just a couple questions before we kick off okay look that's what i told you before it's bad o'clock okay it's thick 30. i've been through a lot sax right now but i'm still flirty okay is everybody back up in the building sax it's been a minute tell me how you're healing because i'm about to get into my feelings how you feeling sax how you feel right now what language are you speaking right now you're right remember when you had at your 50th oh yeah when you had and she sang and she sang and your was dancing to beep delete that delete that let's start executing the insta strike with jake why insta strike when he says something that we just insta strikes we don't have to edit it later just insta strike it's because um i am uh taking back my power i was in therapy the other day and they told me i need to take back my power insta strike but he apparently reads the comments section because he knew friedberg that you won the episode last week oh big time which i agree with i thought you did i agree too it was big friedberg energy finally i honestly do not like the competitive nature of the show i think it makes us all hate each other and it's not a good dynamic we should just do the show with each other i know but the point is your performance after i threatened to fire off the show has gone up you know who also doesn't like the competitive nature jacob because he's losing yeah totally the fact that i'm even still here is winning i love how jacob thinks he can threaten to fire freeburg it's like the janitor at staples center think he's gonna fire lebron because he played poorly in a game this is a motivational technique i got the best out of him i'm like michael jordan he's my dennis rodney you're like the hot dog dealer okay pal he's like lebron james you're the hot dog i do not insta strike these comments don't let your winners ride all right everybody uh welcome to the all in pod uh with us again uh david freeburg took a break from playing his stray video cat game uh sax is here in his deposition apparently chamomile do you guys want to see this look at this size of this jcal's apparently playing no comment today on the comments so i will open the show i will open the show by asking david sacks would you like to tell us about what you're holding in your hand yeah okay so i got this subpoena from twitter this is a non-party subpoena for didn't twitter subpoena your tweets yes let me get into that this is subpoena i thought they're public they are these nitwits have walked out lifted and billing them with probably two thousand and twenty-five dollars.

thousand dollars an hour to subpoena tweets that are public i mean brilliant brilliant strategy but this is called a subpoena for production of business records in an action pending outside california so i'm not a party to the laws at least they're not suing me because i have no involvement in this thing but they sent me the broadest ever subpoena it's like 30 pages of requests and now i gotta hire a lawyer to go quash this thing because they basically want any of my communications with any of my friends over the last six months and they're like i'm gonna go to the court in the next two months it's insane sax can you just explain to the audience and to us like is this is a court sanctioned subpoena the court is basically allowing the lawyers to demand that you hand over these communications is that right yeah but i haven't had a chance to fight it yet so now at my own expense i gotta hire a lawyer and go send them to fight it because this is a ridiculous overbroad subpoena and by the way i'm not even involved in this thing i'm just a commenter on twitter um i don't have any let me just save walk tell lipton a lot of time right now i'm not in possession of non-public information about this and you know the craziest thing is yeah like you mentioned they cite my tweets as a as an exhibit here and they say they want all documents and communications concerning your statement in a tweet dated april 16th that the quote new twitter ceo checklist includes eliminate all bots and fire useless employees 50 percent of the time they're not going to be able to get the job done and they're going to be able to get the job done and they're going to be able to get the job done and they're going to be able to get the job done and they're not going to be able to get the job done and they're going to be able to get the job done and they're not going to be able to get the job done and they're so obviously they didn't like that uh your statement in a tweet dated april 25th crazy thought what if jack masterminded this whole thing your statement in a tweet dated july 18th that quote randomly sampling 100 accounts a day is not a serious effort uh and or your statements in any other tweet concerning the merger blah blah let me just save them time right now i don't have documents and communications concerning my tweets now i know to a lawyer at walktel lipton that looking at my tweets and how brilliant they are you may think that i have extensive documentation and source material for them but let me tell you what happened i went to go take a and i basically tweeted off the cuff and that's how that tweet ended up in the public record there are no documents and communications concerning my tweets and this idea that somehow i guess what they're trying to get at is that they're not going to get the job done and they're not going to get a job done and they're not going to get the job done and they're not going to get the job done and is that somehow i was tweeting on behalf of someone or at someone's behest not true go look well before this year at my public tweets and blogs about the topic of free speech i've been a critic of twitter's for a long time on the issue of free speech i've written a um a content moderation policy i've written about what i think a content moderation policy for a social network that cares about free speech should be you know i've written all these posts on medium going back years now you know i was a critic of twitter throwing donald trump off the platform so these views that i've publicly stated are the reason i've stated them is they're just my views and there's just nothing more nefarious or something behind them other than that and they're just i think they're just trying to chase a there that's there is no there there right so let me just say everyone a lot of time you and i can talk because our our friends have no comment on this matter yeah one question i have a follow-up question during this movement that you had and you composed the tweet is there any documentation of the movement no but uh you know next time that i compose a tweet on the can i will document it thoroughly and i will send the lawyers that walked out lipton what happens if you don't respond in 20 days i don't know i mean i gotta i mean now i've hired a lawyer but by the way just so people understand you may think that because of my position in business or something that these things happen all the time they don't i've been maybe subpoenaed like three times in my entire career and the and i've never been subpoenaed in my capacity as an individual it's always been in connection with a company and i don't think i've gotten one of these in over five years so this just does not happen that often these guys are totally chasing at straws and it leads me to believe they're they're wasting my time and twitter's money and they're trying to somebody at twitter should just rein in their lawyers because they're i'm sure racking up a fortune in legal fees it sounds like um sax the case is that they're trying to make that elon used his network of friends to help wash away the deal because he didn't like the price anymore and had his friends you know kind of tweet about bots and other stuff to support his case for killing the deal because he didn't like the price and they're trying to see if there's any communications that he specifically said he didn't like the price yeah i mean look they all in addition to my tweets they want all my documents and correspondence related to my appearance on megan kelly my appearance on the will kane podcast and you know other media appearances i've done look you know i had no coordination with you elon before appearing on any of those shows i just went on those shows and said what i think i mean look it's not like i'm a guy who doesn't have hot takes every single week on various issues you know we do that we've been doing this podcast for years i've been tweeting for years i'm just a commentator on this i have i've never been in possession of non-public information and i've tweeted my takes based on the public information that's been available about this dispute now you know after i heard for example on will kane i remember elon tweeted in support of my appearance but there was no coordination before i appeared or after for that matter he just liked the appearance yeah so it's just me spouting off doing what i've been doing on this pod and tweeting for years now i can understand if maybe they're trying to read something into it they're on a fishing expedition but i've just told you i just think the truth is the whole thing is just such an enormous waste of time just get into court adjudicate the thing and move on i was reading um yesterday this guy who follows the delaware courts pretty closely he had a bunch of commentary and it he mimicked some of the stuff or the judge apparently on the case said some stuff about preserving the integrity of the court meaning that the interpretation people are making is that ultimately they don't want to the court is unlikely to try and force the merger because if the merger then doesn't get consummated it damages the reputation of the court's ability uh to make it happen and then it's just a matter of time before it gets done i just think that's the way it is and i think it's a very important point i think i think it's a very important point and i think it's important for the court to make a decision about what they want to do it's not a matter of time because it's a matter of time before it gets done i think the court is a very important point and i think it's important for the court to make a decision about what they want to do and it's not about the court's ability to make a decision about what they want to do it's not about the court's ability to make a decision about what they want to do it's not about the court's ability to make a decision about what they want to do it's not about the court's ability to make a decision about what they want to do it's not about the court's ability to make a decision about what they want to do it's not anything to deserve it or prompt this I wasn't part of the transaction I just wasn't um and I've never I've never and I've never said anything in regards to the transaction that should lead anyone to believe that I'm in possession of non-public information yeah so this is harassment as punitive and the fact that they're citing my tweets in which I criticize Twitter's management it's just petty and vindictive yeah I agree I mean look at your legalIs reimbursed probably good luck no five or six years ago I approached Twitter about what I would have called a friendly activist myself in a and another large fund and the reality is there's a lot of data that sits uh in the public domain that you can use to get a very clear view of Twitter's advantages and disadvantages and so you know all of these issues that Twitter is dealing with has been known for a long time to people that spent any time analyzing the stock comparing it to other social media stocks so I just don't understand what all of this is about at the end of the day a person that had a point of view has changed their mind get to the bottom of what that person thinks but going on these broad fishing Expedition I think is just really stupid and then what was Joe Lonsdale subpoenaed for I mean he just appeared for being at the all-in Summit for being a guest at the all-in Summit so so that that just shows you how silly this is too because Elon we did an interview the four of us interviewed Elon at the all-in Summit uh in Miami back in was it May is when did we do that yeah in any event um so Elon appeared but he dialed in by Zoom it's not like he was walking around the hallways bumping into people and talking like there was he did not communicate with anybody else at the Summit yeah he was a guest by Zoom so if you want to know the communications that we had just go watch that public recording of us interviewing Elon there's just again this there's no need for this fishing Expedition guys this is the this is the record for the longest amount of time in his life J Cal has not spoken so I want to I want to acknowledge this moment and we can move forward um Saks did you do any prep work for the interview with Elon while you were wow good question in the commode no in the commode there's no prep work I showed up um barely I barely showed up barely you guys remember yeah oh my gosh see and you guys don't want to do all in Summit 2022 come on 23 come on we're good we're good yeah exactly why do I need another one of these I actually want to have Friedberg stands create an event honoring him and I'm going to appear there as the keynote speaker absolutely Sultan of science Con actually I should really thank you J Cal yeah it's totally for throwing the Summit thanks Jake first I blame Twitter's executives then I blame you I think you could put listen if we do another all in Summit maybe it's profitable and can we just say legal bills can I just say like as a user just as a user okay commentary the the bot issue is really real like how many accounts are there which have like 20 or 30 followers that just spew vitriol either positive or negative constantly every time you tweet anything it makes tweeting impossible I used to be an ardent user of Twitter and I think in the last year it has become exceptionally unusable well and so they should just fix they should fix that product quality problem in fairness to Saks he did pay ten dollars per account to have those created and to control your replies but it is true if you I always screenshot it I look at who's like trolling me in replies and inevitably it is uh a six month old account with that's following 100 people and has no followers or five followers and has like some you know large but I mean it's like it's like numbers at the end of the name every time you say something every time I say something it's like every other comment is about a stock it's about a crypto thing that they want you to click on and so you know this last month I've started to experiment with turning comments off and it's been the best because I can still communicate out it gets the same reach millions of people will see what I have to say but I don't have to deal with all of the bullshit that comes with it now yeah but you can also pick you should there's a real problem on that platform that needs to get fixed here's the thing it's easily fixable because if you go to LinkedIn or Facebook or Instagram you don't see this so if it if the other platforms can figure it out across many different companies it's not like there's some secret sauce here you just have to put up you know a couple of reasonable Gates and have some reasonable reporting and you take a little friction out and people will not be able to create bots on mass yeah I noticed that problem you know in the early days of the Ukraine war when I would tweet out my opinion my non con my contrarian opinions my non-consensus opinions on the Ukraine war you get attacked I saw I remember you were getting attacked it was ruthless and those are not real people those are not real people those are algorithms yeah when you would go click on those accounts you would see that they were accounts created that month with zero followers zero following and uh they're brand new accounts without any history and they were all tweeting the same thing accusing me of being Neville Chamberlain it was all just you know Putin talking points or whatever so there you know I think particularly when you speak out against the current thing there's yeah you know an organized effort to try and drown you out and but look the Washington Post had a story about this that Ukraine was really good at what they called strategic communications propaganda but in any event yeah I mean look there's absolutely a problem it's now a playbook um if you I don't know if you guys saw the Zack Snyder uh recut of Justice League supposedly there were bot armies that put the pressure on Warner Brothers to release his cut of that movie and that he might have in some way been involved was the insinuation and it actually drove Commerce they gave him the whatever 30 40 million dollars to recut the film uh all right let's talk about markets since that's what everybody um really comes here for uh looks like inflation is uh finally maybe uh getting a little pushback gas and oil is way down a big win for Americans and obviously the administration there clearly is an upper bound to how much people will pay for a gallon of gasoline consumption is actually going down which is interesting humans pretty adaptable there uh jobs and we've talked about this every month as we watch it uh finally dipped under 11 million as sacks predicted you know we're gonna shed 300 400 000 jobs uh it seems every month uh which should take this uh you know 10 11 million number over the next year down to maybe five or six which would still be uh an unbelievable number still put us up very robust full employment which has been a big question so there's a number of of open job the the number of job wrecks it went down by something like half a million in one month yeah and it's been going down three or four hundred so it's it's kind of been pretty consistent but there's clearly something going on here and um the stock market interestingly um we've started to see a little bump here even crypto um which the most speculative of all assets I guess Bitcoin bounced as well you know hitting 22 23 now so what do you think Chamath about markets we you you may have called the bottom uh here on the program a couple of months ago and uh I started J trading three weeks ago based on our discussions here thinking that we're bouncing along the bottom is it a head fake right now I think at the time initially I think I said you know it rallies to around 4 000.

I was a little off rally what rallies to 4 000. the S P yeah probably gets to 4 200 4 300. look it's always important from my perspective today just so people know yeah it's always important from my perspective to just take the other side and just intellectually debate with oneself why the other side could be right so in at this point right now what people would say is okay the Fed's going to capitulate at the beginning part of 2023 we have a pretty clear forecast for all the rate increases that have to happen everybody's doing the work that's necessary either raising prices cutting costs or doing both letting people go Etc Etc so maybe we're we're there okay so what's the other side of that well I think again as I've stated before the other side starts with energy and the reason why I think it's important is that it really is the conflation of an economic system and a political system using an instrument and if you look inside of what's happening in Europe there's a lot of complexities here that I think need to get unpacked so for example a couple days ago the French government basically said that they're going to start producing less nuclear energy and you'd say well why would they do that well it turns out because you know the temperatures are so high you cannot use the water to cool these nuclear reactors because the the exiting water is then so hot that would actually destroy the ecosystem of the lakes and rivers that they use to feed natural fresh water in to cool the nuclear reactor second because it's so hot that all the rivers are below their natural level barges that carry coal and that gas are getting stuck on the Danube the Po which is the longest River in Italy that feeds all the fields actually can't is below the level where it can actually off you know offload the water so farmers can't basically do what they need to do to produce a food supply so if you play all of that out you start to see an issue where by you know October November of this year we're back into the same complexity where energy is the tip of the spear around which everybody starts to debate all of the national security issues that we have to deal with the Ukraine war Etc Etc so I don't know I mean you know you've made a lot of money this year by basically doing the following which is the exact opposite of everybody else when everybody else was freaking out had you bought you would have made a ton of money now everybody's like it's over and you can tell that by looking at the numbers and the numbers and the numbers and the you can tell that by looking at the VIX which is the volatility index we're about to get into the high teens you have systematically it has been true that when the VIX is in the teens you tend to basically buy volatility which is essentially you get short stocks and when the VIX is in the 30s you tend to basically sell volatility and you buy equities because we've hit the bottom if you've been doing that for the last year you've made a ton of money so there you have it I really don't know what's going to happen from here but I'm going to give you a little bit of time to think about that and then we'll talk about it in a minute.

happen from here but I tend to think things still have to get a lot worse to flush everything through the system and for people who don't know the VIX is the ticker symbol that you can look up yourself for the CBOE's volatility index which measures the stock market's expectation of volatility based on the S&P index's options trading if you look at oil sacks we are now down to 87 bucks for a barrel haven't been here since uh gosh looks like a lot of people are going to be buying stocks looks like yeah February maybe and so and gas prices plummeting something going well in this regard what are your thoughts yeah I mean it's uh that particular Commodity is coming down I still think we have a big inflation problem um why do you think it's going down I guess production stepping up I mean in response to higher prices uh people increase production and um the price comes down no no no no no there's less demand the the the crazy sad thing about this whole thing with Biden was that OPEC came back and they basically said we can increase like 600 000 barrels a day but the only two countries that are able to do it were I think Kuwait and Saudi and the total number of barrels is about a hundred thousand so with all the bluster and all of this you're right actually it's because the interest rate increases are actually having an effect correct you know these rate increases are like chemotherapy you know it's um on the economy the gas is going to be a lot of money the gas demand is lower than the summer of 2020 in the middle of the pandemic yeah yeah you're right so the the Commodity prices are reflecting expectations that the economy is slowing down and and you know maybe in a recession so supply supply modestly up demand massively down equals hey we want to get people to buy this Commodity it will lower the prices lo and behold the same thing is happening a little bit with groceries uh and we'll see what happens with travel homes also spectacularly falling down in price and the inventory spiking as well so what's your your take here you unpack the 75 basis point increase in the chemotherapy that you were going down that road well let me just speak to this this um this rally in the market for a second because I think there was a really interesting chart that Philippe Lafon showed at that kotu Summit that we talked about on the spot a few months ago and I'll just put it on the screen I put in the chat uh what it basically shows is that uh is that during you know protracted bear markets you can still get substantial bear market rallies and so during the 2000 2001.com crash you had these plus 32 plus 41 plus 45 rallies but even while the market as a whole was going down and so they ended up being sort of sucker rallies now I don't know if that is what's happening here but it is a possibility um one interpretation facts of this could be that the prospects of this could be people are picking the winning stocks while the losers continue to lose and that's what's causing this you know jagged Edge or the the dead count bounce dead cat bouncing as they say which is what we're seeing in a lot of these public companies right I don't know if you're watching but Uber you know obviously I'm still a big shareholder had a massive print and other companies have been doing equally as well Apple included I think two things happened last week one is there were a number of companies that reported uh good earnings and I think even more importantly has strong forecasts so that helped and I think it was just there was so much pessimism and negativity that just companies reporting decreases that weren't as bad as people were expecting created some room to move up but the other thing that that drove the rally is that the Fed made these comments on the heels of that 75 basis point rate increase that we were close to neutral and so the market seemed to get really optimistic that we wouldn't get much more in the in the way of rate increases maybe there would be a 50 basis point rate increase towards the end of the year which would bring the Fed funds rate up to about the two-year bond rate so the idea was we're close to neutral and markets really reacted to that the thing about that is though that I think what the what Powell and what the Fed says today about rates is way less important than what the inflation data will actually show in a few months if we still have nine percent inflation three months from now then I don't think the rate increases are done so at the end of the day I think that the data here is going to be a lot more important than what the Fed says because certainly the Fed has said a lot of things over the past couple years that turned out not to be true you would agree they seem to be doing something correct here with the 75 Bips you know and taking it a little more seriously it's having an impact I'll say it again I've said it now five pods in a row we've never seen a moment in history in American history where when CPI has printed successively above five percent that it got under five percent without Fed funds getting to that same number so we should all hope that this is the exception that proves the rule but there's an enormous amount of data that would tell you that we have to take rates to double what the equilibrium rate is thought to be right now there was no print in August they take the month of August off they could do an emergency print and then they're expecting 50 or 75 Bips in September if they do that Sachs Chamath 50 I think 50 is the expectation for September but look I think it's appropriate now after all the rate increase they've done to take a pause they're going to get two full months now of inflation data before the September Fed meeting I think it's appropriate to let the economy digest these rate increases and see where we're at and let's see where the next two months inflation print is and then that'll determine what happens next freeberg based on all this uh what's your Outlook for the economy I think there's more we all try and be predictive based on the current set of conditions in the world and there are a number of conditions in the world that the switch could flip very quickly and there's enough of those triggering events right now that um the probability of any one or any set of them happening in the next couple of months is probably pretty high uh you know I kind of talked about it on the show a few weeks ago that it's like a bunch of tortoises sticking their head out of the shell and you know there's a few that might pop out here there's obviously a massive problem with getting gas to Western Europe for this winter there's an emerging problem with food insecurity in Africa South Asia around the world there is obviously continuing escalating conflict in Eastern Europe this NATO situation may or may not help the Taiwan visit may or may not help is it escalating yeah I mean I think you know Sweden and and whatnot joining NATO is okay it's going to be viewed as provocatory and you know it it could not make things cooler and calmer over there but make them more tense I mean we view it as a security issue but it really is a conflict escalation issue and um and then I think that there are emerging markets problems you know Argentina is facing 60 inflation Brazil has a criminal as their president right now and he has said publicly in the last couple of days that he will not leave office if he loses the election because the election is fraudulent and if that happens then you could see massive civil unrest he's been encouraging the population in Brazil to go to the streets and fight back and there are a number of these flashpoints and by the way that's a massive uh you know a food supplier as well as a massive holding in EM credit portfolios around the world U.S consumer credit is a problem you know we just had the largest number of new credit card accounts open since 2008 in Q2 from the New York Fed report yesterday all of these things I'm painting as pictures of potential flash points for what could quickly become wildfires or brush fires that spread very quickly in markets and could escalate some of the considerations so I don't feel like I look around and say everything is good we're in a good place there are some indications that some of the stagflationary considerations and concerns we may have had in the way that markets are behaving right now gives us a pause gives us a respite makes us feel okay but there are also a lot of things that could go wrong and any one of those things could be a triggering point so I always think in terms of probabilities there's a whole bunch of low probability things but when you have enough low probability things the probability that something in the set is triggered becomes high that's where I kind of say look the probability of something being a flashpoint for us this year is high I also still think that globally we are very primed for conflict right now and we feel like and are hoping that the Russia Ukraine thing resolves but there are other points of escalation look at what's happening with Pelosi visiting Taiwan everyone that's you know even well informed is scratching their head saying what the heck is going on here there is currently an indulgence in conflict and I think that that indulgence will um you know cause more harm than good uh particularly for these financial markets that we're commenting on right now in the months ahead so um look I you know like I've always said I'm not going to be one to time markets it's like trying to time social behavior like who's going to say some word first I don't know the answer in a population of people you know you can kind of guess how people are going to behave but markets are the output the manifestation of social behavior and so timing markets is very difficult I think you can do a good job analyzing businesses and the quality of businesses and how they will perform over time I don't think that anyone over time can do a good job timing markets and I think that there's a lot of these things that could really shift anyone's perspective on what you believe right now very rapidly in another direction based on any one of these uh things happening trim off do you feel the world is uh as Dr doom here is you know setting it up I'm not by the way I'm not being negative I'm just pointing out that there are a set of things that could flip things the other way right absolutely I'm being slightly facetious here but you paint a pretty stark picture of hey there's all these tipping points around the world chamath do you feel like this is how the world works there's always a bunch of potential tipping points there's always going to be wars sadly and there's always going to be countries uh that are dealing with dictators or insolvency especially in frontier markets and emerging markets or is this chaos you know really acute and and people should be uh you know anxious and in a panic I think both of you guys are right like there's always stuff going on in markets and markets represent the collective sum of our wishes and expectations and also the realities this is why I think for me at least the way that I process this information is not trying to have an opinion on any one of those things because I just I find it too hard and I don't have enough depth of understanding of any of those things for me I'd rather go back to the historical Trends because I find a little bit easier to parse and whether any of those things are true and can they turn that radio down Jason we're we're just talking something oh okay no problem I it's just a little we can't hear you sorry I'm gonna no problem the second helicopter is replacing the first helicopter because swapping out yeah no that's a big helicopters are switching on the helicopter I mean it takes a team to part this so the the real problem is that like if I go back to the historical artifacts have there been issues in the past the way that you know um freeberg described absolutely so this is why I think you can look at the fact that whenever there's inflation and whenever it's spiked this what has had to happen by the Fed is you have to take rates above that key five percent threshold when the CPI is above five percent to break enough demand so that the economy's reset and I think that's where we are so instead of trying to figure out whether you know I mean the the Brazil thing as an example that that freeberg said is crazy like he's basically you know he said publicly in a press release the army is on my side and it's ready to help me you know keep and stay in just the craziest thing so what are you supposed to do the fighters need to take to the streets so what are you so what are you supposed to do in my opinion I'm like you know what a version of Brazil has happened before I don't know enough history quite honest you know the specifics of what happened then and how that could translate to now and I don't want to spend the time understanding what's going to happen in Brazil right now I'd rather just say there are 20 or 30 things that could very much complicate the world economy I think the reality is that governments need to flush all this excess money out of the system so that we can really find out what equilibrium demand is and get back to normal there's also by the way a really important trend chamath unlike that I think is playing out and will play out for the next decade on deglobalization so as the U.S tries to build its own semiconductor manufacturing capacity as China loses key trade partners as all of these markets stop trading with each other and start to build redundancy there is a massive longer range economic effect of deglobalization globalization enables efficient pricing it enables labor and energy and everything to be done you know to go to the cheapest source that's the way globalization has benefited us we've been able to get cheap energy and cheap labor in overseas markets to do work for us and as a result we've gotten access to cheap products so when you deglobalize you end up having to pay more for labor more for energy you have to build infrastructure and the price for everything goes up we've said this on the pod for two years now that era of cheaper faster better is over and what comes with that is better National Security but the cost of that better National Security is higher prices higher prices less growth and there's nothing that we can do to avoid that I'm not sure I agree with the less growth I actually think that there's enough excess slack to be absorbed by all of this free money that I think you can still have sustained growth but it will come with higher interest rates and higher inflation and higher input costs everybody will have to do their part to absorb some of this but that's what's going to happen and I think we should just deal with the medicine as quickly as possible this is why the people that actually think that the fed should just be very aggressive and get this over with quickly I suspect on the margins are right the problem is they don't want to look at the historical artifact because they sort of artifact would say wait I need to raise interest rates by another 250 basis points that's just way too disruptive for what the world is ready to to hear right now so we're going to incrementally plot along and I think what freebrook says is right which is that there's going to be a whack-a-mole that emerges that's going to tilt the markets then the consumer credit thing will implode that's going to tilt the markets then Jair bolsonaro will try to take over Brazil that'll tilt the markets and we'll go back to this you know inflationary fragmented de-globalized view of the world that just frankly takes higher interest rates to normalize all right and sax I'll bring you on this I mean counter to freebrook's point the the counter obviously would be hey we will have less dependency on dictators like Putin Xi Jinping MBS Etc and that would be great for humanity and we'd have resiliency in our supply chain uh and you know the West now becoming unified say what you will about the NATO membership and the timing of it it's probably a great thing that the West is saying hey we're going to get together as a group I think you would agree and stand against dictators invading other countries and if everybody pays their fair share to be part of NATO that's not that's not what they said that's not what it is well I mean no that is not but look be intellectually honest every day we all said the first part and just nobody talked about that second part and the only person who you know which is Josh Holly who's you know not exactly my favorite person in the world but maybe sax wants to comment was the only one that actually said which is probably the fair thing with Jason you are saying is part of the deal it is not part of the deal no no should be part of the deal I'm saying it should be part of the deal and for people who missed what we said there United States spends three and a half percent of our GDP on uh military other places in NATO might be spending one or two percent and we're trying to get them all to two percent to be a little closer to us and then this obviously trip to Taiwan strengthening our relationship with that country but at what cost and why are we doing it now uh all come into play here so do you actually think that this trip to Taiwan actually strengthened our relationship with Taiwan did we come out with a deal for chips did it see all of a sudden say in what way I'm curious well because they are I mean did you not see their statements and giving Pelosi Awards and they Taiwan very much wants to strengthen their relationship with the West that that is their goal they want to strengthen the West they want the protection of the West so yes it's trying to get this was a coordinated hold on let me finish it does strengthen our relationship with Taiwan the question is does it provoke China and was it necessary at this point in time in history when the world does feel like uh it's a little bit of a powder keg no but so so six months from now when all the fruits and vegetables that have been embargoed and not sent to Taiwan and then the sand that allows them to make chips continues to not flow do you think that they'll still be positive about the trip we'll see I mean I I let's go to Sax he likes to comment on these things so all right well I want to dismantle everything you just said I know that's why I set you up for it so I'm Pelosi I mean look once it came out that Pelosi was going to Taiwan and China threatened her and the U.S saying you can't go obviously we couldn't back down from that because we can't let China dictate which of our officials can go to Taiwan so at that point we had to back her play and you saw that everybody from Fox News to 25 Republican senators got on board okay but here's the issue the real issue is should she even have been going I think this trip was self-indulgent it was reckless she was told by the Biden administration don't go this is not the right time this is a sensitive time the uh the CCP's got their party conference in the next couple of months there was no reason to basically provoke this showdown right now and she just dismissed what the administration with Biden and what the Pentagon told her to do because she wanted to make some sort of valedictory tour to Taiwan so look Nancy Pelosi does not deserve any credit for this trip did we have to defend her once you know once China threatened her yes of course we had to like I said back her play but this was reckless and it was self-indulgent and it didn't need to happen and you know it really makes you wonder who is calling the shots in this administration when Pelosi won't even respect the wishes of a president in her own party and what is she doing going over there she's not the secretary of state I had the same president had the same questions like why why now why not Thomas Freeman had well because it's all about her making this valedictory tour before she's going to hand over the gavel look the Democrats are going to lose the house in November once she passes the gavel to a new Republican speaker of the house I think she'll be announcing her retirement shortly after that so this is all part of her farewell tour but it didn't need to happen and the fact that she did it in violation of the wishes of a president of her own party makes you wonder who's calling the shots over there and it kind of reminded me you know a few weeks ago Gavin Newsom was over at the White House when Biden was over in Europe and everyone was translating what's he doing over there is he measuring in drapes yeah he's measuring the drapes so you know it just goes to show this does this administration have control over anything over the members of their own party over 60 of Democrats say they want someone different to run in 24.

so yes there was a surface level of consensus and backing of Pelosi but if you scratch beneath the surface you see that the trip was unnecessary and reveals a president who doesn't seem completely in control of our foreign policy so in a statement um almost universally uh the leadership of the Republican Party said for decades members of the U.S United States Congress including previous speakers of the house have traveled to Taiwan this travel is consistent with the United States one China policy to which we are committed we are also committed now more than ever to all elements of the Taiwan relations act so one China if you don't know is that Taiwan and China are all part of one uh unified uh entity so we're the Republicans seem to be supporting this in a cynical way you're saying or it is consistent that uh other members of the United States Congress have gone including other speakers of the house I think there is bipartisan support now to defend Taiwan I actually think that that is in the cards I think there's a very high probability that we actually end up in a war with China really this century oh yeah I don't think so I think so much flashpoint in the world uh I would agree with that but explain why you think there's going to be a war because I think a lot of people think there's way too much at stake here for there to be a war so there is going to be some sort of negotiated settlement in the South China Sea so why would you think you think the majority cases there's going to be a war really you you have to look at it first of all from the Chinese point of view they view Taiwan as sacred territory and for decades now they have said in every single meeting diplomatic meeting with the U.S Taiwan is always their number one issue they are hell bent on recent history unification of mainland China with Taiwan and they would like to do it peacefully through coercion if they can but I think they will do it militarily if they must and the only question is when they feel that they will be strong enough to basically take the island by force so that's I think the Chinese point of view and I think America is increasingly committed to the defense of Taiwan so you know we have contradictory statements on this though the one China policy says that we respect that there's one China but on the other hand the Taiwan Relations Act commits us to help in the defense of Taiwan so we have a contradictory policy on this but if you really want to understand as does Saks you would agree China has flip-flopped on this and it's only the last hundred years that they've really considered Taiwan strategic they didn't care about it two or three hundred years ago they were kind of like this is worthless you guys do what you want Taiwan was part of China until 1895 when Japan took it from them yeah yeah yeah yeah yeah yeah yeah yeah yeah yeah yeah they didn't want it at that time that's that's the other thing they were like this is worthless real estate we don't care it's only true well Taiwan Taiwan is extremely important strategically and if you want to understand why I think you need to look at this map yes no I read up on that I think it's really interesting pull that up actually yeah it's a really interesting discussion because 200 years ago they didn't care and then all of a sudden they're like wait a second if we're going to be in wars with the West and Japan's going to be a democracy we do actually have something at stake here we'd like that island back the island chain strategy was originally created by John Foster Dulles this one of the Secretary of State I think under Eisenhower who was one of the initial architects of our containment policy against the Soviet Union but also came with this idea of how we would contain China in East Asia and the basic idea is that China is surrounded by a series of island chains the first island chain goes down from the southern tip of Japan to Okinawa to Taiwan to I think there's some islands of the South China Sea the Spratly Islands uh it's got the Northwest tip of the Philippines that's the first Island chain second Island chain goes out to Vietnam Eastern part of the Philippines no Vietnam's all the way down and I think it's second Island chain includes you know it goes down to Indonesia and then I think there's even a third Island chain that includes Guam although Guam actually might be in the second somewhere it's somewhere around there it's a heavily fortified American base so the idea is if you want to bottle up and contain China you do it by controlling these island chains and Taiwan is really the central one it sort of divides this East China Sea uh where you've got South Korea and Japan from the South China Sea where you've got Vietnam and Malaysia between Vietnam and Japan it's literally if you were to draw a center line of China's coastal access that is it yeah so so the bottom line is this if you want to pursue a policy of containment against China you really want to control these island chains another way to think about it is that these islands are unsinkable aircraft carriers they allow America to project power 6 000 miles away into the Pacific that's how we saw it during World War II is we had all these island hopping battles and as we took these islands they would then become a runway for the next stage of to project American power to get all the way to to Japan so you know if you believe that we're headed for or we already are in Cold War II with China and I think we are I think China is really I think we'd all be a political threat not Russia the way that you would contain China and keep them bottled up is to have these uh islands in the American alliance it's gonna be very hard for China which is now building a huge blue water Navy has actually more ships in the United States it's gonna be very hard for them to project their power all over the world if they are contained a bottle up and have to watch their own back one put on the number of ships though in East Asia is you know they they have a lot of small ships the tonnage wise we have much more tonnage and if you were to look you know even uh the the perfect setup as you explained through these islands is very similar to NATO and the um what's happening with Russia you know we have Korea we have Japan uh we have Vietnam the Philippines we have an incredible Alliance in this area and that's a great thing for America and Taiwan obviously is a jump ball here uh um but this is a setup for China you know having Jason what do you think about the repercussions of her visit so CATL which is Tesla's biggest battery supplier basically you know delayed the announcement of a of a factory it's not clear whether they're going to put it into the United States they may actually pick a city in Mexico but what the decision that was supposed to happen now has now been delayed until September or October there's a bunch of you know there's all of these crazy military drills that happened was it all worth it I mean that is the question and I I'm asking you now was it worth it we don't have enough information I think to know what why this was done now it was it a freelance he asked me a question let me finish is is it a freelance and Nancy Pelosi is completely freelance or is there a bigger strategy here is the question is China weak now are we trying to send a message to them and one could equally take the side of the argument that the United States supporting Finland uh supporting Sweden supporting NATO you know supporting the Ukraine and supporting the Pacific is actually the right move here to contain the dictators I agree but we have a I agree but we have two people to do that it's the president and the secretary of state well that would be a much bigger provocation I think is the issue so if you sent the president that would be a very big provocation the Thomas Friedman article that Sachs mentions yeah it was pretty explicit that you know Blinken and Biden both told her please stand down yeah the NSC and the joint chief said please stand down you are way over your ski tips here and she's great I agree I I I've been very public what is the point of doing this now is the question and we don't have information once China tried to dictate to Pelosi that she couldn't go of course we had to back her play but you have to be kind of a fool to fall for this in the first place this was self-indulgent by Pelosi she didn't need to pick this battle the administration asked her not to and look let me give Biden some credit here Biden has the right policy on Taiwan which was stated this way he says that we support the status quo and we are against unilateral changes to the status quo we want the United States to be a status quo power with respect to Taiwan and force China to be the revisionist power and we need to be very careful that we do not come across as the revisionist power that would give China an excuse so we want to just maintain the status quo that should be our policy all right everybody we'll see you next time on the all-in pod bye-bye foreign foreign foreign foreign foreign foreign foreign foreign foreign foreign foreign We'll meet in the as-is We should all just get a room And just have one big huge orgy Cause they're all just useless It's like this sexual tension That we just need to release somehow Wet your feet Wet your feet Wet your feet We need to get merch I'm doing all in I'm doing all in you you you