precise, but he thinks by 2100, it'll be, will be negative carbon, in a way that's like substantially negative carbon. I think he said 2170, actually.

• 2:02:42Anthony Pompliano?

  Which goes counter to pretty much the entire mainstream conversation at the moment of, we're going to be in the opposite situation.

• 2:02:50Speaker 02

  You know, I think that's really strange, really interesting and strange. If you look at some of the predictions throughout history that people have had, often, they've actually identified the correct problem, they get the direction of the vector, exactly opposite. Think of population, right? So, in the 70s, there's books about how the world population is going gangbusters, and you know, there's going to be overpopulation. And if you think from first principles, it makes a lot of sense, right? That people who have the most babies are going to eventually make up most of the population. Over time, that's going to drive selection towards people who have more babies. And if you have a lot of babies, there's going to be a Malthusian thing where there's not enough food to feed all the people, we'll hit the carrying capacity of the earth, and everybody over that will die of famine, plague, war, all kinds of nasty shit.

• 2:03:35Speaker 02

  So, first principles, it makes a lot of sense. And they were right, that population is a thing that's going to matter a lot. But the thing that actually looks like it's going to be, the trend is going to be that we won't have enough population. The real problem for civilization will be that there's not enough people. And it would be very similar to the carb, I don't, I'm not saying this is likely, but with the climate change thing, it would turn out that the real problem in 2100 is that there's not enough CO2 in the atmosphere, right? We identified the The correct problem, which is going to be order the, the direction of it completely wrong. I think it's an interesting trend.

• 2:04:06Anthony Pompliano?

  It's like we, we didn't even identify the right problem. We identified the right topic.

• 2:04:10Speaker 02

  Yeah.

• 2:04:10Anthony Pompliano?

  Right? CO2.

• 2:04:11Speaker 02

  Yeah.

• 2:04:12Anthony Pompliano?

  Everyone thinks it's one thing, but they misjudge and it ends up being the opposite problem. And, you know, I've said this to you before, but to me it's, you're on the highway and sometimes there's an exit, which it looks like you're just kind of veering off the highway. It's not a very kind of high degree change in direction, right? It's not a 90 degree, hit the stop sign, go right. It's just, hey, we're all going together at 65 miles an hour because we follow the speed limit. And then, you know, somebody in the far right lane, they just kind of peel off onto the exit. Some of those exits continue in the similar direction for a little bit. But some exits end up actually being 180 degrees and you basically do a 180, right?

• 2:04:56Anthony Pompliano?

  You, you just come around and then you end up going in the opposite direction. And that's what it feels like, uh, which is when you're going down the highway of these ideas, you can actually end up in the far right lane, or you can end up in the second to right lane. And that determines, even though it doesn't look like a huge, uh, kind of divergence at the onset of the exit, one keeps going straight and one ends up going in the other direction. And so to me, there's a lot of these, right? Where, where we end up seeing it. What I don't know is how do we get people to understand, maybe your conclusion is wrong. You have identified the right topic to discuss, but your conclusion is wrong.

• 2:05:35Speaker 02

  Yeah. And to be clear, by the way, I think, I think this is just like a hypothetical future, the climate change thing. I think probably it's more likely that he'll be an overproduction of CO2 than.

• 2:05:43Anthony Pompliano?

  You think so?

• 2:05:44Speaker 02

  Well, yeah.

• 2:05:44Anthony Pompliano?

  So why do you think his analysis is wrong?

• 2:05:48Speaker 02

  Uh, he, it requires energy to get significantly cheaper than it is now. And I think that's possible, but I'm not sure that, let's say that that's at 50%, right? That energy gets an order of magnitude cheaper. And then you have the probability that, okay, then people will really want to take carbon dioxide out of the atmosphere to do these things instead of like making, manufacturing these materials another way. That's another probability you had to add. And you just like chain together all the things that ought to be true for his vision to be true, then you get to like something under 50%, right?

• 2:06:16Anthony Pompliano?

  Was that the same analysis in hindsight of the 1970s overpopulation? Like you had to believe multiple things?

• 2:06:23Speaker 02

  No, I think you're right. Because their analysis, the people who thought overpopulation was going to be a problem, their analysis was pretty straightforward, right? It's just like, people have kids. We have limited amounts of food, so then there won't be enough food and land for them.

• 2:06:39Anthony Pompliano?

  And if you were the contrarian in the 1970s, would the analysis have simply been, yes, there are people having a lot of babies today, but as the entire society becomes wealthier and there's like economic mobility, we know that there's less kids in those wealthier families. And so therefore, population overall declines and society across the world, but specifically in the Western world, is naturally mobile upwards?

• 2:07:05Speaker 02

  But how would they have even known that at the time? Because there were very few wealthy societies in the 19... I think fertility in the US was probably... I mean, it was starting to decline because of sexual revolution and stuff. But even as recently as like, yeah, the 50s, obviously baby boomers and stuff, the fertility was super high. So you wouldn't... How would you have possibly predicted back then? Even today, we don't understand why fertility is declining, right? So how could you have known before it happened in the 50s that would have happened?

• 2:07:31Anthony Pompliano?

  Yeah.

• 2:07:31Speaker 02

  It would have been really tough. And that's another thing about predicting the future. It's like really hard to know. You know, we talk about like human enhancement, AI, energy support and those things. I think the probably the most important things are probably things we haven't even realized are going to be really important. I think it's really hard to predict the future.

• 2:07:45Anthony Pompliano?

  It's definitely, it's nearly impossible to predict the future, especially across so many different dimensions, right? So again, it goes back to almost being prepared, right? Rather than a prediction. Can you simply know a deep amount about some good important things? And then you're best prepared to handle whatever comes next? Although you cannot predict it, right? One of the problems that I actually believe has much more impact on society than, one, people understand, you know, in terms of severity of problem. But two is how far reaching the problem or impact is, is the declining testosterone.

• 2:08:23Speaker 02

  Yeah.

• 2:08:24Anthony Pompliano?

  10 years ago, no one was really talking about it. Now, I think there's like a kind of a subset of the population who says, hey, you know, like red flag, like I think there might be a problem here. My guess is five, 10 years from now, like it'll be a pretty widely accepted like, why is this happening? Maybe we don't understand it, but like this is a problem. But what's fascinating to me is if you look on the kind of small scale for one single person, the impact of low testosterone versus high testosterone is like completely different people, right? In terms of energy, productivity, sleep quality, health. I mean, like there's, it's so far reaching that it feels like if you then say, okay,

• 2:09:07Anthony Pompliano?

  across society, it's like, we're going to essentially downgrade all of these individuals in terms of performance, quality of life, all this stuff due to lower testosterone. And then we're going to add them all together to make up society.

• 2:09:20Speaker 02

  Yeah.

• 2:09:21Anthony Pompliano?

  Pretty important issue that, you know, we don't understand and we probably underestimate the impact. Like how much of the perceived increase in violence that we see is due to lower testosterone that leads to mental health issues that then leads to violence? Again, I'm not making the case that that's what's happening.

• 2:09:45Speaker 02

  Yeah.

• 2:09:46Anthony Pompliano?

  But if that 20 years from now, there was an analysis and we could make those connections, we would all be left scratching our heads saying like, holy shit, like no one saw that.

• 2:09:54Speaker 02

  Yeah.

• 2:09:55Anthony Pompliano?

  And so maybe it's not right, but who knows?

• 2:09:57Speaker 02

  I think you're at the, the, if you think about the difference between like a 20 year old guy and a 40 year old guy in terms of like their role views, what kinds of problems, like how, how, how much energy they have, like what kinds of risks they're willing to take. If you think that happens over the entire society has, turns from like basically the difference between a 20 year old and a 40 year old in terms of

• 2:10:19Anthony Pompliano?

  Yes.

• 2:10:20Speaker 02

  Like being more risk averse. One of the things testosterone does is just makes effort fun.

• 2:10:26Anthony Pompliano?

  Yes.

• 2:10:26Speaker 02

  Right? That's why I like 20 year olds will like work, you know, 14 hours, like, you know, in programming is like a common thing, right? Just, and then obviously like it's less common to see that as people get older. And also, that's why they're like these examples of like 20 year olds with like build these huge, obviously, it's the median startup founder is older, but a lot of these people who end up becoming huge founders, I don't know, maybe it's like, maybe Jeff Bezos is probably like, I don't know, TRT or something.

• 2:10:54Anthony Pompliano?

  Jeff Bezos today is a little different than Jeff Bezos 1999, yes.

• 2:10:58Speaker 02

  It's kind of insane. He looks younger than 20 years ago. Like, I was not alive when he looked older than he looks now.

• 2:11:06Anthony Pompliano?

  Yes.

• 2:11:07Speaker 02

  But you know, I think testosterone is really interesting because they've done these experiments on birds. There's, I forget the species, but it's like a monogamous bird species. The males of the species have high testosterone, like just naturally when they're single, when they mate and they form a monogamous pair, and especially after they have kids, their testosterone just goes down, declines by like many factors. And yeah, so part of that is like, you don't want to be this aggressive, risk-taking person after you've already had kids. You want to like, make sure things are safe and low volatility once you have kids. But the thing is, there's more single men now. So you would think that testosterone

• 2:11:47Speaker 02

  would increase as people being single increases. It's really mysterious. I don't know if you have a good understanding of, it could be the, it could be like the receipts and the chemicals. And just this morning, I was getting the coffee and then it was like, you gotta carry this receipt from here to here. They'll like make you take the receipt.

• 2:12:04Anthony Pompliano?

  What is the argument for receipts? I've heard water bottles and things like that, but what is receipts?

• 2:12:07Speaker 02

  I don't remember the exact thing, but like, apparently the receipts have some chemical that through your skin will, has some adverse impact on your testosterone.

• 2:12:16Anthony Pompliano?

  So like, stop receipts is going to become like a social movement to like, like get rid of it?

• 2:12:21Speaker 02

  Yeah.

• 2:12:22Anthony Pompliano?

  Killing the environment wasn't a big enough deal, right? It's like, fuck with our testosterone when receipts are gone.

• 2:12:27Speaker 02

  Yeah, fuck it, we'll do digital. What do you think it is? Like, why are men's testosterone levels decreasing?

• 2:12:33Anthony Pompliano?

  I don't think it's one single factor. Like, these things are usually, based on historical examples, like multiple things that come together. I definitely believe it has something to do with, with water, both from like the tap and also water bottles. I mean, if you just look, we have a bunch of water bottles here.

• 2:12:54Speaker 02

  It's gonna turn me into a fanboy.

• 2:12:56Anthony Pompliano?

  Yeah. Well, if you also think about.

• 2:13:01Anthony Pompliano?

  We were talking earlier today about, do you spend more time with your feet on the ground in a standing and walking position? Or do you spend more time with your ass in a seat? Yeah. Right? And what we're talking about was, should you spend more money on your shoes or on the chair you sit in every day? Hmm. Right? Like, in some ways, like, people think of like, "Oh, I want to be comfortable when I'm walking, like, they're my everyday shoes." But like, the chair you sit in, you actually may spend more time there than with the shoes on. And so, same thing goes for consuming liquids. Do you consume more liquids in a water bottle or without a water bottle? Mm-hmm. Right? And I'm not talking like, you know, people have like, these like, titanium or whatever thing. I'm talking about like, actual plastic water bottles.

• 2:13:45Anthony Pompliano?

  Like, if you start to almost audit your, like, liquid intake, my guess is people would be shocked at the percentage of water they drink that's out of a water bottle versus something else. Yeah. And so, again, there's debate as, is it actually water bottles? Is it not? Whatever. But like, that seems to be, have some impact to it. The third thing is, shit's safe. Like, we live in the safest time in human history, right? Like, you don't need to be worried, for the most part, right? That when you walk down the street, someone may try to kill you. You're not worried about a wild animal. Again, for the most part, you know, coming into where you sleep and killing you at night. You're not worried about going out and hunting for food.

• 2:14:28Anthony Pompliano?

  And so, just naturally, I think humans evolve, and so like, you get some drop. That doesn't explain the significant drop in, you know, the last 20 years, but definitely the longer-term trend. And then I think that there's a social thing. And this is where people get real weird and they don't like talking about it. But like, there is a very obvious, at least to me, trend of masculinity being, maybe not deterred, but definitely adding more friction to encouraging that. And so, you can see it in the type of content that is created from, you know, Hollywood and things like that. You can see it in social media and kind of sentiment changes.

• 2:15:13Anthony Pompliano?

  But also, you can just see it in like, what we ask of people in society. And some of this is not like, a man thing.

• 2:15:21Anthony Pompliano?

  If we are a society that says, okay, we used to be 100% capitalism. And now maybe we're like, ah, capitalism is good, but like now there's some times where like socialism is good. Right. And we don't say it that way, but like, that's what ends up happening. What it does is it dulls, right? I think dulling is a, is a good word. You don't take away certain aspects socially. What you're doing is you're dulling the self reliance, the independence, the like, uh, kind of characteristics that for thousands of years masculinity was very similar to. And so when you start to look at it, it's like,

• 2:15:58Anthony Pompliano?

  you can't point to any one thing and you can't even point to one thing in the last 20 years necessarily. It's all of this stuff coming together. And so if you said to yourself, like, forget like maybe water and plastics and things like that, like what would have the rate of decline been anyways? Right. And what, how had it fallen from, you know, I don't know, a thousand AD, right? To like 1500.

• 2:16:20Speaker 02

  Yeah, yeah, yeah. No, I think if you look at the history of violence or history, where else would you look? You see, I think it's a good thing that you see a huge declines in violence over time. Even if you look at the time that testosterone is decreasing, let's say the last few decades. Look at like crime rates in the nineties, look at crime rates now. There's been a recent resurgence, but over time, crime rates have been like dropping a lot. I think that probably has to do with the fact that there's less testosterone. Just read like, or read the Iliad or the Odyssey or something like people are constantly getting butchered. Um, and I think that probably was not just the story. I mean, the thing itself is a story, but I think that was an indication of the kind of societies people lived in

• 2:17:01Speaker 02

  in terms of the ever-present nature of violence, of genocide, of war. And so, you know, maybe the way to think about declining testosterone is just as like declining volatility. In the sense that, yes, you'll have fewer criminals if there's less testosterone. But you'll also have fewer Jeff faces than Elon Musk's because one of the thing that drives them, at least when they were young and building up their career capital, building up their skills, is I'm guessing the average startup founder probably has more testosterone than the average person.

• 2:17:29Anthony Pompliano?

  I was gonna ask, I wonder if you could break down the person who goes takes the job at Google versus the person who starts a company, right? And you did an entire study. The expectation, I think, again, you'd have to run the experiment to know, would be that the startup founder would have higher testosterone, right, than the person who took the job at Google. And then I wonder if there was even a difference between the successful founder and the not successful founder, right? Now, some of it's outside their control, there's market conditions, there's all this type of stuff. But if there was a difference, it would be interesting. And you can imagine the backlash to a study that if it got to the conclusion and linked higher testosterone levels with higher success, there would be fucking chaos, right? People would be like, oh, that's bullshit, whatever.

• 2:18:13Anthony Pompliano?

  Because then all of a sudden, the question would become, should, rather than sticking computers in people's brains, like, it's the first step, hey, don't drug people with Ritalin, like, instead, just, like, hand out testosterone to people, right?

• 2:18:26Speaker 02

  All I'm saying is, look at the Amazon stock price in the last five years. That's all I'm saying. But regarding the chemicals in the water, there's this blogger, Slim Multimold, that have been looking at the increase in obesity over the last few decades. And their theory, it's not just like people are eating shittier food. It's also that maybe there's chemicals in the water, they're trying to figure out what it is, that are, that are causing this increase in obesity. And one of the pieces of evidence is, if you look at places that are higher in elevation, like places like Colorado, they have lower obesity rates than places that are lower in elevation and next to rivers. So think of, like, Louisiana, or Texas, or something.

• 2:19:11Speaker 02

  Those places have higher obesity rates. So if it's, and if it just, like, run off of chemicals, that's exactly what you'd expect.

• 2:19:18Anthony Pompliano?

  But how much of it is just like, people in Colorado like to go outside, and people in Louisiana, you know, the generalization would be like, they go, you know, to Mardi Gras and eat fucking fried chicken.

• 2:19:26Speaker 02

  No, I think that's right, that's probably the good null hypothesis. Like, I think that's also good.

• 2:19:30Anthony Pompliano?

  And food is a fascinating thing, so there's a small town in North Carolina that I drove through, I mean, two years ago or so. And we were driving through, Plana said to me, she goes, Wow. I was like, what? She's like, look, and we were at a, at a red light and we could see kind of through the town and there was, I don't know, maybe three lights or so, four lights, right? Uh, and it's next to a highway. So it's like right off the exit of the highway. Every single place that you could get food was completely unhealthy. McDonald's, Wendy's, you know, all these things. And then it was like, you know, uh, Cracker Barrel, right?

• 2:20:12Anthony Pompliano?

  I mean, like, you know, every single thing. And it was like, if you live in this town, other than go to the grocery store, there's not a single thing from what we could see that was a healthy option. And so low cost, convenient, and the abundance of options, right? Ends up leading people to bad health and, and diets. But also, when you layer in some of this other stuff of sedentary lifestyle, you know, whatever. And then you've got the genetics on top of it. Like it just stacks on top. And I actually think for the average American living in a small town, the deck is completely stacked against them. Doesn't mean it is not possible to live a healthy lifestyle, to be in shape, to do all this stuff. But like, sure as hell ain't easy. And so

• 2:20:57Anthony Pompliano?

  that then I think is also a contributor. Like you have the stuff in the water, but like, you sure aren't optimizing your testosterone if you're eating McDonald's every day.

• 2:21:05Speaker 02

  Yeah.

• 2:21:05Anthony Pompliano?

  Right? And so how much is food? How much is water? How much is social? Like, there's a lot of stuff in there that just ultimately leads to man, testosterone's going down and like, we probably should try to figure it out.

• 2:21:14Speaker 02

  Yeah. And I think probably obesity is maybe the most important. If you think about like, what is the thing that's the biggest factor to testosterone declining? I wouldn't be shocked if it's just obesity. Like people are fatter. I think fat, uh, if I remember correctly, becoming fatter decreases your testosterone or increases your estrogen or something like that. Uh, because yeah, obviously like the fat stores hormones. But yeah, I think this is not just testosterone, but this is like a broader thing about society over time becoming more complacent. And part of this is testosterone declines, but if you look at like new businesses that are created, you know, you hear about these stories of startups and you know Uber, you know, Facebook, Google, actually over time, if you look at the number of new businesses that are created,

• 2:21:57Speaker 02

  it's been declining over time. As people get wealthier, you know, you have more regulations, you have a bigger welfare state. Maybe these things make sense at some level, but also it's maybe it's like you basically, you're at the casino, you're like one big, if you're like a wealthy country and you're like, okay, I'm just gonna cash it in. And so I'm not gonna have economic growth, but I'm just gonna like redistribute the wealth you already have. That's basically what you're doing, right? You're like leaving the casino. But yeah, it is concerning that over time wealthy societies become stagnant and complacent like this, where they have regulations that make growth really hard. There's, I guess, like even hormonal changes, like literally the testosterone goes down over time.

• 2:22:35Anthony Pompliano?

  Yeah, 100%. You wrote a piece about popularizers or intellectual market makers. What do you mean by popularizers? And then what is this idea of like an intellectual market maker?

• 2:22:44Speaker 02

  Yeah, so if you think about what a market maker does, right? A market maker is somebody who provides a service in the market. You go like Robinhood or something, you can see that you can like buy any stock you want anytime you want. Why is that possible? It's because there's somebody who provides a service where they're gonna buy your stock at let's say $1.01, they're gonna sell it at 99 cents, they're gonna make 2 cents of money off of that. So you're paying a little bit of fee to them to provide liquidity to take it off your hands anytime you want. And so you don't have to like wait for another counterparty to come around to be able to sell that stock. I think if you think about what popularizers do, so think like public intellectuals, pop site book writers, I think they're actually provide a very similar service in the intellectual sphere. So you think of somebody like Malcolm Gladwell, right?

• 2:23:28Speaker 02

  How does he, how did he achieve his nerd entirety? Well, one of the things is he takes this undiscovered study about hockey players and their birthdays, and he converts it into this New York Times bestselling book called Outliers, and then he makes money off that spread, right? And the thing about market makers is they provide an actually useful service. So it's useful to both, all three counterparties. Similar with like Gladwell brought up the profile of this guy who wrote a study about hockey players. He brought like a useful book to consumers and he's making money off that spread. And people degrade these kinds of popularizers. Oh, it's like alternative, right? You hear talk about like you all know Harvey's book. It's like, oh, these are ideas people already had. I think people miss the point that if you don't have these intellectual

• 2:24:12Speaker 02

  market makers, if you don't have these public intellectuals, you don't have liquidity. Market makers provide liquidity, right? So you don't have liquidity in the intellectual marketplace. And if you don't have liquidity, ideas can't be exchanged. There's not as much turnover in ideas. People aren't exposed to ideas. Just if you didn't have market makers, you couldn't like easily buy stocks off Robinhood. So when you think about it this way, you understand the value that these popularizers are providing. You don't just think of them like, oh, they're just like regurgitating information.

• 2:24:40Anthony Pompliano?

  The idea of a popularizer being an intellectual market maker is not new. Like, you said it in a way that is new.

• 2:24:51Speaker 02

  It is a self an example of intellectual market making?

• 2:24:54Anthony Pompliano?

  Well, guess who is probably the world's most famous popularizer?

• 2:25:02Anthony Pompliano?

  Thomas Edison.

• 2:25:04Speaker 02

  Oh, interesting. Same way?

• 2:25:05Anthony Pompliano?

  Thomas Edison's entire model was that he would go find young, incredibly smart innovators, get their ideas, bring them in, fund them, and then help popularize those ideas. So Edison didn't create electricity. Edison didn't create all these different things. But in some way, it was a cross between like, in today's society, Y Combinator and like Joe Rogan's podcast coming together to help discover, fund, operationally, increase

• 2:25:47Anthony Pompliano?

  productivity, and then popularize the idea. And so in some way, it wasn't write a book, right? It was more so like what we would consider action or productivity. But like at the end of the day, like that's, that was what the business he was in.

• 2:26:05Speaker 02

  Yeah, yeah. It's also sort of like Peter Thiel, right? Like him scouting out talent. It's like he's basically market making between the talent he scouts and the companies he creates and funds. So yeah, actually, that's a really interesting way to think about people who spot talent and who spot new ideas.

• 2:26:21Anthony Pompliano?

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• 2:27:06Anthony Pompliano?

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• 2:27:45Anthony Pompliano?

  If you have to choose between finding somebody who is high-performance, high-intellect, outlier potential, or like high volatility, as we talked about earlier, or somebody who is well-versed at management and all this stuff, the difference between the best investors in the world and the top quartile is that the best investors will pick the high volatility person, not the high management person.

• 2:28:13Speaker 02

  How do you find people who are high volatility? What is it about their past, about their presentation that you can tell this person's gonna?

• 2:28:20Anthony Pompliano?

  The pattern, there almost is no pattern, which is why they're high volatile. And probably the place that I find the most of them is on Twitter.

• 2:28:30Speaker 02

  Interesting.

• 2:28:31Anthony Pompliano?

  And they're usually talking about stuff that, they almost never have a lot of followers, right? Or a lower amount than you would expect. They're usually talking about weird things. And they usually, actually, you can tell if you read through their tweets, they are high volatility. Like there's times where you can tell like, okay, this is like, uh, maybe in the content, there's volatility. So like, they're talking about this one extreme thing, then they're talking about another extreme thing, they're talking about this other, and like, you're like, oh, this is kinda all over the place, but you realize it's because they're like a curious person, or they're like high intelligent, they're trying to learn, or whatever. Uh, there's volatility from an emotional standpoint. So there's, uh, they get really excited, they get not so excited, and like that high, uh, emotion volatility ends up, uh, being something

• 2:29:16Anthony Pompliano?

  that you can tell if somebody's created, uh, tweeted enough or something on Twitter, and then when you talk to them, you definitely can. Um, and then also, uh, I think that you can tell, uh, based on ambition. So if you talk to somebody for long enough, you can tell, uh, high volatility, uh, to the upside, in terms of they're very, very ambitious about some things. And then there is almost a complete counterbalance in that they are, uh, so disinterested and, uh, completely, uh, bored by things that actually usually society would be, you know, uh, super excited about. So like, a good example would be, I wanna solve this really, really hard problem, and I don't care if I make any money. Hmm.

• 2:29:56Anthony Pompliano?

  Right? And you're like, man, those like, those are two different ends of, uh, kind of the goal, you know, spectrum. And most people optimize for the money, and like, if it happens to be a hard problem, then like, cool, that's intellectually stimulating. So there, there's a bunch of different frameworks, and I think that what you end up just realizing is, uh, uh, it's kinda like a volatility index. Like, when the VIX spikes, like, shit's getting crazy, people have like a personal VIX score almost, right? And you just talk to them, and you're just like, this person is within this like narrow band, or this person is not within the narrow band. And like, not being in the narrow band, again, like, can have many different outcomes. It could be like genius moron, right? Like, insane, you know, rational optimist.

• 2:30:42Anthony Pompliano?

  But I think over time, people have, uh, who, who look for these types of folks, they just realize like, the one thing that everyone is certain is avoid the people within the band, because, uh, that's not where the outlier outcomes are.

• 2:30:57Speaker 02

  Yeah. Yeah. And you know, one worry you could have is we have institutions that homogenize so much that you're not reducing the media, like the median on me, like the median value of somebody who like goes to Harvard maybe increases, like maybe they're learning valuable skills. But if you've gotten rid of the tail outcomes, and if most of the value comes from those tail outcomes.

• 2:31:20Anthony Pompliano?

  Yeah.

• 2:31:20Speaker 02

  Then you've actually done something very bad. I, this guy wrote a really interesting, you can ask the question of like, why are there, when Shakespeare was around, the human population was like less than a billion, it was like significantly less, uh, when Shakespeare was around. And, you know, he's like said to be the greatest writer of all time. Or just go back to like Einstein, Edison, these people around, the human population was a lot lower. And these people are just like super outliers. These kinds of people almost don't seem to exist today, right? Like, there's no writer who's as good as Shakespeare. There's, uh, Elon Musk is like, adventurous as good as Edison, but like scientist was as good as Einstein, right? And one thing that could be happening is you have institutions, uh, that if you think of like writers, they go to like, uh, masters of fine arts, right? Okay. And they live in Brooklyn.

• 2:32:03Speaker 02

  So everybody who could be writing a really brilliant book, they're not out there like Melville, you know, like becoming fishermen or something, and they're like getting exposure to a idea that gives them the idea, right? Uh, um, writes on like magnum opus on, you know, uh, they're just like, they're literally living the same lifestyle as everybody who's trying to do the same thing. Same as like going to Harvard, right? Same network, same ideas, same skill set. So if we're reducing the volatility of civilization, um, through these kinds of homogenizing institutions, I think we make a mistake by just saying like, oh, the median hasn't decreased. You're, you're forgetting that what, um, you know, somebody asked me a question like, why don't we, why do we only have one Elon Musk? There should be like a thousand of them going around. Like, what happened to the rest of them? Right?

• 2:32:47Speaker 02

  Did we just kill off the tail of that kind of outcome and then only one of them survived whatever filter we had there?

• 2:32:55Speaker 02

  Yeah.

• 2:32:56Anthony Pompliano?

  I think that we probably have more than one. There's just one who lined it all up.

• 2:33:00Speaker 02

  Yep.

• 2:33:01Anthony Pompliano?

  Ambition, capital, network, courage, right? Like, it takes a lot of different things, but there's probably other people like that. And, you know, you could look and say, ambition is a great one. What's ambitious to one person is not ambitious to another person. And in many cases over history, there's been people who have been highly ambitious and have come to conclusions that ended up being really important, but at the time they were laughed at. Right? I'm gonna forget the, the name of the person, but there's

• 2:33:40Anthony Pompliano?

  an individual who the world is round, but the rest of the solar system does not revolve around the earth, revolves around the sun.

• 2:33:52Speaker 02

  Mm hmm.

• 2:33:52Anthony Pompliano?

  And was killed for it.

• 2:33:54Speaker 02

  Yeah. Was it Copernicus?

• 2:33:57Anthony Pompliano?

  I forget. And so when you think of that, like, now we're like, duh. Right? But at the time, crazy. You're insane. So then begs the question, like, what insane thing exists today that you actually think is more likely right than wrong? And so there's things that probably in the tech world, we think of, you know, around solving problems or whatever, but there's probably countercultural things in society. That seem absolutely fucking bananas. And then 20 years from now, 30 years, 50 years, you know, during our lifetime, we'll be like, I can't believe we didn't realize that.

• 2:34:37Speaker 02

  Yeah. I do wonder, I mean, there's this movement of like trad, I don't know if you've seen the stuff.

• 2:34:43Anthony Pompliano?

  No, what is it?

• 2:34:44Speaker 02

  Basically, like, living, living like people.

• 2:34:50Speaker 02

  Living like people lived like many decades or centuries ago, but with like modern technology.

• 2:34:53Anthony Pompliano?

  Why would you do that?

• 2:34:54Speaker 02

  Well, it's not like Amish, like you still adopt modern technology, but you also have, I guess, more traditional lifestyles in terms of like gender norms or, um, or like, or, or just, you know, like what kinds of careers you choose, things like that. So.

• 2:35:11Anthony Pompliano?

  So you still have like a cell phone, you still have electricity, you still have whatever.

• 2:35:15Speaker 02

  Right.

• 2:35:15Anthony Pompliano?

  But it's more so.

• 2:35:16Speaker 02

  You basically, you have like a lot of kids or something.

• 2:35:18Anthony Pompliano?

  Okay.

• 2:35:19Speaker 02

  Yeah. Um, and yeah, it sounds weird. Uh, actually that's not even that novel, but I do think that the way we like organize families and communities today, there is an element to it, which is maybe over time, it'll seem like that was like a really isolating way to live. And you know, if you, if your ancestors couldn't see how you lived, there'd be like, they'd be super, uh, they'd be super anxious about the fact that you were just like alone most of the day, right? When they're trapped in a house, what you were telling me about, you know, going to the Tiananmen Museum in New York, like 10 people in a small room. Okay. That sounds, maybe that's too much, right? But then just like millions of people living in an apartment by themselves. And it also probably sounds a bit dystopic to them from the opposite perspective.

• 2:36:04Speaker 02

  And also probably the free to cheap information that you consume on your phone, some of that would, uh, they would not approve of, right? So I think over time, like the way we think of, I, I wouldn't be surprised if fundamentally, some of the ways we like live, organize families, communities today would be looked at in the future as,

• 2:36:23Speaker 02

  um, yeah, that was like a really isolating and weird way to live at the time.

• 2:36:27Anthony Pompliano?

  Yeah. 100%. And it also, uh, if you look at a lot of society's problems, like probably could be boiled down to like a great way to solve it would just be better parenting. Like you ever see like a news story and you see somebody doing something and you're like, man, if that person had a certain type of parent, like they'd smack them in the face, right? Just be like, what are you doing?

• 2:36:47Speaker 02

  Yeah.

• 2:36:47Anthony Pompliano?

  And, uh, again, that's not the solution to everything, right? But like, that is the proxy for, uh,

• 2:36:57Anthony Pompliano?

  There's definitely something there around family parenting, the way people are raised, like all this stuff. And like, some of it's positive, right? Like, there is this element of the way that some people were raised 50 years ago was actually bad for the kid, right? Like, it fucked them up as they grew up. But then there are some other things that, like, hey, maybe we need more, you know, discipline or whatever. And it's, some of it's a story as old as time. Like, how many different decades was the story like, oh, young, energetic, you know, lost, unorganized man joins military, gets disciplined, becomes productive member of society? Like, that's just a story that has always existed for

• 2:37:40Anthony Pompliano?

  a long time. But there's other examples of it in society. And so, like, I always want to go back to just like, again, how many of the problems are fixed or addressed via social means versus legal versus like, technology? And the truth is that, like, actually, a lot of our problems in society that are like fundamental problems that people feel on a day to day basis, they're not technology problems. They're usually these other things.

• 2:38:10Speaker 02

  Yeah. But parenting, by the way, is one thing where I have like, where I think we're really doing a bad job. In some ways, it's like much better than the past, right? Like, kids are not getting like beaten or something. So, actually, there was, Dan Carlin has a book on history where he says, I think he estimated that like, more than half the kids who have ever lived were like sexually abused or another way, like physically abused. Because, I forgot what his evidence was. But yeah, like, I think there's some pretty dark things. If you look back at history, like how kids were treated. So, in many ways, we've like made a lot of progress. But I think one thing, I had this lady come on my podcast. She's, she's the founder of a movement called Taking Children Seriously. And the idea is,

• 2:38:54Speaker 02

  if you think about the way we treat children in terms of the rights we give them, there, if you treat an adult this way, it would just be a huge infringement on somebody's own personal autonomy, like trapping a 16 year old in a government building from 9 to 5 in this, like, basically this prison. And if you look at the outcomes of education, like, it's basically useless.

• 2:39:15Anthony Pompliano?

  It's 100% prison for most kids. Not every kid. There's, again, there's a reason why traditional education is a part for certain occupations of, but. You're telling a child, sit down and shut up for eight hours a day. Like, that's not natural.

• 2:39:29Speaker 02

  It gets even darker if you listen to these stories about Chinese education. There's this guy has a doorman, he has a great review of this book called Little Children, where he talks about this lady, she like moves from America to China and her kid is like enrolled in a Chinese preschool. And like, there's a crazy, one of the things that happens is, he's forced to draw raindrops, or teardrop, yeah, raindrops, but it's like, hours a day, they had to be the exact same shape and form, and if you like, mess up, if you like, try to like, actually make the figure different anyway, they punish you. Or one time, her kid was just, he hated eggs. So, the school like, fed the kid's eggs, and the kid really hated eggs.

• 2:40:13Speaker 02

  So they like, physically force feed him eggs, so that he can get over his aversion. And when the mother goes to the teacher and she's like, yo, what the fuck are you doing? The teacher's like, never talk back to a teacher, ever. Like, the adults have complete authority, the children are treated like shit. Yeah, so, but even, like, even if you think about, like, if you look at the outcomes of education in the US, right? If you ask people who have taken Spanish in high school or middle school, just like, remember anything about Spanish?

• 2:40:41Anthony Pompliano?

  Hola.

• 2:40:42Speaker 02

  Right. I took four years of Spanish in high school, I was in Mexico City, I have like, I barely remember anything. But just like, stuff like, how many years of civics education? People always talk about, like, we need to increase civics education or something. How many years of civics education and history are you already giving the kids? And you look at like, polls, you ask people, what are the three branches of government? Or like, how many branches of government do we have? It's like, a small minority know that. So, education is just like, completely useless, or mostly useless, outside of just like, the basic numeracy and literacy. And we're forcing kids to be miserable for hours a day.

• 2:41:12Anthony Pompliano?

  Social control as well, like, what do you do with the kids, right?

• 2:41:14Speaker 02

  Right, yeah, yeah.

• 2:41:15Anthony Pompliano?

  Like, in some way, many parents, like, at school is almost like a babysitter. Right? It's like, I gotta go to work. And, again, you can't lose the other side of this equation, which is like, if the parents couldn't go to work... Because they had to watch their kid, like, that's not an option. You gotta go to work. So then it's like, okay, well, what are the, what is the cost to doing something with the child while you're at work?

• 2:41:39Speaker 02

  Yep. That's why I'm a fan of child labor.

• 2:41:41Anthony Pompliano?

  Child labor?

• 2:41:42Speaker 02

  Yes.

• 2:41:42Anthony Pompliano?

  All right, explain this.

• 2:41:45Speaker 02

  So when people talk about child labor, they think about the last time child labor was legal, which was when they were like getting their hands burned off in some cotton factory. You know what I mean? Like some type of factory.

• 2:41:54Anthony Pompliano?

  Nike in China.

• 2:41:55Speaker 02

  But like.

• 2:41:56Anthony Pompliano?

  Nike doesn't do that. They claim.

• 2:42:00Speaker 02

  Yeah.

• 2:42:02Speaker 02

  So that's what they think, all right? But that's not what jobs are today. Like, adults at the time were doing the same kind of work. Today, it's like, he would work at a donut shop, or he would like work at McDonald's or Walmart or something. And I would claim that the skills you learn at McDonald's, actually, I think this is actually something they do really well. It's like showing up on time, being responsive, being, having like social skills, being, having like self-control. I would say that that's more valuable than any given day in like a public education system.

• 2:42:34Anthony Pompliano?

  So I agree, except for I'm gonna twist this one way. I would look at it less as like, go work at McDonald's, go work at Walmart or whatever. And I think, again, I have an eight-month-old daughter, so I'm like actively thinking through, but I've got time to kind of figure out, you know, how to handle this.

• 2:42:52Anthony Pompliano?

  I sum it up as like apprenticeship.

• 2:42:53Speaker 02

  Yep, no, I agree.

• 2:42:54Anthony Pompliano?

  Like apprenticeship model feels like a great way for people to learn without the downsides of like, sit down, shut up, don't talk for eight hours, right? And when you say this whole like taking kids seriously, you know, type movement, it's just treat them like an adult, and I think they begin to emulate what adults do.

• 2:43:16Speaker 02

  Yeah, yeah.

• 2:43:17Anthony Pompliano?

  Like, if you treat a kid like a one-year-old kid, and you're constantly telling them, no, and this and that, like, they just act

• 2:43:24Speaker 02

  Yep.

• 2:43:24Anthony Pompliano?

  exactly like you're treating them, right?

• 2:43:26Speaker 02

  If you treated a 25-year-old like you do a 14-year-old, and also they, I guess they didn't realize they were 25. I don't know, it's a weird thought.

• 2:43:33Anthony Pompliano?

  No, no, they, but you know what I mean? Still, if you still treat them like they're 14, they, they revert.

• 2:43:39Speaker 02

  Exactly.

• 2:43:39Anthony Pompliano?

  About fourteen year olds.

• 2:43:40Speaker 02

  Which, which also raises the possibility that if you treated fourteen year olds now like they were twenty five, right? So that, you know, like, basically, they're the beginning of their career. Not that they're like stuck in this infant primordial state of constantly getting more education in ways that don't seem related to any obvious career. But just like, okay, you're fourteen, you're gonna get an apprenticeship, you're gonna like, go intern at some, you know, like a programming firm or finance, whatever, right? Like, you're gonna like, actually get a, if you look through history, you look at how education worked in, how like careers worked in, let's say, like medieval times or something. You know, it was like you apprentice for a black, you apprentice for the person you want to become in your career.

• 2:44:22Anthony Pompliano?

  Of course.

• 2:44:22Speaker 02

  And parents would pay the person for the privilege of having their child work for them, because they realize that the education, like the first education is way more important. There actually is a scientist, I forgot his first name, but it's called this two sigma problem, where he discovered that one on one tutoring is two standard deviations more effective than the current education system, where you have like twenty kids in a school. So just if you just had replaced current system, which is like, you give everybody an apprentice. The problem is the way that, the way that the labor market regulations work here, like with internships that are unpaid, you're, the law literally says you're not allowed to get any economic value from them. If you get economic value from them, you're not allowed to have them, have to be an unpaid intern.

• 2:45:07Speaker 02

  But they're getting value out of, they're getting experience, which is like super valuable to them. That's not legally allowed for you to give them that experience. And it's, and, yeah, so basically, this puts a huge drag on people who would use this as like a lever to climb up in their-

• 2:45:22Anthony Pompliano?

  Warren Buffett, right? Like, somebody asked him, hey, can I come work for you for free? And he said, no, that'd be too expensive. Right? Like, you're taking my time, right? Which kind of fits along this. But, yeah, I just think-

• 2:45:36Anthony Pompliano?

  If you took a 14, 15 year old kid, by the way, I was a shithead 14 year old kid. Right. And most, especially young boys, but most kids are, their brains aren't formed like they act like idiots. Right. They, they got too much energy, like all these things. But I'm willing to bet I would have learned more if you said to me, hey, every six months, you're going to go, you know, you're going to work at this place, you're going to do this, you're going to do this, you're going to do this. And you could say, okay, cool. You know, when I was 14, there was like three or four things I thought could be cool, potential like job paths. And you say, cool, you're going to go spend, you know, every day for, you know, every weekday, you're going to go spend with these people and you're basically going to have this apprenticeship. And you're just going to do whatever they need you to do. And at the end of two or three years, I probably would have a pretty damn good education from like real world exposure.

• 2:46:21Anthony Pompliano?

  But also I probably know better as to what I was most interested in. And so like, are we doing people a disservice by putting them through high school, they graduate? And then it's like, go to college and like figure it out in college. Well, like where you go to college, pretty damn important, you know, decision.

• 2:46:36Speaker 02

  Where should study?

• 2:46:37Anthony Pompliano?

  Whether you go to college or not, pretty important decision, right? And so you just don't have any exposure really, because you know, every once in a while, I'll get an email from somebody who's like a high school senior and they're like, hey, I want to do like a, a summer internship or something. And I'm like, okay, but there's like no model for that. And by the time you're a senior, that summer is like the summer before you go to college. You already made all the decisions. So like, what if you were like a freshman or sophomore?

• 2:47:04Speaker 02

  Yeah.

• 2:47:04Anthony Pompliano?

  And different.

• 2:47:05Speaker 02

  The, um, the crazy thing is not only that are you forced to kind of decide on those kinds of things when you're pretty young, um, in a way that is, you had to do it without the experience of what the careers are like.

• 2:47:19Speaker 02

  But the, the, the, the amount of time it takes to go through that process, like if you talk to a smart kid in high school and you're like, okay, how long did it take you to apply to colleges and stuff? It is a huge bureaucratic time consuming process. These kids could otherwise be spending time doing a whole bunch of cool side projects that are going to be really help their career. I mean, in, in programming, it's like you start a GitHub account in your high school and you start programming some things. People are going to notice and they're going to be impressed, right? It's like a proof of work. Um, you don't have time for that if you're applying to colleges and writing these bullshit essays. Where you had to pretend that you're going to the college for a reason other than the obvious reason you go to a prestigious college, which is you want to make a lot of money, right?

• 2:47:58Anthony Pompliano?

  Did you see, um, Maybe it's Morgan Housel, somebody on Twitter recently was like, "High school,

• 2:48:06Anthony Pompliano?

  you fail because you didn't meet the 10-page minimum essay requirement." Like, "Real world, promotion, you sent me a two-bullet-point email." Whatever it was, and it was basically just like, "What are we talking about here?" Right? Is, you actually, in the professional world, get rewarded for being able to communicate clearly and concisely.

• 2:48:26Speaker 02

  Yep.

• 2:48:26Anthony Pompliano?

  But somehow, like, we all did it in high school. I'd say, "All right, how do I do like 1.5 space, right? Like, ah, they're gonna be able to tell 12-point font versus 12.5 font, right? Like, can we play with the margins? Like, you're just like, I'm literally wasting time.

• 2:48:41Speaker 02

  Yep.

• 2:48:41Anthony Pompliano?

  Right? Doing dumb shit to try to meet some, you know, made-up requirement.

• 2:48:47Speaker 02

  Yeah, yeah. I think over time, hopefully, there'll be more ways to signal that... If you think about, what is education signaling, right? The main reason to go to college is to send a signal to future employers. That signal is, "I'm intelligent, I'm conscientious, I can work hard, I can do like tasks that are kind of boring and maybe not directly useful, I can just work hard at them, and I'm conformist." Right? Which is like, a thing that probably employers care about. It has a negative connotation, but it's like, "I'm not gonna like, you know, like disrupt the workplace or something." Hopefully, there's ways to signal intelligence conscientiousness early on and better than college. And if that happens, the whole oligopoly we have of education...

• 2:49:28Speaker 02

  You know, the schools that receive federal funding are the ones that get to determine if another school can receive federal funding for education. It's a total, like, just a total oligopoly. Anyways, so if for programming, let's say GitHub, your GitHub resume becomes more important than where you went to college, which it should be, right? Like, what you can actually do, there's a clear eligible signal of that. Then, hopefully, the power of these... Like, people won't feel forced to go attend like a four-year university degree that way. There was actually the, I had this guy on the podcast, Scott Young, I don't know if you've seen, he did something called the MIT Challenge, where if you look at MIT's curriculum and all its courses, to their credit...

• 2:50:10Speaker 02

  They've made it all open source. So all the lectures, all the exams, they're all open source. So he's like, okay, let me see if I can speed run MIT's computer science curriculum. In one year, he goes through all four years of CS classes at MIT. He, I think he was going at an insane pace. It was like one class a week. It just like worked all day, all night at it. And he would self administrate the exams and like if he, he would like, as long as he didn't fail those exams and those homeworks, he would like say, I've, I graduated this course. And so he did that. It took him a year and he got like all kinds of insane programming job offers after that. Cause like, that's a novel volatile thing to do. People noticed that. It's almost a better signal than actually going to MIT. Hopefully over time, you can do more of those kinds of things.

• 2:50:55Anthony Pompliano?

  There is like two years of work in four years of college, maybe two years.

• 2:50:59Speaker 02

  Yeah.

• 2:51:00Anthony Pompliano?

  Right?

• 2:51:01Speaker 02

  Yeah.

• 2:51:01Anthony Pompliano?

  Like, there's a lot of bullshit that goes on.

• 2:51:03Speaker 02

  I would be surprised if it's two years. Like, that sounds like way too much.

• 2:51:07Anthony Pompliano?

  Yeah, I'm, I got an economics degree, which at the time, I selected one because it was going to be the shortest path to getting a degree, but also to, I had some intellectual interest in it. I think you had to take eight credits. There's like eight classes.

• 2:51:20Speaker 02

  Jesus.

• 2:51:20Anthony Pompliano?

  Now you had to meet other requirements or whatever, you know, they, they fill it out to make it. So it's not just, hey, take these eight classes. But yeah, like that, that was it.

• 2:51:27Speaker 02

  Yeah. The unfortunate thing is they're adding, at least at my university, there, this didn't happen with me. They're adding like more bullshit classes you had to take as like a general curriculum kind of thing. Like, one of the things they're going to force you to take in the future is sustainability classes or something. And we already had to take global diversity or global, you know, just like all kinds of these things. It's like kind of political propaganda classes you had to take. So, yeah.

• 2:51:53Anthony Pompliano?

  It sounds good to the board of trustees.

• 2:51:55Speaker 02

  Right. And then you think like, well, what is the actual value we're contributing to the student? Yeah. I actually, I made it a point of principle. I never read a book I was assigned in school.

• 2:52:05Anthony Pompliano?

  That's a pretty good strategy. I mean, look, there's good books that people may discuss, but for the most part, that are probably not the ones that you're interested in, right? Yeah. It's, um, I don't know. It's a weird thing. Would you do college again?

• 2:52:21Speaker 02

  It's, that's an interesting question because you have to approach it from the perspective of.

• 2:52:27Speaker 02

  Not knowing what I know now, but I know now, even if I forgot everything I know about computer science, I know now how I could teach myself those things, or what kinds of opportunities and networking things I could do to give myself a leg up and go through things I've gone through much faster. I wouldn't know that when I was 17, and I also wouldn't know, like, I don't know if I'd have the discipline and the conscientiousness, frankly, to go through that kind of stuff. So I probably would still go through college, but I think if I had a different kind of degree, I probably wouldn't. And if I could like know what I know now about just like how to learn, I wouldn't go through college.

• 2:53:05Anthony Pompliano?

  Yeah. I'd go for the parties.

• 2:53:08Speaker 02

  Yeah.

• 2:53:09Anthony Pompliano?

  Like the social experience, right?

• 2:53:10Speaker 02

  Yeah.

• 2:53:11Anthony Pompliano?

  The education, I mean, maybe it helped. One of my favorite experiences from college, I got deployed halfway through school. So I came back and so I walked into some kind of government or politics class, whatever it was. And all of a sudden, somehow like the Middle East came up. And I was sitting there and, you know, my strategy was like, just don't get noticed in class. And probably didn't take it nearly as seriously as I should have or I would now. But the teacher started saying all kinds of like crazy shit about the Middle East and like US relations, like all this stuff and everything. And one of my buddies was sitting next to me and he like tapped me and he was like, like, what

• 2:53:55Anthony Pompliano?

  do you think? And I was like, it's all bullshit. And then of course, like a fucking jackass, right? He raises his hand, he goes, well, he was just there. So like, he could tell us.

• 2:54:05Anthony Pompliano?

  And so like, it was fascinating though, because like, that was like, again, that was one specific instance in, you know, what ended up being five and a half years total from start to finish. But like, I probably was better versed, like me personally than the teacher, talk about that one part of the class. And then it made me think, I was like, looking around the room and we had people from all walks of life, like all these different things. And I was like, Well, what do you think? Right? Like, what do you think? Like, how do like, why can't we make this less of like a lecture where it's one person who's up there who's just been a teacher their whole life? Why don't we all talk? And I bet you I'm gonna be able to learn a lot more from some of these people than I am from the teacher. And so some of it's like, college itself. And then some of it is just like even the the mechanisms that just like replicate what was high school.

• 2:54:51Anthony Pompliano?

  Because it's different in high school. Yes, you could learn from your classmates and stuff, but like, the world experiences aren't nearly as well developed as maybe by the time you get to college. And if you have like freshmen and seniors that are together, right, in a class, it's very different than like, I don't know how many freshmen in high school are learning a lot from their freshman classmates, except for if it's somebody who comes from a different culture, a different place, maybe has different life experience. But like, that's not nearly as much as only been around for 14 years. Yeah, right. Of which you probably remember, you know, less than 10. So like, how much could you really have done? And then be able to articulate those ideas is a little different.

• 2:55:28Speaker 02

  Right. What was the experience like going from these like life and death situations in the military, then to transitioning to college where it's a little bit contrived, kind of, you know, just like, it doesn't seem as visceral as being in a military situation?

• 2:55:48Anthony Pompliano?

  So I was in college, got deployed, then came back to college. Right. So it was like,

• 2:55:52Speaker 02

  What was the transition, like, before and after?

• 2:55:55Anthony Pompliano?

  Going there, it wasn't real at first. Like, I've told sorry before, but was in college, I was playing football, went in, went and got deployed. And so like, you kind of almost feel like it's almost like a game, a little bit. And then the first time that there was like a major event while I was there, somebody got killed. And you then get to the situation like, oh, this is real. Right. It's like, it changed the perspective. But then coming back, I was there with a lot of older guys. So I was 20, I turned 21 in Iraq. These guys probably the average age was like, 27, 28. And so many of them married, kids, had a house, like, just like, life shit, right?

• 2:56:40Anthony Pompliano?

  I was worried about like, what's the party on Friday night? You know, like a couple of weeks before, these guys were really worried about like, how do I pay my mortgage? How to take care of my kids, like whatever. So like, you just like naturally mature in a weird way, like apprenticeship. Right? Like you get exposed to certain things. Um, and then when I came back, like, there was actually like a very barbell response. So on one side, you're a 21 year old kid who went to war and came back, like you are invincible. Right? Fucking do all kinds of crazy stuff. On the other side, you're like, man, like, I should take school more seriously. Right? Like, I'm gonna be here. There's a real world after this. And so like, I became much more serious about like, more like intellectual things or whatever.

• 2:57:19Anthony Pompliano?

  And so like, that's like a weird balance because you're like, uh, you know, hey, you came back and like, you're, I don't know. I got a motorcycle and would fucking fly around and like, act like an idiot, right? And like, not from a sense of like, I was doing anything that was endangering other people or whatever, but like, I would go fast on a motorcycle. And all right. And it's like, cause like, you just felt, you know, uh, implicitly like, you know, you can do anything. At the same time, though, you become more serious about like, hey, I actually want to learn here. Right? And so, uh, it was weird too, because I also came back, uh, and I was only there for one semester with everyone I'd gone through college with. Then they graduated. So now I was with myself and like a bunch of younger people, right?

• 2:58:04Anthony Pompliano?

  And they're not that much younger, two years or whatever. But now all of a sudden, like you're the old person, right? And then like in a college environment, the age bracket is like 18 to 22. So if you are on the higher end of that and you're around, you know, 18, 19 year olds, like that's a pretty big psychology gap, like all this stuff. And then the life experience and all that. And so it was, uh, it was the first time in my life that I kind of was just like, oh shit, we're all like, we all die, we all get old, we all like, do all this stuff. And so it just added a layer of like seriousness, I think of just like, all right, like you don't get to just party and act like an idiot in college forever. You have to like go into the real world. And so like to some degree, like, If more people got, you know, not go to war, but like could understand that, I bet you people would take it more seriously.

• 2:58:48Speaker 02

  Yeah. How old were you when you got back?

• 2:58:50Anthony Pompliano?

  Uh, I came back, I was 21. So I went at 20, turned 21 overseas and then came back.

• 2:58:56Speaker 02

  Gotcha. Yeah, yeah. No, that's, um, when you are in college, you like, you notice the difference between somebody who is like a freshman and senior. And then if you, if you punctuate that with a super intense experience, super life orbiting experience, like going to the military, it just, the, I, I, the psychology, like your discipline, your motivation, what you think is important. I can't imagine like the difference.

• 2:59:19Anthony Pompliano?

  Well, just think 18 to 22 of like an average college student, the difference. And then imagine a 24 year old who has two years of work experience.

• 2:59:26Speaker 02

  Yep.

• 2:59:27Anthony Pompliano?

  Like the 18 to 22 was already crazy jump. 22 to 24 is actually a pretty crazy jump with two years of life experience. Then go 18 to 24, it's like, you know, kid versus, you know, a young adult, right? Like it's completely different. And so I think, uh, those years are like some of like the highest volatility years, right? And, uh, I don't actually, this is very interesting. I don't know very many people who took, we'll call it the like safe path out of college that reverted back.

• 2:59:58Speaker 02

  Interesting.

• 2:59:59Anthony Pompliano?

  To like high volatility.

• 3:00:00Speaker 02

  That's super interesting.

• 3:00:01Anthony Pompliano?

  Decisions later.

• 3:00:02Speaker 02

  Because that's, that's really interesting. And I'm curious why that is because in tech, you'll notice a lot of people will say when they graduate college, I'm going to work in Google for a few years and I'm going to start my own startup. I'm only saving up enough money that I have a nest egg. Maybe I can like have a few months of runway and none of those people.

• 3:00:19Anthony Pompliano?

  Well, some of them start companies. They just start the safe company. They start the like, hey, I worked at Google for five years and now I'm going to work on ad optimization startup. Like, cool. But none of them go and like, I'm going to build a nuclear power plant.

• 3:00:31Speaker 02

  Yeah.

• 3:00:32Anthony Pompliano?

  Right? Or very like, you know, there's always the, the exception to the rule, but like. There seems to be, over time, a diminishing return to the high volatility kind of path. And so if you're not gonna do it when you're young, you're almost never gonna do it when you're old, except for external shock.

• 3:00:51Speaker 02

  Right.

• 3:00:52Anthony Pompliano?

  Some life event happens and you like get shaken out of one path and then you go on another one.

• 3:00:58Speaker 02

  Right. And that I think is what we're like being in the military when you're young. I don't have that experience, but like I can imagine how valuable that experience would be. Because that's a time when you're like, your brain is kind of still very plastic and you could like, you could accumulate that world, you could accumulate that experience in a way that like changes your personality, which wouldn't be possible later on. I wonder if there's a way you can give more people a similar experience. I guess maybe they can all just join the military, but I don't know. People talk about gap years. I don't know how well they work at doing, making you more serious. Maybe you just need to like work for a year out of high school, just so you become a little more serious, a little more motivated. You have an understanding of how can I be successful and do good things in the world?

• 3:01:42Anthony Pompliano?

  If you strip away obstacles around money and other obligations, right, that there's plenty of people who have to work whether in college, support their families, whatever. But like, just if you say, hey, we got a blank slate, everyone's on the same kind of plane, which is not how life is, but let's just say it was. And you said, like, what are the options of people to go get the seriousness or go get the experience? There is this like ascending level of severity. So on one end, maybe it's like, go get a job. Then there's like travel to other cultures, right, for a week or two weeks or whatever, and get exposed to a bunch of them. Then there's like, go live in another culture. And then maybe there's like, you know, go live in another culture during a time of war, right? Or like, like however like that arc is.

• 3:02:26Anthony Pompliano?

  And ultimately, I think, one, most people don't do it because like, it's weird. It breaks like the societal, like just go to college, like stop being weird, right? And like get your degree and go get a job.

• 3:02:39Anthony Pompliano?

  The highest end of the spectrum, usually the people who are willing to do that are not the people who have other opportunities. It's like, that's another thing, is that most people who join the military when they're young, they're not like, should I go to Harvard or should I join the infantry? Right? Like, that's not, like, that's not the trade-off. And so what naturally happens is like, they get pulled down on the severity curve. Harvard versus military is almost never an option. Maybe it's like Harvard versus West Point. I want to go be an officer or something, right? Harvard versus, uh, go get a job is almost not, maybe a tech company, but like, for the most part, that's not a thing. Harvard versus, like,

• 3:03:20Anthony Pompliano?

  go live in another culture. Again, not likely, but maybe I'll go to Harvard and I'll study abroad for a semester. Right? And so like, people will get some of that, like, weird experience. But again, it pulls in details of the comparison and gets you within that band.

• 3:03:37Speaker 02

  I have this, I know this guy who's, he's a 19-year-old, just genius kid. He's done some really impressive, like, he helped me with the SPF interview, but also, he's like, he's doing some really impressive things. Like, the smartest 19-year-old I know. And so he took a gap year, he worked for Bern Hobart, he's like his second-in-command there. But the, so now he's, now he's considering what to do next, and he's like, I think I'm gonna go to college. I'm like, dude, you have, you could literally, you have a better career now than somebody who goes to, even the most elite universities will have years after they graduate. Like, the amount of people who know who you are and could, like, get you something. But just, um, the social aspect of college.

• 3:04:20Anthony Pompliano?

  Misses it.

• 3:04:20Speaker 02

  Yes. Because for somebody who's already mature, um, at that point, at that age, your, your high school friends are just not gonna, like, have that level of ambition and maturity. But I was arguing, you're not even gonna get that in college. Like, my social life is much better now outside of college than it was in college, just because the people I hang out with are like 26, 30, kind of, you know, older people. And I said, like, I feel like you're probably gonna be similar. And I feel like a lot of these people who are gonna be at the tails. Um, yeah, I, I, I think their social life even would be better outside of college if they can find the right groups.

• 3:04:55Anthony Pompliano?

  Yeah, well, it, it's intentionality versus probability, right? Like you can intentionally go create a social group or intentionally go try to break into a social group. Versus college, like, uh, you ever noticed that in college, everyone just hangs out with the people from their dorm?

• 3:05:09Speaker 02

  Yeah.

• 3:05:10Anthony Pompliano?

  Like, holy shit.

• 3:05:12Speaker 02

  Who they ran into at orientation?

• 3:05:13Anthony Pompliano?

  How much of your lifetime, like, you know, uh, uh, uh, information, like all these different things was determined by like, I don't know, like a random lottery as to like who you got put in is your college roommate and who lived down the hall?

• 3:05:28Speaker 02

  Yep, yep, yeah.

• 3:05:29Anthony Pompliano?

  Right? And so like some of it's like, hey, it doesn't matter who it was. You were going to become friends with people around you because you wanted to have a social life. But a lot of it is like, man, if you think back, like, was that the highly optimized decision? Like, probably not.

• 3:05:42Speaker 02

  Yeah.

• 3:05:43Anthony Pompliano?

  And it takes a lot to be the weirdo who doesn't hang out with the people, you know, doesn't hang out with their college roommate or doesn't hang out with the people in their dorm. And instead intentionally goes and seeks out a different group of, you know, friends that they want to spend time with because they think they can learn from or whatever.

• 3:05:58Speaker 02

  Yeah, yeah, but, but, no, sorry, go ahead.

• 3:06:01Anthony Pompliano?

  Well, it's just like, that's what most people, like, oh, that's a nerd, right? Like, it's just even the way people talk about it. It's like, has like a negative kind of connotation to it, but like, it shouldn't be that way.

• 3:06:10Speaker 02

  Yeah, yeah. By the way, I, I, I heard somewhere that men mature much later than women. When they finish their-

• 3:06:18Anthony Pompliano?

  You can ask my wife, she will confirm that.

• 3:06:20Speaker 02

  Yeah. But when they finish their brain development, and so you have this period when like, uh, people are 18 or 19 or something. And the women are already like, their brain development is complete and the guys are just, you know, like-

• 3:06:37Anthony Pompliano?

  Idiots.

• 3:06:37Speaker 02

  Yeah, exactly. So it, it is like a strange time even that way. Where like, the women are like as mature as like a guy is like when they're 25 or something, right? And part of that is the reason why they seek out like older people as well. But yeah, because the guys at that age are just idiots. Uh, yeah.

• 3:06:55Anthony Pompliano?

  If you think about, uh, again, generalized, but like if you think of the average like 18 to 22 year old male, put into a social situation, like a college party.

• 3:07:06Anthony Pompliano?

  There's like an insane increase of dumb shit that they are willing to do for to make people laugh, to get social status, to get approval, like to do all this stuff. And then you're like, all right, well, if you take that person out and you like put them in like the workforce, they would be just like a normal person.

• 3:07:20Speaker 02

  Yeah.

• 3:07:21Anthony Pompliano?

  Right. It's like some of it's just like social situation stuff, but also like, yeah, you probably did a bunch of shit when you were 18, 22 years old that you would never do 25 or later because your brain just was developed.

• 3:07:31Speaker 02

  Yeah.

• 3:07:31Anthony Pompliano?

  Risk is different, right? Like all that stuff.

• 3:07:33Speaker 02

  Yeah. Let me ask you a question.

• 3:07:35Anthony Pompliano?

  All right, go ahead.

• 3:07:36Speaker 02

  So how does Bitcoin increase the number of?

• 3:07:41Anthony Pompliano?

  I thought we were gonna get through the whole thing with no Bitcoin. All right, go ahead.

• 3:07:44Speaker 02

  Well, I'm curious about this. How does it increase the amount of goods and services in the world? So we talked about like Google Maps, for example, right? It's like, okay, they developed virtual product that makes economic transition, transactions that otherwise wouldn't have been possible happen. It like saves us time. He can use that time to do other things, blah, blah, blah, all kinds of other like benefits. What is that for Bitcoin?

• 3:08:05Anthony Pompliano?

  Well, I think the single most important piece is Bitcoin gives people back their time. So if you think of money, money is just time and you work to get economic value that you then want to hold, the more economic value that you hold, the less that you have to rent out your time or spend your time to get more economic value. So think of it in terms of rich people, they have the freedom of time. They can go do what they want. They could travel. They could spend it however they want. They're not beholden to, I have to go to my nine to five job and make economic value so I can pay my bills and do all this.

• 3:08:40Speaker 02

  Yeah.

• 3:08:40Anthony Pompliano?

  So the more money or economic value that you hold, the more time that you have in terms of free time. The reason why that's important is because today the money loses value. So if I have a hundred dollars in 1990 and I hold it for 20 years, it buys me less goods and services. So there's this constant feeling of like, I can never get ahead. It's the rat race, right? Now, 50 plus percent, 55% of American citizens invest. They have some investable asset. And so the goal is for those investable assets to outpace. The devaluation of the currency. And so, stock market goes up, real estate goes up, commodities, bonds, whatever, right? So I get some ability to outpace it.

• 3:09:25Anthony Pompliano?

  But 45% of Americans have no investments. They just have cash, the paycheck to paycheck, or they just have 100% of their wealth in cash. Those people have gotten worse off over the years. And then if you look in the last two and a half years, inflation is now at, you know, 8.5, 9.1%. But that's on top of the 5 to 7% inflation from last year. So I have this compounding effect. And so while the devaluation of the currency has accelerated, wage growth hasn't kept up. So if you were getting paid $10 an hour in 2019, $10 an hour in 2020, $10 an hour in 2021, and $10 an hour in 2022, you're actually getting paid less money today than you were back in 2019. Because your purchasing power has gone down.

• 3:10:09Speaker 02

  Right, right.

• 3:10:09Anthony Pompliano?

  So what Bitcoin does is Bitcoin just simply says, if you go to work and you earn money, you can now save it and no one can devalue it.

• 3:10:18Speaker 02

  Right, okay. But given the volatility in its price, it sounds like you're saying, correct me if I'm wrong, but that it gives you like a stable way to store your, like a low volatility way to like store your savings.

• 3:10:33Anthony Pompliano?

  It's the single most important thing for a society.

• 3:10:37Speaker 02

  Right, but given the recent volatility in the price.

• 3:10:40Anthony Pompliano?

  There is no volatility.

• 3:10:42Speaker 02

  Okay.

• 3:10:43Anthony Pompliano?

  People, the only volatility is how many dollars people are willing to give you for it. It's the exchange price that's volatile. Is the dollar volatile?

• 3:10:52Speaker 02

  Less than Bitcoin, yeah, but.

• 3:10:54Anthony Pompliano?

  I would argue it's not. Because if I had, let's say, $10, and I wanted to go buy goods and services in 2020, January of 2020, and I showed up today and I wanted to buy $10 worth of goods and services, I could buy less, right? The dollar has devalued against those goods and services.

• 3:11:11Speaker 02

  But couldn't you say the same thing about Bitcoin? Like if you're using that as a way to, if you're comparing that to goods and services.

• 3:11:16Anthony Pompliano?

  Bitcoin in 2020, if I have the one Bitcoin, right? And now I try to go buy something, I can buy more goods and services with that one Bitcoin. The purchasing power of Bitcoin appreciates over time, the purchasing power of the dollar depreciates.

• 3:11:30Speaker 02

  So it could be that it increases in value over time, but also that it's more volatile.

• 3:11:35Anthony Pompliano?

  But it's not volatile. That's the key, is we think of volatility as an exchange rate.

• 3:11:43Anthony Pompliano?

  Right? So for example, people look at the housing market.

• 3:11:49Anthony Pompliano?

  How many dollars will somebody give me for this house in 2019, 2020, 21, 22? But the house is not volatile. The house is a fucking house, got four walls, got a roof, and people still live in it. The volatility is the exchange rate $2. Now, that's how finance is based, right? So it's not like, oh, we shouldn't think about, you know, exchange rates or anything like that. But when you price the home, you don't say like, it's worth one home, now it's worth two homes, right? You say, no, it's worth, you know, $100,000, it's worth $125,000, it's worth $75,000. So there's an exchange back into a common unit of account.

• 3:12:24Speaker 02

  Okay, but if you take dollars out of it, I would just say, how many apples could you buy with one Bitcoin? That amount, again, is still an exchange rate, but even if you take dollars out of it, even compared to goods and services, it seems overall tied then.

• 3:12:37Anthony Pompliano?

  But it's volatile to the upside, where the dollar is volatile to the downside.

• 3:12:41Speaker 02

  Yeah, unless you bought at the peak.

• 3:12:44Anthony Pompliano?

  Well, if you're trying to optimize on a single day-to-day basis, like basically, if you say, hey, I bought one Bitcoin today, and then I try to spend it in a week, you're a day trader.

• 3:12:53Speaker 02

  Yeah.

• 3:12:54Anthony Pompliano?

  Right? But nobody says, oh, I got $112 months ago, and now it's down 10% in purchasing power, right? Like, the dollar is horrible, and no one should use dollars.

• 3:13:05Speaker 02

  But the 45% of people you mentioned who don't have any investments, they're probably the kind of people who don't, who are, who can't just hold for a long time. Like, they're the kind of people who need to be liquid on a very regular basis. Like, they get a paycheck, they need to use it. So for those kinds of people, how is Bitcoin a solution if you need to hold it for a long time to see that upside?

• 3:13:26Anthony Pompliano?

  Well, the first thing is Bitcoin is a technology solution. The actual solution to most people's problems is financial education. Right? So if you think about it, like, most, the 45% of Americans, if they knew, hey, those dollars you're holding are eroding away in purchasing power, and you literally are getting paid less money than you were two years ago, like, they probably would make changes, right? Or the theory would be that if they had the education, they would make changes. The first problem is, like, they just don't know that. And so like, why don't we teach that in school? Right? Like that, like better than teaching like all the bullshit. Like, why don't we just teach people, hey? The currency is created in a way where it has to be devalued. And therefore do not hold this for a hundred percent of your wealth for very long periods of time.

• 3:14:08Anthony Pompliano?

  Right? And so this also goes back to the whole thing of like, I don't think there's very many people that say like, hey, Bitcoin today is a superior means of payment. And like, you should go take a hundred percent of the money you want to spend tomorrow and go put it in Bitcoin and like, hope it doesn't go up or down.

• 3:14:22Speaker 02

  Yeah.

• 3:14:22Anthony Pompliano?

  Right? I think instead where you're seeing a lot of adoption is actually as a store of value. So a lot of people are coming in and you see it in the data, like 60 plus percent of Bitcoin in circulation hasn't moved in a year. Right? So people are, for majority of the Bitcoin that is held by folks, they're buying it and holding it for long periods of time.

• 3:14:41Speaker 02

  Okay.

• 3:14:42Anthony Pompliano?

  And so the theory, and again, takes time to see if this plays out, is that you have, as a currency, you have to establish yourself as a store of value before you can ever become a means of exchange.

• 3:14:51Speaker 02

  Okay. But so you, you think eventually Bitcoin will be a medium exchange?

• 3:14:55Anthony Pompliano?

  Well, let me ask you this. Do you trust computers or people?

• 3:15:00Speaker 02

  For what, I guess, would be the question?

• 3:15:02Anthony Pompliano?

  For, well, forget for a second what you think. You trust computers over people for majority of things in your life.

• 3:15:08Speaker 02

  Sure.

• 3:15:09Anthony Pompliano?

  Right? Like your music recommendations, your search results, your maps, like all these different things.

• 3:15:13Speaker 02

  Yeah.

• 3:15:15Anthony Pompliano?

  Today, billions of people around the world put faith in 12 people at the FOMC to fucking guess the future.

• 3:15:24Speaker 02

  Yep.

• 3:15:25Anthony Pompliano?

  Talk about something that exists today that a hundred years from now, we're gonna look back and be like, what happened? Like, there are 12 people who are not elected by the people, they're just appointed, that go into a conference room and they periodically look at a bunch of data, which usually is backwards looking data. And there's a lot of problems with the data. And they lick their finger, put it in the air, and they say, we think we should do X for the future. And like, you don't have to look very far. Just look over the last two years. These people have no clue what's going on. Right? And one of my favorite examples is like, if you asked a five-year-old, positive or negative, talking about GDP for a quarter. It's a 50/50 shot.

• 3:16:09Anthony Pompliano?

  Like, like positive, negative.

• 3:16:13Anthony Pompliano?

  In the last two quarters, the economists had said positive and it came in negative.

• 3:16:19Speaker 02

  Yeah.

• 3:16:20Anthony Pompliano?

  So like, again, I don't expect people to be like, oh, they have to always get, you know, if it's 1.2, they have to get 1.2 right. Of course, it's hard. It's a complex machine. There's moving parts. There's tons of data that changes, whatever. And if they say 1.2 and it comes in at 1.4 or 1.0, like, okay, sure, they at least directionally got it right. But when you start to see like, they think it's positive, because it's negative. It's like, why, like, who cares what they say next time, right? Like, they have no clue.

• 3:16:49Anthony Pompliano?

  But it's not their fault. Like, I don't think there's like some grand conspiracy where they like go in a room and they're like, you know, it'd be fucking our best strategy. Let's say positive, even though we think it's gonna be negative. Like, I literally think they think it's gonna be positive. And then stuff goes wrong. And so the reason why I say that is like, if automation is a very non-controversial thing, the single most important institution in your life that is human-led, that fucks up your life, is central banks. Not because they want to, but that is what happens. So why don't we automate it? Well, Bitcoin already did that. The most disciplined monetary policy over the entire COVID inflation recession, all this shit, has been Bitcoin. It's the only one that

• 3:17:31Anthony Pompliano?

  didn't change. Everyone else changed. The Fed, they pivoted, then they went QE, then they came back, now they're doing QT. The ECB said, we're not gonna do QT. Oh, now they're doing it. We're not gonna take our interest rates from negative to zero. Like, all these things, they all changed their minds.

• 3:17:48Speaker 02

  But still, relative to goods and services, the exchange rate is less volatile for the, given all this volatility and how people react.

• 3:17:56Anthony Pompliano?

  So volatility, not good or bad, works in both directions, right?

• 3:18:00Speaker 02

  But it is bad in the sense if you just want to be able to, you know, if you want the liquidity.

• 3:18:06Anthony Pompliano?

  It's volatility by itself is not bad. If volatility to the upside like Bitcoin, right, is actually a good thing if you're holding Bitcoin, right? Because everything around you gets cheaper. And so if you go back to January 2020, before everything happened, and you said, knowing everything we know now, you can put your assets in one currency, you put in Bitcoin.

• 3:18:27Speaker 02

  Do you still think that Bitcoin is a good inflation hedge? Or?

• 3:18:30Anthony Pompliano?

  I think that what we are learning, like Bitcoin served as a fantastic debasement hedge. And I think over time, like my views have evolved on this, and I think the market is just getting smarter as we get more data, which I think is a healthy thing.

• 3:18:48Anthony Pompliano?

  Inflation hedge assets are actually a very interesting thing. Inflation hedge assets move before the inflation comes. Right? So like, one of the things that people forget is like, if I think inflation is coming, I do not wait for the inflation to get here and then move my assets. I move them in anticipation. So this is why in Q3 and Q4 of 2020, you saw Paul Tudor Jones, Stanley Druckenmiller, like all these like Wall Street legends talking about, we think inflation is going to be high. We're going to go and we're going to put our assets in inflation hedges. Paul Tudor Jones famously said, you know, Bitcoin is going to be the fastest horse in this bucket.

• 3:19:20Anthony Pompliano?

  Well, guess what Bitcoin did? It went from $10,000 to $64,000 in a matter of like five months. Right? Well, that tells me that there was a fixed supply asset, tons of demand coming in. Inflation was still like 2%, 3%. We didn't get the first 5% CPI print until June of 2021. So Bitcoin moved before, and then here came 5% for, you know, what is now over a year. Now Bitcoin has also come down since November. It peaked at $69,000 in November and it's now trading called 20, 23,000, whatever it is. Why did it come down? Inflation is still high because markets are forward looking. So just like, why did the stock market come down? It's because the Fed said we are going to destroy demand.

• 3:20:06Anthony Pompliano?

  And the second they started to say that, what did sophisticated investors do? Like, we're fucking out.

• 3:20:10Speaker 02

  Okay, so you think the reason, one of the reasons Bitcoin declined is the prospect for inflation went down?

• 3:20:17Anthony Pompliano?

  Not the prospect for inflation. It's that the Fed is signaling that they are going to do everything it can to create tighter financial conditions and they're going to destroy demand. And so, again, it's, it's pretty unique in that like Bitcoin hasn't been any different than other assets. Right? In some way, when you have market intervention, like we have, especially over the last two, two and a half years, all asset correlations start to trend towards one. So Bitcoin up until 2020 was like a non-correlated asset, right? Correlations were, you know, 0.15 or whatever. It's just, it's a math equation. It's not up for debate. Like you just measure the math. In 2020 until today, correlations have gone through the roof. And now you just overlay, you know, S and P and Bitcoin or S and P and NASDAQ or whatever.

• 3:21:01Anthony Pompliano?

  And they just trade like almost lockstep. But so do a lot of assets because what's happened is we have a manipulated market and sophisticated investors treat all of the assets in a similar fashion. Right? In March of 2020, Bitcoin's correlation to other assets went through the roof. There was liquidity crisis. People sold everything and they wanted dollars. So if you think of it today, the dollars at a 20 year high against, you know, the dollar index against other fiat currencies, people want dollars. So if people want dollars, the dollar strengthens. Well, if all these other assets are priced in dollars, everything goes down.

• 3:21:38Speaker 02

  Yeah.

• 3:21:38Anthony Pompliano?

  Right?

• 3:21:39Speaker 02

  I guess if you're looking for a hedge, you probably want it to be not correlated to other assets you might, you might, you hold.

• 3:21:45Anthony Pompliano?

  The problem is that there is no asset right now. Right? In these situations, like basically what we're watching, so 2020, this is like a unique, I think that we're still in the middle of. So it's still a changing environment. 2020 was a very short recession. It's probably with the shortest on, on record in that we got two consecutive quarters of negative GDP growth, but it was down and right back up. And that's because of the intervention by central banks and politicians with monetary fiscal policy. But correlations went to one. Right? And so that was a liquidity crisis where people were scared. They wanted dollars. They didn't want assets. They sold them off. Everything goes.

• 3:22:26Anthony Pompliano?

  If you go back to 2008, there was a six month liquidity crisis where people were selling assets. Gold went down 30% in summer of 2008. Right? Then government stepped in and we went back up and by 2011, gold hit a all time high. So liquidity crisis can be like super acute and short, like they were in March of 2020 into April of 2020, or they can be six months, you know, whatever. In some weird way, it's not like a, a acute liquidity crisis, but basically what we've been in since, you know, November, December of last year is a version of a liquidity crisis where people are saying. I don't want to have risk on because I hear the Fed, the Fed's in control. Don't fight the Fed.

• 3:23:07Anthony Pompliano?

  They're going to destroy demand and they only are going to get more and more and more bold if inflation stays high and their actions aren't working, which is where we are. We're in this stagflationary period. So in some weird way, everyone who's going to sell Bitcoin already has, right? Now, sure, there's day trading, there's, you know, whatever, but all of those hedge funds, they all were selling, right? You can see Tesla, like, like, all of the people who were looking at this as one of many assets, they sold it. They're like, hey, look, we need liquidity, we need this, we're scared, we're whatever. But like, it's six at $20,000, you know, or give or take a couple thousand dollars on either side.

• 3:23:51Anthony Pompliano?

  It's because you have a holder base that like, Bitcoin goes to a thousand bucks, they're not selling, right? And so it's like this very weird asset because the more that quantitative easing and like the debasement and all that stuff is talked about, the higher Bitcoin goes. But Bitcoin, what it appears, given now, doesn't care so much about the actual inflation as much as the anticipation of the devaluation and the inflation.

• 3:24:19Speaker 02

  Okay.

• 3:24:20Anthony Pompliano?

  So people move the assets before it happens. And then once it happens, like inflation's here now, right? Everyone's like, oh, why isn't Bitcoin going up? Well, it's because they're looking forward and the Fed's saying, we're going to crash everything, right? And so what ended up happening is they crashed everything.

• 3:24:35Speaker 02

  Okay. But so, does it imply you're not so worried about inflation in the future because you see the price of Bitcoin moving? Or you see that it's moved down, I guess, anticipating and pricing in the inflation in the future being brought down by the Fed? So are you less worried about inflation now than you were before?

• 3:24:53Anthony Pompliano?

  I don't think that my expectations of inflation change based on what happens to Bitcoin's price. I think Bitcoin's price changes because of the expectations of inflation, right? Which is like a weird nuance, but it's less about like, oh, I see Bitcoin do X and therefore now I think something different about inflation. It's depending on what I think is Going to happen with inflation is why Bitcoin's price moves. But really, it's not because of the inflation as much as it's what is the Federal Reserve's response to that inflation movement? So a great example is, we're recording this in August of 2022. And we just got the CPI print this morning. It came in at 8.5%, which is lower than the 9.1% from June.

• 3:25:35Anthony Pompliano?

  There's a lot of people who are celebrating, saying, oh, my God, this is amazing. We now have inflation going down. That's not what happened. Month to month, inflation was flat. The month to month changed, there was no change. It's that from June to July of last year, inflation moved upwards. And so now what we're seeing is base effect. So yes, year over year change in inflation appears to be lower. But it's not because the inflation from June to July changed. It's just because inflation was going from three to five and then eventually 7% in December of 2021. So now we're getting compounding effects. So if we get to, I'll make up numbers, let's say that we get to December of 2022 and inflation is at 7%.

• 3:26:21Anthony Pompliano?

  Which he would say, well, we're at 8.5% in the July reading. If we get to seven, that means we're heading in the right direction. Yeah, but that means we compounded at 7% for two years.

• 3:26:29Speaker 02

  Yep, gotcha. You're not getting back the value you lost.

• 3:26:32Anthony Pompliano?

  Like, holy shit. By the way, like Chipotle is not lowering their prices, right? Like, like no one, none of the price increases are going back.

• 3:26:40Speaker 02

  Yep.

• 3:26:40Anthony Pompliano?

  And so you have this like really weird thing where at the end of the day, does the number actually matter? Like, I think that's like the important question. Is there a difference between 8.5 and 9%? Well, like in the official measurements, like it's all kind of manipulated data, right? And so if you even look at the CPI basket itself, like this, this is the deeper you go into this, the more you're just like, this is all fucking woo. 33% of the CPI basket is made up of something called shelter, which is estimated right now to be between five and a half and 6% year over year increase. But rents and real estate are both up 12 or more percent year over year. So what goes in the shelter bucket?

• 3:27:24Anthony Pompliano?

  Like, how is it that you're counting in the CPI official measurement 50% or less of the value of the increase in rent in real estate? Like, where else are people, if they're not renting, if they're not buying, like, what else are they doing? Right? And so they created all kinds of bullshit metrics, like owner equivalent rent and like all this like nonsense. But if you actually go and you read it, and probably one of the scariest things if you read the CPI methodology, the CPI rent index is determined based on 1980 census data. And they just call people and there's like 30,000 or 60,000 homes that they've pre-identified based on the 1980 census data. And they rotate through them, right?

• 3:28:09Anthony Pompliano?

  So they maybe call like 10,000 every time or whatever. And they just say like, hey, what, what, what are you paying for rent? Which sounds like, okay, maybe that's the best they can do. But we have Zillow, apartment.com, Square, like, they have real time data. And I think Zillow says they have 100 million data points in real time. Well, guess what their rent index says in the teens, right? Or apartment.com, I think is like 14%. I think Zillow was like 10% or something, like whatever the numbers are. They're like way higher than what this is showing. And so it begs the question, like, is it a data problem? Is it a methodology problem? Is it a presentation? Like, it's probably all of it, right? But then it comes back to, none of that matters because they're looking at the CPI metric.

• 3:28:53Anthony Pompliano?

  And what they're saying is, we have increased interest rates and we are conducting quantitative tightening and inflation is persistently high. They're going to keep bringing the hammer until one of two things happens. Either inflation comes down or there is so much pain in the economy that they give up.

• 3:29:08Speaker 02

  It's politically impossible.

• 3:29:09Anthony Pompliano?

  Yeah. And I think that that's what's going to happen. I think they're going to give up.

• 3:29:14Anthony Pompliano?

  I'm not predicting what will happen, but I think that they will do it sooner than people realize because it sounds good to talk tough midterm elections.

• 3:29:23Speaker 02

  Hmm.

• 3:29:24Anthony Pompliano?

  It's gonna be real hard to go into a midterm election with the current administration saying, oh, we know that there's high inflation and we know that we caused a recession. Vote for us.

• 3:29:33Speaker 02

  Yeah, yeah, yeah. What do you think is gonna happen in the midterms? That because flood?

• 3:29:39Anthony Pompliano?

  I, I, I don't pay attention to like individual races, you know, or anything like that in terms of like, oh, who's gonna win this or this candidate or that candidate. Uh, it's just not interesting to me. Um, but I think that there's a pendulum swim, uh, swing in society where, uh, we went to one extreme with, uh, there's a bunch of different labels you could put on it, whether it's, uh, uh, kind of the, the woke stuff or like whatever, like it's just like, it's very obvious, like the pendulum swung one direction and I think it's swinging back.

• 3:30:09Speaker 02

  Hmm.

• 3:30:10Anthony Pompliano?

  Um, and so just naturally like, there's a lot of people who feel that sentiment shift. I think that's why you see Elon Musk, Jeff Bezos, like starting to be, talk a lot more about politics and they just, they sense it. Um, that would likely lead to, you know, kind of this like red wave or whatever in the midterm elections. Uh, but I always go back on politics of like, presidents really can't do that much.

• 3:30:35Speaker 02

  Hmm.

• 3:30:36Anthony Pompliano?

  Like, yes, they are the most powerful person in the world, but like, people were really, really scared of Donald Trump. And then people on the other side of the aisle were really, really scared of Joe Biden. What have either one of them done? Like, sure, that, yes, you can point to specific piece of legislation or whatever, but like, what did they do that like fundamentally changed the course of, you know, America? And sure, the extremes of both sides will point to certain things, but oh my God, can you believe they did whatever? But like, if you actually look at like structurally, there's checks and balances, although we for like, we, we forget that, we like to, you know, executive powers, like all this stuff, whatever. And so it's just really hard for politicians to like get shit done, which is also why then

• 3:31:16Anthony Pompliano?

  I think like the private market is so responsible for driving solutions is because like the bureaucrats.

• 3:31:25Anthony Pompliano?

  The system is designed for them not to be able to do shit. Right? So we need entrepreneurs to be able to solve the problems.

• 3:31:30Speaker 02

  Yeah. Yeah. So it's really interesting. If you think, you know, people say that the president is really powerful, but what interesting question to ask is, what is the difference in outcomes between one person becoming president and another person becoming president? And if it's not that much, then you, then the question is, well, who is the person where if they didn't exist, there would be a big difference, where there's a big counterfactual difference? I think we said Elon Musk is one of those people, right? Like thousand years.

• 3:31:55Anthony Pompliano?

  The best entrepreneurs.

• 3:31:56Speaker 02

  Exactly.

• 3:31:57Anthony Pompliano?

  It's like that. That is the biggest difference in society. If Jeff Bezos didn't exist, you wouldn't have Amazon.

• 3:32:03Speaker 02

  Right.

• 3:32:04Anthony Pompliano?

  If Elon Musk didn't exist, right? Like, and I don't know how many there are. There are five people or there are 50 people or there are 500 people. There's some number. But almost all of them are not politicians. Like, I'll say private sector, but like, you could say they're scientists. There's, you know, whatever, but like, they're not politicians. And it goes back to how many of your smartest friends are wannabe politicians?

• 3:32:27Speaker 02

  They're not my friends.

• 3:32:29Anthony Pompliano?

  You're just laughing, right? Like, nobody that I know is like, my smartest friends want to be politicians. Now, it's not a knock against people who want to be politicians, because actually, I hope that they are somebody's smartest friends. Like, actually, that's what we would want. And if you think about in, you know, ancient Rome and all, like, it was a very like aspirational thing, but I think in some weird way, like meme culture has destroyed institutions. And like politicians, I mean, like, there's literally Twitter accounts that are like, tracking the day trades of a politician. Like, it's like, this is a joke. Like, you're just like us. Like, shut up.

• 3:33:05Speaker 02

  Yeah, yeah, yeah.

• 3:33:06Anthony Pompliano?

  And so in some weird way, you, you,

• 3:33:13Anthony Pompliano?

  why would you go do that? If you're intelligent and you could solve real problems, you could make money, you could like, do all this stuff. Like, why would you do it? And sure, there's some people who are like, oh, I believe that this is the place for change. But there's not very many people who are like, yeah, this is the place to create change.

• 3:33:27Speaker 02

  Yeah. I think one of the things over history that matters a lot is what do the young, talented people want to do? And what are the options for them? You'll always have people in a society that are really ambitious and smart. And these are the kinds of people who are like founder types. Over but throughout most of history, these people were like warlords or, you know, military and that was bad for society, obviously, right? Because like being a warlord is a negative sum game. I mean, if you think of somebody like Napoleon, the guy was insanely brilliant. He was basically, as it is today, he would be like a great startup founder. Just the ability to think about micromanage, the economy, the military, the strategy, everything. Actually,

• 3:34:10Speaker 02

  there's a funny example where he tells an Austrian diplomat, listen, you're not going to win. I'm willing to lose 60,000 men a month. Right? And I was thinking, that's very similar to if like the Uber CEO told the Lyft CEO, you're not going to win. I'm willing to burn a billion dollars of VC capital a quarter.

• 3:34:28Anthony Pompliano?

  Well, Jeff Bezos did this with diaper.com and many others, where he literally said, I'm just going to lose money on every diaper I sell until you sell me your business.

• 3:34:36Speaker 02

  Right. Oh, what was that story with, can you remember the name of the Japanese investor?

• 3:34:42Anthony Pompliano?

  Masayoshi.

• 3:34:43Speaker 02

  Masayoshi, was it YouTube? Or I forget the name of the company, but basically, he asked them.

• 3:34:48Anthony Pompliano?

  It was Uber.

• 3:34:49Speaker 02

  Uber, okay. He was, he was, said, I want to give you a hundred million dollars. And they're like, we don't need a hundred million dollars. And he's like, okay, well, who are your top five competitors? And they're, they give the names and he's like, okay, either you take my money or I'll give them a hundred million dollars.

• 3:35:02Anthony Pompliano?

  Neither one my bazooka pointed at you or behind you.

• 3:35:08Speaker 02

  Yes. So yeah, but hopefully over time, people, the smartest people will realize, I can make a lot more impact on the world by pursue like building businesses, but building good services for people. The problem is if none, yeah, like you said, if none of the smartest people are going into politics, you have a problem where the biggest impact that politics can have is preventing people from building useful goods and services. Right? So if you think about nuclear, there's a great example of this, the FDA is like, it's my opinion that a lot of drugs that could have improved quality of life have just basically been prevented by the FDA's long and convoluted process. So yeah, hopefully as few of those kinds of people actually just like make sure that things can pass

• 3:35:53Speaker 02

  through the bureaucratic filter.

• 3:35:54Anthony Pompliano?

  You want to hear a crazy idea?

• 3:35:56Speaker 02

  Go for it.

• 3:35:57Anthony Pompliano?

  One of the fastest paths to being a celebrity in today's society is for a young person to become a politician.

• 3:36:02Speaker 02

  Like AOC or something? Yeah.

• 3:36:05Anthony Pompliano?

  Right? Like they're celebrity politicians now.

• 3:36:07Speaker 02

  Yeah.

• 3:36:07Anthony Pompliano?

  And, and look, by the way, I'm always very clear, like Donald Trump was one, AOC was one, right? And so just like, if you have congressperson or senator in front of your name, the press will write about you. Like you have a fast track to celebrity. And so the like TikTok, social media generation, there's a lot of those people are gonna go try to be politicians.

• 3:36:31Speaker 02

  Yeah.

• 3:36:31Anthony Pompliano?

  Right? Because it is a path to doing it. Now, it's not all of them, but like, the incentives are weird.

• 3:36:37Speaker 02

  Yeah. I do wonder if, like, I guess I don't talk to, I don't have like a good sample of people my age. But I do wonder how many of them are thinking of the world in terms of, uh, I want to go into politics and make like political change. The thing is, in public education, the stories you're told are like, who impact stories? You don't hear of Borla or Haber, or you know, all these great scientists who have like allowed billions of people to live. You hear about, you know, like activist movements. These movements have been important, no doubt, right? But if that's your only conception of history, that basically we give people moral rights. And that's the only thing that's changed our history, that's our progress is? That's a very incomplete picture of history. And obviously that reinforces what people think is important to do with their careers, right?

• 3:37:22Speaker 02

  Like, if that's what you think, you're gonna want to become a politician or something.

• 3:37:26Anthony Pompliano?

  Yeah, well, and also, uh, why become a politician if you can affect more change in the private market?

• 3:37:31Speaker 02

  Right.

• 3:37:31Anthony Pompliano?

  Like, like we celebrateize Bezos and Musk and, you know, name all these people. Because they're actually the ones that create change.

• 3:37:38Speaker 02

  Yeah, yeah.

• 3:37:38Anthony Pompliano?

  Like Elon Musk and SpaceX did something that the US government could not do.

• 3:37:43Speaker 02

  For way cheaper and with less time. Yep, it's insane.

• 3:37:46Anthony Pompliano?

  Right? And so like, okay, Andoril is doing something that the US military could not do.

• 3:37:51Speaker 02

  Right. Yeah, yeah, yeah.

• 3:37:52Anthony Pompliano?

  And by the way, like, that's a good thing. That we have people who are able to get capital, use their ideas and like, provide these capabilities. Like, it is a good thing that SpaceX can bring us to space. It is a good thing that Andoril can help protect the United States of America, right? And so like, For the average American, like, we don't give a shit who does it. I just need somebody to make sure that, like, things are good, right? But if the government can't do it, then, like, we should be really fucking happy that there's other solutions out there.

• 3:38:22Speaker 02

  Yeah, and then the positives, like, the white pill on this is, you know, if you look at the media, they're always complaining about, like, people like Musk or Bezos. But if you look at opinion polls, like, Pew Research polls about what do people think about Amazon? What do people think about Musk? They're actually, like, pretty overwhelmingly positive, which means that people understand that you use Amazon every day, right? Like, you understand, like, this guy, basically, is getting you shit for very low cost, very immediately. I'm hoping that the narrative, that the media narrative, you know, these people are actually just basically competitors. If you think about, like, New York Times, it's a competitor to Facebook, it's a competitor to Google. So, obviously, they're gonna have a negative spin. Hopefully, that doesn't...

• 3:39:05Anthony Pompliano?

  They're also a competitor to the entrepreneurs, because the entrepreneurs are able to, basically, expose the bullshit.

• 3:39:12Speaker 02

  Yeah, yeah.

• 3:39:12Anthony Pompliano?

  Like, Jeff Bezos, in the middle of the pandemic, hired 100,000 people.

• 3:39:15Speaker 02

  Yep.

• 3:39:16Anthony Pompliano?

  Right? The average pay of an Amazon worker is over $15 an hour, it's like $17 an hour. So, how is it that Jeff Bezos was able to get it to $17 an hour, but politicians can't even do it in their own states, let alone at the federal level?

• 3:39:29Speaker 02

  Right.

• 3:39:30Anthony Pompliano?

  Like, I always joke, like, why are the politicians undershooting so much? Why do they only want $15 an hour? Amazon already pays 17, why don't you make it 17?

• 3:39:38Speaker 02

  Yeah. I mean, over time, the thing that drives up wages is higher worker productivity, which is made possible by innovations that, you know, make you a more efficient worker. It's like, the people overhype, you know, there's also this narrative of, oh, like, the reason we have better working conditions today than we did in the past, or we work fewer days and fewer hours, is because of labor market regulations. You know, like, people say, like, oh, unions brought us weekends off or stuff. I think the real story is just that, like, you're just, workers are just so much more productive today that it makes sense for companies to hire them for more money. If you get more money, you're willing to work, you know, you're willing to bargain for weekends off or stuff like that. And, yeah, so I think labor market regulations have had very little to do with improvements

• 3:40:22Speaker 02

  in worker conditions over time. I think it's basically been the free market has just made workers more efficient and therefore it's good for workers.

• 3:40:29Anthony Pompliano?

  Yeah, 100% agree. Let's wrap up.

• 3:40:33Speaker 02

  Yeah.

• 3:40:33Anthony Pompliano?

  Where can we send people to find you on the internet?

• 3:40:36Speaker 02

  Yes, so I have a podcast called The Lunar Society. I have intellectuals, scientists, founders come on, and I really like to learn a lot about their discipline, ask them really nuanced, interesting, deep questions. I've had Sam Muckinfree, David Deutsch, Tyler Cowen, those kinds of people on.

• 3:40:56Anthony Pompliano?

  A very wide variety of folks and also very kind of deep, intelligent conversations with them.

• 3:41:01Speaker 02

  Yeah, thank you. And...

• 3:41:03Anthony Pompliano?

  Okay, we will find it.

• 3:41:04Speaker 02

  Yes, it's called The Lunar Society. It can be found everywhere, fine podcasts are sold, no, it's free. And it's, so, Apple Podcasts, Spotify, YouTube, there's a video version on YouTube, so that you can find that there. And we've been talking about some of my blog posts. Those you can find on my Substack, dwarkeshpatel.com. Difficult name, but if you look at the description, you'll see what my, how to spell my name. So just go to dwarkeshpatel.com. And, yeah, I'm dwarkesh underscore SP on Twitter. But The Lunar Society podcast is my main thing, so I'm just gonna speak slowly because I tend to speak fast, The Lunar Society, yep.

• 3:41:39Anthony Pompliano?

  We'll link to it in the, in the description. I enjoy it, so I appreciate you coming in.

• 3:41:44Speaker 02

  Thank you.

• 3:41:45Anthony Pompliano?

  And anyone who hasn't yet, highly suggest, go check out, check out the podcast or follow you on Twitter as well.

• 3:41:50Speaker 02

  Well, dude, I really appreciate you having me on. I really enjoy your content, so I was super, super grateful to be able to come on.

• 3:41:56Anthony Pompliano?

  Well, it went for three hours or so, so...

• 3:41:58Speaker 02

  Yeah, it didn't feel that long at all.

• 3:42:01Anthony Pompliano?

  All right, we'll definitely do it again in the future.

• 3:42:02Speaker 02

  Yeah, man, awesome.

• 3:42:04Anthony Pompliano?

  Thanks so much for listening to today's episode. I really hope you enjoyed this one. Make sure you're subscribed on Apple, Spotify, or your favorite podcast player. And if you're looking to transition into a brand new job in the Bitcoin or crypto industry, we've got you covered. Head over to thecryptoacademy.io. My team and I have been working with the top HR teams in the industry to develop an intensive three-week training program with over 50 live events. We teach you exactly what you need to know to break into the industry, including live interview prep and resume review. Our students have been hired at over 75 of the world's best Bitcoin and crypto companies. Go to thecryptoacademy.io to learn more. Again, that's thecryptoacademy.io. If you enjoyed today's episode, make sure you share it with your friends and I'll see you all for the next episode.